Report on Hospitality Operations Management: A Marriott Hotel Analysis

This report provides a comprehensive analysis of hospitality operations management, specifically focusing on the Marriott Hotel. It begins by examining the nature of hospitality products and services, including tangibility, heterogeneity, inseparability, and perishability. The report then evaluates various influences on demand patterns, such as seasonality, time of week, economic factors, and health consciousness. Customer profiles are compared, highlighting differing expectations based on spending power, business type, and meal experiences. Factors affecting average spending power, including income, status, social influences, and economic conditions, are also analyzed. The report further explores key stages in product and service development, from idea generation to commercialization, and assesses features that shape customer perceptions. It also evaluates opportunities and constraints in product and service development, as well as merchandising opportunities. Different pricing methods are assessed, along with factors influencing revenue generation and profitability. Finally, the report discusses performance measures, appraisal techniques, and approaches to business analysis and planning within the context of hospitality operations management.

HOSPITALITY
OPERATIONS
MANAGEMENT

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
1.1 Analysing nature of hospitality product and service areas...............................................3
1.2 Evaluating different influences affecting patterns of demand within hospitality operations
................................................................................................................................................4
1.3 Compare customer profiles and their differing expectations and requirements in respect of
hospitality provision...............................................................................................................4
1.4 Analyse factors affecting average spending power (ASP) in hospitality businesses.......5
2.1 Evaluate key stages in product and service development ..............................................5
2.2 Analyse features which contribute towards customers’ perception of products and services
................................................................................................................................................7
2.3 Assess opportunities and constraints affecting product and/or service development......7
2.4 Evaluate different merchandising opportunities for hospitality products and services....8
TASK 2............................................................................................................................................8
3.1 Evaluate different pricing methods under hospitality operations management...............8
3.2 Assess factors which affect revenue generation and profitability in hospitality operations.
................................................................................................................................................9
TASK 3..........................................................................................................................................10
4.1 Performance measures and appraisal techniques to improve hospitality operations
management..........................................................................................................................10
4.2 Usefulness and Drawbacks of the various quantitative and qualitative appraisal
techniques and their application to hospitality operations...................................................10
4.3 Apply approaches to business analysis, evaluation and planning appropriate to hospitality
operations.............................................................................................................................11
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12
Stages of the New Product Development (NPD) Process. 2018. [Online]. Available
through:<http://textilelearner.blogspot.com/2013/11/stages-of-new-product-development-
npd.html>.............................................................................................................................13

INTRODUCTION
Hospitality industry is a broad category of service industry which is responsible for
providing food and accommodation services in places such as hotels, amusement parks,
conference centres and resorts (B. DiPietro, Cao and Partlow, 2013). The main focus of such
industry is to provide better services to its customers with proper satisfaction and providing
specific experiences. In this report, the chosen hospitality industry is Marriott Hotel. It is an
American multinational hospitality company which has a franchising of large number of hotels
and lodging facilities. It is largest hotel chain in the world headquartered in Maryland
Washington. Main purpose of report is to analyse the nature of hospitality services and the
factors which affect pattern of demand within its operations. It also covers the average spending
power of customer in this industry. Further it discuses opportunities and constraints affecting
industry's environment and the factors affecting revenue generations in hospitality operations.
TASK 1
1.1 Analysing nature of hospitality product and service areas
Nature of the Hospitality product and services are as follows-
Tangibility-Tangible goods are those which can be seen, felt or touched by customers
on the other hand intangible services cannot be touched it can be only felt. Tangible product in
hotels such as food and beverages can be seen and touched by customers but the reputation of
Marriott and the friendly services, reliability given to customers can be only felt .
Heterogeneity- Services which results in variations from place to place or from customer
to customer is termed to be heterogeneous factor. Services in Marriott such as room
service,housekeeping services differ caused by the location, time and season.
Inseparability- Goods can last for a long period of time but services are produced and
consumed at the same time (Boella and Goss-Turner, 2013). Service exist during the period
person is engaged and immersed during its experience. When a customer books a banquet or
room in Marriott they can only enjoys services till he is present there neither, take advantage
when at home.

Perishability- Services and experiences cannot be stored for future use. If a service is
available and not sold that time it disappears forever. Once tourist books room at Marriott and
doesn't visit they cannot avail service on next day it becomes perishable in nature.
1.2 Evaluating different influences affecting patterns of demand within hospitality operations
Demand for hospitality operations is affected by following factors-
Seasonality- Seasons are characterized as low, peak associated with various expectations
and demands. Peak season is during December when it attracts a large number of tourist than
other seasons. This increases high tourist demands (Brotherton, 2012). Marriott hotel has great
advantage of earning profits during this season by providing high quality of services.
Time/day of week- On Saturdays and Sunday hotels are fully occupied as people
generally enjoys weekends. In this case Marriott hotel may enjoy heavy demand during this time.
Economic factors- There are some national or regional issues associated with each
tourist or their spending power . In such case demand from the customers falls.
Healthy living- Many tourist are concerned about their health and choose a standard
hotel like Marriott where they can get a facilities at a standard level such as food and beverages,
sanitation, customer services. This factor leads to increase demand for tourist.
1.3 Compare customer profiles and their differing expectations and requirements in respect of
hospitality provision.
Customer preferences and expectations are varied according to their requirements,this
way customer profile for hospitality can vary. Customer profile for hotel Marriott is discussed
below-
Spending power- Families, couples, and businessman are source of income for hotels.
They need services of high standard rather focus on cost of service (Cohen and Olsen, 2013).
They are willing to spend high prices for services. Marriott hotel can take the advantage by
providing luxurious services.
Types of Hospitality business- Hospitality business is mainly concerned in providing
food and beverages and accommodation to its customers. Hotel Marriott is mainly based on
accommodation facilities of high standard where customers come to meet the purpose.
Meal experience- Menu and accommodation required by the customers is very different.
Customers ranging from vegetarian to non-vegetarian, demand changes in menu list. Marriott
hotel makes significant changes in menu list to cater the needs.

Expectation Requirements-Tourist desire changes according to their needs. Change in
demand for services like business man want conveyance facilities , families need entertainment
zones. Marriott should provide them according to their expectations. This helps them to attract
large number of customers.
1.4 Analyse factors affecting average spending power (ASP) in hospitality businesses
Average spending power in hospitality business is the decision made by customers in
pricing process between hotels and restaurants (Hoque, 2013). Factors which vary ASP are as
follows-
Size of Income- Income level of customers is directly proportional to their average
spending power. If level of income is high, average spending power of the consumer will also be
high and vice versa. Marriott hotel benefits from high income group.
Status- Customers with high status will have high spending power.This would increase
and improve purchasing power of customer.
Social/cultural influences-Social and cultural factors have great influence on average
spending power of customers. On festive season or at vacation time customer is willing to spend
more than on other days. If a tourist visits Marriott for first time its spending power is high on
food items and wants to avail all facilities.
Economic Situation- Economic situation is all about economic condition of the
customer (Köseoglu and et. al., 2013). Consumers with less economic condition will force their
hands to spend less and with high status and economic condition average spending power of the
consumer increases. Hotel Marriott is chosen by the customer with high economic status and
which requires high standard quality.
2.1 Evaluate key stages in product and service development
When any new product or service is being offered by Marriott it should initiate a plan for
the product development. This plan involves procedure of eight steps which are discussed below-

Generating idea- Marketers should carefully analyse current trends in the environment It
should also analyse internal and external environment before launching a product or a service.
Marriott if wants to develop a new service such as conveyance facilities for tourist in its hotel
firstly should scan environment to meet the needs.
Screening of ideas- The above generated idea should be screened. Viability of idea
should be screened according to best available opportunities. This way the best idea can be
selected.
Concept Development and Testing- It is a detailed strategy or the blueprint of idea
generated (Law, Buhalis and Cobanoglu, 2014). Plan is now brought to the target market and
customers are chosen to test the product. This way Marriott hotel can deliver conveyance
services at no cost to customers to know the feedback of its services.
Business Analysis-They should analyse the marketing strategies to make customers
aware about the service provided to them
Product Development This leads to final concept to develop product or service. Marriott
should develop its services fully for the tourists.
Test Marketing-This is the last step before the commercialisation of the product,
marketing program is been made and target customers are identified for evaluating the product.
Commercialisation- After product is being launched, customer feedbacks are taken into
account to make necessary changes in product.
Illustration 1: Stages of the New Product Development (NPD)
Process, 2018
(Source: Stages of the New Product Development (NPD)
Process. 2018)

Launch - This is final step when the product enters market and ready for the customers
to use. Every mistake is being rectified before the launch.
2.2 Analyse features which contribute towards customers’ perception of products and services
If Marriott hotel wants to retain large number of customers it should create a good
valuable image in minds of customer such as –
Brand Image-It should create a brand image in minds of customer by providing
appropriate and standard services to customers.
Dietary requirement-Food items include in menu list should be should be healthy and
nutritious. Proper quality of ingredients should be used to prepare food to attract large number of
customers (Leonidou and et.al., 2013). Customers are very much conscious about their health.
This facility would allow them to go to hotel gain and again.
Disabled access -Special facilities such as modified rooms for disabled, special chairs for
them can increase the demand for hotel.
Availability of resources-If there are different type of services for families, new couples,
old age people it would increase their popularity. Facilities for families would include some
game zone.
Space utilisation-Hotels should provide proper proper space for customers to let them
use, to sit and relax, to roam around in hotel campus increases the perception of the consumer.
2.3 Assess opportunities and constraints affecting product and/or service development
Opportunities helps business to grow ahead of its competitors. It also increases the profits
of business (Mok, Sparks and Kadampully, 2013). On the other hand constraints are problems
which hospitality operations to grow and also affects sales revenue and profit.
Opportunities- Marriott is a high brand hotel which attracts customers with high level of
status and income. It has various opportunities to compete against its competitors. Marriott has
changed its policy not to target only high income group of people but to target middle class family
which will able to cover larger share. It also increases its facilities to open spa, entertainment zones,
for families, made a separate floor for newly wedded couples providing special services to them
which helps the hotel to make special position in the outside environment.
Constraints- Its main problem is the high cost of services when compared with hotel Hilton
and holiday Inn. Though hotel is try its best to start giving some discounts to customers who are

trying to reach through them through make my trip.com, goibibo. This would attract customers on
the long run as well as promote these sites.
2.4 Evaluate different merchandising opportunities for hospitality products and services.
The growth of hospitality business has grown to larger extent because people started
travelling more both for recreation and business purpose (Nickson, 2013). This increases the
demand for hotel business to grow more and more and expand its opportunities.
 There are variety of travellers roaming around in the world which have different needs
according to their income. Marriott should provide wide range of services according to
income group of people. This would allow the Marriott hotel to provide services with
specific charges.
 Merchandising is also benefited according to economic situation of the traveller. If t
Marriott increases its promotion facilities it will be able to gain the merchandising
advantage. If the economic condition of the tourist are high then its merchandising
opportunities will be high.
TASK 2
3.1 Evaluate different pricing methods under hospitality operations management
Under hospitality industry there are different methods of determining price of its product
and services. In context to Hotel Marriott the major pricing considerations are discussed below
Cost oriented Pricing- This is the most simple and effective form of determining price
of its products and services based on production cost ( Pegg, Patterson and Gariddo, 2012). A
share of profit is also been included along with production cost to determine its selling price.
Marriott can take the benefit of this method by analyzing the cost of producing services and
determining how much profit it can gain .
Market oriented pricing- Under this pricing method research is conducted to analyze
the prices of competitors products, based on their pricing strategy organizations fixes prices for
its product and services.
Service Charge- This is an additional cost put upon the customer above the tariff or the
menu charge. Hotels usually charge this cost added along rates of room or food items.
Cover Charge- Amount added to the bill customers when they enters restaurants. Clubs, bars
for the service provided.

The most beneficial method for Marriott is market and cost oriented as it can compare
price of rooms and the services with Hotel Hilton and holiday inn to adjust its prices. It also
analyze its production cost to determine the price accordingly and be ahead of competitors.
Service and cover charge methods are not appropriate to gain profit, tourist get frustrated
sometimes when they are asked to pay extra besides the fixed charges.
3.2 Assess factors which affect revenue generation and profitability in hospitality operations.
Profitability in the hospitality operations is affected by revenue generating factors such as
average spending power, consumer turnover, profitability factors such as Labour intensity,
Standardisation, Elasticity of demand ( Tajeddini and Trueman, 2012). These all factors affect
the operations of the Marriott.
Labour intensity- In hospitality operations, use of labour is much more then capital. In
hotels such as Marriott workforce is required in large number to render services to customers.
Lack of labour in the Marriott would lead to few services for the customers and it becomes
difficult to attract huge audience and gain profit. High services would attract large number of
tourist and increase hotel profits.
Standardisation- Standardisation in hotel refers to healthy food menu, rooms and
sanitation should be of graded quality. Hotel Marriott should continue to maintain these features
for continuous growth of revenue as customers would visit gain and again which will increase its
profit.
Elasticity of demand- It is referred to change in quantity demanded with response to
change in price of its services. If Marriott increases the price of its services and compromising
quality, demand would decrease and it will result in heavy loss.
Average spending power- If ASP of the consumers are high they will willing spend on
the products ( Wang,Chen and Chen, 2012). In case of Marriott tourist whose ASP is high will
take benefit of the services at hotel which increases their satisfaction and helps the hotel to
generate revenue.

TASK 3
4.1 Performance measures and appraisal techniques to improve hospitality operations
management.
Performance appraisal is importantly used in organisation to measure the performance
of the employees in organisation in context to pre established criteria and organisational
objectives. Managers of Marriott should use different appraisal techniques to measure the
performance.
Sales performance- Marriott can measure its performance by analysing the net profit,
gross profit of the previous year to the current year. This way revenue can increased by
adopting certain methods to satisfy customer and gain popularity.
Developing quantitative and qualitative data- Marriott should consider qualitative
data such as customer satisfaction, quality of services, customer feedback and quantitative data
such as profit earned during the year, customers coming per month, its pricing related to
competitors. These data can help managers to improve its operations.
Speed of delivery- Marriott should consider in how much time it fulfils customer order
needs to be measured. It is very effective in measuring its performance.
External Comparison- Marriott can compare its price,service quality with those of its
competitors to known the difference between performance and to achieve desired results.
4.2 Usefulness and Drawbacks of the various quantitative and qualitative appraisal techniques
and their application to hospitality operations
Qualitative methods involves the techniques of converting data of detail description into
numerical forms. It converts data into quantifiable form for further analysis. On the other hand
quantitative data use numbers to interpret result. Hotel Marriott collects data of service quality,
customer feedback and interpret the result. This becomes difficult for the managers to interpret
the result as a whole ( Xie, Zhang and Zhang, 2014).Customer have different demand according
to their needs. When people demand change in taste of the food items, it cannot be applied to
whole tourist . This create a drawback of qualitative data.
Quantitative data on the other hand helps to make comparison between gross profits and
net profits between present and past year. This review greatly helps them to create or improve
services. When the profit of Marriott decreases it can improve its strategies to render good

quality of services to customers. It is the best technique for hospitality business to improve its
services by reviewing the data.
4.3 Apply approaches to business analysis, evaluation and planning appropriate to hospitality
operations
It is very difficult to apply approaches to hospitality operations such as services to
be offered to the customers, facilities for accommodation, food and beverage. Hotel Marriott
should adopt various approaches for the proper operation of its business.
Business Analysis- It is an approach for identifying the needs and providing
solutions to the business problems which causes change in organizational context. Hotel
Marriott applies this approach in its operations to identify problems associated with
accommodation and food items and improve its service quality to satisfy customer and earn
huge profits.
Business Evaluation- It is a set of procedures or the practices used to determine
economic value of one's own organization (Zhang, Joglekar and Verma, 2012). It determines
the price they are willing to pay or receive an effect sale of business. Marriott can apply
these approach to estimate its own production cost or to identify that customers would be
ready to pay for the services offered.
Business Planning- It is very crucial for attaining the business goals effectively. It is
blue print made by company which consist of the organization goals and strategies that
would be applied to achieve them. Marriott makes its business plan of how to cater good
quality of services to its customer. It helps them to achieve the desired targets by meeting
the demands.
These all approaches should be applied in Hotel Marriott for the effectively providing
service quality to its customers.
CONCLUSION
From the above report, it has been concluded that hospitality operations increases the
economic development of country by increasing the employment opportunities. Hotel Marriott
in hospitality operations which is a leading hotel industry in catering standard services to its
customers. This report covers the stages of developing new services and product with the help of
business planning and business evaluation approaches to effectively identify consumer needs and

provide services accordingly, further it also covers which factors which help in generating profits
and revenue for the company.

REFERENCES
Books and Journals
B. DiPietro, R., Cao, Y. and Partlow, C., 2013. Green practices in upscale foodservice
operations: Customer perceptions and purchase intentions. International Journal of
Contemporary Hospitality Management. 25(5). pp.779-796.
Boella, M. and Goss-Turner, S., 2013. Human resource management in the hospitality industry:
A guide to best practice. Routledge.
Brotherton, B. ed., 2012. International Hospitality Industry. Routledge.
Cohen, J.F. and Olsen, K., 2013. The impacts of complementary information technology
resources on the service-profit chain and competitive performance of South African
hospitality firms. International Journal of Hospitality Management. 34. pp.245-254.
Hoque, K., 2013. Human resource management in the hotel industry: Strategy, innovation and
performance. Routledge.
Köseoglu, M.A., and et. al., 2013. Linkages among business strategy, uncertainty and
performance in the hospitality industry: Evidence from an emerging economy.
International Journal of Hospitality Management. 34. pp.81-91.
Law, R., Buhalis, D. and Cobanoglu, C., 2014. Progress on information and communication
technologies in hospitality and tourism. International Journal of Contemporary
Hospitality Management. 26(5). pp.727-750.
Leonidou, L.C., and et. al., 2013. Resources and capabilities as drivers of hotel environmental
marketing strategy: Implications for competitive advantage and performance. Tourism
Management. 35. pp.94-110.
Mok, C., Sparks, B. and Kadampully, J., 2013. Service quality management in hospitality,
tourism, and leisure. Routledge.
Nickson, D., 2013. Human resource management for hospitality, tourism and events. Routledge.
Pegg, S., Patterson, I. and Gariddo, P.V., 2012. The impact of seasonality on tourism and
hospitality operations in the alpine region of New South Wales, Australia. International
Journal of Hospitality Management. 31(3). pp.659-666.
Tajeddini, K. and Trueman, M., 2012. Managing Swiss Hospitality: How cultural antecedents of
innovation and customer-oriented value systems can influence performance in the hotel
industry. International Journal of Hospitality Management. 31(4). pp.1119-1129.
Wang, C.H., Chen, K.Y. and Chen, S.C., 2012. Total quality management, market orientation
and hotel performance: The moderating effects of external environmental factors.
International Journal of Hospitality Management. 31(1). pp.119-129.
Xie, K.L., Zhang, Z. and Zhang, Z., 2014. The business value of online consumer reviews and
management response to hotel performance. International Journal of Hospitality
Management. 43. pp.1-12.
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.

Online
Stages of the New Product Development (NPD) Process. 2018. [Online]. Available
through:<http://textilelearner.blogspot.com/2013/11/stages-of-new-product-
development-npd.html>.