WEST INDIES YACHT CLUB

RESORT: WHEN CULTURE COLLIDE

Gaetano D’Imprima ID- #35129755-8

Agenda

A.  Introduction B. Questions

1. Framework and Problems 2. Managerial behaviour 3. Recommendations

C. Limitations

What are we talking about?

BVI

36 islands 16 inhabited

Tourism

1950-70 Traveling elite

1970à Bareboat charters (much

more affordable)

Facilities:

Smaller mid-scale to upscale

hotels

Airport problem

RESORTS Biras Creek Drakes Anchorage Little Dix Bay

Resort Peter Island Yacht

Club

Rooms 34 12 98 50

Facilities

1 restaurant, 3 tennis court, private beach with bar, small marina, several miles of nature trails.

1 restaurant Anchorage for charter boats Hiking trial 3 sandy beaches

1 restaurant Small boats, water-skiing Snorkelling Diving

1 restaurant Marina Beach

Price (per night) 395%-695$ 400$-600$ 480$-1000$ 395$-525$

Expatriates 3 year contract Oversaw operations Rotate every 2-3 year within the group

Managed by expatriates

Value for customers Limited activities Water sports Limited activities

Upscale hotels in the BVI

West Indies Yacht Club Resort "   1964 Kimball family fall in love with the place.

"   place with 5 cottage and a pubà "   Dubois ecology and weirdness

"   1973 after several visits Kimball "   want to buy a small property "   buy the whole property "   Differentiate the resort: Bungalow and sailboats

"   1987 Sandy Point Resort management contract "   Enlarge the resort and its facilities

"   1990 Fully operational water sports oriented

"   OCCUPANCY PROBLEMS (-40à60% off peak)

"   REWARDS by magazines (CONDE NAST)

KSF "   Eco-conscious and comfortable place for travellers

"   Try to maintain the natural shape of the resort

"   Differentiation " Watersports, sailining, fishingboats

"   Successful marketing strategies "   TARGET FAMILIES

Key Issues WEST INDIES YACHT CLUB RESORT

Rooms 96

Facilities Marina with all water sport facilities 2 restaurants Natural trials Fuel dock beach

Price (per night) 390$-595$

Value for clients Water Sports

"   Competition "   Other resort start having watersport

" Labor Cost (regulations) "   Talk later

WIYCR

What are the problems that Johnson and the resort currently face?

Which problems are potentially related to cultural differences?

What local government regulation and policies limit WIYCR management options?

What theories of motivation might explain why BVI employees seem to be different than US employees?

Questions I part Framework and Problems

Problems that Johnson and the resort are currently facing

Expatriate managers’ turnover

Customer satisfaction

Misunderstanding

between local and

expatriates staff.

•  6 expatriates managers had been hired and quit in just 2 year.

•  A deeper analysis of the case shows that the former managers used to manage areas in which they have to stay strictly in contact with local employees.

•  the number of guests complaining about the low level of service, provided by almost all the staff operating at the resort, had increased drastically (from 10 per week to 30 per week

two categories of employees use to work in a different way and where not able to collaborate. This problem makes the resort a very hard place where to work for both sides.

• Power distance is the level of acceptance by a society of the unequal distribution of power in institutions àLOW/LOW

• Uncertainty Avoidance is the extent to which people in a society feel threatened by ambiguous situationà HIGH/LOW

• Masculinity refers to the degree of traditionally masculine value (assertiveness, materialism and lack of concern for the others) that prevail in a society. The fundamental issue here is what motivates people, wanting to be the best (masculine) or liking what you do (feminine). MASC/MASC

•  Individualism is linked to the tendency of people to look after themselves and their immediate families only and to neglect the needs of society. COLLEC/INDIV

• Informal relationship • accessible superiors • “coaching leaders”

Power distance (LOW)

• they don’t want to take risks • non-decision making” style • role of regulation

Uncertainty Avoidance (HIGH)

• Different elements than money drive their motivation

Masculinity

• Extended relationships • Group first

Collectivism

Cultural Differences

• Similar to the Carribean but in the case

Power distance (LOW)

• They want to take risks • Strong decision taking style • Achievements first

Uncertainty Avoidance (LOW)

• Money • Promotions • Career

Masculinity

• Family • Individual first • Achievement

Individualism

NOTE

BVI Labor law

Limited number of work permits + Promote local if possible • Linked to the high level of

illiteracy it leads to the possibility of not-well educated staff

No lay-off during slow seasons • Higher Labor cost (not in

term of wages but retention)

Restricting firing conditions • Compensation system

problems: • Rewards

Firings Uncertainty avoidance

VACTIONS Less time for expatriates Paid by offshore companies

people are not truly rewarded according to their performance and they can’t be fired if they don’t work. Local employees, who are uncertainty avoidance, feel save and they are not motivated by money or promotion by themselves. They know that they will get more money within time, putting the same effort or eventually not working at all

MORE INEFFECTIVE HR

Culture and problems

Expatriate turnover

Management style doesn’t fit with local.

Power distance + Indivividualism

Customer satisfaction

Employees management and compensation system

Motivation

Conflicts between local and expatriate staff

Cultural collision

Individualism vs Collettivism

. They came from the US and managed locals in the same way they would have treated Americans. The way they give orders, the feedback they expect to receive and the way they motivate local employees was a result of their personal background, especially linked with the American individualistic culture. This management style doesn’t suit the local.

The current compensation system also play an important role because it’s not good to motivate local staff

the two different cultures’ collision

Motivation theory

Self-actualization

Esteem

Belongingness

Safety

Physiological

" Humanistic Theories of Motivations: People have strong cognitive reasons to perform various actions

This is illustrated in Abraham Maslow's hierarchy of needs, which presents different motivations at different levels.

Maslow's hierarchy of needs is the representation of westerner society so in the case it could be seen as the way the Americans are motivated: they will reach their climax when they will be able to fulfil their self-actualization needs, thanks to promotions, more salary

Caribbean Pyramid of Needs

Belongingness

Self-actualization

Esteem

Safety

Physiological

Caribbean people have the same needs, but the hierarchy seems to be completely different. At the top of their pyramid, belongingness needs are the most important.

This has a very strong impact on the motivation, making the resort compensation system as ineffective. It has been created for people who want to satisfy self-actualization needs, so it is not the right way to motivate people who want to fulfil other kind of need (friends, family, group identity).

The regulations, with the “difficult to fire” mode, also help the system to be even more ineffective.

Several example of managerial behaviour are provided in the case. Which behaviour seems to be inappropriate regardless of cultural context? Which seem to be ineffective due to the resort cultural context?

Why is Lucas having such a difficult time with his staff?

BVI employees, especially those in Water Sport Department, don’t seem to be motivated by tips. Why do you think this is so? What alternative arrangements might be made?

Does the fact that Kimball, Johnson and Fitch work from the United States have any potential impact on local employees?

Things are not all bad at WIYCR. Who are the expatriate managers who seem to be effective and why are they effective?

Questions

Part II Managerial Behaviour

WIYCR Managerial Structure

Chicago office President

General manager

Operations Level, Accounting &

Finance Property manager

Rooms Division Manager

Front desk Housekeeping

Food & Beverage Director

2 Restaurants and Commissary

Waterfront director

Watersports Director

Marina director Engineering Department

Marketing and Special promotions

Director

Chicago office

US

Joe Kimball

US

Jim Johnson

USàUS/BVI

Operations Level, Accounting &

Finance

Kent Mawhinney

USAàBVI

Kristin Singiser

USAàBVI

Front desk Housekeeping

Steve Lucas

USAàBVI

2 Restaurants and Commissary

VACANT

Enrik Harrigan

DominicanàBVI

Nick Smith

USAàBVI Engineering Department

Tom Fitch

US

Johnson’s main intervention area

Chicago office

US

Joe Kimball

US

Jim Johnson

USàUS/BVI

Operations Level, Accounting &

Finance

Kent Mawhinney

USAàBVI

Kristin Singiser

USAàBVI

Front desk Housekeeping

Steve Lucas

USAàBVI

2 Restaurants and Commissary

VACANT

Enrik Harrigan

DominicanàBVI

Nick Smith

USAàBVI Engineering Department

Tom Fitch

US

“Real” main intervention area

NO Communication

After reading the case

Johnson • Lives in the US • Speaks only with top managers • Stays in his office • Should be the bridge with Chicago

Lucas • Individualistic American • Not a coaching leader • Doesn’t build relationships • Complains too much

Harrigan • Non-decision maker • His subordinates want day by day goal • He has no supervision

Fitch • Rarely on place • Cannot understand resorts’ truly capabilities

and potential.

Kimball • Old • President • Can perform his activity from Chicago

Chicago Office • More communication and integration with the

key people in the resort

Inappropriate and Ineffective managers (I)

Inappropriate and Ineffective managers (II)

Johnson, Lucas, Fitch

Most inapproriate behaviour

For local they are outsiders

Common attributes:

American people

Worked in hospitality resorts in the US

Specialists (academic training)

Parochial Attitude

Narrowly restricted in scope or outlook

Effective Managers

• “Get-his-hands-dirty” Man • every day on the field • Truly interested in all the

resort problems • always accessible

Kent Mawhinney, Property Manager

• Relationship builder • Never take things for

credit • “Bash them over the head

with it” philosophy • Her really problems are

with the HQ

Kristin Singiser, Rooms Division Manager

Cultural Approach

•  Water Sport employees don’t seem to be motivated by tips, they want something else. By they way it seems that they would like to have some more money somehow (like when Down show them the tips he gained).

•  But individuals do not need just money and rewards, they also need respect and interaction.

•  They want to be friends, not only subordinates. For example they treat with interest the guests who had offered them drinks.

•  The Watersport’s director can start saying thank you everyday if a good job is done and go drink a beer with his employees after work.

•  Teamwork is also important. Employees should work in teams formed of local and expatriate staff. Instead of tips, team who perform well every day, at the end of the month will have paid days off, or will gain special holidays during their forced lay-off period.

Not challenging people and they don’t reward

“individual” initiatives Don’t believe in their

capabilities

They want respect and interaction

They want to build a friendship relationship first

No TIPS motivated

Unmotivated water-sport’s staff

Part III Recommandations

If you were Down, what short term and long-term recommendation would you make to Johnson?

What measures would you recommend that Johnson take in order to reduce the level of expatriate turnover?

What measures would you recommend that Johnson take in order to decrease the occurrence of guest complaints related to unmotivated local employees?

What measures would you take to reduce the growing gap between expatriates and local employees?

Questions

Customer satisfaction

Short term

Apologies

Discounts, special prices, special offers or prize

Long Term

Present to everyday activity

GM ‘s everyday meetings, with Room Division manager

Executives everyday meetings with staff

“Tutor” for each task group with the assignment of “call them on their duty

Talk more with the staff

Everyday explaining plan (even physically)

Continuously control plans

implementation

Check if everything is ok

Ask instantaneous feedbacks.

Thank the staff if the job is well done

“Tutor” with the assignment of “call

the staff on their duty.

Merge the Marina direction and the Waterfront direction • Control Harrigan

Small teams (2/3 people) of both

locals and expatriates

Organize parties

STAFF: Short-term decisions

Executives Staff

•  Share tips •  Paid days off at the

end of the month for the team

•  “Special” vacations during their forced lay-off period

•  Other daily prizes, such as free drinks

•  INTERACTION

Especially Lucas and the watersport director

BOTH •  Johnsonà

executive •  Executiveà

Staff

for a total of 22 employees). Smith has to control and rules Harringan operation

Johnson

Move to the resort and live there • Bridge with US • Cross-cultural management course

Mawhinney CLO (Chief Learning Officer)

Staff Training

Cross-cultural management course

Local: Inner “Hospitality School” Train for intermediate management positions

Expatriate:

High experience in the Caribbean or poor experience in the US hospitality market Greater incentives to stay

Chief Learning Office of the Resort: responsible for formulating learning strategy and education initiatives for the local employees. His tasks can include integrating and managing training programs throughout the organization.

DO LIKE THE PROPERTY MANAGER JOB

Limitations

Little information about

BVI’s culture

Motivation

system

Values

Dave Pickering example

Worked mainly with expatriates

Any relationship built with locals

TIPS: Down vs

Dave

•  When Down did it they thought he was joking and then they were willing to know how was it possible.

•  When Dave did it they didn’t care and maybe considered it as “showing off”.

•  Down was considered part of the group, a friend not only a colleague. •  Dave had any relationship with them.

•  The lack of information about how to gain respect in a culture as a leader could lead to different result from a similar behaviour provided by someone who is accepted and someone who is not.

THANK YOU