The purpose of this report is to evaluate operation management practices related to the hospitality industry. These kinds of practices assist in developing service quality in order to provide desired and required services to customers by analyzing their demand.
- Critically evaluate how the operational performance of an organisation can be improved by implementing different services management theory.
- Analyze different operational as well as services management theory in the context of Hilton hotels.
In present scenario, due to intense competition and continuous changing business environment, many companies have to face problems in maintaining the quality products. Nowadays the business is considered as complex system that is involved in activities that requires effective planning and supervision. Operational management is defined as the procedure which includes several activities such as production planning, organising, directing, controlling and manufacturing of products. This process also includes redesigning of operational system. Objectives of operational management is to allow a firm to focus on deliveries of goods and services. It supports management team in ensuring that business entity has successfully turns inputs to outputs in efficient manner.
The purpose of this report is to identify several issues by an organisation in relation to operational activities. It also focuses on identifying techniques or methods which can be adopted by an enterprise for resolving the various problems related to business operations in context of Hilton Hotel.
Definition and importance of operational management
Operational management intends to assist business entity in improving the quality of services and enhancing the customers’ services. It is very essential for an organisation to bring improvement in operational procedure for increasing profitability and sales. Effective operational management system also helps business entity in delivering high level of satisfaction to customers. It also supports firm in increasing productivity and sales.
There are some internals as well as external factors which can have direct as well as significant influence on the production of operational system. These variables can create barriers in the business operations. Operational issues also have negative impact on the profitability as well as sales of firm. It also sometimes leads to the wastage of resources. Problems related to operational activity have adverse effect on business performance, impact strategy execution and growth of firm (Heizer, 2016)
Operational issues faced by Hilton Hotel
Hilton hotel has gained the popularity as well as customer loyalty by delivering good quality of products or services to customers. Business entity also has also maintained its standard. There are certain problems faced by Hilton hotel due to some issues in operational procedures or system. Due to this factor the company has to face difficult situation as many of clients were complaining about the quality of food. These problems have direct as well as significant impact on the customers’ services as well as quality of products or services. Due to technical fault in operational system and lack of training new staff, business entity is facing difficulty in maintaining the balance between demand and supply. Due to which customers who visit hotel have to wait for long in a queue. Delay in delivery of products as well as services have lead to the high level of dissatisfaction among clients. It also has an adverse impact on the sales as well as reputation of a company. Due to the untrained and unskilled employees there are issues related handling the positive and negative aspects of complaints on the employees.
The hotel industry comprised of businesses that provide accommodations to travellers as well as other amenities. Hotel businesses come with unique aspects that make it more challenging. Hotels are open 24 hours and seven services provided by an organisation in order to enable guest to gain a good experience. In addition to this, another issue faced by the Hilton hotel include shortage of labour. This is the biggest issue which leads to decline in production and create big barriers in operational activities. It also has great influence on the working efficiency of firm. Hilton hotel is facing this specific problem due to failure to attract skilled workforce and also high level of dissatisfaction among existing staff members (Kroll, 2015)
Ineffective operational management system has to increase in the cost of production which has further lead to the compromise in the quality of products or services. Company has failed to fulfil the expectation of the client which has negative effect on sales as well as profitability of firm. In addition to this all these major issues faced by an organisation due to ineffective operational management system and increase in competition.
There are several problems such as location, integration, affiliation, configuration, organisation, implementation and adaptation of operational procedures or system. Several other operational issues faced by the Hilton hotel include bad food image, the reason for this problem is ineffective operational management system. Lack of flexibility in operational strategy as well as system has lead to the inconsistent quality of food item which has Further, resulted into inconsistent quality of products. Price sensitivity is another major issue due to which an organisation faces difficulty in increasing profit margins. Increase in competition and strategies adopted by the competitors have diverted the attention of Hilton hotel, this is the significant reason for occurrence of several problems. Due to lack of resources including funds business entity is facing difficulty in fulfilling the orders. Poor financial condition has great as well as significant influence on the buying power of an organisation (Burke and Noumair, 2015)
The another major problems issued faced by Hilton hotel is difficulty in maintaining balance between demand and supply of goods or services due to continuous change in social as well as economic factors. In present scenario, customers are more concerned about the quality of products rather than price. Hilton hotel has to face legal obligations due to business operations which ha negative effect on the health of people as well as on environment. The other major issues faced by the Hilton hotel is the image of the organisation was affected, perhaps the public trust and customer loyalty to its products decreased owing to its contribution to health risks associated with the development of obesity. The another major challenge that arises in the development of various strategies in developing a consistent consumer base (Starr and Gupta, 2017)
The other problem that is faced by the Hilton Hotel is related to the difference in opinion of customers as well as people in the society. This factor has direct influence on the production planning as well as operational strategies adopted by firm. As a management team in Hilton hotel perceives that the three aspects such as quality, love and aspirations are three important attributes which will assist business entity in gaining the customer loyalty. Whereas, the customer opinion about the business operations of Hilton hotel is the grossly and inconceivable nature of irresponsibility and the health risks that eating at the restaurant means to their health. Due to weak network of supplies the company was facing the difficulty in making the delivery of goods or services on time. These variables have effect on the behaviour of customers towards organisation. Customer services were another big problem faced by the Hilton hotel. These issues have occurred to the lack of effective leadership and lack of training by workers. The menu is too complex, which led to the inconsistencies as well as compromise in quality of food item (Agarwal and et.al, 2012)
Theories for improving operational issues
It is important for Hilton Hotel to improve its operational issues. It will help them to increase their efficiency and customer satisfaction. This will lead to increase in sales and profits. Due to this they will be able to retain their customer thus maintaining its customer base. In addition, improving operations will help Hilton Hotel to grow and develop in other areas. It will help in enhancing service quality and eliminating loop wholes within process (Llach, Martí and Rocafort, 2016) Moreover, it will be useful in reducing delivery time and providing service in right time. For this, various theories can be used. It will help in improving process by redesigning it. Performance improvement is a process of changing resources or process that results in efficiency and effectiveness. Generally, there are two areas in which this can be done. They are productivity and efficiency. Productivity can be improved by changing input and output process. Efficiency can be improved by speed, flexibility, performance, etc.
Business process improvement- It is a method through which business process can be redesigned. It involves restructuring of entire processes so that it services can be delivered in right time (Schuckert, Liu and Law, 2015) In contains starting and ending of process in which all activities are analysed. By making modifications in various parts of methods waiting time can be reduced.
Just in time approach- This process was initiated by Toyota Company in order to improve their product quality by making continuous changes in production process. By implementing this method, cost and time is reduced. Also, it helps in making continuous improvement in process so that efficiency can be increased (Thomé, Scavarda and Scavarda, 2016) Moreover, it involves efforts of every employee and manager in doing this.
Hilton Hotel can use this method for improving their process. Organisation can review entire process so that it becomes easy to find out areas where operations are getting affected. Furthermore, it will be help in improving one stage, so change in one stage will automatically improve the next one. Thus, in this way overall process can be enhanced. Along with this, it will help in providing extra services to people. It will make it easier to manage and maintain customer relationship and services.
Kaizen – It is a method in which operations can be improved by eliminating waste. It is done by making continuous improvements in process or implementing certain extra methods. Here by necessitating process to a specific limit the efficiency can be enhanced (Pirani and Arafat, 2014)
Hilton Hotel can make their process flexible by reducing it. For this continuous improvements can be done so that waiting time can be reduced. This will help in providing timely delivery of services to customers. In kaizen process five S are used. These are as follows:-
- Sort – It this things can be eliminated that are making the process complex. After that things can be sorted by including what is needed. It can be done by prioritising things.
- Straighten – In this the first thing can be put at top that is of high priority. This enable in quick working of operations and delivering basic services in right time.