Assignment: Brunt Hotels Goes Global Case Study
Brunt Hotels, PLC, owns more than 60 hotels throughout the United Kingdom. They recently acquired a small hotel chain headquartered in France. Brunt's chief executive decided that half of the new hotels in France would be retrained and rebranded as part of the Brunt Hotels Group; the other half will be sold. This will support Brunt's strategic objective of growing the organization slowly to make sure the new ventures are well supported and opened on time and on budget.
Brunt's hotels are considered budget accommodations; they are functional, clean and reasonably priced. Most guests stay for one to three nights and are a combination of business and leisure travelers. The hotels are typically situated in downtown locations that are easily accessible by mass transit. Tourists are attracted to these hotels in popular visitor destinations where the many local attractions mean that they will not be spending much time in their hotel rooms.
The organization has decided to use an ethnocentric approach and send some of their existing UK-based managers to France to lead the changeover of the new hotels and then manage them after they re-open. If this new overseas venture is successful, Brunt may decide to acquire other small hotel groups in other European countries. The organization would like to own 150 hotels in the next five years. Their 10-year plan is to own 300 hotels across Europe. This is an ambitious target, so it is important that the organization finds an effective formula to operate successfully in other countries.
The organization has never owned any hotels outside the UK. If Brunt Hotel's international expansion were to succeed, they would require ongoing assistance on a range of interconnected issues wherever its business took it. Seeking out new sources of help as each issue arose would be distracting and exorbitantly expensive. What Brunt Hotels needed was a long-term partner in its international expansion - one that could provide comprehensive services across the globe. So they have hired a team of independent management consultants to advise them on how to proceed. They provided the consultants the following information during their initial meeting:
• A majority of their existing managers said they would like a chance to work abroad.
• None of their existing managers speak French fluently.
• They will allow four weeks to rebrand the hotels. The new hotels must be ready to open after that time.
• They expect to recruit a large number of staff for new French hotels, because more than 70 percent of their employees from the acquired organization left.
• They will require their managers to be flexible and move between countries if any problems arise.
Questions
1. Did Brunt Hotel's select the correct partner?
2. What cultural concerns do they need to be aware of for doing business in France?
3. What should the immediate prioritizes be for Brunt Hotel's?
4. Should they hire host country (France) employees or use parent country (UK) employees?
5. What should their short and long term goals be? Make sure to develop these using SMART goals.
6. What action steps need to be taken to reach these goals?
7. How will this impact their HR department? What HR strategies need to be put into place?
8. In the long term Brunt Hotel's want to expand into other European countries? What should this continued expansion strategy look like and how will it impact their HR department?