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Issues In Hospitality Industry

College: UK College of business and computing

Unit code: K/601/1751


INTRODUCTION

This unit introduces learners to the diversity of the hospitality industry and enables them to investigate the hospitality industry in a travel and tourism context. Learners will consider the impact of integration on the hospitality industry and the possible future implications of this in a broader context. 

Learners are provided with the opportunity to select an area of interest to design and develop in an outline format, bringing together theory and practice in the creative design of a hospitality business reflecting current trends and the needs of selected customer groups.

Aim of the unit

The aim of this unit is to enable learners to gain understanding of the role of the hospitality industry, the impact of integration, and gain skills to plan hospitality businesses. 

Learning Outcomes and assessment criteria:

1. Understand the role of the hospitality industry within the travel and tourism sector 

2. Understand the impact of integration within the hospitality industry 

3. Be able to plan the development of hospitality businesses.

Unit content:

Understand the role of the hospitality industry within the travel and tourism sector 

  1. Composition of the hospitality industry: hotels (1 star to 5 star, budget hotels, bed and breakfast); restaurants (fast food, cafes, coffee shops, mainstream, fine dining); pubs and bars (managed houses, tenanted or leased pubs, free houses); nightclubs; contract food service providers (catering outsourced to a contract food service provider); hospitality services (catering managed in-house); membership clubs; events.
  2. Travel and tourism sector: travel services; tourism services; conferences and events; visitor attractions; accommodation services; passenger transport.
  3. Interrelationships between hospitality and travel and tourism: the role of hospitality in underpinning many types of travel and tourism e.g. business travel, aviation, conferences and exhibitions, visitor attractions, theme parks.


Understand the impact of integration within the hospitality industry 

  1. Integration: history and development of horizontal and vertical integration, integration via major organisations (ownership)
  2. Impacts: fewer major organisations, reduction of independent businesses, economies of scale, control of subsectors, increase in market share, standardisation, improved quality
  3. Implications:importance of branding and pricing policies, independent establishments joining associations to compete with the larger organisations, control and manipulation of the market, increased globalisation of the industry.

3. Be able to plan the development of hospitality businesses.           

  • Development: concept, market research, target market, location, scale, funding, products and services e.g. menu, licensing.
  • Design:ambiance, culture, brand, interior, exterior, functional areas, customer flows; link to target market, customers with individual needs.
  • Operation: staffing by functional areas, specialist qualifications, staffing issues related to seasonality, compliance with legislation, promotional activities, pricing.

Answer

Task 1

Introduction

Hospitality industry is one of the most integral parts of travel and tourism sector as it influences the tourists’ experience. Evidently, advanced hospitality services often enhance the experiences of the visitors. Travelling is one of the major outcomes that indicate the success of travel and tourism sector. As a junior Consultant with PKF hotel experts it is important to identify the importance of the hospitality industry in enhancing the experience of the tourists. In this report the interrelationships between the hospitality and wider travel and tourism industry has been evaluated and analyzed.


Interrelationships between hospitality and wider travel and tourism businesses

The experts of the travel and tourism sector have often acknowledged that hospitality organizations are few of the most potent service providers to the travel and tourism industry. Tourists and visitors spend a significant portion of time in the hotel or restaurants and other hospitality services whether they are travelling for business purposes or for leisure. 


Business travelling 

In business travelling the people who travel for business purpose they opt for hotels which is near to their office and has all the facilities that they will require for their business trip.  The necessary things of requirement for business travelling are business centers, Wi-Fi or internet cable to access internet, conference areas, meeting rooms. Apart from these, the people who are travelling for business purpose they also need the facility of 24 hours laundry and dry cleaning. The hotels must also have pool, spa and gym so that they the traveler can relax after meetings and conferences (Medlik, 2012). The business people try to search for hotels that have restaurant facility and serve good food and hospitality to impress the clients or the business associates. Due to increase in the globalization, the purpose of business travel has increased. People has started to expand business globally for which they have to travel from place to place which has given the purpose of business travel and the hospitality has changed according to the purpose of the travel. 


Conference and exhibition

In conference and exhibition, hospitality is required in the travel and tourism industry. When a company is organizing a conference or an exhibition then lot of people are invited. To host the conference or the exhibition it is very important that the hotel have a very good hospitality. To serve the visitors and the attending without irritation is very much needed for a hotel. The attendees of the conference are always hosted properly as this is the work of the hotels to provide them with comfort and easiness (Ip et al. 2011). The exhibitions which provides deals for the travelers and tourist attracts may visitors who are been hosted by the hotels. These types of events and exhibitions attract lot of people and this has helped the hospitality industry of travel and tourist to benefit from such events. 


Visitor attractions

Visitor attraction is that when anything that attracts a visitor and the traveler wants to visit the particular place. Attracts can be anything manmade or natural for example manmade can be theme parks, museums, etc. and on the other hand the natural attractions are natural parks or sea areas, hills, etc. some of the time it happens that visitors listen about places and see pictures of the place that attracts the travelers. Visitor has attracted places helps in increasing the business of the travel and tourism sector and the hospitality of this sector increase with the increase in the visitors.A theme park attracts lot of visitors and this needed dedication towards the visitors so people keep coming to the place. Moreover, this can only happen when the hotel that is the host of the theme park provides with proper hospitality and behavior towards the visitors. 


Package holidays

Hospitality plays an important role in the packaged holidays. Packaged holidays which is one of the major areas of tourism industry, serves as an important instrument in the profitability of the industry.Accommodations are included in the package holidays but package holidays mostly depend on the budget of the package as well. Popular holiday packages become successful because of their comfortable accommodation and transportation offerings. The luxury and the comfort of the accommodation significantly attract the tourists in the visitors in any hotel or motel. For the premium prices the guests prefers the best services and benefits. Holiday packages are most of the times mass purchased and customers seek preference from the benefits offered by the hotels (Sigala et al. 2012). The contracted travel agents often offer special rates to the customers availing the packaged holidays.


It is important for the travel agents who offer packaged holidays to opt for better hospitality services. As per recent studies, it has been found that the customers who prefer to avail the packaged holidays can be classified into two groups. One group of clients prefer holiday packages that offer better accommodation and transportation and the other group solely concentrates on the accommodation, food and resorts that are included in the packages (Ayeh et al. 2012). It is important for the travel agents to check whether the clients are having a comfortable hospitality or not especially in the package holidays as most of the package holidays are bought by people who are travelling in a group. Therefore, individual needs and requirements become important for the agents to look after, as they are entirely responsible for the customer experiences in this case. Therefore, it is important for them to choose their hospitality collaborates wisely who can offer them packages of various price ranges.


Task 2:

Understanding the impact of integration, within hospitality industry

Integration is considered one of the intrinsic properties, which are essential for the growth of a particular business. It is important to note that, the very term integration refers to the combination of activities. These activities are namely management of business process along with the improvement of operational efficiency of a company in the hospitality industry. 


2.1 Analysis of the implications of integration at Marriot International

Security

The term security in this aspect refers to securing the resources and data of the hotel while the authority is integrating vertically or horizontally. It is important to speculate the accessibility of the data of the hotel needs proper monitoring in order to avoid any sort of issues or problems in the near future. Marriott tends to use varied security processes in their organisation in order to avoid the exposure of the account data as well as other data in the hotel premises. One of the predominant security systems that are used by the hotel is the usage of an access control system, which is characterised with an alarm processing along with photo-badging system. Furthermore, it also contains definite functioning systems, which facilitates the authority in gaining access to the database of the company. It tends to control the accessibility of the company database to those employees, who do not have the permission to access the data. However, this is an effective method, which is used by Marriot International, and need to be implemented in order to maintain the security of the data of the hotel authority (Kandampully et al. 2015).


Mismanagement

It has often been found that due to the presence of integration in the hotel premises, the roles and responsibilities of the managerial authority of the organisation tends to increase. Furthermore, it can also be stated that, the term mismanagement itself portrays the inner meaning of the word, which is often coined by the employees and subordinate members of any organisation. This is because, when many employees tend to work together, it is likely to happen that the company or a business organisation will face an initial mismanagement within the premises of the hotel organisation. On the other hand, it is also to be stated that, mismanagement often occurs due to the inadequacy of the efficient resources, which tends to hinder the business process and the growth of business in a hotel organisation. Thus, it can be stated that, integration leads to certain changes in the structure of the company. It is the duty of the leaders of the Marriott International, to be focused on the goals and objectives that are initially projected within the premises of the hotel organisation.


Cultural disruption in the organisation

The organisational culture in an organisation plays an important role in the growth of business. On the other hand, it is also important to note that, the working environment of an organisation needs to be proper and accurate in order to maintain a healthy environment within the premises of the hotel. In the context of Marriott International, it can be well presumed that, it is due to the presence of integration, that the organisation goes through several changes and it has often been found that the entire business process often is hampered. Thus, it has been found that, due to this aspect, it tends to interfere with the beliefs and cultures of the employees of the company (Eid, 2014).


2.2 Discussions on the extent of integration affecting hospitality business at Marriot International

In the context of Marriot International, it can be well presumed that, they have undertaken the provisions of integration, which, according to them is an essential necessity in their hotel. However, it has been found that, integration is often both a necessity and challenge for the hospitality industry. Therefore, the impacts are as follows:


Risk

The issues and the potential risks, which are closely associated with integration, are associated with the security and accessibility of the confidential database of the company (Wang et al. 2014). However, in the context of Marriott international, it can be well presumed that, it leads to the disturbance in the working procedure of the company.


Barriers in the competitive entry

It has often been found that the aspect of integration acts as a potential barrier in the entry of the competitors. Thus, it can be propagated that, it acts as a factor, which adds strength as well as brand image in the customer loyalty of the company (Neuhofer et al. 2015).


Task 3

As a junior consultant of APK, I am liable to choose an area of study, which the line manager wants me to look into. The hospitality business pays more attention to details that customers would wish to be cared for. As a consultant, I am destined to understand the needs of the customers and cater to their basic needs. A hotel or accommodation service provider wishes to understand the specific needs of the different types of customers it caters to. Thus a business organization who wishes to engage and target more and more customers into the accommodating them should adhere to stricter rules in its administration and make sure that its employee base follows the same; customer satisfaction and retaining them is the primary objective (Keller, 2017). 


3.1 Rationale for a selected project clearly justifying decisions linked to target market.

Out of the various options that require my intervention and thorough understanding, i choose to pay more attention to the hotel and accommodation division. As a thumb rule, i should be able to identify the target customers and understand their basic requirements before I dive right into gaining their trust. An accommodation company should be able to house more number of customers. Although the number of rooms and housing options are limited, an able administration and a thorough planning should aid in a perfect resource allocation. Consider the peak seasons that the hotel or the accommodation service ponders on. Particularly during Christmas or other festive seasons, it might not be possible for them to allocate rooms for all the customers willing to take shelter. The key is to provide them an affordable accommodation with features and amenities that would maximize their utility in the given time period (Lützner  et al 2016). 


As the consultant of such a respectable institution, the aim of the administration, I think should be to keep no one waiting but data from the net footfall during peak seasons in particular shows that the management had to reply in the negative on being asked about availability. Apart from special occasions, it remains filled more or less all the year round. From leisure travelers to business meetings, the company even caters to groups or local tours. Reservations for room booking are facilitated through different ways. Very recently, the company has also initiated and given special attention to online booking. The dedicated website and the online Smartphone application has been created to meet the needs of the customers and make them aware of the list of services provided. It also lets them book their rooms online based on availability; plus it also operates its restaurants and in house bars, bookings for which are also done online. As a consultant and the manager of the in house affairs, I am determined to look after the functioning of the web designers and content developers so that only the finest content goes online. 


Hotels and accommodation companies pose no constraints as to the type of guests it serves. Leisure travelers who may be moving from one part of Europe to another take shelter in this luxury hotel and try enjoying the city (van Dijk  et al 2016). 


The accommodation company provides all the basic amenities, therefore it is even wiser to relax and let the journey receive a boost. Likewise, data reveals that the accommodation company housed nearly 8 business meetings within a span of 4 months. This is enough to prove that business organizations prefer to hold their meetings and discussions in a pretty and affordable location. Plus the hotel offers enough communication facilities like online connectivity and TVs. It also houses large groups or tourists who are willing to spend their time in the city before moving on to other locations. Offers like special discounts and complimentary amenities help them make their choice. Apart from this, the company also houses and has enough infrastructures for housing differently able-d people. List of decisions that I have decided to undertake in the recent future:


  • Make plans for further investments: Highlighting one of the major issues that hotels and accommodation services face is insufficiency of rooms. Replies in the negative create a negative impact and the organization might not be able to retain its customers. Hence, I plan to write a report to the authorities to direct a part of their profits in reinvesting for increasing the number of rooms available (Aarikka-Stenroos  et al 2014).  
  • Proper allocation of rooms and accommodation: Room allocation should have to be done keeping in mind the number of customers willing to reside, number of days they are willing to spend their time there and responding to customer’s specific needs and requirements. 
  • Guiding the staff and employers in regular basis: To generate enough enthusiasm among the employee base, team leaders and management should take relevant steps to guide them. Knowledge on their specific work function, understanding the needs of the institution and aiming to retain customers should have to be undertaken by the employees. It is the duty of the leaders to present a guideline that would allow them to react to emergencies and meet the needs of the institution (Jaggi  et al  2013) 
  • Enhance the condition of the amenities that the hotel has in store: With competition gaining grounds, the hotel administration should give more stress to add more facilities and amenities so that customers cannot resist staying there. Thanks to technological development, all our rooms are well equipped with television sets and we have free internet services for all room types.  
  • Produce enough motivation among the employees: Motivation in the form of monetary compensation and liberating the enthusiasm for producing quality services is mandatory for running the hotel. Competent leaders experienced in the relevant field should take the responsibility and should be able enough to handle his team single handedly. 


3.2 Plan for transforming operational requirements:

Chalking out a plan for the smoother functioning of the hotel requires the administration to consult the administrative department and the respective team leaders to identify the issues and solve them with immediate effect. As a consultant, I am destined to make a thorough planning of the scenarios that may arise. I would like to draw the attention of the HR department and make them understand the precise organizational requirements so that the hired staff are capable enough to meet the organizational requirements. Here are some of the points that require thorough understanding:


Inhabitation targets: The Company wishes to retain 60% occupancy throughout the year to keep its profit margin within a desirable limit. An organization normally faces two types of costs while operating. Fixed costs or investments are those, which are incurred even when the organization is not producing anything. Consider the payment of wages and salaries of employees from higher designations. Variable costs change as the company starts producing. So to keep its costs under control and still break even it with its received revenues (if not earning supernormal profits), the company has to maintain a definite occupancy rate throughout the year (Sabou  et al  2015). 


Net earnings objectives: In a highly competitive environment, it is difficult to alter prices at one’s will. So maximizing sales helps, the companies retain its revenue objectives. The company uses the revenue to hire more staff, pay salaries and wages to the existing workforce, and maintain supply of the amenities, which includes internet services for example. A part of the revenue received is also kept as surplus over the costs incurred and that may be utilized for re-investment and generating more revenue. 


Retaining in-house staff over outsourcing them: In-house staff refers to the workforce that aids in the normal functioning of the hotel or the accommodation facility. In general, companies prefer keeping their own in-house staff base as one of the primitive methods of maintaining a decent workforce. While it’s the duty of the HR manager to hire the most talented and hardworking professionals, it is the duty of the latter to invest their knowledge for the organization. Since they are working in a single premise, problems and glitches can be easily catered to. Outsourcing them adds more stakeholders of the organization profit sharing and the time gap between calling them and getting their job done may not be beneficial if the hotel wishes to retain its customers.


Inter-departmental relations: Like any other orientation, the internal or in-house staff works as a team thus catering to a common cause. They are more efficient and are liable to follow employer’s rules. However, it gives them a platform to raise a voice in case a client misbehaves for example so that action may be taken against. A combination of in-house and outsourced employees or them alone might pose potential threats because of the communication barriers faced by either staff groups. In house staff may be successful in improving the mechanisms, adhering to which the company is functioning even better. Outsourced staff might not be sincere in their effort to enhance the wellbeing and profit structure if the organization. Thus, in house staff creates more impact than outsourced ones (Janssen et al 2017). 


Conclusion

Identification of several sectors in the travel and tourism industry and their dependence on the hospitality services potently portrays the necessity of good hospitality services in travel and tourism industry. It is a prevalent and evident fact that better hospitality is one of the potent factors that enhances the customer experience and thus it can be concluded that the success of the  wider travel and tourism industry is very much dependant on several variables of the hospitality industry.

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