What Happens During a Take-Over?

Overall management challenges, improper positioning, the wrong brand, lack of commitment to guest services, lack of communication between the owner and manager, an unexperienced manager and general human resource issues are some of the factors that can send the performance of a hotel to its knees (In O’Fallon & In Rutherford, 2011, p. 376).

Nevertheless, unless the situation is very desperate, like in an undercapitalized hotel, a take-over can salvage an underperforming hotel. During a takeover, the first step is a deep analysis of the hotel including an independent analysis of its problem. During this process, the extent to which problems like lack of capital, cash flow issues, pricing and positioning, have a hand in the underperformance of the hotel is looked at. From these analysis, the take-over team can get an insight on how much the previous management veered off the track in steering the hotel.

From the analysis, the team sets up a strategy for turning over the hotel. Of course, the strategy will heavily be based on correcting mistakes done by the previous management team. The positioning of a hotel, the amount of problems that exist and the available amount of business groups are some of the influential factors in the amount of time that will take to redeem an underperforming company. However, with an effective management company, the hotel should be back on track within a year. Basically, an effective solution solely lies in the ability of investing the right amount of money in areas that really matter in the performance of the hotel. For instance, if the problems of the hotel rooted from lack of a good staff, it will only be logical to pour money in the recruitment of the right kind of staff.

References

In O’Fallon, M. J., & In Rutherford, D. G. (2011). Hotel management and operations.