Marriott Case Study

In Bangkok, Thailand, a group of financial investors invested in a hotel called The Regency Grand Hotel. This hotel is the most cherished hotel in town, where the employees and guests enjoy spending time at this five-star hotel. This place hosts approximate 700 employees that give fantastic benefits, year-end bonuses and ensures job security.

The Marriott Corporation (MC), had seen a long, successful reign in the hospitality industry until the late 1980s. An economic downturn and the 1990 real estate crash resulted in MC owning newly developed hotel properties with no potential buyers in sight and a mound of debt. During the late 1980s, MC had promised in their annual reports to sell off some of their hotel properties and reduce their burden of debt. However, the company made little progress toward fulfilling that promise. During 1992, MC realized that financial results were only slightly up from the previous year and their ability to raise funds in the capital market was severely limited. MC was left with little choice, as they had to

(9) Marriott puts a lot of attention to hiring the best talent and based on the results they have achieved so far, we can conclude that their assessment center and the selection process work very well. The selection process includes several steps. Each step provides Marriott with valuable information about a candidate including information about his skills and experiences. The length of the selection process depends on the position, location and number of applicants. Marriott ranks several preferred candidates and if the first one denies the offer, it proceeds with the offer to the second one, and so on until one of the candidates accepts the offer. This saves a lot of time for the company.

Marriott is renowned for its elegant and comfortable hotels and resorts. The company caters to a targeted customer base, ranging from the frequent corporate business traveler to the family enjoying their occasional weekend get-away. Marriott has continued its rise in the lodging, contract services, and restaurant industries. The company continuously strives to meet the needs and wants of its customers while strategically maneuvering the rigors of today’s competitive and ever-evolving market of glamorous destinations and convenient services. In order to remain relevant in a highly-competitive environment, Marriott must strike that successful balance of minimizing costs, and gaining and effectively

By 1980, more than 23,000 rooms were offered through 55 hotels and resorts located primarily in the U.S. Approximately 70% of company-operated rooms were owned by outside investors and managed by Marriott under agreements averaging 70 years in length. These management agreements contributed approximately $40 million to operating profits in 1979—profits that tended to rise with inflation. Contract Food Service (32% of sales)—Marriott operated almost 300 contract food units, providing a wide range of food service capabilities to a variety of clients. It was the world 's leading supplier of catering services to airlines, with 62 flight kitchens serving domestic and international air travelers. The Food Service Management Division also managed restaurants, cafeterias, conference centers and other facilities for over 200 clients, including business, health care, and educational institutions. Restaurants (25% of sales)—Marriott 's Restaurant Group consisted of 476 company-owned units offering a variety of popularly priced food in 46 states. Roy Rogers fast food restaurants and Big Boy coffee shops accounted for 92% of the total units. Theme Parks and Cruise Ships (8% of sales)—The two Great America theme parks, located in Gurnee, Illinois, between Chicago and, Milwaukee, and in Santa Clara, California, were opened in 1976. Both parks combined a wide variety of thrill and

The Warsaw Marriott case that’s assessed in this paper is a decision case where Stan Bruns (at the time general manager of the Warsaw Marriott) had to make important decisions regarding its pricing strategy and think of ways to protect Marriott’s work force from its comp set.

In the year 2000, The Ritz-Carlton Hotel Company paired with luxury real estate developer Millennium Partners to build a $225 million hospitality complex in the heart of Washington DC. This 300-room hotel was set to be the first out of a six-hotel deal between these two companies. The structure of the deal was that Millennium Partners would be the owners of the properties and The Ritz-Carlton would manage them.

Since its foundation in 1927 Marriott Corporation grew into one of the leading lodging and food services in the US. With three major business lines: lodging, contract services and related business, Marriott has the intention to remain a premier growth company. To achieve this goal the corporation’s strategy is to develop aggressively appropriate opportunities within their business lines. Marriott would like to be the preferred employer, the preferred provider and the most profitable company in each of the operating areas. The financial strategy includes four key elements:

• What is the cost of capital for Marriott’s as a whole at the prevailing capital structure vs. at the target capital structure.

The following case analysis portraits the use of capital asset pricing model to compute the weighted average cost of capital for Marriott and each of its divisions. The flow of events below is following a string of different evaluations, each of which is assessed separately.

One of the main tasks of the enterprises of various forms of ownership and spheres of activity - the search for effective ways to manage labor to ensure the activation of the human factor and achieve the best production results. The company «Hyatt Hotels Corporation» is today one of the leading companies offering hotel services. The company, headed more than 500 hotels all over the world, is of great interest as an object of study of the corporate culture, because it includes a huge number of employees (more than 30 thousand people). Hyatt Hotels and Resorts are distinguished unsurpassed quality of services precisely because of its staff. At the heart of the corporate principles of the company have the task to give our employees

Marriott International envisions itself to be the world’s lodging leader. Its mission is to provide the best possible lodging services experience to customers who vary in backgrounds, language, tradition, religion and cultures all around the world. Marriot is committed to environmental preservation through using environment-friendly technology and engages in social responsibility and community engagement.  We value our shareholder’s so we will only take steps that will ensure our growth. Most importantly, through our “spirit to serve”, we emphasize the importance of Marriott’s people and recognize the value they bring to the organization’s growth and success. It aims to increase revenues by 9% every year, to increase

Today’s organizations fail to realize the value of their customers when it comes to the success of their business. Without customer loyalty the success of your business will always be uncertain. Organizations must sensitively tailor the designs of a successful firm to the particular challenges of understanding, attracting, and keeping valuable customers. “Having satisfied customers just aren’t good enough”. Kenneth Blanchard and Sheldon Bowles, co-authors of Raving Fans, believe this concept is needed to have a successful business. I agree with this concept of customers being the focal point of any business. I would want more than just a satisfied customer; I want a “Raving Fan”.

Marriot use the Weighted Average Cost of Capital to estimate the cost of capital for the corporation as a whole and for each division, and the hurdle rate is updated annually.(WACC = (1-Tc) * (D/A) * R[D] + (E/A) * R[E])

Customer service is very important element in hospitality industry. A good restaurant or a good hotel always have an excellent service first. Hotels and restaurants put added value in their products and service make guest love it. Some hotels give guest drink when they arrived or prepare small birthday gifts to their loyalty guests. But sometimes hotels spend lots of money to added value of customers’ experience but customers still don’t like their service. So, what’s happening? Hotels gave service and improved service are not customers needed or most needed. That’s the gap between you and your customer. “You know your hotel inside out, but do you ever see it through your guests' eyes? In many cases, there is a disconnect between what hoteliers think