Achieving Financial Targets and Customer Satisfaction - Essay Example

Achieving Financial Targets and Satisfaction by Configuring Hospitality Resources: Analysis of Operations Management Frameworks Institutional Affiliation Date Introduction Products and services may appear as clearly present in the field of the hospitality industry. The hospitality industry may also be considered a critical field amidst the extensively of its growth. In fact, Ford, Sturman, and Heaton (2012 p. 4) stated that normally, the hospitality industry constitutes business and companies that “offer guests courteous, professional food, drink, and lodging services, alone, or in combination.” Now, the critical situation for hospitality businesses would appear to be on how such businesses would configure and develop its products and services in order to meet financial targets and customer satisfaction. It may always be a challenge for similar businesses on how to achieve these objectives. So as to make a research and give a comprehensive analysis, this paper is made. This presents discussions on the vitality of products and services in a business setting. However, issues on configuring them would mean a lot. However, there may be effective theories and models to be utilized in order to achieve such configuration. The Role of Products and Services in Meeting Customer Satisfaction Customer satisfaction, perhaps in most cases, can be derived out from how customers are pleased and to what extent are they being fulfilled towards an experienced product or a service. According to Anderson and Sullivan (cited in Gungor 2007), customer satisfaction is given with the regards as the general basis of customers’ assessment as to how a product or a service at certain, has met the assumptions of the customers. With this idea available, it can be construed that the involvement of the products and services, by any variety, is highly directing towards meeting customer satisfaction. From the time products and services reached a certain person and had it consumed or experienced, that particular person, by all means, may give an opinion instantly. The outcome of such opinion conveys that if such opinion refers to a positive one, it may imply customer satisfaction. However, if it refers to a negative one, it may also imply customer dissatisfaction which according to Engel, Blackwell, and Miniard (cited in Gungor 2007), is the result of a customer assumption unable to be met. Meanwhile, Lamb, Hair, and McDaniel (2009) discussed on their book about the extensive mission statement carried by a lot of companies, which states the concept of offering products with high-grade quality toward the global market. This widely-used mission statement clearly explains how many companies are seriously viewing the quality of products as an asset in achieving customer satisfaction. On the other hand, Avlonitis and Papastathopoulou (2006) stated on their book that products are considerably the most important reason a business exists. However, amidst the idea that a lot of contributors may impact and have the influence to make a business succeed or collapse, is the idea that meeting products and customer needs is difficult (Avlonitis and Papastathopoulou 2006). These things express the essentiality of products and their role in meeting what businesses greatly value–customer satisfaction. On the other hand, services may directly be pointed to the hospitality industry as the nature of such industry mainly highlights various services attended to guests or customers. According to Tesone (2010, p. 5), the hospitality industry attends to various forms of services taking place in “lodging, food service, travel, tourism, recreation, entertainment, personal health and fitness, attractions, social events, meetings, and conventions”. These given forms of services taking place in the hospitality industry can lead to the idea that services mainly are important as they are also essentials in achieving customer satisfaction. In fact, Cook (2004) stated that the services being attended to guests and what they have observed while inside a business company lead straight toward the impression for customer satisfaction. In the context of the hospitality industry, the existence of a good set of products and the quality of services being executed toward guests are both expected to lead to customer satisfaction. However, there may always be issues and challenges on how the systems and process within a hospitality business perform well. The broad concept of operations management may face difficulties along with how hospitality businesses would configure both their products and services. Issues of Operations Management Systems in Configuring Hospitality Resources The hospitality industry essentially has a huge responsibility of connecting the domestic and the commercial world while executing the service that they do best (Crick & Spencer 2011). Accordingly, it can be described as an effort towards the staff and managers to provide at some extent a kind of hospitality while at the same time maintain a balance between adaptability and profitability. While several literatures are still on the process of contending that the execution of services in the hospitality industry is entirely disparate from the delivery of other kinds of services, the impact in which these services are handled, implemented, and recognized by the customers will still matter the most. Therefore, gaining an understanding of the general issues in operations management system in terms of hospitality resources can help future researches bridge any gaps and aim towards modern strategic directions. Perhaps one of the big issues faced by operations management system when talking about resources is the rapid increases in operating costs. As the year passes by, escalating operating expenses are feared to rise much greater than the income generated by industries, conceivably deteriorating the bottom line (Duncan, Scott & Baum 2013). One facet of this issue is the surge on energy costs. Worldwide demands, heightened globalization, and natural calamities have affected energy supplies. Another issue that impacts hospitality resources is the higher insurance costs that can deal huge modifications in terms of deductibles and coverage inclusion caps for users. The third aspect that involves operating costs would the shortages and increases in labour. In the US alone, there are several national campaigns to legislate living wage laws and labor unions that seek to fasten labor contracts to solidify their bargaining powers. The threat of these rising cost appears when there is a struggle in attracting resources, specifically human resources. Nonetheless, one solution could be an increase in wages to generate a more cutthroat labor pool, which will be another issue to be tackled. With the fast-paced operations and great changes brought about by internationalization, the hospitality industry is rapidly changing from traditional methods of delivering services into web-based technology (Zhang, Joglekar & Verma 2012). In a similar fashion, this heightened changes and fast merging of technologies allowed a more effortless and smooth assimilation of operational data. Customers will always seek for the best quality, and it is the responsibility of the hotel industry to satisfy their needs (Crick & Spencer 2011). A lot of the hotel industry is streamlining their operations, but it is also taken into consideration that there are also many who are left behind. Also, the expected changes happen far more than it is anticipated, and the real challenge for the operations management system is in adapting to these rapid changes by providing sustainable knowledge and to take advantage of the benefits for the integrated technology. The older systems need to adjust and update their structures, and the new ones need to continually invest in trainings and development programs in order to remain competitive and sustainable in the long run. The absolute boost in operations should have impressive integrated systems and adoption of a modern technology. Situational Analysis of Operational Resources and Processes of Businesses with: a. Low Cost Objective for Customers For a lot of reasons perhaps, a lot of customers would want to purchase products and experience services with low-relative costs. With this impression, a lot of businesses in the hospitality industry may also want to meet what the general public seeks. According to Gimenez (2013), there is a clear fact that a lot of customers would always look for cheaper costs and that business will need to counter that customer requirement. However, Gimenez (2013) added that the idea of focusing the objective towards providing items at cheaper costs may also lead to a heightened cost as its turning point. Now, the turning point expresses that when a business would provide products and services at a lower cost, the quality of these things may be compromised. The dilemma in this situation evokes that upon the processing of products to be sold at a lower cost; there may be instances that the manufacturing may not be that high. Normally, as Rode (2014) stated, businessmen would want to earn as they involve themselves in businesses. With this, it can be understood that also in the context of the hospitality industry, businesses would also aim to earn high income. However, if the objective tends to focus more on proving products and services at lower costs, the sustainability of businesses would be hard to achieve. b. Adequate and Speedy Delivery According to Baraban and Durocher (2010), businesses that practice a quick-servicing style, such as restaurants, would need to be organized well in order to set the delivery of products and services adequately. The idea of having an adequate, speedy, and quick delivery of service may be helpful most especially if the businesses involved demand for such things in order to address the services toward customers. However, the idea may also be harmful as they may compromise the quality of service attended to customers. Also, there may be instance wherein staffs tend to be over-speedy in attending from one customer to another. As a degrading result, customers may feel that they are not treated well. Arranging and Achieving the Proper Configuration of Hospitality Resources The achievement of sustainable competitive advantage relies on the incessant development of present resources. It also depends on the creation of new resources and capacities in regards to the fast changing market situations. The initial step to achieve this goal is through the right configuration of resources. Resource configuration refers to the creation of capabilities for the years ahead by determining the comprehensive combination of resources and competencies. It demonstrates the comprehensive form of prerequisites for resources in the future (Kachru 2005, p. 442). The proper configuration of hospitality resources must derive the benefit of the organisation’s experience and conserve its distinctive resources. Specifically, future competencies must be developed by perfectly combining separate resources and operations. In addition, customer relationship but is effectively established and managed. The management of customer relations must be done in a unique way that cannot be duplicated. The failure of the competitors to duplicate the capabilities outcomes of the organization is their competitive advantage. Examination on how present resources and competencies need to be reconfigured must be done to suit it perfectly with new strategies. To effectively configure hospitality resources, a resource plan needs to be created which aligns several factors that contribute to the achievement of sustainable development. These factors include value-creation, management principles, and human processes (Kachru 2005, p. 443). In a hospitality business, it is important that value is provided in human capital resources. This encourages the increase of labour productivity and quality. Skills and knowledge are considered to be resources that contribute to competitive advantage, thus, it is required that these resources are protected and developed. Training and education are provided to constantly develop the skills and knowledge of employees in a hospitality organisation. Human capital is required to meet the requirements of customers. This also becomes an origin for innovation and improvement. Tacit knowledge that is incorporated in the organisation’s operations can also be a source of competitive advantage. This is due to the fact that this type of knowledge is difficult to duplicate. Sharing similar knowledge may be an indication of a favorable employee-relation, but it presents an issue for modernization. To solve this dilemma, it is recommended that multi-skilled workers are hired to meet the diverse needs of customers (Riley & Szivas 2009, p. 117). The organisation must properly combine its resources to develop competencies. A synergy of internal and external resources must be maintained to achieve competitive advantage. Internal resources which include the management and employees must work together which contribute to the achievement of goals and objectives. External resources such as suppliers must be selected accordingly based from the quickness of their delivery. The value chain between the operations and suppliers must be demonstrated efficiently to provide the best service to customers. Moreover, performance enhancement is achieved through the reengineering of business procedures. This combines the present resources with competencies to create new strategies. This is accomplished through the analysis of the market and its competition. In the reengineering of procedures, weak processes that provide delays and poor customer service should be identified and addressed (Gunasekaran & Kobu 2002, p. 2521). Appropriate Key Theories and Models of Operations Management Hospitality industry is deemed to be one of the most significant branches of the tourism as this accommodates and caters the need of the customers or guests. Nemeth, Friedrich, & Clarke (2013, p. 643) pointed out in their article that there is huge competition among all the businesses under the hospitality industry. In order for them to stand among other firms they need to be always innovative specifically with regard to their processes and resources. However, Kokaz & Murphy (n.d., p. 3) revealed that some of the businesses in this industry such as hotels had been lagging behind and reactive with regards to innovation. Hence, they strongly recommended that the members of the hospitality industry need to involve themselves into new processes and technologies which are highly suitable and essential for the continuous success of their operations. Written below are the key models towards improving the processes and resources in their respective organizations so as for them to achieve their organizational goals and objectives as well as desired outcomes. Innovating Technology Adapting to technological innovation is highly significant to every business industry specifically in hospitality in which the competition is very tight. Technological innovation allows the organization to acquire equipment and technologies which can aid them in improving the processes and resources within their organization. These can be machines or tools that are essential in meeting the organizational goals, objectives, and desired outcomes of the firm (Nemeth, Friedrich, & Clarke 2013, p.649). The advancement of technology can aid the firms to effectively follow their standard operating procedures as well as in mapping and optimizing their services (Kokaz & Murphy n.d., p.3). These technological innovations are also helpful in providing customers the kind of service they deserved. Innovating the Organizational Processes, Norms, and Culture The success of the organisation does not only lie with the high-end technologies they used. The processes within the organization as well as the norms and culture of the company and people working on it and how these people deal with each other and to their customer also matter (Ongori & Iravo 2013, p.897). Hence, Nemeth, Friedrich, & Clarke (2013, p.649) strongly argued that firms must also have organizational innovations. Organization innovation would mean that the firm needs to adapt and adhere to changes within their internal and external environment. Organizational innovations in the hospitality sector are highly significant so as to meet and adjust with the constantly changing consumer behaviors and with the tight and increasing competition within the industry. The example for an organization practice organizational innovation is the Bonvino Hotel. In their hotel operations, they conduct a weekly meeting in which all are encourage to express their ideas for the improvement of the hotel and to give constructive suggestions. The results of this organisational innovation can be observed in the operations and processes of the hotel (Nemeth, Friedrich, & Clarke 2013, p.650). Innovating Human Resource Khanfar (2011, p. 84) in his article stated that conducting regular trainings for hospitality personnel is a significant investment for a business organization. Yang (2010, p. 5) further added that training staff is highly important for the success of a business. To ensure the continuous triumph of the organization in meeting its goals and objectives and in satisfying customers, it is also important to conduct human capital innovation. Along with technological and organizational innovations, the knowledge and skill of the company’s human resources must also be innovated and further developed (Nemeth, Friedrich, & Clarke 2013, p. 694). These can be done by having regular trainings and mentoring. Human resource innovation also include employee empowerment such as encouraging them to express themselves and participate in the decision making process. Recommendations and Most Appropriate Solution For most cases, specifically on situations involving businesses in the hospitality industry, it is highly recommended that: Lodging accommodations, such as hotels and other similar businesses, would acquire innovative check-in/check-out and billing systems that would easily be understood by staffs. Lodging accommodations would disseminate duties and responsibilities effectively that according to the functions of each department. Restaurants and other similar food and beverage businesses will have good and adequate suppliers. Production companies involved in the hospitality industry would consider product variations in a way that they consider the creation of products according to the demands. Price and quality would both be considered by businesses in the hospitality industry. Similar businesses of hotels and restaurants, such as spas, recreational sites, fitness centers, theme parks, etc. would provide products and services that match the need of the available market. Understand consumer behaviour well and integrate the concepts with the operations management. Conclusion Conclusively, products and services are both important for business survival. Products, as critical as they are, would not mean to be made or created instantaneously. They have to be made with the highest regards on the market demands or the need of the general public. Customers or buyers can be concluded to have different variations as basis for their decision-making. They all have their own thoughts and individual levels of customer satisfaction. Meanwhile, services also have different issues as to how they will be executed and delivered to customers. In the context of the hospitality industry, considering its vastness, businesses involved mainly are rooted in providing quality products and services to guests. However, beyond these things is a greater challenge on how to configure both and improve operational systems and processes practiced in similar businesses. As such, there are also various theories and models of operations management applicable to hospitality businesses. Conclusively, models and theories such as innovation in technology, innovation in organizational processes, norms and culture, and innovation in human resource are analyzed to be very appropriate so as to aid in configuring products and services. With these things on hand, financial targets and customer satisfaction are now highly expected to become achievable. References Avlonitis, G & Papastathopoulou, P 2006, Products and services management, Sage Publications Ltd., London. Baraban, R & Durocher, J 2010, Successful restaurant design, John Wiley & Sons, Inc., New Jersey. Crick, A & Spencer, A 2011, ‘Hospitality Quality: New Directions and New Challenges’. International Journal of Contemporary Hospitality Management, vol.23, no.4, pp.463-78. Cook, S 2004, Measuring customer service effectiveness, Gower Publishing Limited, England. Duncan, T, Scott, D & Baum, T 2013, ‘The mobilities of hospitality work: An exploration of issues and debates’. Annals of Tourism Research, vol.41, pp.1-19. Ford, R, Sturman, M & Heaton, C 2012, Managing quality service in hospitality: how organizations achieve excellence in guest experience, Delmar, USA. Gimenez, JFV 2013, Beyond the low cost business: rethinking the business model, Palgrave Macmillan, United Kingdom. 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Nemeth, P, Friedrich, N, & Clarke, A 2013, ‘Innovation in special hotels- as a key to success’, paper presented to International Conference, Zadar, Croatia, June. Ongori, JK 2013, ‘Factors affecting performance of hotels and restaurants in Kenya: a case of Kisii county’, Interdisciplinary Journal of Contemporary Research in Business, vol. 4, no. 12, pp. 897-928. Rode, T 2014, Are you drifting?, Balboa Press, Indiana. Riley, M & Szivas, E 2009, ‘The valuation of skill and the configuration of HRM’, Tourism economics, vol. 15, no. 1, pp. 105-120. Tesone, D 2010, Principles of management for the hospitality industry, Butterworth-Heinemann, United Kingdom. Yang, X 2010, The importance of staff training in the hotel industry, viewed 12 December 2014, http://www.theseus.fi/bitstream/handle/10024/7213/Final%20Thesis--The%20importance%20of%20Staff%20training%20in%20the%20hotel%20industy.pdf. Zhang, J, Joglekar, N & Verma R 2012 ‘Pushing the frontier of sustainable service operations management: Evidence from US hospitality industry’. Journal of Service Management, vol.23, no.3, pp.377-99. Follow-up Questions: What have you learnt from this assignment? I learnt that products and services are very important, yet critical for businesses in the hospitality industry. Configuring processes and systems in the operations management may be very difficult. However, there are various operations management theories and models that would be very beneficial in order to achieve financial targets and customer satisfaction. What did you find easiest about this assignment? The easiest part is when I characterized and discussed the role of products and services in customer satisfaction. What did you find the most challenging? I find the part where I conducted a research on the appropriate theories and models of operations management challenging. This is because I have to analyze first the situations and the issues commonly happening in the context of different businesses in the hospitality industry. What aspect of the assignment would you most value feedback on? I really had a great interest on making a feedback about the situational analysis in the two business situations which had two different objectives. Read More