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The Ordinary Heroes of the Taj
- Rohit Deshpande
- Anjali Raina
How an Indian hotel chain’s organizational culture nurtured employees who were willing to risk their lives to save their guests
Reprint: R1112J
When terrorists attacked the Indian city of Mumbai in 2008, employees of the Taj Mumbai hotel displayed uncommon valor. They placed the safety of guests over their own well-being, thereby risking—and, in some cases, sacrificing—their lives. Deshpandé, of Harvard Business School, and Raina, of the HBS India Research Center in Mumbai, demonstrate that this behavior was not merely a crisis response. It was instead a manifestation of the Taj Group’s deeply rooted customer-centric culture that, the authors argue, other companies can emulate, both in extreme circumstances and during periods of normalcy.
The key ingredients of this Taj-style customer centricity include:
- a values-driven recruitment system that emphasizes integrity and duty over talent and skills;
- training of customer ambassadors who serve the guest first and the company second; and
- a recognition-as-reward system that values well-earned plaudits—from customers, colleagues, and immediate supervisors—over money and advancement.
Each of the three elements has important features and nuances, which the authors explore in detail so that your company can take its cues.
On November 26, 2008, Harish Manwani, chairman, and Nitin Paranjpe, CEO, of Hindustan Unilever hosted a dinner at the Taj Mahal Palace hotel in Mumbai (Taj Mumbai, for short). Unilever’s directors, senior executives, and their spouses were bidding farewell to Patrick Cescau, the CEO, and welcoming Paul Polman, the CEO-elect. About 35 Taj Mumbai employees, led by a 24-year-old banquet manager, Mallika Jagad, were assigned to manage the event in a second-floor banquet room. Around 9:30, as they served the main course, they heard what they thought were fireworks at a nearby wedding. In reality, these were the first gunshots from terrorists who were storming the Taj.
The staff quickly realized something was wrong. Jagad had the doors locked and the lights turned off. She asked everyone to lie down quietly under tables and refrain from using cell phones. She insisted that husbands and wives separate to reduce the risk to families. The group stayed there all night, listening to the terrorists rampaging through the hotel, hurling grenades, firing automatic weapons, and tearing the place apart. The Taj staff kept calm, according to the guests, and constantly went around offering water and asking people if they needed anything else. Early the next morning, a fire started in the hallway outside, forcing the group to try to climb out the windows. A fire crew spotted them and, with its ladders, helped the trapped people escape quickly. The staff evacuated the guests first, and no casualties resulted. “It was my responsibility….I may have been the youngest person in the room, but I was still doing my job,” Jagad later told one of us. Elsewhere in the hotel, the upscale Japanese restaurant Wasabi by Morimoto was busy at 9:30 PM . A warning call from a hotel operator alerted the staff that terrorists had entered the building and were heading toward the restaurant. Forty-eight-year-old Thomas Varghese, the senior waiter at Wasabi, immediately instructed his 50-odd guests to crouch under tables, and he directed employees to form a human cordon around them. Four hours later, security men asked Varghese if he could get the guests out of the hotel. He decided to use a spiral staircase near the restaurant to evacuate the customers first and then the hotel staff. The 30-year Taj veteran insisted that he would be the last man to leave, but he never did get out. The terrorists gunned him down as he reached the bottom of the staircase. When Karambir Singh Kang, the Taj Mumbai’s general manager, heard about the attacks, he immediately left the conference he was attending at another Taj property. He took charge at the Taj Mumbai the moment he arrived, supervising the evacuation of guests and coordinating the efforts of firefighters amid the chaos. His wife and two young children were in a sixth-floor suite, where the general manager traditionally lives. Kang thought they would be safe, but when he realized that the terrorists were on the upper floors, he tried to get to his family. It was impossible. By midnight the sixth floor was in flames, and there was no hope of anyone’s surviving. Kang led the rescue efforts until noon the next day. Only then did he call his parents to tell them that the terrorists had killed his wife and children. His father, a retired general, told him, “Son, do your duty. Do not desert your post.” Kang replied, “If it [the hotel] goes down, I will be the last man out.”
Three years ago, when armed terrorists attacked a dozen locations in Mumbai—including two luxury hotels, a hospital, the railway station, a restaurant, and a Jewish center—they killed as many as 159 people, both Indians and foreigners, and gravely wounded more than 200. The assault, known as 26/11, scarred the nation’s psyche by exposing the country’s vulnerability to terrorism, although India is no stranger to it. The Taj Mumbai’s burning domes and spires, which stayed ablaze for two days and three nights, will forever symbolize the tragic events of 26/11.
During the onslaught on the Taj Mumbai, 31 people died and 28 were hurt, but the hotel received only praise the day after. Its guests were overwhelmed by employees’ dedication to duty, their desire to protect guests without regard to personal safety, and their quick thinking. Restaurant and banquet staff rushed people to safe locations such as kitchens and basements. Telephone operators stayed at their posts, alerting guests to lock doors and not step out. Kitchen staff formed human shields to protect guests during evacuation attempts. As many as 11 Taj Mumbai employees—a third of the hotel’s casualties—laid down their lives while helping between 1,200 and 1,500 guests escape.
At some level, that isn’t surprising. One of the world’s top hotels, the Taj Mumbai is ranked number 20 by Condé Nast Traveler in the overseas business hotel category. The hotel is known for the highest levels of quality, its ability to go many extra miles to delight customers, and its staff of highly trained employees, some of whom have worked there for decades. It is a well-oiled machine, where every employee knows his or her job, has encyclopedic knowledge about regular guests, and is comfortable taking orders.
Even so, the Taj Mumbai’s employees gave customer service a whole new meaning during the terrorist strike. What created that extreme customer-centric culture of employee after employee staying back to rescue guests when they could have saved themselves? What can other organizations do to emulate that level of service, both in times of crisis and in periods of normalcy? Can companies scale up and perpetuate extreme customer centricity?
Our studies show that the Taj employees’ actions weren’t prescribed in manuals; no official policies or procedures existed for an event such as 26/11. Some contextual factors could have had a bearing, such as India’s ancient culture of hospitality; the values of the House of Tata, which owns the Taj Group; and the Taj Mumbai’s historical roots in the patriotic movement for a free India. The story, probably apocryphal, goes that in the 1890s, when security men denied J.N. Tata entry into the Royal Navy Yacht Club, pointing to a board that apparently said “No Entry for Indians and Dogs,” he vowed to set up a hotel the likes of which the British had never seen. The Taj opened its doors in 1903.
Still, something unique happened on 26/11. We believe that the unusual hiring, training, and incentive systems of the Taj Group—which operates 108 hotels in 12 countries—have combined to create an organizational culture in which employees are willing to do almost anything for guests. This extraordinary customer centricity helped, in a moment of crisis, to turn its employees into a band of ordinary heroes. To be sure, no single factor can explain the employees’ valor. Designing an organization for extreme customer centricity requires several dimensions, the most critical of which we describe in this article.
The Taj Approach to HR
fresh recruits rather than lateral hires.
from small towns and semiurban areas, not metros.
from high schools and second-tier business schools rather than colleges and premier B-schools.
managers who seek a single-company career and will be hands-on.
more on hiring people with integrity and devotion to duty than on acquiring those with talent and skills.
workers for 18 months, not just 12.
that employees can deal with guests without consulting a supervisor.
people to improvise rather than do things by the book.
that employees place guests’ interests over the company’s.
incumbent managers, not consultants, conduct training.
timely recognition, not money, as reward.
that recognition comes from immediate supervisors, not top management.
A Values-Driven Recruitment System
The Taj Group’s three-pronged recruiting system helps to identify people it can train to be customer-centric. Unlike other companies that recruit mainly from India’s metropolitan areas, the chain hires most of its frontline staff from smaller cities and towns such as Pune (not Mumbai); Chandigarh and Dehradun (not Delhi); Trichirappalli and Coimbatore (not Chennai); Mysore and Manipal (not Bangalore); and Haldia (not Calcutta). According to senior executives, the rationale is neither the larger size of the labor pool outside the big cities nor the desire to reduce salary costs, although both may be additional benefits. The Taj Group prefers to go into the hinterland because that’s where traditional Indian values—such as respect for elders and teachers, humility, consideration of others, discipline, and honesty—still hold sway. In the cities, by contrast, youngsters are increasingly driven by money, are happy to cut corners, and are unlikely to be loyal to the company or empathetic with customers.
The Taj Group prefers to recruit employees from the hinterland because that’s where traditional Indian values still hold sway.
The Taj Group believes in hiring young people, often straight out of high school. Its recruitment teams start out in small towns and semiurban areas by identifying schools that, in the local people’s opinion, have good teaching standards. They call on the schools’ headmasters to help them choose prospective candidates. Contrary to popular perception, the Taj Group doesn’t scout for the best English speakers or math whizzes; it will even recruit would-be dropouts. Its recruiters look for three character traits: respect for elders (how does he treat his teachers?); cheerfulness (does she perceive life positively even in adversity?); and neediness (how badly does his family need the income from a job?).
The chosen few are sent to the nearest of six residential Taj Group skill-certification centers, located in the metros. The trainees learn and earn for the next 18 months, staying in no-rent company dormitories, eating free food, and receiving an annual stipend of about 5,000 rupees a month (roughly $100) in the first year, which rises to 7,000 rupees a month ($142) in the second year. Trainees remit most of their stipends to their families, because the Taj Group pays their living costs. As a result, most work hard and display good values despite the temptations of the big city, and they want to build careers with the Taj Group. The company offers traineeships to those who exhibit potential and haven’t made any egregious errors or dropped out.
One level up, the Taj Group recruits supervisors and junior managers from approximately half of the more than 100 hotel-management and catering institutes in India. It cultivates relationships with about 30 through a campus-connect program under which the Taj Group trains faculty and facilitates student visits. It maintains about 10 permanent relationships while other institutes rotate in and out of the program. Although the Taj Group administers a battery of tests to gauge candidates’ domain knowledge and to develop psychometric profiles, recruiters admit that they primarily assess the prospects’ sense of values and desire to contribute. What the Taj Group looks for in managers is integrity, along with the ability to work consistently and conscientiously, to always put guests first, to respond beyond the call of duty, and to work well under pressure.
For the company’s topmost echelons, the Taj Group signs up 50 or so management trainees every year from India’s second- and third-tier B-schools such as Infinity Business School, in Delhi, or Symbiosis Institute, in Pune, usually for functions such as marketing or sales. It doesn’t recruit from the premier institutions, as the Taj Group has found that MBA graduates from lower-tier B-schools want to build careers with a single company, tend to fit in better with a customer-centric culture, and aren’t driven solely by money. A hotelier must want, above all else, to make other people happy, and the Taj Group keeps that top of mind in its recruitment processes.
Training Customer Ambassadors
The Taj Group has a long history of training and mentoring, which helps to sustain its customer centricity. The practice began in the 1960s, when CEO Ajit Kerkar—who personally interviewed every recruit, including cooks, bellhops, and wait staff, before employing them—mentored generations of employees. The effort has become more process-driven over time.
Most hotel chains train frontline employees for 12 months, on average, but the Taj Group insists on an 18-month program. Managers, too, go through 18 months of classroom and on-the-job operations training. For instance, trainee managers will spend a fortnight focusing on service in the Taj Group’s training restaurant and the next 15 days working hands-on in a hotel restaurant.
The Taj Group’s experience and research has shown that employees make 70% to 80% of their contacts with guests in an unsupervised environment. Training protocols therefore assume, first, that employees will usually have to deal with guests without supervision—that is, employees must know what to do and how to do it, whatever the circumstances, without needing to turn to a supervisor.
One tool the company uses is a two-hour weekly debriefing session with every trainee, who must answer two questions: What did you learn this week? What did you see this week? The process forces trainee managers to absorb essential concepts in the classroom, try out newfound skills in live settings, and learn to negotiate the differences between them. This helps managers develop the ability to sense and respond on the fly.
The Taj Group also estimates that a 24-hour stay in a hotel results in between 40 and 45 guest-employee interactions, which it labels “moments of truth.” This leads to the second key assumption underlying its programs: It must train employees to manage those interactions so that each one creates a favorable impression on the guest. To ensure that result, the company imparts three kinds of skills: technical skills, so that employees master their jobs (for instance, wait staff must know foods, wines, how to serve, and so on); grooming, personality, and language skills, which are hygiene factors; and customer-handling skills, so that employees learn to listen to guests, understand their needs, and customize service or improvise to meet those needs.
In a counterintuitive twist, the Taj Group insists that employees must act as the customer’s, not the company’s, ambassadors. Employees obviously represent the chain, but that logic could become counterproductive if they start watching out for the hotel’s interests, not the guests’, especially at moments of truth. Trainees are assured that the company’s leadership, right up to the CEO, will support any employee decision that puts guests front and center and that shows that employees did everything possible to delight them.
Trainees are assured that the company’s leadership, right up to the CEO, will support any employee decision that puts guests front and center.
According to senior executives, this shift in perspective changes the way employees respond to situations. Moreover, it alters the extent to which they act—and believe they can act—in order to please guests. A senior executive told us that when an irate guest swore he would never stay at the Taj Mumbai again because the air conditioner hadn’t worked all night, a trainee manager offered him breakfast on the house and provided complimentary transportation to the airport. She also ensured that someone from the next Taj property at which he was booked picked him up from the airport. Did the trainee spend a lot of the company’s money on a single guest? Yes. Did she have to ask for permission or justify her actions? No. In the Taj Group’s unwritten rule book, all that mattered was that the employee did her best to mollify an angry guest so that he would return to the Taj.
The Taj Group’s training programs not only motivate employees, but they also create a favorable organizational culture. H.N. Shrinivas, the senior vice president of human resources for the Taj Group, notes: “If you empower employees to take decisions as agents of the customer, it energizes them and makes them feel in command.” That’s in part why the Taj Group has won Gallup’s Great Workplace Award in India for two years in a row.
Incumbent managers conduct all the training in the Taj Group, which uses few consultants. This allows the chain to impart not just technical skills but also the tacit knowledge, values, and elements of organizational culture that differentiate it from the competition. Every hotel has a training manager to coordinate the process, and given that Taj properties impart training only in the areas in which they excel, they vie with one another to become training grounds.
Like all the other companies in the House of Tata, the Taj Group uses the Tata Leadership Practices framework, which lays out three sets of leadership competencies that managers must develop: leadership of results, business, and people. Every year 150 to 200 managers attend training sessions designed to address those competencies. The company thereafter tailors plans on the basis of individuals’ strengths and weaknesses, and it hires an external coach to support each manager on his or her leadership journey.
The Taj Group expects managers to lead by example. For instance, after a day of work, the general manager of every hotel is expected to be in the lobby in the evenings, to welcome guests. That might seem old-fashioned, but that’s the Taj tradition of hospitality.
A Recognition-as-Reward System
Underpinning the Taj Group’s rewards system is the notion that happy employees lead to happy customers. One way of ensuring that outcome, the organization believes, is to show that it values the efforts of both frontline and heart-of-the house employees by thanking them personally. These expressions of gratitude, senior executives find, must come from immediate supervisors, who are central in determining how employees feel about the company. In addition, the timing of the recognition is usually more important than the reward itself.
Using these ideas, in 2001 the Taj Group created a Special Thanks and Recognition System (STARS) that links customer delight to employee rewards. Employees accumulate points throughout the year in three domains: compliments from guests, compliments from colleagues, and their own suggestions. Crucially, at the end of each day, a STARS committee comprising each hotel’s general manager, HR manager, training manager, and the concerned department head review all the nominations and suggestions. The members of this group decide whether the compliments are evidence of exceptional performance and if the employee’s suggestions are good. Then they post their comments on the company’s intranet. If the committee doesn’t make a decision within 48 hours, the employee gets the points by default.
By accumulating points, Taj Group employees aspire to reach one of five performance levels: the managing director’s club; the COO’s club; and the platinum, gold, and silver levels. Departments honor workers who reach those last three levels with gift vouchers, STARS lapel pins, and STARS shields and trophies, whereas the hotel bestows the COO’s club awards. At an annual organization-wide celebration called the Taj Business Excellence Awards ceremony, employees who have made the managing director’s club get crystal trophies, gift vouchers, and certificates.
According to independent experts, the Taj Group’s service standards and customer-retention rates rose after it launched the STARS program, because employees felt that their contributions were valued. In fact, STARS won the Hermes Award in 2002 for the best human resource innovation in the global hospitality industry. The Taj Group’s hiring, training, and recognition systems have together created an extraordinary service culture, but you may still wonder if the response of the Taj Mumbai’s employees to 26/11 was unique. Perhaps. Perhaps not.
At about 9:30 AM on December 26, 2004, a tsunami rippled across the Indian Ocean, wreaking havoc on coastal populations from Indonesia to India, killing about 185,000 people. Among those affected was the island nation of the Maldives, where tidal waves devastated several resort hotels, including two belonging to the Taj Group: the Taj Exotica and the Taj Coral Reef.
Many guests were panic-stricken, but the Taj staff members remained calm and optimistic.
As soon as the giant waves struck, guests say, Taj Group employees rushed to every room and escorted them to high ground. Women and children were sheltered in the island’s only two-story building. Many guests were panic-stricken, believing that more waves could follow, but staff members remained calm and optimistic.
No more waves arrived, but the first one had inundated kitchens and storerooms. A Taj Group team, led by the head chef, immediately set about salvaging food supplies, carrying cooking equipment to high ground, and preparing a hot meal. Housekeeping staff retrieved furniture from the lagoon, pumped water out of a restaurant, and restored a semblance of normalcy. Despite the trying circumstances, lunch was served by 1:00 PM .
The two Taj hotels continued to improvise for two more days until help arrived from India, and then they evacuated all the guests to Chennai in an aircraft that the Taj Group had chartered. There were no casualties and no panic, according to guests, some of whom were so thankful that they later volunteered to help rebuild the island nation. These Taj Group employees behaved like ordinary heroes, just as their colleagues at the Taj Mumbai would four years later. That, it appears, is indeed the Taj Way.
- RD Rohit Deshpande is Sebastian S. Kresge Professor of Marketing at the Harvard Business School.
- AR Anjali Raina is the executive director of the HBS India Research Center in Mumbai.
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Terror at the Taj
On November 26, 2008, 175 people died in Mumbai, India, when 10 terrorists simultaneously struck sites. Of the five locations—all well-known landmarks—the beautiful domes of the hotel known as the Taj Mahal Palace and Tower would become most closely associated with the horrific attacks in the world's collective conscience.
“Not even the senior managers could explain the behavior of these employees.”
A new multimedia case by HBS professor Rohit Deshpandé offers a flip side to the nightmarish scenes that unfolded in real time on television screens around the globe. Produced in collaboration with Ruth Page and David Habeeb of the HBS Educational Technology Group, Terror at the Taj Bombay: Customer-Centric Leadership documents the bravery and resourcefulness shown by rank-and-file employees during the siege.
Video interviews with hotel staff and senior executives, combined with security footage of the attack, create a documentary-like account of events that took place over the course of 59 hours. The case also covers the hotel's history, its approach to training employees, the "guest is God" philosophy inherent in Indian culture, and the question of how the hotel will recover after the attacks.
Underlying this framework is a central conundrum: Why did the Taj employees stay at their posts, jeopardizing their safety in order to save hotel guests? And is this level of loyalty and dedication something that can be replicated and scaled elsewhere?
"Not even the senior managers could explain the behavior of these employees," says Deshpandé. "In the interview, the vice chairman of the company says that they knew all the back exits—the natural human instinct would be to flee. These are people who instinctively did the right thing. And in the process, some of them, unfortunately, gave their lives to save guests." A dozen employees died.
Most Difficult Case
Deshpandé, a native of Bombay (now Mumbai), says it took a full week to conduct the interviews. "This is the hardest case I've ever worked on. One reason is that I had no conception of what it would be like to have people confront the trauma again. We objectify it, keep emotion at a distance, but after 15 minutes of questions with a video camera in a darkened room, there are deeper, more personal reflections of what happened. It was really, really hard.
"The other thing is that I grew up there. So the Taj is part of my memories, too. As one of the interview subjects said, the Taj is their Taj, meaning anyone who has ever walked through its doors. It's a place that means many things to many people."
In one interview, Taj general manager Karambir Singh Kang describes his father, a military man, telling him that his job is like being the captain of a ship. "I think that's the way everyone else felt, too," says Kang. "A sense of loyalty to the hotel, a sense of responsibility to the guests." Several hours into the siege, Kang's wife and two young sons died in a fire that swept through their apartment on the hotel's top floor. Even after receiving the news, he insisted on staying at his post to help direct a response to the ongoing attack. (The battle for control at the Taj would continue a full two days after other locations had been secured.)
Nothing in the employees' training could have prepared them for such an unprecedented situation, Deshpandé says. Yet further interviews and text documents from the case provide background on the unique culture of Tata Sons, the Taj's parent company, while also revealing the exacting process for selecting, training, and rewarding Taj employees for their work.
Mandate To Delight
Awards are given for longer terms of service, for example, with Group Chairman Ratan Tata (HBS AMP 71, 1975) personally recognizing those who have served 10 to 35 years and more. Employees who have demonstrated outstanding service are selected for inclusion in the Managing Directors Club and recognized across the organization.
Such incentives aren't so unusual, of course. But interviews with senior management demonstrate how seriously the task of building a customer-centric culture and value system is taken at the Taj and its parent company, Indian Hotels.
"Every time they interact with a guest they should look for an opportunity to delight him," says H.N. Srinivas, senior vice president of human resources. During a 24-hour stay, a guest will have an average of 40 to 42 contacts with employees. "We've mapped it," he explains.
When it comes to selecting employees, Indian Hotels CEO Raymond N. Bickson describes how he first looks for "nice people who are not afraid of serving people." He can teach them to be a bellman, a waiter, or a desk clerk, he continues. "But I can't teach them to be nice. I can't teach that spirit of ownership."
"In India and the developing world, there's a much more paternalistic equation between employer and employee," says Ratan Tata, chairman of Tata Sons. "I think that creates a kinship." Every employee donates a small portion of their salary to a pool that can be drawn on in the event a colleague suffers an accident or other significant personal setback.
To date, Deshpandé has taught the case in the School's Owner/President Management Executive Education program; he expects it to be used more widely, particularly since it can also be taught as an example of managing the postcrisis recovery of a flagship corporate brand.
No Clear Answer
The question of why the Taj employees demonstrated such loyalty elicited a variety of responses from students, Deshpandé says.
"For example, some suggested that it has to do with governance of the Tatas; two-thirds of their profits are donated to charitable causes, so the employees feel that they are working for a higher good." But the IT firm Tata Consultancy Services has had many of the same difficulties with employee retention that other Indian IT firms experience. "In that case, the loyalty might be more to self rather than to the organization," he says.
A definitive answer to the question of why the Taj employees behaved as they did may not be possible; but managers who read and view the case will likely come away with a clearer sense of what it takes to build a particular culture and value system and how to recruit, train, and reward employees in nonmonetary ways.
"It's all of those very specific things that build a customer-centric culture in an organization," Deshpandé says. "This example far exceeds anything I've seen before."
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26/11 Response by Taj staff A case study at Harvard
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Response by Taj employees to 26/11 a case study at Harvard
You're reading.
The study mainly focusses on "why did the Taj employees stay at their posts (during the attacks), jeopardising their safety in order to save hotel guests" and how can that level of loyalty and dedication be replicated elsewhere.
A dozen Taj employees died trying to save the lives of the hotel guests during the attacks.
"Not even the senior managers could explain the behaviour of these employees," Deshpande is quoted as saying in HBS Working Knowledge, a forum on the faculty's research and ideas.
Deshpande said even though the employees "knew all the back exits" in the hotel and could have easily fled the building, some stayed back to help the guests.
"The natural human instinct would be to flee. These are people who instinctively did the right thing. And in the process, some of them, unfortunately, gave their lives to save guests."
A documentary-style account of events, the case includes video interviews with hotel staff and footage of the attack.
It shows how leadership displayed by people in the bottom rank to the top levels in the organisational hierarchy helped in saving lives.
It also focusses on the hotel's history, its approach to recruiting and training employees, the Indian culture's "guest is God" philosophy and how the hotel would recover after the attacks.
Another key concept of the study is that in India and the developing world, "there is a much more paternalistic equation between employer and employee that creates a kinship."
Terming it as one of the "hardest cases" he has worked on, Mumbai-native Deshpande said it was hard to see people confront their trauma again.
"We objectify it, keep emotion at a distance, but after 15 minutes of questions with a video camera in a darkened room, there are deeper, more personal reflections of what happened," he says in the HBS Working Knowledge.
Deshpande said Taj employees felt a sense of loyalty to the hotel as well as a sense of responsibility to the guests.
He cites the example of a general manager who insisted on staying put and help direct a response to the attack even after learning that his wife and sons had died in a fire on the hotel's top floor.
"Nothing in the employees' training could have prepared them for such an unprecedented situation," Deshpande said.
Deshpande has taught the case in the School's Owner/President Management Executive Education programme.
It can also be taught as an example of managing the post-crisis recovery of a flagship corporate brand, he added.
-With PTI inputs Edited By: AtMigration Published On: Jan 27, 2011 --- ENDS ---
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Taj Hotel Group Harvard Case Solution & Analysis
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RK Krishna Kumar, managing director and head of Taj Hotel, has to decide whether to revise the promotion decisions. In an effort to deliver quality services that meet international standards in the Indian hotel chain, Kumar introduced a new personnel management system in the company. As a result, the committee is now responsible for the decision that managers should be promoted to senior positions in the company. COO Taj, one of the most respected executives in the company, requested that the committee's decision will be canceled. Kumar should respect the choice of the committee or treat its request to revise its popular manager. "Hide by Thomas J. DeLong, Vineeta Vijayaraghavan Source : Harvard Business School 11 pages. Publication Date: July 23, 2002. Prod. #: 403004-PDF-ENG
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Taj Hotel Group
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Taj Hotel Group Case Study Solution & Analysis
In most courses studied at Harvard Business schools, students are provided with a case study. Major HBR cases concerns on a whole industry, a whole organization or some part of organization; profitable or non-profitable organizations. Student’s role is to analyze the case and diagnose the situation, identify the problem and then give appropriate recommendations and steps to be taken.
To make a detailed case analysis, student should follow these steps:
STEP 1: Reading Up Harvard Case Study Method Guide:
Case study method guide is provided to students which determine the aspects of problem needed to be considered while analyzing a case study. It is very important to have a thorough reading and understanding of guidelines provided. However, poor guide reading will lead to misunderstanding of case and failure of analyses. It is recommended to read guidelines before and after reading the case to understand what is asked and how the questions are to be answered. Therefore, in-depth understanding f case guidelines is very important.
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STEP 2: Reading The Taj Hotel Group Harvard Case Study:
To have a complete understanding of the case, one should focus on case reading. It is said that case should be read two times. Initially, fast reading without taking notes and underlines should be done. Initial reading is to get a rough idea of what information is provided for the analyses. Then, a very careful reading should be done at second time reading of the case. This time, highlighting the important point and mark the necessary information provided in the case. In addition, the quantitative data in case, and its relations with other quantitative or qualitative variables should be given more importance. Also, manipulating different data and combining with other information available will give a new insight. However, all of the information provided is not reliable and relevant.
When having a fast reading, following points should be noted:
- Nature of organization
- Nature if industry in which organization operates.
- External environment that is effecting organization
- Problems being faced by management
- Identification of communication strategies.
- Any relevant strategy that can be added.
- Control and out-of-control situations.
When reading the case for second time, following points should be considered:
- Decisions needed to be made and the responsible Person to make decision.
- Objectives of the organization and key players in this case.
- The compatibility of objectives. if not, their reconciliations and necessary redefinition.
- Sources and constraints of organization from meeting its objectives.
After reading the case and guidelines thoroughly, reader should go forward and start the analyses of the case.
STEP 3: Doing The Case Analysis Of Taj Hotel Group:
To make an appropriate case analyses, firstly, reader should mark the important problems that are happening in the organization. There may be multiple problems that can be faced by any organization. Secondly, after identifying problems in the company, identify the most concerned and important problem that needed to be focused.
Firstly, the introduction is written. After having a clear idea of what is defined in the case, we deliver it to the reader. It is better to start the introduction from any historical or social context. The challenging diagnosis for Taj Hotel Group and the management of information is needed to be provided. However, introduction should not be longer than 6-7 lines in a paragraph. As the most important objective is to convey the most important message for to the reader.
After introduction, problem statement is defined. In the problem statement, the company’s most important problem and constraints to solve these problems should be define clearly. However, the problem should be concisely define in no more than a paragraph. After defining the problems and constraints, analysis of the case study is begin.
STEP 4: SWOT Analysis of the Taj Hotel Group HBR Case Solution:
SWOT analysis helps the business to identify its strengths and weaknesses, as well as understanding of opportunity that can be availed and the threat that the company is facing. SWOT for Taj Hotel Group is a powerful tool of analysis as it provide a thought to uncover and exploit the opportunities that can be used to increase and enhance company’s operations. In addition, it also identifies the weaknesses of the organization that will help to be eliminated and manage the threats that would catch the attention of the management.
This strategy helps the company to make any strategy that would differentiate the company from competitors, so that the organization can compete successfully in the industry. The strengths and weaknesses are obtained from internal organization. Whereas, the opportunities and threats are generally related from external environment of organization. Moreover, it is also called Internal-External Analysis.
In the strengths, management should identify the following points exists in the organization:
- Advantages of the organization
- Activities of the company better than competitors.
- Unique resources and low cost resources company have.
- Activities and resources market sees as the company’s strength.
- Unique selling proposition of the company.
WEAKNESSES:
- Improvement that could be done.
- Activities that can be avoided for Taj Hotel Group.
- Activities that can be determined as your weakness in the market.
- Factors that can reduce the sales.
- Competitor’s activities that can be seen as your weakness.
OPPORTUNITIES:
- Good opportunities that can be spotted.
- Interesting trends of industry.
- Change in technology and market strategies
- Government policy changes that is related to the company’s field
- Changes in social patterns and lifestyles.
- Local events.
Following points can be identified as a threat to company:
- Company’s facing obstacles.
- Activities of competitors.
- Product and services quality standards
- Threat from changing technologies
- Financial/cash flow problems
- Weakness that threaten the business.
Following points should be considered when applying SWOT to the analysis:
- Precise and verifiable phrases should be sued.
- Prioritize the points under each head, so that management can identify which step has to be taken first.
- Apply the analyses at proposed level. Clear yourself first that on what basis you have to apply SWOT matrix.
- Make sure that points identified should carry itself with strategy formulation process.
- Use particular terms (like USP, Core Competencies Analyses etc.) to get a comprehensive picture of analyses.
STEP 5: PESTEL/ PEST Analysis of Taj Hotel Group Case Solution:
Pest analyses is a widely used tool to analyze the Political, Economic, Socio-cultural, Technological, Environmental and legal situations which can provide great and new opportunities to the company as well as these factors can also threat the company, to be dangerous in future.
Pest analysis is very important and informative. It is used for the purpose of identifying business opportunities and advance threat warning. Moreover, it also helps to the extent to which change is useful for the company and also guide the direction for the change. In addition, it also helps to avoid activities and actions that will be harmful for the company in future, including projects and strategies.
To analyze the business objective and its opportunities and threats, following steps should be followed:
- Brainstorm and assumption the changes that should be made to organization. Answer the necessary questions that are related to specific needs of organization
- Analyze the opportunities that would be happen due to the change.
- Analyze the threats and issues that would be caused due to change.
- Perform cost benefit analyses and take the appropriate action.
Pest analysis
PEST FACTORS:
- Next political elections and changes that will happen in the country due to these elections
- Strong and powerful political person, his point of view on business policies and their effect on the organization.
- Strength of property rights and law rules. And its ratio with corruption and organized crimes. Changes in these situation and its effects.
- Change in Legislation and taxation effects on the company
- Trend of regulations and deregulations. Effects of change in business regulations
- Timescale of legislative change.
- Other political factors likely to change for Taj Hotel Group.
ECONOMICAL:
- Position and current economy trend i.e. growing, stagnant or declining.
- Exchange rates fluctuations and its relation with company.
- Change in Level of customer’s disposable income and its effect.
- Fluctuation in unemployment rate and its effect on hiring of skilled employees
- Access to credit and loans. And its effects on company
- Effect of globalization on economic environment
- Considerations on other economic factors
SOCIO-CULTURAL:
- Change in population growth rate and age factors, and its impacts on organization.
- Effect on organization due to Change in attitudes and generational shifts.
- Standards of health, education and social mobility levels. Its changes and effects on company.
- Employment patterns, job market trend and attitude towards work according to different age groups.
case study solutions
- Social attitudes and social trends, change in socio culture an dits effects.
- Religious believers and life styles and its effects on organization
- Other socio culture factors and its impacts.
TECHNOLOGICAL:
- Any new technology that company is using
- Any new technology in market that could affect the work, organization or industry
- Access of competitors to the new technologies and its impact on their product development/better services.
- Research areas of government and education institutes in which the company can make any efforts
- Changes in infra-structure and its effects on work flow
- Existing technology that can facilitate the company
- Other technological factors and their impacts on company and industry
These headings and analyses would help the company to consider these factors and make a “big picture” of company’s characteristics. This will help the manager to take the decision and drawing conclusion about the forces that would create a big impact on company and its resources.
STEP 6: Porter’s Five Forces/ Strategic Analysis Of The Taj Hotel Group Case Study:
To analyze the structure of a company and its corporate strategy, Porter’s five forces model is used. In this model, five forces have been identified which play an important part in shaping the market and industry. These forces are used to measure competition intensity and profitability of an industry and market.
porter’s five forces model
These forces refers to micro environment and the company ability to serve its customers and make a profit. These five forces includes three forces from horizontal competition and two forces from vertical competition. The five forces are discussed below:
- THREAT OF NEW ENTRANTS:
- as the industry have high profits, many new entrants will try to enter into the market. However, the new entrants will eventually cause decrease in overall industry profits. Therefore, it is necessary to block the new entrants in the industry. following factors is describing the level of threat to new entrants:
- Barriers to entry that includes copy rights and patents.
- High capital requirement
- Government restricted policies
- Switching cost
- Access to suppliers and distributions
- Customer loyalty to established brands.
- THREAT OF SUBSTITUTES:
- this describes the threat to company. If the goods and services are not up to the standard, consumers can use substitutes and alternatives that do not need any extra effort and do not make a major difference. For example, using Aquafina in substitution of tap water, Pepsi in alternative of Coca Cola. The potential factors that made customer shift to substitutes are as follows:
- Price performance of substitute
- Switching costs of buyer
- Products substitute available in the market
- Reduction of quality
- Close substitution are available
- DEGREE OF INDUSTRY RIVALRY:
- the lesser money and resources are required to enter into any industry, the higher there will be new competitors and be an effective competitor. It will also weaken the company’s position. Following are the potential factors that will influence the company’s competition:
- Competitive advantage
- Continuous innovation
- Sustainable position in competitive advantage
- Level of advertising
- Competitive strategy
- BARGAINING POWER OF BUYERS:
- it deals with the ability of customers to take down the prices. It mainly consists the importance of a customer and the level of cost if a customer will switch from one product to another. The buyer power is high if there are too many alternatives available. And the buyer power is low if there are lesser options of alternatives and switching. Following factors will influence the buying power of customers:
- Bargaining leverage
- Switching cost of a buyer
- Buyer price sensitivity
- Competitive advantage of company’s product
- BARGAINING POWER OF SUPPLIERS:
- this refers to the supplier’s ability of increasing and decreasing prices. If there are few alternatives o supplier available, this will threat the company and it would have to purchase its raw material in supplier’s terms. However, if there are many suppliers alternative, suppliers have low bargaining power and company do not have to face high switching cost. The potential factors that effects bargaining power of suppliers are the following:
- Input differentiation
- Impact of cost on differentiation
- Strength of distribution centers
- Input substitute’s availability.
STEP 7: VRIO Analysis of Taj Hotel Group:
Vrio analysis for Taj Hotel Group case study identified the four main attributes which helps the organization to gain a competitive advantages. The author of this theory suggests that firm must be valuable, rare, imperfectly imitable and perfectly non sustainable. Therefore there must be some resources and capabilities in an organization that can facilitate the competitive advantage to company. The four components of VRIO analysis are described below: VALUABLE: the company must have some resources or strategies that can exploit opportunities and defend the company from major threats. If the company holds some value then answer is yes. Resources are also valuable if they provide customer satisfaction and increase customer value. This value may create by increasing differentiation in existing product or decrease its price. Is these conditions are not met, company may lead to competitive disadvantage. Therefore, it is necessary to continually review the Taj Hotel Group company’s activities and resources values. RARE: the resources of the Taj Hotel Group company that are not used by any other company are known as rare. Rare and valuable resources grant much competitive advantages to the firm. However, when more than one few companies uses the same resources and provide competitive parity are also known as rare resources. Even, the competitive parity is not desired position, but the company should not lose its valuable resources, even they are common. COSTLY TO IMITATE : the resources are costly to imitate, if other organizations cannot imitate it. However, imitation is done in two ways. One is duplicating that is direct imitation and the other one is substituting that is indirect imitation. Any firm who has valuable and rare resources, and these resources are costly to imitate, have achieved their competitive advantage. However, resources should also be perfectly non sustainable. The reasons that resource imitation is costly are historical conditions, casual ambiguity and social complexity. ORGANIZED TO CAPTURE VALUE : resources, itself, cannot provide advantages to organization until it is organized and exploit to do so. A firm (like Taj Hotel Group) must organize its management systems, processes, policies and strategies to fully utilize the resource’s potential to be valuable, rare and costly to imitate.
STEP 8: Generating Alternatives For Taj Hotel Group Case Solution:
After completing the analyses of the company, its opportunities and threats, it is important to generate a solution of the problem and the alternatives a company can apply in order to solve its problems. To generate the alternative of problem, following things must to be kept in mind:
- Realistic solution should be identified that can be operated in the company, with all its constraints and opportunities.
- as the problem and its solution cannot occur at the same time, it should be described as mutually exclusive
- it is not possible for a company to not to take any action, therefore, the alternative of doing nothing is not viable.
- Student should provide more than one decent solution. Providing two undesirable alternatives to make the other one attractive is not acceptable.
Once the alternatives have been generated, student should evaluate the options and select the appropriate and viable solution for the company.
STEP 9: Selection Of Alternatives For Taj Hotel Group Case Solution:
It is very important to select the alternatives and then evaluate the best one as the company have limited choices and constraints. Therefore to select the best alternative, there are many factors that is needed to be kept in mind. The criteria’s on which business decisions are to be selected areas under:
- Improve profitability
- Increase sales, market shares, return on investments
- Customer satisfaction
- Brand image
- Corporate mission, vision and strategy
- Resources and capabilities
Alternatives should be measures that which alternative will perform better than other one and the valid reasons. In addition, alternatives should be related to the problem statements and issues described in the case study.
STEP 10: Evaluation Of Alternatives For Taj Hotel Group Case Solution:
If the selected alternative is fulfilling the above criteria, the decision should be taken straightforwardly. Best alternative should be selected must be the best when evaluating it on the decision criteria. Another method used to evaluate the alternatives are the list of pros and cons of each alternative and one who has more pros than cons and can be workable under organizational constraints.
STEP 11: Recommendations For Taj Hotel Group Case Study (Solution):
There should be only one recommendation to enhance the company’s operations and its growth or solving its problems. The decision that is being taken should be justified and viable for solving the problems.
Case Study Solutions
Taj Hotel Group
Subjects Covered Human resource management Leadership Organizational behavior
by Thomas J. DeLong, Vineeta Vijayaraghavan
Source: Harvard Business School
11 pages. Publication Date: Jul 23, 2002. Prod. #: 403004-PDF-ENG
Taj Hotel Group Harvard Case Study Solution and HBR and HBS Case Analysis
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IMAGES
VIDEO
COMMENTS
From the Magazine (December 2011) Summary. Reprint: R1112J When terrorists attacked the Indian city of Mumbai in 2008, employees of the Taj Mumbai hotel displayed uncommon valor. They placed...
Faculty News | Economic Times (Bombay) | 27 Jan 2011 Response by Taj employees to 26/11 a case study at Harvard Re: Rohit Deshpande The multimedia case study 'Terror at the Taj Bombay: Customer-Centric Leadership' by HBS professor Rohit Deshpande documents "the bravery and resourcefulness shown by rank-and-file employees" during the attack.
Abstract Rakesh Sarna, MD and CEO of the Indian Hotels Company ltd (IHCL) was faced with the challenge of leading and embedding changes in IHCL to turnaround its trajectory.
Abstract The Taj Hotels, Palaces, and Resorts introduced a new brand architecture to counter lack of differentiation and confused positioning of its mixed bag of brands. After launching an economy and an upscale brand, it dithered over the launch of its upper upscale and luxury brands.
R.K. Krishna Kumar, managing director and head of Taj Hotel Group, has to decide whether to reexamine a promotion decision. In an attempt to deliver a level of service quality that met global standards at the Indian hotel chain, Kumar had introduced new personnel management systems at the company. As a result, a committee was now responsible ...
by Julia Hanna. Under terrorist attack, employees of the Taj Mahal Palace and Tower bravely stayed at their posts to help guests. A look at the hotel's customer-centered culture and value system. On November 26, 2008, 175 people died in Mumbai, India, when 10 terrorists simultaneously struck sites. Of the five locations—all well-known ...
One of the locations attacked was the Taj Mahal Palace and Tower, which was occupied by the terrorists for over three days, resulting in the deaths of 34 people and 28 people injured. ... Harvard Business School Multimedia/Video Case 511-703, March 2011. Educators; ... Harvard Business School
A dozen Taj employees died trying to save the lives of the hotel guests during the attacks. "Not even the senior managers could explain the behaviour of these employees," Deshpande is quoted as saying in HBS Working Knowledge, a forum on the faculty's research and ideas.
MUMBAI: The Taj Hotel is honoured to be part of a Harvard Business School case study following the inclusion of the heroic response of its employees during the 26/11 terror attacks here, a hotel spokesperson said in a statement.
On November 26, 2008, heavily armed terrorists launched a series of attacks throughout the western-Indian city of Mumbai (formerly Bombay). One of the locations attacked was the Taj Mahal Palace and Tower, which was occupied by the terrorists for over three days, resulting in the deaths of 34 people and 28 people injured. However, the Taj received praise in the aftermath of the attacks for the ...
Harvard Business School Taj hotel Mumbai attacks Indian Hotels Company Ltd. Taj employees (Catch all the Business News , Breaking News Events and Latest News Updates on The Economic Times .) Download The Economic Times News App to get Daily Market Updates & Live Business News.
BOSTON: The heroic response by employees of Mumbai's landmark Taj Hotel during the 26/11 terror attacks is now a case study at Harvard Business School that focuses on the staff's selfless service for its customers and how they went beyond their call of duty to save lives.
The heroic response by employees of Mumbais landmark Taj Hotel during the 26/11 terror attacks is now a case study at Harvard Business School that focuses on the ...
By: Garima Sharma, David G Hyatt. This case explores issues faced by the corporate sustainability manager at the corporate headquarters of a large hotel group in a developing nation as she implements her company's corporate…. Length: 12 page (s) Publication Date: Oct 18, 2013. Discipline: Organizational Behavior.
The study mainly focusses on "why did the Taj employees stay at their posts (during the attacks), jeopardising their safety in order to save hotel guests" and how can that level of loyalty and dedication be replicated elsewhere. A dozen Taj employees died trying to save the lives of the hotel guests during the attacks.
Taj Hotel Group Harvard Case Solution & Analysis Home >> Management Case Studies >> Taj Hotel Group RK Krishna Kumar, managing director and head of Taj Hotel, has to decide whether to revise the promotion decisions.
Case Companion is an engaging and interactive introduction to case study analysis that is ideal for undergraduates or any student new to learning with cases. Learn More Explore Different Types of Cases
Taj Hotel Group Harvard Case Studies Taj Hotel Group Case Study Solution & Analysis In most courses studied at Harvard Business schools, students are provided with a case study. Major HBR cases concerns on a whole industry, a whole organization or some part of organization; profitable or non-profitable organizations.
Taj Hotel Group case study solution, Taj Hotel Group case study analysis, Subjects Covered Human resource management Leadership Organizational behavior by Thomas J. DeLong, Vineeta Vijayaraghavan Source: Harvard Business School ... Source: Harvard Business School. 11 pages. Publication Date: Jul 23, 2002. Prod. #: 403004-PDF-ENG.
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Business friendly. See properties with amenities to help you work comfortably, like WiFi and breakfast. ... The majority of room reservations are refundable if you cancel prior to the hotel's cancellation deadline, which is often 24 or 48 hours before your check-in date. If you have a non-refundable reservation, you might still have the option ...
The Izmailovo Hotel is a four-building hotel located in the Izmaylovo District of Moscow, Russia. It is the largest hotel in Europe , and was the largest hotel in the world from 1980 to 1993. [1] Built for the 1980 Summer Olympics to accommodate sportsmen and visitors, the hotel remains popular among Russians and foreign guests.
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