This proposal draws the clear picture of the reasons behind the downfall of the very popular ancient hospitality organization with the 60 years of glorious history of The Roaring Dragon Hotel (RDH). This proposal helps to find out the factor which causes the RDH to lose all the customer popularity and decrease the revenue in the competitive market. The main concerning points behind this miserable downfall are the cultural conflicts between the staffs of the hotel and new management committee, newly implemented strict organizational policy, complete organizational restructure, change in management committee, and lack of proper training to the existing employee to prepare the RDH hotel for the competitive market. In order to overcome those issues management should understand the cultural and communication gap exists from the side of the employees and build up friendly relationship with them. Also management should focus on providing adequate training to the employees so that every individual actively involve and understand the value of this change and how much this is necessary for the growth of RDH to sustain the position in the competitive market and keep the revenue intact.
The Roaring Dragon Hotel (RDH) is a three star state owned hotel in South-West China, had a very glorious history since 1950 till before it had been acquired by Hotel International (HI) (Grainger, 2008). To capture the growing tourism market and compete with other international branded hotels Chinese authority decided to upgrade the hotel into international standard and given full permission to HI to renovate RDH as required. Starting from May 1999 through December 2002 researched were made to achieve guanxi as a four star hotel (Park & Luo, 2001). The total renovation was invited for almost all the sectors of RDH. The renovation also demands environmental changes which interlink human involvement of the organization for the cultural changes (Jackson, Keenan & Sirkin, 2005). For a successful transformation, the employee participation is a very essential step to walk forward. It also demands acceptance of the new cultural changes among the employees, follow the new vision with the management of the organization (Jones & Aguirre, 2004).
The Roaring Dragon Hotel (RDH) is a state owned Enterprise (SOE) and most popular hotel in South-West China in the mid 60’s economic era. Due to its SOE connection it used to privileged with any government delegates, officials and state guest visit. The hotels staff also used to get benefit of all the facilities for being a SOE employee (Grainger, 2008). After being enjoying long 40 years of prestigious SOE privilege and glory, RDH started facing difficult time at the year of 2000 with the competitive market with other international Hospitality brand. After the organization handed over to International hospitality brand HI it is decided to complete restructures of the organization which potentially cause an employee laid-off and new work culture adoption (Thomas, 2004).
The HI management hired the new group of management people and replaces the old committee members. The existing staff stared facing challenges deal with the new management and work environments with the newly implemented set of rules. It gradually increases the dissatisfaction among the employees with ultimately degrade to poor service quality of the hotel. Due to these cultural gaps between the hotel staffs and management committee it decreases the reputation and caused high turnover (Grainger, 2008). In 2003, the provincial government decided to terminate the contract with HI to recover the reputation of RDH and decide recruit back the previous management committee.
Few of the major problems with HI management are highlighted below: The management failed to communicate with the existing employees and overlooked to understand their need to maintain the glory of RDH. The new HI management not succeeded to build trust with the hotel’s staffs and newly implemented corporate strategies made employees unsatisfied to obey HI management decision. This cross culture attitude difference between the staffs and management leads to the poor quality service to the customers, as a result gradually decrease the customer popularity into market (Stephenson, 1960). As RDH transited from SOE to private owned organization, so it losses huge government related customer contacts, it impacted the revenue in a large scale (Grainger, 2008). Huge number of employee laid-off by the new HI management caused bad reputation in the market and throw challenges to sustain the old glory of RDH (Grainger, 2008). Complete restructure of the all departments of RDH and new implemented corporate policies by new committee made existing staffs unhappy to continue their services under HI management (Grainger, 2008).
The HI management has opportunity to more concentrate on sustaining 60 years long glory of Roaring Dragon Hotel and maintains the good customer reputation in the market rather than focusing on new policy implementation. To keep on retain competitiveness in the market it was required to involve individual employee, listen their valuable feedback and understand the local cultural background and the need of the customer (Grainger, 2008). They also think to build up a friendly work atmosphere for the employees and make an easy to approach to the management environment so that every staffs of the organization enthusiastically take part on the organizational growth and know deeply the value of the restructure of the hotel and why it is so much necessary to achieve the goal to make RDH competitive to the growing hospitality world.
Human resources are the assets of the organization. Employee’s contribution and dedication helps the organization to sustain the pride and glorious history in the market. Though HI management implemented new strategies to make RDH competitive in the market, but because of the cross cultural employee dissatisfaction and complete organizational restructure failed to achieve the competitive goal (Wursten, 2010). By overlooking and misunderstanding the ethnic gap between employees and HI committee, loses business contacts and leave a negative reputation in the market.
The new management should have been tried to reach individual staffs for their valuable feedback, provide adequate training to make employee accept the newly implemented policies and build friendly relationship in the organization (Stephenson, 1960). Management should have more concentrate on the employee satisfaction and build up even more stronger relationship with existing RDH customer along with stress to create relationship with new group of customer. The employees should have been provided adequate and appropriate training, new policies should have implemented reward base performance evaluation along with annual bonus for the encouragement of handwork of the staffs and to make acceptance of the new policies (Jones & Aguirre, 2004).
The great learning from the Roaring Dragon Hotel case study is that in spite of having a long glorious history, due to the change of management committee RDH faces miserable downfall in the market. It happed because of the cross cultural difference between the local Chinese people and European Hotel International management. The HI management completely ignored to notice the employee’s dissatisfaction toward the new changes and lack of proper communication made RDH great downfall.
Conflict between staffs of the organization and the management is a quite a well-known issue in the business world. By this case study we get overall pictures of the causes which direct an organization to great misery and we can draw the precautionary measures for overcoming the mistakes in future to achieve the business goal.
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