Brian Henesey
Case 2
I.Key Facts
a. Players
i. Main characters or companies: Hilton Hotels, Blackstone Group, Tom
Keltner(EVP+CEO Am.’s), Hilton International, Bala Subramanian(SVP), Tim
Harvey (EVP+CIO),
ii. Competitors: Wyndham Hotel Group, Choice Hotels International, Accor,
InterContinental Hotels Group, Marriott International, Carlson Hospitality
Worldwide, Starwood Hotels & Resorts Worldwide, Global Hyatt Corp.
iii. Partners: Blackstone Group?
b. Financial Performance: 32.05 share price, sold for 32% premium at $26 billion; OnQ
$93 million, $40 million for app dev and $53 million for hardware and infrastructure impl.;
2007 investment increase of another $102 million, $22 million for OnQ sale and events,
$40 million for globalizing OnQ, $40 million for purchase and development of new
hardware and infra.; total yearly budget of about $240 million. See Charts in Case for
specific data
c. Timeline of the Case: 1919- Mobley Hotel, Conrad Hilton; 1946- Public w/ name Hilton
Hotels Corporation; 1964- spinoff international unit; 2000- purchase of Promus Hotel
th
Corporation; 2005- Hilton International; 2006- 1,000 hotel; 2002- CRM;
II.Issues
a. Conflicts
i. Management- deployment of OnQ and CRM throughout the entire ecosystem of
Hilton Hotels. Avoiding complacency with CRM. Measuring ROI regarding CRM
ii. Legal- none
iii. Ethical- none
b. Central Problem
i. List main problems- A) Maintaining CRM B) CRM ROI? C) Use a standardized
approach or a targeted approach?
ii. Rank them- Same order A, B, C
iii. Select a primary problem (or the first problem to be addressed)Standardized or Targeted approach to the future of CRM.
III.Analysis (narrative)
a. Qualitative and/or quantitative analysis- Both. Qualitative analysis regarding the
improvement of ease of use in the CRM systems. Quantitative analysis regarding the ROI
of CRM, the problem being how to separate and read the data?
b. What are the causes?
i. Internal and external- Internal- not looking long term enough, only looking in the
next five years. There needs to a comprehensive strategy to overlay for the next
15 years or more and use a constant update to continue improvement where
needed. External- being able to stay ahead of the competition, and enticing
investors.
c. What are the rules and how do they apply?
d. Are there any gray areas? Yes, a lack of total data regarding the company’s quarterly
results or yearly results.
e. What is happening? Hilton Hotels bought by Blackstone Group. Hilton Hotels
implementing OnQ IT systems and keeping it updated. Attempting out figure out the ROI
on OnQ and CRM.
f. What do they want to have happen? (Gap Analysis) They want to calculate their ROI
on CRM and OnQ; also to figure out their future with OnQ.
g. What are others doing? Implementing their own systems similar to OnQ.
IV.Identify Alternatives
a. Pros/cons Pros- Instant results(OnQ), improves communication and knowledge. Conspotentially heavy costs and no real ROI calculation presented.
V.Conclusion and Recommendation (the “what”)
a. Can this solution apply in a larger way? (microcosm extended to macro level)
Brian Henesey
Case 2
VI.Action (the “how”) They need to continue to update and improve CRM and OnQ. It has proven a
reliable way to communicate across the company, while simultaneously improving customer
satisfaction. The CRM systems seems to be paying off, with consistent top customer satisfaction
awards.