Part III: Proposal
The merger of Starwood Hotels and Morgans Hotel Group will have both its benefits and challenges. These two specific issues have been broken down into three areas; employees, customers, and investment. We will examine the benefits first, followed by the challenges we might foresee
With respect to benefits let’s first look at how the merger will affect the employees. With this merger there will be a strong and unambiguous signal to the employees that business will continues as usual. Employees of both companies will keep their corporate culture with minimal or no disrupt to their current business practices. Good will comes with Morgans Hotel Group and Starwood clearly sees and understands that value in their brand. Customers are generally comforted by the familiar, and it is important to Starwood that Morgans customer’s experience, nor fell any change with the company. But we also believe that there are synergistic benefits that will be offered and felt in a positive form. This deal should round out Starwood’s portfolio, adding a unique brand in the boutique market that will allow organic growth and adds value via synergies and opportunities for growth through cross selling.
Now let’s address the issues of challenges with respect to the same order. Employees may question that if there are no obvious or evident changes was the merger actually necessary. We don’t want employees of Morgans to feel as if they are just cogs in the wheel of a large organization. There might be some concern on part of Morgans employee as to how much control Starwood might impose on them. But if Starwood allows too much independence are opportunities for cross selling lost? If customers see no obvious changes may they too question the merger? If they feel that it was just a financial benefit for Starwood cross selling may be an annoyance to Morgans