Table of Contents INTRODUCTION...........................................................................................................................3 AC1.1: Analyse the nature of hospitality product and service areas......................................3 AC1.2: Evaluate the different influences affecting patterns of demand within hospitality operations...............................................................................................................................4 AC1.3: Compare customer profiles and their differing expectations and requirements in respect of hospitality provision..............................................................................................5 AC1.4: Analyse factors affecting average spending power (ASP) in hospitality businesses.5 AC2.1: Evaluate the key stages in product and service development applied within a hospitality operation...............................................................................................................6 AC2.2 Analyse the features which contribute towards the customers’ perception of products and services............................................................................................................................7 AC2.3 Assess the opportunities and constraints affecting product and/or service development within a hospitality environment............................................................................................7 AC2.4: Evaluate different merchandising opportunities for hospitality products and services..8 AC3.1Evaluatedifferentmethodsofpricingtakingintoaccountadditionalpricing considerations.........................................................................................................................9 AC3.2: Assess the factors which affect revenue generation and profitability in hospitality operations...............................................................................................................................9 AC4.1 Apply a range of performance measures and appraisal techniques to individual aspects of hospitality operations, the product and the whole operation............................................10 AC4.2 Determine the usefulness and limitations of the various quantitative and qualitative appraisal techniques and their application to hospitality operations....................................11 AC4.3Applyapproachestobusinessanalysis,evaluationandplanningappropriateto hospitality operations, making proposals for action.............................................................11 CONCLUSION..............................................................................................................................12 REFERENCES................................................................................................................................1
INTRODUCTION Hospitalityoperations management is a process of developing business skills to work in an organisation within various areas in hospitality industry.In hotel industry, operations management includes areas like management of human resources, front desk operations, food andbeveragesandhousekeeping(Alexakis,2011).Thepresentassignmentisbasedon Grosvenor House hotel which is a part of JW Marriott chain, located in Mayfair are of London, England. It is a luxury hotel opened in 1929 providing flawless service. In this report, nature of services offered by hotel and the factors that influence their demand have been discussed. Also, it links variouscustomer profiles and their expectations to the services offered. The report includes the key stages involved and opportunities and constraints during provision of services. Along with that, the pricing and planning strategies adopted by the organisation are covered. TASK 1 AC1.1: Analyse the nature of hospitality product and service areas Hospitality industryis an essential element of part of the service industry. It emphasizes upon satisfaction of customers and meeting the preferences and desires of customers (Kimes, 2011). In hotel industry, services like accommodation, room service, food and beverages, conference and banqueting, entertainment etc. are included. The manager of Grosvenor House also focus upon such areas which are described below:-ï‚·Tangible-These are those products that can be seen and touched by people. For e.g. Rooms: Its the responsibility of management of Grosvenor House to ensure that the visitors have a comfortable stay. Proper cleaning of rooms is done before arrival of guests. Also, the rooms provided are spacious, air-conditioned and properly ventilated.ï‚·Intangible-Those services that can not be seen but only felt. For e.g. Conference and Banqueting: It is essential that the hotel has the facility of conferencing and banqueting hall to host any business conference or special events (Lashley, 2012). ï‚·Perishable-For e.g. Food and Beverages. The top management ensures that the food available in hotel is cooked by adopting proper hygiene and quality measures. Menu includes variety of dishes so as to suit customer preferences.
AC1.2:Evaluatethedifferentinfluencesaffectingpatternsofdemandwithinhospitality operations The operations of a hospitality organisation are influenced by various factors as it is the most essential element of service industry. In relation to hotel industry, these factors may include preferences of customers, trends in market, seasonality and economic conditions of the country. Some of the factors considered by the management of Grosvenor House are:-ï‚·Seasonality:This is one of the most influential factor that drives the business of hotels. Peak seasons allow more customers to move in to experience luxurious comfort and memorable experience.ï‚·Time of day/week:It is yet another driving factor for hotel industry. Visitors move in more during weekends or festive seasons. Also, there is high movement of visitors during the day time, thus the hotel management need to keep these factors in mind to ensure quality service for guests (Sigala, 2013).ï‚·Living Style:The hotel management aims at providing flawless service, lavish lifestyle and finest of amenities to meet the standards of its brand image in market.ï‚·Regional and ethnic influences:The regional and ethnic preferences of visitors also impact the business in hotel industry. ï‚·Economic factors:The economic conditions of a country also affect the demand in hotel industry as high disposable income of customers imply more use of luxurious services. On the other hand, low disposable income of visitors means unwillingness of customers to spend money on premium services. AC1.3: Compare customer profiles and their differing expectations and requirements in respect of hospitality provision. The amount of money a particular person can spent is based upon the income group which he belongs. There are three type of income group i.e. moderate, high, elite. It is the set of particular population which is divided with respect to the level of income (Sunder, 2013). An individual who comes in the moderate income group is ablestay over the places where he can getbasic facilities and the rooms forfulfilling therestandard lifestyle, there expectations regarding the meal and price are not much higheronly they just need tosatisfy there essential needs like food water and electricity. They only need a comfortable location, healthy and friendly environment .
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While the person who belongs the high income group needs all the basic facility, plus some additional luxury of food items and the location which they prefer are more close to the natureandpeacefulplaces.TheGrosvenorhotelalsoprovidesthefacilitiesofseparate bathrooms and swimming pools in their area separately and they are ready to pay any amount which gives value to their money (Tsang, 2011). The person who comes in the elite income group, do not worry about spending the money. They just need those facilities which are only for the elite class of people in The Grosvenor Hotel gives premium bathroom, separate gym area, special beverage section, 24 hours dining facility, private chef and butler services. The expectations of this type of customer always new at different places and they are able to pay any price for the specific services of the hotel. AC1.4: Analyse factors affecting average spending power (ASP) in hospitality businesses. There are various factors which affect the average spending power of customers which are explained below:- Size of income-If the Income of people arehigh then there spending power are also good, which gives them benefit to spend larger amount of money in the accommodation . While those people who have low income can also spent money but at the decent rate which could be afforded by them (Vlachos and Bogdanovic, 2013). Social and cultural influences-Low income group generally follows the culture of saving money as they need money for the future securities and plan while the high income group follows the culture of spending more as they have no shortage of money ,have enough saving already for the future plans so, Grosvenor hotel offers and address cultural diversity for giving benefit to both lower and higher income group by giving them different choices and preferences regarding the rooms and facility of hotels. As part of the current trends of hotel industry, it provide all basic and some premium facility to high income group, while discount on the room is provided by company to lower income group. Also, for higher income group extra facilities are also available as their spending power are much higher. Economic situation- The economic background of an individual also make influence on the average spending power of a person. The individuals whose economic background is sound, their spending power for luxurious accommodation is also effective. If the inflation and interest rates is higher, then individual will not be able to spend more (Alexakis, 2011).
AC2.1: Evaluate the key stages in product and service development applied within a hospitality operation. In context of Grosvenor House, organisation is developing an idea of luxury and premium pick and drop service to the customer in order to build brand image of the hotel to counter the competition. The product idea comprises of pick and drop service from the airport, service for places visits and other purpose. In concern with Grosvenor, there are various stages which has been followed for the purpose of analysis and implementation of the given product idea are as follow: Idea generation-This stage involves the generation of new product and services idea with the set strategic objectives and addition in the current portfolio of products or services of the hospitality sector.In context with Grosvenor House, idea of premium pick and drop service is good and suitable idea. Idea screening-It is a quick analysis and evaluation of an idea which is made against any set criteria and take care of the objectives with the development of new product or services. Screening of pick and drop for Grosvenor house needs proper formulation and implementation. Concept development and testing-This stage tells about the initial requirement of setting an idea of new product and services development andan analysis to forward well structured and defined product idea to research and development idea for the further process.In context with Grosvenor house, testing and simulation for given idea is important and significant to pursue. Business analysis-This stage tells about the brief analysis of the idea generated and a know how it will benefit to the organisation. It also disclose how this idea is good for locate or situate into the market and its suitability in context with customer. There should be complete analysis of given business idea in order to implement before open it for the customer. Product development-This stage actually belongs to the part ofR&D department. The personnel gives it the shape of actual product and add new key features and characteristic such as colour, shape, size and design etc. (Bartram and Dowling, 2013). In Grosvenor House, it is important and necessary to implement strategies to initiate the development of the actual products out of the given idea. Test marketing-It involves the commercial testing of a product to judge the actual potential and abilities of a new product after the production stage to the qualified customers.For
the purpose of test, it is required to arrange the resources for the idea of deluxe and premium pick and drop services for the customers. Commercialisation-This phase comes before the launch stage of the product. It decides the strategy of when, where, how and by whom new product and services will be launched and initially at what price and targeting which market of the customer's. Launch-This is the final and last stage of this whole process. It includes commercial launch of the product in the potential market. It is an kind of event where the physical launch of any products or specific as such in the hospitality sector services take place. After all ads, promotion and communication, now the actual product is ready to deliver to customer. After this process, it is concluded that, this product idea is sufficient for building the brand image of the Grosvenor House and best suitable idea for adding value and growth for the hotel. AC2.2 Analyse the features which contribute towards the customers’ perception of products and services. There are various features that shapes the perception of customers regarding the services in hotel industry which are considered by the top management of Grosvenor House explained below:-Price of the product or service-In the Grosvenor House, pricing of a particular product or service decides the changes in the mind of the consumer and their quick perception about the hotel sector (Bharwani and Butt, 2012). If the price is too high, it presumes that they can get same or high benefits at the lower price. This shows that price is one of the most important factor of the consumer perception.Service quality-Quality of services in the Grosvenor House Hotel should be more than the expectation of the customer and be specific, quick and impressive. Brand image-Continuous generation and building the brand image is the most common factor of the perception process. Serving the customer utmost best, providing the best quality and their ethics and values creates the positive image of the particular hotel to the customer. This can also lead to mouth publicity of hotel by customers in front of their acquaintances (Causin and Ayoun, 2011).
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There are numerous other factors such as dietary requirements, disabled access, style of service delivery and quality, standardisation, use of space etc. that frame their minds toward the service provider. AC2.3 Assess the opportunities and constraints affecting product and/or service development within a hospitality environment. There are a number of factors that impact the growth and development of any business or industry with respect to market scenario. With reference to Grosvenor House, being a part of JW Marriott Hotel, it offers lavish services and comfortable lifestyle for the guests so as to maintain its brand image in market. They providea memorable experience to customers by offering flawless service and premium services. The staff of hotel is courteous, jovial and passionate to deliver high quality services to visitors (Crawford, 2013). The management of hotel aims at satisfaction of customers by delivering amenities that are beyond the guests’ expectations. Exceptionallydistinguishinglavishenvironmentwithvarietyofcuisineskeepingin consideration the health conscious people makes this hotel one amongst the best in UK. Detailed attention to every facility offered by the hotel and handling of queries of guests as and when they arise, has given a competitive advantage to the business. It is well known that various responsibilities are associated with luxury hotels. These responsibilities if not handled well can act as constraints for the business. Some of the constraints in hotels are change in inflation rates, customer preferences, technological advancements. These factors if not tackled by the management of Grosvenor House can hamper their revenues and brand image. AC2.4: Evaluate different merchandising opportunities for hospitality products and services. Merchandising refers to display of products in such a manner that it arouses the interest of customers and entices them to purchase that good (Ferdinand and Kitchin, 2012). This includes ascertaining the quantities, deciding the prices of goods and services, using attracting display designs and techniques, developing promotional strategies and analysing the need of discounts and rebates. In hotel industry, the process refers to understanding the preferences of customers and then delivering services in a way that influence visitors to raise demand for hotel. In context of Grosvenor House, there are various opportunities available for the top management to increase its brand name and stake in market.
Nowadays, with various new trends in technology, hotel has given the chance to buyers to book the rooms via internet through hotel site, mobile applications while they are in their homes, there is no need to visit the property. Also, by establishing healthy communication with visitors while they are in property, they can influence the behaviour of guests in such a way that targets at customer loyalty for the hotel in future. Also, hotel can offer special discounts or rebates if the visitors book directly instead of through a third party service provider. Thus, the organisation builds an understanding of the needs of customers, ensures their ease in booking of rooms and delivers lavish services while the guests are in property. By this, top management of Grosvenor House aims at improvising their brand image in hotel industry and also open routes for acceptance by customers at the time of expansion of hotel across different locations (Kimes, 2011). TASK 2 AC3.1(a)Evaluatedifferentmethodsofpricingtakingintoaccountadditionalpricing considerations Pricingis the process through which an entity sets selling price for its products and services.Therearevariousmethodsofpricingavailabletomanagersinhotelindustry. Grosvenor House also recognises the importance of these methods and thus follow some methods which are explained below:-ï‚·Cost oriented pricing:Cost-based pricing refers to a pricing method in which a certain percentage of desired profit is added to cost of product to obtain the selling price. Management of Grosvenor House uses this technique as the entity runs for the motive of profit making along with delivery of finest services to maintain its stake in market.ï‚·Market oriented pricing:Every organisation conducts operations in a manner that keeps in consideration the pricing strategies being adopted in the industry by rival organisations (Hospitality and Operation Management,2018).Grosvenor House doesn't follow this pricing technique.ï‚·Service charge:The management of Grosvenor House aims at providing premium services to its guests even beyond their expectations. So, top management charges prices according to the quality of services delivered.
ï‚·Cover charge:The hotel management does not just focus on delivering luxurious room services but also makes provisions for entertainment of its visitors by organising various cultural or music events. Grosvenor House doesn't apply this technique of pricing. ï‚·Minimum charge:This pricing technique is used by Grosvenor House to stay ahead of its competitors in industry. This method refers to offering the services to customers at some minimum prices when compared to their rival hotels. AC3.1 (b)Which of these methods is not applicable in selected organisation and justification Some of the above methods are not followed by Grosvenor House for deciding its pricing, the explanation behind which is specified below:-ï‚·Market oriented pricing:Top management of Grosvenor doesn't believe in deciding the prices of its services considering the selling prices charged by competitors as they believe a large base of customers relate high prices with exceptional quality. Thus, company does not increase or decrease prices as per rival hotels. ï‚·Cover charge:Company does not apply this pricing strategy as it believes that providing a good ambiance and entertainment services is the responsibility of every hotel manager, thus it doesn't charge any price for the same. AC3.2: Assess the factors which affect revenue generation and profitability in hospitality operations Grosvenor House Hotel provides elite class services and thus for ensuring its long term existence in market, it is necessary thatmanagement ensures that the sale made is able to meet cost of provision of service. There are various factors that are considered by them to make sure that revenue is being generated for business with an element of profit. These factors are explained below:-ï‚·Labour Intensity:To conduct the daily operations in Grosvenor Hotel, managers need to maintain a skilled staff which is courteous and jovial in communicating with guests and deliver services that match the standards of hotel (Ferdinand and Kitchin, 2012). Thus, every year, hotel has to spend a lot of money on giving training to its staff. Thus, efficient delivery of services will generate revenue for the entity and also increase profitability of business.
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ï‚·Elasticity of Demand:The demand for services in hotel industry also impact the revenue and profitability of business. If the demand is high, it will result in generation of revenue and increase the chances of profit making for Grosvenor House and vice-versa.ï‚·Price:The pricing of rooms decided by management of Grosvenor House has very vital role to play in the generation of revenue. High pricing would result in lower revenue generation for the entity and vice-versa.ï‚·Procurement:There are a number of products and services offered at the hotel which are procured by hotels from market (Crawford, 2013). The cost of procurement of these services also affect the profitability of business for Grosvenor. ï‚·Average Spending power:The spending power of a customer also affects the sales and profitability of Grosvenor Hotel. A customer who is willing to spend a large sum of money to ensure that he/she receives premium services in response will result in generation of high revenue and profits for entity. TASK 3 AC4.1 Apply a range of performance measures and appraisal techniques to individual aspects of hospitality operations, the product and the whole operation Performance measurement is the process of determining how well an individual or organisationis operating to achieve the desired gaols. This includes quantification of inputs, outputs, processes, services and performance to assess whether the pre-decided targets are met or not (Causin and Ayoun, 2011). Appraisal techniques are the methods adopted by an organisation to evaluate the performance of an employee. Quality Management is imperative to assess whether the quality of services delivered are up to the standards set by hotel management. The utmost goal of the entity is customer satisfaction. It is important to determine whether the staff is delivering services as per requirements of visitors. External comparison is carried out by enterprises which means comparing the services provided by the entity with those of rival business organisation is necessary to ascertain whether operations of business entity are aligned with industry. The overall performance of an organisation is analysed to ascertain whether the extent of revenue generation is aligned with the profitability goal of company. Management of Grosvenor House Hotel also use various such techniques to evaluate the performance of staff against the standards. These techniques are Quality management and
Customer satisfaction as these techniques provide an understanding of the requirements and preferences of customers to theorganisation. With the help of this information, Grosvenor can develop and update services to keep in track with customer choices. AC4.2 Determine the usefulness and limitations of the various quantitative and qualitative appraisal techniques and their application to hospitality operations Quantitative appraisal techniques are the ones that are determined by comparing inputs and outputs of employees. On the other hand, qualitative techniques refer to appraisal on the basis of behavioural pattern of workforce. Grosvenor Houseuse various quantitative and qualitative techniques to track productivity of their staff. These can be used to reward employees and work units and to give promotions. Also, these can aid managers in termination or discipline of poorly performing workers. But these techniques have some adverse effects also like sense of insecurity among those who don't get promotions or salary raises. Also, it makes them feel alienated from the group of personnels (Bharwani and Butt, 2012). AC4.3 Apply approaches to business analysis, evaluation and planning appropriate to hospitality operations Business analysisis the process of ascertaining businessneeds and developing solutions tobusinessproblems (Bartram and Dowling, 2013). Business evaluation meansevaluating performance of operations of an entity. Business planning refers to the process of determining business goals and making plans that aims at accomplishment of those goals. In context of Grosvenor House, managers carry out business analysis by gaining an understanding of the needs of entities and customers. With the help of business evaluation, management of Grosvenor monitor whether entity is providing services as per the brand positioning of the hotel in market. develop processes and methods for delivering excellent quality of services. Also, it applies business planning in accordance with the hindrances that may arise in their future operations. Training of staff is done to ensure that the queries of guests are handled as soon as they arise. This results in accomplishment of organisational goals of revenue generation and profit making. CONCLUSION From the above report, it is concluded that the provision of services in a hospitality industry need to be well planned. It is also analysed that pricing strategy in hospitality organisationshouldbeadoptedafterconsideringtheinternalandexternalfactorsofan
enterprise. Also, it has been observed that there are various stages involved in effective delivery of services which should be planned well in advance so that any hindrance that may arise during the process can be properly handled. Along with that, it is important for managers to train the staff effectively to ensure delivery of high quality services to visitors.
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REFERENCES Books and Journals Alexakis, G., 2011. Transcendental leadership: The progressive hospitality leader's silver bullet. International Journal of Hospitality Management.30(3). pp.708-713. Bartram,T.andDowling,P.J.,2013.Aninternationalperspectiveonhumanresource management and performance in the health care sector: Toward a research agenda. Bharwani, S. and Butt, N., 2012. Challenges for the global hospitality industry: an HR perspective.Worldwide Hospitality and Tourism Themes. 4(2). pp.150-162. Causin, G. F. and Ayoun, B., 2011. Packing for the trip: A model of competencies for successful expatriate hospitality assignment.International Journal of Hospitality Management. 30(4). pp.795-802. Crawford, A., 2013. Hospitality operators' understanding of service: a qualitative approach. International Journal of Contemporary Hospitality Management. 25(1), pp.65-81. Ferdinand, N. and Kitchin, P., 2012.Events management: an international approach. Sage. Kimes, S. E., 2011. The future of distribution management in the restaurant industry. Journal of Revenue and Pricing Management. 10(2). pp.189-194. Lashley, C., 2012.Empowerment: HR strategies for service excellence. Routledge. Sigala, M., 2013. A framework for designing and implementing effective online coupons in tourism and hospitality.Journal of Vacation Marketing. 19(2), pp.165-180. Sunder, M. V., 2013. Synergies of lean six sigma.IUP Journal of Operations Management. 12(1). p.21. Tsang, N. K., 2011. Dimensions of Chinese culture values in relation to service provision in hospitality and tourism industry.International Journal of Hospitality Management.30(3). pp.670-679. Vlachos, I. and Bogdanovic, A., 2013. Lean thinking in the European hotel industry.Tourism Management.36. pp.354-363. Online HospitalityandOperationManagement.2018.[Online].Available through:<https://www.emeraldinsight.com/doi/abs/10.1108/09596119610152069>. 1