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INDIAN INSTITUTE OF TECHNOLOGY ROORKEE

Case Study : The Georges Hotel

Submitted to:
Prof. (Dr.) S. Rangnekar
Department of Management Studies
IIT Roorkee
INDIAN INSTITUTE OF TECHNOLOGY ROORKEE

Aditya Roy Munka Gaurav Shahi


Electronics Engineer Electrical Engineer
Kalyani Govt Engineering NIT, Silchar, Assam
College,WB
Student Coordinator,
Placement & Corporate
Work Ex- 23 Months Relations, DoMS ,IIT
Ericsson India Pvt Ltd Roorkee
Marketing Research Intern Worked in TCS as an SAP
in Maxtron Innovations. BASIS Consultant
ERP certified, Six Sigma
Certified
INDIAN INSTITUTE OF TECHNOLOGY ROORKEE

Souvik Pal Shubham Srivastava Himanshu Verma


Information Technology B.tech Metallurgical Computer Science
Engineer Engineering Department Engineer
Kalyani Govt Engineering IIT BHU Varanasi Rayat & Bahra University
College,WB (Mohali)
Chemical Analyst at Class Representative,
Work Ex-32 Months Initiative Chemicals DoMS IIT Roorkee
Capgemini- Associate Pvt.Ltd.
Consultant Work Ex – 17Months Work Ex- 16 months
Member at VyavaHR Club Vishleshki Coordinator S.B.S Biotech
Area Sales Manager
Member of Adcom team Member of Adcom team Six Sigma Certified.
for conducting the for conducting the Member of Adcom team
interview at DOMS IIT interview at DOMS IIT for conducting the
Roorkee for 2021 batch. Roorkee for 2021 batch. interview at DOMS IIT
Roorkee for 2021 batch
The Georges Hotel: Brief Introduction

• The Georges Hotel is a small European-style boutique


hotel located along the Magnificent Mile in Chicago.
• It is co-owned by two brothers, Jeff and Chad Mitchell.
• They grew up in the hospitality business and were raised
at the roadside motel.
• Jeff loved the hospitality business form a childhood and
would not mind the less glamourous work, Today Jeff is
chief executive officer of the Georges Hotel. He makes
most of the decisions and manages the hotel’s day-to-day
operations
• Whereas his brother Chad (vice president of community
relations) had no interest in working at the motel as a child,
and he remains the same as an adult. He spends most of
his time playing golf or leaving for his second home in
Florida.

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The Georges Hotel: Description

The Hotel
• 163 guest rooms, 65-70 employees.
• Front desk: 10 employees.
• Valet parking services: 8 employees.
• Housekeeping: 28 employees.
• Engineering and facilities maintenance: 4 employees.
• Management and administrative: 15-20 additional staff members assigned to
departments throughout the hotel, including management, office support and
sales.

The Garden Terrace Restaurant


• Approximately 35 employees.
• The restaurant is open daily from 5:00 a.m. to 10:00 p.m.
• In addition to restaurant dining, the restaurant provides 24-hour room service and
• full catering services for meetings, conventions and other hotel events.

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The Characters in the Case:

The Mitchell Family


• Jeff Mitchell: Chief executive officer, owner and brother of Chad.
• Chad Mitchell: Vice president of community relations, owner and
brother of Jeff.
• Cindy Mitchell: Director of human resources and Chad’s wife.
• Michael Mitchell: Sales and operations associate, Chad and
Cindy’s son and recent MBA graduate.
• Brandon Mitchell: Chad and Cindy’s son who is studying for a
degree in culinary arts and anticipates a career as an executive
chef. Not currently on staff.
• Julie Mitchell: Jeff’s daughter who is about to complete an MBA
program at a prestigious university. Not currently on staff but
expects to work at the hotel after graduation.
• Dale Elsner: Catering service manager in the Garden Terrace
Restaurant and Cindy’s brother.
• Numerous nieces, nephews, cousins and friends of the family are
employed throughout the hotel.

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Mission of the Organization

For the Guest

The hotel’s mission promises guests exemplary service


and a memorable hotel experience.

For the Employees

The hotel promises a superior work environment and


continued support for a satisfying career.

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Organizational Chart: The Hotel

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Organizational Chart: The Garden Terrace
Restaurant

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Recruitment Policies of the Hotel

• Cindy always preferred to hire by referral.


• Employees brought in family members as new hires.
• Believe that family connections among employees benefit
the hotel.
• To foster the family atmosphere, staff members are
encouraged to invite family members to lunch. Families are
always included in summer picnics and holiday parties that
are hosted by the hotel.
• Employees post their children’s pictures and announcements
of new babies, graduations, weddings and other family
accomplishments on the bulletin board in the break room.

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SWOT

• What are The Georges Hotel internal strengths and weakness?

• Identify competencies and capabilities that the hotel management can


work upon.

• What opportunities does the company have ?

• What threats can you identify that may negatively impact the company’s
future?

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STRENGTH

• Family environment in the company , it has always been the essence of the The Georges
hotel.

• Easy hiring process of the staff

• Low attrition Rate among the staff

• Good Employer and staff relationship

• Multiple Roles quick decision making.

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STRENGTH

• Stability: Family position typically determines who leads the business and as a result there
is usually longevity in leadership, which results in overall stability within the organization.
Leaders usually stay in the position for many years, until a life event such as illness,
retirement, or death results in change.

• Commitment: Since the needs of the family are at stake, there is a greater sense of
commitment and accountability. This level of commitment is almost impossible to generate
in non-family firms. This long term commitment leads to additional benefits, such as a better
understanding of the industry, organization and job, stronger customer relationships and
more effective sales and marketing.

• Flexibility: There is no certain ”job description "in a family business. Family members are
willing to wear several different hats and to take on tasks outside of their formal jobs in
order to ensure the success of the company.

• Long-term Outlook: Non‐family firms think about hitting goals this quarter, while family
firms think years, and sometimes decades, ahead. This “patience” and long- term
perspective allows for good strategy and decision-making.

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Weakness

Family
Family
Conflict
Conflict

Succession
Succession Unstructured
Unstructured
Planning
Planning Governance
Governance

Nepotism
Nepotism

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Weakness

• Nepotism has worked well for staffing the current hotel, but Cindy recognizes the
downsides to hiring friends and family and knows it will not be adequate for staffing a
multiunit organization. For example, there is an assumption among some employees that if
you are a close friend or are related to a supervisor or a manager, you have a job at the
hotel for life.

• There are also attendance problems, but everyone protects their friends and family, and
employees have little accountability for performance.

• Family Conflict: Conflict is bound to happen at any firm, but when generations come
together conflicts are bound to happen even more. Deep-seated, long-lasting bitter fights
and quarrels can affect every single person within the firm and can draw divisive lines.
Since family members are involved long term quarrels can become difficult to resolve and
result in difficult endings.

Unstructured Governance: Governance issues such as internal hierarchies and rules, as
well as the ability to follow and adhere to external corporate laws, tend to be taken less
seriously at family businesses, because of the level of trust inherent at family firms.

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OPPORTUNITY

• Better trainers for the new employee.

• Can help in hiring of new employees.

• Restructure of the policies.

• Opportunity to implement family in the upcoing hotel chain.

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THREATS

• Since there has been high nepotism in the staff this can lead to high dissatisfaction among
the employees who are not relatives of the management and can lead to high distress
among the staff.

• No succession plan. At some point, a member of the team may retire, leave or even
worse, die. Just imagine what would happen to a business if there was no succession plan
in place for the unexpected loss of a key member, or worse, the only member of the
team. Research shows that nearly two-thirds of family businesses do not survive the
transition from first generation to second generation. Some of that failure is attributable to
the next generation not having a desire to carry on the business, but more importantly and
significantly, it is due to poor transitional planning.

• Feuds within the family. Family businesses are faced with the challenge of internal
conflicts that come about from the inability to separate business and personal lives. The
feud could be for a host of reasons, such as varied interest, difference of opinion, or
personal rivalry that works its way into the business. Whatever the cause, it is important to
work through these conflicts as achieving common goals will become increasingly difficult,
and the stress placed on staff may cause them to leave.

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• Allowing your emotions to run the business. You may recall this line from The
Godfather –“It’s not personal, it’s business.” This is easier said than done, especially in a
family owned business, and especially if you are managing a family member. Emotions do
become personal, and allowing them to run the business can significantly interfere in your
interactions with employees and customers. Your emotions could make you appear weak,
and severely affect your ability to make sound decisions. On the other hand, if you appear
cold and insensitive, you may be regarded as unapproachable. You will need to determine
the right balance of emotion based on the dynamics of your business environment.

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Scenario A
Players involved:

Chad Mitchell, Jeff Mitchell, Cindy Mitchell,


Vice President of Chief Executive Director of Human
Community Relations. Officer. Resources

Michael Mitchell,
sales and operations
associate

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Description of the Scenario A
• Jeff, Chad and Cindy were excited about the new hotel. It was an opportunity to expand
the Georges and to create a legacy for the children.

• Managing the hotel was good work and they wanted to implement the same policies for
expanding the business.

• Jeff was involved highly during the construction period of the business and being out
there. Chad was not much involved during the inception and construction part and was
more interested in sitting in his nicely decorated office.

• Jeff and Cindy went knew the staff individually. For expanding they will be hiring and
managing a lot of new employees for jobs at other locations quite soon, and they won’t
know everyone the way they do now.

• In the end there is a conflict of interest in deciding who will be the next CEO
Julie or Michael.

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■What are the pros and cons of a family-
owned business?
■What should be recommended to reduce
the negative aspects of operating a family
business and to capitalize on the positive
aspects?
■How can Jeff and Cindy make family an
asset going forward into a multiunit
organization?

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Negative aspects of a family-owned
and managed business

Ego Issues

Promotion Disagreements
Negative
aspects

Sense of Preferential
belongingness Treatment

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Positive aspects of a family-owned and
managed business

Loyalty
Knowledge
transfer Trust

Positive
aspects
High Employee Less
Commitment recruitment
Legal costs
and Tax
Benefits

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Recommendations to reduce negative aspects and
capitalize on positive aspects

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Reducing Negative Aspects

• Proper Job description for all so no duty


Ego Issues crossovers occur.

• Proper training before joining business.


Training

• Proper promotion and compensation


Policies policies required.

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Capitalising on Positive Aspects

• Appropriate policies and performance expectations


Performance must be established for all employees.
Metrics

• Unqualified family members should not remain


Removal of employed after training is provided.
family member

• Equal compensation and performance


Equality
expectations for all employees.

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Making family business into multiunit organisation

Open Hiring policy

Documentation of
defending double standard

Appropriate employee
benefits policies

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Let us look into “The Three Circle” Model!!

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What Cindy thinks should be done!!

• New Policy structure and employee issues should be addressed.

• Need of employee policies that should be implemented in the previous hotels


and the new hotel.

• Need a staffing plan for hiring new employees.

• Hiring to be done outside of family as they have already hired nearly all the
relatives that are available.

• Need more concise management practices to ensure additional hotels run


smoothly.

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Strategic Planning
• Strategic planning is a management activity that is used to set priorities, focus resources,
to ensure that employees and other stakeholders are working toward common goals &
adjust the organization's direction in response to a changing environment.

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Strategic Planning

The organizational culture at the Georges is based on three components: owners,


employees and customers. Each component is typified by values and needs that are
important to each group:

Owners Employees Customers


• Take pride in the family
• Seek inclusion. • Want luxury
atmosphere. • Value relationships accommodations.
• Desire to grow the and family. • Expect quality
organization.
• Want a supportive service
• Desire to bring adult
children into management work environment.
and pass the organization to
the next generation.

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Strategic Plan: Year 1
Understanding of the environment in which the
hotel operates.

Need to plan for the future and establish long-


term goals for the organization

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Recommended Activities

Update the hotel’s mission and values statements if necessary

Assess the environment by conducting a SWOT analysis, which should include


an analysis of the hospitality industry as a whole, an analysis of the Georges
Hotel and an analysis of the hotel’s employees.

Agree on the long-term goals of the organization.

Assess employee factors by conduction Job Analysis, Compensation survey and by


conducting a workforce assessment.

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Probable outcomes of the activities

Cindy would be able to directly communicate her vision to her stakeholders

The Swot analysis would enable Cindy and Jeff to get the overall idea of the
Hotel Industry and changes that should be implemented

Defining the long term goals would help Jeff and Cindy to make clear short
term goals directed towards achieving long term goals

This would enable Cindy as an HR manager to understand her employee perspective


and she could better define the performance goals of the employees.

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Strategic Plan: Year 2
Designing of new policies and goals

Implementation of new policies

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Recommended Activities

Align compensation practices with the organization’s values and goals.

Establish a performance management system

Write and distribute an employee handbook.

Ensure that policies are consistent with the organization’s mission and values.

Assess employee development gaps and ensure that staff is trained and ready for the
organization expansion

Build a staffing plan and begin recruitment.

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Probable outcomes of the activities

Alignment of the compensation practices would attract good talents


towards the organisation

The performance management system would ensure that employees


and the managers are well aware of their strength and weakness

Employee Handbook would be handy for the employees to understand


what organization expects from them.

Estimating the training gaps would ensure the timely trainings and
knowledge transfers among the employees

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Strategic Plan: Year 3
Evaluation of the Process

Feedback from the Employees

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Recommended Activities

Hire additional staff, conduct onboarding activities and provide training that meets
the needs of the expanded organization

Open the second hotel

Evaluate and monitor processes, and update them as needed to ensure that
new procedures are appropriate for hotels that will be added in the future.

Voice(Feedback of Employees for improvement of the system)

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Probable outcomes of the activities

Onboarding and Recritment would ensure the selection of the best candidate.

Training would help the new recruits to get well adapted with the culture
and values of the organization

After opening the second hotel ,it would be time to implement the
organization restructuring

Evaluation of the processes would provide the further scope of


improvement

Voice of the employees would enable a feedback mechanism for the process
and would be in lines with the mission of the company.

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Conclusion

Organizational Restructuring , After the strategic


though is a pain taking process implementation, they would get a
but the leaders would reap the solid background for the
results after its proper implementation of best practices
implementation. for their future endeavor.

This implementations would also


be beneficial in solving the
difference of opinions between
Jeff and Cindy as the
performance management
system would bring out the best
out of them.

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Research Paper 1

Title: Identification of growth factors for small firms: evidence from hotel companies on an island (2016)
Journal of Organizational Change Management, Vol. 29 Issue: 6, pp.994-1029

Authors: Senem Yazici, (Department of Hospitality Management, Muğla Sıtkı Koçman University,
Muğla, Turkey)

Abstract: The purpose of this paper is to mainly investigate what factors drive growth for independent
hotel firms on an island. Design/methodology/approach.

Two steps were followed:

First - To identify hotels demonstrated significant growth; 92 independent hotels in North Cyprus
were analyzed via a self-report questionnaire.

Second - Key growth factors were examined in five hotels showing the growth over years
among the independent hotels via in-depth, semi-structured interviews, focus group interviews,
and observations.

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Continue…

Findings:

The study findings revealed 6 important growth factors for hotels, including active risk
taking, education, family history, networks of contacts, customer concentration, age of founders.

The research findings unveil new factors referred to as “political conflict – pursuing different
strategy and opportunities,” importance of second generations affect and entrepreneur’s
metacognitive strategies, “informal networking.”

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Research Paper 2

Title: Family hotel businesses


Strategic planning and the need for education and training. (2015)
Education + Training, Vol. 46 Issue: 8/9, pp.406-415
Author(s):
Mike Peters (Lecturer, Department of Strategy and Tourism
Management, Center for Tourism and Service Economics, University of Innsbruck, Innsbruck,
Austria)
Abstract:
Small businesses dominate the tourism and hospitality industry worldwide and are of critical
importance for the competitiveness of destinations. Small/family hotel businesses are
characterized by a number of specific business processes which generate particular training and
educational needs.
It is increasingly clear that small businesses are not miniature versions of larger ones, but they have
different structures, priorities and strategic objectives. This paper investigates a number of
management areas, such as: planning, strategy development and behavior in these enterprises, to
determine skill and competency gaps.

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Continue…

• Results:
Family business managers were asked to indicate advantages and disadvantages of family
enterprises.

The results are in line with the social sciences literature.

-More interesting in terms of identifying training needs are the perceived disadvantages of a
family business: Half of the sample thinks that entrepreneurs have to invest more work and time
when the enterprise is a family business.

-In the qualitative pilot test several key areas of family business management could be identified as
critical for their performance, including human resource management, cooperation management,
and strategy planning.

-The influence of the family business system on the entrepreneurs' job satisfaction was also
identified as a key factor.

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Books for further reading

Abstract: This book contains 7 short essays and presents


fresh data on why family businesses perform better than
non-family businesses around the world.

The seven essays span the following topics:


• The Enduring Advantage of Family Business
• Wealth Paths: The Rise and Fall of Family Wealth Over
Generations
• Sustaining Family Success Requires Growth, Talent, and
Unity
• The Job of an Owner in a Family Business
• A Tour of Governance Essentials for the Family
Enterprise
• The Secret of Great Leadership Transitions
• No Substitute for Good Parenting
Writer: John A. Davis
Publisher: Cambridge Family Enterprise Press, 2012
ISBN : 9780578101

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Books for further reading
Abstract:
This books gives an inside look at how family
relationships affect the success or the failure of the
family business. There are many conflicts inside the
family that need to be taken care of.

Families have no successions only transitions. Mark


Green explains why so many of those generational
transitions fail because an older generation of a family
blocks the natural development of later family
generation members; often he explains because of
fundamentally different world views. He then artfully
and with great experience explains how to diagnose a
generational blockage and how, with sensitivity and
tact, to dissolve it proactively toward a successful
family evolution.
Writer: Mark Green
Publisher: Palgrave Macmillan US, 2011
ISBN : 978-0-230-11184-4

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