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Case Study of Taj Hotel

Group
By:
Akhilesh Singh Rawat
Harish Kumar
Pushpendra Kumar Singh
Shubha N. Bhambhani
PG-PPM , MDI GRGAON

Issue at hand
Krishna Kumar is facing a dilemma that Mr.

Bhowmick who is COO of Luxury Hotel Division


has plan to appoint a General Manager who has
been handpicked by him in contrast to CDC
recommendation.
Experience with the processes that no one took

seriously
CDC has spent considerable time and discussion
in selecting the candidate
Bhowmick may help the person whom he chooses
but not the person selected by the system
Good Judgment vs number based performance

History and Origins

Taj Mahal Bombay ( the Taj) was built by Jamshetji Tata

in 1903
Indian Hotels Compnay(IHC) was sole share holder
Under Ajit Kerkar who led during 1970 to 1997 , saw
rapid growth & at one point Taj group owned more then
80 properties within Indian and overseas
Kerkar was charismatic leader running organization on
personal relationship
Success for employees was determined by the proximity
to Kerkar - Resentment among executive who were not
in Kerkars coterie
Salaries were 15-20% below the market
Lack of Corporate Governance - Questions were raised
for not meeting ethical standards by Taj Group and

New Initiatives in Taj


Vision of Taj a hotel with service philosophy of

Indian World and the technological underpinning of


the western word
Voluntarily Early retirement package was given to
256 executives and 1697 staff members out of 15000
Salaries were raised to be inline with market
Some of the properties were sold and shut down
Management Structure based on Product Area was
formed and resulted in to three divisions viz. Luxury
Hotel , Business Hotel , other division ( Leisure hotel ,
International Hotel and Air catering)

New Initiatives in Taj -

Contd

Taj People Philosophy Performance Management

Process linked to long term company goals


Through Balanced Scorecard
Performance Appraisal System ( 75% on Objective
Results , 25% on Judgmental Review) for fair
evaluation
Key Result Area ( KRA) comprising Goals and
Objectives were laid out at the beginning of each
year and progress was tracked and monitored
Potential Development Centre (PDC) established
to evaluate the fast track professionals
Employee Satisfaction tracking System

New Initiatives in Taj -

Contd

Taj Focused training interventions


Focus on creating system and standard for

operations and Service Quality


Balance of Labor management relations
360 degree feedback system
Carrier Development Committee formed
to value the contributions of performers ,
discuss high level openings and how to
groom senior mangers for those jobs

Challenges
Transparency at Great Cost Comparison of Fast

Tracked Professional and Non Fast Tracked Professional


Dilemma for achieving the international norms for staff
to guest ratio
Growth of a non IT conversant workforce
Competition from Global Luxury Hotel Chains World
class Service and standards of excellence
Need to have a Balance among the Ability to change and
value of relationship & local Knowledge Labour
Management Relationship
Hotels with service philosophy of Indian World with
technological underpinnings of the western world Glass
ceilings for Indian Managers

Developing Managers -

Past

Tata Administrative Service


Tajs own Management Training Program
Rising through by excelling as staff workers

through sheer hard work


Under tutelage of Seniors(Kerkar) - Managers
were mentored/developed and assigned to
Properties
Service Quality compromised
Lack of Structured systems - 3600 feedback
Employee Satisfaction Tracking System

Developing Managers
Current & Future

Career Development Committee


System based Approach not a substitute for mentoring

Performance Management Process linked to long term

company goals Through Balanced Scorecard


Performance Appraisal System ( 75% on Objective
Results , 25% on Judgmental Review)
for fair
evaluation
Key Result Area ( KRA) comprising Goals and
Objectives were laid out at the beginning of each year
and progress was tracked and monitored
Potential Development Centre (PDC) established to
evaluate the fast track professionals

The way forward


Krishna Kumar need not to reverse the decision of

CDC on account of following : Taj

Group is concerned with promoting within


company and personally making efforts to educate
and better their current staff has positive outlook.
The promotion in Taj Group are being governed by
how well the employee is completing that KRA
instead of personal relationship between employee
and management
Employees are aware of the CDC and they know
that the performance is continuously being
monitored by central management.

Thanks

Balanced Scorecard
The balanced scorecard

is astrategic planning
and management system
that is used extensively
in business and industry,
government,
and
nonprofit
organizations
worldwide
to
align
business activities to the
vision and strategy of
the
organization,
improve
internal
and
external
communications,
and
monitor
organization
performance
against
strategic goals.

360 degree feedback system


360-degree

feedback,also
known
asmulti-rater
feedback,multi
source
feedback,ormulti
source
assessment,is feedback that
comes from members of an
employee's
immediate
work
circle. Most often, 360-degree
feedback will include direct
feedback from an employee's
subordinates,
peers
(colleagues), and supervisor(s),
as well as a self-evaluation. It
can also include, in some cases,
feedback from external sources,
such as customers and suppliers
or other interested stakeholders.