The Arts Property and Hotel Case Solution
Identification of the case problem or central issue
Language and working environment generate problems in planning and construction. The case has so many problems relating to the industry, the hotel, and the Carlos Martinez. In order to define it articulately;
Industry
- The expansion has no defined path: Mr. Faus is keen on expanding the hotel in order to satisfy the short-term investor, however the expansion does not have a defined path which can create future problems.
- The undefined market in the hotel market: Immediately after the Olympics, the hotel market suffered a sharp decline in the hotel’s performance. As a result,the market was undefined in the hotel market.
- The event of September 11: Despite the September 11, 2001, great tragedy which negatively affected the hotel industry, the hotel's operating performance proved more flexible than originally thought.
- Luxury hotel market industry: The presence of the luxury hotels in the hotel market industry could create problems for the new company.
Hotel
- Changes in structure: He made the new structure ownership based on the one that Sogo had, as they had aimed not to pay the taxes.
- Aligned Goals:The lack of focus of the previous presidents on Mr. Real Cortez created difficulties in aligning the goals of the company.
- Market Positioning: It was difficult for the new management to identify the optimum market positioning for the new hotel.
- Budget Constraints: The new hotel is significantly constrained by the availability of the funds which is creating a lot of problems for the future.
- Ponder the value of business
- Expansion with an undefined path
Carlos Martinez
The problem with Carlos Martinez is the same as the other two that the expansion cannot be done in an undefined path. Moreover, he does not have much knowledge about the business and regarding the reconstruction. Moreover,the business is un evaluated and Martinez’s strategy is unknown.
Discussion of 2-3 alternative solutions to resolve the problem
The above-defined issues can better be solved by taking the three alternatives in mind:
1) Clean the project and sell it
2) Hire a consultant company
3) Hire new employees
Positive Consequences of the alternatives
As there is so much uncertainty in going with the same management, therefore it is better to clean the project and sell it which is the best solution among the three alternatives. The current management with Mr. Real Cortez is a risky one as he has the right to transfer the key personnel of the project which can create future problems, thusit is better to hire a consulting company and hire new employees.
Negative consequences of the alternatives
The alternatives as described above can be costly for the new management in terms of hiring new consultants and hiring new employees as there is a significant budget constraint. Moreover, as there is already the shortage of skilled employees in the market, the chance of failures do exist. The presence of the competitors is also creating a threat for this new project.....................
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