Operation Management in Hospitality

OPERATION
MANAGEMENT IN
HOSPITALITY

TABLES 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
2.4: Evaluate different merchandising opportunities for hospitality products and services............9
AC3.1 Evaluate different methods of pricing taking into account additional pricing
considerations. ..........................................................................................................................10
AC3.2Assess the factors which affect revenue generation and profitability in hospitality
operations. .................................................................................................................................10
AC4.2 Determine the usefulness and limitations of the various quantitative and qualitative
appraisal techniques and their application to hospitality operations. ......................................11
AC4.3 Apply approaches to business analysis, evaluation and planning appropriate to
hospitality operations, making proposals for action..................................................................12
Business analysis : It has a key role in recent businesses scenarios (Introduction to Business
Analysis, 2015). It is a practice of enabling change in organization by defining needs and
recommendation solution to the stakeholders. ..........................................................................12
CONCLUSION .............................................................................................................................12
REFERENCES .............................................................................................................................14

INTRODUCTION
A department have focus on creating and monitoring the procedure of manufacturing as
well as redesigning all the trading operations in the manufacturing of products and services is
termed as operation department Operations management plays a very important role in
hospitality industry. Marriott international is the multinational diversified hospitality company
that is being considered for completion of this project. An organisation has its headquartered in
Bethesda, Maryland. The report will provide the nature of hospitality product and service area.
Assignment will cover the factors influences the demand of the customer. The report will
provide the deeper insight of the factors affecting the demand of the hospitality along with the
various stages in the product and service development. Report will provide the features of the
customer view about products and services. Assignment will provide the opportunities and
constraints along with the merchandising opportunities for the product and services. Later, study
will cover the various performance appraisal methods for the product and services.
AC1.1: Analyse the nature of hospitality product and service field.
In the hospitality industry the product and services are the food and beverages which the
Marriott International provide to their customer. However, all the products and services have
various criteria, the nature of goods and services of the Marriott International are discussed
under.
Perishable: These goods are those goods which are easily deteriorate quickly when not stored
properly. The nature of the hospitality products is perishable, as they provide the products which
includes the foods and beverages which can be easily deteriorate with in one or two days.
Tangible and intangible elements: The nature of product and service which Marriott
International give to their customers are in tangible and intangible in nature. The tangible
services are internal and outside design of the hotel, the instruments and assets of the hotel and
the close state which is very much visual to their clients. While the intangible services include
the service factors are customer responsiveness, empathy, reliability, as well as assurance which
is not visible (Jauhari and Bharwani, 2017).
Service areas: Room division for customers, food and beverages services, conferences hall for
the meeting or the discussion, a banqueting system to help customers to arrange big feast like
lunch or dinner are main types of services provided by the Marriott International.

AC1.2: Evaluate the different influences affecting patterns of demand within hospitality
operations
The relationship between the guest and host, or the act or practice of being hospitable is
known as hospitality. There are various factors which affects the demand of the hospitality
which are discussed under-
Seasonality
Hospitality industry do not have demand over the year or the entire weeks. There are
various factors which affects the demand of the Marriott International. Seasonality is one of the
factors which affects the demands of the hotel. As customer love to travel in the pleasant and
beautiful whether instead of travelling in heat and summer. So when there is pleasant atmosphere
the customer gets more attracted towards the travel which increases the demands for the products
and services Marriott International. The other example is major customer of Marriott
international are ramblers, hikers, climbers. So these type of customer visit in the warm season.
That is why the demand in this season get increase than other seasons.
Time of the day/week
Customers mainly love to visit in the hotels with families. The different group of
customers includes the families couples who mainly prefer weekends or any sort of vacations for
travelling. In this case, the Marriott international have the high demands in the weekends
compared to rest of the weekdays.
Healthy living
There are many people who are very health conscious. This is the another group of the
hotel which are very much health conscious. The people which are very much concern about
their health and prefer to lead healthy life always choice the hotel where they can receive the
standard level of sanitation. This is the factors which affects demand of customers.
Cultural, regional and ethnic influences
Cultural factors also have a deep impact on the demand for tourism. Millions of people every
year go on religious tours like the Muslims going to Mecca or the Christians to their holy cities.
So at the time of any festival the demand of the Marriott international increases.
Economic
The national and regional crisis in the economy leads the fall in the income of the
consumer which effects the demand of the Marriott international negatively.

AC1.3: Compare customer profiles and their differing expectations and requirements in respect
of hospitality provision.
There are different customers’ expectations are their necessities, the consumer profile of
the hotels can vary.
Types of the hospitality business: hotel business are mainly of two types. Food and
beverages, accommodation, and travel and tourism. In this the Marriott International is
depending upon on the accommodation of the customers. That’s why customer mainly comes for
here for the purpose of the accommodation.
Different types of customer and their requirement are:
Leisure travellers: These types of customers generally travel for the purpose of enjoyment or
relaxation. Such customers require room services, entertainment, spa, swimming pool, etc. Ion
addition to this leisure travellers prefer to stay in luxury hotel rooms.
Business Travellers : These types of people generally travel for the business purpose such as
attending business meeting, conferences and seminars. These people require projector, space in
hotel for organising conferencing or meeting, Internet or Wifi facilities etc. In addition to this
such types of customers in hospitality industry prefer to book less constantly hotel rooms.
AC1.4: Analysing component affecting average spending power (ASP) in hospitality
businesses.
Majorly the customers who come to the hotels are newly married couples, families,
travellers or business associates people therefore to meet their level of expectations services to be
up to the mark to avoid their dissatisfaction. That has to be done with understanding the criteria
of different status, their income, socially or culturally of the customers refers their tastes,
preferences, wants and expectations and so designing the hotels view, its services according to
the less or more, food menu, accommodation facilities.
Management has to opt a strong market research and analysis relating to customer’s target and
segmentation, then building brand image quality of services, social contributions, availability of
resources, special preferences for some customers (Firdauz, Sapri, and Mohammad, 2015). To
provide with some health conscious dietary, healthy, nutritious and tasty food menus with
complementary services with reasonable prices, quick delivery can attract and build its strong
image and good perception in their mind.

Income: The income plays an important role in determining the purchasing power of the
consumer. Changing in purchasing power can results from change income changes. If the income
of a consumer is less than their spending power will automatically decrease and vice versa.
Status : Status is the crucial factor supported by the average spending power of the
customers is improved. If the shoper is socially royal person than they cannot decrease cost.
Social cultural influences : Many time the socio cultural influences affect the average
spending power of the consumer’s. For ex: At the time of the main festival customer's are more
eager to spend more than other festivals.
Economic situation : If the economic situation arises customer's expectation ,rather due
to lower economic conditions they are focused to cost less and lessened their average spending
power.
Economic and sustainable environment is obtained as this is the market’s demand to
develop and to sustain it is mandatory to meet the present requirement of the business with good
source of services that is why the hospitality provisions to be emphasized more with additional
tasks and improvements to expand further (Jauhari, 2014).
AC2.1: Evaluating the key phase in product and service development
As an operational manager, I have to analyse and evaluate the related keys stages, which
are been discussed under:
Idea Evaluation
For the development of the product the method which is to be implemented is idea
evaluation. As an operation manager of the Marriott International I have to evaluate an idea with
appropriate testing. The idea along with the new opportunities and treats is mandatory to be
analysed.
Market research
The second method is the market research, which is done for the development of the
product and services. This step is to analyse and identify the needs and preferences of the
customers of the Marriott International. The market research is help to identify the demand of the
new product and services in the market.
Idea screening

During evaluating an idea there are many ideas which comes as of. The second and most
important step in the development of the product is idea screening which helps in identifying the
best and feasible ideas and discarding those which are not appropriate.
Concept development and Testing
The third step in the development of new product and service is the concept development
and testing. The detailed strategy and the blue print version of an idea is the concept. To make
the idea presentable after the development of the idea is called the concept. The ideas selected
formed the screening send for the testing. A product cannot be launch until the concept being
tested.
Business analysis and development
After testing the product and service which Marriot International going to launch the next
step is for the analysis and the development of the product. The hotel has to finalized the concept
in which the operation manager analyses and takes the decision about the product profitability,
marketing mix and other product strategies are decided for the product.
Test marketing
Same as concept testing, to obtain feedback and the research the prototype is introduced.
The customer feedback is taken in order to check the product and make the changes if requires.
This process is very important because it certain the launch of the product (Jones, Hillier, and
Comfort, 2016 ).
Commercialization
Now once the product is ready the operational manager of the Marriott International have
to put the marketing mix into use. The final decision is to be taken. The organization decide the
market where they have to launch the product and the target customers to provide the launched
product and services.
Implementation of the latest technology : By implementing the latest technology at work place
business can develop innovative products or services. Firm can also bring improvement in
existing goods or services.
Workflow management tools: Business entity can implement the latest software as well as
workflow system , as this tool will provide an organisation with infrastructure which can be
further utilised for performance and monitoring of a defined sequence of tasks,

AC2.2 Examinining the features that contribute to the customers’ perception about trade good
and services
Customer perception plays an important role in Marriott Internationals ability to attract
new customers and retain the existing customers. Following are the characteristic which
contribute to the customer's view about products and services
Brand Image
If the product and service of the Marriott international will have the strong brand image
they will attract customer and draw the positive perception of the customers.
Nutrition and Dietary Requirement
The era of being healtholic is in very trend. If the Marriott international will provide the
nutritious food and fulfil the dietary requirements of the customer by their products than they
will gain the positive perception of the customer and vice versa.
Disabled Access
If the Marriott international have the special arrangements of the facility for the
disabled person, they it will the brand image of the organization stronger. Which helps them to
collect positive perception from the customers.
Availability of Resources
If the Marriott International, ensure enough availability of resources all access to the
customers, customer willing to come more to the hotels. And by this Marriott International will
receive the positive perception. (Evans, 2015 ).
Space Utilisation
Allowing the customers to use enough space is also the very important factor which
help the Marriott international to hold the positive attraction.
AC2.3 Assessing the opportunities and device affecting product and/or service development
within a hospitality environment .
Possibility are those which helps in the growth of the business, which in turn increase the
volume of the sales, profit whereas there are various constraints in the operation of the business that
can lead the decrease in sales revenue and profits. To identify the opportunities and threats for the
Marriott international manager in an organisation need to do the Swot analysis.

Brand image
Gaining brand image by providing new product and services with less price and larger
facilities would be the opportunity for the Marriott International.
Nutrition and dietary requirements
People are very much diet conscious if the Marriott international will serve the food by
keeping the dietary requirements of the customers in mind with the affordable price will provide
the great opportunity for them that will in future will help them in achieve sales (Evans, 2015 ).
Disabled access provisions
This is the facility includes the special arrangements for the disabled person which is the
biggest opportunity for the Marriott international.
Accommodation facilities
This could become the constraint for the Marriott international as there are many more
hotels which trying to provide the same accommodation facilities. So the level of competition is
very high.
Availability of the resources
Availability of the resources plays very important role in assessing the opportunity if the
Marriott International maintain the sufficient availability of the resources in their Hotel it will be
the bid opportunity for them. Opposite to that unavailability of resources can be a threat which can
provide the effect to the demand of the hotels.
2.4: Evaluating various merchandising opportunities for products and services in hospitality
sector.
The practising of contributing to the sale of products to the retail consumer is termed as
merchandising. Merchandising refers to the variety of products available for the sale and display
of those products in a way that it stimulates interest and insist the customers to make a purchase.
People nowadays prefer more traveling for their business organization and enjoyment purpose,
which turn effect increases the hospitality business overall world (Evans, 2015). Therefore, the
organization gets various merchandising opportunity over the other type of business which are
these aspects are discussed under-

Many of the case scenario, the expectation of the customers are more or less related to
high quality of services which is completely based on their buying power of customers. That is
why the hospitality business have opportunity to build more value with premium charge.
Apart from that if the economic condition of the travelers is improved then it provides
Marriott International a good merchandising advantage ( Evans, 2015).
following are the various merchandising opportunities
Cross merchandising: Cross merchandising is the retail price of marketing or
displaying the product and services from various categories. It is also known as add on sales.
Providing demonstration and food samples : By providing demonstration of food
sample Marriott international can grab the opportunities to attract customer's.
Use of online channel : Marriott international can take the use of online channel to
attract the customers and can seek the opportunities.
AC3.1 Evaluating different methods of pricing taking into account additional pricing
considerations.
There are various pricing techniques which Marriott international can use for setting their
prices. The different pricing method such as cost adjusted pricing know-how, marketing oriented
pricing, Service cost, cover charge and Minimal charge which hospitality business can be used.
Cost oriented pricing method: It refers to a pricing method in which some amount of
percentage is being added to the cost of product to obtain a final price.
Market oriented pricing method: It is also known as competitive based pricing method. In this
method the organization set the prices based on their competitors pricing.
Service charge: it is an extra charge which is being charge by the restaurants and the hotels for
providing additional services to the customers (Andringa, Poulston, and Pernecky,2016)
Which of these pricing and additional pricing considerations are applicable in your
organisation, and how are they applied?
In Marriott international the appropriate pricing method which is used is the market
oriented pricing method. As they analyse the market and competitor with appropriate marketing
research and set the prices as per their competitions.
If any of the methods above is not applicable, you must explain the reason why not.

They do not take the service charge from their customers for providing the additional
services.The reason behind is that is to retain their customers and make good relation with them.
AC3.2 Assessing the element which impact revenue generation and profitability in hospitality
sector
Following are the factors which can affect the revenue generation and profitability in hospitality
operations.
- Labour Intensity:However, the use of capital in Marriott international is less than industry
Hotel or hospitality industry is said to be the labour intensive.
- Shelf Life: new development the product and services, the organization can sustain in
the market. It is the fundamental measure of time that a trade good may be stored without
becoming unsuitable for utilization, intake, or sale In other words, it might refer to
whether a good should no longer be on a pantry.
- Elasticity of Demand: In Marriott international the cost elasticity of demand is in
inflexible, which indicate change in the demand for the product by customers is less than
the change in price of the products (Shum, Gatling, and Shoemaker, 2018).
- Standardization: in the management of the Marriott international they maintain the high
level of standard while selecting menu .
- Price factor : This is considered to be as an important factor which has direct as well as
significant impact on the profitability of firm. For instance, low pricing strategy
implemented by competitor of Marriott hotel that this can led to decline in the
profitability of an enterprise. It is required by business entity to adopt the flexible pricing
strategy, as this will help firm in reducing the negative effect of change in economic
factors on profitability and sales.
- Procurement : This is considered to be an important decision which is required to be
taken by management. Due unplanned buying of goods firm might have to suffer losses.
Management can adopt the Just in time approach as this will assist business entity in
reducing wastage and will help in minimising inventory costs.
AC4.1 Applying techniques for performance measurement and appraisal techniques to
single prospect of hospitality operations,
The performance measure is the quantifiable indicators which are used in
organization to measure the performances of operation employee's and management.

Quality Management: It is process that operation manager is required to examine the
quality of services and Marriott International products and identify the ways to improve it.
Speed of delivery: it is the very much important in hospitality industry, in the serving
time it is determining the time within which the order are accomplished is very essential to be
measure.
Sales performances: Other useful method is to control the sale performance and
increase the sales profit of the corporation, which make to add the growth of the overall as well
total income of Marriott international.
AC4.2 Determining the utility and limitations of the different quantitative and qualitative
appraisal method and its practical application in hospitality operations.
Quantitative technique includes the use of numbers , symbols, mathematical tool etc.
Quantitative technique can be defined as a collection of mathematical and statistical tools that
are used to provide powerful means of analysis using quantitative data for effective decision
making in business. These techniques involve scientific methods which is generally utilised
for solving complex problems. These tools in hospitality sectors assists manager in ensuring
effective as well as efficient utilisation of resources. Limitation of this method is that it does
not provide qualitative information. Quantitative techniques can be used in measuring or
determining the profitability of business in particular year.
Qualitative techniques is used buy hospitality sector for collecting the data.
Limitations of qualitative techniques is that collection of qualitative information can
be time consuming.
Mostly, in these evaluation method there are used to a simple data which cannot be taken
in the term of true performance figure (Solnet, Kralj, and Baum, 2015). As example: manner of
the employee, features of the product and services, characteristics of the employee are
recognized as the qualitative evaluation method. Today it can be determining by the interview or
through the groups.

AC4.3 Applying various concepts to business analysis, evaluation and planning appropriate to
different operations in hospitality sector ,
Business analysis : It has a key role in recent businesses scenarios (Introduction to Business
Analysis, 2015). It is a practice of enabling change in organization by defining needs and
recommendation solution to the stakeholders.
Business evaluation: Business evaluation is a procedure and a set of processes utilized for
determining the economical value of an proprietor interest in a company.
Business planning : A business plan is a road map for business which highlights objectives and
details about the way various activities can be executed for accomplishing desired targets.
Applying the various suggestions in the hospitality operations (Jauhari, 2014). Aim of these
services is to make the additional growth of the hospitality business. In this case, Marriott
international is a small hospitality business which need to develop the business process in
context of the same the business entity is planning for production and development of the
hospitality business process.
CONCLUSION
From the above report it can be said that operation management is the very important part
of the hospitality business. The report has provided the nature of hospitality product and service
area which can be categorised on the basis of tangibility and perish-ability. Assignment has
covered the factors influences the demand of the customer. The report has provided the deeper
insight of the factors affecting the demand of the hospitality along with the various stages in the
product and service development. Assignment will provide the opportunities and constraints
along with the merchandising opportunities for the product and services. Later, study has
covered the various performance appraisal methods for the product and services.

REFERENCES
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Industry. International Journal of Hospitality and Tourism Systems. 9(1).
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personal reflections on corporate challenges and research agendas. International Journal
of Contemporary Hospitality Management. 28(1). pp.36-67.
Shum, C., Gatling, A. and Shoemaker, S., 2018. A model of hospitality leadership competency
for frontline and director-level managers: Which competencies matter more?.
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Shum, C., Gatling, A. and Shoemaker, S., 2018. A model of hospitality leadership competency
for frontline and director-level managers: Which competencies matter more?.
International Journal of Hospitality Management. 74. pp.57-66.
Solnet, D., Kralj, A. and Baum, T., 2015. 360 degrees of pressure: The changing role of the HR
professional in the hospitality industry. Journal of Hospitality & Tourism Research. 39(2).
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Yang, L.T., Partlow, C.G., Anand, J. and Shukla, V., 2014. Assessing the competencies needed
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ONLINE
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