Case Study: Rooms Division Operations Management, Auckland Campus

This case study analyzes the operational challenges faced by a hotel's rooms division, focusing on issues that led to decreased profits. The case examines the impact of new guest amenities, such as expensive toiletries and fresh flowers, increased video services, and employee transportation costs. I...Read More

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ROOMS DIVISION OPERATIONS MANAGEMENT
Rooms Division Operations Management
Name
Institution

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ROOMS DIVISION OPERATONS MANAGEMENT
Rooms Division Operations Management
Case study answer
Key problems and issues and solutions
The new housekeeper introduced different ways of serving the customers, some ways
have worked while others have not worked. One of the things that have reduced profits is
supplying bedrooms with stationery like ballpoint pens, envelopes, writing materials, a
complimentary tourist map, and a sewing kit. In the same bedroom washroom area there are
other new introduced products such as shampoo, conditioner, shower cap, shower gel, cologne
and after-shave lotion. The company that supplies these products- Yves Saint-Laurent is a very
expensive company and the matter gets worse when these products are given away thereafter.
These products have a lot of impact on the hotel’s revenue and led to the decrease of profits. The
guest’s supplies stood at 27, 824 compared to the budgeted 20, 310. This means it was up with 7,
514 which is a very big figure that could have been avoided.
In addition to the new products, fresh flowers have been distributed in the bedrooms on
each dressing table and around the hotel. One of the challenges of fresh flowers is that it withers
very first and thus they have to be purchased almost every day. Though the reason for purchasing
them and being distributed around the hotel was good- to have that beautiful scent around- the
money used to purchase them is high. Instead of the budgeted 1000, fresh flowers costed 2402, it
went high with 1402 which is way above the allowed extra spending.
Another thing that rose the profit is the number of videos around the hotel. They were
increased from two per day to four per day. It increased the budget which in turn reduced profits.
Thus, the budget was increased by 840 which partly contributed to reduced profits.

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Employees were also transported from home to the workplace and back home. There is
no problem with checking on the safety of the employees but this has also raised costs for the
hotel because fuel is costly. Guests are also offered free transport from the airport to the hotel
and back to the airport from the hotel. As they stay in the city, they are also offered free transport
in the train. The budgeted transport cost was 4, 550 and the actual cost was 21, 600. This really
contributed a lot to the reduced profits since the overboard was 17, 050. Indeed, an action should
be taken to reduce this amount.
The housekeeper brought long-standing colleagues to be staff in the housekeeping
department. They are the ones who contributed greatly in the rise of the transportation cost. The
housekeeper says they are dependable but the assistant executive housekeeper does not since he
does not see their housekeeping skills. Bringing in long-standing colleagues into employment
may have been a wrong move. Salaries and wages stood at 227, 204 which was 5, 206 dollars
higher than the budgeted amount. A better way of employing staff should be sought so that there
can be professionalism.
The linen system has also been a challenge. Linen laundry is done by an outside company
that always comes to change linen at around 11:00 am which gives less time to the staff to count
the laundry while it goes out and comes in. Normally the clean linens are brought in and put on
the shelves without counting. Due to this, counting checks are done once in a while and when
they are done some linen are normally not found. The linen hire was 9, 440 above the budgeted
price. The cleaning contract was 464 higher above the budgeted cost. These prices are what
contributed to the total drop of profit.
The assistant executive staff was complaining of re-ordering of cleaning materials. There
is a constant re-ordering of cleaning materials and testing of the said materials to check their

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efficiency. The budgeted cost of cleaning materials was 1250 while the actual cost was 2054.
This was contributed by constant change of the materials.
The hotel discourages asking guests for telephone charges especially those of oversees.
The oversees telephone charges are normally costly yet guests cannot be asked about it since it is
seen as lowering the image of the hotel. The hotel oversees telephone charges that were not
settled stood at 4, 732 dollars. This also caused reduction of profits.
Specific actions and recommendations
To lower the amount of costs, especially in the supplies of guests, the hotel can choose to
have the basics needed in a room like the soap. Things like shampoo, conditioner and cologne
can be left for the guests to purchase at the reception area. The other option would be for the
products to be supplied with a company that offers its products with a more affordable price
(SiteMinder, n.d.).
In the case of flowers, the hotel can choose to either order more affordable flowers or
reduce the number of flowers being distributed around the hotel. Another way to curb the cost of
hotel flowers is to opt for artificial flowers which last long and do not get replaced every time.
For the good scent and environmental supportive sprays may be used.
Videos offered per day can also be reduced back to how it used to be offered. This can
boost the hotel’s profits. Transport for the staff needs to be reduced, the late-night transportation
is what the employer can arrange and agree with staff to pay a bit of a fee so that it is not
completely free. The morning hours can be removed completely. The staff can cater for it
themselves. As Peter Done (2018) puts it the employee can choose to pay for staff if the staff
have been on duty way beyond the late-night hours.

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In-house laundry can be opted for against the contract-hire linen laundry and this can be
supported with many reasons. Since the linen will be cleaned within the hotel, there is assurance
that they will not be lost because the housekeepers can always count it right away. Another
reason for opting for in-house linen is they can be cleaned well and used at the right time without
wondering when the linen laundry company will drop the fresh ones and pick the dirty ones
(Jenkins, 2012). It is also affordable since all the hotel will need is detergents and a machine so
there are no other extra costs. The staff will be trained on how to use the equipment for laundry
and will be shown how to do it. The hotel can also purchase washing equipment that is friendly
to the environment and saves water (Jenkins, 2012). Furthermore, the hotel can opt to reduce the
number of towels and bedsheets taken to a room if one person is going to spend a week in the
same room. They can decide to do one towel for two days and of course the guests should be
informed of the same when they check in.
Housekeeping staff can also be given optimized standard cleaning measures. For
example, if a guest spent a night in a room that room needs less cleaning which means less time
will be spent there and less cleaning products compared to a room that has been occupied for a
whole week (Collins & Parsa, 2006). Another trick also is a room occupied by one person is easy
to clean and should be quick compared to a room that a group of people have stayed in.
For things to move smoothly within the housekeeping department, committed and
dedicated staff need to be employed. The hotel should hire professionally and not by word of
mouth. Warnings should also be given out in case laziness is identified, if the warnings are not
taken seriously then the person should be laid down (Suboleski, 2012). This will ensure that no
staff is pushed to do their responsibilities and that work is done efficiently and on time. Linen

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room attenders should be added so that when some are taking care of washing the linen and
folding others will be distributing clean towels.
Staff uniforms also added to the reduced profits since it went up with 650 dollars the
budgeted amount. This can be looked into it may be because there is replacing of uniforms or
they are easily damaged. Thus, the staff should also be asked to take care of their uniforms so
that costs can be reduced.
Cleaning materials are not supposed to be re-ordered every single time because it costs a
lot of money (Hydrofinity, 2018). A company which offers good but affordable products should
be contracted and should supply the products in bulk. This way the assistant executive
housekeeper does not have to test the products every time and re-ordering every single day. This
will lead to some money being saved and thus there will be increased profits.
Even with all these challenges there are still improvements and things that can be called a
success. One of it is communication at the front office. Communication flows smoothly between
the housekeeping staff and the front office. Front office efficiency has been cited to contribute to
giving a guest a good impression who tend to come back after being served every time (Lo,
Stalcup, & Lee, 2010). Whenever there is housekeeping needed and the guest calls the front
office the front office contacts housekeeping immediately and what was required is done right
away. This is one of the reasons why the number of guests grew in this time. Thus, the front
office can always be upgraded so that it can give a good impression to guests every time they
visit.
Stationery and postal products posted in the rooms have also given guests a good
impression of the hostel. The budgeted costs of the stationery were moreover not exceeded thus

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was managed well. Room occupancy furthermore increased from 62% to 63.7% this has been
contributed more by the products present in the hotel rooms and the front office reception.

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References
SiteMinder. The Science of Supply and Demand: Is your hotel maximizing room revenue? |
SiteMinder | Revenue Management | blog. Retrieved from
https://www.siteminder.com/r/hotel-distribution/hotel-revenue-management/science-
supply-demand-hotel-maximising-room-revenue/
Done, P. (2018). Providing transport for employees: should you organise their lift home?.
Retrieved from https://smallbusiness.co.uk/providing-transport-for-employees-261533/
Suboleski, S. (2012). Room Service Principles and Practices: An Exploratory Study[Ebook] (3rd
ed., pp. 8-40). Las Vegas: University of Nevada. Retrieved from
https://digitalscholarship.unlv.edu/cgi/viewcontent.cgi?
article=2781&context=thesesdissertations
Hydrofinity. (2018). Making Sense of Hotel Laundry Costs: A Comparison. Retrieved from
https://www.hydrofinity.com/blog/hotel-laundry-costs
Collins, M., & Parsa, H. G. (2006). Pricing strategies to maximize revenues in the lodging
industry. International Journal of Hospitality Management, 25(1), 91-107.
Lo, A. S., Stalcup, L. D., & Lee, A. (2010). Customer relationship management for hotels in
Hong Kong. International Journal of Contemporary Hospitality Management, 22(2),
139-159.

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