Brunt Hotels, PLC, owns more than 60 hotels throughout the United Kingdom. They recently acquired a small hotel chain headquartered in France. Brunt’s chief executive decided that half of the new hotels in France would be retained and rebranded as part of the Brunt Hotels Group; the other half will be sold.
This will support Brunt’s strategic objective of growing the organization slowly to make sure that new ventures are well supported and opened on time and on budget. Brunt’s hotels are considered budget accommodations; they are functional, clean and reasonably priced. Additional information about UK hotel standards is available at Most guests stay for one to three nights and are a combination of business and leisure travellers. The hotels are typically situated in downtown locations that are easily accessible by mass transit.
Tourists are attracted to these hotels in popular visitor destinations where the many local attractions mean that they will not be spending much time in their hotel rooms. The organization has decided to use an ethnocentric approach and send some of their existing UK-based managers to France to lead the changeover of the new hotels and then manage them after they re-open. If this new overseas venture is successful, Brunt may decide to acquire other small hotel groups in other European countries. The organization would like to own 150 hotels in the next five years. Their 10-year plan is to own 300 hotels across Europe.
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This is an ambitious target, so it is important that the organization finds an effective formula to operate successfully in other countries. The management team decides to select only one of the three proposed training programs, confident that it will be useful and informative for the new expatriates. However, they would also like to provide external support for the new expatriates to make their transition to a new country as smooth as possible. They are aware of some of the services that can be offered to support employees on both a personal and professional level, but do not have a comprehensive overview.
The management team asks you to conduct Internet-based research to find out what expatriate support services are available.
The management team liked your recruitment advertisement, but realized that they did not consider the salary for these new positions! Since the organization has never hired managers to work outside the UK before, they do not know how to start determining the compensation. They provide you with the following information that they found on the Internet:
- Existing salary for managers is 0,000 (45,000 Euros) plus bonuses.
- Surveys show that the average salary for hotel managers in France is 60,000 Euros with no opportunity to earn bonuses.
The directors want to have a consistent approach as to how they compensate expatriates because they expect their overseas business to expand in the future. They also want existing employees to be enticed into working abroad and want to have a good range of incentives.
Design a compensation package for the hotel management position. Explain the rationale for your design.
You may also include non-financial benefits. Case Study 3 This is a case of two competing hotels, Sunrise Hotel and Beachside Hotel that are both located in a medium sized, tourism based town in the Northeast U. S. The hotels are both competing for the same set of guests, as well as the same set of potential employees. They are both budget hotels, right next door to each other, with 60 guest rooms each and a view of the beach. The occupancy during peak season for the Sunrise Hotel is 98%, but during the winter months goes down to 65%.
The Beachside Hotel has peak season occupancy of 90% and off peak occupancy of 50%. Joe is the General Manager of Sunrise Hotel and has been in his current position for 5 years. He has been with Sunrise Hotel for a total of 10 years. He worked his way up at Sunrise Hotel from front desk agent to front desk supervisor, and finally to Assistant General Manager before he became the General Manager. He does a good job of screening potential employees for his front desk area of the hotel because he realizes the importance of that area of the hotel, especially in tourist areas.
He also has incentives set up for excellent performance of the front desk agents and training and development programs designed to give everyone information that will help them do their job better. There is a sense of teamwork at Sunrise Hotel and that helps everyone want to do a good job. His guest satisfaction ratings for his hotel are overall excellent. On a rating scale of 1–10, his hotel averages a 9. The average length of tenure of his employees is 4 years, and his current front desk supervisor was promoted from within, along with his Assistant General Manager.
Because of the small size of the hotel, Joe is actually involved with all of the hiring decisions and helps to give training programs himself, along with his leadership team. The employee turnover at the Sunrise Hotel is 25% overall and that is primarily when hourly employees graduate high school or college and leave the Sunrise Hotel for a career somewhere else. Brian is the General Manager of the Beachside Hotel and deals with a very different situation. Brian was brought in from another hotel in the same hotel group about 6 months ago.
He was told by his boss that he needed to “fix” this hotel so that it would start having better customer satisfaction ratings and more return guests. Despite the fairly high occupancy noted during peak seasons, the off peak season occupancy is only 50%. Also noted by his boss, the occupancy should be as good as the Sunrise Hotel. Brian has been with his hotel group now for 2 years and he came out of the accounting and finance department in his old hotel. He has a great understanding of the numbers in the lodging industry, but has not been involved with the human resource aspects of the job.
The turnover of hourly employees at Beachside Hotel is 120% and that means that Brian is constantly running the hotel short handed and with new employees. The Beachside Hotel has been doing the hiring through a human resource practitioner in the hotel that was put in the position because she really could not handle serving guests at the front desk very well. Mary was promoted to human resources a year ago after she had one too many altercations with the guests at the front desk. The owner of the hotel wanted to make sure that she would not make any of the other guests angry, so he promoted her to a human resources practitioner.
Since that time, she has been busy trying to keep up with hiring and she has had no time for training employees. Because she is so busy, paychecks often come out to employees late, there are no policies written down for employees to use as a guide for performance, customers are treated badly by new and poorly trained employees, and the departments of the hotel do not communicate very effectively and therefore everyone blames everyone else when things go wrong. The average length of tenure of the front desk agents at the Beachside Hotel is 3 months and the customer satisfaction rating at the Beachside is a 6 out of a 10 possible rating.
Most of the front desk agents that are hired come from other hotels in the area after they quit or are fired. Brian is not involved in the hiring for the hotel at all, and does not get involved with training and development. He spends most of his days looking at the financial reports for the hotel and analyzing average daily rate, occupancy rates, and REVPAR. Brian knows that he has many problems to deal with and so he goes to the Sunrise Hotel to observe things over there for a while. He sees a happy crew and talks to Joe about how he is making that happen. Joe is happy to help, but wants Brian to go back and observe his employees first and come up with ways that he specifically can help guide Brian.
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