business improvement plan - sonesta international hotels corporation

1

Module Assignment: Controlling and Evaluating- Part B

2

Table of Contents


3

Declaration of Own Work


4

Management Summary

This report is a Business Improvement Plan that the management team has

come up with for Sonesta International Hotels Corporation. We have come up with a

new mission statement as well as a slogan for the Hotel Chain. Before coming up

with a strategy the hotel needed to be benchmarked with its competitors; through

which one is able to find out the areas in which improvement and innovation is

necessary. Sonesta is a comparatively small brand; and the team decided on four

basic strategies so that the hotel can have a competitive advantage over the bigger

brands.

The four main strategies that the group has come up with are follows: ‘Go

Green!’ which is about environmental certification and showcases the organization’s

s path towards social responsibility. The improvement of Guest Loyalty Program

proves that Sonesta appreciates its guests and is building towards offering them

many benefits. The E-HRM Strategy makes one see that Sonesta not only thinks of

the community and its guests but wants to make life easier for its employees as

well. The last strategy consists of offering more discount packages; through this

Sonesta will be able to reach to a more diverse market group.

These strategies have been discussed in detail in the following chapters.

Sonesta hopes to put itself more in the public eye and these plans will help the

Hotel Group not only to be a step ahead of its competitors; but to strive towards a

more sustainable business.


5

Introduction

This assignment has been written in partial fulfillment of the module: Controlling and Evaluating.

Our PBL group performed as a Management Team for this assignment. The assignment

concerns ‘Sonesta International Hotel Corporation’. The management team consists of and

covers the following departments:

General Managers: Aisha Daga & Janna Geertsma

Food and Beverage: Amy Mcleod & Lotte Bedijn

Rooms Division: Thozama Kate Mayezana, Lyzette Kappelhof & Koen Vinke

Sales & Marketing: Leigh-Anne Cawood, Emile van Niekerk & Karlijn Scholtes

Human Resources Management: Jerker Duenk & Phiwe Salukazana

The assignment includes a mission statement for Sonesta International Hotel Corporation; an

external analysis of the hotel chain as well as a benchmark analysis divided into the four

departments. Sonesta International Hotel Corporation has been benchmarked to Marriott, Hyatt

Hotel Group and Starwood Hotels and Resorts. Through the help of these findings; the

management team came up with a TOWS Matrix. This matrix was used as the basis for the

strategies that the team came up with. The best of these strategies have been selected for the

business improvement plan; an overview of which is given in the management summary above.


Step 1 6

MISSION STATEMENT – SONESTA INTERNATIONAL HOTELS CORPORATION

Slogan: “Your window to the world”

Sonesta has many different chains and hotels (30+ all over the globe). Sonesta prides itself on

the fact that every one of its establishments displays the cultural values and encompasses the

environment and location that it is in. Every enterprise has its individual feel and depending on

the locale – has different attributes. A guest from another city/country can actually feel what the

host city is like. There is no “chain” feeling to Sonesta’s multiple establishments.

Mission Statement:

“The Mission of Sonesta International Hotels Corporations’ is to provide unique travel

experiences to its guests, with a personal touch and passion from all its employees”.

Vision Statement:

“To expand globally, and provide an unadulterated landscape with original experiences of the

host city; emphasizing on the focus on excellent service standards throughout every enterprise.”

Goals:

Instill and include the highest standards of business ethics for all our activities.

Stress not only on Consumer Satisfaction; but Employee Satisfaction as well.

Achieve excellent quality via dedicated and motivated staff.

Constantly improve and strive towards efficiency and effectiveness in our endeavors.

Explanation:

The Sonesta International Hotel Corporation holds on the values that have made them a

respected member of the travel industry for over 60 years. The core purpose of the company is

to add value to the lives of the guests, employees, property owners, suppliers, shareholders,

and members of their communities. They want to meet and exceed their expectations, and they

want to treat them with dignity and respect.

Sonesta has a variety of hotels at different locations; what sets it apart from their competitors is

the actual buildings and décor of each hotel which is different and exemplifies the city it is in.

Guests receive the highest standards of service at all Sonesta Hotels; but they will find that

every hotel has its own distinguishing characteristics.


Step 1 7

Sonesta’s mission is to provide unique travel experiences to its guests with a passion and

personal touch from its employees. This matches the mission of globalization; which is living

experience other than one’s own city; it is also in lieu with its core goals which are to apply

ethical business practices – whether it comes to the consumer or the employee. They

understand that a lot of an organization’s success depends on its workforce. Even though they

don’t have a standard look for all of their hotels – they still pride themselves on their excellence

in service. They not only want to satisfy their customers but strive to exceed those expectations.


Step 2 8

EXTERNAL ANALYSIS OF THE ENVIRONMENT

The external analysis of the market and environment is performed to identify the opportunities

and threats for Sonesta International Hotels Corporation. The PESTLE model has been used so

that one can perceive the Political, Economic, Social, Technological, Legal and Environmental

external impacts to the organization.

Political Factors:

Terrorism

The impact of terrorist activities is not something one can overlook. People are still

scared of travelling to far off places. The security measures put in by the government –

body searches at airports and so on; are a hindrance and can be quite invasive. This

deters people from travelling.

Terrorist threats, though have decreased international travel have increased intra-

regional travel. The US has seen an increase in people travelling within the country.

Government:

The US Department of Labour is investing a lot in the Hospitality Industry; with regards

to training and giving grants. Thus enabling a skilled workforce to be created.

The accommodation and food service sector makes up approximately 8% of the national

population in the United States.

The Hospitality Industry is expected to add 17% in wage and salary employment within

the next 5 years. Jobs are expected to increase by 16% as well. Sonesta focuses on

having a good relationship with employees and it will benefit from the help that the

government is putting in for the industry.

Global:

International travel is encouraged, with countries and governments trying to make it as

easy as possible. Egypt and the United States have a very healthy relationship and

encourage tourism.


Step 2 9

Economic Factors:

Financial Crisis:

The financial crunch caused a lot of stress for every industry; but now with things coming

back to normal – people are ready to spend again.

Taxes:

The taxes on cigarettes and alcohol have increased and are probably going to amplify

some more. This is going to affect the hospitality industry as they are going to have to

increase their prices as well.

Seasonality

Hospitality is very seasonal. Not all times of the year are as busy as the others. But this

can be used to an advantage by looking at trends and making changes when it comes to

high or low season.

Disposable Income

Disposable income is on the rise. Smaller families and an increase in singles is a

contributing factor as well.

At the moment there is a lot of corporate travel, with organizations sending their top

managers to remote places and developing countries as well.

Competition

The hospitality industry is highly competitive and to obtain a competitive edge the

organization needs to constants improve and innovate. The main competitors being

resorts, hotels, and other international chains.

Social Factors:

Consumer attitudes and opinions:

Today’s consumers are open to new experiences and ideas.

They want the best and do not hesitate to pay for it.

They applaud innovation and excellent service.

With globalization, the world has become a much smaller place.

Media views:

Every country has a tourism board and they do their utmost to promote themselves.


Step 2 10

The media has a very strong impact on tourism and the industry.

Positive PR is a must for any organization.

Education:

People are well educated and know what they want. They desire value for their money.

Individuals do not mind spending more as long as they get the required experience.

Health

Travel for health reasons is on the rise.

People lead very stressful lives and thus they prefer taking holidays that will relieve them

of this stress.

Some organizations provide for the same as well.

Hotels need to make sure that they have a plan to take care of their guests’ needs – with

regards to allergies; by providing anti allergy duvets, pest control measures and so forth.

Leisure Time:

Individuals today are more inclined to travel. They work hard at providing for themselves

and so want to spend time on themselves as well. Short holidays are on the rise. They

want to experience as much as they can.

Technological Factors:

E-HRM

With E-HRM technology; most of the HR procedures can be completed online itself. This

leaves the HR Managers to spend more time in strategic planning and implementation.

E-HRM is a good tool to use, especially when there are companies in different locations

involved. It helps to standardize procedures and puts the organization on a more global

level.

It requires some initial investment and has quite a few costs involved; the returns can

only be seen in the long term.

Voice over Internet Protocol (VoIP):

This is a system through which phone calls can be made over the internet. This also

allows video conferencing. Availability of this technology decreases call charges

dramatically and there is not a lot of operational costs involved. The main point being

that the hotel has internet connectivity.


Step 2 11

Wifi access:

A large number of hotels have Wifi Access in their rooms.

Nowadays a large number of hotels are providing free Wifi Access; not only to their Gold

and Platinum card customers.

Room Automation Systems :

“The Guest Room Authentication System enables hotel owners to provide their guests

the convenience of controlling multiple functions in their rooms including lighting,

temperature, drapes, and audio/video systems using automated interfaces.” (Pacific

Controls)

They help reduce energy consumption, can be easily added to other automation

systems.

Inncom is one of the largest in this technology.

Lack of personal touch:

Due to the fact that almost everything now is being computerized; it makes things very

impersonal.

For a hotel to go the extra mile, they need to have skilled and motivated employees.

Legal Factors:

Anti- smoking bans – Hotels have to adhere to them. This causes discomfort to some

customers. Provisions have to be made.

Increase in tax on tobacco and liquor.

Every country has their own laws; this makes it difficult for international organizations, as

not all practices are the same.

Environmental Factors:

Certifications:

Guests are environmentally conscious. They prefer staying at accommodation which

does its part for the Earth.

Green Globe Certification, ISO Certification; Eco Label and so on are a few of the many

certifications that hotels can work towards.

Hotels are mostly concerned with waste removal – recycling and power consumption.

Renewable Resources

Hotels now are using environmentally friendly materials during construction.


Step 2 12

Some hotels use recycled paper for their correspondence.

Establishments have also started using solar energy and geo thermal energy for heating

and lighting purposes.

The Table below indicates the perceived external opportunities and threats for Sonesta

International Hotels Corporation, using the PESTLE Analysis as the basis.

OPPORTUNITIES THREATS

POLITICAL Grants from government. Terrorism

Positive relations between countries

ECONOMIC Economic Stability Increase in taxes

Competition

Seasonality

Disposable Income

SOCIAL Educated consumers Require attention

Want innovation

Media Coverage - exposure Negative PR

TECHNOLOGICAL Advanced Technology Constant upgrading

Reduces Costs in long term Requires investments

LEGALInternational laws – country/ region specific


Step 2 13

ENVIRONMENTAL CertificationsLaws regarding waste management.

Use of renewable resources Policies – during construction


Step 3 14

THE BENCHMARK HOTELS

The group has chosen the following three hotels as the benchmarks for Sonesta International

Hotels Corporation: Marriott International Inc., Starwood Hotels and Resorts Worldwide Inc.

and, Hyatt Hotels Corporation.

Looking at the table below one can see that all the hotels have a common factor – being that

they are all based in The United States of America. These are international brands with chains

all across the globe.

These are luxury hotels with very high standards. Their clientele consists of the higher income

brackets. From their mission statements one can identify that they all share the same basic

focus; on providing the ultimate customer experience.

At the moment, Sonesta is not as big or well known a brand as the others, but this is why it

makes sense to benchmark against them. These hotels are mostly under the 3-5 star

categories; which is the same as Sonestas’. Since there is no uniform system of classifying and

grading hospitality outlets; that fact has not been stated in the table. Sonesta needs to find out

where it needs to improve and upgrade so that it can reach its full potential.


Step 3 15

Sonesta International Hotels Corporation

Marriott International, Inc. Starwood Hotels

and Resorts Worldwide Inc.

Hyatt Hotels Corporation

Headquarters

Boston, MA – United States of America

Bethesda, MD – United States of America

White Plains, NY – United States of America

Chicago, IL – United States of America

Mission To operate outstanding hotels in unique locations in a manner that achieves the following four goals: practice the highest standards of integrity and ethics in the way we conduct our business; value our employees as individuals; exceed customers' expectations; deliver service with passion.

We are committed to being the best lodging and food service company in the world, by treating employees in ways that create extraordinary customer service and shareholder value

To our shareholders, our goal is to grow EBITDA at least 8-10% per year and EPS at least 15% per year. To our customers, we want Starwood to be the easiest company with which to do business. And to our employees, our commitment is to make Starwood a great place to work

To provide authentic hospitality by making a difference in the lives of the people we touch every day.

Brands Sonesta Hotels

Royal Sonesta

Marriott Hotels and Resorts

JW Marriott Hotels and Resorts

Le Meridien

Four Points

Westin

Grand Hyatt

Hyatt Regency

Park Hyatt


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Step 3 16

Renaissance Hotels

EDITION Hotels

Autograph Collection

Courtyard by Marriott

Residence Inn by Marriott

Fairfield Inn and Suites by Marriott

Marriott Conference Centres

TownePlace Suites by Marriott

SpringHill Suites by Marriott

Marriott Vacation Club

The Ritz-Carlton Hotel Company, LLC

The Ritz-Carlton Destination Club

Marriott ExecuStay

Marriott Exectuive Apartments

The Luxury Collection

Aloft

Sheraton

Element

St. Regis

W Hotels

Andaz

Hyatt Resorts

Hyatt Place

Hyatt Summerfield Suites

Hyatt Vacation Club


Step 3 17

Locations North America

Caribbean

Central and South America

Egypt

North America

Brazil

China

France

Germany

Japan

Latin America

Caribbean

South Korea

United Kingdom

Ireland

Australia

North America

Europe

Africa/Middle East

Asia Pacific

Latin America

North America

Asia

Europe

Latin America

Caribbean

Australia

New Zealand

Africa/Middle East


Step 4: Rooms Division Benchmark 18


Marriott International, Inc.

Starwood Hotels and Resorts Worldwide Inc.


Restaurant Every Hotel has at least one restaurant, with good food at a fair price

Good cuisine is an art!

Every Hotel has at least one restaurant, with good food at a fair price.

World class restaurants.

At Starwood they have a passion for food.

Every Hotel has at least one restaurant.

Every Hotel has at least one restaurant, with good food at a fair price.

Products and service

Finest and freshest ingredients.

Regional and international cuisine, as well as simple snacks.

Diverse menus.

Elegant dining accessories. All the restaurants have a wonderful décor with different themes.

They serve ‘Green’ and healthy food, on request, in meetings and events.

Unique blend of quality, consistency, personalized service.

“Good Food and Good Service at a Fair Price"

"Do Whatever it Takes to Take Care of the Customer"-Pay extraordinary attention to detail

Use their creativity to

Disease fighting products, and healthy food, due to high antioxidant and nutrients.

Starwood Hotels are distinguished by magnificent decor, spectacular settings and impeccable service.

Starwood Hotels are a sensory multiplex.

Food is fresh, seasonal, spiced and flavour-packed.


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find new ways to meet the needs of customers

Dinning types

All the hotels offer Breakfast, Lunch, Dinner and brunch on weekends.

Offer a Light bar menu, which is for the rest of the day.

Some of the hotels make use of buffets.

All the hotels offer Breakfast, Lunch, Dinner, and they offer snacks.

All the hotels offer Breakfast, Lunch, Dinner.

They also have Gourmet Buffets.

All the hotels offer Breakfast, Lunch, Dinner and Brunch during weekends.

Wine Menu Available.

Extensive wine lists.

Finest wine lists.

Marriott has designed an encyclopedia of wine, which is condensed into a user-friendly, portable manual for easy referencing.

All wine lists are simplified and made into a “progressive wine list.” - they are put in to a list from light bodied to heavy bodied.

Actual wine tastings are in place for guests to test the wine that they might drink later that night.

Available.

Finest wine lists.

Extra Provides Catering, Room Service, and High Tea.

Food is available during meetings and other events.

Provide food at meeting and events, such as weddings, business meetings and green meetings.

Provides Room service.

Offers food at meeting and events.

Helps to plan the F&B

Provides Room Service.

They have a Tea Cellar.



There is a children’s menu.

Children below twelve years are not charged for their meals.

Nile cruises: provide meals.

Complimentary coffee, tea and snacks in the lobby.

part of guests honeymoon.

Design/Atmosphere

Each hotel has a different theme/design/atmosphere.

The restaurants often have the same theme as the rest of the hotel.

Casual atmosphere where everyone feels warm, welcome and at ease.

Starwood offers a seductive environment of glamour and comfort

The atmosphere gives a sense of enjoyment where one can socialize and entertain.

Bar Every hotel has at least one bar.

Pool side bars, and bar services.

Some of the bars have nightly live shows.

Focuses on intelligent bar design, high-quality products and exemplary execution.

All juices used in cocktails are fresh.

Each Marriott property is equipped with standard recipes from the BarArts

“On trend” bars.

Swanky rooftop bars.

Famous for its 11th-floor rooftop terrace bar, a trendy outside bar.

Every hotel has at least one bar.

Cozy wine and champagne bars with a great ambiance.

Juice bars.



program and guidelines to create property-specific concoctions.

Lounge Yes, often with a dance floor.

Yes, there are many different lounge areas.

These areas all have their own set dress code and one can choose from a casual to a more formal setting.

“On trend” lounges.

Intimate lounge spaces - reserved exclusively for guests.

Yes.

Serve light meals and after dinner drinks.

Tea and other drinks in lounges

Terrace Sweeping terrace with majestic views.

Hotspot for entertaining.

All Marriott Hotels have terraces with exquisite views.

Rooftop terraces.

Some rooms open up onto a secret garden terrace.

11th-floor rooftop terrace bar.

All luxury Collection Hotels guest rooms have terraces with breathtaking views.

Outdoor dining terraces

Many of the rooms have terraces.

Beverage Wines, cocktails, hard and soft drinks, beers, champagne.

Served in the restaurants, bars, lounges and poolside areas.

Served in the bar, restaurant, lounge and poolside areas.

Beverages are served in the bar, lounge, restaurant, terrace and poolside areas.

Wines, cocktails, hard and soft drinks, beers, champagne.



Entertainment

Some of the hotels have a Discotheque, or Casino.

Bars and restaurants available.

Many Marriott hotels have their own restaurants done up so well that it enhances the dining experience.

Top class bars.

Whappenings: club that certain hotels have on their grounds.

Offer cutting edge music, lighting and scent programs.

In-room spa treatments at every hotel.

Hyatt provides food and catering at all kinds of meetings, and events like weddings, and social events.

Non smoking policy

Most of the hotels have a non smoking policy.

Most of the hotels have a smoke free policy.

The first hotel chain to go smoke-free in North America.

Most of the hotels have a non smoking policy.



FOOD AND BEVERAGE DEPARTMENTAL BENCHMARK ANALYSIS

Since we are not benchmarking one hotel against the other; a group of hotels against other

groups. One thing to keep in mind is that not all the hotels of the same chain are of the same

size and capacity. A bigger hotel may have more bars and restaurants as compared to a smaller

one of the same brand.

The one distinguishing factor to consider is the extra services that these hotels offer –

entertainment facilities, lounges and so on. All of the hotels emphasize greatly on the quality of

service. Sonesta does have many of the same facilities; but the strengths and weaknesses table

below shows the areas where improvement is necessary.

STRENGTHS WEAKNESSES

Entertainment: Discotheques, Casinos, Live shows at bars, lounges.

Not all the hotels have these facilities. Develop a brand identity by having clubs/discotheques unique to their brand.

Extensive Wine Lists No personalized wine lists.

Food Services: Catering, High Tea, Light Bar Lunch, Brunch.

No option for ‘green menus’.

Complimentary coffee and tea in the lobby.

No tea cellars.

Children under the ages of twelve eat for free.

Cruises.







Number of Rooms Worldwide

31-36 hotels worldwide, 7783 rooms

Over 450 hotels worldwide, 180,672 rooms

993 hotels worldwide, 287,017 rooms

730 hotels worldwide and more than 136,000 rooms

Type of Rooms Standard Rooms

Deluxe Rooms

Pool & Patio rooms

R club level rooms

Bourbon balcony rooms

Standard rooms

Deluxe double and twin

Superior twin and king

Superior suite

Cozy rooms

Wonderful rooms

Spectacular rooms

Mega rooms

Studio rooms

Fantastic rooms

Marvelous suite

Wow suite

Standard rooms

King size

Twin size

Deluxe king

Deluxe twin

Suite King

Executive king

Presidential Suite

Room Rates Advance purchase discount

AARP rate

Spa package

Family package

AAA rate

Membership rate

Government Rate

AAA Rate



AAA rate

Government employee rate

Just for girls rate

College club rate

Royal bed & breakfast rate

Golf packages

Standard rate

Just for kids rate

Citizen rate CAA membership rate

Citizen rate

Prices as per room

$189-$1800 $165-$1900 $220-$990 at discount value

$162-$1200

Occupancy rate

71.2% in 2009 63.4% in 2009 62.7% % in 2009 61.8% in 2009

Rev Par 129.42% in 2009 92.09% in 2009 99.15% in 2009 100.1% in 2009

Rev Par index 111.4% in 2009 111.9% in 2009 111.2% in 2009 111.7% in 2009

ADR 181.74% in 2009 145.16% in 2009 158.25% in 2009 158.45% in 2009

Check-in 3:00pm 4:00pm 1:00pm 2:00pm

Check-out 12:00 noon Prior to 2:00pm 4:00pm at latest Prior to 3:00pm



Room Service 24 hour room service 24 hour room service 24 hour room service 24 hour room service

Hotel Amenity Menu

Yes(order in room) yes yes yes

Laundry and Dry cleaning services

yes yes yes yes

Facilities, features and Activity centers

Shuttle services

Concierge

24 hour health club

Business center

Gift shops

Conference rooms

Social events

Weddings facilities

Swimming pool

Spa services on site

Concierge services

Baby sitting/child care

Gift shops

Fitness facilities

Conference rooms

Escape packages

Social events

Spa services onsite

Swimming pool

Conference rooms

Spa services on site

Swimming pool

Business center

Vacation packages

Stores

Fitness room

Conference rooms

Spa services onsite

Swimming pool

Self service office flat-panel HDTV

High-speed Wi-Fi internet access throughout the hotel.

Amenities in rooms

Flat screen TV Daily housekeeping Air conditioning Air Conditioning



In room safe

Iron and board

Desk with high-speed wired and wireless Internet

Cordless phone with voice mail

Mini Bar

In-room movies and video games

Pillow top mattresses and king size pillows

Hair dryer and make-up mirrors

Guest suites with separate living and sleeping areas

Fully equipped kitchen

Work space with data ports and voicemail

Complimentary continental breakfast

Coffee maker

CD radio

Internet Access

Lap top port

Hairdryer

In house movies

Satellite/ cable TV

IDD/ DDD

In suite shower and bath

LHS/VCD/DVD &CD player

In room safe

Mini bar

Tea and Coffee making facilities

Alarm Clock Radio

Bathrobe, Hair Dryer

Coffee/Tea maker

Complimentary Coffee

Direct Dial Telephone

Electronic Door Locks

Handicap Accessible

In-room Safe

Iron/Ironing Board

Modem/Data Port Connection

On Command Movies

Refrigerator

Remote Control Color Cable TV

Shower Massage



Voicemail



ROOMS DIVISION BENCHMARK ANALYSIS

The Benchmark Analysis of the Rooms Division Department reveals that Starwood Hotels and

The Hyatt Hotels have more variety when it comes to the type of rooms. The Occupancy rate of

71.2% in the year 2009 indicates that Sonesta has a much higher rate as compared to the other

Hotel Chains; but one cannot forget that it also has a smaller number of hotels and rooms

overall. Regarding the facilities available; all of the hotels have a majority of the same type of

amenities in their rooms. The Hyatt International has automated services in their rooms and

indicates that their rooms are handicap accessible as well.

Since the Hotel Chains are classified between 3-5 stars; the extra amenities available are again

quite similar. Sonesta provides a shuttle service to its guests, which is a good concept. The

room rates differ depending on the type of hotel, the room chosen as well as the season. The

Starwood hotels have the most affordable rates, but only at discount prices and not on hotel

prices.


Variety in the types of rooms Higher prices on their rooms

wedding facilities No complimentary breakfast within packages.

Well equipped rooms No room automation software

Provide shuttle services No free Wifi access in all the rooms.

Business centers. Provide more corporate discounts and packages.

EPA Energy Star, Green lodging certified. Need environmentally friendly room amenities.

24 hour health club No advertised babysitting facilities for most of their hotels


Step 4: Sales and Marketing Department Benchmark 30





Chain Sonesta Collection (hotels, resorts and cruises)

Own chain with different hotel types.

E.g. Marriott hotels & resorts, Renaissance hotels, Autograph hotels, Residence Inn and different suite hotels and a vacation club.

Starwood Hyatt Hotels and Resorts

Stars 3-5 Star Hotels 4 - 5 stars hotels 4 – 5 Star Hotels 3-5 Star Hotel and Resorts

Number of Hotels

31 Hotels in total in which 5 of those are river cruises.

12 more hotels either in construction, or approved for

3,100 Hotels 979 Hotels 216 Branded Hotels and Resorts with over 90,009 rooms.



construction

Conference rooms

Function space

Convention centers

Ballrooms

Boardrooms

Conference Rooms

60 meeting and resort hotels: Equipped with boardrooms, conference rooms, convention centers and video conferencing.

Provide Wedding facilities as well as wedding planners

Yes.

Most properties offer conference centers, convention centers and boardrooms.

Executive Boardrooms.

Meeting Facilities.

Large Convention and Conference Rooms.

Exhibit Space.

Internet access

WIFI internet Access.

High-Speed Wired Connectivity

WIFI access is free of charge in every hotel.

Most have internet access.

Some have WIFI facilities in which guest can explore the internet free of charge

High-Speed Wireless.

T-Mobile HotSpot.

High Speed- wireless.

Wellness Majority of the hotels offer a health club as well as Jacuzzi and spa facilities.

Sports - squash etc.

Only the hotels which operate under the sub-brand Marriott Hotels & Resorts have a spa en wellness centre.

Outstanding are the ones in Napa Valley

Majority of the hotels offer Spa and wellness facilities.

Most properties offer gym/ fitness facilities and sporting activities.

Many of the hotels and resorts offer fitness such as skiing, golf, scuba diving, sports, tennis as well as fitness centre’s.

Majority of the hotels have a spa facility in



‘Marriott Hotel & Spa’ and the ‘Harbor Beach Marriott Resort & Spa’ hotel. These hotels have the spa as their core selling point.

In Edinburgh, Scotland: A golf resort with its own golf course.

which the guest can enjoy to relax and unwind.

Hyatt has brand called Hyatt pure which is a worldwide collection of spas.

Discounts Parking and Over night accommodation are discounted in areas around Colleges and Universities.

Discounts on accommodation rates vary between dates as well as seasons and location.

Discount is given to Military & Government, Seniors (15%)

Discount is also given to American Express card users (5%).

AAA hotel discount

American Express card holders receive discount, this works in conjunction with the Starwood preferred guest program.

Any member of American Express receives a 3% discount on their stay and other hotel purchases.

Parking Valet parking is available but some hotels offer this facility at a certain cost.

Offer a shuttle service that ensures guests get around easily during their holidays.

Parking facilities are there but not always free of charge.

The average charge for car parking is 30 Euros per day.

Most of the properties have safe parking

All the hotels of the Hyatt cooperation offer parking facilities whether it be on the premises or not.



Standard packages

N/A Nickelodeon Family Weekend Package for children.

Escape! Package deals which have different themes but always includes 2 nights and breakfast.

The Escape! Packages are available in Family, Golf, Romance, Spa, Local and Dining.

Family holiday package – 50% off the second room and children eat for free.

Timeless weekend package.

Weekend taste of luxury: weekend package.

Hyatt as a cooperation offers 4 different standard packages which include:

Amour- Romance Package

Balance- Relaxation Package

Awaken- Bed and Breakfast Package

Explore- Local Discovery Package

Place Boston

Miami

New Orleans

Orlando

St.Maarten

Brazil

Peru

Chile

Colombia

Marriott has hotels all over the world including:

Armenia

Austria

Belgium

China

Czech republic

France

Germany

The top hotels in this chain are located in:

New York

San Francisco

Las Vegas

Orlando

Chicago

Paris

Los Angeles

North America

South America

Central America

Asia

Africa

Europe

Caribbean/Bermuda

Australia/New Zealand

Middle East



Egypt

Opening Soon in:ArgentinaCosta RicaMexicoSan CarlosFlorida

Hawaii

Indonesia

Italy

London

Caribbean

Rome

Indian Subcontinent

Hawaii and Specific Islands

Promotion Internet as well as Facebook

Television

Lifestyle, Buisness and Travel Magazines

Newspapers

Brochures

Their own website

Magazines

Brochures

Travel Agencies

Internet

Travel agencies

Magazines

Online travel agencies

Internet

Home page and internet sites such as Facebook

Magazines

Brochures

People The staff at Sonesta are friendly and warm and practice the highest standards of integrity and ethics in the way they conduct their business.

They exceed customer’s expectations and serve customers/guests with

The staff of Marriott view their associates as their greatest asset. They believe that they are people serving people. The Marriott culture is the experience they provide for their customers, which is demonstrated by the behavior of their

The staff members of Starwood are committed, dedicated and motivated staff members.

They are caring and take pride in ensuring that all service is executed perfectly. They dedicated to creating an

Each staff member at the Hyatt hotel chain is dedicated to providing authentic hospitality by making a difference in the lives of the people they communicate and come into contact with everyday.

They are passionate about making a positive



passion. Their purpose is to add value to the lives of the people they interact with and they ensure that they treat each guest, employee, shareholder, supplier etc. with the highest of respect.

associates.

The staff members are dedicated to providing guest satisfaction through service excellence, strong corporate culture and inspiring core values.

environment of inclusion and exclusiveness.

They dedicate themselves tirelessly to exceeding guest expectations and are well trained in providing the best of hospitality.

and lasting impact on their guests and corporate relations . As all hotel staff they are dedicated to exceeding guest’s expectations and making their stay as enjoyable as possible.

Guests Loyalty Program

Travel Pass: a loyalty programme which begins offering guests rewards on their first visit

Guests receive personal preferences and special amenities and are notified via email when special offers and news is available.

Yes: Marriott rewards.

As a Marriott Member special prices are given.

Points are saved by using the Marriott rewards gold card to book flights, stay’s and retail.

Points can be exchanged for free stay or goods.

Yes: Star-Point system.

SPG (Starwood Preferred Guest) is a programme where one is rewarded with star points for every stay in one of the hotels.

Depending on the number of visits, points are allocated; which determine the type of card: gold, platinum or preferred.

Yes. Many guest loyalty programs.

American Express card members are given special offers and receive a 3% discount on stays and other hotel purchases.

Hyatt Gold Passport membership: members receive exclusive rewards and benefits for being a member.

Cooperation Close corporate relationships with Meeting Planners, Travel Agents, Tour operators and Charter Companies

Through the Marriott website one can book airplane tickets for the 60 major airplane company’s all over the world such as

Ties with American Express.

They also have

Offer Travel Packages (Air, Hotel and Car).

This can all be booked at the same time through the hotel in



KLM, British airways, and air France and US airways Car rental company Hertz.

Work together with wedding planners, bakeries and floral shops and offer complete wedding packages.

cooperation with 32 different airlines.

which the guest wants to travel to; thus enabling transport and accommodation bookings at the same time.

Environmental consciousness

Sonesta has many awards regarding Environmental Sustainability such as:

Green Lodging Award

Energy Star (Environmental Protection Agency)

Marine Environment Award (5-time winners) in which outstanding dedication to the clean up of the marine environment by ocean conservancy is awarded.

Royal Sonesta Hotel has become a sponsor for workshops on social and environmental

Environmentally conscious.

Currently Marriott calculated their carbon footprint which shows that they are aware of their input to the climate change.

Started a fund raiser to maintain the rainforest.

Offer ‘green meetings’: These are meetings where the environment is taken in consideration with everything. E.g. paper use. The type of

Adhere to environmental Laws.

Regulated usage of polychlorinated biphenyls, which may be present in electrical equipment.

Adhere to the laws that state that the business can be liable for personal injury or property damage because of various environmental conditions such as alleged exposure to hazardous or toxic substances, poor indoor air quality, radon or poor drinking water

Implemented a global environmental training programme to train all staff of Hyatt worldwide to teach staff additional ways of reducing their environmental impact in hotels and in their own homes.

Environmental Mission to minimize in areas such as:CarbonWasteEnergy ConsumptionWater Consumption

Hotels are also implementing Sustainability Programmes to reduce



responsibility. coffee served, etc.. quality. the hotels overall carbon footprint and environmental impact.

Distribution Integrated Reservation System.

They have 30 properties worldwide

Online business planner and reservation; group and room checking.

step-by-step-planning guide

They have more than 100 properties worldwide.

Online as well as telephonic reservations.

Hyatt E-Concierge Online Planner.

Telephone & online Reservation.

Direct Corporate Reservations



SALES AND MARKETING DEPARTMENT BENCHMARK ANALYSIS

All the hotel chains have three to five star hotels within their hotel chain. Sonesta seems to have

the least amount of hotels as they only have 31 hotels in total and therefore are the smallest

hotel chain in the benchmark, but Sonesta has the competitive advantage as they offer cruises

which the other hotel chains do not. Sonesta also has the least number of brands as they only

have six brands which is a lot less than the other hotel chains.

The hotel chains offer similar conference and wellness facilities as all the hotel chains offer spas

and fitness centres. They also offer similar facilities such as mini-bars, room service, and

parking. Sonesta is the only hotel chain with a few hotels that do not offer free internet access to

all their guests.

Discounts are offered at all the hotel chains that were benchmarked. Each hotel chain offers

different discounts due to location, type of guest, economic position etc. Each hotel chain also

offers standard packages which also differ according to their circumstances.

All the hotel chains are worldwide and the countries vary from Africa, Europe, America, New

Zealand and many more. The channels of promotion and distribution are more or less similar

with each hotel chain.; but Sonesta has a wider range of promotional tools and therefore has a

competitive edge over the other hotel chains.

A guest loyalty program is offered at each hotel chain but this is where Sonesta has the

disadvantage as their Guest Loyalty Program is not as rewarding and appealing than the other

hotel chain’s guest loyalty programs and therefore there is need for improvement. Each of the

hotel chains have some form of cooperation but Sonesta seems to stand out in this matter as

they have a very close corporate relationships with other businesses and companies such as

travel agents, meeting planners, tour operators and charter companies which give Sonesta the

competitive edge over the other hotel chains.

Sonesta is the only hotel chain that does not have an environmental certificate and therefore

they could work towards getting one as a common trend on the hospitality industry is to be

recognized as an environmentally friendly business.



The table below highlights the Strengths and Weaknesses of Sonesta International Hotels

Corporation:


Guest Loyalty Programme They only offer one guest loyalty program that doesn’t offer as much as the other hotel chains.

Marketed and promoted through internet and other modes of media.

Need more exposure. They do not provide enough information regarding their hotels. They need to market it more extensively.

Environmental Awards: Green Lodging Award, Energy Star, Marine Environment Award

Sonesta hasn’t completed an environmental audit as yet. They are not as environmentally conscious as the other hotels.

Close business relationships with different corporations such as travel agents, tour operators etc.

Need to develop more corporate ties nationally and internationally.

They have a number of properties around the world, and have projects under construction which shows they are expanding.

Do not have branches in Africa and Europe. They are a much smaller hotel chain with only a few brands.

They pride themselves in state-of-the-art buildings and are dedicated to providing a local cultural experience

Not all Hotels offer free internet access.

They have 3-5 star hotels therefore proving Sonesta is a quality hotel collection.

They offer cruises unlike their competitors


Step 4: Human Resource Department Benchmark 40





Recruiting Use:

http://jobs.trovit.com

Vacancies posted on their own website.

Via multiple job sites.

Vacancies posted on their own website.

Various job advertisements on the internet.

Vacancies posted on their own website:

On site and various others

www.explore hyatt .jobs/

www.catererglobal.com

Company benefit

Group A 30%Group B 15%Group C 7,5%Based on performance and hotels REVPAR and profit. Amounts are the maximum possible percentage of salary

Retirement:pension plan which covers all non-union salariedemployees, at its executive offices and owned and leased hotels, As well as some

Medical, dental, life & disability insurance

401(k) retirement savings plan

Continuing education/tuition reimbursement

Work/family programs and services

Discounts on hotel rooms, food &

Comprehensive, low cost health insurance for employees and their family

Dental and vision insurance coverage

Company-sponsored retirement plans (U.S. 401(k) program)

Life Insurance and Disability Insurance

Flexible Spending Accounts

Medical, Dental and Vision Insurance

Prescription Plan

Disability

Retirement Savings Plan

Basic, Supplemental and Dependent Term Life Insurance

Personal Time Off or Vacation, Sick and


http://www.explorehyatt.jobs/

http://jobs.trovit.com/


of its managed hotels.

Benefits are based on the average compensation for the highest sixty consecutive months of service during employment andthe employees’ years of service.

beverage

Ongoing training & career development

Employee Stock Purchase Plan

Employee Assistance Program

Adoption Assistance

Domestic Partner eligibility

Holiday Time

Complimentary Hotel Room Nights

Employee Assistance Program

Work/Life Balance

Education Assistance



Training N/A Management Development Program (MDP): a self-paced, individual development program designed to provide entry-level Marriott managers with the knowledge and skills necessary to perform their jobs and provide exceptional guest service

Cornerstone Learning and development program.

Cornerstone OnDemand helps organisations to empower their people and optimize workforce productivity

Cornerstone provides over 30,000 pre-integrated training titles.

(www.destinationcrm.com)

Hyatt Regency Perth is the first Hyatt in Australia to launch the PacificSchool of Hospitality.

The programme is a joint initiative between Hyatt Hotels Australia, Mint Group Australia and theDepartment of Education and Training, and emphasizes a continued focus on employee training and customer service.



Employee satisfaction

There is no information stated about staff satisfaction, but they emphasize on staff motivation and satisfaction.

N/A Interviews with staff on a website shows that most of them enjoy their work and the organization

(www.glassdoor.com)

Classic Residence by Hyatt in Reno Won "Best Place to Work" Award in 2007.

The anonymous surveys focused on 10 criteria of a satisfying working environment including: team effectiveness, trust with coworkers, manager effectiveness, feeling valued and people practices, among others.

(www. hyatt classic.com )


http://www.hyattclassic.com/


HUMAN RESOURCE DEPARTMENT BENCHMARK ANALYSIS

When analyzing the recruitment section of Sonesta; in comparison to Marriot, Starwood and

Hyatt, it is evident that all of the Hotel Chains use similar recruitment techniques which consist

of job advertisements on their websites, and other mediums like the internet and Newspapers.

The Employee Benefits also show similarity. Sonesta and the other three groups all offer basic

employee benefits like Health Insurance, Education and Training and Retirement Packages.

However, a major difference can be noticed in the Training Department. Sonesta’s employee

training information is not as easily accessible as Marriot, Starwood and Hyatt. The others seem

to offer an array of staff training programs while Sonesta seemingly does not. Staff satisfaction

does not seem to be publicized much for Sonesta. The other Hotels have tangible information

about their staff satisfaction but Sonesta seems to only have their own emphasis on how they

are serious about staff attention on their company websites.


Special bonus system for all employees in the company, based on the performance of the employee. Up to 30% of the employee’s salary Grants from government.

No assistance plans for employees such as for adoption and life insurance.

Retirement plan for all employees. No special insurance for the employees next to the retirement plan.

Multiple channels for recruiting new staff. No information available about staff training possibilities.


TOWS STRATEGIC ALTERNATIVE MATRIX

The management team has come with a TOWS matrix after looking at the outcome of the

benchmark analysis of the different departments; as well as keeping in mind the external

opportunities and threats that the Sonesta International Hotel Corporation has.

The following table indicates the strategies that could be applied to minimize these threats and

weaknesses by taking advantage of the strengths and opportunities available.


External opportunities (O)

Advanced Technology Becoming

Environmentally Sustainable (environmental certificates)

Increased corporate travel.

Consumers are more open to new experiences and ideas

Disposable Income Use of renewable

resources Grants from

government Positive relations

between countries Economic stability Seasonality Educated consumers Innovation Media coverage –

exposure Support of US labour

department for training.

E-HRM New Technology International

travel/food encouraged

External threats (T)

Terrorism Competition Economic Crisis Lack of Personal

Touch Negative PR Constant upgrading International and

internal laws- country- region specific

Laws regarding waste management

Policies during construction

Anti – smoking bans Increase in taxes. Seasonality


Internal strengths (S)

Have 3-4 star hotels. Cater well for business

and social events as many different conference rooms are offered.

Offer facilities such as mini-bars and room service

They offer cruises. State-of-the-art

buildings. Offer good wellness

Programs as they have golf resorts, spa resorts and all hotels offer sports and have fitness centers.

EPA Energy Star certified and Green Lodging certified

More hotels under construction

High occupancy, Rev Par and ADR

24-hour health club Guest loyalty Program Retirement plan Own channels for

recruiting new staff Casinos Children eat for free

under 12 Corporate Culture

(SO)“Maxi-Maxi” Strategy

Provide special Packages for the corporate travellers such as special packages for the use of their conference centres etc considering that they cater well for these types of travellers.

Offer specials on Cruises to the younger generation especially Colleges and Universities in order to attract the younger consumers.

The own channels for recruiting can be used to get more support of the labour department to keep training the staff.

(ST) “Maxi-Mini” Strategy

Build on and improve on the cultural experience and thus the guest’s experience.

Purchase new properties around the world especially in Africa and Europe where they don’t have property and thus gaining that competitive edge over the other hotel collections.

Designated smoking areas in casinos, cruises and restaurants.


Internal weaknesses (W)

Offer one guest loyalty program that doesn’t provide as much as the other hotel chains.

Are not as environmentally conscious as the other hotels.

Do not have branches in Africa and Europe.

Not all Sonesta Hotels offer free internet access

No information for staff about training possibilities

No staff insurance No assistance for

adoption or life insurance

Rather smaller corporate than competitors

Not much packages available

Don’t have the option of green food

No Personalized wine list

No Tea cellars

(WO)“Mini-Maxi” Strategy

By implementing more certifications than the ones they already have, the hotel would be more competitive.

Provide free Wifi Access to customers.

Innovating rooms and using automated room systems

The support of the US labour department can support the sonesta hotel group with their training program.

Implementing option of green food.

(WT)“Mini-Mini” Strategy

Offer a more rewardable guest loyalty program in order to increase guest retention.

Providing more packages and discounts.

Installation of special features for staff, for example staff insurance and life insurance.

Run on a tighter budget (be cost effective).


BUSINESS CASE SCAN

Using the TOWS Matrix above; a total of twelve strategies have been developed. This chapter

explains each of those strategies in brief.

Packages: Corporate, Cruise and others

When one compares Sonesta’s packages and discounts to those offered by the other Hotel

Chains; there is a serious lack of the same. Sonesta needs to focus on its target groups. One

can see that most of the hotels under the chain cater to a lot of corporate organizations and thus

they need to provide incentives to them. Sonesta is not yet as big a brand as the hotels that it

has been compared with. It needs to build its brand value and lure corporate customers by

providing incentives; this will not only lead to an increase in sales but will also help generate

repeat customers.

Purchase New Properties

Sonesta is the smallest chain out of all the chains. It has plans to expand further; but it should

also look at targeting Asian and African countries. A lot of its revenue is generated from the Nile

Cruises and the hotels in the Middle East; by purchasing and developing properties in these

countries they open themselves out to a more diverse market.

Smoking Zones in every Hotel

Smoking is not as socially acceptable as it was earlier due to people getting more health

conscious and serious about the laws regarding smoking. Sonesta needs to keep those in mind

and make provisions for the same. Some guests are very particular about smoking around them

and Sonesta needs to have designated areas in their hotels where people are allowed to

smoke.

Cultural Experience

Sonesta International Hotels Corporations emphasizes on the fact that they provide a unique

experience to the guests that visit their hotels. For example: the guests that visit Egypt will see

that a lot of their cuisine is Egyptian; the décor of the hotels are also influenced by the locations

that they are in. Sonesta needs to work on that difference by providing a cultural experience –

like having ties with Mueseums that the guests could visit; providing local entertainment. This

would make the experience more enjoyable and memorable for the guests.


Corporate Affiliations

Sonesta should affiliate themselves with more widely known brands. They need to develop ties

not only with travel agencies but with other organizations as well. For example: By affiliating

itself with a university, they could provide internships for students and in return get a skilled

workforce that they don’t really need to pay “an arm and a leg” for. This will also create brand

awareness for the hotel chain. Sonesta should also get itself marketed on the travel guides and

tourism department brochures of the countries that the hotels are located in. Even though

Sonesta’s headquarters are in the United States, it is not as widely known as one would

assume.

Environmental Certification

Even though two of Sonesta’s hotels have received environmental awards; the chain as a whole

does not show a lot of consideration towards the green movement. An environmental

certification will help put Sonesta on par with the other chains. The other hotels that Sonesta

has been benchmarked against dedicate a lot towards environmental sustainability and the

conservation or resources. A Green Globe Certificate is internationally recognized, it inculcates

ISO standards as well.

Free WiFi

Providing free Wifi Access in the guest rooms; and other public areas would be a good idea.

Marriott provides free internet access, but only to its gold and platinum members. The Hyatt

Hotels do not provide free access in the rooms but they do provide the service free of charge in

their restaurants. Some of the hotels under that Starwood Brand do offer free internet access in

all their rooms.

Innovation in Rooms: Room Automation Systems

Room Automation Systems like temperature control; electronic key cards and so forth not only

show that the hotel is tech-savy; but also reduce a lot of costs. There are a wide variety of

systems that can be used and customized to the hotels preference and budget.

Green Food

Sonesta offers a variety of cuisines; but it also needs to focus on the health aspect. A lot of

guests today prefer to eat healthy and vegan food. Sonesta can use fresh local products and


come up with a more health conscious menu. The new trend in the hospitality industry is the fact

that people prefer to have ‘easy-fast-on-the-go’ food. Sonesta can tie themselves with another

local company and then provide fresh food in the lobby. Busy travelers don’t always prefer to

order room service and so forth all the time. Sometimes family holidaymakers; while going on a

tour or going shopping would rather buy something healthy and fast while on the way out. They

would like to buy their own fresh products and be able to walk out and in of the hotel without

having to waste time.

Green Procedures

Adopting green procedures such as recycling of waste, using recycled paper for

correspondence, reducing energy and water consumption all lead to the decrease in the overall

expenses of a hotel. Green policies and procedures can also be used as a marketing tool for a

hotel. Getting an environmental certification improves brand image in a great way.

Guest Loyalty Program

There are a lot of CRM systems that can be applied in a hotel .A Guest Loyalty Program is very

beneficial; as everybody likes to feel appreciated and special. If repeat customers get bonuses

for the same; they would not find a reason to stop and this would create an advantage over the

competition.

Staff Benefits

One can notice that Sonesta doesn’t have a lot of the staff benefits that the other Hotels show.

Sonesta prides itself on its employees and the manner in which they are treated; but it needs to

provide for and help their employees on a personal basis. They could offer insurances,

employee benefits – like complimentary packages for good performance, support when it comes

to single parents, insurance coverage for the family and so forth. The team cannot really

comment too much on this as Sonesta doesn’t give out a lot of information regarding its

employees; whether it is training or benefits or satisfaction.


Step 6&7: The Business Case Strategies: Guest Loyalty Program 53

BUSINESS CASE STRATEGIES

The management team came up with a number of ideas to implement strategies for Sonesta

International Hotels Corporation. The following four strategies are the outcome of this. We have

included the concept and advantages of implementing the strategies as well as the costs that

would be applicable towards the same.

STRAGEGY 1: Go Green! (Environmental Certification)

LEED

Energy Star

Green Globe International

Eco Rooms and Eco Suites

Green Certificate

The aim of going green in most hotels is to maintain a cost effective and yet safe environment

for both staff involved and most importantly guests of the hotel. In establishing going green;

hotels need to be certified with a green certificate and should ideally be part of the green hotel

association. Therefore this is why one of our strategies is implementing going green in most of

the departments of the hotels, namely being; the Food and Beverage department looking at

green foods, Rooms and Divisions looking at green rooms and the hotel in general as a whole.

Some Sonesta’s Hotels are already certified with two or less certificates. Eco rooms and Eco

suites is one of the certificates that will be implemented within the Rooms and Divisions

Department and implementing the Green Certificate for the whole Hotel looking in depth for

ways to implement green food at all times.

Eco Rooms and Eco Suites

100% compliance with certificate will promote sustainability within the hotel therefore promoting

or including smoke free guestrooms. Approved status is based upon satisfactory completion of

an application and certified status requires an on-site audit of the claims made on the

application by one of the program advisors.



Arguments to implement the Eco Rooms and Eco Suites within Sonesta International

Hotels

Within the housekeeping department of the hotels that Green seal certified or equivalent

cleaning products, paper products (facial and bath tissue) are used within guestrooms

therefore this will promote a more green room.

Bathroom feature amenity dispensers or small practical amenity sizes with guests

encouraged to take the remainder of their bathroom amenities home. The hotel reduces

wastage on their grounds and work on a cycle.

The hotel can now work toward a cycle in implementing linen and towel re-use program.

The hotels can now provide separate and easily identified receptacles or bags in which

to deposit recyclables also this will promote guest involvement in the hotel and relations

with staff.

By incurring this certificate the hotel as a whole can also save towards energy by

implementing efficient lighting in every area of hotel with high efficiency plumbing (6

liters or less liters per flush per toilet and 5,6 liters per minute)

And it will promote a 100% smoke free Hotel in general.

Benefits

Half of all U.S adults are more likely to select a hotel that uses more environmentally

friendly products and processes.

Wider target market group

Reduces major costs after implementation process

Creates hotel status

Awarded recognition

Costs

Administration fee: $350

Cleaning Eco products for the whole Corporation: $ 101 961

Eco Amenities for all Sonesta’s Rooms (7783 rooms worldwide): $ 2, 411 841

Hardware/ equipment for rooms (7783 rooms worldwide): $ 1, 751 175

Total investment for Corporation: $ 4, 264 977 + administration fees ($350)

= $ 4, 265, 327

Green Globe Certification within the hotel



Green Globe Certification is the premier worldwide certification label for sustainable

management and operations. Green Globe is based in the United States and is very similar to

ISO 9001/14001 standards. A very easy to use web-base program system guarantees an

efficient process and keeps the business up-to-date at all times. We are looking to implement

this in all 31 hotels and in some of the cruise ships that the company has. In implementing this

certificate within this corporation it will enable and may increase revenue through performance

of management and staff therefore if they are aware that the whole company is educated then

this is able to attract more customers.

Arguments to implementing Green Globe Certification within the whole hotel

With implementing this certificate the hotel will immediately gain recognition from ‘green

consumers’

The corporation is not fully recognized, therefore with having this certificate and logo on

their websites it will most definitely enhance brand image and reputation to the existing

low one that the hotel has now.

It will enhance environmental stewardship within a destination for their customers.

It will increase sustainability within social practices at all levels of business management

therefore this will ensure that Sonesta being a smaller group pay more attention to detail

and increase revenue.

Benefits

Immediate access to the Green Globe Certification System will allow: Full access to the

online system to review all criteria for certification, Businesses can immediately begin

evaluation and certification by uploading documentation that addresses the criteria and

assigning tasks to staff throughout the organization.

Determine your own timeline for the certification process and establishing a

comprehensive budgeting program to plan investment in new solution to improve

sustainability performance.

A copy of the Green Globe certification criteria therefore the hotel will receive a copy of

the Standard detailing all criteria. This document can be used internally by businesses

for planning and training purposes.

The Green Globe benchmarking tool: Green Globe Index: This simple on line tool allow

the hotel to identify the level of sustainability currently being achieved. The short

questionnaire covers internationally accepted environmental and social responsibility



indicators. The Index report details the businesses’ successes and areas that need

improvement.

The Green Globe Environmental Trainings Program: A comprehensive program based

on tutorials which instruct management and staff on how they can achieve sustainability

for the business and in their communities. Teaches the importance of sustainability and

why it has become a global movement for better performance.

Operational costs will be lowered with complete certification.

Costs

Administration fees: $5000

To upgrade the Building to comply with the Green Globe it will be 2% of the Value for the land or

Building to comply with any Green Globe building standard.

Value of Buildings: $ 47, 300000 *2 %

=$ 946000

$ 946000 + $ 5000

=$ 951 000 for the whole investment of Green Globe.

Total Investment (Green Globe and Eco Rooms & Eco suites): $ 5, 215 977

Initial Investment: $ 5, 215 977

Net cash from income statement: $ 4, 100000

What we want from the investment 15%

P 0 Period

1-5years

CF -5, 215 977 4, 100 000

DF 1 3, 3522

PV – 5 215 977 13 744 020

Net Present Value: $ 8 528 043

Below is the balance score card of the implementation strategy of Eco Rooms and Eco Suites

and the Green Globe Certificate.

Module Assignment: Controlling and Evaluating- Part B Financial

Objective: To increase revenues & maintain costs at a low level

Measures: Income Statements, Balance


STRATEGY 2: Improving the Guest Loyalty Program

According to the TOWS matrix completed for Sales and Marketing it was decided that one of the

strategies was to implement an improved Guest Loyalty Program as this fell under one of their


Implement

Eco Rooms and Eco Suites & Green Globe Certification

Financial

Objective: To increase revenues & maintain costs at a low level

Measures: Income Statements, Balance

Internal Business Processes

Objective: Green Globe Certification - criteria to be followed as for Eco Rooms and Eco Suites

Measures: internal control and regular checks

Targets: The new procedures

need to be implemented

thoroughly within the first year –

Hotels need to be certified and

audited within this time period

Initiatives: Training therefore more open lines of communication

Learning and Growth

Objectives: Motivate employees to

conserve energy at home and be

environmentally conscious.

Measures: Feedback from guests and staff

Targets: employees know procedures and policies

Initiatives: Train employees and provide incentives

Customer

Objective: increase the number

of guests and appeal to a more

diverse market within the

financial year

Measures: Occupancy Rate

Targets: Increase in Average Occupancy

Initiatives: Green Globe

Certification, environmentally

friendly policies, more

exposure.


weaknesses as the other hotel chains that Sonesta was benchmarked against had a much

better guest loyalty program implemented in their hotel.

By improving the guest loyalty program it will provide many benefits for Sonesta such as:

Improving and providing more sales from the existing customer base.

Help spread word of mouth marketing

Provide a competitive edge/advantage

Improve Profitability

Improve personal touch by improving relationships with the customers/guests

By implementing this improved Guest Loyalty Program the points above will all come in to affect

and increase revenue and profit for Sonesta.

Sonesta is a much smaller hotel chain than the other hotel chains that it was benchmarked

against and therefore Sonesta have the advantage over the other hotel chains as Sonesta can

connect with customers and build stronger relationships as they can pay more attention to detail

and the finer preferences of their loyalty card members.

This new and improved Guest loyalty program will basically be an improvement on their already

existing Travel Pass Loyalty Program. More benefits can be included in this guest loyalty

program such as a point saving system in which guests have to accumulate points in which then

they will be able to reap the benefits of having a certain number of points. In this way guests will

feel more valued and will feel their loyalty is being recognized and hence will increase guest

retention and by doing this sales will increase.

Full description of the chosen strategy

While looking at the benchmark the management team chose to improve the Sonesta’s guest

loyalty program. Their current loyalty program is a good base, they are using a travel pass and

with every booking you can fill in your pass number. With 0-2 qualified stays you are a so called

‘member’. After 3-5 stays you are a ‘Preferred member’ and when you have visited the

Sonesta for more than 6 times you are an ‘Elite member’ A qualified stay is a hotel room

booking and does not include event or group bookings. In all these different groups of members

different advantages are offered.

Table 1: Benefits of the Travel Pass



Passion Perks Member Preferred Elite

Member email offers

Automatic enrollment in Travel Passion Sweepstakes

Free In-room Internet2

Preferred room preferences

Assistance from Travel Pass Guest Manager during stay

Express Check-in

Free room upgrade3

Late checkout4

Choice of welcome amenity

10% discount on dining or resort amenities

Early check-in5

Choice of 2 welcome amenities

15% total discount on dining or resort amenities

Discounted suite upgrade6

Turndown service

Free in-room movie

As can be seen in the table the first 6 benefits are the same for the 3 groups of members. From

there on only preferred and elite members get more benefits such as a discount of 10% of 15%

on resort of dining amenities, late checkout and free upgrade. Also they can choose one of two

welcome amenities. As an Elite member even more benefits as free in-room movies and

turndown service are offered. Also for just $50 dollar per night they can enjoy Sonesta’s suite

upgrade.

What the Sonesta Loyalty program does not offer is a point saving system; this is what we as a

management team would like to improve on the travel pass. With every visit guest gets Sonesta

points ( ) regarding the amount spent on the room, the points also can be earned by using the

Sonesta hotels facilities such as Spa and Health. For every 5 US dollars spent 1 Sonesta ( )

point will be rewarded. These points can be used for discounts on special actions for travel pass

members only. Also with these points travel pass holders can buy anemities at several front

desks such as big packages of guest supply brand items and even hand in a set amount of

points to get a discount in the sonesta-at-home webshop. Also the sonesta webshop can decide

to sell small items for points only. This can be communicated through emails and then travel



pass holders do not only view that one item but will visit the site and buy even more items from

the webshop.

Arguments for implementing the strategy

The biggest argument for implementing this new strategy of the guest loyalty program is that

frequent visitors who visit a lot more than 6 times in 1 month do not get more benefits then

visitors how visit the hotel 6 times in 5 years. They stay set on the same level of an Elite

member. But they deserve more because they visit the Sonesta hotels frequently and therefore

are loyal guests. The hotel’s management team benchmarked Sonesta against Marriott,

Starwood and Hyatt and they all have a guest loyalty program where points can be earned by

hotel visits. In comparison with these hotels not having a point saving system is a weakness for

Sonesta because frequent hotel guests may choose to go to Marriott because there the guest

can actually save up points for benefits and does not stay at the same level.

Benefits of the strategy for Sonesta international hotel corporation

For the Sonesta International Hotel Corporation the benefits are: improved personal touch by

improving relationships with the customers/guests because one now gets a broader over view of

the guest and their needs because the database will also show if the guest bought something

from the bar of had a spa and health treatment so the mini-bar can be stocked with the guest’s

favorite drink and one of the products bought in the spa and health facility on a previous visit

can be placed in the room as a welcome gift. Also the management team hopes to gain more

sales with offering special packages to travel pass holders.

Costs Involved and Net Present Value of Investment

The cost involved in implementing the improved guest loyalty program are very low if you take

into consideration that the travel passes are already there and the only thing Sonesta needs to

buy is a computer program and market the improved program. Also there are costs involved in

marketing packages for the travel pass holders but this can easily be done by direct mailing and

banners on their own websites which will not cost them anything. The cost of the development

of the banners being the only cost incurred. They also need to inform the travel pass holders of

the improvement which is going to be done via email or written letter in which the new terms,

rules and regulations are stated.

Table 2: cost for implanting the improved guest loyalty program



Computer program $6000In order to market the improved guest loyalty program on their own site and emails banners need to be developed.

$1500

Letter to travel pass holders (20.000 letters) $2250 of corporation stationary + stamps. ($88.73 dollar per 1000 if you order over 5000.)

Total investments cost $9750

The expected incremental cash flows is 0.85% increase of total revenue of 2008. Which is 80500000/100 * 100.85 = $81184250. $81184250 - $80500000 = $684250 which are the expected annual incremental cash flows

Table 3: incremental cash flows CF 0 CF 1 CF 2 CF 3 CF 4 CF 5

Cash flows -9750 684250 684250 684250 684250 684250

The discount factor is going to be 12% and according to Schmidgalls, hospitality industry managerial accounting tables the cash flow needs to be multiplied with 6.3528 as a discount factor. This gives us the following calculation; $684250 * 6.3528 = $434693.40 - $9750 = $43371534

$43371534 is the NPV it is higher than 0 so the project is financially viable.




Improve Guest Loyalty Program

Financial:

Objective- To increase sales and gain higher profit and increase net income for the whole hotel chain.

Measures- Income Statement, Balance Sheet and Cash Flow Statement

Targets- To improve sales and increase revenues

Initiatives- Increase discounts awarded and in so doing you will retain more guests and therefore in the long run gain more revenue which will improve the hotel chain financially.

Internal business processes

Objective- To implement a new guest loyalty program in which more discounts and rewards are offered to guests in order to improve brand image and guest retention.

Measures- Income Statement, Balance Sheet and Cash Flow Statement (financial statements)

Targets- Improving the guest loyalty program by implementing more discounts and rewards to the members of the program.

Initiatives- To implement a process whereby members of the guest loyalty program receive greater discounts and rewards and as well as personal preferences.

Customer:

Objective- To improve customer retention and brand awareness /loyatly.

Measures- Customer Satisfaction and Cutomer Retention by doing surveys and observations as well as looking at the Occupancy Percetnage.

Targets- Attracting and retaining more customers and guests.

Initiatives- Broadening the target market and satisfying different types of guests.

Learning and growth

Objective- Improve and find new attractions for the guest loyalty program and widen the target market thereby improving the brand image and guest relations.

Measures- Occupancy Percentage as well as customer retention and satisfaction

Targets- To increase customer retention and loyalty and to attract more customers to the brand

Initiatives- Increase occupancy percentage by at least 15% by implementing the new guest loyalty program.

STRATGEY 3: Implementing E-HRM in the Organization

The Sonesta Hotel group, does not yet use E-HRM, meanwhile they have per hotel their own

HRM Department. For getting a better overview and central HRM department this could give

better overview and lead the different HRM departments.

Via E-HRM the central HRM department can keep track of all the staff working and arranging

things for them such as training, meanwhile the hotels own HRM department can focus more on

staff contact and scheduling because the Main HRM Department takes care of the subject that

can be done for all the sonesta staff.

Sonesta thinks staff and guest contact are very important and focuses a lot on that part however

they don’t inform staff on their website about training possibilities and others. Via E-HRM this

can be improved because this type of HRM can give an overview of the possibilities of the

different hotels.

So by using E-HRM the sonesta hotel group will get a better overview of all its different HRM

departments and all the departments will have more time to work on their staff satisfaction and

training.


SmartHR

Cost: R15 per employee per month. The investment consists of software, implementation and training and a recurring annual fee.

Sustainability: The database design permits virtually unlimited scalability without performance loss. The application itself provides flexibility allowing you to add and remove modules as your needs change and customize the solution via forms and fields; work-flow; automation and reporting.

Employee Performance: The system itself does not solely improve employee performance; many factors contribute to such in business. It does however matches performance gaps to development actions to pin-point action steps needed to improve an individual’s performance. The system also has a feature of Initiating corrective action. It allows management to keep and have easy access to performance, goal and disciplinary information which then allows informed decision making on corrective action.

Recruitment: The system allows management to easily compare internal and external applicant, cv and interview information against job requirements to make better candidate role matches

Employee Training: All users are trained on-site by accredited SmartHR trainers. Every trained user gains immediate access to premium technical support for any assistance they require. Assistance is provided on-site and via phone, email and remote web assistance. Client receive a high level of standard support and the option of custom support contracts. They are commited to premium training and support services to ensure your system is operational and secure and your staff are deriving maximum benefit from the solution.

Implementation of strategy

Based on the strategy provided by the Software’s site and one based and prior knowledge of

general research strategies it would be most effective to implement the SmartHR E-HRM project

in the following way:

Pre-sales needs evaluation – Taking the time to fully understand your business needs

Project scoping and planning – ensuring the business knows what to expect when


Business process mapping – Provision of virtual documents on how your new HR

processes will look

Data migration – Consolidation and importation of the businesses existing data into

SmartHR from payroll, spreadsheets etc

Systems integration – Automation of integrations to the businesses payroll, t&a,

financials

User training and documentation – Ensuring that the users enjoy maximum value from

the system

Customisation and support services – Support the users and extending the value of their

solution

The system can be implemented in a period of between 2 weeks and 6 months depending on

the size of the organization and the level of customization needed. It gives accurate estimates at

the beginning and more than 95% of projects have been completed within time and budget.

Benefits:

The system can be tailored to suite the needs of the company.

It can also be implemented in a short frame of time.

The software provides an implementation strategy itself

The users can be trained on-site.

The recruitment feature that can automatically select the right applicant according to

his or her resume and the description of the vacant job

NPV Calculation for implementing SmartHR

SmartHR’s charges are tailored therefore the figures are based on projections based on

Research about Sonesta.

SmarHR’s initial software cost is R950

They charge R15 per employee per month and have an employee base of 3500 people

therefore 15 X 3500 X 12 = R 630 000

The initial investment for a year would then consist of 630 000 + R 950 which is equal to R 630

950

The discount rate is 12 %


Therefore the Calculation is:

R630950(12%+1) +

R630950(12%+1 )❑2 +

R630950

(12%+1)❑3 + R630950

(12%+1)❑4 + R630950

(12%+1)❑5

= R 2 274433.54 (NPV). This is a good investment as the returns are higher than the rate.


Financial perspective

Objective: reduce labour cost

Measure: income statement

Target: decrease administrative costs

Initiatives: Implementing E-HRM software

Learning & Growth

Objective: Get a better overview of all the hrm departments

Measure: staff satisfaction and lower staff turnover

Target: Staff should know about procedures

Initiatives: technological updates

Customer perspective

Objective: increasing staff training

Measure: staff knowledge/ satisfaction

Target: No mistakes or lag time when it comes to service

Initiatives: Develop a training program

E-HRM

Internal business process

Objective: more training and more staff contact per HM dept.

Measures: Staff surveys

Target: better staff service

Initiatives: Improve communication lines

STRATEGY 4: Discount Packages

This strategy is the outcome of an internal weakness and an external treat. The hotel does not

offer a lot of packages at the moment compared to the competitors. An external threat is the

constant upgrading of trends and new innovations. When the hotel offers packages which are

up to date and changes them according to new trends and according to the wants of the

customers the hotel could compete more with the competitors.

The hotel could include the facilities in the packages. They could offer cheaper packages during

the economic crisis. For example the meals are already included or that the room services are

free. An example of a package can be that when a guests makes use of the health club that

they can have a special free treatment there such as a massage. It would attract guests and

when the hotel would implement packages the customers will automatically make more use of

the facilities because it is included. Therefore the hotel could make more money when

implementing more packages. A guest can also change its plan to go to one of the competitors

when they see they can make a better deal at Sonesta.

Corporate guests are a good target market to offer packages to. Good offers could be made

with meals, guest rooms, conference rooms and the hotel facilities all included. An example of a

package is that when there is a business group who hire a conference room and they also stay

in the hotel overnight they get a free dinner excluding drinks. The change is that they normally

will only have dinner in the hotel but when they have a special offer they could also decide to

stay overnight in the hotel. It is also very important to promote the packages available and to

evaluate the outcome of the packages.

It can be concluded that when the hotel offers more packages due to trends it would increase

revenue because the guests make more use of facilities which they normally would not do.

Furthermore it would also be better to compete because the main competitors of the Sonesta

hotels offer more packages than the hotel group does.


Sonesta can base its packages on trends and innovation, keeping up with the trends will make

their packages more attractive to the guests. If Sonesta had to offer the same packages at all its

hotels more guests would visit them because they wouldn’t necessarily have to travel far to get

a great deal that Sonesta is offering. Advertising these packages extensively will give Sonesta

more exposure and brand awareness. Sonesta can also offer hotel based packages for events,

which include the newest trends in food, décor and entertainment. The new packages can bring

in more revenue for Sonesta as they will have more guests visiting their hotels. The packages

should be updated frequently so that they are always new and on par with trends. The

implementation of new packages can also create exposure from struggling departments and

help them increase their profits. The packages must also be evaluated so that the managers

can see if they are working effectively or not, and if a different package will have to come in to

place.

Some examples of possible packages include:

Business Class Package: free internet access, late check-out, ‘royal breakfast’ and

luxurious accommodation.

Lazy Sunday Package: unlimited access to spa and health facilities, deluxe

accommodation and three course dinner.

Healthy Package: free use of sports facilities, standard room, healthy breakfast and

dinner.

Event Package: access to event, deluxe room, late checkout

Arguments for implementing the strategy:

Sonesta has a good position when compared to its three main competitors, in terms of

occupancy rate, Rev Par and ADR. To increase the figures even more, offering trendy

packages is the way to reach that.

Sonesta’s competitors offer hotel packages as well and to set Sonesta apart from its

competitors and exceed guest expectations it will have to offer new, trendy and

innovative packages. If all the Sonesta hotels offer the same package they will have a

standard of brand similarity that guests can rely on, no matter where they are in the

world. The distinctive packages also help to focus on the different target groups, catering

to their diverse needs and wants. More guests will be attracted to Sonesta because the

packages are up to date with the latest trends and provide for the guests needs. This in

turn will be bringing in more revenue and Sonesta is able to upgrade the departments

and bring more attention to them.


Benefits:

According to the arguments stated above, one can concluded that the benefits of this strategy

are:

Competitive advantage

Standardization of brand

Better focus on target groups

Increase revenue

Attract more guests

Costs:

The initial costs that would be incurred to implement this strategy would mainly be the

advertising costs. Instead of using offline media like newspapers and journals; a more financially

viable concept would be to use the internet as the medium. The organization would be able to

reach a larger target through this as well. Updating and revamping their website, email

marketing, displaying advertising banners would constitute most of the marketing for this

strategy.

Initial Advertising and promotion expenses: USD 5000

Time period: 5 years

(Expect rooms revenues to increase by 5% due to this strategy.)

Stable Cash Flow every year: USD 2050

Discount Rate: 12%

NPV= C0 + C1 / (1 + r)

Where: C0 = Initial Investment: -5000; C1 = Cash Flow for year 1: 2050; r = discount rate: 12%

Time period 12% Initial cost (outflow) now -5,000 1 -5000Annual cash flow 5 years 2,050 3.6048 7389.84


NPV 2389.84

Since the Cash Flow is stable over the five year period; by looking the Table of Present Values

for an Annuity (Schmidgall); the NPV is a positive and is greater than zero. This shows that the

strategy is a sound one.

Conclusion


Financial perspective:

Objective: Increasing revenue by offering packages

Target: Increasing the amount of sales by 5%

Measure: Increase in sales

Initiative: Providing more packages

Providing more packages

Customer perspective:

Objective: Focus on trends and major market demographics.

Target: Attract guests

Measure: Evaluating

Initiative: New trend packages

Learning & Growth:

Objective: Research in the market

Target: Meet the guests wants

Measure: Guest satisfaction surveys

Initiative: Provide more package according to the trends Internal business

process:

Objective: Updating of trends

Target: Attracting more guests

Measure: Occupancy rate

Initiative: Providing good deals and special packages

CONCLUSION

The four business improvement plans that have been developed for Sonesta

International Hotels Corporation have solid arguments as to their success. Apart from the

environmental and social benefits; research shows that Green Certification and Green

procedures help the organization to reduce costs when it comes to energy, water and waste in

quite a big way.

Green Globe certification provides an immediate recognition for green consumers. A

number of larger companies chose to stay with the hotel due to the Green Globe Status. (Paul

Richardson, VP. Accord Hospitality. New Zealand & Fiji).

Consumer interest in sustainability issues is gathering momentum and nearly half of all

travelers polled by Travel Weekly said they would be prepared to pay up to 10% more to stay in

a green-certified hotel.

The Guest Loyalty Program will ensure repeat customers and thus increase sales and

create a good reputation in the market. Using E-HRM tools in the organization is another

strategy that we have come up with. We would like to implement E-HRM software within the

administrative department. Since Sonesta is an international corporation; it should use these

tools to stay one step ahead, in not on par with the others in the industry. Apart from the less

stress on the HR Managers; this also increases employee motivation as employees can easily

look at their performance and compare statistics as well. It is safe to assume that a hotel with

200 rooms would attract a lot of candidates for jobs; this software would help to sift through the

candidates, which saves a lot of time.

At the moment, Sonesta has a few discounts and packages available but they are very

minimal and none cater towards their main market – corporates. The team argues that by

offering corporate packages which include managers to have their family stay as well; would be

a big bonus. A lot of large organizations have their conferences and meetings in different


locations; by offering packages that would make it cheaper for the managers to bring their

families along would generate a lot more sales.

Overall, Sonesta operates quite well at the moment; but with its expansion plans and the

fact that it is a serious competitor in the industry; these strategies will help it to achieve its goals,

which concern employee, shareholder and guest satisfaction.

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Appendix


http://www.linkedin.com/

http://www.smarthr.co.za/

business improvement plan - sonesta international hotels corporation

Documents

management team

world sonesta

hotel chain

hyatt hotel group

work module assignment

b page

introductionthis assignment

y y y y y general managers