Roaring Dragon Hotel - Analysis

Introduction:

The advent of internet and the rise of technology, communication and media by the last part of 20th century caused the world to "shrink" in a sense. This led to businesses and industries plan for expansions to grow as well as compete globally and maximize profits. These projects also led to conflicts arising out of cultural differences, language barriers and resistance to change. Resolving and dealing with these conflicts is very important to achieve organizational success.

Background:

Roaring Dragon Hotel (RDH) which has colorful history and reputation is in decline and efforts to shore it up are failing constantly primarily because of the employees not buying into the process and the incoming vendors using inappropriate strategies. The most recent effort by the provincial government to help stop this decline, improve profits and help RDH realize its potential by contracting with a reputed international company Hotel International (HI) (with the financial backing by Erhi T) has also effectively failed.

Problems:

The primary reason for the numerous negative results and symptoms such as attrition of employees, losses, incurring debts, contractual disputes, insubordination and many others is the deep rooted work culture present at RDH. Because of this, employees were resisting change and did not have a sense of ownership towards the company. Moreover, the strategies used to fix these issues which included wholesale changes were oblivious to the cultural aspects and they made the situation worse, resulting in contractual disputes, miscommunication which eventually caused them to fail (and thereby revert to old practices).

Opportunities:

There is an exciting opportunity to overcome existing cultural and language barriers and transform RDH into a hotel of international standard, Not just that, but this could set a template in setting up such well established hotels in South-West China. This would also enable the management to establish and maintain good relationships with clients such as tourism companies and government officials for the benefit of the company. Also, develop a group of employees that are motivated, sincere, well-equipped, professional and satisfied. Also an opportunity for HI to use this experience to get similar projects and use these learnings and this success story to increase its presence in China as well as countries of similar culture.

Recommendations:

 There are changes needed at various levels some wholesale and some subtle. It is not only important to win the support of (ex) G.M. Wen but also make each and every employee from the G.M. to Bartenders to buy into the whole process by effectively communicating with them the Vision, goals and objectives.

 To overcome cultural challenges, both the employees (especially managers) of RDH and HI need to be educated on each others' cultural aspects. If HI was educated on how to minimize negative affects of intra-company connections (guanxi) and positively use inter-company connections, it would've made a world of change to the whole transition. The connections of employees could've been used to maintain and win relationships with clients which could've avoided the losses. The training programs also need courses on ethics and illegal use of time and resources.