Process Improvement and Monitoring for Hotel Escargo - Case Study Example

Process Improvement and Monitoring for Hotel Escargo Copyright Excellence in service is the essence of excellence in hospitality because it is the warmth, the caring and the welcome extended to guests that often blur other failings. Extending a warm and sincere welcome to guests and honoring them is included in many religious and ethical traditions of the world. Thus, it is important that all staff at a hotel, especially those involved in frontline operations that create first impressions, be aware of what they should do to try to present excellence in service to the guests. When a guest registers at a hotel, they create a first impression that influences all other impressions about their stay at the hotel. Thus, the check-in and the checkout processes should be smooth and genuinely welcoming, with all effort directed to make the guests feel at home. The Hotel Escargo chain has tried to present winning guidelines to their frontline guest registration staff about what they should do when registering guests. However, a room for improvement exists and other areas of hotel operation can benefit from improvement in quality of service. This discussion presents new designs for registration processes for Hotel Escargo, the design of a business process for the hotel room service offering and ideas about monitoring of the previously mentioned processes to assist with achieving Six Sigma standards. Declaration I certify that, except where cited in the text, this work is the result of research carried out by the author of this study. _____________________________________________ Name and Signature of Author September 2009 This write - up is for a discussion about Process Improvement and Monitoring for Hotel Escargo. Biographical Sketch Acknowledgements Contents Introduction 1 The New Check-In and Checkout Processes 2 Process Map for the Room Service Offering at Hotel Escargo 8 Performance of the New Check-In and Checkout Processes 11 Monitoring and Control of Process Performance using Six Sigma Quality Standards 18 Conclusion 19 Appendix A – Observations for Hotel Escargo 21 Bibliography/ References 30 List of Figures New Check-In Process Diagram 4 New Checkout Process Diagram 7 Room Service Process Diagram 8 Control Chart for the Old Check-In Process 13 Control Chart for the New Check-In Process 14 Control Chart for the Old Checkout Process 15 Control Chart for the New Checkout Process 17 (This page intentionally left blank) Introduction This write-up presents a discussion about ways for improving the guest registration system at Hotel Escargo and the design of a process for the room service offering at the hotel. The mission statement of Hotel Escargo clearly presents values related to serving business and leisure travelers by making customer satisfaction highest priority and providing quality service, amenities, comfortable surroundings and friendly employees. However, a recent review undertaken at the Hotel Escargo chain indicates that amongst other improvements, it was possible to enhance the quality of the check-in and checkout systems implemented by the Rooms Division of Hotel Escargo. By improving procedures and interactions with guests, improved perceptions of service quality emerge and this results in improved customer satisfaction (Salvendy, 2001, Pp. 621 – 623) and (Bardi, 2007, Pp. 185 – 187). Thus, it is important to improve service quality at Hotel Escargo by improving the check-in and checkout system procedures and the discussion presented herein focus on the issues mentioned. This discussion presents new processes for check-in and checkout together with a new design for the Hotel Escargo room service offering. The discussion presented also includes ideas for the monitoring and control of future process performance. Appendix A presents observations for check-in and checkout operations at Hotel Escargo. The New Check-In and Checkout Processes A close look at the existing check-in and checkout processes for Hotel Escargo suggests that the average time for check-in and checkout at the hotel are in excess of the recommended times of four minutes and two minutes respectively, as mentioned in Appendix A. In addition, it is obvious from the sample of guests for check-in, checkout and change requests that an abnormally large number of guests registering with Hotel Escargo ask for room change. Thus, it is important to make some effort to ensure that the registration staff verifies with housekeeping for a list of cleaned rooms that are ready for guests prior to allocating a room. In addition, it is important to remind the hotel staff that they must deal with hotel guests in a time efficient manner, but it is more important to ensure that the guests receive their complete attention, even if this takes longer. Hotel Escargo cannot ignore the fact that it is always important to deal with guests in a most polite manner and that all guests should receive the complete and sincere attention of the hotel registration staff, even if this takes time. However, it is most important that guests are allocated a thoroughly clean room that has been certified as being ready for occupation by housekeeping so that any change requests do not arise and the guests are able to sustain a positive impression of Hotel Escargo. Thus, the new check-in process diagram for Hotel Escargo is as below. New Check-In Process Diagram It is clear from the new process mapping for the check in process that the new process is very similar to the previous process, but the new process attempts to ensure that the guests of Hotel Escargo are not allocated rooms that are not ready for occupation. The registration staff checks with housekeeping about the condition of a room prior to its allocation. The old check-in process did not include this check, which can save Hotel Escargo from incurring a serious dent in its image. Thus, it is now likely that a majority of guests will be satisfied with their rooms and this will result in fewer change requests made. It is important to remember that it is best to avoid rework in all business processes because this adds to the burden on the system and creates the extra unnecessary work that adds to costs. In the case of Hotel Escargo, the rework for room change not only adds to the costs associated with the business process for check-in, but it does far more harm by irrevocably damaging the reputation and standing of the hotel in the eyes of the guest. The previous is something that is very precious and is not readily changed. Apart from the previous change that ensures allocation of clean rooms to guests, there is not much else to change in the business process for check-in. However, it is possible to provide better training to Hotel Escargo registration staff, empower them and advise them to try to ensure quicker check-in for guests, but not at the expense of being impolite or not attending to their needs. A diagram for the new and revised checkout process for Hotel Escargo is below. In this process, the guest does not have to interact directly with the valet after calling the bellman to pick up luggage prior to vacating the room and proceeding to the registration desk for checkout. The guest can call either the bellman or the registration desk with instructions about what time they will want to checkout, what they will need for pick up and when the registration desk should have their account statement ready and finalized for their checkout. Then, either the bellman or the registration desk staff will act on their instructions and have everything ready for them to checkout from the hotel at the indicated time. Thus, the new checkout procedure presents a significant reduction in the burden on the guest and the hotel staff has more time available to them to prepare for a checkout by a guest. The actual process of checkout is now much shorter, smoother and hassle free as compared to the previous checkout arrangement. New Checkout Process Diagram Process Map for the Room Service Offering at Hotel Escargo Any guest can contact room service for a variety of needs ranging from information to serving food and beverages in the room or for doing the laundry etc. A guest may want to have arrangements made for delivery of specific items that they want to purchase from another outlet or they may want to have a tour arranged for them and do not want to visit the tour desk for information, preferring to contact the room service instead. Thus, it is important to enhance the room service function to include that of anticipating guest needs, discussing guest needs with them and advising them about what is best for them. Any service rendered must obviously be charged to the room and an authorization for this is required to be made in the form of a signature from the guest when fulfilling guest request or delivering. Thus, the room service acts as a telephonic interface to a wide range of other services provided to the hotel guests by the hotel or other service providers and the staff involved in interfacing with guests to coordinate delivery of services must be experienced and knowledgeable about matching guest needs with what is available. Enhanced customer satisfaction for room service becomes a reality because the customer only picks up their phone in their room to discuss their needs with a very knowledgeable hotel staff member who assists in having their selected needs fulfilled. Authorization with the front desk for billing prior to the delivery of service or merchandise to the guest in their hotel room is important. The front desk will consider the credit limit of the credit card, which the guest has assigned, or ring the guest for alternative payment arrangements prior to fulfillment if the charge is likely to be above the floor limit for the hotel. Service fulfillment is within reasonable time for most room service items or the room service informs the guest about the expected time for fulfillment of their room service request if it is not possible to deliver their requested item or service within the usual 10 – 15 minute period. A process diagram for the room service process is below. Room Service Process Diagram Performance of the New Check-In and Checkout Processes It is possible to observe the performance of the previously mentioned processes by observing new fulfillment times for guests in a sample of observations taken regarding service delivery. The best way to represent these observations is by using control charts, which is one of the seven basic tools of quality control (American Society for Quality, ASQ, 2009, “Quality Tools: Control Chart”). A control chart presents a graphic depiction of the way in which a process changes over time and a historical plot for measurements presents an estimate for future, or predicts future performance. A control chart depicts points that represent measurement of a quality characteristic, which in this case is time for completion of a process (American Society for Quality, ASQ, 2009, “Quality Tools: Control Chart”). Process times for completion of check-in, checkout or guest request to room service plotted over the x-axis with times plotted on the y-axis present a control chart, which includes a centerline for the process mean and upper and lower control limit lines above which the process output is considered as being statistically unlikely. Upper and lower warning limits that are two standard deviation above and below the mean centerline can be included on a control chart. For a process that is under control, the control chart plot presents itself within the upper and lower control limit lines. However, when a measurement plotted on the control chart falls outside of the upper or lower control line, the chart presents an indication about the process becoming abnormal or out of control. Those who study the control chart must make the decision if something has gone wrong and what needs done to improve performance or prevent future failure. Thus, a control chart presents an early warning for deterioration in a process and managers can act on this warning to maintain standards. Managers use control charts when a need exists to predict expected range of outcomes from a process or to monitor a process. Together with other information, control charts are also useful for troubleshooting why problems arise with a process and how best to correct them. A template for drawing control charts using Microsoft Excel in presented in (American Society for Quality, ASQ, 2009, “Quality Tools: Control Chart”) and it is possible for researchers to use this template to draw quality control charts for the check-in and checkout processes at Hotel Escargo and other business processes. However, this template does not present the upper and lower control limits on the control chart well. Thus, it is better to use the industrial statistics routines built into STATISTICA to construct the control charts because this software package presents superior graphics. The control chart diagrams below present check-in and checkout times for old and new processes. Control Chart for the Old Check-In Process It is obvious from the control chart for the old check-in process, which was drawn using observation data presented in Appendix A, that a very large number of observations for check-in fall outside of the upper and lower control limits for the process marked on the chart presented above. The mean line presented on the control chart with a value of 291 seconds is above the recommended check-in time of four minutes. Thus, the process is truly out of control and presents a performance that is not in accordance with the recommended performance levels for check-in. However, the new process presents definite improvements as illustrated in the control chart for the new check-in process presented below. Control Chart for the New Check-In Process The mean line for the process observations for the new check-in process is within the specified time value for check-in of four minutes and none of the observations has exceeded the upper control limit line. However, a few observations fall below the lower control limit line and this may indicate that the registration desk staff is now too fast. Hotel Escargo management can hope that the improvement is not adversely affecting the quality of interactions between the check-in staff and guests who must be welcomed and made to feel at home by spending time on them. Perhaps a bit of fine-tuning by managers is required and registration staff can be asked to try to delight guests some more. Control Chart for the Old Checkout Process The specifications for the checkout time require that the checkout processes for a guest be completed in 2 minutes, or 120 seconds. However, the mean line on the control chart indicates that, on the average, the checkout process takes 197.09 seconds. In addition, many observations are above and below the upper and lower control limits for the checkout process. Thus, the old checkout process, like the old check-in process, is well and truly out of control with improvements needed to present better performance, despite allowances for the essential requirement related to being polite, attentive to guests and for trying to create relationships between the hotel and the guest. The new checkout processes with the previously mentioned improvements that reduce the burden associated with a checkout for guests and permit the hotel staff to work on a prior request by a departing guest works better, as shown by the control chart for the new checkout process. The new mean time for guest checkout is now 106.19 seconds and this is well within the recommended time of two minutes. In addition, all of the observed measurements for the new checkout process are within both the upper and lower control limits presented on the control chart. Thus, a very well behaved new checkout process is now in place without any problems presented to Hotel Escargo managers for fine-tuning of the process. Control Chart for the New Checkout Process Monitoring and Control of the Room Service Performance using Six Sigma Quality Standards It is clear from an examination of the two control charts for the new check-in and checkout processes that these processes are now well behaved and perform in line with the quality measures established in by hospitality bodies for check-in and checkout time. However, it is important to maintain vigilance and to establish a monitoring process. Six Sigma is a philosophy that aims to reduce the number of defects in observations for service offerings to less than 3.4 in a million observations (12 Manage, 2009, “Six Sigma”) and (Yang, 2005, Pp. 12 -25). Six Sigma is applicable to service industries, including hospitality, manufacturing and a wide variety of other industries including banks, hospitals etc. Hotel Starwood, Marriott and many others have already resorted to using six sigma to bring about improvements in hotel areas, including front office operations, food, accommodation and billing etc (Slideshare, 2009, “Six Sigma Presentation Hospitality - Presentation Transcript”) and (Benchmark Six Sigma Open Forum, 2009, “Example Six Sigma Projects in a Hotel”). Clearly, a hotel wide implementation of Six Sigma that brings measurable service and performance improvements is expected and this means that measurements must guide continuous improvement to achieve the Six Sigma implementation goal and provide indication that existing processes function within the Six Sigma limit. For the check in and checkout processes, the most demanding phase in processing occurs during peak check-in and checkout times. Thus, one way of ensuring that the check-in and checkout processes are working well will be for a supervisor or other designated employee to monitor the check-in and checkout times and staff performance during peak hours. Even random sample records of times plotted on control charts will provide an indication about how well processes are performing and if the quality of service, which is an intangible attribute, is to the satisfaction of the hotel management and its guests. Random weekly samples should suffice, but the important thing is to try to observe and bring about improvement by analyzing the observed. Conclusion The discussion presented should elucidate the fact that the design of business processes in hotels and other hospitality service organizations has an impact on performance and quality of service delivered to guests. Thus, it makes sense for a hotel chain to try to pursue continuous improvement efforts and to aim for excellence in everything to remain competitive and to earn. The hotel industry has already seen large hotel chains embrace the Six Sigma philosophy in all areas of hotel operations because hotels cannot afford waste and a loss of image if they are to make profits. (This page intentionally left blank) Appendix A – Observations for Hotel Escargo Bibliography/ References 1. Aspatore Books Staff. (2004). Inside the Minds: The Hotel Business: Leading Hoteliers Offer a Behind the Scenes Glimpse Into the Hospitality Industry. Aspatore Books. 2. American Society for Quality, ASQ. (2009). Quality Tools. American Society for Quality. Retrieved: September 1, 2009, from: http://www.asq.org/about-asq/who-we-are/index.html 3. Bardi, James A. (2007). Hotel Front Office Management, Fourth Edition. John Wiley & Sons. 4. Benchmark Six Sigma Open Forum. (2009). Example Six Sigma Projects in a Hotel. 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The New Gold Standard: 5 Leadership Principles for Creating a Legendry Customer Experience, Courtesy of the Ritz-Carlton Hotel Company. McGraw Hill. 12. Rutherford, Denney G and O’Fallon, Michael J (Editors). (2007). Hotel Management and Operations, 4th Edition. John Wiley & Sons. 13. Salvendy, Gavriel. (2001). Handbook of Industrial Engineering: Technology and Operations Management, Third Edition. John Wiley & Sons. 14. Yang, Kai. (2005). Design for Six Sigma for Service. McGraw Hill. Read More