The Roaring Dragon Hotel (RDH) was constructed in south-west China in the 1950s as a state owned enterprise (SOE) and was viewed primarily as a premier guest house for visiting dignitaries and officials, Communist party members and guests. Up until the late 1990s hotel management had little concern for profit and primarily focused its efforts on serving and meeting the needs of officials and party members. Like many SOE hotels at that time, the RDH wastherefore characterised by overstaffing, archaic work practices and technology, unsystematic production systems and a dysfunctional motivation system unrelated to performance. The majority of managers were untrained and internal family cliques within the hotel departments were prominent.
After extensive research, the RDH board chose to partner with Premium Hotel Services (PHS), a mid-sized global hotel training company. After negotiations were complete, PHS were contracted to come to the hotel and upgrade all the employees skills between October 2005 and October 2006. During this period the hotel would be closed for reconstruction,thereby providing the opportunity for employees to partake in full-time training.
The first representatives of the PHS team arrived in September 2005 and their initial goal was to assess the hotel’s existing standards of servicequality and subsequently design a training program that would achieve the five-star objective.
After a short time the PHS staff recognised that in addition to the cultural issues previously identified, upgrading the hotel faced a range of modern problems associated with China’s economic and social development. For example, due to the developing Chinese market economy, changing government labour policies were enabling employees to change jobs more easily; as well as their place of employment from one city to another. Under the former planned economy conditions this had been forbidden or very difficult to do. With increased demand for quality employees to staff the growing number of new hotels in the region, competition for quality hotel staff had emerged.
A related issue concerned the emerging one-child generation. This group had not previously experienced the difficult living and working conditions that were encountered under China’s planned economy. They wanted opportunities ‘now’ and were confident enough to change jobs if their existing conditions were not suitable.
The social environment in the vicinity of RDH was also changing. Nearby, one could now find clubs presenting live modern music every night to young customers from one-child backgrounds. In contrast, during the day, hundreds of older Chinese people from large families would gather in the vicinity of the nearby park to play traditional acoustic music, chess-like games and enjoy old style dances and customs together.
Collectively, these conditions meant the RDH human resources department had to work harder to retain their good employees and to attract young recruits. Younger employees now had less concern about having a secure position with a famous five-star hotel like the RDH. They were more interested in making money and short-term outcomes were their priority.
1. Failure of the initial management training program undertaken by HIG was attributed to the cultural characteristics of Guanxi and Mianzi. Explain what these terms mean and give examples of how they might have contributed to failure?
2. What competencies from the Rational Goal and Internal Process quadrants of the CVF are evident in management of the RDH prior to 1999? Support your answer with reference to the Assumptions and Goals of each quadrant.
3. Assume that you are a member of the PHS training team. Explain how you would introduce the CVF to members of the RDH management team and how they might use the model to help with their management efforts?