Hospitality Management Innovation

This assignment delves into the realm of innovation within the hospitality industry. It examines various aspects such as technology-mediated management learning, knowledge sharing, and sustainable service operations. The provided readings explore trends like hybrid online distribution channels and the impact of migrant labor on the sector. Students are expected to analyze these innovations and their implications for the future of hospitality.

HOSPITALITY
OPERATIONS
MANAGEMENT
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TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
P1.1..............................................................................................................................................3
P1.2..............................................................................................................................................4
P1.3,1.4........................................................................................................................................4
TASK 2............................................................................................................................................5
P2.1..............................................................................................................................................5
P2.2, 2.3.......................................................................................................................................6
TASK 3............................................................................................................................................6
P3.1..............................................................................................................................................6
P3.2..............................................................................................................................................7
TASK 4............................................................................................................................................8
P4.1..............................................................................................................................................8
P4.2..............................................................................................................................................9
P4.3..............................................................................................................................................9
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
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INTRODUCTION
Hospitality operations are the functioning of different products and services offered by
the hospitality groups. There are certain factors that affect and influence hospitality operations.
These factors are the rise and fall of demands of customers, pricing by the hospitality groups,
profit levels achieved. The report encloses a deep analysis made over the different hospitality
products and services offered in UK with a reference of IHG (InterContinental Hotels Group).
IHG is a multinational organisation having 5,028 hotels in about 100 countries. It is UK's leading
hospitality association. An analysis is made to discuss the structure, functioning and the factors
that influence the governance of any product or hospitality services.
TASK 1
P1.1
UK has always been a centre for attracting tourists across the world due to the class and
quality of hospitality offered by their hospitality groups. There variety of services offered by this
industry which include lodging, event planning, transportation, entertainment activities like
theme parks or amusement corners and diversified options for tourism. Tourism is also a part of
the hospitality sector (Baker and Magnini, 2016). It is the hub that connects all the other sectors
with each other.
Consumer attraction points are numerous in UK. This increases the probabilities steadily
increasing profit margins of the hospitality sector. Catering and food industry also faced a boom
due to technical developments in marketing and sales (Brookes and Becket,2011). Digital
sciences have led the consumers to virtually tour the facilities that are provided by the
companies. Hospitality comprises of leisure spending, independent businesses, catering ,
restaurants, clubs, pubs and outdoor activity management.
Sourcing, funding and management of these operations together and achieving customer
satisfaction develops a good impact on the financial reports of the organizations working
(Gibson, 2012). Several policy improvements undertaken by the British government allows the
investors to explore great opportunities and also giving UK tourism and hospitality an edge over
other industries.
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P1.2
IHG being a leading multinational brand has always been working with innovation to
provide in class hospitality services and products to the consumers across the world. But there
are certain factors that weight the demands for new products and services (Hayes, Ninemeier
and Miller, 2016). These are depicted below.
1. Hospitality industry has always been considered a leisure spending spot. The expenditure
of the consumer totally depends on their income. Inflation rates, tax policies are key
factors that affect a citizen's income. Lesser tax payments result in more expenditure on
luxury items.
2. The selling price of a good is the important factor to decide whether it will be successful
in the market. Similarly, IHG has to focus on effective price declarations regarding tour
packages as well as in house products.
3. IHG focuses on evolving taste and preferences of consumer. Nowadays consumers focus
on luxury with pocket friendly budgets.
4. Consumer population is the deciding factor of IHG' s profit or loss.
5. With better experiences the expectations of consumers increase and IHG has to focus on
meeting the fresh consumer demands.
6. Competition from other hospitality partners abides the employees of IHG to come up
with more innovative and developed ideas.
7. Advertisements also affect the company's products and services.
P1.3,1.4
Hospitality is a lifestyle industry hence the consumer profiles are created on the basis of
the amount they can spend to obtain these luxurious lifestyles (Jin and Weber, 2016). There are
three groups of consumers that is lower level, middle class and high class. The factors that affect
their spending on the hospitality are as follows:
1. Types of hospitality businesses means whether the consumer wants to expend on clubs,
pubs, food, adventure sports or tourism, etc. This choice depends on their income and
their will to expend accordingly.
2. Spending power defines the three customer profiles. The lower segment have a minute
amount of spending and generally avoid spending in outdoors. The middle class have
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moderate income hence, can afford to have a limited luxuries. While the high income
consumers can afford all the luxuries of the hospitality sector.
3. Accommodation range is again decided on the basis whether sufficient facilities are
achieved in their budget range.
4. Expectations and requirements have to be met as this creates an opportunity for the
sellers to have a chance of revisit.
5. Meal is an important part of any segments' expenditure. Hence, good quality food and
beverages must be offered irrespective of the consumer profile and the prices must be
reasonable enough so that there is no bad feedback received.
TASK 2
P2.1
In hospitality every product and service undergoes certain stages before coming to the
consumer. The first stage is where a new idea or an improvement in an old idea is acquired.
Innovation comes with skill, knowledge and creativity (Jones and Robinson, 2012). This idea
generated is evaluated and screened to weight all the possibilities related to it. A strategy or
concept is proposed for the development of this idea. This strategy design is on the basis of
feasibility, technicalities, market potential, consumer expectations.
An analysis of this strategy is made covering all the factors and measuring the threats,
opportunities related to the product or service (O'Fallon and Rutherford, 2011). The next stage is
actualisation of the product. A prototype is produced which undergoes technical and market
testing. This testing ensures durability of product or service. After this stage the product is
launched with completing of marketing and sales strategy of the company.
IHG is known for the classical services it gives to the customers. The key features that
help in meeting the customer's perception are technical advancements. IHG focuses on
introducing latest technology in hotel security which is supported by positive response from the
consumers, will develop more trust in IHG. Effortless consumer assistance is also an
indispensable part of IHG service line.
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P2.2, 2.3
Following are the opportunities and constraints affecting new products and services are
depicted below.
Opportunities:
 Customer demands are an opportunity to explore the new services. Preferences must be
based on the feedback acquired for old services.
 Market analysis must be carried so that the services launched acquire the maximum of
market share.
 Further intensification and development of the product must be possible.
Constraints :
 If the new service line has high cost then the probability for failure increases. The cost
must also cover labour and material cost.
 Failure of the service can cause threat to company's reputation and affect the branding.
Merchandising is the procedure that of selling products to a consumer. The services have
to be effectively delivered to the customers (O’Neill and McGinley, 2014). Merchandising
opportunities related to IHG are discussed below:
1. Internet marketing: Technology has made it possible to acquire consumers across the
world. Introduction of online services for acquiring the details of IHG cab be a good
merchandising strategy.
2. Newsletters can be sent through e-mail to the potential consumers and clients awaking
them about the new services launched by IHG.
3. Provisional offers must be introduced in first come first serve basis to attract customers.
TASK 3
P3.1
Pricing is an important issue in the hospitality industry. There are three pricing
techniques based on cost, demand and competition (Zhang, Joglekar and Verma, 2012). Pricing
on the basis of cost can be of two types that is cost plus pricing and mark up pricing. Cost plus
pricing ensures buyers about the changes in the market values while mark up pricing is common
to retail customers.
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Hospitality industry has to price its services and products meeting the competition as well
as the consumer demands. There are certain components that have to be kept in mind while
deciding the price of any services (Baker and Magnini, 2016). These components are last minute
entries, seasonal pricing, rack rates, package deals and commissions. Rack rates is the pricing
amount before application of discount. Last minute pricing is defined as pricing applicable for
consumers arriving on the spot at the hotel.
IHG is implementing additional pricing for the food service department (InterContinental
Hotels Group. 2016). The consumer will be informed at the time of booking by the employee
about the norms that the food pricing is not included in the accommodation charges. IHG can
experience losing consumers from the middle class sector as they have limitations over their
expenditure while on the other hand IHG can make profits from the Executive sections as they
would like to spend on their luxury irrespective of the pricing produced to them.
P3.2
In term of assessment of the profitability, firm generate revenue with depending on the
price and quantity of selling goods. In this context, below are the factors determine profitability
of IHG which affect to its revenue:
 Degree of competition: If IHG consist monopoly power in the country, then they are
never facing high competition. Thus, demand of the products and services inelastic. This
is helpful to the firm as they can easily increase profits through increasing prices of
products and services (Zopiatis, Constanti and Theocharous, 2014). For instance, cited
firm launch new services such as entertainment of the customers. In this aspect, they can
easily make high price for their services so that it create high profits for the industry. On
the other hand, if the market is very competitive, their profits can be reduce because
customers move towards the cheapest organizations. Hence, it will reduce profits of the
company.
 Increase in demand: In peak time, demand of hotels very high such as in summer
holiday and on new year, etc. (Thakran and Verma, 2013). It will assist to make high
profits for IHG because they can easily enhance their operations and their prices. It will
helpful to make high revenue at peak time so that it create positive impact on the
company actions.
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 Economy conditions: If the country economy grow, organization profits also increases.
It shows that firm give effective services to their customers. For instance, IHG make new
operations such as entertainment and spa facilities it will make high profits of the country
(Jayawardena, Lawlor and Tarnowski, 2013). It will also aid in making effective
economic growth of the nation.
 Advertisement: Successful advertisement make more revenue and profits for the
business. In respect to this, it will helpful to make more demand of the products and
services within the enterprise (Factors that affect the profitability of firms, 2016). In IHG,
manager make various types of the advertisement such as newspapers, internet, social site
and many more things. In addition to this, can be stated that best method to make
effective revenue is word of mouth through organization can easily make high profits.
TASK 4
P4.1
Performance measurement is refers as activity which determine outcomes from the
various actions which dine by business. In respect to this, IHG use various aspects which help to
make effective results within the enterprise. In this context, company considered, effectiveness
and efficiency of program that can be develop by enterprise such as human resources, employee
time and funding (Smith, Xiao and Tukamushaba, 2013). For identify development of new
products and services cited firm can use following measurements:
 Overview: With the development of new products and services, IHG can measure
employees performances. In respect to this, they demonstrate compensation, employment
status and opportunities for advancement. In these reasons' performance management
programs consist which develop a method through business enable to make fair and
accurate workers' participation (Huang, Zhao and Fu, 2014). In this, they can establish
performance standards. It is defines as measurement which help to meet with
organization expectations.
 Graphic scale rating: It is the ideal method through IHG can easily monitor their
performances. In this scale consist, list of duties and responsibilities which can be
measure by business for determine ranking for business outcomes (Li and Law, 2012). It
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requires supervision on employees performances which can be done through relatively
measurement. It done very quickly which considered workforce management duties.
 Management by objectives: It is another method, which is useful to measuring employees
performances in supervising IHG outcomes. MBO complete a process through business
can identify employees goals and resources which are necessary to achieve desired
outcomes within the enterprise (Sen, Sen and Kaushik, 2016). In addition to this, it
includes time frame through business can make timing for determine goals of the
company. For develop new products it is very helpful method which make effective
results within the firm.
P4.2
With the help of performance appraisal IHG can measure their performances through
they can monitor each individual within the enterprise. In respect to this, following effectiveness
can be considered in qualitative and quantitative methods of measurement business results:
 Pragmatic: Pragmatism is very important aspect which help to ensure effective system
within the enterprise (Scott and Laws, 2013). In respect to this, it demonstrates that all
employees understood effectiveness of the performance of enterprise. Thus, IHG can
make their profits high and enhance new operations easily.
 Relevant: Further, most successful appraisal program consist evaluation of critical
behaviour within the enterprise. In respect to this, cited firm can determine their time
frame and effective resources which helpful to make success in the enterprise (Davis,
Lockwood and Alcott, 2013.). In addition to this, appraisal techniques also eliminate
discrimination from the workplace. Thus, IHG can expand their market effectively.
 Uniform: Uniformity consist very important role in the success of company. In respect to
this, IHG make structure very standard manner through they can make high degree of
positivity. Appraisal is very important criteria through every enterprise can monitor their
performance which help to make high market share in different areas (Li and Li, 2013).
P4.3
Business analysis approach is the key area through enterprise can monitor their
performances. In includes planning and monitoring to the different aspects which can be develop
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by enterprise (Zopiatis, Constanti and Theocharous, 2014). In this context, below are the steps
that can be taken by IHG for their development: Get oriented: It bis very important aspect which help to develop business plan in the
company. In respect to this, IHG can determine their objectives through they can make
positive results within the enterprise. In this step they are clearly determines about the
scope, requirements and objectives of business outcomes (Thakran and Verma, 2013). Discover the primary business objectives: It is very common aspect which determine
what is right and wrong for making scope of the company. In respect to this, IHG
discover expectations from their primary stakeholders. In addition to this, they are
ensuring business objectives which are unique to every person of the company. Determine scopes: Scope does not mean that company implement their plan. In respect to
this, IHG determine their solutions for extent technology and business process for
primary business objectives. Grafting scope statement and reviewing key term of the
enterprise make technology stakeholder (Li and Law, 2012). With the help of scope
defining, cited firm easily take steps to development of future aspects which assist to
evaluate performance of the company. Formulate business analysis plan: Business analysis plan defining credibility and
realistic plan through IHG can easily monitor their performance and expectations. In
these regards, chosen enterprise can identifying the timelines for completing business
analysis deliveries. In addition to this, they can also define most appropriate different
types of business analysis, scope and methodology (Sen, Sen and Kaushik, 2016). Define detailed requirements: Detailed information provide to implementation effective
plan with specific information which need to implement solutions within the company. In
this aspect, IHG analysing the information which are necessary to understand specific
features or process changes. Implementation through technical support: In this step for monitoring the business
performance, IHG review whole plan which help to make effective transactions within
the country. They can engage the quality assurance and understand key issues which need
to develop by the enterprise for enhance new operations (Huang, Zhao and Fu, 2014). In
this context, company have required to make implementation effectively so that they can
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engage with the new activities within the enterprise. It will assist to develop business
results according to their expectations.
 Assessment and create solutions: At the last step, IHG make assessment and solutions
where they are lack to develop operations. In respect to this, they can monitor their
performance which will helpful to enhance operations of the enterprise in addition to this,
they evaluate actual progress of the company through monitoring activities (Scott and
Laws, 2013).
CONCLUSION
The above report is based on the hospitality operations and management with reference to
IHG, a leading hospitality multinational brand in UK. A brief description of the basic sections of
the hospitality sector in UK was followed by the study of different factors that affect and
influence the demand of products and services for the company. The different aspects of pricing
new products and services with their impact on the consumer demands is understood. The
process of developing an idea into a new product and services is explained and the different
measures regarding the performance, quality and quantity of the new product or service is
known. The report also describes and evaluates the different approaches to business analysis for
the launching and merchandising of the new product.
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REFERENCES
Books and Journals
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Brookes, M. and Becket, N., 2011. Internationalising hospitality management degree
programmes. International Journal of Contemporary Hospitality Management. 23(2).
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Davis, B., Lockwood, A. and Alcott, P., 2013. Food and beverage management. Routledge.
Gibson, P., 2012. Cruise Operations Management: Hospitality Perspectives. Routledge.
Hayes, K. D., Ninemeier, D. J. and Miller, A. A., 2016. Hotel Operations Management. Pearson
Education.
Huang, Z., Zhao, C. and Fu, X., 2014. Triggers and inhibitors of illegitimate customer
complaining behavior: Anecdotes from frontline employees in the hospitality
industry. International Journal of Contemporary Hospitality Management. 26(4).
pp.544-571.
Jayawardena, C., Lawlor, F. and Tarnowski, M., 2013. Challenges and innovations in hotel
operations in Canada. Worldwide Hospitality and Tourism Themes. 5(2). pp.177-189.
Jin, X. and Weber, J., 2016. Exhibition destination attractiveness – organizers’ and visitors’
perspectives. International Journal of Contemporary Hospitality Management. 28(12). pp.
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assembly line to hospitality industry innovation. International Journal of Contemporary
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Scott, N. and Laws, E. eds., 2013. Knowledge sharing and quality assurance in hospitality and
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Thakran, K. and Verma, R., 2013. The emergence of hybrid online distribution channels in
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Zhang, J. J., Joglekar, N. and Verma, R., 2012. Pushing the frontier of sustainable service
operations management: Evidence from US hospitality industry. Journal of Service
Management. 23(3). pp.377 – 399.
Zopiatis, A., Constanti, P. and Theocharous, A.L., 2014. Migrant labor in hospitality: The
Cyprus experience. International Journal of Hospitality Management. 37. pp.111-120.
Online
InterContinental Hotels Group. 2016. [Online]. Available Through:
<https://www.ihgplc.com/about-us/our-strategy>. [Accessed on 26th November, 2016].
Factors that affect the profitability of firms, 2016. [Online] Available through:
<http://www.economicshelp.org/microessays/profit/>. [Accessed on 26th November
2016].
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