Decision Making for Hotels and Restaurants Management - BMW Company - Case Study Example

Decision Making for Hotels and Restaurants Managements Name Institution Course Instructor Date Abstract Sound decision making is an essential practice that should be adopted to ensure success of any business enterprise. This paper discusses various techniques that can be applied to ensurestandard decision making in hotel environment. Some of the discussed techniques include structured decision making. In this case the paper reflects on the procedure involved in decision making in regard to any particular problem. The paper also discusses decision support systems tools used in facilitating decision making, Delphidecision making technique that involves group work, and lastly MCDM where multiple criteria are applied to solve a single problem. The paper then discusses a case study of BMW Company; an automaker company that has ensured its great success through sound decisions making. Finally, the paper provides a brief summary of the discussion and a brief recommendation derived from the research. Introduction Decision making is a chaotic business where by in most cases things do not turn out as hoped for or expected. Decision making essence is application of reflective thought. According to Eisenhardt (1989). managers with direction, education, and experience are expected to make hard decisions that will be useful for running an organization at the actual time and in future. Decision holds the life of an organization. They can result to prosperity or down fall of any business enterprise and thus, care must be taken to ensure right and reliable decisions are made in any slight issue that arises in an organization. Good experience and right knowledge in handling decision making tools as well as in settling to the actual decision is at the centre of sound management. According to O’Halloran (1996) thinking managers make progress more swiftly and assume extra responsibilities and thus, turning to be an industries leaders. Decision-making is the procedure of selecting and determining solutions which can assist to attain intended goals in organizations dealing with hospitality. Decisions making is one of the chief hospitality managers’ responsibilities and it can take place at organizational, group or individual level. According to Simon (1979) managers in hospitality organizations are entitled to make two forms of decisions which include non-programmed and programmed decisions making. The latter is forms is routine and repetitive, for instance making shifts in department of F&B, while the former is the unstructured and new decisions for instance a hotel group settling on opening a novel hotel brand are required. To emphasis on how non-programmed and programmed decisions are settled, there are a number of decision-making models that have been suggested. These models include the garbage model, the political model, the process model, the bounded-rational model, and the rational model. Every model is founded on various assumptions set and provide distinctive insight into organizations’ decision making (Miller et al., 1999). Miller et al. emphasis more on managers/leaders’ style and role in decisionsmaking Styles for group verses individual decision making is also considered since, they both contain limitations and advantages. Various decision-making techniques have been proposed. These techniques include computer group method of problem solving, the nominal group method, Delphi technique, brainstorming technique and managers training on decisions making. StructuredDecision Making According to O'Fallonand Rutherford (2010) a sound decision making involves a number of processes. The initial process in decision making that involves problem definition. The managers are supposed to establish the definite problem or issue influencing the situation to be decided on. After problem definition, a manager is supposed to get into the root of the matter by investigating more on the issue to establish what would be the source of the problem or its motivator. Depending on the nature of the problem, the manager is supposed to come upwith several suggestions and from them, settle on the most appropriate suggestion. Every decision influences resources set which then influences an operation. In most cases, an operational manager in hospitality environment makes several decisions in a distinctive day as compared to other businesses via intersections with vendors, guests, and staff among others. Some of these decisions are repetitive and simple while others are complex, for instance those that deals with financial and personal implications. According to () some decisions consumes more time for an alternative to be considered while others will need an almost instant response. According to O’Halloran (1996) mangers in most cases do not have an upper hand in all situations and thus, they sometimes need to structure the process of decision making. According to him, decision making can be classified into two different classes which include well-structured and ill structured decisions making. A well-structured decision making involves problems that regularly faced by managers and can characteristically be solved using a similar technique. Although the situations are not always the same, a similar method can be applied to come up with a concrete solution. On the other hand, ill structured decision making involves problems which do not have a single preferred or optimal solution. The answer or solution to an ill structured issue could vary depending on different factors as well as the particular person making the decision. Handling ill structured issues also centres on control as well as willingness of a manager to take a computed risk. In this case two different reasonable individuals can make two varying but reasonable decisions by applying similar facts and in the similar situation. According to Litemind(2007) a manger needs to evaluate his/her level of expertise in a particular problem area before engaging himself in decision making process. If the level of expertise does not rhyme with the current problem, the manager is supposed to get the right input or source for a consultant, colleague, a mentor or any other form of advice that would enlighten in regard to the problem before making a decision. Beside this, the decision maker is supposed to collect evidence based on a case if need be before settling on an issue, and decide on the best evidence to use while making the decision. This is quite necessary in restaurants and hotels especially where the attendants need to handle clients’ properties. A client might claim of theft or mishandling of his/her luggage. A manager is supposed to way all the possible alternatives by evaluating possible outcomes based on each possible solution. The solution with the least possible negative outcome is supposed to be picked as the solution to the problem. The result of the decision are then monitor to note the actual outcome and to handle any possible issue rising from the outcome. Decision Support Systems Technique The advancement in information technology has brought about a new technique that assists managers in making critical decision in various fields. This is achieved by use of decision support software. The software contains a database that holds a number of problems that have previously been encounter in this case in hotel management as well as matching solutions that effectively worked to solve the situation. The tool assists the managers in retrieving these past solution related with their current situation and obtains all possible solutions. The solutions are then weighed and the best solution is picked to handle the situation. If the nature of the case is unique, the managers carry out the whole decision making process and come up with a solution. The solution is the monitored and if it proves to produce the best outcomes, it is also added in the database to be employed in similar situations in future. This tool is very essential in decision making for it shorten the time used to handle critical decisions making situations (Information Builders, 1996). Delphi Decision Making Technique Delphi decision making technique is a process that involves answering open-ended surveys and questionnaires by selected group of experts, who are not allowed to sit and discuss the problem but only to converse in writing. The group members are requested to assess the situation and give their report regarding the assessment explanation as well as the possible solutions to the problem. The manager facilitates the process by controlling the communications among the participants through information processing and irrelevant content filtering. After analysing the situation, the manager develops various replies and sends them back to the participants. Consequently, the members develop another decision founded on the novel information. This process is reiterated until the point where the responses converge reasonably; the responses result into consensus. This process success depends on the communication skills as well as the expertise of the members. Another limitation experienced in this process is that every response needs enough time for analysis as well as reflection. The chief merits associated with this process are it ensure efficient application of time of expert, allows ideals diversity, accuracy of predictions and solutions and also it eliminate interpersonal issues. This technique is best applied in hotel or restaurant management where there is a lot interaction involved between workers and visitors and thus, higher chances of false accusations by malicious visitors or workers. Additionally the nature of good used by hotels are quite sensitive and if the right decision is not settled on, the business can experience great loss due to perishability of stock as well as preparation of excess food than it can be consumed (Custer et al., 1999). Multiple Criteria Decision Making (MCDM) Technique Multiple criteria decision making (MCDM) involves making decisions in the existence of multiple, normal conflicting norms. According to Xu and Yang (2001) problems of MCDM are usual in each life. In personal case, a car or a house that one buys may be typified in comfort, safety, style, size and price terms. In business situation, problems of MCDM are normally very complicated and of large scale. For instance a number of enterprises in Europe are carrying out self-organizational assessment by use of hundreds of sub-criteria and criteria set in business model of excellence of the EFQM (European Foundation for Quality Management). Departments of purchasingbig companies frequently need to assess their suppliers by use of a number of criteria in various areas for instance financial stability, quality, management, and sale service among others (Huynh et al., 2006). The MCDM discipline development has highly been influenced by computer technology development. On one side, rapid information and computer technology development in the recent past has facilitated conducting of complex MCDM issues systematic analysis. On the second side, the extensive use of information and computer technology has created a huge information quantity that makes MCDM progressively useful and essential in supporting decision making in business. There are two different forms of MCDM issues that are brought about by the varying settings of problems. One of the settings involves limited alternative solutions quantity while the other type involves infinite solutions number. The major advantage of using this technique is that it can be used to analyse any form of problem for it defines its solutions depending on the least possible analysis level that can be attained and thus, it is not only meant for problems with finite solution. The above discussed techniques can successfully be implemented in a hotel management to ensure reliable decision making that will ensure great success and development of the business (Jacquet-Lagreze andSiskos, 1982). Case Study This paper reviews the success of BMW Company, which is obtained from past perfect decision making as well as proper maintenance of the company’s progress through development of suitable solutions as well as standard decision to the current encountered problems. BMW Company is Germany founded company, which is the most valued automaker company in the world. BMW is known for crafting luxurious SUVs as well as cars that provide superior driving enjoyment level. BMW was founded in 1913 where it operated based on airplane crafting which was later dropped for car manufacturing. Although the company experienced a number of problems during its growth and developments, it has been able to rise to the current situation where it is registered as the best automakers in the world. The company which has been competing with other automobile companies in the world was able to bet Mercedes in 1992 and worked hard to maintain a high profile. This success has been derived from sound decision making in the company (BMW, 2012). Being a big international company, BMW has been involved in complex decision making. One of the greatest decisions made in BMW was dropping of Rover Group PLC in 2000, which they had bought in 1994 after they realized the company was making huge losses, an aspect that could have affected other stable sub-companies and departments in BMW Company. Another major decision that has brought great success to the company is re-entering in manufacturing of aircraft engine business in 1990 after having done away with it for quite a long time. Additionally, the buying of right to fully own Rolls Royce a product they had developed in collaboration with Rolls-Royce GmbH in 1998 gave it a great fame and thus, raising its further in the market. Today, the development of series Z8, Z3, 7, 5, 3 as well as motorsport model series continue the BMW excellent automobiles building traditions with a distinct emphasis on technological, style and performance advancements (Popescu, 2000). BMW is a big company that is involved in a number of complex processes that require extensive analysis and assessment before making a decision. In large company such as BMW, a single decision in one department can affect the functionality of all other sections and thus, uplifting the company or pulling it down depending on the suitability of the decision. In this regard, decision making in this company has not been left in hands of a single person. The company has adopted MCDM form of decision making where a number of criteria need to be applied to come up with a decision. To solve a problem in BMW Company, the manager involves various experts that are directly concerned with the problems as well as other experts whose area of expertise can indirectly be influenced by the problem and its developed solution. This criterion enable the company to remain among the best in automakers’ world market due to quality maintenance as well as safeguarding the company from various scandals that would affect its legacy in the market (IBM, 2012). Conclusion Decision making is one of the major tactics that any business enterprise should always get right to ensure smooth operations and running of a business. It has been established that companies of the same calliper range differently in the market depending on the kind of management employed in each. Therefore, a company should ensure that it employs a manager with high level of expertise and knowledge to ensure high standard of management and control in it. Additionally, the manager should be in a position of making wise judgement after a comprehensive evaluation of a situation without making a lot of assumptions. Although there are a number of decisions making criteria, they are not equally applicable even in a similar situation. Therefore, a manager should develop a way of testing the available decision making criteria and settle on the one that give the best possible results. According to our analysis, MCDM technique has been reported to be the best decision making technique, since it combines a number of techniques, thus substituting for the limitation of others. Thus to achieve the best any business enterprise should consider adopting this criteria to handle their problems. References BMW, 2012.International BMW website. [online] Available at: < http://www.bmw.com/com/en/index.html > [Accessed 11 November 2012]. Custer, R. L., Scarcella, J. A. and Stewart, B. 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