Agenda

Case overview Mission statement Levels of goals/plans Criteria for setting effective goals High performance approaches to planning Strategy insight Michael Porter Keith Houcks strategy Key trends Conclusion

ART JOHNSON, ACCOUNTANT KEITH HOUCK, CONSULTANT

DAVE KING, HOTEL OPERATIONS CHIEF

TONY BRIGGS, MARKETING HEAD

KAREN SETZ, HR DIRECTOR

Case Overview

H.I.D currently owns 21 properties: - 10 Holiday Inns and 2 Quality Inns all in Georgia. - 8 hotels in Canada and 1 in the Caribbean. Bill Collins, the president of H.I.D, advocates for adding 27 properties in 5 years and 50 in 10 years. He also wants to move to newer cities and explore new opportunities.

Case Overview (contd.)

The senior management is of the opinion that only 15 hotels in 5 years and 20 in 10 years could be added. Senior managements concerns for the presidents vision: - H.I.D would outpace its income - doesnt have sufficient manpower nor have the financials to hire additional people - continue to focus on smaller towns due to lesser competition; and - not move to newer cities

Mission Statement
H.I.D strives to exceed the expectation of our guests by providing excellent value in well-run hotels located off the beaten track. In this way we will meet our profit, quality and growth goals.

Levels of goals/plans and their importance

Mission Statement Strategic Goals/Plans Senior Management Tactical Goals/Plans Middle Management Operational Goals/Plans Lower Management

Criteria for setting effective goals

Specific and Measurable

Cover key result areas

Challenging but realistic

Defined time period

Linked to rewards

Pros and Cons of Presidents goals

Pros:

Cons: No certain road map to meet his goals No clarity on planning from top to bottom Lack of Communication

Ambitious Ready to stretch limits Strong vision Rapid growth

Rapid expansion as big as this entails a risk if not planned properly

Pros and Cons of senior managements goals

Pros:

Cons: Risk averse Unwilling to move away from their comfort zone Lack of motivation

Clear consensus in their vision

Well aware of limitations involved

High performance approaches to planning

Strong mission and vision

Set stretch goals for excellence

Embrace event driven planning

Use performance dashboards

Organise temporary task forces

Ambiguity

Presidents Vision

Senior Managements Vision

Strategy Insight

Strategy Framework -MBO

Management by Objectives (MBO). MBO is a systematic and organized approach that allows management to focus on achievable goals and to attain the best possible results from available resources.

MBO
STEP 1: SET GOALS Corporate Strategic goals Tactical goals Operational goals
Review Progress & Take Corrective Action

STEP 2: DEVELOP PLANS Action Plans

Appraise Performance STEP 4: APPRAISE OVERALL PERFORMANCE

STEP 3: REVIEW PROGRESS

Keith Houcks strategy

Develop an action plan.

Raise the required capital. Plan to expand by 4 new hotels every year which should give 20 at the end of 5 years. Review progress yearly and take corrective action, if any. Appraise overall performance.

Keith Houcks strategy (contd.)

An opportunity to tap promising markets will lead to an increased international presence.

The proposed expansion will lead to growth opportunities, authority and responsibility for the employees as well as provide them with the choice of locations, if any. These activities will give an impetus to growth and thereby increase their revenue.

Tactical goals
Human Resource Finance Marketing

Forecasting Recruiting Selecting Training Appraisal

Raising capital Funds allocation Budgeting

Plan, design and develop Promotion and publicity Market analysis and trends Review progress

Where to expand?

Asia shakes off recession with dynamic growth

Emerging markets heat up the tourism industry

Asia increasing its market share as a destination this year with a 11% growth rate

SOURCE : As per the world travel trends report of 2010 discussed at the World Travel Monitor Forum, held in Pisa in November 2010. At the annual event, organised by IPK International and sponsored by ITB Berlin

Key Trends

Europe: low growth outbound & inbound North America: low single-digit inbound growth outbound; high

Asia: double-digit growth outbound; high singledigit inbound

At a regional level, Asia Pacific, South America and the Middle East are expected to see the strongest growth in inbound tourists this year.

Key Trends (contd.)

Worldwide tourism growth rates

Key Trends (contd.)