Hospitality Operations Management Assignment | Hilton

HOSPITALITY OPERATIONS
MANAGEMENT
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Nature of hospitality product and service areas.....................................................................3
1.2 Different influences affecting patterns of demand within hospitality operations..................4
1.3 Compare customer profiles and their differing expectations and requirements....................4
1.4 Analyze factors affecting average spending power (ASP) in hospitality businesses............5
AC2.1 Stages in product and service development applied within hospitality operation...........5
AC2.2 Features towards customers’ perception of products and services..................................6
AC2.3 Opportunities and constraints affecting product and service development .....................7
AC2.4 Different merchandising opportunities for hospitality products and services..................7
TASK 2............................................................................................................................................8
AC3.1 Different methods of pricing ...........................................................................................8
AC3.2 Factors affecting revenue generation and profitability in hospitality operations.............8
TASK 3............................................................................................................................................9
AC4.1 Performance measures and appraisal techniques of hospitality operations.....................9
AC4.2 Usefulness and limitations of various quantitative and qualitative appraisal techniques
and their application...................................................................................................................10
AC4.3 Approaches to business analysis, evaluation and planning ...........................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
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INTRODUCTION
Operations management is the most important component of the hospitality sector. It can
be considered as the pillars of the hotel industry (Mahadevan, 2015). In this regard, Hotel Hilton
will be taken into consideration to understand the various aspects of operations like division of
rooms, foods and beverages and many more. This assignment will describe about the nature with
different factors affecting the services, comparing customers’ profiles and key stages in the
product development. It will also include about the overall assessment of the hospitality
environment of Hotel Hilton in context of targeting audience and achieving profits and revenues
in effective manner.
Overview of Hotel Hilton: It is one of the finest groups of hotels and resorts that have been
operating at global level since 1919. This was founded by Conrad Hilton and is operational at all
the major locations of the world with more than five hundred properties and large workforce to
maintain its stark reputation (Conroy and Yemen, 2018).
TASK 1
1.1 Nature of hospitality product and service areas
Foods and Beverages have been considered here as one of the vital operations of Hotel
Hilton.
Perishable Element- It is definitely perishable and easily consumable. However, it is the
attractive entity to target the desired set of people.
Tangible/Intangible Element- This comes under both tangible and intangible as well. Foods and
beverages have a physical and concrete presence which can be touched, smell and feel in proper
mode(Manhas and Tukamushaba, 2015). Along with this, it has intangible traits as sometimes
the taste, look and overall presentation is indescribable and ethereal.
Inseparable Element- This put light on the quality assurance factor and involves empathetic
emotion with reliable validation leading to generate profits for this hotel.
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Service Areas- It consists of division of rooms for providing comfort and security to guests with
variety of foods and beverages with provision of banqueting hall to organise functions, events
and conference rooms to conduct formal meetings, seminars etc.
1.2 Different influences affecting patterns of demand within hospitality operations
Hotel business does get affected from many factors as the following. There are wide
pools of influential components that accelerate the businesses at Hotel Hilton to flourish such as
economic factor, season, festivals or vacation time, socio-cultural factors, ethnicity led elements,
Economic Factor helps the management of Hotel Hilton to plan any event or offers to attract the
customers by creating demand for their services. Along with, there are four seasons such as
summers, spring etc. that also has an impact on the demand of this hotel's services. Sometimes
any vacation or festivals also affect the demand (Bowie and et.al., 2016). Nevertheless, some
personal events like weddings, anniversaries, birthdays might also influence the demand patterns.
The social factor includes human's working patterns at both professional and personal levels
where people tend to go out and eat and during weekdays, until any occasion is there, they avoid
any outings. Lastly, the cultural component is another element to attract customers as hotel's
decor is important with food preferences on the basis of taste, flavors or regionalism to attract
potential customers’.
1.3 Compare customer profiles and their differing expectations and requirements
Hotel Hilton has wide exponential expectations from their customers’ outlook and
provides many services.
Spending Power- It is one of the oldest names and has a huge spending power as its operations
are expanded in more than 85 countries in almost all leading countries worldwide.
Type of Hospitality Business- It deals in mainly hotels and resorts with complete services. This
in terms of accommodation, entertainment, organizing, restaurants and more on full time basis.
Menu/Accommodation Range- It has a wider reach that has impressed its clients, guests in
profound fashion.
Pricing Considerations- This is for all types of customers like high end clients, travelers,
families, conducting meetings, seminars for larger or small companies.
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Expectations and Requirements- It’s a 99 years old group of hotels and resorts, clearly
demonstrating the desired expectations from customers’ viewpoints and has been sustaining the
competition so efficiently (Brown and Bessant, 2013).
Meal Experience- This hotel is known for its impeccable taste and variety of cuisines with the
suitability of the geographical location it is operating.
1.4 Analyze factors affecting average spending power (ASP) in hospitality businesses
ASP refers to a joint decision that is made between equal partners of hotel or restaurant in
pricing process.
Size of Income- This factor is directly proportional to the value of spending power of the
customers.
Status- It depends on the situational status of an individual in the eyes of the society or
community. This is mainly in context of the economic status and the ability to spend money to
enjoy services provided by Hilton’s management.
Social/Cultural Influences- It is directly connected with the influential power of customers in
their social circle which promotes celebration of any occasion/festival/event on large scale and
making them use the hotel’s services.
Economic Situation- It depends on the earnings capability of guests and clients of Hotel Hilton
(Gunasekaran and Ngai, 2012). Thus, they offer variable costing strategies to satisfy all their
expectations with respect to costing of their services.
AC2.1 Stages in product and service development applied within hospitality operation
Product and service development is an on-going process which includes a detailed plan to
identify, implement and analyze all the important stages required for the completion in
appropriate manner.
Idea Generation: It is the foremost step that laid the foundation for any development procedure to
meet expectations of Hilton’s investors, shareholders, customers and entire workforce.
Idea Screening: This leads to proper segregation of various components like deadlines,
budgeting, people requirements, materials needed and whatsoever.
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Concept Development and Testing: This is imperative to understand the implications attached
with that specific product or service development. It involves the implementation part after
testing it for couple of times to check its validation points and authentic results.
Business Analysis: This includes demand, pattern of customers’ needs and requirements, their
perspective towards alternations, current trends of marketplaces.
Product Development: This is long process but once it is finished, it reaps benefits in the best
possible manner including packaging, storage and reaching the shelves.
Test Marketing: This puts insights on the analysis and segmentation of product or service. It also
involves the customers’ preferences, their shareholders targets and owns goals that is totally
depended on profitability with enhanced productivity.
Commercialization and Launch: This is the last step yet not the confirmatory signal for the
success of that service or product (Mok, Sparks and Kadampully, 2013). However, the launch
must be done vigorously using marketing gimmicks and promotional tools to attract potential
audience.
AC2.2 Features towards customers’ perception of products and services
Hotel Hilton has occupied a sparkling positing in the marketplaces due to the following
features:
Brand Image- This can provide them a loyal customer base which will come again and revisit
their services.
Nutrition and Dietary Requirement- It includes the variety of cuisines with many healthy and
organic value with nutritive value that enhances Hilton’s slid image amongst its customers’.
Disabled Access- This has given extra wings to their expanding laurels list by giving special
attention to the specially challenged people and making them feel comfortable at their hotel.
Availability of Resources- Hotel Hilton’s supplementary services are also well established,
especially their small kits provided by the reception and making their customer to revisit.
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Style of Service- This includes the etiquette and friendly behavior of Hilton’s staff which time
and again push the forwarding button for customers to willingly access to their services (J.
Harrington and C. Ottenbacher,2011) .
Standardization and Space Utilization- This hotel is popular for its rich architecture and huge
lobby areas, providing ample space in all types of services including TV, mini-fridge, AC and
more.
AC2.3 Opportunities and constraints affecting product and service development
Product and service development is one of the integrated frameworks that put any hotel
globally. This can be done by grabbing opportunities and eliminating the obstacles in a confined
yet feasible manner. Additionally, Hotel Hilton has reputable name and thus do not need
promotion when launching of product or service. Along with, it attracts investors easily thus
leading to clutch the competitive advantages through its market positioning and by giving
services of top notch. On the other hand, this hotel does face any challenges such as medium
class families are still struggling to afford their services and they have limited options in
choosing room divisions. Moreover, they need wide spaces and thus are mostly situated in the
extreme points affecting the locals to visit and enjoy their services.
AC2.4 Different merchandising opportunities for hospitality products and services
Merchandising is defined as that activity which is needed for selling of goods and
services to customers by employing the retailing methodologies. The retailing sector and
hospitality industry goes hand in hand and has an influential impact on the customers’ mind.
Hotel Hilton’s merchandising ranges from laundry like linens, bedding, robes etc. to its visual
merchandising of hotel properties through information technological tools which has been
accelerated due to an upsurge rise of internet. Moreover, this section deals with the consumers’
PPP (Purchasing Power Parity) as their expenditure habits would assist in selling of Hilton’s
customized products and add value to their supplementary side businesses. Along with this, the
concept behind merchandising in hotel sector has impacted the other establishments dealing ij
the same sector like clothing, cosmetics and more. It has led to a spiraling effect and has resulted
in low usage of their products while visiting this hotel (Kessman and McCauley, 2011).
Additionally, it is one of the effective techniques used by the sales and marketing department of
Hotel Hilton that has impacted its profits and sales volume in leaps and bounds.
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TASK 2
AC3.1 Different methods of pricing
Hotel Hilton has been in this hospitality sector for more than nine decades now and with
advent of open economy and globalization, it has expanded its operations in almost all major
cities with proper arrangement of staff, personnel and employees to fulfill their loyal customers’
expectations in exponential growth. Along with this, they have always put exclusive
concentration on their pricing strategies as it has led to gain a momentum over their competitors.
They use the skimming tactic due to their seasonal demands and make them operate at prices
more than the usual. It has direct effects on their profitability. Whereas during off seasons, they
cut down their prices by applying various discounts, offers to accept the customers’ requests in
smart and appropriate order. Nonetheless, this seasonal demand also affects their handling of
operations and might result in lay-offs during low season and high hiring in times of any grand
event or arrangement of any event (Sisson and Adams, 2013). Another reason is flexible
approachability factor that determine the pricing strategies of this hotel’s administration. Their
regular customers’ get special pricing while new ones also fetch discounted offers to lure them to
come again and use their hotel’s services. Lastly, price discrimination is one of the latest fads
that have provided the subsidized hotels to offer their services and products at reasonable costing
to the locals when comparison has been done with the tourists in order to cover their proximity at
regional level with extension of global image by maximizing their revenues.
Cost based pricing – In this, prices are set according to cost of product or service. In this some
percentage of total cost of production is added to cost of product and then selling price is
determined (Zhang and Weatherford, 2016).
Demand based pricing- In this, price of product is based according to its demand in the market.
Competition based pricing- In this, prices are set according to competitor’s price of a product.
AC3.2 Factors affecting revenue generation and profitability in hospitality operations
The following elements have impact on the operations of Hotel Hilton in both positive
and negative aspects. The elasticity of demand plays important role in underplaying the patterns
of using the services of any hotel. When demand is low then profits or revenues also get affected
accordingly (The Influence of Customer Satisfaction towards Positive Word-of-Mouth in
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Hospitality Industry, 2016). Sales mix is another component that shed light on the brand image at
the global status and number of customers with their satisfaction level. This helps in increasing
the profits as well (Davis and et.al., 2018). Next is average spending power of customers on the
basis of services provided to them. Here, Hotel Hilton has been known for its royal look and
good maintenance of rooms division, conducting seminars, conferences etc, with special
emphasis on the food department (Mahadevan, 2015). The focus on detailed analysis and
planning of menu with international taste led to bring innovation in setting the standards among
their competition and profit generation.
TASK 3
AC4.1 Performance measures and appraisal techniques of hospitality operations
Performance Appraisal is refereed as the methodology in which the identification and
assessment of workforce of any organization occurs. It mainly deals with the performance
management of employees’ and gives rewards to them on the basis of the complete evaluation of
their skills, knowledge and etiquette in dealing with clients. Hotel Hilton does the same process
by considering the following elements:
BARS- In this, a scale a used to measure performance of employees. It includes factors like
employee behavior and their performance.
Management by objective – Here, performance is measured according to objectives that are
been set by managers (Altin and et.al., 2018). In this, each employee are given different goals
and objectives according to their skills and abilities.
360 degree feedback- Here, employee performance is measured by taking feedback from
superiors, colleagues, customers, etc. for this usually questionnaire is designed.
AC4.2 Usefulness and limitations of various quantitative and qualitative appraisal techniques and
their application
Usefulness: These techniques not only assist in motivating their employees to work better and
lead to an amiable and positive work environment. Overall, the productivity at workplace in
increased with a sense of responsibility and accomplishment to fulfill the objectives and goals of
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Hotel Hilton. Effective feedback and regular informal meetings or parties can give an
opportunity to connect with each other that later impact the work ethics and team bonding.
Nonetheless, employees’ behavior and treatment towards their colleagues and clients as well,
managing their roles with deadlines etc can be considered while assessing the qualitative aspects.
Along with this, such qualitative and quantitative techniques affect the entire progression in
multiple effects with high profits and low conflicts and challenges at workplace.
Limitations: Hospitality sector, especially large hotels like Hilton has loopholes too. Their
organizational structure is hierarchical which influence their upper management with great
powers and thus it can lead to partial and biased recommendations and appraisal. This can
hamper the entire workplace environment and has discouraging impact on employees’ working
practices. In addition to this, when the customers’ take undue advantages of their privileges and
harass or abuse the hotel’s staff then it also affect the records of that employees in mishandling
or giving unclear instructions to such clients. Such situations can promote distrust and ambiguity
in the minds of task force, resulting in lower levels of productivity and profitability.
AC4.3 Approaches to business analysis, evaluation and planning
Business analysis is defined as the practice of understanding the needs, specifications and
requirements in order to recommend the business owners regarding the analytics and logistics for
smooth running of operations at the organizational context.
Business evaluation is the procedure of set of rules and regulations that are used to measure the
financial part of an organization. This is the estimated value that the market is ready to pay or get
in return of proving service or selling of product.
Business planning is considered as the step by step guide for writing the documentation of a
business and has components like goals, approach abilities, techniques and more in order to
achieve the mission and goals of the organization.
With context of Hotel Hilton, it can be clearly understandable that these three
components have facilitated them in growing their businesses by expanding in many countries
and keeping their core values and regional ethnicities intact by incorporating the strategic
planning with adopted marketing procedures to optimize their resources allocation and enhanced
productivity to gain profits and increased generation of revenues. Along with, they are trying to
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bring creativity in their food, room services and lodging facilities through usage of diagatl tools
and use of internet for booking and promoting about their latest discounts and offers. Thus, it did
assist and support invariably to positive direction.
CONCLUSION
It has been summarized that Hotel Hilton has been in the global competitive market for
the right reasons. It not only provided the best services but also assist their staff and employees
with the best facilities that in return give the best to their clients and guest in effective and
efficient order.
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REFERENCES
Books and Journals
Altin, M. and et.al., 2018. Performance measurement and management research in the hospitality
and tourism industry. International Journal of Contemporary Hospitality Management.30(2).
pp.1172-1189.
Bowie, D. and et.al., 2016. Hospitality marketing. Routledge.
Brown, S. and Bessant, J., 2013. Strategic operations management. Routledge.
Conroy, R.M. and Yemen, G., 2018. Hilton: Tru to its Brand?.
Davis, B. and et.al., 2018. Food and beverage management. Routledge.
Gunasekaran, A. and Ngai, E.W., 2012. The future of operations management: an outlook and
analysis. International Journal of Production Economics. 135(2). pp.687-701.
J. Harrington, R. and C. Ottenbacher, M., 2011. Strategic management: An analysis of its
representation and focus in recent hospitality research. International Journal of
Contemporary Hospitality Management. 23(4). pp.439-462.
Mahadevan, B., 2015. Operations management: Theory and practice. Pearson Education India.
Mahadevan, B., 2015. Operations management: Theory and practice. Pearson Education India.
Manhas, P.S. and Tukamushaba, E.K., 2015. Understanding service experience and its impact on
brand image in hospitality sector. International Journal of Hospitality Management.45. pp.77-
87.
Mok, C., Sparks, B. and Kadampully, J., 2013. Service quality management in hospitality,
tourism, and leisure. Routledge.
Sisson, L.G. and Adams, A.R., 2013. Essential hospitality management competencies: The
importance of soft skills. Journal of Hospitality & Tourism Education. 25(3). pp.131-145.
Zhang, D. and Weatherford, L., 2016. Dynamic pricing for network revenue management: A
new approach and application in the hotel industry. INFORMS Journal on Computing.29(1).
pp.18-35.
Online
The Influence of Customer Satisfaction towards Positive Word-of-Mouth in Hospitality
Industry,2016. [Online]. Available through:< https://papers.ssrn.com/sol3/papers.cfm?
abstract_id=2713613>.
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