3. Critically examine the challenges and benefits of engaging expatriates to work in foreign subsidiaries. Ensure you mention how the challenges encountered be addressed.
CASE STUDY- BRUNT HOTELS, PLC, UNITED KINGDOM
Back Ground of Brunt Hotels, PLC
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 retained 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 that 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 travellers.
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 UKbased 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 hotels outside the UK before, and has hired you team as an
independent management consultants to advise them on how to proceed. They have provided
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 the new French hotels, because more
than 70 percent of the employees from the acquired organization left.
They will require their managers to be flexible and move between countries if any
problems arise.
QUESTIONS
3. Critically examine the challenges and benefits of engaging expatriates to work in foreign
subsidiaries. Ensure you mention how the challenges encountered be addressed.
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