BTECH HND IN TRAVEL AND TOURISM MANAGEMENT
UNIT-13: HOSPITALITY MANAGEMENT
Tourism is vital to the economies of most countries worldwide (Abrahams, 2006).Trends in global tourism have shifted remarkably over the last decade. Information technology supports the increased sophistication of travellers (Chen and Sheldon 1997), who seek greater variety in their travel arrangements and expect personalized services that meet their unique needs (Sheldon 1993). Previously, travellers received information about destinations through books, brochures, promotional videos, word-of-mouth, travel agents or tourist offices.
Tour operators create, arrange and operate tailor-made tours and travel programmes which they market to the customer either through travel agencies or directly via websites, TV adverts and call centres. There are four major players dominate the outbound sector. Leisure is big business. The leisure industry encompasses sport and recreation, health and fitness, betting and gambling. Whether you want to spend your relaxation time actively - by going to the gym, playing your favourite sport, visiting your local theme park, or passively - at the cinema, the bingo hall, or the casino, the leisure industry can cater for your every mood.
Intercontinental park lane London is one of the most prestigious outlet of world first hotel brand? Intercontinental hotels and resorts. The brand is being introduced as international hotels corporation on 4th of April in 1946. For the sake of worldwide development the name was changed as intercontinental hotels corporation in1947 and started voyage from Belem, Brazil in 1949. In 1963 they open four outlets in Europe within a two weeks time and introduced the six continental clubs for recognition guests which is first in the industry. Moreover, in 2006, they spend approximately £76m for the refurbishment of intercontinental park lane London. The Intercontinental Hotel Park Lane stands in an enviable location, on the edge of Mayfair, opposite Hyde Park and right next to Hyde Park Corner. On the opposite side of Hyde Park Corner are Green Park and the grounds of Buckingham Palace.
Surrounding areas of the hotel
The intercontinental follow the policy to greet the guest as soon as they enter and do help whatever you need like any guide line for shopping. Eight rooms have been adapted for accessibility. Room configurations include sixty suites (the largest suit in Europe), two hundred singles, one hundred and eighty seven doubles and two hundred and ten rooms that are non-smoking. Room service is 24 hours and there is a daily maid service. The hotel sates their own restaurant namely Theo Randall at the name of its head chef who used to work in River cafe is been selected once the best Italian restaurant in Europe. What is more, the guest capacity of the restaurant is 120 people. There is a bar of 20 seats capacity which is part of the restaurant.
The most common definition, by the World Tourism Organization (WTO), refers to the category of ‘hotels and similar establishments’ thus: . . . are typified as being arranged in rooms, in number exceeding a specified minimum; as coming under a common management; as providing certain services, including room service, daily bed-making and cleaning of sanitary facilities. The demand for accommodation has developed in response to the rapid advances in transportation, with both business and recreational travel expanding at a phenomenal rate throughout the twentieth century.
Hotels in appropriate locations have developed their goods and services and product to capture the lucrative business market, which sustains high room rates and high profit margins. The executive requires quality accommodation, with private bathroom facilities, telephone and an area for working. The pleasure tourist is more price/sensitive, as visitors are paying from their own pocket and are sensitive to economic conditions at both the point of origin and the point of destination.
1.1 Hospitality outlets:
Usually the owners themselves prepare the breakfast and clean the room etc., but some bed and breakfasts hire staff for cleaning or cooking. Although some bed and breakfast owners hire professional staff, a property which hires professional management is usually no longer considered a bed and breakfast, but enters the category of inn or hotel. In recent years B&Bs in the UK have struggled against budget hotel chains such as Premier Inn and Travelodge. However, in holiday areas the B&B and guest house still prevail. Unlike the hotel chains, they provide a more comprehensive service and breakfast is included in the price, and some who stay regularly may simply like knowing their hosts. The travel and tourism industry is volatile, affected by worldwide events.
Hospitality Operations in Travel & Tourism
Hospitality is an important element of travel and tourism. The World Tourism Organization defines tourists as people who "travel to and stay in places outside their usual environment for more than twenty-four hours and not more than one consecutive year for leisure, business and other purposes not related to the exercise of an activity remunerated from within the place visited." The provision of food and beverage by travel and tourism organizations has also become important as they seek to maximize profits, so many attractions and transport operators now have catering provision. The hospitality products and services of a travel and tourism organization can be of equal importance to the customer as their core travel and tourism products and services. You will get to know the wide range of hospitality providers within the travel and tourism industry.
1.2 Interrelationship with hospitality organisation and travel and tourism organisation:
Intercontinental hotels and resorts are related with lots of travel and tourism agencies more importantly with the air lines. Priority club reward members if they are also member of partner airline frequent flyer programme, they may choose to earn miles instead to points for every qualifying stay. The co-ordinated air lines are, Aeromexico, Alaska airline, American airline, Air Canada aeroplane, Air France, Air Berlin, Nippon airways, Asian airlines, Brussels Airlines, china Airlines, Emirates airways, Gulf Airways, Japan Airlines, Jet airways, KLM, Korean Air, Saudi Arabian Airlines, Singapore Airlines, South African Airways, Thai Airways, southwest Airlines, British Airways, Malaysia Airlines, Qantas , Alitalia, etc.
For example, one can earn 1000 Velocity points for one qualifying stay at intercontinental hotels and resorts, 800 Velocity points for one qualifying stay at crown plaza hotels and resorts and hotel indigo, 600 velocity points per qualifying stay at Holiday inn, 400 Velocity points at holiday inn express.
2.1 Level of integration:
The main trends in the industry are economies of scale and vertical integration. Through these strategies tour-operators can achieve enormous buying power and considerable control over the supply and distribution of their products.
Integration refers to long-run decision-making by a producer, which is likely to concentrate on three main areas. Firstly, the opportunity for economies of scale (from horizontal integration); secondly, the ability to control and develop inputs and markets more closely (from vertical integration); and thirdly, the chance to use existing differential advantages to operate profitably in related fields (diagonal integration). The two main forms of integration, horizontal and vertical integration, practised in the tourism industry will be discussed here.
1 Vertical and Horizontal Integration
Vertical integration implies the take over or formation of businesses at different levels of the supply or distribution chain. For a tour operator this means investment into either suppliers (through backward integration e.g. accommodation, transport) or distributors (through forward integration i.e. travel agents). The main advantages are control over supplies in terms of quality, availability, access and price, and the ability to reach consumers. Vertical integration is a significant feature among the leading tour operators and has drastically increased in recent years. Prior to the late 1980s only the Thomson Travel Group among today's leading companies had been fully vertically integrated with the purchase of its airline Britannia in 1965 and the travel agent chain Lunn Poly in 1972. Today, the four main operators are all vertically integrated.
Horizontal integration refers to a situation when producers join with the aim to remove competition, to increase economies of scale, and to increase purchasing power. Horizontal integration comprises mergers at one level in the tourism distribution or supply chain, i.e. mergers between different tour operating companies.
Integration strategies have led to increased concentration among tour operators which is shown in the number of ATOL registrations during the past years (see figure 9). Between 1996 and 2000 the number of passengers carried by ATOL holders increased by 32.9%, to 27.5 million, while the number of ABTA registered tour operators increased by only 7.9% (Mintel 2001a). That is a strongly increasing number of customers are flying out using a proportionally decreasing number of tour operators. At the moment a merger between Airtours (renamed Mytravel in 2002) and First Choice is the topic of discussion. Another example of pan-European integration is the German C&N Touristik, a company jointly owned by Lufthansa and the department store Karstadt/Quelle. It is the second largest European travel company and owns the Thomas Cook group.
2.2 IMPLICATION OF INTREGRATION:
The nature of the tourism product, i.e. the integration of various sectors of the tourism industry (transport, accommodation, catering and entertainment), make this industry an obvious target for corporate concentration (Lafferty and van Fossen 2001).
Many industry observers argue that today’s tourism customers have matured and are demanding new experiences. Competition increased sharply for destinations world-wide, and also for customers’ time and money. While integration offers large tour operators cost savings in booking facilities, hotel rates, transfers, accounting, and in marketing, it also has a fundamental impact on the way in which independent tour operators operate. The effect is that vertically integrated operators capture a large proportion of mainstream package holidays, while independent operators increasingly focus on specialisation. The tour operating sector is essentially polarised: a very small number of big companies and a very large number of small ones - the middle level of medium size companies offering the 4S product has been absorbed by the larger players.
2 Benefits of global branding
Brand is the personality that identifies a product, service or company (name, term, sign, symbol, or design, or combination of them) and how it relates to key constituencies: Customers, Staff, Partners, Investors etc. Careful brand management seeks to make the product or services relevant to the target audience.
In addition to taking advantage of the outstanding growth opportunities, the following drives the increasing interest in taking brands global: Economies of scale ; Lower marketing costs; Laying the groundwork for future extensions worldwide; Maintaining consistent brand imagery ; Quicker identification and integration of innovations; Preempting international competitors from entering domestic markets or locking you out of other geographic markets; Increasing international media reach is an enabler; and Increases in international business and tourism are also enablers.
Managers need demand schedules in order to determine prices based on demand. Using demand schedules, managers can figure out which production and sales levels would be the most profitable. The prices are determined by considering the cost estimates at different sales levels and expected revenues from sales volumes associated with projected prices. Managers need demand schedules in order to determine prices based on demand.
The success of this strategy depends on the reliability of demand estimates. Hence, the crucial obstacle managers face with this approach is accurately gauging demand, which requires extensive knowledge of the manifold market factors that may have an impact on the number of products sold. For example, if a Company A sets its prices above those of its competitors, the higher price could suggest that Company A's products or services are superior in quality. Harley Davidson used this with great success.
Successful entrepreneurship depends on many factors, including the characteristics of the entrepreneur and the entrepreneur's economic environment. The person who has the ideas, the energy, and the vision to create a new business is the cornerstone of any start-up. But the individual must have ready access to a variety of important resources in order to make the new venture more than just a good idea. They need to put together a team of talented, experienced individuals to help manage the new venture's operations. In short, entrepreneurship is a process that involves planning, implementation, and management as well as the cooperation of others in order to exploit an opportunity for profit.
One of the most vexing situations entrepreneurs face is the allocation of scarce resources. Entrepreneurs bank their businesses on their ability to make do with the limited resources available to them.
In addition to being creative, an entrepreneur must be able to tolerate the ambiguity and uncertainty that characterize the first years of a new organization.
2.3 Explain how integration has affected a hospitality organization.
Multinational hotel companies will also want the same organizational culture to be reflected across all of their properties worldwide, and so they introduce training schemes and systems that not only ensure uniform quality service across the properties but also shared values and attitudes to work and the company. This culture training is designed to change people’s attitudes, not the organization structure. This also assists in moving staff around their properties. Employees know that wherever they are moved within an organization there will not only be shared hard systems (financial control, reservations, etc.) but also shared values and working culture.
Organizational culture and climate are different, but related. Climate is a sharing of perceptions of the intangibles of the internal or real environment of the occupational community (i.e. both the small workgroup, such as chefs, and the larger workgroup, as in all the employees of the hotel), while culture is the values and assumptions of the ideal environment that management hopes will be instilled into all employees. Thus culture informs climate.
3.1 Develop a rationale for the project clearly justifying decisions linked to target market.
Defining your target market helps you decide where to commit resources and what kinds of promotional methods and messages to use. Customers can be identified according to their social demographics and geographic location. This information enables you to determine your market share and your most likely potential customers. A customer- oriented marketing style will capture a greater market share than one centered on just the product or service. Understanding the difference between wants and needs will help you prepare a focused plan. For example, if the need is transportation, the want - the specific vehicle desired - may be affected by the person’s cultural, economic, and geographic environment.
3.2 Design the interior and exterior of a hospitality outlet.
InterContinental is the world's first truly global brand that has put the knowledge and understanding of each destination at the core of its business. The brand is deeply rooted in a mosaic of cultures and landscapes that define our world. Thanks to its unique heritage, InterContinental is able to go out of its way to enrich guest stays with authentic experiences that make their world feel bigger. To fulfill this promise, the brand launched a program to encourage the sharing of local knowledge so guests get more out of their stay.
Contemporary style in the heart of Mayfair once the site of a royal residence, InterContinental London Park Lane is now the epitome of modern elegance. Located between Mayfair and Knightsbridge in view of Buckingham Palace, the hotel is not far from the Tower of London, Big Ben and Trafalgar Square. Also worth seeing is the Victoria and Albert Museum, Madame Tussauds and The National Portrait Gallery.
3.3 Explain the operational requirements of the proposed hospitality outlet's organizational structure in relation to human resource allocation.
Management comprises planning, organizing, staffing, leading or directing, and controlling an organization (a group of one or more people or entities) or effort for the purpose of accomplishing a goal. In some cases, management has even rewarded itself with bonuses when lower level employees have been laid off. Human resources is also the name of the function within an organization charged with the overall responsibility for implementing strategies and policies relating to the management of individuals (i.e. the human resources).
HR function is to implement an organization's human resource requirements effectively, taking into account federal, state and local labor laws and regulations; ethical business practices; and net cost, in a manner that maximizes, as far as possible, employee motivation, commitment and productivity. HRD framework views employees as an asset to the enterprise, whose value is enhanced by development, "Its primary focus is on growth and employee development…it emphasizes developing individual potential and skills".
The industry is, therefore, making a concerted effort to build up programs for sustainable development. However, it cannot do this alone. If Travel & Tourism is to continue to flourish and to contribute to sustainable development, it needs help from national Governments. This assistance is needed in two forms: - both positive encouragement for sustainable tourism initiatives and an understanding that policy decisions in other areas can effect Travel & Tourism.Loading...
Martin K. Perry. "Vertical Integration: Determinants and Effects". Chapter 4 in: Handbook of Industrial Organization. North Holland, 1988.
Joseph R. Conlin. "The American Past: A Survey of American History". Chapter 27 page 457 under "VERTICAL INTEGRATION". Thompson Wadsworth. Belmont, CA, 2007.