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Project Report on
Management and leadership across cultures
OfRAMADA HOTELS
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Table of Contents
Page No.
Executive Summary 3
History .... 3
Introduction..4
Objectives.5
Management Theories.5
Organizational Culture ..8
Leadership 9
Motivation 12
Conclusion & Recommendations..14
Bibliography..15
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EXECUTIVE SUMMARY
Today the companies all over the world are expanding all over the world, resulting in
globalization. This globalization has led to competitive markets which in turn is good for
the consumers because they have a wide variety of options to choose from and they gettheir desired product at the best market price. But due to globalization, the companies all
over have to recruit people from different parts of the world. As a result of this there is a
cultural diversity in the workforce of any multi national company because all the
employees have a different national culture which is deeply rooted inside them. This
cultural diversity could be a bane or a boon for any organization. If the cultural diversity
is not handled properly it could prove to be disastrous for the company and could damage
the brand image of that company for ever.
Handling the cultural diversity is not a simple task. To handle it, firstly a company needs
to identify proper leaders, who can positively motivate the employees and effectively
represent the top management to the employees and vice versa. The leader shouldmotivate the employees to inculcate the organizational culture within them. He should be
able to integrate the national culture of the employees with the organizational culture, and
hence create a synergy.
HISTORY OF THE RAMADA GROUP
The Ramada hotel is a very famous, luxurious and worldwide chain of hotels owned by
Wyndham Worldwide which is head quartered in New Jersey, United States of America.
Ramada hotel group was found in 1954 by Marion Isbell along with a couple of investors
in the USA. They opened their first hotel with a facility of sixty luxurious rooms in
Arizona. They soon set up their head quarters in Arizona, USA. Marion Isbell led the
Ramada group till 1972 after which his son, William Isbell took over the leadership from
his father. The Isbells displayed very effective leadership qualities and were always able
to keep all their employees highly motivated, which in turn showed by the very polite
manner in which all the employees always treated all their customers. (Grilliot &
Schubert, 1992)
In the 1980, the Ramada group formed a new division called as Adamar. This divisionsmain objective was to take care of the casino operations of the Ramada group. It was
around this time that they began to focus and grow in the casino and luxurious hotels
market. When Ramada hotels began, they were a chain of road side hotels which earned
their major revenue from the lodging facilities. But the recession of the 1980s hampered
all the major markets including the lodging and boarding markets. This drastically
reduced the business revenues for Ramada hotels which at that time mainly relied on their
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revenue from their lodging facilities. Thus, because of this recession the Ramada group
began to look out for new business opportunities and finally decided to enter in to the
business of casinos and luxury hotels. However in an effort to revitalize the slowing
business the top management of the Ramada group decided to separate the hotels and
restaurants business from the casinos business in 1989. In the 1990s the Ramada hotels
was sold to a New York based company by the name Cendant Corporation which is now
know by the name Wyndham Worldwide. (Grilliot & Schubert, 1992)
INTRODUCTION TO THE RAMADA HOTELS
Today the Ramada group has made its presence globally and caters to the culturally
diverse needs and demands of a population which spans through out the world. Apart
from its culturally diverse costumers, Ramada hotels also employees an equally culturally
diverse work force. Thus it is very important for this hotel group to have an efficientmanagement which can effectively address the various culturally diverse needs of both
the employees and the costumers. (Grilliot & Schubert, 1992)
Today in this culturally varied atmosphere it is very important for any organization to
have a very efficient management team which can successfully drive the organization on
a successful path amongst the numerous cultural barriers. Some of the top management
members of the Ramada group are as follows:
Keith J. Pierce President of Ramada Worldwide Inc.
Mark F. Young CHA - Brand Senior Vice President, Ramada Worldwide Inc.
The following are the board of directors of the Wyndham Worldwide group:
Stephen P. Holmes Chairman and Chief Executive Officer
Myra J. Biblowit Director
James E. Buckman Director
George Herrera Director
The Right Honourable Brian Mulroney Director
Pauline D.E. Richards Director
Michael H. Wargotz Director(Website: www.ramada.com)
All the above mentioned people consist of the top management of the Ramada hotels who
have been playing and will continue to play a very important role in the success story of
the Ramada hotels. It is these people who manage the Ramada group.
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http://en.wikipedia.org/wiki/Cendanthttp://en.wikipedia.org/wiki/Wyndham_Worldwidehttp://investing.businessweek.com/research/stocks/people/person.asp?personId=48707204&capId=11419630&previousCapId=11419630&previousTitle=Ramada%20Worldwide%20Inc.http://en.wikipedia.org/wiki/Cendanthttp://en.wikipedia.org/wiki/Wyndham_Worldwidehttp://investing.businessweek.com/research/stocks/people/person.asp?personId=48707204&capId=11419630&previousCapId=11419630&previousTitle=Ramada%20Worldwide%20Inc.8/6/2019 Final Ramada Leadership
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Management means bringing all the people together and efficiently using the human
resource and all the other physical and tangible resource which is limited, to achieve a
common mission or objective. Nowadays the managements have a lot of hurdles in
achieving the common goal. The first hurdle is bringing the people (employees) together
to work on a common goal. The most prominent reason or the cause of this hurdle is the
cultural diversity. When cultural diversity exists it becomes very difficult to bring all the
people from different cultures to work together. Communication problems arise due to
cultural diversity because of the difference in the language used to communicate. Apart
from the communication, the cultural diversity also creates a difference in lifestyles and
opinions. (Website: www.ramada.com)
The second hurdle is choosing a right leader who has excellent leadership skills and who
can definitely bring all the employees together. To be successfully able to do this the
leader should understand the cultural diversities and adopt tactful methods to use the
cultural diversity as strength for the organization rather than as a weakness. (Website:
www.ramada.com)
OBJECTIVE OF THE STUDY
The objective of this project is:
To understand the problems and issues created by cultural diversity in an
organization
To study how efficient leadership and appropriate motivation can help in
integrating the national culture of the employees with the organizational culture
MANAGEMENT THEORIES
The world today is the most dynamic than it ever before was. The nature of the workplace
or the markets are changing dramatically everyday. Even a minor tremor today has the
potential to bring about a thunderstorm and cause havoc. Thus it becomes very important
for the organization to quickly interpret the dynamic situation at hand and take effective
action straight a way. But it is not very easy to interpret the ever changing business
environment. For this purpose the business and management gurus along with a fewbrilliant behavioral psychologists have developed many management theories which help
to interpret the situation at hand and take suitable action. Some of the famous and widely
used management theories are the Systems theory, Contingency theory and the Chaos
theory. (Miner, 2007)
SYSTEMS THEORY
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Before understanding the systems theory it is very important to understand a system.
System can shortly be defined as a group of different things which assemble together to
attain a common objective. Like, if the engine of the automobile is removed the
automobile would not function. Thus in a system every individual part has its own
importance and the entire system gets impacted even because of a small component of the
system. But on the other side a group of stones can not be called a system. T his is
because even if one stone is removed from the group, it would still be called as a group of
stones. One missing stone will not impact the entire group of stones. (Dale, 1969)
The application of the Systems theory on the Ramada hotels is as follows:
Let us consider the kitchen of the Ramada hotels to be one system. The common
objective of the kitchen is to prepare a delicious and tasty food menu which all the
customers would like in spite of their cultural diversity.The input for the Ramada hotels kitchen is human resource in the form of waiters and
chefs and the various other raw materials like vegetables, fruits and meat. The processes
involved in the Ramada kitchen are bringing all the raw materials together to make a
delicious dish. Storing the excess raw materials to use it for the next time is also one
process used in the Ramada kitchen. (Bush, 2003)
The output for this kitchen system is the delicious food items that have been made for the
customers. And finally the outcome is the feedback which is received from the customers
and the internal employees who serve the food to the customers like the waiters in the
hotel. Thus all this components work together in achieving the common goal. The
problem with this was that the Ramada hotels had procured excellent quality rawmaterials to prepare food, they also had goods chefs but the outcome was not good
because they feedback from customers was not good. (Dale, 1969)
Now to resolve this problem the Systems theory is required. If all the parts of the Ramada
hotel kitchen are studied individually, it would be difficult to identify the problem. As per
systems theory the focus should be on the inter-relation between parts of the system. Now
when all the parts are again studied as per the systems theory the cause for a bad feedback
has been identified. The synchronization between the chefs and the waiters is not good.
This has been the root cause for a bad feedback or outcome. Usually what happened was
that, when the waiters took orders from the customers and passed it on to the chefs and
due to poor synchronization the chefs could not prepare the meal for the customers as per
the regular time required to prepare the dish. This lack of co-ordination between the
waiters and chefs resulted in a bad outcome which meant unsatisfied costumers. However
when the management of Ramada hotels used the systems theory, they were able to
identify this problem and resolve it as quickly as possible. (Dale, 1969)
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CONTINGENCY THEORY
Contingency theory is based on the behavioral science which is today used by many HR
departments of huge multi national corporations around the world. As per the contingency
theory there can not be a fixed particular best way to manage an organization. As per this
theory all the decision making can not be pre-decided and it largely depends upon the
various internal and external factors which could be controllable or uncontrollable. Thus
the contingency theory implies that when a manager takes a decision, he or she must
consider all the different aspects of a current situation at hand and act appropriately as per
the situation to best optimize the resources and get the most desirable outcome for the
organization. (Miner, 2007)
The Ramada hotel group used this contingency theory to identify the best leadership style
to be used in its different departments. An autocratic leadership style was used by the
head supervisor of the house keeping department of the Ramada hotel group. The reason
for this leadership style being selected is that the supervisors only objective is to get the
assigned work done from the housekeeping employees in the best possible way and in a
timely manner. The nature of this job is very simple it involves no complexities. Hence
the autocratic leadership style is the best suited for this department after evaluating the
important factors related this department. (Miner, 2007)
On the other hand the public relation (PR) team of the Ramada group uses a participative
or a democratic leadership style. This decision to choose the participative or a democraticleadership style is based on the various factors related to the PR team. The main task of
the PR team at the Ramada group is to maintain excellent relation with the costumers of
the group and also increase the brand awareness of the Ramada group. The nature of this
job is a little complex and thus a lot of brain storming within the PR team is required to
come out with a best possible solution for the objective at hand. The objective of the PR
team is temporary and it keeps changing from event to event. Some times the PR team
may have to organize an event inside the hotel for the Asian costumers and some times
for the Arabian costumers. Now these 2 groups of costumers are culturally different from
each other and hence the objectives of the PR team differ from time to time and from
event to event. Thus in this type of a work environment a participative or a democratic
leadership style is best suited. (Bush, 2003)
ORGANIZATIONAL CULTURE AND NATIONALCULTURE
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Today the Ramada group is operating in a highly volatile global environment. This
volatile environment creates a lot of opportunities for the companies to expand
organically and inorganically in the form of mergers and acquisitions. Thus it is very
important to integrate the national culture with the organizational culture. The national
culture of a person tells him the difference between right and wrong, good and bad,
normal and abnormal etc. The values of the national culture are held very deeply by an
individual and it takes a lot of time to change them. (Miner,2007)
Organizational culture is mainly based on the organizational practices learned during the
job. For individuals it is very easy to learn this new organizational culture.
A person can learn to adapt to processes and priorities of the organizational culture. But if
these priorities and processes go against the deeply held national cultural values of
employees, corporate values (processes and practices) will be undermined. (Alvesson &
Sveningsson, 2007)
Thus it is very important for any multi national organization to properly integrate itsorganizational culture with the national culture of a particular country. If any organization
is not able to properly integrate its organizational culture with the national culture of a
particular country, it could prove to be disastrous for the company. An example of such a
disastrous incident is that of McDonalds India. People in India are mostly hindu and they
do not consume beef as they worship cow. But McDonalds failed to understand this and
some amount of beef content was found in their food items in an Indian outlet. When the
Indian public came to know about this, there were strong protests against McDonalds and
the public outrage caused a lot of damage to the McDonalds property. (Tanner, 1997)
Hence from this incident it is very clear that a multi national company should properly
integrate its organizational culture with the national culture of a particular country.
ISSUES AND PROBLEMS
Form the example of the McDonalds it is very clear that the Ramada group should
properly integrate its organizational culture with the national culture of a particular
country. But the problem here is that since the Ramada group has expanded to several
countries across the world in order to tap the global markets, it has become very difficult
for them to every time integrate its organizational culture with the national culture of a
new country every time they expand into a new business market. Countries like India,
China, Brazil and many other developing countries have a very rich cultural background.
The people from these countries have their national cultural values deeply rooted inside
them and it is almost impossible to change or tamper these national values. And since the
Ramada group is in the hospitality business, the cultural factor becomes very important
for the Ramada group. (Alvesson & Sveningsson, 2007)
Thus the major problem for the Ramada group is to properly integrate its organizational
culture with the national culture of a particular country.
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Since Ramada is originally from the United States of America, it is relatively easy for
them to properly integrate its organizational culture with the national culture of a the
other developed countries like Canada and some European countries like United
Kingdom, France, Switzerland and many more like them. But when the Ramada group
expanded its operations to the developing countries and the other third world countries it
become a little difficult to properly integrate its organizational culture with the national
culture of these countries like India. (Tanner, 1997)
Thus the Ramada group has to identify a feasible, economic and an easy to execute
solution to solve this problem to properly integrate its organizational culture with the
national culture of a new country, every time it expands into. The onus of finding a good
solution for this problem lies with the leaders of the Ramada group.
LEADERSHIPLeadership can be defined as the ability to have an influence on all the other team
members and convince them to work on a common objective. In todays dynamic
business environment which is full of cultural diversity it is very important to have an
efficient leader. (Bennis ,Spreitzer & Cummings,2001)
The task of the leader is to get his people from where they are to where they have not
been. - Henry Kissinger
A leader is not the one who does everything. A leader is the one who makes it possiblefor others to do. - Paulo Freire
Today due to the cultural diversity it has become very important to identify suitable
leaders who can drive the organization on a successful path. But a lot of people tend to
think that the leaders only exist at a senior management level. But this is a common
mistake and leaders can exist at any organizational level. Any employee can be a leader at
any time. A good leader should be able to properly identify the organizational level at
which he or she is functioning and the responsibilities which he has upon him as the
leader. On the basis of levels in an organization we can have 3 types of leaders which are
as follows:
People leader
Organizational leader
Strategic leader
(Siguaw & Smith, 2010)
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PEOPLE LEADERS
People leaders come under the first level of leadership in an organization. They are
basically used by the companys top management to communicate with the employees.
They are given the responsibility of a particular team consisting of a small number of
employees. Their main aim as a people leader is to take care of the day to day operations
of the team and ensure a smooth and a productive work environment. (Daft, 2007)
The Ramada group also uses the people leaders in many of its departments. The
housekeeping department of the Ramada group has people leaders. The waiters in the
restaurants of the Ramada hotels have a people leader.
The Ramada group being a hotel spans across the globe and a result of that they have a
culturally diverse work force. It is the responsibility of the people leader to understand
this diversity in the culture and smoothly convert it into unity. The people leaders spend a
lot of their time with the employees of their group because they are often training them or
monitoring their performance. Thus they often have very good formal and informalcommunications with the employees. This has proved to be an advantage for the people
leaders because it helps them to understand the thought process of the employees. (Daft,
2007)
When the Ramada hotels opened their facility in India, they had to face a lot of issues due
to the large cultural diversity prevalent in India. But to tackle this problem, the top
management of Ramada appointed good people leaders who could handle the employees
in spite of their diversity. (Klaene & Sanders, 2007)
OPERATIONAL LEADERS
Unlike the people leaders the operational leaders do not have the responsibility of onlyone team. They have on them a responsibility of a particular departmental function or
more than one function. They often lead a couple of people leaders who actually have a
very specific task at hand. An example of the operational leader at the Ramada hotels
group is the Food and Beverages (F&B) Manager. The F&B manager has the total
responsibility of the food and the beverages which are served at the restaurants of the
Ramada hotels. In order to successfully execute his or her task, he has to co-ordinate with
many people leaders. This F&B manager at the Ramada group has to manage the people
leader of the housekeeping department, kitchen department (chefs), plates and cutlery
department, raw material procurement department, bar tender department and many more.
This means that the F&B manager has to manage many people leaders who are already
handling the cultural diversity issue. And these people leaders always look up to the
operational leader. Thus the operational leader should have the leadership skills to
influence all his subordinates. (Siguaw & Smith, 2010)
STARTEGIC LEADERS
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The top management of the Ramada group consists of the strategic leaders. These
strategic leaders have the major responsibility of all the important organizational
functions. The main function of the strategic leader is to plan a strategy and effectively
execute the planned strategy. While formulating the strategy they have to keep in mind
the mission and vision of the company and accordingly plan a strategy. The main
objective of the Ramada group is to provide world class amenities with excellent quality
to its costumers. Thus the strategic leaders have to keep this objective in mind while
planning any strategy. (Bennis, Spreitzer & Cummings, 2001)
The Ramada group also wants to maintain its standards throughout the world, where ever
they have a hotel. Keeping in mind this objective, the strategic leaders at Ramada had to
make a strategy for wide expansion and at the same time ensure that quality standards
were maintained. This was a tricky situation for the leaders and they came up with a very
innovative solution. The Ramada group decided to start franchising its outlets. This
strategy proved to be very cost effective and at the same time it also ensured that the
desired quality standards were effectively maintained. Thus this instance proved that thestrategic leaders of Ramada group were successful in implementing a new strategy
keeping in mind the long term objective of the Ramada group. (Siguaw & Smith, 2010)
All these three levels of leaders may have a different leadership style, which could be
participative or autocratic leadership style. The leadership used by the leader depends on
his level and also importantly on the situation at hand. The people leaders at the Ramada
group usually use the autocratic leadership style because they have a specific task at hand
and they keep a centralized power with themselves to ensure that their team successfully
accomplishes the task. The operational and strategic leaders use the participative
leadership style. In the Ramada group the operational and strategic leaders have to tacklecomplex situations and their functions are also complicated. Thus the participative
leadership style is the best suited for them. (Klaene & Sanders, 2007)
PROBLEMS AND ISSUES
As the Ramada group has expanded globally, it has a work force which consists of people
from across the world with vast differences in their national culture. At the same time it is
very difficult for the Ramada group to integrate its organizational culture with so many
different national cultures. And obviously till the problem of cultural diversity is not
resolved it would be very difficult for Ramada group to keep its work properly motivated.
Thus to solve this problem they need to find the right kind of people who can be leaders
at various levels. But again the problem here is that the top management should be able to
identify the most effective leaders. (Daft, 2007)
Thus the objective of the Ramada group is to identify the most suitable leaders who can
understand the organizational culture and national culture and help the Ramada group to
integrate its organizational culture with the national culture. But since the Ramada group
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has its operations in various parts of the world, it is a little difficult for them identify
proper people to be the leaders.
MOTIVATION
Motivation is something which encourages the people. It creates a driving force which
pushes the people to achieve more than they expect. Motivation is very important in the
organizations today. If proper motivation is provided, the employees strive hard to
achieve their target, which in turn helps the organization to achieve its goal. In multi
national companies like the Ramada group, the motivation factor is very important
because they are facing issues like cultural diversities. (Weiner, 1992)
Motivation which an employee can have could be intrinsic or extrinsic. Intrinsic
motivation comes from the employee himself. If the employee enjoys his task and ishighly job satisfied the he would always be self motivated and no other major motivation
is required for him. On the other hand there are a few employees who may not be highly
job satisfied. So for such employees extrinsic motivation is required. (Hoffmann, 2007)
The Ramada group employs a wide range of people. Some could be graduate drop-out,
some could be management pass-outs and some could be well experienced people. Thus
the kind of motivation the employees require will require may vary from person to
person. This difference in the kind of motivation required can be understood from the
Maslow's hierarchy of needs. (Beck, 2004)
MASLOW'S HIERARCHY OF NEEDS
As per Maslows hierarchy of needs there are five categories by which the motivational
requirements of all the employees can be categorized. These five levels are
Physiological
Safety
Love/belonging
Esteem
Self-actualization
The diagram given below depicts the motivational requirements of the employees at all
the five levels.
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Usually when a person starts his professional career, he is at the bottom of the pyramid
and he requires his primary needs to be fulfilled in order to be motivated. Then he moves
one level above and desired professional and personal safety to be motivated. Gradually
the employee keeps moving towards the top of the pyramid, and finally reaches the level
of self-actualization. Usually employees at this level are in a very senior position in the
organization. (Beck, 2004)
Ramada group has employees at all these five levels. The employees like security guards
are at the first level, waiters and housekeepers come at the second level. Supervisors and
chefs are at the third level. Managers are at the fourth level and the finally the people in
the top management are in the fifth level.
PROBLEMS AND ISSUES
This theory of Maslows hierarchy of needs is a very popular theory and almost every
post graduate employee is aware of this theory. But implementing this theory is a very
difficult task. It is not very easy to identify which employee is at which level. It is
possible that a security guard in the Ramada group may not be in the first level but he
could be perhaps at the second or third level. If the organization wrongly identifies the
level of the employee, it could prove to be very disappointing for that particular employeeas he would not be properly motivated. At the same time it also means waste of resource
for the organization as they were not able to motivate the employee as desired. (Beck,
2004)
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Apart from identifying the exact level of the employee, it is also very difficult for the
Ramada group to identify the proper motivational source for the employee. The
motivational source could differ from person to person due to cultural diversity.
For example take two employees of the Ramada group. Both the employees are
supervisors in the Ramada hotel. One is an Indian in a American hotel and another is a
American in an Indian Ramada hotel. The Indian would really be motivated if he is
allowed to meet his family in India at least once a year. On the other hand the American
in India would be motivated if he makes good friends in India and also has romantic
intimacy. The motivation source which motivate the Indian may not motivate the
American and the vice versa is also true. (Weiner, 1992)
Thus it is very important for the Ramada group to identify the proper motivation source
for its employees and as a result bridge the existing gap between the organizational
culture and the national culture.
CONCLUSION & RECOMMENDATION
Since the Ramada group has expanded its operation to many international destinations,
they employee a work force which is culturally diverse. Because of this cultural diversity
in the employees that the Ramada group employees, they have to face several problems
and issues. The first issue the Ramada group faces is the difficulty in integrating its
organizational culture with the national culture of the employees. To successfully
integrate the organizational culture with the national culture of the employees, the
Ramada group needs efficient leaders at various levels like people leaders, operational
leaders and strategic leaders.
The second issue which the Ramada group faces is identifying these efficient leaders who
can understand the organizational culture along with the national culture of the employees
and help in integrating both.
Once the efficient leaders have been identified, the next issue which the Ramada group
faces is the motivating the employees to perform efficiently and identifying the difference
in the motivation sources because of the cultural diversity.
The best possible solution to tackle all these three issues which the Ramada group is
facing is to start franchising its outlets. Franchising is a process by which the Ramada
group allows other people to open facilities and use the brand name of Ramada group. In
return the Ramada group receives a certain share of revenue as the franchising fee.
Franchising would solve the problem of integrating the organizational culture with the
national culture of the employees because the franchised outlet would most certainly be
started by a local resident of a particular country who owns a land where the hotel facility
would be started. Now, since the owner of the franchise is a local native of that particular
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country, he perfectly understands the national culture of his or her country and thus it
would be easy for him to integrate the organizational culture with the national culture of
the employees.
The owner of the franchise can also identify the leaders easily from his local people with
whom he is already familiar with and he would be responsible for the people whom he
has selected as leaders. Thus the issue of identifying leaders which the Ramada group
faced is also resolved by the franchising of outlets.
Finally the last issue which the Ramada group faced was identifying the proper
motivation sources for its employees with respect to their cultural diversity. Franchising
of the outlets will resolve this issue also. As the franchise owner has identified efficient
leaders who can successfully integrate the organizational culture with the national culture
of the employees, the leaders understand the thought process of their team members and
thus identifying the most effective motivational source for the employees will be easy.
Thus by franchising the outlets the Ramada group can easily expand its operations widelyin a very cost effective way and at the same time easily tackle issues like integrating the
organizational culture with the national culture of the employees, identifying efficient
leaders and properly motivating all the employees. Thus franchising the outlets is one for
all solution.
BIBLIOGRAPHY
Website:
www.ramada.com
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M.E. Sharpe
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