Hospitality Operations Management Report: Hilton Hotel Analysis

This report provides an in-depth analysis of hospitality operations, specifically focusing on the Hilton Hotel. It begins by analyzing the nature of hospitality products and services, including their perishable and intangible qualities, and examines the different departments within a hotel. The report then evaluates the various influences affecting demand patterns, such as seasonality, time of day, and economic factors. Customer profiles are compared based on spending power and expectations, and the factors affecting average spending power are analyzed. The report also explores the key stages of product and service development, pricing methods, and revenue generation strategies. Furthermore, it examines performance measures, appraisal techniques, and approaches to business analysis and planning within a hospitality context. The report concludes with proposals for action based on the findings.

Hospitality Operations
Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
1.1 Analyse the nature of hospitality product and service areas.................................................1
1.2 Evaluate the different influences affecting patterns of demand within hospitality
operations....................................................................................................................................2
1.3 Compare customer profiles and their differing expectations and requirements in respect of
hospitality provision....................................................................................................................3
1.4 Analyse factors affecting average spending power (ASP) in hospitality businesses............4
2.1 Evaluate the key stages in product and service development applied within a hospitality
operation......................................................................................................................................5
2.2 Analyse the features which contribute towards the customers’ perception of products and
services........................................................................................................................................6
2.3 Assess the opportunities and constraints affecting product and/or service development
within a hospitality environment.................................................................................................7
2.4: Evaluate different merchandising opportunities for hospitality products and services.......7
TASK 2............................................................................................................................................7
3.1 Evaluate different methods of pricing taking into account additional pricing considerations
.....................................................................................................................................................7
3.2: Assess the factors which affect revenue generation and profitability in hospitality
operations....................................................................................................................................8
TASK 3............................................................................................................................................8
4.1 Apply a range of performance measures and appraisal techniques to individual aspects of
hospitality operations..................................................................................................................8
4.2 Determine the usefulness and limitations of the various quantitative and qualitative
appraisal techniques....................................................................................................................9
4.3 Apply approaches to business analysis, evaluation and planning appropriate to hospitality
operations, making proposals for action.....................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11

INTRODUCTION
Hospitality management is that study of developing relationship between guest and
manager the hospitality industry has different parts in the service industry that includes lodging,
restaurant, event planning and other sector in this industry. The report is based on Hilton hotel
which is global brand of full services provider hotels and resorts to the guests (Alexakis, 2011).
The main purpose of this assignment is to analyse the nature of hospitality products and services.
There are various types of customer profile and their expectation which are analysed as per their
average spending services in the hospitality sector. Along with this, there are different
opportunities for hospitality products and services that are evaluated in this report.
TASK 1
1.1 Analyse the nature of hospitality product and service areas
In hotel business, the products and goods can be food and beverages. All such products
are very much perishable in nature. Thus, it is based on different criteria, the nature of Hilton
hotel's hospitality products ad service areas are described as under:
Perishable – The perishable refers to that services which can not be stored sale in the
future. In Hilton hotel, they are serve various food items to their customers that can be stored for
future selling.
Intangibility – It is refers as that services which can not be touched or seen. They are
used for evaluated or measured by customer satisfaction. As Hilton hotel provide the spa services
or facilities to their customers that is intangible in nature.
Inseparability – These are such services which can not be separated from an individual
who is providing it. The goods and services produced in the hotel have to be consume at hotel
only as one can not take such facilities at home for later consumption (Bartram and Dowling,
2013).
The Hilton Hotel provides different services or facilities to their customers which are
described as under:
Room divisions – The rooms are prominent part of hotel. As the department of rooms
should be according to their customer requirements. In Hilton hotel, the room division are fully
based on occupancy such as single and double occupancy, couple friendly room, sea side room,
balcony view rooms are exist for the customers.
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Food and beverage – These are essential part of hotel which develop the reputation.
Hilton hotel has provide best quality based food items and also serve such things to their guest.
Along with this, the hotel offer timely food to their guests living in the hotel. Such type of
quality facilities are develop in the hotel a brand (Bharwani and Butt, 2012).
Conferences and Banqueting – It is created for the corporate meetings and banquet area
is for family function. Hilton hotel has huge space for conference hall and banquet area for their
customers. This area provide customers to arrange big feast such as lunch and dinner.
1.2 Evaluate the different influences affecting patterns of demand within hospitality operations
Hotel business does not same type of demand in all over the years and even all days in
the week. There are various factors through which demand of customers varies. Along with this,
there are four major influential factors which are described as under:
Seasonality – It is one of the major factor which directly impact on industries in given
time period. In given time period, the demand of specific industry products and services are on
peak level. The hospitality operation are highly affected by seasons. At the time of Christmas
and new year, demand of Hilton hotel enhancing due to ample number of visitors.
Time of Day/week – The specific time of day/week affects the demand of Hilton hotel
goods and services. At the time of weekend, demand will goes towards increase of Hilton hotel
as people comes for get together and enjoy the weekends.
Healthy living – This is quote “Health is Wealth” people are very health conscious. As
demand of hotel goods are going to increase so this will directly affected by their healthy
environment that is provided by hotel. Health;y living includes fresh air and water, clean and
neat areas for living and healthy food. Hilton hotel demand is also affects such elements (Causin
and Ayoun, 2011).
Cultural – It is the set value and ideologies of specific community. Culture is divided
into location, age and social status and so more. The demand of hotel can directly affected by
such elements. If hotel is located at prime location then demand will be automatically enhanced
in positive manner.
Regional – The temperature is the major regional factor which can vary of demand
pattern of customers for the specific type of hotel. For instance, if Hilton hotel is based on the
region where temperature is not stable so the demand of hotel business are automatically
decreases.
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Ethnic influences – It is basically an inherited status which is based on society and
community in which person lives. It can enhancing the demand of specific hotel if they are
providing quality based food items that are associated with their ethnicity.
Economic factor – These are such factors which are related to growth of an economy of
nation. When customers are spending more power, then they will spent more on luxurious and it
will enchaining the demand for luxury hotel such as Hilton hotel (Crawford, 2013).
1.3 Compare customer profiles and their differing expectations and requirements in respect of
hospitality provision
Basis for comparison Upper class Middle class
Spending power It is determined as rich class
area of society and
community. As the upper class
includes sportsperson,
celebrity and business tycoon
who has highest spending
power in the society. They are
determined as the hotel which
provide five star facility to
their customers. They have
spending power and as per this
they are selecting hotel to stay.
Middle class is basically
normal individual of society
with average spending power.
This area of community
usually concentrate on saving
rather than spending on luxury.
They are expect quality goods
services at reasonable rate.
They can choose hotel as per
their requirement and need
rather than focus on luxury
services.
Meal experience The upper class people require
best meal experience so they
always want quality based
food items (Ferdinand and
Kitchin, 2012). They spend
more money on their diet and
healthy products.
The middle class mainly
concentrate on good quality of
food items that will satisfying
their hunger. They does not
spend more capital on food
products because they are
focus on satisfying their
hunger.
Expectation and Requirement This segment of customers In this segment, they are
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expect the luxury facilities and
services such as personal
parking service, personal
refrigerator and so more from
the hotels and also they can
spend capital as per the
experience (Kimes, 2011).
consuming best quality based
services and facilities at
affordable rate. They have
spending average spending so
that they are unable to meet
with their expectations. There
are such requirement which
should be satisfied all needs
and demand such as good food
and clean room.
Price Consideration It is the segment which does
not determine and consider
price while choose hotel
because they have enough
power to spending money.
They are selecting luxury hotel
such as Hilton hotel that will
satisfying all guests needs and
requirements.
The middle class segment
considered as price sensitive.
They are select hotel which
offer reasonable price to their
customers along with better
services.
1.4 Analyse factors affecting average spending power (ASP) in hospitality businesses
In the context of Hilton hotel, the customers are offer wide range of services with
different level of price level that carry out regarding average spending power (ASP). The average
spending power (ASP) reveals the customers whole expected demand and need in better manner.
There are various factors which vary average spending power that are described as under:
Income size – The income is considered as earning of a person. It is the common that
individual spending is highly affected by their income (Lashley, 2012). If size of income is less
then individual will select average spending hotel where they require to pay affordable money. If
an individual earning is more so they will choose hotel such as Hilton hotel.
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Status – The status is image of the society that directly affects on average spending of
customers. As status is developed out of money, if a person have enough money so they are
determined as high status and vice versa. This will help in maintain that status which spend more
capital.
Economic situations – Lastly, economic situations of nation has directly affects on
average spending power of customers (Sigala, 2013). If interest rate is low then customers will
spend more money for buying goods and if they will have more capital so they are spending
more in different products. Hilton hotel contribute their capital in increasing economic condition
in better manner.
2.1 Evaluate the key stages in product and service development applied within a hospitality
operation
There are various key stages in product and service development applied in the
hospitality industry that are described as under:
Idea generation – The new product development procedure begin with idea generation.
It is the systematic search for new goods and services ideas and thoughts. It can be established
that internal and external factors. In this, internal means research and development while
contributing with employees. On the other hand, external refers to the customers and
competitors. Hilton hotel has generating ideas of suit room from their guest feedbacks and
response.
Idea screening – This is the next step in this procedure. In this screening refers to
filtering different ideas. The firm select such ideas that can be turn into getting high income and
profitability for the business.
Concept of development and testing – This concept is developed by Hotel Hilton which
is super room services that includes different services or facilities such as high class interior,
personal swimming pool and personal refrigerator. It is that concept which required to be tested
with groups of target customers and also ask them questions regarding specific services (Sunder,
2013).
Business analysis – This is the process which includes review of sales, cost and value of
projections for developing new services and goods. In this, if they are meet with set
organisational objectives then it will move towards further stage of development in proper
manner.
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Product/Service development – This is that stage where products are developed and
manufactured effectively. The research and development will formulate and test the physical
version of production concept.
Test marketing – Lastly, this is the stage where products are commercialised. In this
stage, the proposed marketing programme are tested in realistic market place for attracting large
number of customers (Tsang, 2011).
Launch – The test marketing has provide management information which make final
decisions regarding introduction of new products or services. Before launching, hotel should
focus on their launch timing. For example, economy is decreases then it provide better to wait for
some time and than launch.
2.2 Analyse the features which contribute towards the customers’ perception of products and
services
There are certain factors that directly influences customer perception towards products
and services which are described as follows:
Brand image – It is one of the most considerable factor for customers that will develop
perception regarding specific goods and services of Hilton hotel. Along with this, Hilton hotel
have good brand image then customers point of view would be positive in nature.
Availability of Resources – The main asset or resources for hotel is availability of
required rooms in the hotel. If customers is not able to get room so this will change the
customer perceptions towards hotel. It is very essential to have enough resources for reaching
with requirement and needs of guests.
Style of service – The customers want complete services and facilities of price paid by
them. It is very essential to understand that what type of services and style providing to their
customers. In hotel, there are variety of food which are offered so basically mos of the hotel are
use buffet style services for guests in the context of catering facilities (Vlachos and
Bogdanovic, 2013).
Standardisation – It is the main strategy which allow Hilton hotel in giving high
quality based services in different locations. The main aim of standardisation is to transform
the old values and advantages into new excellence of services.
Space utilisation – The space is the area or location in which hotel manager are
operating their business operations and functions. It is essential for hotel such as Hilton hotel
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which provide proper utilisation of space. Due to this, if hotel is not using its space in proper
manner so this will change the perception of customers.
2.3 Assess the opportunities and constraints affecting product and/or service development within
a hospitality environment
Factors Opportunities Constraints
Brand Image Hilton hotel provides services
of super room to their
customers in effective way so
this will create good brand
image of the hotel.
In this, the constraint is if
Hilton hotel is manage and
maintain their services so they
have to bear cost by losing
brand image in the market
place.
Accommodation facility This is the main opportunities
for hotel is to offer best
services of accommodation to
their customers.
If firm is not offer enough
accommodation to their
customers so this will might
lose their customers.
2.4: Evaluate different merchandising opportunities for hospitality products and services
Merchandising is the procedure of advertisement of products and services which are
available for sale. There are various types of merchandising opportunities for hotel that are
described as under:
Visual merchandising – This is the display method that can be used for addressing the
benefit of specific goods and services which are being sold. As Hilton hotel can display the TV
at reception which show regarding hotel goods (Vlachos and Bogdanovic, 2013).
Digital merchandising – This is refer as e-commerce or online merchandising which
includes everything from site performance and digital goods display to digital marketing and
email marketing initiatives.
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TASK 2
3.1 Evaluate different methods of pricing taking into account additional pricing considerations
Pricing is the procedure of organization which help in setting up the business goods and
services in better manner. There are different pricing method which can be used by Hilton hotel
that are described as under:
Cost oriented pricing – In this, the manufacturer calculate the cost of production and
add certain amount of income in selling prices. The profit percentage is calculated on total cost
that is fixed and variable cost. For instance, the super room cost is 400 GBP and markup is
around 20% on cost. Then selling price will be - 400+400*.20 = 300 GBP.
Market Oriented pricing – In this method or technique, the benchmark for setting price
is price set by organization. If competitors alter the prices then as per this company can make
proper change in price (Vlachos and Bogdanovic, 2013).
Service Charge – The service charge is prices which changed by organization for their
services or facilities. Hilton hotel charge high price for their services due to this they are
offering quality based goods to their customers. At the time of selecting prices for their services
hotel should consider the service quality.
3.2: Assess the factors which affect revenue generation and profitability in hospitality
operations
The profitability is earning within any organization and there are various factors that
directly affect on profitability of business operations are described as under:
Elasticity of demand – The elasticity of demand define as the demand for goods which
is change in other economic variable that includes price and income of customers. This is
directly affects on profitability as if the demand of hotel is increasing and vice versa.
Procurement – It is determined as storing and monitoring products for the future
purpose. This can enhancing the warehousing cost and value for an organization and also
increasing cost which can lead towards lower income.
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TASK 3
4.1 Apply a range of performance measures and appraisal techniques to individual aspects of
hospitality operations
This is the procedure which measure the individual performance and overall
organization terms of productivity in regards of setting goals and objectives. There are various
methods and techniques that can be used by Hilton hotel are described as under:
Quality management – It is important element which measure the performance in
hospitality operations and functions, this includes quality of services that are offer by hotel to
their guest in better manner.
Data analysis and evaluation – It is the method which is used by Hilton hotel for
examining overall performance. For taking data of financial statement into consideration, the
evaluation has been done.
4.2 Determine the usefulness and limitations of the various quantitative and qualitative appraisal
techniques
Qualitative – It is the method which is related to performance appraisal technique that includes
qualitative information such as customer satisfaction, attitude and behaviour of customers
towards hotel services (Vlachos and Bogdanovic, 2013).
Quantitative – The quantitative method provide data and information regarding sales
performance of the company.
Particular Usefulness Limitation
Qualitative It is demonstrated as real
experience of customers
because this is mainly focus on
narrative from respondents.
They are not able to provide
accurate statistical data
analysis.
Quantitative This will show the correct data
and information from financial
statement about performance of
hotel.
This does not capable to
capture the real time
experience of customers.
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