Club Med: Case Overview

CLUB MED: CASE OVERVIEW

Club Mediterranee was founded in 1950, by a group of friends, as a non profit sports association. After 11 years of business and with more than 100 resort villages, the company was already in the top ten of the largest hotel companies in the world.

In 1972, the company expanded overseas, creating a filiate known as Club Med - villages in the American Zone which comprised 17 different resorts. During its first years, Club Med was associated to a “wild and crazy” image which largely affected its reputation and consequently caused expansion’s difficulties.

Moreover, there were misunderstanding due to cultural and language differences between European GOs and North Americans GMs. Village chiefs and chiefs of service, both high positions, were disproportionately more performed by Europeans which caused continuing problems.

Additionally, there were issues with some policies that seek for the centralization of all GOs into four personnel departments in Paris. This was incompatible with the rapid growth of American workers which led to the formation of a fifth zone, “GO Village”, this time in American territory.

Regarding Club Med’s organization, it worked in quite simple way. There was a chief of village that had overall responsibility over the resort operations and other seven chiefs of service that should report to the superior one. Each one of this chiefs was in charge of a specific area and had to leader several GOs. Other “non-organizational” activities, as cleaning, were performed by local workers.

MAIN PROBLEM

Jacky Amzallag, director of Human Resources, is worried with the disproportionately high rate of turnover among Club Med’s employees. Despite company’s efforts, there are current unsolved problems regarding employment and workers retention, more specifically when looking at the newly recruited GOs.

Club Med’s turnover rate had already reached values above 50% and continued growing year after year. Even though the company had not yet find a plausible cause to explain such high rate, it became evident that it was related with a lack of efficiency in processes as recruitment, selection, training or even talent development.

ANALYSING AVAILABLE OPTIONS: IDEAS TO IMPROVE THE SYSTEM

In order to continue growing in the American zone and maintain Club Med’s reputation and recognition as a successful company, it is mandatory to address the major issue Club Med is facing: turnover. Thus, Jacky proposed some options and improvements to the system, related more specifically to the human resources field, which are described and discussed below:

Getting chiefs more involved in recruiting processes

Jacky was worried about the fact that some village chiefs fired two or three