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Leading and Creating Resilience in Good and Bad Times: Indian Hotels Company Limited (IHCL) and the COVID-19 Pandemic

Published 13 Apr 2022
Reference 6735
Region Asia
Summary

When Puneet Chhatwal took over as CEO of Taj Hotels in 2018, he faced an onerous task: improving the financials in a hyper-competitive environment marked by the arrival of foreigners such as Starwood Hotels and online entrants Airbnb and OYO. He perceived that the focus on employee empowerment and welfare (as the basis of service excellence) conflicted with the need to emphasize cost cutting to improve profitability. These inconsistences left managers and staff unsure of the overall strategy. In an attempt to resolve them, the hospitality veteran balanced a top-down drive for change with bottom-up involvement in the strategy-making process. Adept in recognizing and adjusting resource allocation to ensure the parent company IHCL achieved its goals, he delegated tasks to the leadership team and employees but kept them focused on the deliverables. With input from many managers across the organization, a new strategy emerged organically – Aspiration 2022 – that resonated with the entire staff.
By late 2019, staff were reporting a stronger sense of direction in day-to-day operations. With this came increased profitability and stock performance in line with group targets. With the success of the turnaround, the CEO seemed set to pursue his strategic vision through 2022. Little did he know that the strategy-making processes he had put in place would be subjected to upheaval as a result of the imminent COVID-19 pandemic.

Teaching objectives

Understand ‘strategy involvement’ – what it is and how it affects strategy execution. This can include when it is necessary to increase involvement, such as improving coordination and communication between departments. How strategy involvement can be improved by balancing the need for top-down directed change with bottom-up involvement of organizational members. Apply these lessons to the students’ own context using the frameworks provided.
Appropriate Uses:The case is typically used in executive education programmes for a 3-6 hour session. It could also be used for MBA or EMBA classes to illustrate the processes of strategy making.

Keywords
  • Strategy Making
  • Strategy Involvement
  • Strategy Execution
  • Top Down Leadership
  • Bottom up Leadership
  • Coordination between Departments
  • Hotel Management
  • Leadership
  • Human Resource Management
  • Employee Motivation
  • Middle Managers
  • Q22022