Center for Hospitality Research

Hospitality Leadership Through Learning
Center for Hospitality Research

Root Causes of Hotel Opening Delays in Greater China


Vol 14 No 10
By: Gert Noordzy MBA, CAPM and Richard Whitfield Ph.D.

Executive Summary:

China’s massive program of hotel construction has opened hundreds of properties with thousands of rooms—an unprecedented accomplishment that is projected to continue for the next two decades. The available development pipeline data indicate that at least three 150-plus-room hotels will be opened in China every day for the next 25 years. Because such a rate of hotel growth has never been seen before, the methods used to open these hotels must be focused and methodical. Given that many of these planned hotel openings have encountered delays, this report analyzes the nature and causes of these delays. Interviews of 81 professionals working at 15 hotel chains were assessed using Causal Chain Analysis. This process revealed a large set of proximate causes for those delays, including last-minute design changes, delays in appointing a contractor, and failure to acquire necessary permits. Deeper analysis of these causes revealed that a lack of understanding and adaptation of project management concepts and techniques were the root causes of these issues. As a consequence, this report recommends that major hotel management companies need to strengthen their project management capabilities if they hope to meet their ambitious China growth targets.

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