Innovative Entrepreneurship – the Key Dna for a Successful Turnaround in the Hospitality Business

Topics: Innovation, Entrepreneurship, Hotel Pages: 13 (4061 words) Published: February 23, 2011
INNOVATIVE ENTREPRENEURSHIP –
THE KEY DNA FOR A SUCCESSFUL TURNAROUND

IN THE HOSPITALITY BUSINESS
With specific Reference to the Hospitality Sector - Small and Medium sized Hotels in Mumbai.

By

Dr. R. Gopal
B 4 Akshaya, Chedda Nagar, Chembur, Mumbai 400089. Director, D.Y.PATIL Institute of Management Studies, C.B.D. Belapur, Navi Mumbai. Tel. No. ® 022 –2528 6428, © 9322517368 E Mail: gopaldoctor@gmail.com; gopaldoctor@yahoo.co.in

And

Mr. Krishna Shetty
B – 206,Dosti Astor Dosti Acres Antop Hill, Wadala East Mumbai 400 037 Faculty, D.Y.PATIL Institute of Management Studies, Belapur, Navi Mumbai. Tel. No. ® 022 32510957, © 9819333633 E Mail: shettykrishna@gmail.com; shettykrishna@hotmail.com

INNOVATIVE ENTREPRENEURSHIP -- THE KEY DNA FOR A SUCCESSFUL TURNAROUND IN THE HOSPITALITY BUSINESS With specific Reference to the Hospitality Sector—Small and Medium sized Hotels in Mumbai. ABSTRACT: As the business environment is becoming increasingly more complex, accompanied by intensified competition, rapid advances in technology and most critically, rising churn, be it customer or employees, there is an unprecedented rise in corporate failures today. And, just as amazing as the increasing number of failures, is the fact that most of the companies that attempt a recovery, also fail. Against this backdrop, it makes sense for companies to understand the reasons for their decline, in their performances, and find ways to avoid a potential bankruptcy situation. However, sickness is not restricted to corporates only. The same factors that cause sickness in corporates are also reasons for sickness in small and medium sized businesses. However, the gravity of the factors may vary and it would be pertinent to say that the study of failure and turnaround for small and medium businesses should be separately undertaken as the rules of the game for the large corporate houses need not necessarily be the same for the small and medium sized entrepreneurs. The Hotel Business or the Restaurant business is one category, which deserves special interest. These category of hotels and restaurants are typically called as UDIPI HOTELS which primarily serve SOUTH INDIAN DISHES like Dosas, Idlis etc. Many have diversified into serving the NORTH INDIAN DISHES like Parathas etc. Surprisingly several such UDIPI hotels are not able to match the onslaught of the changing demands of the Indian Customers especially in terms of new dishes, Chinese and other oriental dishes etc. The net effect has been that some of them have fallen by the wayside – a sick company. The problem for these small and business enterprises gets compounded when one realizes that the SICA and BIFR (Sick Industries Act and Bureau of Financial Reconstruction) are not in a position to help these organizations. The restaurant business category contributes substantially to the GDP of the country. The issue is what are the reasons for sickness in this category and what is the role that the entrepreneur plays in the successful turnaround of ailing restaurants. Can Innovation play an important role in nurturing these units back to their original glory? This paper aims to study the various strategies that have been used by the hotel sector in order to turn themselves from a sick organization to one of the topmost organization in their field. The study was limited to the hotel industry in Mumbai due to cost and time constraints.

INNOVATIVE ENTREPRENEURSHIP -- THE KEY DNA FOR A SUCCESSFUL TURNAROUND IN THE HOSPITALITY BUSINESS With specific Reference to the Hospitality Sector—Small and Medium sized Hotels in Mumbai.

INTRODUCTION:
The Indian restaurant services sector is estimated to be worth Rs. 57,000 crore, out of which only Rs. 3,940 crore or 6.9 percent is accounted for by the organized sector. The vast unorganized segment mainly comprises street-side stalls/kiosks constituting the majority of consumer food-service units and is characterized by intense fragmentation and...

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