JEC Project Profile: Marriott

How can structural legacies in successful organizations be optimized for franchising?

Many large corporations are an amalgam of structures developed over different times to meet different perceived challenges, each with its own guiding philosophy and political dynamics. Add franchising, and the dynamics become even more interesting. How, for example, does one mesh the sometimes conflicting demands of matrix organizations, multiple brands, regionalized business units and powerful franchisees?
     Marriott Lodging sought to become a "world class" franchise organization. With a trusted name and a number of hot lodging brands like Courtyard, Fairfield Inn and Residence Inn, in addition to their upscale Marriott brand, they had generated phenomenal growth, much of it from franchising. With this growth came new stresses and challenges to the company's systems and organizational dynamics. And many questions.
     How best to support this unprecedented growth in their franchise sector? How best to balance the needs of franchisees and company operations? How best to manage multiple, often competing, brands? How best to achieve Marriott's goals within the context of a multi-brand matrix structure with decentralized operations management? These were among the questions we were asked to explore in a franchise assessment study.
     Based on a review of Marriott's organization and interviews with numerous franchisees and corporate executives, our study outlined a strategy for Marriott's "next generation" franchise system. First was a conceptual framework for channeling their "world class" transformational efforts. Then came the core recommendations: an innovative two-stage organizational realignment for improved responsiveness to the franchise system, and a new decisionmaking model to guide Marriott's evolution from their traditional consensus style to a process better able to cope with rapid change.
     Other key recommendations focused on the development of franchisee councils for conflict prevention, guidelines for improving support service efficiency, and improvements in intra-organizational and franchisee communication.