Direction: Read the case study below and answer the following questions:

1. Who are the stakeholders?

2. Define the strategy of Oaks Properties. In other words, what type of unethical practices and behaviours have taken place within the organization?

3. What Impact did the strategy have on internal customers?

4. There are four levels of ethics in organizations: Societal Issues, Stakeholder Issues, Internal Policy Issues, and Personal Issues. Which of the four levels of ethics is identified in the case? Provide one or more examples of issues at each level you identify.

5. What could Liza have done in this situation?

6. Make predictions about the future of Oaks Properties and give reasons for why you have made these predictions.

Liza Slater was a Property Manager with more than 10 years of experience specializing in resorts and 20 years in the hospitality industry. She had previously been the Director of Property Management for Seaside Plantations, a beach resort located on Bayside Island that catered to both families and convention business. In this position, Liza was responsible for the communication between the resort operating company and the individual owners of the condomimiums in Seaside Plantation's rental program. Liza had been in this position for five years and had developed a good working relationship of trust and mutual respect with the condominium owners. She left the position because of her family and their growing needs. - Two years later a powerful storm struck the island and nearly destroyed Seaside Plantations. Liza felt a responsibility to reurn to the resort to help the property owners, who had experienced great losses, both economical and emotional. Becuase most of the condominium owners lived in other, distant locations, they desperately needed an agent on the island to help them through the reconstruction period and to prepare their villas again for rental. Time was of the essence, as most property owners had suffered enormous loss of rental income as a result of the storm. - The original property management company for whom Liza had worked had offices and front desk check-in on the premises. This company closed, however, after the storm and was eventually sold to a new company, Condomuniums, Inc, who then occupied the vacated space. In the meantime, Liza accepted a position which a competitor, Oaks Properties, a prominent resort rental company. Oaks Properties owned and operated two other villa resort rental programs in the area and had just purchased a villa rental company on Bayside Island that was located 3 miles from Seaside Plantations. Inasmuch as Oaks Properties did not have previous rental experience on this island, they were particularly interested in hiring Liza because she was so familiar with the Seaside Plantations property, the property owners, and their condominiums. Liza's responsibilities included the day-to-day supervision of the office, including reservations, front desk acitivities, and property management functions, as well as overseeing both the housekeeping and maintenance operations. Although she lived at the resort, she had to travel the 3 miles to the office and was on call 7 days a week, 24 hours a day. - Marketing was handled exclusively by the home office located on another island. The owners of Oaks Properties had decided to compete aggressively on Bayside Island in an effort to increase their market share in both reservations and number of villas in Case Study 2 - their Seaside Plantations rental program. They used the Seaside Plantations name throughout all of the advertising without specifically identifying themselves as Oaks Properties, a rental/property mangement agency for the resort. This strategy was carried into their brochures, telephone advertising, and conference sales. Prospective guests assumed they were reaching the on-site reservations office for Seaside Plantations, rather than a separately located rental agency. Callers thought that they were making reservations directly with Seaside Plantations and that their stay would include certain amenitites of the resort. Bookings made through the competing on-site property management company, Condominium, Inc., for instance, offered golf and tennis privileges at reduced rates, a free summer children's program, free transportation within Seaside Plantations, and convenient charging privileges at the front desk for all food and clothing outlets. Although Oaks Properties offered slightly lower rental rates, its front check-in desk was located 3 miles from the front gate of the resort, it did not offer special amenities, and it required full payment for the accommodations within two weeks of booking the reservation, which was nonrefundable 14 days prior to arrival. Although Liza did not approve of Oaks Propertie's strategy, she initially had some ability to correct the misperceptions of potential guests by instructing her reserviations staff to provide complete information to the guests when they were inquiring or booking reservations. - During the second year of operations, Oaks Properties's management decided that the three reservation offices located on separate islands should be consolidated, and the reservation function was moved to the main office. Becuase of this move, the satelite operating office that Liza managed no longer had control over the information that was given to the prospective guest prior to making the reservation. Management also decided that the staff should be cut in half on Bayside Island because this office no longer handled reservations. This did not allow for sufficient staff to handle the problems of the property owners or geust services. - Difficulties for Liza and her staff began soon after this consolidation. Oaks Properties invested heavily in marketing its properties. All types of advertising had the name "Seaside Plantations" prominently displayed, with only a small-lettered notation of "Oaks Properties" and the address. The reservations office, now under control of the home office, answered the telephone, "Seaside Plantations Reservations," not "Oaks Properties." The 800 directory listed "Seaside Plantations Accommodations." which in reality was the 800 number for Oaks Properties. - The change cuased a great deal of confusion for guests, particularly in regard to check- Case Study? - in procedures. Because many of the guests did not realize they were renting through Oaks Properties, they would go to the main resort front desk, run by Condominiums, Inc., where they would be directed to the Oaks Properties office, 3 miles away, to check in. During the busy summer months it was not unusual for guests to slowly creep along in congested traffic to reach Seaside Plantations, where they would then wait at the front desk only to be sent back the 3 miles. Often the delay caused by the check-in confusion would be more than 45 minutes and was typically endured in subtropical heat. Many guests had small children in their cars and had been traveling for several hours. By the time then finally arrived at Oaks Properties to check in, they were hot, tired, and terribly irritated. - Oaks Properties policies gave Liza and her staff no way to appease these guests. They could merely point out that no misrepresentation had occured, inasmuch as the name and address of Oaks Properties did appear on the brochure and reservation confirmation. The only positive information they could provide was that Oaks Properties's rental rates were slightly lower than those of Condominiums, Inc. In addition, because the deposit was now nonrefundable, guests would foreit their money if they did not keep their reservations. - Although this was an extremely upsetting situation for Liza and her staff, there were other equally distressing occurrences. Oaks Properties did not operate its Bayside Island office, including the front desk, on a 24-hour basis. When the office closed at 8:00pm, check-in information was left in a box for the guest to pick up. Guests arriving late at night, most having gone directly to the resort first, were greeted by a rental packet and key when they returned to Oaks Properties. Often the security office or the front desk of Seaside Plantations would call Liza at home to handle an irate guest. On these occasions, she was forced to leave her two children unattended, sometimes after midnight, to unlock the door of a condominium while trying to calm the guest. Even if the staff and Liza survived the check-in, there were other troubles. Included in the summer rates charged by Comdominiums, Inc. at Seaside Plantations was a free allday children's program. Many family visited the resort during the summer, and this was an importnat amenity. A sign was prominently displayed on the main road by the resort that read "Registration for the Children's Program." Although the program was available only to guests who booked through Condominiums, Inc., all guests driving to their accommodations could not fail to see this sign. Guests who had made their reservations through Oak Properties would often try to register their children in the program, only to be told that they could not. Once again Liza and her staff had very angry guests on their hands, and once again they could only point out that the guests Case Study 2 - paid a lower rate for the accommodations through Oaks Properties. - In addition to Liza's misgivings regarding the marketing and management practices of Oaks Properties, its compensation policy further complicated her predicament. Liza was paid a base salary that no longer met her financial needs. The company had eliminated any base salary increases and had decided instead that any additional compensation would be received in the form of a bonus for performance. Part of the bonus it paid Liza was based on how much she "comped" guests to appease them. Although Liza often felt that a guest was entitled to some recompensation, the less she "gave away" in the form of complimentary gifts or services, the more she received for her bonus, She was also paid a very large fee every time she obtained a new rental unit for Oaks Properties. This put her in the position of having to be aggressive in securing villas for its rental program when she did not personally feel that its operating methods were ethical. - Liza's integrity and values were very important to her, but as a single parent she felt she had no alternative except to do her best for Oaks Properties until another comparable position could be found. She was also bound to Oaks Properties by her