Marriott Corporation and Project Chariot
The Marriott Corporation (MC), had seen a long, successful reign in the hospitality industry until the late 1980s. An economic downturn and the 1990 real estate crash resulted in MC owning newly developed hotel properties with no potential buyers in sight and a mound of debt. During the late 1980s, MC had promised in their annual reports to sell off some of their hotel properties and reduce their burden of debt. However, the company made little progress toward fulfilling that promise. During 1992, MC realized that financial results were only slightly up from the previous year and their ability to raise funds in the capital market was severely limited. MC was left with little choice, as they had to consider some major changes within the company if they wished to remain a successful business. Thus, J.W. Marriott, Jr., Chairman of the board and president of MC, turned to Stephen Bollenbach, the new chief financial officer, for ideas and guidance.
Bollenbach, who had a reputation for creating innovative financial structures in the hotel industry, proposed a radical restructuring for MC. Bollenbach’s proposal included breaking MC into two separate entities. The new company would retain the service businesses of MC and have the financial strength to raise capital and take advantage of various investment opportunities. On the other hand, the old company would retain the hotel properties and the pressure to sell properties at reduced prices would be greatly lessened. This drastic restructuring proposal, deemed Project Chariot, had to be evaluated by J.W. Marriott before he went before his board of directors with his ultimate recommendation. Thus, Marriott planned to review the company’s past financial history that led to their current position; evaluate Project Chariot’s advantages, disadvantages and value; determine the bond risk involved if Project Chariot was accepted and finally consider alternative recommendations.
Past History of MC
By the 1980’s, the Marriot Corporation, founded in 1927, had grown into a financially sound, industry-leading corporation. Although MC went public in 1953 and continued to sell stock to the public, the Marriott family still retained the controlling interest of 25% of the company in 1992. Once J.W Marriott Sr. resigned in 1964, his son, J.W. Marriott Jr., took over the posi...
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...th the restructuring proposed by Project Chariot. The Management team of HMC must aggressively restructure its finances in order to alleviate this debt and reduce its risk of bankruptcy or take-over.
Also, if possible actions should be taken to ease the worries of existing bondholders and institutional investors. Management may consider sharing the debt more equally between the two divisions in an effort to prevent downgrading of the credit rating and loss of investors.
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...as going to need to overcome was trust, and being able to articulate a reassuring method that the issues from the past were over and never going to happen again. The company’s reputation was tarnished and Tyco needed to emerge out of the venture into a new form of the company. It had to display that senior management accountability was there and illustrate effectively that the new team in the company had integrity, transparency and the ability to perform, taking the company to a new, higher level than before. The recognition of the GMI rating to 9.0 in 2005, showed that all the work Ed Breen had done worked, and Tyco was in the new generation of their existence (Palmer, Dunford, & Akin, 2009).
Marriott Corporation is an international company who's the growth over the year has been more than satisfactory.
Senior Management of PepsiCo is evaluating the potential acquisition of two companies – Carts of Colorado and California Pizza Kitchen – in order to expand the company’s restaurant business. If indeed PepsiCo decides to pursue the acquisition of one or both, they must decide how to align each of these business units in its historically decentralized management approach and how to forge relationships between the acquired business units and existing business units. In their evaluation, Senior Management is faced with the question of whether the necessary capital investment in order to purchase one or both of the businesses can be profitable for each of the acquired business units, but must also take into consideration that the additional business units will not hinder the profitability of the existing business units.
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Without the overhaul of its management, which had fixed objective also made their objectives unattainable. The corporation was in a state of out of control before the long-range strategic objectives were set in place. GM’s nominal long-range strategic objective “to use its vast financial resources to spend its competitors right into the ground” fell short on critical characteristics of practicability, flexibility, cost effectiveness, and accountability.
[1] Information was mainly taken from the Harvard Business Case Study “The Walt Disney Company: The Entertainment King”
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Finally, Marriott also had to measure how this vision is performing. They are looking at 3 success measures; Loyalty, Profitability and Growth.
But divesture of three out of four divisions leads to a very small portfolio which leads to chances of high risks as well. The process of restructuring and forming a better portfolio would provide the firm with a lot many opportunities including exploring newer and more compatible product lines and segments, thus increasing its opportunities to earn better revenues with efficient management.
She is enthusiastic about life and is very active; it is this characteristic of her that attracts Haroon. It is in Eva that Karim finds comfort of having someone to depend upon whereas he wanted to hate her for being the reason for the family break-up: “The only person I knew who’d be helpful and objective and on my side was Eva. But I wasn’t supposed to like her because her love for my father was buggering up my entire family” (The Buddha of Suburbia, 1990, p.63). Nonetheless, Karim is focussed enough to transgress to the next level of the social class away from the suburbs and accepted Eva’s guidance, “I longed to know what Eva made of things, what she thought of Jamila, say, and the marriage to Changez. I wanted her opinion. Eva could be snobby, that was obvious, but if I saw something, or heard a piece of music, or visited a place, I wouldn’t be content if Eva had made me see it in a certain way. She came at things from an angle; she made connections” (93). To Karim “Eva was unfolding the world for him. It was through her that he became interested in life” (Italics my
A: The police spent years and years trying to discover who was the Zodiac Killer, and there was never a conclusion, but there were many debunked suspects. It was said that most people that were considered suspects were just those who were accused, and their names were later repeated online(“Could Any of These Men Have Been the Zodiac Killer?”). Some of the highlighted suspects were
In the 1970’s, Robert Ressler, who was the previous director of Violent Criminal Apprehension Program with the Federal Bureau of Investigation (FBI), coined the term “serial killer”. He did so because when he was a child, the police in England used to refer to murders such as this as “crimes in a...
b) Managers – that they have very little to no control over their property or employees. It seems like many important decisions have been taken away from managers, and they can not react in the best interest for the hotel chain because what’s in the customer’s best interest is usually not the same as the company’s best interest.
“The objective of this phase is to identify events and or future trends that will affect the hotel industry over the next five years. Also, the impact that those events and trends will have on your business in terms of cost and revenue changes and the timing of the impact.” (Fedele, 2010) For each of the external environment, it is also to identify what will affect the performance of the business.
Whitla, P., Walters, P., Davies, H. 2007, Global strategies in the international hotel industry, Hospitality Management, vol. 26, pp. 777–792.