Operations Management in the Kitchens of the Hotel - Essay Example

Table of Contents Executive Summary……..2 2. Introduction……………...3 2 Research Methodology………3 2.2 Features of the hotel which have a bearing on my analysis and which were not included in the description provided……….3 3. General Analysis……………………4 4. Analysis of the operations management in the kitchens of the hotel and the significance of quality and smooth flow of operations in regard to them……….11 .5. Outline of the possible difficulties and an explanation of how they might be overcome (Recommendations)………….14 6. Summary of Findings…….15 1. Executive Summary: The report is a detailed study of the operations management of the hotel. After studying the general aspects of the operations management of the hotel, a primary research was undertaken for analyzing the operations management in the kitchens of the hotel. 35% of the customers surveyed found the quality of food served by the kitchens to be poor. 30% found them good. 35% found them outstanding. The operations management is successful in ensuring smooth flow of operations in the kitchen. It is recommended that the quality of food prepared in the kitchen be improved further so as to enhance customer satisfaction. The kitchens should also try to achieve a higher Michelin rating for the restaurant. This will increase the revenues from high margin sales of food. 2. Introduction: The report studies the operations management of a prominent five star hotel. A general analysis of the operations management of the hotel has been undertaken. The report also throws light on the operations management in the kitchens of the hotel and the importance of quality. 2.1 Research Methodology: The research methodology employed primary research. The various aspects of the operations management of the hotel were observed directly. A customer survey was also done. 2.2 Features of the hotel which have a bearing on my analysis and which were not included in the description provided: Features like operations management in the kitchens, the rating of the restaurant by Michelin, the customer survey undertaken etc. were not given in the description provided. They have an important bearing on my analysis. 3. General Analysis of the Five-Star hotel: Operations management is as relevant in a service facility like a five-star hotel as they are in a manufacturing facility (Krajewski, L.J., and L.P. Ritzman , 1993 ). The operations management is informed by the strategy of the hotel and plays the most important role in strategic implementation. Operations Management of the five star hotel : Mapping of the processes of the operations management of the hotel: Processes involved in the operations management of the five star hotel: Facility design ↓ Supply chain management ↓ Planning & Scheduling ↓ Shop floor control ↓ Management of food & beverages ↓ Quality management ↓ Service Management ↓ Lean operations ↓ Benchmarking ↓ Technology management ↓ Environmental friendly operations ↓ Business process re-engineering Facility design: The operations management facility in this case is a five star hotel. The hotel has 250 double-bed rooms. All the rooms have attached toilet and bathroom facilities (en suite facilities) The hotel has no suites. There are two large dining rooms. One of these dining rooms is a restaurant that offers an ‘a la carte’ menu. The other dining room has a capacity of 300 people and serves a standard buffet menu. The hotel also has two bars that serve alcoholic beverages. One of these bars targets the general public of the city. It, therefore, has an entrance on the public street side of the hotel. The other bar is a cocktail bar. It mainly focuses on the guests of the hotel who are staying there. However, members of the general public who are not staying in the hotel are also not prohibited from this bar. There are three “function rooms” that serve as banquet halls for the arrangement of parties, wedding and conferences. Functions like these are a major and consistent source of revenue for the hotel. The capacity of the function rooms is 50, 200 and 1000 respectively. The leisure facilities of the hotel include a swimming pool, gym and a suite of sauna facilities. The design of the hotel plays a very critical role in its success. The facility design of the hotel is such that it is able to give maximum benefits to the customers of the hotel. The facility design of the hotel has utilized the available retail space optimally. The hotel is located in the center of the international city. The property prices are very high in this area. The returns on investment in property of the hotel can only be maximized by optimum utilization of each inch of available space. The hotel seems to have succeeded in this. However, the facility design of the hotel could have been better if the hotel had left some more open space in the lawns. Supplies: The two major components of supply are food & beverages. The hotel procures the highest quality of food and beverages for its kitchen and bar operations. It has a long term strategic partnership with its suppliers. The critical factors in the supply chain management of the hotel are: 1) Quality. 2) Timely availability (minimum lead time). 3) Costs. Planning & scheduling: Planning & scheduling guide the operations management of the hotel. The hotel has a very flexible approach towards planning. The planning is continuously changed according to the different seasons and room occupancy. The planning addresses the following aspects: i) Sales & operations planning: Different times of the year have different room occupancy rates. The objective of sales planning in the hotel is to maximize the room occupancy rates. Operations planning is concerned with adjusting operations according to the variable sales or room occupancy. ii) Materials Requirements Planning (MRP): This is planning for the material resources (like food items, beverages and other miscellaneous items) required for the operations of the hotel. iii) Capacity planning: The hotel’s room occupancy rate varies with the different seasons of the year. The capacity planning is concerned with planning the different aspects of the operations according to the available capacity during different seasons. Material and resource requirements of the hotel vary with the room occupancy rates. iv) Scheduling: The objective of scheduling is to deploy the human resources in such a way so as to remove bottlenecks to productivity and service management. During peak seasons the hotel relies on the use of a lot of part-time workers. Every activity of the operations management of the hotel, down to the last detail is planned. For instance, even the colors of the roses that adorn the central vase of the reception desk are planned beforehand for the different days of the week. The Enterprise Resource Planning software of the hotel greatly helps the planning process. The hotel has purchased customized ERP software that was designed in view of its unique requirements, from Oracle. The Enterprise Resource Planning software facilitates the flow of information between the different departments of the hotel. It also links the outside stakeholders, like suppliers, to the hotel. Shop floor control: The shop floor control of the hotel is responsible for service delivery of the hotel. The shop floor control manages the service staff of the hotel which has around 500 employees. The service department is the largest department of the hotel. The shop floor control plays a very important role in maintaining smooth flow of operations. Environment friendly operations: The operations management of the hotel tries to make majority of its operations environment friendly. The emission of greenhouse gases from the operations of the hotel is tightly regulated. The stricter government regulations on the greenhouse gas emissions in the wake of concerns regarding global warming have increased the awareness of operations management regarding environment. The use of recycled materials is encouraged in all the activities of the operations management of the hotel. The operations management strives to cut down on its energy consumption in every possible way. The hotel is now in the process of cutting down in its use of paper. As part of this initiative, the writing pads for the use of guests in the rooms of the hotel are now much thinner and smaller. Environmental initiatives of this kind also have brought cost savings for the hotel. State-of-the-art technology: The operations management of the hotel relies on the use of the state-of-art technology in every aspect of the operations. The Information technology architecture of the hotel has been designed in such a way so that it is effective in meeting the unique needs of the hotel. Every department of the hotel has one employee who is well versed in the usage and understanding of information technology. This allows the hotel to exploit the developments in information technology. The use of technology has also increased in other aspects of the operations. It has even increased in kitchen operations of the hotel. Quality: The five star hotel serves international luxury and business tourists. These tourists are highly sensitive to quality issues. Quality has to be maintained in every aspect of the operations management of the hotel. The hotel uses the highest quality of ingredients in its kitchens for giving the highest quality of food. The beverages served in the bar are also of premium quality. The permanent service staff employed by the hotel undergoes three months of training before being employed for serving the guests. The hotel also employs a lot of contract workers .For service operations, the hotel employs only those contract workers who have at least a year of experience in serving at five star hotels of similar standards. For maintaining quality, the hotel also relies on having suppliers who are able to consistently deliver high quality of materials for the different aspects of its operations. The hotel has forged strategic partnerships with such suppliers. In the kitchens of the hotel, the hotel employs a staff of 40 chefs who are the best in the industry. The hotel pays them salaries that are above the industry standards so as to derive the best output from them. Lean operations: The underlying motto of the operations management of the hotel is to strive for lean operations. The use of resources is optimized by giving strict attention to the minute details of operations. Costs are tightly controlled at every stage of operations. However, it is also ensured that this cost control does not come by cutting corners that have the effect of deteriorating the overall quality. The ‘lean operations’ drive the efficiency of the operations of the hotel. Efficiency in operations is defined as minimization of wastage in every aspect of the operations and maximum utilization of resources (Davenport,Thomas ,1993). The ‘lean operations’ of the operations management of the hotel greatly impacts the profitability of the hotel. The lower costs, due to reduced wastage, have a positive impact on the value created by the hotel for its shareholders. Benchmarking: The operations management of the hotel practices two kinds of benchmarking methods. In the first method, the performance is adjudged by comparing them with the leaders in the industry. The second method is of “internal benchmarking”. The actual performance is compared with the budgeted and planned standards of operations (Ruffini, Frans A.J., Harry Boer, and Maarten J. Van Riemsdijk, 2000). Variances are then identified. Steps are taken to rectify the causes for negative variance in the performance of operations. Business Process Reengineering: The business processes of the hotel are continuously reengineered according to the changing needs of the customers and developments in the external environment. The key business processes of the operations management begin from the time a guest arrives at the entrance of the hotel. Every stage of the following processes is designed to give the customer a satisfactory experience. The business processes have been logically designed so as to achieve the desired outcome of maximizing customer satisfaction (Bateman, Thomas S., and Carl P. Zeithaml, 2006). The two objectives of business process reengineering in operations management of the hotel are: 1) To achieve the objectives laid down in the mission and vision statement of the hotel. 2) To continuously increase the efficiency of the operations by identifying new ways of reducing costs. 4. Analysis of the operations management in the kitchens of the hotel and the significance of quality and smooth flow of operations in regard to them: There are three kitchens in the hotel. Two of these kitchens serve the two dining rooms of the hotel. The first dining room has a seating capacity of 300 people and it offers a standard menu. The second dining room is an up market restaurant that serves ‘a la carte’ menu. This restaurant has been given a one star rating by Michelin. A one star cuisine is an indicator of a “very good cuisine” in its category. The highest category is that of three Michelin stars ( www.michelinguide.com ) .The third kitchen serves the three function rooms of the hotel. The function rooms are used for organizing large scale events like parties, weddings and conferences. A lot of the orders are directly served in the rooms of the guests. These room service orders are served by all the three kitchens. The hotel operates a kitchen staff of about 40 chefs who are headed by a “corporate chef”. The salary provided to these chefs is the best in the industry. The quality of food is very important for maintaining customer satisfaction. The food served in the hotel is an important source of revenue for the hotel. It is also a major source of profitability as the food is priced at very high margins. Customer survey on quality of food served by the kitchens: As part of the research undertaken, about 50 guests of the hotels were asked their opinion about the quality of food served by the kitchen of the hotel. They were asked to rate their responses on a scale of 1 to 4. The ratings were defined as: 1- Poor quality. 2- Average. 3- good. 4- Outstanding. The response of the customers was as follows: 1 – 0% 2 – 35% 3 – 30% 4 – 35% Fig 1: Results of the customer survey. Fig 2: Input-Output model for the operations management in the kitchen of the hotel. Smooth flow of operations in the kitchens of the hotel: One of the most important objectives of operations management in a facility like the five star hotel is to maintain smooth flow of operations. The smooth flow of operations is particularly important for the three kitchens of the hotel. The customer satisfaction is inversely linked to the service time. The higher the service time the more will be the dissatisfaction of the customers. The smooth flow of operations in the kitchen ensures that the service time for serving the order for meals is minimized. The operations management in the kitchens was observed by visiting the kitchens of the hotel and observing the operations management there minutely. Maintaining smooth flow of operations is quite a challenge because of the large number of items that are prepared in the kitchens. A lot of planning is done beforehand for ensuring the smooth flow of operations in the kitchen. Inventory management plays a key role in this. The kitchens use state-of-art storage facilities for storing many of the food items. The suppliers play a critical role in the operations management of the kitchen. Through the use of information technology, the suppliers are continuously updated on the status of the different items of the inventory. The operations management of the kitchens of the hotel is very successful in maintaining smooth flow of operations. This has enabled the kitchens to keep service times within reasonable limits. 5. Outline of the possible difficulties and an explanation of how they might be overcome (Recommendations): The customer survey shows that about 35% of the customers surveyed found the quality of the food to be just average. This proportion should be brought down. One way to do so is to have tighter control on the quality of ingredients. The quality can be improved further by following these steps: 1) Identifying the problem. 2) Finding the cause. 3) Implementing preventive action. The chefs prepare the food. They play the most important role in the quality of food. The customer dissatisfaction can be brought down by employing better chefs in the kitchens of the hotel. Areas of shortcomings and those items of the menu that are not prepared that well have to be identified. Steps should be taken to improve on these shortcomings. The hotel should now strive to achieve a two star and then three star rating for the restaurant of the hotel. This will have a significant impact on the revenues and profitability of the hotel. The operations management is very successful in driving the smooth flow of operations at the kitchens. It should keep doing so by employing a strategy that reconciles the dichotomies of standardization and flexibility. 6. Summary of the findings: The operations management in the three kitchens of the hotel succeeds in maintaining smooth flow of operations. The majority of the customers surveyed (about 65%) found the quality of food served by the kitchens to be good or outstanding. 30% of those surveyed found the food to be just average. The quality of the food prepared in the kitchens can be improved by implementing strategies like employing better chefs, tighter control on the quality of ingredients and identifying areas of shortcomings. Food is a source of great profitability for the hotels. The food items served inside the hotel are priced at a high mark-up. Therefore, every step should be taken to serve the best possible quality of food. Operations management of the five star hotel plays a critical role in quality management and in maintaining smooth flow of operations. The importance of operations management, therefore, cannot be understated. References: Krajewski, L.J., and L.P. Ritzman , 1993, Operations Management: Strategy and Analysis. Addison-Wesley Publishing. Bateman, Thomas S., and Carl P. Zeithaml, 2006, Management: Function and Strategy. Richard D. Irwin. Ruffini, Frans A.J., Harry Boer, and Maarten J. Van Riemsdijk, 2000, "Organization Design in Operations Management." International Journal of Operations and Production Management. Davenport, Thomas ,1993, Process Innovation: Reengineering work through information technology, Harvard Business School Press, Boston Robert J Boxwell Jr, 1999, Benchmarking for Competitive Advantage., New York: McGraw-Hill. Owen M, 1989, SPC and continuous improvement, Bedford: IFS publications. www.michelinguide.com Read More