1. What is the problem statement in the following situation?
Companies benefit through employee loyalty. Crude downsizing in organizations during the recession crushed the loyalty of millions. The economic benefits of loyalty embrace lower recruitment and training costs, higher productivity of workers, customer satisfaction, and boost the morale of fresh recruits. In order that these benefits may not be lost, some companies, while downsizing, try various gimmicks. Flex leave, for instance, is one. This helps employees receive 20% of their salary, plus employer-provided benefits while they take a 6-12 month sabbatical, with a call option on their services. Others try alternatives like more communication, hand-holding, and the like.
Problem statement. How can employee loyalty be maintained during periods of downsizing?
2. For the following case titled Sleepless Nights at Holiday Inn (published in Business Week and adapted here): a. Identify the problem
b. Develop at least four hypotheses.
Sleepless Nights at Holiday Inn
Just a few years ago, Tom Oliver, the Chief Executive of Holiday Hospitality Corp., was struggling to differentiate among the variety of facilities offered to clients under the Holiday flagship – the Holiday Inn Select designed for business travelers, the Holiday Inn Express used by penny pinchers, and the Crowne Plaza Hotels, the luxurious hotels meant for the big spenders. Oliver felt that revenues could be quadrupled if only clients could differentiate among these.
Keen on developing a viable strategy for Holiday Hospitality which suffered from brand confusion, Tom Oliver conducted a customer survey of those who had used each type of facility, and found the following. The consumers didn’t have a clue as to the differences among the three different types. Many complained that the buildings were old and not properly maintained, and the quality ratings of service and other factors were also poor. Furthermore, when word spread that one of the contemplated strategies of Oliver was a name change to differentiate the three facilities, irate franchises balked. Their mixed messages did not help consumers to understand the differences either.
Oliver thought that he first needed to understand how the different classifications would be important to the several classes of clients, and then he could market the heck out of them and greatly enhance the revenues. Simultaneously, he recognized that unless the franchise owners fully cooperated with him in all his plans, mere face lifting and improvement of customer service would not bring added revenues.
How can brand awareness be brought about to increase the revenues of Holiday Inn?
1. The more differentiated the building facilities, the more the brand awareness.
2. The more differentiated the maintenance of the facilities, the more the brand awareness.
3. The more differentiated the services to the clients, the more the brand awareness.
4. Differentiated building facilities, maintenance, and service will influence brand awareness only if the Franchise owners cooperate and actively promote the idea of differentiation. If they don’t, no amount of differentiation of the three independent variables will help clients to understand the differentiation (increase brand awareness).