Asset Management in Hotel Industry

Running head: ASSET MANAGEMENT
Asset Management
Name of the Student:
Name of the University:
Author’s Note:

1ASSET MANAGEMENT
Introduction
According to Campbell, Jardine and McGlynn (2016) Asset Management is the method of
maintaining and effectively utilization of assets of the company. The primary role of assets in
hotel management is all about earning revenue and proper utilization of the assets. Where
tangible assets usually has a bigger impact on the working of the hotel industry, intangible assets
often plays crucial factors in determining the operations of the hotel. Certain intangible items are
like goodwill, patent, etc. Hotel industry is one of the dynamic income producer of assets. Every
asset has a life cycle from procurement to disposal the stages in the asset management cycle in
the hotel industry is important because of the cost and investments linked to it (Kahn and
Lemmon 2016).
Asset Management Cycle
According to Love et al. (2015), Hotels have a less complicated leasing structure as the
rooms are allocated on a per day basis, which includes rent for all utilities provided. The less
complicated leasing structure or the assets of the company should be utilized and manage
effectively by the hotel industry. Every assets of the company’s must be strategically used and
utilized by the hotels to generate positive returns. Efficient asset management is a process where
asset cycle plays a crucial role. Planning, acquisition, operation and scrapping an asset are some
of the asset management cycle (Council 2016).
Stages in Asset Management Cycle
According to Gordon, Sharp and Martin (2018) planning stage is the first stage in the
assets management cycle. Verification of the assets requirement is the planning stage. The asset
should be viewed from different management strategies and ways in which the asset requirement

2ASSET MANAGEMENT
can meet the daily-required services of the hotel industry. The hotel industry should carry
effective planning in the asset management cycle, as it will allow recognizing key assets and
underperforming assets of the hotels, availability of resources, maintenance of assets and
provisioning of assets. The second stage of the cycle comes the acquisition of the asset, which is
the further expansion of planning. The hotel should prepare budgetary analysis for the same the
cost to benefit analysis they will provide. The operations of the hotel industry is a key factor
assets should be able to render services which in turn will generate revenue for the hotel. The
operation and maintenance of the assets comes as the third stage of the asset management cycle.
Every asset of the hotel should be able to produce service or benefit it via directly or indirectly. It
is necessary to check the efficient and optimum utilization of these assets in the industry. Finally,
if the assets usage are for a prolonged period or has completed the lifecycle there comes the final
stage of the asset management cycle the disposal stage. Proper reallocation and replacement of
assets in the right place and at the right time will help the hotel industry compete better in terms
of service and products it caters (Michel and Martin 2018).
Asset Management Strategies
According to Gârleanu and Pedersen, (2015) Asset management strategies is applied in
order to enhance the efficiency in the operations of the company. Property management deals
with the critical assessment of public areas, food and beverages sections and the guest rooms.
Every asset of the hotel should be carefully analyzed whether the asset is able to render services
and deliver better output. Certain changes must be done periodically to include and align with
changing taste and preferences of the people like the food and beverages section and the guest
room. Hotel should move there focus from cost controlling techniques to revenue generation
strategies. Hotel should focus less on cutting there operational costs as these can hamper the