Most case studies of profit-making companies focus strongly on the financial performance of the firm. This case on Novotel, while in no way discounting the importance of financial performance, does not focus on financial performance. In fact, sufficient financial data are not provided in the case to support a financial analysis of the firm. Case studies of profit-making firms also focus frequently on a specific business strategy or on the appropriate business strategy for the attainment of specific organizational objectives. Again, while business strategy does underlie the essence of this case, that strategy is not the overriding focus of the Novotel case.
The problem that does provide the focus of this case analysis, however, is identified in the following section. Once this problem has been identified, it is subjected to analysis and evaluation. The analysis and evaluation of the problem then is followed by the presentation of conclusions drawn from the analysis and evaluation of the problem. Lastly, recommendations for Novotel management based on the conclusions drawn are presented.
In the early 1990s, the senior management at Novotel recognized that the business environment within which the company operated was in a state of transition. A further recognition by top management at the firm was that the organization needed to change if it was going to remain competitive in the future. After much sole searching and analysis, the company adopted a plan called Les Recontres de Futur. This plan provided for the reconstitution of the firm into a virtually new company that will be prepared to function competitively in the emerging environment within which the company must operate.
Les Recontres de Futur incorporated many important elements. Among the more important of these elements are (1) decentralized authority and responsibility, (2) a customer-centered focus, (3) employee empowerment, (4) a renewed and more open org...