CASE STUDY:

Starting as a single hotel in a Paris suburb in 1990, the Hotel Paris is now a chain of nine hotels, with two in France, one each in London and Rome, and others in New York, Miami, Washington, Chicago, and Los Angeles. As a corporate strategy, the Hotel Pariss management and owners want to continue to expand geographically. They believe doing so will let them capitalize on their reputation for good service, by providing multicity alternatives for their satisfied guests. The problem is, their reputation for good service has been deteriorating. If they cannot improve service, it would be unwise for them to expand, since their guests might prefer other hotels after trying the Hotel Paris. Top management, with input from the HR and other managers, and with the board of directors approval, chooses a new competitive strategy and formulates new strategic goals. It decides: The Hotel Paris International will use superior guest services to differentiate the Hotel Paris properties, and to thereby increase the length of stays and the return rate of guests, and thus boost revenues and profitability. Hotel Pariss basic strategy is to use superior guest services to expand geographically. So, the management of the hotel must take steps that produce fewer customer complaints and more frequent guest returns and longer stays, and higher guest expenditures per visit. The question facing the management of the hotel, then, is this: What competencies and behaviors must our hotels employees exhibit, if we are to produce required organizational outcomes such as fewer customer complaints, more compliments, and more frequent guest returns? The HR managers task now is to identify and specify the HR policies and activities that will enable the hotel to produce these crucial workforce competencies and behaviors. For example, high-quality front desk customer service is one such required behavior.

Question 1: What are the two types of strategies followed by the Hotel Paris? Identify and justify your answer?

Question 2: From your reading of the case, you now know that Hotel Paris has decided to follow a competitive strategy. Based on what you have learnt about competitive strategy in your course HRM 301, identify what type of competitive strategy is being followed by the Hotel Paris? Explain and justify your answer.

Question 3: Do you think the HR department of Hotel Paris has a significant role in helping the Hotel Paris to follow its corporate and competitive strategy? Explain your answer.