A hotel’s rebirth
An MSc in Intenrational Business & Entrpreneurship graduate put his educational experience to use by developing a new strategy for a struggling family business.
Nils Leonhardt is an alumnus of the MSc International Business & Entrepreneurship programme. He graduated in 2009 and is currently serving as a Board Member for Leonhardt Holding GmbH
“I am working in our family-owned group of companies operating internationally within the private equity, automobile, mechanical engineering and hospitality industry. My focus is on marketing, market research, finance/controlling and strategy on both the business and corporate level. Project-based management consulting is a core element of my current job.”
Nils used the opportunity provided by the programme’s International Management Solutions project to focus on one particular aspect of the organisation - a former 5 star hotel in Germany - and helped to shape its rebirth into Guesthouse Wolfsbrunn.
“The task was to make a 100 year old castle in a scenic setting economically viable while facing a limited regional market. The question I asked was, ‘what should our business be?’”
Nils carried out a comprehensive analysis of the hotel, its internal functions and the market in which it was operating, the result was a new mission statement - ‘Offering the extraordinary experience to everyone’ - that represents the philosophy of the Wolfsbrunn owners, that the castle and its parkland should be available to anyone in search of a first class experience at a reasonable price. The vision became: ‘to establish the Guesthouse Wolfsbrunn as the primary destination for accommodation, events and gastronomy within the region’.
Nils found that the 5 star rating was actually a weakness of the hotel, cutting it off from potential markets. The hotel needed to shed its ‘high price’ image, without losing regular guests who might not find the old service and quality creditable within the new price point.
The organisation developed communications to create brand awareness, brand loyalty, and a positive brand association to the guesthouse. “We wanted the message to be perfect service, genuine familiarity, professionalism and reasonable prices.”
Once the new strategy was introduced, the Guesthouse’s internal structure was changed to support the organisation’s goals. The new strategy served as a starting point for redefining managerial jobs and structures.
“We focused on developing a knowledge organisation, uniting a culture of discipline with entrepreneurship. We wanted to develop a culture where employees are required to adhere to a consistent system, while giving them freedom and responsibility within the framework of that structure.”
The Guesthouse started with ten employees, which gradually grew within seven months in line with the progress of the business, which now employs 27 people.
“We are still looking for our optimum size, while maintaining a high degree of flexibility, which is key for operating in this sector.”
The core experience and skills of the loyal employees were retained, but fresh blood was added to help develop the business with new ideas.
“We constantly align our best people with our best opportunities. The old saying that ‘people are your most important asset’ proved to be wrong; only the right people are.”
Systematically and thoroughly scrutinising the question of ‘what should our business be?’ helped to transform and under-performing business into a profitable one. After two slow months due to the reorganisation activities, the business virtually exploded. Although after eight months of operations it is too early to declare victory, Nils is encouraged by the company’s progress.
“So far, the new strategy performs. Nonetheless, an organisation is never fixed, and there is a constant modification process. It is essential to have the ability and flexibility to adapt to an ever changing environment. We always have to ask ourselves whether our services, processes and markets are still viable and whether they still give value to our customers. Every business that fails to keep pace with the changing environment and does not focus on customer needs is at the mercy of the marketplace.”