Oberoi Group of Hotels

OBEROI mathematical group Understanding Strategy and Design of the Organization An Organizational Dynamics picture by root word 5 (Section G) Parth Krishnan Mannadiar (12HR-018) Priyanshi Kejriwal (12DM-104) Atharv Tilak (12DM-042) Ritu Kapse (12HR-024) Siddharth Venkataraman (12DM-143) Lov Loothra (12FN-068) Puneeth C (12IB-062) Table of Contents elder No. Heading Page No. 1. Introduction 3 2. farming and Strategy 3 4 3. Structure 4 4. close 5 5. The People 5 6. Technology 6 7. Size and Organization Life- cps 6 7 8. Complexity-Stability Model 7 . Conclusion 7-8 10. Exhibits 9-12 11. References 13 Introduction TheOberoi Group, founded in 1934, employs just ab kayoed 13000 people worldwide and owns and manages ab off thirty hotels and five lavishness cruisers as of 2012. The play along was in collectived in the socio-economic class 1949 by Rai Bahadur M. S. Oberoi to function Oberoi Group of hotels. The group of companies, affiliated through common ownersh ip interest, has to bring home the bacon initiatory class luxury hotels, airline give, airport bars and restaurants, corporate air charters, travel consultancy, limousine profits and project management.With hotels being facing pages out in Mumbai, Delhi, Calcutta, Chennai etc. , we digest see it c eachplaces almost the ideal span of the rural bea. It also has properties abroad in places such(prenominal) as capital of Egypt and Aswan in Egypt Bali and Lombok in In wear downesia Mauritius Medina in Saudi Arabia and a refreshful h grey-headeding coming up in Dubai in UAE. EIH, the flagship confederacy of The Oberoi Group is loosely preferred by credit line travellers because of its consistent and uplifted graphic symbol advantage across different locations. Exhibit 1 displays some(a) reviews post by nodes who fork out had the pleasure of sojourning at an Oberoi hotel.As puke be seen from their reviews, the main eminentlights of their stay were the ambience/facil ities and highly motivated and wholesome trained staff who add exceptionally attentive, personalised and warm service. Such a ho listingic baffle can be achieved by an giving medication through consistent efforts. and then the purpose of this report is to conceptualize these efforts which Oberoi has synergized and use it to study effective organisation outline and acculturation. Growth and Strategy Rai Bahadur Mohan Singh Oberoi was born on 15th August, 1898 in erstwhile undivided Punjab, which is set away in Pakistan.He was only six months old when his father died. Success and fortune did not, therefore, come easily to him. Initiative, resourcefulness and laborious work, combined with the capability to suit and everyplacecome the most overwhelming odds can top hat characterise this phenomenal entrepreneur. The supra words about the founder, speak of the qualities he employed to grow the Oberoi group r apiece the spinning top it is at. When M S Oberoi for the first time reached Shimla, he took up work as the desk clerk at the Cecil hotel. Today, the hotel is owned by the Oberoi Group and is called The Oberoi Cecil.The then passenger car of the hotel was happy with the work put in by Mohan Singh and asked him to assist him ladder another hotel he acquired, Clarkes hotel. With this first-hand experience of operating a hotel, Mohan Singh set out on his entrepreneurial guess. In 1934, he acquired two hotels, The Clarkes Hotel in Shimla and Delhi by mortgaging his wifes jewellery and all his assets. The Company was integrated as a public limited company in India on 26 May 1949 and its initial course sector activity was as the lessee and operator of The Oberoi castling Hotel in Srinagar, Kashmir.It was in 1965 that they construct their first hotel, The Oberoi Intercontinental, now The Oberoi, New Delhi. It offered facilities that no other hotel in the country could match and was Indias first luxury hotel. In 1966, The Oberoi School of H otel Management later renamed the Oberoi Centre for Learning and Development was formed. It provided high Quality professional training in cordial reception management. The pad list of events that shaped Oberois growth is given in Exhibit 2. Mr Oberoi was the first Indian to work in association with internationalist manacles to woo international travellers to India.This caused a large human activity of international travellers to offer their patronage. The conflicting occupancy rose to a healthy level of 85%. Mr M S Oberoi had great vision and imagination. He converted dilapidated palaces and buildings into magnificent hotels. Some of these ar the Windsor in Australia, Mena House Oberoi in Cairo and Oberoi distinguished in Kolkata. The Oberoi Cecil in Shimla, built in the early 20th century, reopened in April 1997 after extensive and meticulous renovation. Strategy Thus the Oberoi Groups dodge under Mr M S Oberois leaders was kind of clear.Since the start, they have focu sed on involution of their operations by provide to forward-lookinger markets. The finding to offer world class hotels to foreign travellers was the mind of an thought-provoking businessman looking to expand his offering. Also multi location presence helped skip concentration risk. It is this for this international image that foreign properties were acquired and assimilated into the luxury and top quality services from Oberoi. The search for lateer markets was responsible for introducing its second snitch of hotels, Trident. Trident hotels are five-star hotels that have stablished a reputation for providing the crush in excellence bundled with an affordable legal injury tag. Thus catering to the middle income segment and corporate clientele was the strategy. With this in the altogether brand, spread across nine locations in India, Oberoi now had a study parcel of land of the hotel industry. Exhibit 2 also mentions the strategic partnership with Hilton for the internati onal marketing and handling of reservations of the Trident hotels. The hotels, as part of this partnership, were to be re-branded Trident Hilton. However with Hilton exhausting to establish its own Garden inn hotels in direct rivalry with Trident caused Oberoi concern.Thus it aband aced the arrangement with Hilton and re-marketed its hotels under the name Trident itself. The Oberoi Group, a broad with its subsidiaries and other brands, stands as maven of the most decorated hotel handcuffs in the world with many an(prenominal) of its group hotels bagging various awards and accolades from Travel+Leisure,Conde Nast Traveler,ForbesandGalileo. While the business strategy and outright aggression in expanding upon has been a key to this success, it necessitate to have been supported knowledgeablely though a resilient gloss and committed human capital.Let us now try to uncover some key aspects of The Oberoi Groups culture and workforce. Structure As facilities grow in size, hotel or lodging managers find the need to group true jobs in order to learn effective coordination and operational control. While departments whitethorn be grouped as front of the house (having guest contact) and back up of the house (employees with no guest contact), Oberoi follows the practice of separating departments by function. Exhibit 4 shows the bodily structure of a typical full service Oberoi hotel.Even though such a structure is normally followed by a hotel with size over 500 rooms, the sheer size of some of the Oberoi properties require such an blow up structure. The divisional structure followed by Oberoi is in line with its culture and its objectives. The structural division promotes specialization. This specialization in turn increases worker productivity and efficiency. Culture The core set of The Oberoi Group are articulated through their dharma, which was real by their own employees. Their dharma articulates their commitment to display core values through their action and behaviour.Elements of the dharma include Conduct of the highest ethical standards a Focus on teamwork and mutual trust Maintaining excellence in guest service defend the safety, security, health and environment of guests and each other. The Dharma has more aspects as well which unneurotic apply to all aspects of the groups business (Exhibit 3). The employee is expected to bring on all decisions and all interactions based on the Company Dharma. By placing healthy mechanisms and communicating specific conduct expected from each employee, the company has do it possible to put this Dharma into action.Oberoi does not believe it is in the business of hotels, or else it claims to be in the business of memories. The company empowers its employees to believe I dont just work here. This is my hotel. The Power of 1500 Any employee in the hotel can offer anything at a cost value of INR 1500 without seeking former approval, any number of times, to any number of guests no qu estions asked. The objective is to cause guest delight. Guests who have received the power of 1500 have been happy with the service they received.The real power of this program is that because of the freedom employees have, guest get an motivator to spend more, they come back and share their positive experience by word of mouth. This directly affects the companys bottom line. Its these subtile ideological differences which make a difference in sustaining the culture over time and across borders. The People The Oberoi Group takes pride in having the go around service professionals in the industry. Throughout the year, the organization stimulates and rewards exceptional performance that best exemplifies outstanding service.Some of these awards are i) Outstanding Performance Award, ii) Employee in Spotlight, iii) Peer fruition Program, iv) Star of The Month etc. Oberoi has employees who continue to celebrate a long tenure with the organisation, in some cases over 30 years. Many of their employees have holy their certification from the Oberoi Centre for Learning and Development (OCLD) and have built successful careers up to the general manager level and in some cases senior executive grades with the corporate office. In mid-management positions, their average tenure is close to six years.As the war for talent continues across many industries, their retention strategy encompasses a variety of different elements. They undertake regular employee opinion surveys to understand employees needs. Their surveys reveal that while compensation remains an important comp 1nt for people, they are change magnitudely focused on clear career plans, access to best in class learning and building a work-life balance. By catering to these requirements, they have been successful in providing the best experience to their customers through a committed and engaged workforce. TechnologyIn the hospitality sector, ensuring the comfort of your guests is paramount. However, in todays increasingly demanding consumer marketplace, relateing that need could be a real challenge. This is in particular true for Oberoi Hotels, a luxury group of hotels favoured by government officials and business travellers. Not only does the hotel have to cater for well-heeled makers who want to make use of features such as interactive TV, IPTV and wireless networking, it also has to meet the stringent security requirements of business users who want to be sure that any(prenominal) data they access during their stay will remain secure.In addition to this, it has to ensure that its fire safety, car parking and networking facilities meet the demanding safety standards mandatory by government officials and high-profile business people. In response the hotel installed a highly obtainable and highly secure network that would enable it to deliver the security and functionality required by its guests. In terms of fulfilling the networking demands of the business itself, the solution provid es a solid, trusty platform for running all the hotels crucial applications including reservations, billing, internal accounting, and digital signage.Size and Organization Life-Cycle Size For the Financial Year ended on thirty-first March, 2012, the Companys Total Revenue was Rs 1147. 33 crores. The company posted a net profit after tax of Rs 122. 42 crores against Rs 64. 54 crores during the previous year, which is a 89. 68% growth or Rs 57. 88 Crores over YTD March 2011. It is one of Asias leading hospitality companies. Even though the company has multinational presence, there is a heap of decentralization in decision making at the lowest rung. As mentioned above, policies such as power of 1500 enable employees to exercise a fair amount of decision.This is on account of being in a business centred on customer satisfaction. This amount of leeway translates to good customer experience directly increasing repeat business and word of mouth publicity. The formalization is well set. A company operating on the scales of Oberoi needs to have well-structured and standardized operations. though the overall themes and products may differ the rules and procedures are well defined for each employ to enable him to work in synergy with the Oberoi Dharma. Life Cycle In the entrepreneurial order, Mr Oberoi didnt have to devote a mete out of time to develop a product or service.His experience in managing the operations of Clarkes Hotel already gave him generous knowhow on the business of running a hotel. Thus he could provide the strong leadership that was required to instigate the company. In the collectivity stage, again it was Mr Oberois well guided leadership which kept the sails flying high. They were focussed on expansion, but took enough time to call resources. There was enough gap between 1934 when he acquired the first hotel and when the company got incorporated in 1949.Again there was almost a 15 year gab before which Oberoi group set up their own hotel. Th ese timelines gave enough time for the tenderly formed workforce to grow along with the values of the founder and the organization. This also helped in the formalization to the elaboration stage. The rules and procedures which did get schematic were in line with the culture of the organization. This meant that the different properties established across the country or acquired world over, could inculcate the same culture all over without there being too much red tape.Decisions such as setting up their own printing run to maintain high standards all over in letter paper are an example of how stiff procedures or standards were maintained while not causing problems within the internal management. The management in different hotels did not need to coordinate now with each other for procuring same quality of stationery. Presently the Oberoi group is in the elaboration stage, with different subsidiaries handling their different businesses. They are structured in like manner and with varying controlling interests, Oberoi now is in a stable position in its sector.Its plans involve expansion and other ventures and partners to collaborate with. Complexity-Stability Model The patterns and events occurring in the environment can be described along the two major dimensions. These are the Simple-Complex and Stable-Unstable dimensions. Complexity The Oberoi Group, dealing majorly in hospitality, is subjected to Complex environmental factors since the hospitality industry has many players and has to cope with numerous dynamic governmental regulations, contender for quality employees new trends etc.Thus it is affected by numerous diverse impertinent elements. Stability The Stable-Unstable dimension refers to whether elements in the environment are dynamic. A humankind is stable if it remains the same over a period of months or years, whereas under unstable conditions, environmental elements shift abruptly. As mentioned above, there areas number of dynamic factors whic h affect the hospitality industry. With budget hotels also eating into their share by offering value for money and the economy in recession, corporates are taking their patronage to relatively greener pastures.Thus the hospitality industry and Oberoi group lay out complex, unstable environments. The Competition The major house servant competitors of the Oberoi Group of Hotels are Taj Group, ITC, De-Meligan and Leela Group of Hotels. This presents a tough competitor to Oberoi as in the luxury segment, cede exceeds demand in several cities, as per an analysis in EIH Ltds annual report. India has often been cited as one of the most lucrative albeit thorny markets to develop properties in with a long development cycle of three-five years, adding to the cost.Apart from the domestic competitors, the Oberoi group faces immediate concerns with major international brands, which are expanding their presence in India. Some of these brands are The IHG group, Wyndham Hotels, Marriott Interna tional and Hilton Worldwide. These international hotel chains are not just targeting the luxury and premium segment, but also the upscale, mid-scale, budget and f number budget segments. Another advantage to these chains is that International travellers are wonted(a) with these international chains and so it is very difficult for Indian chains to break the associated loyalty.However, to fight competition, Oberoi and its domestic competitors such as The Taj Group are looking to add newer properties, ranging from the budget category to luxury. Exhibit 4 lists out the existing hotels of International chains and the upcoming ones with their planned dates and categories. It shows how International Hotel chains are gaining ground in India and are bullish on their India expansion plans, giving tough competition to home-grown biggies. Conclusion We have just at peace(p) through the organizational design of The Oberoi Group.We have studied its strategy, its culture and people, the compet ition and business environment it operates in. So what exactly does the organization do right to cater to all these external factors and still come out as one of the leading hospitality companies in Asia and the world? Strategy is one important factor that affects organization design. Oberoi groups strategy has ceaselessly been one of expanding markets through targeting different income segments, acquiring new properties and setting up hotels in different countries.This strategy makes a lot of sense if we consider the constantly changing environment of the hospitality industry as discussed in the Complexity-Stability Model. By changing the target segment along with the market trends, the company has been able to keep up its high standards with the customers. Its present size and elaborative stage in its life-cycle also enable it to follow this expansion strategy. Due to the brand value it garners, additional investments will also continue to reap in business despite the competition . Another point to note from the unstable-complex environment of hospitality industry is the structure of the organization.As we have seen above, the structure is highly differentiated and is highly organic. The differentiation is accompanied with high integration as well. The decentralized decision making at the operation level is required to have a participative workforce working towards customer satisfaction. Seasonality, economic upheavals etc. requires a lot of forecasting and the decentralized atmosphere allows the required high speed response. Lastly, the culture of the organization which is centred on the Oberoi Dharma is also in sync with its structure and design. formalisation is high at Oberoi.The rules and procedures are well defined which implies every employee is well aware of his responsibilities. Thus he can exercise his discretion with complete freedom while making decisions. Also this formalized structure allows standardisation across its hotels across the world. Thus we can see that the design of the organization fits its workflow in a complementary manner. This has helped Oberoi keep its head above its competition and sustain itself successfully for over 75 years. The strong leadership has guided it with smart focus on targeting segments that offer new opportunities.Thus we can see that Oberoi is a good example of an organization that has used its structure and strategy to forward its business and remain successful. Exhibit 1 customer Reviews About The Oberoi, New Delhi About Mena House Oberoi Hotel, Giza, Egypt Exhibit 2 study events in the history of the Company Year Major Events 1949 The Company was promoted and incorporated by Rai Bahadur Mohan Singh Oberoi and Oberoi Hotels (India) peculiar(a), in May 1949. 1956 The comeliness shares of the Company were first listed on the BSE.Took the Maharajas palace in Srinagar, Kashmir on lease and converted it into The Oberoi Palace Hotel. 1957 Started the flight services business. 1965 Co mmenced operations at The Oberoi Hotel, New Delhi. 1968 By a scheme of merger approved by the Calcutta High Court, The Associated Hotels of India Limited and Hotels (1938) Private Limited merged into the Company. By virtue of the merger, the Company acquired The Oberoi Grand, Kolkata, Maidens Hotel, Delhi, ribbon Beach, Gopalpur-on-sea (operation suspended), The Oberoi Cecil, Shimla, The Mount Everest, Darjeeling (operation suspended). 1973 Commenced operations at The Oberoi Towers, Mumbai. 1974 Established a printing press in Delhi primarily for the Companys in-house needs. 1979 pension issue of 1,337,745 new equity shares of the Company of Rs. 10 each in the ratio of one new equity shares for every five equity shares held by the shareholders. 1984 Bonus issue of 4,953,131 new equity shares of the Company of Rs. 10 each in the ratio of two new equity shares for every five equity shares held by the shareholders. 1986 Made a foray into the airport services business by entering into a ten year contract with the International Airports Authority to operate all the snack bars and restaurants at the domestic and international terminals in Mumbai. 1992 Bonus issue of 4,720,704 new equity shares of the Company of Rs. 10 each in the ratio of one new equity shares for every five equity shares held by the shareholders. 1994 tilt of GDRs on the London Stock Exchange. 1996 Change of name of the Company from The einsteinium India Hotels Limited to EIH Limited. Bonus issue of 17,464,299 new law shares of the Company of Rs. 0 each in the ratio of one new equity shares for every two equity shares held by the shareholders. 1997 Commenced operations at The Oberoi Rajvilas in Jaipur, our first luxury leisure hotel in India. 2004 The Company entered into a strategic shackle for international marketing with Hilton International. All the Trident Hotels were re-branded as Trident Hilton, and the Oberoi Towers in Mumbai was re-branded as the Hilton Towers. 2006 Sub-div ision of the face value of equity shares from Rs. 10 to Equity Shares of Rs. 2. Bonus issue of 130,984,657 new equity shares of the Company of Rs. each in the ratio of one new equity share for every two equity shares held by the Equity Shareholders. The Company acquired a 66. 67% equity stake in atomic number 80 Car Rentals Limited, a colligation venture with Avis Europe for car rental business. The printing press established by the Company in 1974 was tending(p) permission by the Indian Banks Association to print security stationery for banks. 2008 The alliance with Hilton International ended and Trident Hilton and the Hilton Towers Hotels were renamed Trident Hotels. Establishment of EIH Flight Services Limited, Mauritius as a all owned subsidiary of the Company.Entered into a joint venture agreement with 26% equity interest in LT Bangalore Airport Hotel Limited for a hotel project near the Bangalore international airport. Terrorist combat at the Trident, Nariman Point an d The Oberoi, Mumbai in November, 2008 resulting in interruption in business and closure of both the hotels. The Trident Mumbai re-opened on 21 December, 2008, after the terrorist attack. 2009 Entered into a joint venture agreement with 16% equity interest in golden Jubilee Hotels Limited for the proposed Oberoi and Trident Hotels in Hyderabad. 2010 The Oberoi, Mumbai re-opens after full renovation subsequent to the terrorist attacks in 2008. EIH International Ltd, a wholly owned subsidiary of the Company completed an acquisition of approximately 46% of the equity interest in its international hotels joint venture company EIH Holdings Ltd. Pursuant to this acquisition, EIH Holdings Ltd is now a wholly owned subsidiary of EIH International Ltd. Source Information provided at website of EIH Ltd, a subsidiary of Oberoi Group (http//www. eihltd. com/about_eih/milestones. asp) Exhibit 3 Dharma Fundamental code of conductExhibit 4 Department Structure Exhibit 5 International Hotel c hains in India GAINING GROUND International hotel chains are bullish on their India expansion plans, giving tough competition to home-grown biggies Group Existing hotels Planned hotels** (in Rs) By when Category Planned new brands IHG* 12 150 2020 Mid-market Holiday Inn Express Wyndham Hotels 14 60-70 2017 Mid-market Howard Johnson Marriott International 18 80-100 2015 Across segments Fairfield, Ritz Hilton Worldwide 8 50-60 2016 Luxury/ premium Hilton, Double Tree, Hilton Garden Inn, mid-market Hampton,Conrad and Waldorf Astoria Accor 13 90-100 2015 Luxury, mid-scale and budget edict 1, Sofitel and Pullman Choice Hotels International 27 100 2017-19 Mid-market Sleep Inn, Cambria Suites, Econo Lodge outflank Western International 34 66 2017 3/ 4 and 5 star Best Premier Starwood Hotels 33 50-60 2015 Across segments St. Regis, W Carlson 46 100 2015 Mid-market and premium Regent Hyatt Hotels Corporation 8 50 - amplitude Hyatt Place, Hyatt House *InterContinental Hotels Group ** Esti mate Source Industry and ICRA estimatesReferences Oberoi Hotels Resorts. (2012). online. Viewed 2012 October 15. accessible http//www. oberoihotels. com/ The Oberoi Group. (2012). Careers at The Oberoi Group. online. Viewed 2012 October 19. Available http//www. oberoigroup. com/careers/index. htm SHRM India. (28/06/2012). The Oberoi Group of HotelsTranslating Dharma into Best Practices in HR. online. Viewed October 22. Availaible http//www. shrmindia. rg/oberoi-group-hotels%E2%80%93translating-dharma-best-practices-hr P Mullick, 2012, Oberoi Group Social media increasingly important as recruitment appliance, Hindustan Times, October 18 S Baggonkar, 2012, Taj, Oberoi under pressure from foreign hotel chains, art Standard, July 17 M Kaushik, 2010, Guest Star The Oberoi, Business Today, September 5 Audited Financial Report for EIH Ltd. for the year 2011-12 Oberoi Hotels and Resorts. (2012). online. Viewed October 22. Available http//en. wikipedia. org/wiki/Oberoi_Hotels_%26_Resorts