This UKCBC Hospitality Provision Assignment is given in UK college of business and computing, describes about the major part of hospitality industry.
Hospitality sector or hospitality industry is one of the major parts of service or tertiary industry. Service industry is the one in which no goods are produced; It is intangible people can only consume or feel the experience but can’t own a service. There are few booming sectors in service industry like Software or IT sector, Aviation industries etc., and one of the important is Hospitality as it includes so many small sectors like Event management, talent management, Lodging, Restaurants, Theme parks, Transportation and many more (Barrows, 2011). With the mentioned services it supports one of the most important and nowadays most booming is Travel & Tourism. In this world of technology, people are more aware of new adventurous places, also many countries are supporting tourism more as it is becoming one of the biggest sources of revenue as well as employment. So, in this report we will see how hospitality and travel & tourism are interrelated to each other. Also we will look how integration plays an important role in making business strategies what are its impacts. Finally, a business plan for opening a new organization in this sector.
Task 1: Using example of at least two hospitality sector of your choice and discuss the interrelationships between hospitality and wider travel and tourism businesses. Make sure you provide a description of your chosen organisations, their business, products & services
P 1 Understand the role of the hospitality industry within the travel and tourism sector
1.1 Discuss the interrelationship between hospitality and wider travel and tourism
Tourism can be defined as a travel by a person for recreational, business or leisure purposes for a specific period (Cook, HSU & Marqua, 2013). Tourism can be stated as a different field altogether but if we look inside, Tourism can be sub divided into small business sectors which is being catered by Hospitality sector only. For ex. A family goes for a recreational tour, if they travel by an airline; the service provided by airlines comes under hospitality. They stay in a hotel; services provided by the hotel come under hospitality. They go for recreational activities; again the services provided by the operator come under hospitality. So, overall we can say that tourism industry is made up of small sectors from hospitality industry or it can be said that hospitality industry acts as a supplier to tourism industry. Now we will look more into basics to understand what is meant by hospitality & what does travel & tourism stand for.Any act of helping or any action of being hospitable can be stated as Hospitality, now we can look into direct examples such as ‘Hotel’, ‘Restaurants’ here the employees help the customers by providing the room divisions operations service, serving food, guiding them etc. On the other hand tourism is a travel for business, leisure & recreational. But it can understood quietly easily that tourism is incomplete without services like ‘Hotels’ & ‘Restaurants’, which belongs to hospitality sector, so it can concluded that hospitality sector acts as supplier for tourism (Walker, 2012) and it helps the travel & tourism industry to flourish because it can be stated that a person who is travel for his enjoyment would require facilities like leisure, entertainment, food & beverage, accommodation etc. as he is travel away from his regular life to get some refreshment, to change his state of mind, so people would be looking for the good services as mentioned earlier and those are provided by hospitality sector only. Some organizations have started their business with one motive that is to synchronize these two industries together. For example, organizations like Thomas cook take care of everything starting from travelling to staying to eating to deciding what activities to be done. They name it as packages where it is pre-decided by the company what a person or group of people will do when they are on a tour.
Hospitality industry makes sure that the tourists (mostly first timers) are comfortable and are enjoying their stay. Now this includes almost everything like providing safe environment for all, serving of food which is healthy as well as hygienic. Also to take care of people who get over drunk and can create nuisance for all. Overall motive or aim of service industry is to make the experience for the customer as good as possible whether he is having coffee or food, or traveling or whatever service the person is using, he needs to be happy & satisfied. If a person gets personal attention and he is happy & satisfied with the service provide chances are that not only he will become your repeat customer but also he can help in increasing your revenue by promoting your good work by word of mouth marketing. So it is really very important for the service providers to employ and train people well so that they can handle customer very nicely. Employees such as driver, guide, receptionist, waiters should be trained so well that they deal will all customers nicely & politely. They need to treat them equally and give them respect. Each and every thing whether small or big should be taken care on time because customers would understandably want to reap the benefits offered by their service providers, particularly for the premium prices paid.
Now we will study and look at the two organizations from hospitality sector which will help us to understand how hospitality management & travel-tourismis related to each other.
- The Taj Hotels Resorts & Palaces
The Indian Hotels Company Limited (IHCL) and its subsidiaries are collectively known as Taj Hotels Resorts and Palaces and it is one of Asia’s largest & finest hotel companies which was started by Mr Jasetji N. Tata as The Taj Mahal Palace Hotel, Bombay in 1903. It defines the Indian hospitality also they have completed its centenary year in 2003.
It comprises of 93 hotels in 55 locations across India with additional 16 international hotels in the Maldives, Malaysia, Australia, UK, USA, Bhutan, Sri Lanka, Africa and the Middle East.
IHCL operate in the luxury, premium, mid-market and value segments of the market.
Taj’s motive is to infuse a sense of Indian heritage and culture within each diverse property. In last many years the Taj has won international acclaim for its quality services of hotels. At Taj luxurious living and fine dining find common ground.
Products and Services Offered by The Taj.
Following are some of the products and services offered by them:
- They have around 110 hotels, palaces worldwide they provide world class facilities in terms of accommodation; food etc.
- People who visit for business purposes, for them it also provide facility to arrange meeting and events in its premise. Many corporates use this facility to organize their meeting and events.
- Weddings at Taj have always been special with its beautiful locations all around the world.
- They have Spa facility also available in their hotel by the name of “Jiva spa”.
- They have services like courier, child care, and laundry, pet care etc. as well.
- Facilities like internet, wake up call, travel desk &babysitting are also available.
- There are facilities like maid service, gift shop, florist & barber shop as well which are available at some locations.
- Make my trip
Make my trip started in 2000 by Mr Deep Kalra is one of the known companies in tour and travel industry in India. It is also listed on New York Stock Exchange. Currently having around 1000 employees it operates from 59 retails stores in 37 cities all over India. They have done few mergers with companies from outside India to make themselves stronger in this industry. They have headquarters in Gurgaon, India; New York, US; & Sydney, Australia. They have strong online portal through which they offer reservation of rail tickets, airline tickets, bus tickets and holiday packages.
Following are some of the products and services provided by the organization:
- Make my trip is operating in tour operations.
- They provide reservation tickets for Airline, railways & bus.
- They provide holiday packages for its customers.
- They also provide the hotel services to its customers by collaborating with major companies in hotel industry in India.
- In year 2010, they also started the cab service that is they help you in booking a Cab.
Task 2: In this task you will discuss the issues of integration in hospitality. You are to analyse the implications of integration to the hospitality industry and discuss how integration has affected an actual hospitality business (use example of your chosen hospitality organization to support your answer)
P 2 Understand the impact of integration within the hospitality industry
The concept of integration is not new and businesses have been using this concept from more than a century. Usually organizations go for this when they focus on reaching economics of scale so that they can lower their operating cost. This can be done if the organization think they do not need outsourcing any more, therefore can save money in long term. Integration can be of two types: -
Vertical Integration: - When an organization buys its suppliers or buys another company in distribution chain, it is called as vertical integration (Kotler, 2010). This result in lowering the operating cost and hence will maximize the profit. For example Carnegie Steel manufacturing company in the United States, they have complete control over the distribution chain. So, the company placed economies of scale at the top of its agenda, and focused training people internally rather than employing outsiders
Horizontal integration :- When organizations, from two different industries come together to form a new bigger organization it is said horizontal integration (Kotler, 2010). This results in expanding the customer base, benefit from economies of scale and finally maximizing the profitability.
For Example, Hilton hotels international purchased a hotel at the Walt Disney World Resort for €92,202,465.
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2.1 Analyse the implications of Integration in Hospitality Industry
Following are the major implications of integration in hospitality industry: -
- It is really important that the services provided by the company remains same at all places, anything less would not acceptable and will harm its reputation. For example if Hilton hotels have bought some XYZ hotel in some other city, it is really important that the services provided in that XYZ hotel should be same as in any Hilton hotel. This is the power of brand name and value which has been earned by Hilton so to keep it high it has to make sure people feel and experience the same service as in any other hotel of Hilton.
- When there is integration between two big organizations, it can have bad effect on the society;if two strong people merge together there is obviously problem for smaller organizations because in any business only best can survive and if two big companies are together then there is a big problem for smaller organization. This may result in throwing those smaller organizations out of the industry, hence leaving many people unemployed.
- Integration can lead into conflicts of interest as well. For example both organization who are joining hands together have different vision & mission for their business which can create some conflicts among them and hence can affect the decision making process.
- Globalization has a very big effect on this industry. As travel rules have been relaxed in many countries and knowing that tourism is one of very important revenue generator, countries are encouraging it. This has encouraged the organizations to think globally and expand worldwide. International tourists bring more revenue as compared to the local tourists (Sharpley, 2006).
2.2 discuss how integration has affected a hospitality business
Impacts of integration process are as follows:
- The most important advantage which integration provides is competitive advantage. Combining core competencies of two good companies will help a lot in satisfying and attracting more customers.
- Monopoly can created by providing the best which is not available easily with everyone by doing this the company will be having more dominant nature in the market. This will also reduce the number of choices for customer.
- The most important and required impact would that the economies of scale can be achieved with the help of integration. This will reduce the operating cost and hence profitability can be maximized.
- By following any integration or both integration, the cost can be reduced which helps in increasing the profit.
- It will help in diversifying the business in other countries. They can offer new services and hence can increase the customer base which in turn will increase the profit.
Task 3: For this task, you need to be creative and present your own original ideas, as well as demonstrating your understanding of hospitality industry. Your task is to prepare a project of hospitality business which includes the operational requirement of business’ organisational structure in relation to human resource allocation. Please be specific and develop a rationale clearly justifying decisions linked to the target market.
P 3 Be able to plan the development of hospitality businesses
3.1 Develop a rationale for a selected project clearly justifying decision linked to target market
The rationale development for hospitality business can be undertaken by giving a particular example. Let us take an example of a project which will depict this properly as an example as follows:
The plan here would be to open a business which will comprise of opening of a hotel combined with a restaurant. This setup would be at a tourist location in the United Kingdom. This is because the demand for such a thing is very high due to the large population of people coming to UK every year. This shows that there is huge potential for such a business. The question here is that there is very tough competition in such a segment but the plan here would be to focus on the middle class families who cannot afford the luxurious services provided by the competition and would serve them the best services in their budget. The baseline of the business would be to provide the services best possible to the middle class families at lower prices for the people visiting the UK tourist destinations. This is just the starting plan and will also comprise of expanding it to other segments as well as to other geographical locations. This will require a lot of marketing research to be done.
Market research first business practice step before opening any new business and its results are very critical in deciding the success of any business (Olsen, 1998). The market research in this case would consists of making people fill the questionnaires related to this as well taking personal interviews with the people who will buy the product. This will help us to estimate the expectation of the customers and then the product to offer can be planned. This will start with finding out the demand of the product which we are planning to offer to the market at affordable price for all. This will also deal with finding out if the customers targeted will satisfied and happy with the product and the price at which they are offered to them. The sample size to be selected would be 1000 tourists who would be visiting the UK tourist destinations.
Target Market - The target marker as already discussed would be the middle class families who would not be able to afford the high package deals. The target segments will include the people from all ages but especially those who look for value for money and who would look for more affordable deals. In terms of the geographical locations to be chosen will be the popular UK tourist destinations.
Target Location and Size of the business - As discussed earlier the target geographical location will be the UK tourist destinations where many middle class families visit. The size of the business would be around 100 rooms with all the facilities like AC rooms and 50 rooms without AC. This will also constitute of the facilities of providing food and lodging.
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Investment - This will comprise partly from my own pocket and partly from the banks. The ratio would be 50:50 of using own money and taking loan from the bank.
Products and services to be offered:
- 100 fully AC rooms and 50 non AC rooms.
- Best quality food of varied variety
- Tourist guides for help
- Conveyance facilities provided to special guests.
Licensing - The things would be undertaken in proper legal manner with all the licensing to be done as required to open and run the business.
3.2 Development a Plan for Hospitality business including the operational requirements of the business’ organisational structure in relation to human resource allocation.
Ambience, interior are one the most important part of any service industry especially if it is from hotel, spa, restaurants etc. So when it comes to our hotel, designing and interior should be handled quite carefully, because it plays major part in getting and sustaining and increase customer service. But as we are focusing on middle class so the design should be simple yet luxurious, people should get the feeling that they have come to some good and special place. Its positioning will be done to attract people from middle and above middle class. In today’s world the number of middle and upper middle class is quite huge and everyone aspire to be more, similarly people from this class wants to spend luxurious holidays like upper class people but they need to find something which should be friendly for their pockets as well, so here we can position ourselves where we can relate them easily, quite luxurious as people wants yet so affordable, providing the affordable rates wouldn’t be difficult task but to good quality management & service will be. To ensure good service always we need to train our employees quite regularly so that they should treat them with respect and handle them in politely and friendly manner (Jones, 1999). The only way to sustainability would be to provide same if not better service to the customer who would turn into our repeat customer.
The next and most core part will be operations, how to handle the operations. Who will handle what? Which all departments are required? Etc. So the 1st part in this would be recruitment or staffing. Because this is quite big hotel and restaurant, so we can have 2 receptionists for hotel and 1 for restaurant. There will be separate waiters for both of them, so it means around 8 waiters for hotel and 10 for restaurant, and then we can have 2 managers; one for each. There will be 2 guides who will take care of tourist regarding all the tourist location near around. We will need 4-5 special cooks for different kind of food.
Now coming on to the qualification part for them; Receptionists should have at least bachelor degree and they should be good in interpersonal skills as they need to deal directly with the clients. Waiters should at least complete their schools and their behaviour should be friendly. Chefs should have some good experience in this field. A proper Human Resource management would be set up for any kind of recruitment, training and also managing any kind of conflict between them. Pricing would be below any big 3 star hotel but would be at par with simple hotels. Promotional activates can be done through Radio, Newspaper etc. Also they can create official page on Facebook & Twitter. Also providing some discount initially for few weeks would help more.
If we look more closely it can be understood that Travel & tourism business is alive just due to Catering and accommodation as people won’t be interested in travelling if they don’t have any place to eat or sleep. As discussed earlier people travel for 3 reasons recreational, leisure & business, so, they requirement will be different. Person coming for business may look for peaceful environment, having internet facility while people coming for other purposes have different need and to cater them there are lots of hotels and restaurants. So it can be clearly understood that to provide tourists with better and flawless experience the hospitality industry must work hand-in-hand with tourism industry. It’s a win-win situation for both because ultimately they both are getting the customer and both are generating revenue from them at the same time.