Is Rationalisation a Desirable Strategy for Managing and Organising Junction Hotel in the Current Economic Climate?

Is rationalisation a desirable strategy for managing and organising Junction Hotel in the current economic climate?

Foundations of managing and organising

BUSI12052

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Is rationalisation a desirable strategy for managing and organising Junction Hotel in the current economic climate?

Junction hotel is facing a number of economic and internal problems that is risking the survival of the business. The problems have arisen from a mix of poor leadership and co-operation of staff within the business and also the external influences, which has led them to compromise on quality of service for profit. With poor service, deteriorating interior, and expensive rooms the hotel is losing customers and therefore losing crucial revenue. Moreover due to the double-dip recession consumers now have less disposable income to be spending on hotels, which will affect Junction Hotel in both short –term and Long-term ways. Simon Chance the newly appointed chairman of the hotel believes the general manager Meg Mortimer’s approach to management is inefficient and is one of the key areas he would like to improve. A method of management he could adopt could be ‘Rational Organisation’.

Rationalisation is a highly effective way of cutting costs and increasing efficiency within a business. This can be done for example by fragmenting production and standardizing processes in order to reduce the costs of training staff. By reducing costs, Junction Hotel may be able to renovate their rooms and restore the appearance of quality the hotel once had.

Henri Ford and Fredrick Taylor first adopted this method of management and made it popular in many organisations in the 1900’s. It is therefore also referred to as ‘Fordism’ and ‘Taylorism’. Fordism is a system, which uses mass-production with three major principles. Firstly the standardization of the product meaning all parts on the product line are made by machines and molds and not by hand. Secondly the use of assembly lines and...