Nuevo Hotel Budgeting Control Essay Example | Topics and Well Written Essays - 1250 words

Nuevo Hotel Budgeting Control - Essay ExampleFor its counseling Nuevo adopted the commonplace Comodo team-structure, consisting of the General Manager with a five-member advisory Board of Directors and ten independent business unit (IBU) managers. This organisational arrangement was intended to generate a flexible and entrepreneurial spirit, so promoting creativity and risk taking while still ensuring sound responsibility and accountability. It was also intended to emphasise empowerment, teamwork and knowledge-sharing - enabling all management and cater to use their initiatives and do what they have been trained to do in order to provide an outstanding standard of service. Nancy Foster, an experienced and highly respected GM in the Comodo root word was appointed as GM of Nuevo, to be assisted by a management team, some of whose members had been experienced in and imbued with the management culture of Comodo, while the others, experienced in hospitality business shared Comodos mis sion of making it the best business and leisure hotel company in the world, through their energetic, committed and responsible work., which always exceeded their guests expectations.Nancy was truly experienced as a GM, but this was her original experience of opening a new property. She thought it obligatory for her to make Nuevo the standard-bearer for Comodo Groups UK and European operations in the quick evolving information/virtual age. To achieve this she thought it wise and prudent to involve the entire management team in developing key control systems for the hotel. She was well aware, of course, that management control system was a two-edged sword in that while it could influence employee behaviour to achieve the companys goals, it could also lead to large losses and possibly even to organisational adversity. The team had already completed the management system in almost all areas of hotel management except in the important area of management accounting controls, including establishing the hotels first budget. In the management team meeting held to chalk out this problem, what emerged was the implications of the benefits and drawbacks of the traditional budgeting procedures for designing an effective budget control system for Nuevo. Traditional Budget Control governanceTraditionally management teams of Comodo hotels usually based their first few annual income budgets on the feasibility study projections carried out to inform the decision to invest in the project. This helps the Home force to get an early view of how the hotel is doing compared with the project appraisal. But then, these would be outdated in that they were drawn up days ago, and in the case of Nuevo, three years ago. Nancy wanted the first year budget proposal handed down to them by the Home Office to be revised because since the time of the project hatch two other hotels had come up in Manchester and competition had become hot. However, Nuevos Finance director advised Nancy to go long with the Home Office because everyone would be busy in