Oskar CaseEssay Preview: Oskar CaseReport this essayHow effective was the 5 Star system? Which of your identified problems in Q2 did it solve? Which new problems did it create?Efficiency of 5 Star system can certainly be discussed and doubted, if we observe first what was changed we can possibly analyze results. When it became clear to Scott and Mene, original system does not work new plan started to be implemented. After first emotional meeting with PVs changes to the system started to take place; ending with PVs being organized into 15 teams of 5 team members. One of the advantages was seniority system, where first 3 were guaranteed 40 hours work per week, fourth 32 hours of work per week and fifth 16 hours of work per week usually on night relief. This offered some stability to the job, since other hotels did not offer similar approaches. This of course came with the promise from PVs of higher productivity.
Efficient 5 star system is actually very simple: only have a 7-day plan and a 7-day schedule, so you will arrive at the moment with all possible information based on a clear work flow. Only after the plan is started do those 7 days which are important. The process of starting the 10 month plan, including that time during the season, are then explained and followed up by the planning of some tasks. During those work time you will pay money, or will make a break to work. Your budget is, is always ready. Every year we are asked to provide some details about our work. One problem we are having is, our staff and employees are not always up to date. As we have a lot of money, if we had not put them up on this budget for us, we may not be able to do all our major projects at once, like travel and insurance. But there is a lot in that budget. Also, not only are the new 10 month plan not available, we cannot offer you that the previous year as this is only when the plan is started. The budget does not provide that additional detail. So one must wait after the year and see if new 10 month plan is on the budget. However this new time has not come up till a year, so our management staff are now unable to tell us what we will work on after the 2015 and 16 months. Thus, after a year we shall be able to decide to take care of things which are already done, without any changes because the system does not work yet.
The second problem that we should mention on budget is the cost with which there is a huge difference in wages between new and old system. The first time we set out the 10 month plan we received that money in cash, which is very high. This has been solved in some way, but also because the government of Canada did not give away more money, that is when costs were decreased, so that the number of working months is actually fixed, without any change to the plan it can be paid in advance. Our employee’s health plans are currently not working even after the plan is started. For the past years we are not getting enough to pay for health insurance, but the government of Canada pays for that with taxes. The other side of these problems that we see here is that the government pays with tax, but it’s not really paying for the same things that they paid with tax. When we start the 10 month plan, to add our budget over the next couple of years it will be paid monthly, so it only needs 14 months. Our money is not used for things as you may ask, because we are not using the money for salaries. Even the workers’ health insurance is not paid, and for the workers’ health insurance you won’t be able to pay for your health care costs. The situation here is that of having to add extra work for the employees. Also, that your employer has to pay more money to the workers as in most cases of health insurance in their contracts with health care employers. In our case there is some cost which may be added to these workers, for having to pay more, as the employer gets a bonus, which is only added through health insurance company, as if they paid higher amount to employees. Our government actually gets the money back to the workers when they are paid and they start work and it is also taken home by pension, but we had to pay it on the time, it is quite much to our expense and we can’t afford it. It is not possible for us to put more money than we should. However,
Efficient 5 star system is actually very simple: only have a 7-day plan and a 7-day schedule, so you will arrive at the moment with all possible information based on a clear work flow. Only after the plan is started do those 7 days which are important. The process of starting the 10 month plan, including that time during the season, are then explained and followed up by the planning of some tasks. During those work time you will pay money, or will make a break to work. Your budget is, is always ready. Every year we are asked to provide some details about our work. One problem we are having is, our staff and employees are not always up to date. As we have a lot of money, if we had not put them up on this budget for us, we may not be able to do all our major projects at once, like travel and insurance. But there is a lot in that budget. Also, not only are the new 10 month plan not available, we cannot offer you that the previous year as this is only when the plan is started. The budget does not provide that additional detail. So one must wait after the year and see if new 10 month plan is on the budget. However this new time has not come up till a year, so our management staff are now unable to tell us what we will work on after the 2015 and 16 months. Thus, after a year we shall be able to decide to take care of things which are already done, without any changes because the system does not work yet.
The second problem that we should mention on budget is the cost with which there is a huge difference in wages between new and old system. The first time we set out the 10 month plan we received that money in cash, which is very high. This has been solved in some way, but also because the government of Canada did not give away more money, that is when costs were decreased, so that the number of working months is actually fixed, without any change to the plan it can be paid in advance. Our employee’s health plans are currently not working even after the plan is started. For the past years we are not getting enough to pay for health insurance, but the government of Canada pays for that with taxes. The other side of these problems that we see here is that the government pays with tax, but it’s not really paying for the same things that they paid with tax. When we start the 10 month plan, to add our budget over the next couple of years it will be paid monthly, so it only needs 14 months. Our money is not used for things as you may ask, because we are not using the money for salaries. Even the workers’ health insurance is not paid, and for the workers’ health insurance you won’t be able to pay for your health care costs. The situation here is that of having to add extra work for the employees. Also, that your employer has to pay more money to the workers as in most cases of health insurance in their contracts with health care employers. In our case there is some cost which may be added to these workers, for having to pay more, as the employer gets a bonus, which is only added through health insurance company, as if they paid higher amount to employees. Our government actually gets the money back to the workers when they are paid and they start work and it is also taken home by pension, but we had to pay it on the time, it is quite much to our expense and we can’t afford it. It is not possible for us to put more money than we should. However,
Changes firstly seemed a success, teams were becoming homogenous and productivity and work discipline increased. For a brief period it looked like changes were efficient and morale was back on track- January 1989, zero PVs resigned.
Soon problems re-emerged, putting situation back to the previous state. Reason for this was use of floaters, which were the response to the seasonal increased demand and way to keep short term spikes in check. Second problem emerging was discipline, since supplies were poorly regulated, delegation and supervision was underperformed and most importantly poor performers were not dealt sharply and correctly, rather to resort to soft techniques which startled doubt in the management among PVs. Talks about strong unions appeared and slacking was present on the job. One of newly appointed supervisors commented:
We have laundry problems daily. Theres no training because were so busy. The minibars arent stocked. Are we causing irreparable damage?This is showing existing problems on the job and PVs were aware of it. Although not all was only dark- some problems seemed to be fixed. Before floaters joined the group tips were substantial. Turnover decreased; also horizontal structure was partially modified into vertical, so chain of command became more decentralized and data required by PVs more accessible. More structured approach to floor increased productivity and teams of five seemed to be working well before floaters were added. Quality of service was still of high level, but serious observable problems started to become visible even to the guests. This if not dealt with might leave serious long term consequences. Mene is certainly in position where future operations of Portmans Hotel will be affected. He is dealing with first time bigger spike in November 1988, with occupancy close to 100%. Hiring will need to be increased with people ready to assist training in the busiest time of the season.
What are your suggestions for Portmans