Case Study #4

The rubric provides additional information and requirements for the assignment. Please make sure that you use both the assignment description file AND the rubric when completing your work.
Write a 2 page briefing paper in which you present a summary
of your research about the topic and your recommendations as to what should be
included in a briefing to the new members of the Padgett-Beale Board of
Directors. Be choosy about what you include – busy executives do not have the
time to read lengthy, rambling papers. Don’t be too choosy however. Your
recommended content should be comprehensive and fully address the briefing
topic.
Some background info on this assignment: this is a role-playing class. Padgett-Beale is a fictional company. When addressing new members of the Padgett-Beale Board of Directors, it should be written in the persona (character) of an employee working Padgett-Beale to said members.Please read the corporate profile first, then the instructions, followed by the rubric.
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Welcome!
Welcome to Padgett-Beale! We are excited to have you join us as a
management intern and hope that your participation in our virtual / online
program will be beneficial for both you and our company. This year, our
management interns will have the opportunity to participate in PadgettBeale’s pervasive cybersecurity initiative. This initiative is designed to help
our employees and managers better understand and address the cybersecurity
problems that our company is facing. These problems include a host of
privacy related concerns, intellectual property protection issues, and the
appropriate use of information technology resources. Since you are joining us
as a management intern, you will also be participating in our internal training
program: Cybersecurity for Leaders and Managers. During this eight- week
program, you will have an opportunity to participate in a number of
management and leadership activities and assessments related to
cybersecurity.
As you move through this program, we hope that you and your peers will
take advantage of the numerous communication channels made available to
you via our internal Websites and discussion forums. We are truly interested
in learning from you and hearing your thoughts on the management and
leadership issues that you encounter during your time with us.
Finally, our goal is to help you find opportunities to take what you learn here
and apply it to your future studies and career. We hope that you, in turn, will
help us by providing feedback during and at the end of this program. Thank
you for your participation and, again, Welcome!
Sincerely,
Edwina L. Beale
Edwina L. Beale Chief of Staff and Manager, Internship Programs
Padgett-Beale Organization Chart — 2017
Figure 1. Padgett-Beale, Inc. Organization Chart
Company History
Elmer and Robenia Padgett’s first hotel, Robenia’s Guest House, opened in
1925 with six family suites (two per floor), a tea room, and a formal dining
room. The guest house primarily served wealthy families who relocated to
the seashore for the summer to escape the heat in New York City. This
property provided amenities and services matching those of rival long- stay
hotels in major cities along the East Coast. The second and third properties,
Padgett’s Hotel and Padgett’s Beach House, were acquired in 1935.
Flintom’s Tavern, a landmark restaurant and entertainment venue, was added
to the Padgett properties portfolio in 1940.
Periodic resurgences in popularity of the seashore as a vacation destination
occurred over the next fifty years (1940-1990) as bridges were built, roads
were improved, and regional economies strengthened. These resurgences
brought additional competition as new motels and resorts operated by
national chains entered the seashore vacations market. Major weather events
in the 1970’s resulted in damage to both Padgett’s Beach House and
Flintom’s Tavern causing both to close for an extended period of renovations.
The Padgett family’s brand remained strong, despite these setbacks, as
members of the family took a personal interest in the day-to-day operations
and management of the company.
Padgett’s was not an early adopter of computers and information technology.
But, over time and as younger family members entered the business,
computers began a slow march into the company’s offices in the form of
personal computers with word processing, spreadsheets, and database
systems. Personal computers also made their way into manager’s offices in
the hotel properties where spreadsheets proved valuable in tracking revenues
and expenses. In 1982, an embezzlement scandal at Flintom’s Tavern forced
the company to adopt computer-based point of sale (POS) systems
throughout the company for all cash handling functions (hotel front desks and
restaurants). A benefit of the POS systems were the built-in reporting
functions, which enabled the company to more closely track cash and credit
sales by property. By 1995, the company had fully integrated custom hotel
management software into its operations. This software and the associated
databases were hosted on company owned / operated mainframe computer
systems. By the end of the decade, information technologies were in use to
support all aspects of the company’s internal operations (accounting,
customer service, property management, and reservations).
At the beginning of the new century, the company adopted its first strategic
plan with a heavy emphasis upon growth and expansion. Under this plan, the
company branched out and began offering hotel and resort management
services to other hoteliers and property owners. Advanced telephony services
and implementation of custom software allowed Padgett’s to offer one of the
first centralized reservations management services. The company also
leveraged the Internet and World Wide Web to launch a resort affiliates
program, which provided a menu of business related services to member
properties. These services included: online advertising and promotions,
architecture and design assistance, business operations consulting, group
business insurance, and guest loyalty programs. The hotel and resort
management services business area continues to be the major source of
revenues and profits for the company and its owners.
As part of Padgett’s expansion plan, the company purchased Beale Realty
Holdings in 2001 and formed Padgett-Beale, Inc. (PBI). Shortly thereafter,
PBI embarked on a series of real- estate acquisition activities, which led to
the purchase of several large tracts of prime Eastern Shore waterfront
property. The company’s long-term plan was to hold the properties as real
estate investments and, when market demand rose sufficiently, expand into
development, sales, and management of condominiums and vacation timeshare properties. The focus on long term investment was a wise choice as this
particular market segment was adversely impacted by the housing boom/bust
in the mid 2000’s.
At the time of purchase, the waterfront properties were in use as
campgrounds and resorts for tent-campers, travel-trailers, and motorhomes.
These camping facilities were allowed to continue their existing operations
with minimal investment and oversight for the next 15 years (2002 – 2017).
During this laissez-faire management period, some campground managers
modernized their camp offices and stores by purchasing computer-based
point of sale systems that allowed them to accept credit and debit cards. Most
of these managers also outsourced their reservations management to a third
party online reservations system, which provided a customized website to
advertise each park and provide access to the online reservations system. A
few campgrounds did not modernize beyond setting up a simple website with
contact information and a few photographs. These facilities continue to use a
mail or telephone-based reservation process with a “cash only” payment
policy.
In 2015, the day-to-day operations and management of PBI was transitioned
to a new leadership team recruited from leading hotel and resort management
companies. The new leadership team includes the Chief Executive Officer,
Chief Financial Officer, Chief Operating Officer / Director for Resort
Operations, and the Corporate Counsel (attorney) who is also dual-hatted as
the Chief Privacy Officer. Under this new leadership, the company was
reorganized to better focus on the three most profitable business areas: Resort
Operations, Reservations Services, and Resort Affiliates. Management and
daily operations for the three company owned hotel properties (Robenia’s
Guest House, Padgett’s Hotel, and Padgett’s Beach House), Flintom’s
Tavern, and the campgrounds / trailer parks were transferred to the newly
formed Property Holdings and Development division.
Building a strong management and leadership team is a priority for both the
new CEO and the current chair of the PBI Board of Directors. In 2017, these
two leaders developed and launched a management internship program
whose participants were recruited from a select group of colleges and
universities. The next class of management interns has just started in program
and will soon find out where their first assignment will take them within the
company.
Industry Overview
Padgett-Beale, Inc. (PBI) operates in the Hotels, Motels, & Resorts industry
(NAICS Codes 721110 and SIC Codes 7011) (First Research, 2017a). Hotels,
motels, and resorts provide short-term housing and lodging for travelers and
visitors. Related services offered by companies in this industry include:
catering and meals, conferences and event hosting, entertainment, resort
amenities (golf, swimming, spa, etc.), etc. The company also operates in the
Recreational Vehicle Parks industry (NAICS Codes 721211; SIC Codes
7033) as both an owner/operator and as a management and operations partner
providing specialty services to member and affiliate RV parks.
Hotels, Motels, and Resorts
Leading firms in this industry include Marriott International, Inc., Hilton
Worldwide Holdings, Inc., and Starwood Hotels & Resorts Worldwide, LLC
(First Research, 2017a). On an annual basis, this global industry generates
over $500 billion in revenue. The U.S. segment of this industry generates
approximately $175 billion in revenues each year. These revenues may be
generated directly from operation and management of company owned
properties. Or, revenues may be generated through franchising arrangements
or through fees generated in conjunction with property management / hotel
operations services provided to other property owners.
Demand for products and services in this industry is driven by two primary
factors: (a) business travel and (b) vacation or tourist travel (First Research,
2017a). Both of these factors are highly sensitive to the health of regional,
national, and global economies. Financial analysts estimate that 75% of
industry revenues result from fees for overnight lodging. The remaining 25%
of revenues result from sales of related products and services (e.g. meals,
beverages, etc.). Labor is the most significant source of expenses.
This industry uses information technology and the Internet in a variety of
ways. First, most brands use the Internet and social media to support their
marketing efforts. Second, all but the smallest of properties / brands use
information technologies and the Internet to support reservation call center
operations. Third, information technologies are used in the daily operations
of facilities (front and back of house) and in support of corporate business
processes and functions. These technologies include Point of Sale systems for
handling customer financial transactions, housekeeping and maintenance
management systems, card key access systems for guest rooms and restricted
areas, scheduling and timekeeping systems for personnel, and building /
facilities management systems that control and monitor energy using systems
such as lighting and heating/ventilation/cooling (HVAC) systems.
Information technologies are also used to provide physical security in such
forms as video surveillance and recording, access controls for equipment and
control zones (key pads, badge readers, password controlled logins), and
automated access logs which record identity information along with
timestamped entry/exit for controlled zones.
Recreational Vehicle Parks
Leading firms in this industry include Thousand Trails (owned by Equity
LifeStyle Properties), and Kampgrounds of America (KOA) (First Research,
2017b). Each of these companies has a slightly different business model.
Thousand Trails is an owner/operator for RV Parks (First Research, 2017b).
KOA sells franchises to owner/operators of privately owned RV Parks and
provides brand related services such as marketing, park design and
management consulting, and reservations management. A third company,
Good Sam Enterprises, markets and sells RV travel related services to
individual travelers (“members”) and provides marketing and sales support to
member parks (Good Sam Club, 2017). All three firms provide online
guidebooks (some with reviews, inspection reports, and ratings), which
include information about individual parks and their amenities. In addition to
these three firms, there are thousands of smaller owner/operators of RV parks
in the United States. These RV parks range in size from 10 – 100 acres with a
capacity of 150 to 2,000 or more RV, tent, and rental cabin sites.
Demand for products and services in this industry is driven by vacation or
tourist travel (First Research, 2017). Sales and revenues are highly seasonal
as preferred destinations change with the weather and with the usual and
customary vacation periods (summer, holidays, school breaks, etc.). Rental
fees for overnight stays are the largest source of revenues for individual RV
Parks. Additional revenue sources include: camp store and gift shop
operations, restaurants and snack bars, fuel sales (propane), and sales of RV
parts and accessories. Major areas of expenses are: utilities (water, electric,
sewer, cable TV, and Internet service), park maintenance (including roads
and buildings), vehicles, property taxes, and operating expenses for amenities
such as laundry facilities, bath houses, swimming pools, playgrounds, etc.
Insurance coverage for park operations is also a major area of expense and
may include additional coverage for cybersecurity liability (Philadelphia
Consolidated Holding Company, 2017).
This industry uses information technology and the Internet in a variety of
ways. First, many RV parks maintain a Website to advertise the park (First
Research, 2017b). They may also use social media to attract visitors to their
Website and to the RV park. They may also depend upon Websites operated
by third parties such as RV Park Reviews, Trip Advisor, and Good Sam Club
to attract the attention of individuals who are planning trips or vacations.
Second, all but the smallest of properties use an online reservation
management system that allows travelers to search for available sites by
date(s) and by required or desired amenities (electric, water, sewer, cable, pet
friendly, etc.). Larger operators and networks of parks may also use a
telephone call centers for reservations management. These call centers
depend upon computer applications to route and manage calls. Reservation
management systems also depend upon databases and database servers to
store and process customer information. Third, information technologies are
used in the daily operations of some facilities. Such uses include guest checkin/check-out, cash and credit card transaction management (payments &
refunds), maintenance records, camp store / gift-shop inventory and sales,
and bookkeeping / reporting (revenue tracking). Some RV parks also use
computer-based systems for video and audio surveillance, automated vehicle
entry/exit, and energy usage monitoring.
Case Study #4: Accountability Gap
Scenario
You’re in your final weeks at Padgett-Beale as a management intern. Hopefully, this has been
an enriching and rewarding experience for you. Before you finish out your time here, the Chief of Staff
has asked you to prepare one last briefing paper – this time your audience will be three new members
of the corporation’s Board of Directors (BoD). These busy executives need to be brought up to speed on
their responsibilities with respect to cybersecurity.
The Chief of Staff has provided you with a list of readings that have been reviewed and found
acceptable for use in preparing this briefing (the readings appear under Research in this file). The new
members of the board will each receive a read-ahead package containing these readings.
As you work your way through the CoS’s reading list, you should take notes and familiarize
yourself with the roles and responsibilities of a member of the Board of Directors. You should also
review the Accountability Gap research report and the findings from that research. From these
resources and others that you find on your own, you’ll need to identify and then discuss at least five
security and privacy related issues that the board members need to be aware of. These should include
cybersecurity related responsibilities for BoD members as enacted in federal and state laws and/or
published in government or industry regulations. (Hint: look for terms such as fiduciary duty, liability,
due diligence, etc.)
See the instructions below for additional information about length, formatting, and citing of
sources.
Research
1. Review the Week 7 and 8 readings. You should pay special attention to the reading on the
Accountability Gap (see https://conferences.law.stanford.edu/cyberday/wpcontent/uploads/sites/10/2016/10/3c1_The-Accountability-Gap-Report-%e2%80%93Cybersecurity-and-Building-a-Culture-of-Responsibility-1.pdf )
2. Research the roles and responsibilities of Boards of Directors in general and with respect to
cybersecurity. Here are some resources to help you get started:
a. https://www.extension.iastate.edu/agdm/wholefarm/html/c5-71.html
b. https://www.gsb.stanford.edu/sites/gsb/files/publication-pdf/cgri-quick-guide-03board-directors-duties-liabilities.pdf
c. https://www2.deloitte.com/content/dam/Deloitte/za/Documents/governance-riskcompliance/ZA_DutiesOfDirectors2013_16042014.pdf
d. https://securityintelligence.com/nacd-publishes-five-cybersecurity-principles-everyboard-director-needs-to-know/
e. https://www.infosecurity-magazine.com/opinions/corporate-board-responsibility/
f. https://corpgov.law.harvard.edu/2017/04/28/cybersecurity-trends-for-boards-ofdirectors/
g. https://corpgov.law.harvard.edu/2017/05/30/cybersecurity-must-be-high-on-theboard-agenda/
3. As you read the above readings, identify five or more ways that members of the BoD can
become more informed about the company’s current cybersecurity posture (a key step in
closing the “accountability gap.”) These will become your recommendations in your briefing
paper.
4. Find at least one additional source that provides information that a member of the board of
directors needs to know about his or her cybersecurity responsibilities.
Write
Write a 2 page briefing paper in which you present a summary of your research about the topic and your
recommendations as to what should be included in a briefing to the new members of the Padgett-Beale
Board of Directors. Be choosy about what you include – busy executives do not have the time to read
lengthy, rambling papers. Don’t be too choosy however. Your recommended content should be
comprehensive and fully address the briefing topic.
At a minimum, your briefing paper for this case study must include the following:
1. An introduction to the case scenario and the topic (use the information above)
2. A discussion of five or more key points about the topic (“cybersecurity and related
responsibilities of members of corporate Boards of Directors”)
3. Five or more recommendations for closing the accountability gap by making sure that
members of the BoD are educated about cybersecurity and informed about cybersecurity
issues as they arise in the future.
4. A closing section in which you restate the key issues and your recommendations.
As you write your briefing paper, make sure that you address security issues using standard terms and
definitions. See the resources listed under Week 1 and under Course Resources > Cybersecurity
Concepts for definitions and terminology.
Submit For Grading
Submit your research paper in MS Word format (.docx or .doc file) using the Case Study #1 Assignment
in your assignment folder. (Attach your file to the assignment entry.)
Additional Information
1. To save you time, a set of appropriate resources / reference materials has been included as part of
this assignment. You must incorporate at least three of these resources into your final deliverable.
You must also include one resource that you found on your own.

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