Hospitality Operation Management Sample Assignment

Hospitality Operation
Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
AC 1.1 Nature of hospitality product and service areas..............................................................1
AC 1.2 Influences affecting demand patterns within hospitality operations..............................2
AC1.3Customer profiles and their differing expectations and requirements in respect of
hospitality provision....................................................................................................................3
AC 1.4 Factors affecting average spending power (ASP) in hospitality businesses. ................3
AC 2.1 key stages in product and service development applied within a hospitality operation.
.....................................................................................................................................................4
AC 2.2 Features which contribute towards the customers’ perception of products and services.
.....................................................................................................................................................5
AC 2.3 Opportunities and constraints affecting product and/or service development within a
hospitality environment. .............................................................................................................5
AC 2.4 Different merchandising opportunities for hospitality products and services................6
TASK 2............................................................................................................................................6
AC3.1 Different methods of pricing...........................................................................................6
AC3.2 Factors which affect revenue generation and profitability in hospitality operations. .....7
TASK 3............................................................................................................................................8
AC4.1 Range of performance measures and appraisal techniques to individual aspects of
hospitality operations, the product and the whole operation. .....................................................8
AC4.2 Usefulness and limitations of the various quantitative and qualitative appraisal
techniques and their application to hospitality operations. ........................................................9
AC4.3 Approaches to business analysis, evaluation and planning appropriate to hospitality
operations, making proposals for action. ..................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................10

INTRODUCTION
Hospitality Operation management refers to the area of management in hospitality
industry which is concerned with monitoring, controlling, designing and implementing the
process of production of goods and services in order to earn maximum profitability ratio. In this
assignment chosen organization is Hilton company which is one of the best American
multinational hospitality company. It was founded in 1919 by Conrad Hilton with its headquarter
in Virginia United States. This report explains about the nature of hospitality product and
services. In addition to this key stages in product and services development applied within
hospitality operation is also explained in this report. Moreover. Different methods of pricing and
additional pricing consideration are also explained in this file. Lastly different range of
performance appraisal techniques are also focused in this assignment. Lastly, approaches to
business is also mentioned in this project.
TASK 1
AC 1.1 Nature of hospitality product and service areas
Product refer to an item which is used for sale, it can be either service or an item. Each
products and services is made at a cost and sold at a price so as to earn maximum profit for an
organization. In case of Hilton hospitality industry there are several products and services which
are being rendered to the customers in order to increase the productivity and profitability of
business concern.(Chawla and Wiboonrat2013) Therefore each products and services supplied
by Hilton company varies in nature, it can be both tangible and intangible products and services
and they are explained below:
Perishable products and services: This types of products and services wont last for longer
period of time and nether cant be experience the same as again. When such services are rendered
by Hilton industry to the requesting service of customers after a time period such services
irreversibly vanishes as it is used by the service user.
Tangible/ In tangible products and services: Products and services rendered by Hilton industry
can be tangible as well as intangible in nature. Tangible services refers to ambience conditions,
interior and exterior design of hotel which are visible to the customers. Whereas intangible

services refers to such services which cannot be seen or touched like feedback of customers
toward their services rendered to them, empathy of customers and many more.
Inseparable services: This types of services refer to those services which are rendered to the
customers on the basis of their respective requirement and preferences. For example Hilton
industry render services to the customer as per their requirement like the customer demand is the
banquet hall mus be specially designed , then accordionist the industry render services to the
customers.
Overall it can be concluded that nature of product and services rendered by Hilton industry
matter a lot so as to earn maximum profitability ratio.
AC 1.2 Influences affecting demand patterns within hospitality operations.
The demand of the customer varies as per the changes that is taking place in their needs
and preferences of products and services. Specially in Hilton industry demand of the customers
varies seasonally, time of day/weeks, changes in cultural region etc. There are certain factors
which are influencing the demand pattern of Hilton industry are as follows(Cope 2015):
 Time of week/days: There is high demand for booking in Hilton hotel industry during
the weekends specially for the couples.
 Seasonality: It refers to the fluctuation taking places correspond to the changes in season
and is the second most important factor which is influencing the demand pattern of Hilton
industry. This is because regular customers of Hilton industry most prefer to visit during
summer season as during this season they love to go for camping in hilly areas. So
during summer season demand pattern of Hilton industry moves upward.
 Economic factor: This factor refer to the changes that is taking place in the income level,
inflation rate, culture factor and life style of people. All this factor plays an important role
while affecting the demand pattern of the Hilton industry. Like when the income level of
Hilton industry customers goes down then the demand pattern of the industry also slows
down.
 Healthy leaving: This factors also highly affect the demand pattern of Hilton industry as
the customer of the Hilton industry prefer healthy foods and beverages. So when the
industry render products and services to the customers as per their preferences then the
demand pattern of the industry moves upward.

AC1.3Customer profiles and their differing expectations and requirements in respect of
hospitality provision
On the basis of customer expectation and requirements Hilton industry profile varies. So
its the prime responsibility of the manager of Hilton industry to take into consideration
preferences of the customers while delivering services and products to the customers. Customer
profile and their differing expectation and requirements in Hilton industry is explained below:
 Pricing consideration: The customer of Hilton industry does not take into consideration
the cost and the charges they are charging, in-fact they takes into consideration the type
of service the industry render to them. All this lead to increase in the price level of all the
type of services Hilton industry render.
 Meal experience: As in Hilton industry different customers are there who prefer health
and quality services as they are basically from sport steam and business men. So the
industry high quality meal services as per the demand and preferences of the customers.
 Expectation requirements: As the customer preferences and expectation keeps on
changing on the basis of surrounding, culture, needs and taste. So the Hilton industry
supply services to the customers keeping in mind their needs and demand. Thus, it helps
in increasing the productivity and profitability ratio of Hilton industry.
Overall it can be concluded that in order to increase the maximum profit of an
organization, Hilton industry must make a proper analysis and research about the changes taking
place in the customers profile, needs and preferences as well as about the changes taking place in
the competitors strategies. Thus, it will help the company to attract large number of customers
and to earn maximum growth in the market place .
AC 1.4 Factors affecting average spending power (ASP) in hospitality businesses.
Spending power refer to the ability of the individual to spend money after paying of
taxes. Thus,there are many factors which affect the average spending power of the customers in
Hilton industry and some of the factors are explained below(Crookall 2014):
 Status: This is the first most factor which affect the average spending power of
customers in Hilton industry. Status of people differ like for middle class people Average
spending power is not up to the level Hilton industry charges, As Hilton industry cost is
high for the services they render to the customers.

 Economic situation: Good spending power of the customer of Hilton company increases
the average spending power to spend in Hilton organization so as to take and enjoy the
services of the industry.
 Size of income: If the come level of the customers of Hilton industry decreases then their
average spending power for the industry also decreases. Whereas if the income level
increases then average spending power will also increase.
 Social and cultural influences: Some of the customers of Hilton organization like to
spend during festivals, so during festival average spending power of the customers
increases in order to spend in Hilton industry so as to get quality service from them.
AC 2.1 key stages in product and service development applied within a hospitality operation.
In case of innovating new plan regarding development of new product and services then
in that case there are certain stages which the Hilton organization follows and they are explained
below(Walczak, 2016):
 Idea generation: The manager of the Hilton company must first generate the ideas in
order to launch new product in the market
 Idea screening: During stage manger of Hilton organization must analyse and screen the
ideas so as to select the best idea in order to result better output for an organization.
 Testing and development of concept: In order to realize the ability and growth manager
of Hilton company test the concept during the third stage of new product development
process.
 Business analysis: In order to analyse the average time in each stage the manger of the
Hilton company uses metrics to monitor progress.
 Product development: In this stage each department of Hilton company starts
performing their operational activities in order to develop product like finance department
render funds so as to start production process and so on.
 Commercialization: During this stage manager of Hilton company finally render
products and services to the customers in order to earn maximum sales revenue for an
organization.
Overall it can be said that all the above steps are necessary to be followed in order to develop
new product in the market so as to increase the productivity and profitability of an organization.

AC 2.2 Features which contribute towards the customers’ perception of products and services.
The final decision of purchase depend upon customer perception, so its the prime
responsibility of the manger of Hilton company to analyse the changes that are taking place in
the perception of customers regarding the products and services. Some of the features which
makes a great contribution towards the customers perception of products and services are
explained below(Eisenberg 2007):
 Brand image of the products and services rendered by the Hilton organization creates
the positive image in the perception of the customers.
 Secondly good quality of and nutritious products render by Hilton organization also
attract and influence large number of customers so as to take and enjoy the services of
Hilton company.
 Thirdly, Hilton industry render cost effective services to its customers which helps in
attracting more number of customers toward their industry and it holds positive
perception towards the image of the industry in the mind of customers.
In addition to this other important factors like style of services, availability of resources,
standardization and space utilisation of Hilton industry also plays a major role in generation
perception of products and services in the mind of customers of organization.
AC 2.3 Opportunities and constraints affecting product and/or service development within a
hospitality environment.
Opportunities refers to those situation which can helps in the overall development of an
organization, whereas constraints Are those which create hurdles in the path of achieving
successful growth in the market. There are certain opportunities and threats which affects in the
development of products and services within the Hilton industry and they are as follows(Enz, C.A.
2010):
 Instead of rendering services only to couple, Hilton company can also enhance it revenue
by rendering opportunities of services to families, friends and to each category of people.
 By rendering healthy foods the Hilton company can attract many more new customers, this
is also one of the opportunities to earn maximum profit.
 One of the constraints for Hilton industry is that it doesn't render enough of accommodation
facilities to their customers because of which customers prefer to visit the competitors of
Hilton company who render enough of accommodation to their customers.

Thus, over all it can be concluded that Hilton industry must make an analysis regarding
opportunities which can helps in development of the organization. In addition to this company
should also analyze about the constraints that hinder the company so that they can be overcome on
time. Thus, it will help in increasing the overall productivity of an organization.
AC 2.4 Different merchandising opportunities for hospitality products and services.
Merchandising refer to variety of products which are available in order to sale in the
marketplace and the products are displayed in a manner so that the customers get influence with
it to make purchase. There are different merchandising opportunities for Hilton industry
products and services an some of them are explained below(Verma Ph D 2010):
 Many traveller travel to different nations specially for resectional and commercial
purpose which is also one of the merchandising opportunities for Hilton industry
products and survives.
 Secondly, good economics condition of the traveller country also helps in rendering
merchandising opportunities for Hilton industry products and services.
 Hilton industry offer premium charge to its customers which is one of the merchandising
opportunity for Hilton industry as the customer expect quality of service on the basis of
purchasing power. Thus, it helps in attracting large number of customers toward their
products and services and helps in increasing profit of an organization.
TASK 2
AC3.1 Different methods of pricing
If the Hilton company wants to increase the profitability ratio then its the responsibility
of manager of Hilton company to attract more number of customers towards there products and
services by setting affordable prices for their services. There are different methods of pricing
which are explained below(Faisal, A., Albrecht and Coetzee 2017):
HILTON INDUSTRY
Method Method used or not Remarks

Cost oriented
pricing method
No Under this method price of the products and services is
determined on the basis of the cost incurred during
production process by adding small amount of
percentage profit to it so as to determine selling price.
Market
oriented
pricing method
Yes Under this method manager of research and development
department of Hilton industry first make an analysis
regarding pricing strategies adopted by other rivalry
firm, so that accordingly to make up the pricing strategy
so as to attract more new customers.
AC3.2 Factors which affect revenue generation and profitability in hospitality operations.
Revenue generation and to earn profitability is the main aim of Hilton industry, there are
different types of revenue generating elements like average spending power of customers,
elasticity of demand, standardization and many more. Some of the factors affecting revenue
generation and profitability in hospitality operation of Hilton industry are explained
below(Kohila Ranjini 2015):
Appraisal of revenue generation and profitability in Hilton
industry
Factors to be considered Remarks
 Labour intensity  Amount of funds used
by the industry.
 Number of labour used.
This industry is said to be
labour intensive because the
industry make more use of
labour then capital.
 Shelf life  Level of initiative
taken by industry
management
 Customer satisfaction
 Value of brand image
 Industry can achieve
successful growth in
the marketplace by
rendering customer
satisfaction. This can
be done by offering
quality product ans

services to the
customers.
 Demand elasticity  Price of products and
service industry render.
 Demand of goods and
services.
Demand pattern of Hilton
industry is inelastic as changes
the price of services rendered
by industry does not affect
much on the customers
demand for their products and
services.
TASK 3
AC4.1 Range of performance measures and appraisal techniques to individual aspects of
hospitality operations, the product and the whole operation.
In order to evaluate the performance of individual the Hilton industry uses various
number of appraisal techniques. And after analyzing various techniques the manager should
evaluate the pros and cons of each techniques and accordingly should choose the best
techniques. Some of the techniques of performance appraisal are explained as under(Lafay
2006:
 Developing qualitative and quantitative data: In order to measure the performance
level of an organization it is very essential for the Hilton industry to determine
qualitative and quantitative data. Quantitative data include number of customers,
pricing strategies of the rival industry. Whereas qualitative data include customer
reliability, service quality offered and many more.
 Data analysis and evaluation: This is also one of the best method used by the Hilton
industry, through this method manager of the company makes an analysis about the
performance by comparing the actual one with the standard performance.
 Speed of delivery: It is one of the vital technique used by the manager of Hilton
company, through this technique manage measure how fast the order of the customers
are delivered. This is the best techniques as fast deliver create good perception in the
minds of the customers about the company image.

Thus, overall it can be concluded that the manager of the Hilton organization should
make proper analysis of the performance measurement of an organization by measuring the
standard with actual performance. Thus, it will helps in increasing the productivity and
profitability ration of the Hilton company.
AC4.2 Usefulness and limitations of the various quantitative and qualitative appraisal techniques
and their application to hospitality operations.
In some cases qualitative and quantitative appraisal techniques are basically run through
sample data, Which in some cases doesn't prove to be true while measuring the performance.
Like, quality of goods and services, attitudes of the workforce and many more aspects which are
considered while quantitative appraisal is done.(Mbasera, M.2018) So the manager of Hiton
company takes into consideration different techniques like questionnaire, interviews, by group
meetings all this can be used when the population is large enough. The main criticism of
qualitative appraisal method is that outcome which comes from the analysis cannot be used for
large number of population. For example; the products rendered by Hilton company is
delicious for majority of people, but it is not possible that for all the customers food taste is
delicious so it can be that to some cases such techniques of performance appraisal is not useful.
AC4.3 Approaches to business analysis, evaluation and planning appropriate to hospitality
operations, making proposals for action.
Business analysis , business plan and business evaluation are need to be done by the
manager of an Hilton company so as to accomplish organizational aims and objectives on
specified time period. Business plan refers to a state of document which gives the brief about
how the business concern usually the new business will achieve its goals and objectives.
Business analysis refer to the research discipline which helps in determining the needs and
solution to business problems. (Roy and Pyne 2011)Whereas business evaluation is define as
analysis and review of whole business so as to measure the productivity and profitability ratio of
the businesses. While applying different types of approaches to the Hilton industry it is difficult
to consider the approach for the different operational activity such as services rendered, catering
services, accommodation services rendered . For example, earlier in Hilton industry customers
were use to be treated by rendering only lodging facilities to them. However, in later, the
facilities rendered by Hilton were increased by adding some value added services like more of
accommodation facilities to the customers. Thus all this approaches to business analysis ,

evaluation and planning are appropriate for Hilton industry in order to generate and increase the
sales revenue.
CONCLUSION
From the above assignment it can be concluded that demand and preferences of the
customers in Hilton industry affect various factors like on quality ODF services rendered to the
customers. The manager of the company should set right and affordable price for the products
and services they are rendering so as to attract and influence large number of customers toward
their services. In addition to this manager should also make an research analysis regarding the
changes taking place in the taste and preferences of the customers so as to make strategies and
policies accordingly. Thus, it will helps in increasing productivity and profitability ratio of an
organization.
REFERENCES
Books and Journals
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and Continuing Education. 1985(28). pp.3-21.
Crookall, J.R.2014. Planning and Simulation of FMS. CIRP Annals-Manufacturing Technology.
34(2. pp.577-584.
Eisenberg, S., 2007. Using Risk Management as a Tool for Accident Prevention in the Resort
Golf Area. Hospitality Review. 25(1). p.9.
Enz, C.A. And et. al2010. Cases in innovative practices in hospitality and related services: Set 3.
Cornell Hospitality Report. 10(10). pp.1-30.
Faisal, A., Albrecht, J. and Coetzee, W., 2017. The challenges of (re) gaining a sustainable
business proposition post-disaster. CAUTHE 2017: Time For Big Ideas? Re-thinking The Field
For Tomorrow, p.489.
Kohila Ranjini, A., 2015. Determination of online reservation for hotel services (Doctoral
dissertation, Universiti Utara Malaysia).

Lafay, T., 2006. Systems and methods for managing alcoholic beverages. U.S. Patent
Application 10/909,427.
Mbasera, M.and et. al 2018. Determining the impact of green management policies on hotel
performance: A manager’s perspective.
Roy, S.K. and Pyne, P., 2011. Managerial Accounting in the Hospitality Industry—An
Overview. Management Accountant-New Delhi. 46(9). p.750.
Verma Ph D, R., Walsh Ph D, K. and Siguaw, D.B.A., 2010. Cases in Innovative Practices in
Hospitality and Related Services: Set 3.
Walczak, D., 2016. Food safety in restaurants: A human relations model. Hospitality
Review.19(1). p.3.