ADHM 360 Final: Final Exam Study Guide
20 Jun 2018
School
Department
Course
Professor
HR: Management of people to maximize employee performance
•
Responsible for:
Assisting other departments with human resources concerns
○
Handling recruitment, selection, orientation training, compensation and
appraisal
○
•
Influences:
External
Legislation
§
Competition
§
Demographic shift
§
Economy, ect.
§
○
Internal
Work procedures
§
Corporate culture, ect.
§
○
•
HR Functions
Recruitment
Activates designed to attract qualified applicants for the hotel's vacant
positions
§
Job analysis
A process of determining the specific tasks that must be done (job
description) as well as the knowledge and skills workers must have
in order to complete those tasks (job qualifications)
□
§
Internal Recruiting
Used when the best candidates for positions are believed to be
currently employed by the hotel
□
Advantages
Increased employee morale
®
Increased probability of making a good selection
®
Less costly
®
Reduced training time and costs
®
□
Disadvantages
Limited candidate pool
®
"Inbreeding"- Lose opportunities to bring new knowledge and
experience
®
Resentment among managers and employees
®
Recruitment and selection are still needed
®
□
§
○
Selection
Process of evaluating and selecting the most qualified candidates for the
vacant position
○
Use job qualification
A list of knowledge, skills and other requirements necessary to
perform the tasks described in a job description
§
○
Major selection tools
Applications
Completed by all candidates for employment□
The questions should be focus exclusively on job
qualifications; Avoid employment-related liability (Title VII of
Civil Rights Act of 1964)
□
Clearly state at-will nature of the employment relationship
Either party can terminate at anytime without liability
®
□
§
Interviews
Types of questions asked should focus on the applicant's job
skills and nothing else
□
Various employment-related laws limit the types of questions
that can be asked
Applicants age, origin, gender, religion marital status,
physical attributes or disabilities should not be asked
about or used as disqualifiers
®
Examples of illegal job interview questions
Child care arrangements
◊
How old are your children
◊
When did you graduate?
◊
Are you a U.S citizen
◊
Will you need personal time off for a particular
religious holidays?
◊
Are you comfortable working for a female boss
◊
How long do you plan to work until you retire
◊
Serious illnesses?
◊
®
□
§
Negligent hiring:
Failure of an employer to exercise reasonable care in the
selection of employees
Background checks are critical
–
}
Negligent retention
Retaining an employee after the employer becomes
aware of an employee's unsuitability for a job by failing
to act on that knowledge
–
}
§
○
○
Compensation management
Goal is to achieve fair, equitable, and competitive pay for all employees
§
The process of administrating an organization's extrinsic and intrinsic
reward system
Extrinsic rewards: typically financial rewards (salaries, incentive pay,
paid leave, preferred office space and computer)
□
Intrinsic rewards: self-initiated (e.g., personal growth, a sense of
accomplishment)
□
§
Basic techniques
Job Analysis- identifying characteristics of jobs and categorizing
them based on levels of responsibility and working conditions
□
Job evaluation- Ranking jobs according to the relative importance to
the organization
□
Pay surveys- pay rates of competitors□
§
○
Employment related laws
Title VII of Civil Rights Act of 1964
Prohibits employment decimation based on race, color, religion, sex
§
○
Fair Labor Standards Act
Minimum wage and overtime pay
Federal minimum wage is $7.25 per hour□
Tipped min wage is $2.13□
North Dakota- 7.25 (4.86 for tipped)□
Seattle, WA- $15 per hour by 2021□
§
○
Equal Pay act
When men and women perform work that's equal, they shall
receive equal pay
§
○
Age Discrimination Act
Prohibits employment discrimination against anyone between the
ages of 40 and 70
§
○
Genetic Information Nondiscrimination Act
Prohibit the use of genetic information in employment (GINA)
§
○
○
•
Characteristics of F & B
More complicated operation
Variety of offering -multiple outlets
Provide breakfast, lunch and dinner on a daily basis□
24-hour room service□
Banquet operations□
§
○
Revenue and profitability
Limited contribution to hotel revenue
Has been considered as a convenience for the guests rather a
revenue center
□
Room revenue: 60-75% vs F&B 20-35%□
Cost % is higher□
§
○
•
Personnel requirement
Director of Food and beverage
Food production
Executive chef□
Sous chef□
Banquet chef□
Pastry chef□
Assistant sous chef□
Purchasing clerk□
§
F & B management
Restaurant manager□
Assistant restaurant manager□
Beverage manger□
Catering services manager□
banquet maître d'□
§
○
•
Room Service operation
Characteristics of hotel room service operation
May not be profitable
High labor costs: charge up to a 25% premium□
§
Offered as an amenity and convenience to the guests
Impacts hotel rating□
§
Quality concerns
Time sensitivity of orders□
§
Communication issues
Communication is critical between the guest, order taker, food
production staff, and service staff
□
Technology helps improve accuracy□
§
○
•
Banquet operations
Characteristics of hotel banquet operation
The most profitable
The highest contribution margin (=food price-food costs)□
Planning production and labor is relatively easy
Number of meals and service time is known ahead of time
Banquet event order (BEO): Details all requirements for
a banquet; based on the formal contact between the
hotel and client
◊
®
Attrition- payment is guaranteed
®
□
Additional beverage sales- host or cash bars□
§
○
Service Style
Butler service
Appetizer and pre-poured champagnes can be served by service
staff at a reception while guests stand
□
§
Buffet Service
Quantities of food are pre-arranged on a self-service along the line;
guest pass and help themselves
§
§
Family Style
Platters and bowls of food are filled in the kitchen and brought to
guests' tables
§
§
French Service
Meals are prepared or finished at tableside by server
§
§
Plated service (American)
Production staff pre-portion food on plates in kitchen to serve to
guests
§
§
○
•
Bars and beverage service
Ways that beverages are sold
By the bottle
Pay for all the liquor bottles that are opened□
§
By the drink
Charged for each individual beverage consumed during the banquet□
§
Per person
Pre-set price x number of guests□
§
Charge per hour
Combine per person, per house (e.g. $25 per person for first house,
and $20 per person for second hour)
□
§
Open bar: "host bar"
§
Cash Bar: "no-host bar"
§
Combination bar: a host purchases tickets and gives each attendee a
certain number
Guest pay for additional drinks□
§
Limited consumption bar
The host establishes a dollar amount for drinks□
When the cash register reaches that amount, the bar is closed. □
§
○
Four types of illegal sales
Minors
○
Intoxicated persons
○
Outside legal hours
○
Improper liquor license
○
○
•
Hotel Liability and negligence
Innkeeper laws
All lodging operations have a legal duty to exercise "reasonable care" for
the safety of guests and their belongings
§
"Reasonable care"?
The degree of caution and concern for the safety of himself/herself
and others an ordinarily prudent and rational person would use in
the circumstances
□
§
Court Rulings on innkeepers laws vary from one jurisdiction to another
Stricter interpretation of "reasonable care" rules
Whether or not the hotel operator knew about the possibility
of the accidents
®
How much control the hotel operation had over the situation
®
□
§
Negligence
Failure to provide "reasonable care" to protect the guests from
"foreseeable acts"
□
Results in compensatory or punitive damages
Punishment for outrageous conduct as an example and a
deterrent to similar conduct
®
□
§
Sources of guest injuries
Hotel's premises include the hotel's courtesy shuttle, parking lots,
as well as inside the hotel
□
Common causes:
Slippery tubs and showers
®
Defective furniture/carpeting or flooring/lighting
®
Wet hard-surface floor
®
Broken glass
®
Bed bugs
®
Burns
®
Cracks in sidewalks and curbs
®
Drowning at swimming pool
®
□
§
○
•
Security Department
The roles of security function
Prevention and deterrence
§
Discovery and remedy
§
Detaining suspects for handover to law enforcement authorities
§
○
•
Developing a security program
Loss prevention committee
Includes general manager, department heads, line employees, ownership,
and local enforcement authorities
□
§
Program development procedure
Analyzing security vulnerability
Factors determining
Accessibility it public protection services
◊
Size and scope of operation
◊
®
□
Establishing security priorities
Identify every possible security risk
®
Evaluate the identified security risks
Probability of occurrence x degree of impact = security index
◊
Determine which risks are most likely to create the greatest
damages and losses
◊
®
□
Organizing a security system
Develop prevention and handling procedures
Determine levels of autonomy and reporting procedure
◊
®
Security Training
Security information included in the general orientation for
new hires
◊
General security training for all staff members
◊
Additional security information applicable to employees'
normal work and areas of responsibilities
◊
®
Records and Reports
Daily activity report
Details a security officer's patrols for the day or shift
}
◊
General incident report
Details any incidents that should be brought to the
attention of management
}
◊
Loss Report
Prepared to describe guest losses
}
◊
Monthly statistical report
◊
®
Security Technology
Not cheap, but more favorable risk coverage, fewer staff, and
lower payroll cost
◊
Electronic Key System
◊
Surveillance and monitoring
◊
Video Security- closed circuit television
◊
®
□
§
•
GM's Responsibilities
Property Management
Process of Planning, organizing, leading, and controlling human, financial,
and physical resources, to achieve organization goals
Planning: Setting up vision, mission, long-range plan, short-range
plan, operating budget
□
Organizing: Allocating responsibilities and authorizes within a hotel□
Leading: Influencing employees to accomplish organizational goals□
Controlling: Measuring accomplishment against the standards and
taking corrective action if necessary
□
§
○
Community Relations
Creating a positive relationship to the local community
Expand tourism opportunities□
Hire Local Residents□
Provide Input regarding local business community needs□
Have charity events and fundraisers at the hotel □
§
○
Investor Relations
The GM is an agent of ownership and investors
§
Implements the owner's vision
§
Respond to the owner's expectation
§
Effectively inform owners about current performance and future needs of
their hotel(s)
Develop and provide the annual report □
§
○
Brand Affiliation
Managing brand at property level
Continually monitor operational standards set by the brand to
ensure property performance
□
Communicate effectively with franchise brand officials about
marketing and sales programs
□
Improve profitable operation of hotel by using actives and programs
offered by the brand
□
§
Quality Inspection (assurance scores_
Result of annual (or more frequent) inspections by franchise
company
□
Used as measure of effectiveness of G.M □
§
○
•
GM Skills
Intellectual: Ability to collect, interpret, and use information logically
○
Interpersonal: understand and interact well with guests, employees, suppliers,
etc.
○
Administrative: Organize and direct required work efforts
○
Technical: Ability to perform management-specific aspects of the job
○
•
Revenue Management
Variable pricing strategy based on anticipating product demand in order to
maximize revenue for fixed, time-limited products (ex: hotel rooms, airline
seats, rental cars)
○
Originated in the airline industry
○
Max. revenue- increase: occupancy and room rates
○
•
Basics:
Economic principles of supply and demand
When supply is held constant, increase in demand results in increase in
price
§
When demand is held constant, increase in supply leads to decrease in
price
§
○
Demand-forecasting is key in the short term
Holds room rate high during times of high demand
§
Decreases room rates during times of low demand
§
○
•
Hotel Industry application
Capacity Management (CM)
Methods of controlling and limited room supply
Selective overbooking□
§
CM balances the risk of overselling rooms against the potential loss of
revenue arising from room spoilage
Room spoilage:
Rooms going unoccupied after the hotel stopped taking
reservations for a given date
®
□
Accurate forecast of cancellations and no-shows□
Overbook more rooms in lower priced categories
Upgrading to higher-priced rooms is acceptable
®
□
§
○
Discount Allocation (DA)
Involves restriction the time period and rooms available at reduced rates
§
Theory
Sales of a perishable item (guestrooms) at a reduced price is better
than no sales at all
□
§
Goals of DA
To protect enough remaining rooms at a higher rate to satisfy the
projected demand while filling rooms at a lower rate the would
otherwise have remained unsold
□
§
Requires a reliable mechanism for demand forecasting and analysis of
price elasticity in the market.
§
○
Duration Control (DC)
Places time constraints on accepting reservations in order to protect
sufficient space for multi-day request
A reservation for a one-night stay may be rejected, even though
space is available for that night
□
§
Can be combined with discount allocation
A three0night stay may be available for discount□
A one-night stay may require the rack rate□
§
○
•
Yield Statistic
The ratio of actual to potential (maximum) revenue
Actual revenue: revenue generated by number of rooms sold
§
Potential revenue: Revenue the would be received if all rooms were sold
at the rack their rack rates
§
○
Yield Statistic= Actual room revenue / potential room revenue
Or: = occupancy percentage x Achievement factor
Achievement factor = actual average room rate(ADR)/potential
average room rate
□
§
((# of rooms * occupancy rate) x ADR ) / potential room revenue = yield
statistic
§
Potential average daily rate: potential revenue / total rooms
§
○
•
Types of resorts
By proximity to primary markets
Destination/non-destination resorts
§
○
By seasonality
Year round/summer/ winter resorts
§
○
By setting and primary amenities
Beach, ocean, lake, ski, mountain, golf, casino, eco, resorts, guest ranches,
etc.
§
○
By ownership
Timeshare/vacation club
§
Condo Resort
§
○
•
Characteristics
Visitor Marker
Serve vacation and leisure segments of travel market, business-cum-
pleasure conferences, corporate incentive tour
§
○
Facilities
Rooms with adequate space to accommodate longer length stay
§
Extensive acreage to offer sports and recreational activities
§
Be in tune with attractions of host community.
§
○
Location
Resorts are often located in remote areas
Offer transportation□
Self-contained (e.g. storage facilities, self-contained waste disposal
systems)
□
Require on-premises housing and recreation facilities for employees□
§
○
More pronounced seasonality
20% of U.S resorts operate on a seasonal basis
Issues
Security and maintenance
®
Restoration and restocking of inventories
®
Human Resources
®
□
§
○
Corporate responsibility
Host communities are often heavily dependent on the resort employer for
its economic survival
§
Must consider welfare of the local comminutes
§
○
Labor Skills
Need to deal with greater flexibility of duties and responsibilities
§
Great deal of shifting of labor from one function to another.
§
○
Source of revenue
10-20% of revenue from recreation, retail, and concessions (6% in classic
hotels)
§
Ski resorts: 60% from ski lift, rental, and F&B
§
Casino: 72: from casino, 15% from rooms
§
Timeshare resorts: 25% from management fees
§
○
Greater Fixed assets
Land, building, and other fixed assets constitute a much larger percentage
of total assets
§
Little flexibility for alternative commercial use
§
Long payback period
§
○
•
Timeshare and vacation ownership
Timeshare
Multiple vacationers hold the rights to use the property
Managed by management companies□
Annual maintenance fees□
§
Also used for "interval ownership" and "vacation club ownership"
§
1,540+ timeshare resorts in the US
§
American Resort Development Association (ARDA)
§
Vacation exchange networks (e.g., Interval International, Resort
Condominium International)
§
○
Types
Deeded property ownership
Title-based property ownership□
§
Right-to-use ownership
The right of use or lease □
Has an expiration period with a renewal option □
§
○
Use
Fixed time
Use a particular week every year□
§
Floating time
Given a range of weeks to choose from each year□
Reservation in advance□
§
Point-based program
Use a predetermined allotment of points each year at different
properties
□
Most flexible □
§
○
•
•
Final Exam
Monday, May 7, 2018
8:00 PM
HR: Management of people to maximize employee performance•
Responsible for:
Assisting other departments with human resources concerns
○
Handling recruitment, selection, orientation training, compensation and
appraisal
○
•
Influences:
External
Legislation
§
Competition
§
Demographic shift
§
Economy, ect.
§
○
Internal
Work procedures
§
Corporate culture, ect.
§
○
•
HR Functions
Recruitment
Activates designed to attract qualified applicants for the hotel's vacant
positions
§
Job analysis
A process of determining the specific tasks that must be done (job
description) as well as the knowledge and skills workers must have
in order to complete those tasks (job qualifications)
□
§
Internal Recruiting
Used when the best candidates for positions are believed to be
currently employed by the hotel
□
Advantages
Increased employee morale
®
Increased probability of making a good selection
®
Less costly
®
Reduced training time and costs
®
□
Disadvantages
Limited candidate pool
®
"Inbreeding"- Lose opportunities to bring new knowledge and
experience
®
Resentment among managers and employees
®
Recruitment and selection are still needed
®
□
§
○
Selection
Process of evaluating and selecting the most qualified candidates for the
vacant position
○
Use job qualification
A list of knowledge, skills and other requirements necessary to
perform the tasks described in a job description
§
○
Major selection tools
Applications
Completed by all candidates for employment□
The questions should be focus exclusively on job
qualifications; Avoid employment-related liability (Title VII of
Civil Rights Act of 1964)
□
Clearly state at-will nature of the employment relationship
Either party can terminate at anytime without liability
®
□
§
Interviews
Types of questions asked should focus on the applicant's job
skills and nothing else
□
Various employment-related laws limit the types of questions
that can be asked
Applicants age, origin, gender, religion marital status,
physical attributes or disabilities should not be asked
about or used as disqualifiers
®
Examples of illegal job interview questions
Child care arrangements
◊
How old are your children
◊
When did you graduate?
◊
Are you a U.S citizen
◊
Will you need personal time off for a particular
religious holidays?
◊
Are you comfortable working for a female boss
◊
How long do you plan to work until you retire
◊
Serious illnesses?
◊
®
□
§
Negligent hiring:
Failure of an employer to exercise reasonable care in the
selection of employees
Background checks are critical
–
}
Negligent retention
Retaining an employee after the employer becomes
aware of an employee's unsuitability for a job by failing
to act on that knowledge
–
}
§
○
○
Compensation management
Goal is to achieve fair, equitable, and competitive pay for all employees
§
The process of administrating an organization's extrinsic and intrinsic
reward system
Extrinsic rewards: typically financial rewards (salaries, incentive pay,
paid leave, preferred office space and computer)
□
Intrinsic rewards: self-initiated (e.g., personal growth, a sense of
accomplishment)
□
§
Basic techniques
Job Analysis- identifying characteristics of jobs and categorizing
them based on levels of responsibility and working conditions
□
Job evaluation- Ranking jobs according to the relative importance to
the organization
□
Pay surveys- pay rates of competitors□
§
○
Employment related laws
Title VII of Civil Rights Act of 1964
Prohibits employment decimation based on race, color, religion, sex
§
○
Fair Labor Standards Act
Minimum wage and overtime pay
Federal minimum wage is $7.25 per hour□
Tipped min wage is $2.13□
North Dakota- 7.25 (4.86 for tipped)□
Seattle, WA- $15 per hour by 2021□
§
○
Equal Pay act
When men and women perform work that's equal, they shall
receive equal pay
§
○
Age Discrimination Act
Prohibits employment discrimination against anyone between the
ages of 40 and 70
§
○
Genetic Information Nondiscrimination Act
Prohibit the use of genetic information in employment (GINA)
§
○
○
•
Characteristics of F & B
More complicated operation
Variety of offering -multiple outlets
Provide breakfast, lunch and dinner on a daily basis□
24-hour room service□
Banquet operations□
§
○
Revenue and profitability
Limited contribution to hotel revenue
Has been considered as a convenience for the guests rather a
revenue center
□
Room revenue: 60-75% vs F&B 20-35%□
Cost % is higher□
§
○
•
Personnel requirement
Director of Food and beverage
Food production
Executive chef□
Sous chef□
Banquet chef□
Pastry chef□
Assistant sous chef□
Purchasing clerk□
§
F & B management
Restaurant manager□
Assistant restaurant manager□
Beverage manger□
Catering services manager□
banquet maître d'□
§
○
•
Room Service operation
Characteristics of hotel room service operation
May not be profitable
High labor costs: charge up to a 25% premium□
§
Offered as an amenity and convenience to the guests
Impacts hotel rating□
§
Quality concerns
Time sensitivity of orders□
§
Communication issues
Communication is critical between the guest, order taker, food
production staff, and service staff
□
Technology helps improve accuracy□
§
○
•
Banquet operations
Characteristics of hotel banquet operation
The most profitable
The highest contribution margin (=food price-food costs)□
Planning production and labor is relatively easy
Number of meals and service time is known ahead of time
Banquet event order (BEO): Details all requirements for
a banquet; based on the formal contact between the
hotel and client
◊
®
Attrition- payment is guaranteed
®
□
Additional beverage sales- host or cash bars□
§
○
Service Style
Butler service
Appetizer and pre-poured champagnes can be served by service
staff at a reception while guests stand
□
§
Buffet Service
Quantities of food are pre-arranged on a self-service along the line;
guest pass and help themselves
§
§
Family Style
Platters and bowls of food are filled in the kitchen and brought to
guests' tables
§
§
French Service
Meals are prepared or finished at tableside by server
§
§
Plated service (American)
Production staff pre-portion food on plates in kitchen to serve to
guests
§
§
○
•
Bars and beverage service
Ways that beverages are sold
By the bottle
Pay for all the liquor bottles that are opened□
§
By the drink
Charged for each individual beverage consumed during the banquet□
§
Per person
Pre-set price x number of guests□
§
Charge per hour
Combine per person, per house (e.g. $25 per person for first house,
and $20 per person for second hour)
□
§
Open bar: "host bar"
§
Cash Bar: "no-host bar"
§
Combination bar: a host purchases tickets and gives each attendee a
certain number
Guest pay for additional drinks□
§
Limited consumption bar
The host establishes a dollar amount for drinks□
When the cash register reaches that amount, the bar is closed. □
§
○
Four types of illegal sales
Minors
○
Intoxicated persons
○
Outside legal hours
○
Improper liquor license
○
○
•
Hotel Liability and negligence
Innkeeper laws
All lodging operations have a legal duty to exercise "reasonable care" for
the safety of guests and their belongings
§
"Reasonable care"?
The degree of caution and concern for the safety of himself/herself
and others an ordinarily prudent and rational person would use in
the circumstances
□
§
Court Rulings on innkeepers laws vary from one jurisdiction to another
Stricter interpretation of "reasonable care" rules
Whether or not the hotel operator knew about the possibility
of the accidents
®
How much control the hotel operation had over the situation
®
□
§
Negligence
Failure to provide "reasonable care" to protect the guests from
"foreseeable acts"
□
Results in compensatory or punitive damages
Punishment for outrageous conduct as an example and a
deterrent to similar conduct
®
□
§
Sources of guest injuries
Hotel's premises include the hotel's courtesy shuttle, parking lots,
as well as inside the hotel
□
Common causes:
Slippery tubs and showers
®
Defective furniture/carpeting or flooring/lighting
®
Wet hard-surface floor
®
Broken glass
®
Bed bugs
®
Burns
®
Cracks in sidewalks and curbs
®
Drowning at swimming pool
®
□
§
○
•
Security Department
The roles of security function
Prevention and deterrence
§
Discovery and remedy
§
Detaining suspects for handover to law enforcement authorities
§
○
•
Developing a security program
Loss prevention committee
Includes general manager, department heads, line employees, ownership,
and local enforcement authorities
□
§
Program development procedure
Analyzing security vulnerability
Factors determining
Accessibility it public protection services
◊
Size and scope of operation
◊
®
□
Establishing security priorities
Identify every possible security risk
®
Evaluate the identified security risks
Probability of occurrence x degree of impact = security index
◊
Determine which risks are most likely to create the greatest
damages and losses
◊
®
□
Organizing a security system
Develop prevention and handling procedures
Determine levels of autonomy and reporting procedure
◊
®
Security Training
Security information included in the general orientation for
new hires
◊
General security training for all staff members
◊
Additional security information applicable to employees'
normal work and areas of responsibilities
◊
®
Records and Reports
Daily activity report
Details a security officer's patrols for the day or shift
}
◊
General incident report
Details any incidents that should be brought to the
attention of management
}
◊
Loss Report
Prepared to describe guest losses
}
◊
Monthly statistical report
◊
®
Security Technology
Not cheap, but more favorable risk coverage, fewer staff, and
lower payroll cost
◊
Electronic Key System
◊
Surveillance and monitoring
◊
Video Security- closed circuit television
◊
®
□
§
•
GM's Responsibilities
Property Management
Process of Planning, organizing, leading, and controlling human, financial,
and physical resources, to achieve organization goals
Planning: Setting up vision, mission, long-range plan, short-range
plan, operating budget
□
Organizing: Allocating responsibilities and authorizes within a hotel□
Leading: Influencing employees to accomplish organizational goals□
Controlling: Measuring accomplishment against the standards and
taking corrective action if necessary
□
§
○
Community Relations
Creating a positive relationship to the local community
Expand tourism opportunities□
Hire Local Residents□
Provide Input regarding local business community needs□
Have charity events and fundraisers at the hotel □
§
○
Investor Relations
The GM is an agent of ownership and investors
§
Implements the owner's vision
§
Respond to the owner's expectation
§
Effectively inform owners about current performance and future needs of
their hotel(s)
Develop and provide the annual report □
§
○
Brand Affiliation
Managing brand at property level
Continually monitor operational standards set by the brand to
ensure property performance
□
Communicate effectively with franchise brand officials about
marketing and sales programs
□
Improve profitable operation of hotel by using actives and programs
offered by the brand
□
§
Quality Inspection (assurance scores_
Result of annual (or more frequent) inspections by franchise
company
□
Used as measure of effectiveness of G.M □
§
○
•
GM Skills
Intellectual: Ability to collect, interpret, and use information logically
○
Interpersonal: understand and interact well with guests, employees, suppliers,
etc.
○
Administrative: Organize and direct required work efforts
○
Technical: Ability to perform management-specific aspects of the job
○
•
Revenue Management
Variable pricing strategy based on anticipating product demand in order to
maximize revenue for fixed, time-limited products (ex: hotel rooms, airline
seats, rental cars)
○
Originated in the airline industry
○
Max. revenue- increase: occupancy and room rates
○
•
Basics:
Economic principles of supply and demand
When supply is held constant, increase in demand results in increase in
price
§
When demand is held constant, increase in supply leads to decrease in
price
§
○
Demand-forecasting is key in the short term
Holds room rate high during times of high demand
§
Decreases room rates during times of low demand
§
○
•
Hotel Industry application
Capacity Management (CM)
Methods of controlling and limited room supply
Selective overbooking□
§
CM balances the risk of overselling rooms against the potential loss of
revenue arising from room spoilage
Room spoilage:
Rooms going unoccupied after the hotel stopped taking
reservations for a given date
®
□
Accurate forecast of cancellations and no-shows□
Overbook more rooms in lower priced categories
Upgrading to higher-priced rooms is acceptable
®
□
§
○
Discount Allocation (DA)
Involves restriction the time period and rooms available at reduced rates
§
Theory
Sales of a perishable item (guestrooms) at a reduced price is better
than no sales at all
□
§
Goals of DA
To protect enough remaining rooms at a higher rate to satisfy the
projected demand while filling rooms at a lower rate the would
otherwise have remained unsold
□
§
Requires a reliable mechanism for demand forecasting and analysis of
price elasticity in the market.
§
○
Duration Control (DC)
Places time constraints on accepting reservations in order to protect
sufficient space for multi-day request
A reservation for a one-night stay may be rejected, even though
space is available for that night
□
§
Can be combined with discount allocation
A three0night stay may be available for discount□
A one-night stay may require the rack rate□
§
○
•
Yield Statistic
The ratio of actual to potential (maximum) revenue
Actual revenue: revenue generated by number of rooms sold
§
Potential revenue: Revenue the would be received if all rooms were sold
at the rack their rack rates
§
○
Yield Statistic= Actual room revenue / potential room revenue
Or: = occupancy percentage x Achievement factor
Achievement factor = actual average room rate(ADR)/potential
average room rate
□
§
((# of rooms * occupancy rate) x ADR ) / potential room revenue = yield
statistic
§
Potential average daily rate: potential revenue / total rooms
§
○
•
Types of resorts
By proximity to primary markets
Destination/non-destination resorts
§
○
By seasonality
Year round/summer/ winter resorts
§
○
By setting and primary amenities
Beach, ocean, lake, ski, mountain, golf, casino, eco, resorts, guest ranches,
etc.
§
○
By ownership
Timeshare/vacation club
§
Condo Resort
§
○
•
Characteristics
Visitor Marker
Serve vacation and leisure segments of travel market, business-cum-
pleasure conferences, corporate incentive tour
§
○
Facilities
Rooms with adequate space to accommodate longer length stay
§
Extensive acreage to offer sports and recreational activities
§
Be in tune with attractions of host community.
§
○
Location
Resorts are often located in remote areas
Offer transportation□
Self-contained (e.g. storage facilities, self-contained waste disposal
systems)
□
Require on-premises housing and recreation facilities for employees□
§
○
More pronounced seasonality
20% of U.S resorts operate on a seasonal basis
Issues
Security and maintenance
®
Restoration and restocking of inventories
®
Human Resources
®
□
§
○
Corporate responsibility
Host communities are often heavily dependent on the resort employer for
its economic survival
§
Must consider welfare of the local comminutes
§
○
Labor Skills
Need to deal with greater flexibility of duties and responsibilities
§
Great deal of shifting of labor from one function to another.
§
○
Source of revenue
10-20% of revenue from recreation, retail, and concessions (6% in classic
hotels)
§
Ski resorts: 60% from ski lift, rental, and F&B
§
Casino: 72: from casino, 15% from rooms
§
Timeshare resorts: 25% from management fees
§
○
Greater Fixed assets
Land, building, and other fixed assets constitute a much larger percentage
of total assets
§
Little flexibility for alternative commercial use
§
Long payback period
§
○
•
Timeshare and vacation ownership
Timeshare
Multiple vacationers hold the rights to use the property
Managed by management companies□
Annual maintenance fees□
§
Also used for "interval ownership" and "vacation club ownership"
§
1,540+ timeshare resorts in the US
§
American Resort Development Association (ARDA)
§
Vacation exchange networks (e.g., Interval International, Resort
Condominium International)
§
○
Types
Deeded property ownership
Title-based property ownership□
§
Right-to-use ownership
The right of use or lease □
Has an expiration period with a renewal option □
§
○
Use
Fixed time
Use a particular week every year□
§
Floating time
Given a range of weeks to choose from each year□
Reservation in advance□
§
Point-based program
Use a predetermined allotment of points each year at different
properties
□
Most flexible □
§
○
•
•
Final Exam
Monday, May 7, 2018
8:00 PM
HR: Management of people to maximize employee performance•
Responsible for:
Assisting other departments with human resources concerns
○
Handling recruitment, selection, orientation training, compensation and
appraisal
○
•
Influences:
External
Legislation
§
Competition
§
Demographic shift
§
Economy, ect.
§
○
Internal
Work procedures
§
Corporate culture, ect.
§
○
•
HR Functions
Recruitment
Activates designed to attract qualified applicants for the hotel's vacant
positions
§
Job analysis
A process of determining the specific tasks that must be done (job
description) as well as the knowledge and skills workers must have
in order to complete those tasks (job qualifications)
□
§
Internal Recruiting
Used when the best candidates for positions are believed to be
currently employed by the hotel
□
Advantages
Increased employee morale
®
Increased probability of making a good selection
®
Less costly
®
Reduced training time and costs
®
□
Disadvantages
Limited candidate pool
®
"Inbreeding"- Lose opportunities to bring new knowledge and
experience
®
Resentment among managers and employees
®
Recruitment and selection are still needed
®
□
§
○
Selection
Process of evaluating and selecting the most qualified candidates for the
vacant position
○
Use job qualification
A list of knowledge, skills and other requirements necessary to
perform the tasks described in a job description
§
○
Major selection tools
Applications
Completed by all candidates for employment
□
The questions should be focus exclusively on job
qualifications; Avoid employment-related liability (Title VII of
Civil Rights Act of 1964)
□
Clearly state at-will nature of the employment relationship
Either party can terminate at anytime without liability
®
□
§
Interviews
Types of questions asked should focus on the applicant's job
skills and nothing else
□
Various employment-related laws limit the types of questions
that can be asked
Applicants age, origin, gender, religion marital status,
physical attributes or disabilities should not be asked
about or used as disqualifiers
®
Examples of illegal job interview questions
Child care arrangements
◊
How old are your children
◊
When did you graduate?
◊
Are you a U.S citizen
◊
Will you need personal time off for a particular
religious holidays?
◊
Are you comfortable working for a female boss
◊
How long do you plan to work until you retire
◊
Serious illnesses?
◊
®
□
§
Negligent hiring:
Failure of an employer to exercise reasonable care in the
selection of employees
Background checks are critical
–
}
Negligent retention
Retaining an employee after the employer becomes
aware of an employee's unsuitability for a job by failing
to act on that knowledge
–
}
§
○
○
Compensation management
Goal is to achieve fair, equitable, and competitive pay for all employees
§
The process of administrating an organization's extrinsic and intrinsic
reward system
Extrinsic rewards: typically financial rewards (salaries, incentive pay,
paid leave, preferred office space and computer)
□
Intrinsic rewards: self-initiated (e.g., personal growth, a sense of
accomplishment)
□
§
Basic techniques
Job Analysis- identifying characteristics of jobs and categorizing
them based on levels of responsibility and working conditions
□
Job evaluation- Ranking jobs according to the relative importance to
the organization
□
Pay surveys- pay rates of competitors□
§
○
Employment related laws
Title VII of Civil Rights Act of 1964
Prohibits employment decimation based on race, color, religion, sex
§
○
Fair Labor Standards Act
Minimum wage and overtime pay
Federal minimum wage is $7.25 per hour□
Tipped min wage is $2.13□
North Dakota- 7.25 (4.86 for tipped)□
Seattle, WA- $15 per hour by 2021□
§
○
Equal Pay act
When men and women perform work that's equal, they shall
receive equal pay
§
○
Age Discrimination Act
Prohibits employment discrimination against anyone between the
ages of 40 and 70
§
○
Genetic Information Nondiscrimination Act
Prohibit the use of genetic information in employment (GINA)
§
○
○
•
Characteristics of F & B
More complicated operation
Variety of offering -multiple outlets
Provide breakfast, lunch and dinner on a daily basis□
24-hour room service□
Banquet operations□
§
○
Revenue and profitability
Limited contribution to hotel revenue
Has been considered as a convenience for the guests rather a
revenue center
□
Room revenue: 60-75% vs F&B 20-35%□
Cost % is higher□
§
○
•
Personnel requirement
Director of Food and beverage
Food production
Executive chef□
Sous chef□
Banquet chef□
Pastry chef□
Assistant sous chef□
Purchasing clerk□
§
F & B management
Restaurant manager□
Assistant restaurant manager□
Beverage manger□
Catering services manager□
banquet maître d'□
§
○
•
Room Service operation
Characteristics of hotel room service operation
May not be profitable
High labor costs: charge up to a 25% premium□
§
Offered as an amenity and convenience to the guests
Impacts hotel rating□
§
Quality concerns
Time sensitivity of orders□
§
Communication issues
Communication is critical between the guest, order taker, food
production staff, and service staff
□
Technology helps improve accuracy□
§
○
•
Banquet operations
Characteristics of hotel banquet operation
The most profitable
The highest contribution margin (=food price-food costs)□
Planning production and labor is relatively easy
Number of meals and service time is known ahead of time
Banquet event order (BEO): Details all requirements for
a banquet; based on the formal contact between the
hotel and client
◊
®
Attrition- payment is guaranteed
®
□
Additional beverage sales- host or cash bars□
§
○
Service Style
Butler service
Appetizer and pre-poured champagnes can be served by service
staff at a reception while guests stand
□
§
Buffet Service
Quantities of food are pre-arranged on a self-service along the line;
guest pass and help themselves
§
§
Family Style
Platters and bowls of food are filled in the kitchen and brought to
guests' tables
§
§
French Service
Meals are prepared or finished at tableside by server
§
§
Plated service (American)
Production staff pre-portion food on plates in kitchen to serve to
guests
§
§
○
•
Bars and beverage service
Ways that beverages are sold
By the bottle
Pay for all the liquor bottles that are opened□
§
By the drink
Charged for each individual beverage consumed during the banquet□
§
Per person
Pre-set price x number of guests□
§
Charge per hour
Combine per person, per house (e.g. $25 per person for first house,
and $20 per person for second hour)
□
§
Open bar: "host bar"
§
Cash Bar: "no-host bar"
§
Combination bar: a host purchases tickets and gives each attendee a
certain number
Guest pay for additional drinks□
§
Limited consumption bar
The host establishes a dollar amount for drinks□
When the cash register reaches that amount, the bar is closed. □
§
○
Four types of illegal sales
Minors
○
Intoxicated persons
○
Outside legal hours
○
Improper liquor license
○
○
•
Hotel Liability and negligence
Innkeeper laws
All lodging operations have a legal duty to exercise "reasonable care" for
the safety of guests and their belongings
§
"Reasonable care"?
The degree of caution and concern for the safety of himself/herself
and others an ordinarily prudent and rational person would use in
the circumstances
□
§
Court Rulings on innkeepers laws vary from one jurisdiction to another
Stricter interpretation of "reasonable care" rules
Whether or not the hotel operator knew about the possibility
of the accidents
®
How much control the hotel operation had over the situation
®
□
§
Negligence
Failure to provide "reasonable care" to protect the guests from
"foreseeable acts"
□
Results in compensatory or punitive damages
Punishment for outrageous conduct as an example and a
deterrent to similar conduct
®
□
§
Sources of guest injuries
Hotel's premises include the hotel's courtesy shuttle, parking lots,
as well as inside the hotel
□
Common causes:
Slippery tubs and showers
®
Defective furniture/carpeting or flooring/lighting
®
Wet hard-surface floor
®
Broken glass
®
Bed bugs
®
Burns
®
Cracks in sidewalks and curbs
®
Drowning at swimming pool
®
□
§
○
•
Security Department
The roles of security function
Prevention and deterrence
§
Discovery and remedy
§
Detaining suspects for handover to law enforcement authorities
§
○
•
Developing a security program
Loss prevention committee
Includes general manager, department heads, line employees, ownership,
and local enforcement authorities
□
§
Program development procedure
Analyzing security vulnerability
Factors determining
Accessibility it public protection services
◊
Size and scope of operation
◊
®
□
Establishing security priorities
Identify every possible security risk
®
Evaluate the identified security risks
Probability of occurrence x degree of impact = security index
◊
Determine which risks are most likely to create the greatest
damages and losses
◊
®
□
Organizing a security system
Develop prevention and handling procedures
Determine levels of autonomy and reporting procedure
◊
®
Security Training
Security information included in the general orientation for
new hires
◊
General security training for all staff members
◊
Additional security information applicable to employees'
normal work and areas of responsibilities
◊
®
Records and Reports
Daily activity report
Details a security officer's patrols for the day or shift
}
◊
General incident report
Details any incidents that should be brought to the
attention of management
}
◊
Loss Report
Prepared to describe guest losses
}
◊
Monthly statistical report
◊
®
Security Technology
Not cheap, but more favorable risk coverage, fewer staff, and
lower payroll cost
◊
Electronic Key System
◊
Surveillance and monitoring
◊
Video Security- closed circuit television
◊
®
□
§
•
GM's Responsibilities
Property Management
Process of Planning, organizing, leading, and controlling human, financial,
and physical resources, to achieve organization goals
Planning: Setting up vision, mission, long-range plan, short-range
plan, operating budget
□
Organizing: Allocating responsibilities and authorizes within a hotel□
Leading: Influencing employees to accomplish organizational goals□
Controlling: Measuring accomplishment against the standards and
taking corrective action if necessary
□
§
○
Community Relations
Creating a positive relationship to the local community
Expand tourism opportunities□
Hire Local Residents□
Provide Input regarding local business community needs□
Have charity events and fundraisers at the hotel □
§
○
Investor Relations
The GM is an agent of ownership and investors
§
Implements the owner's vision
§
Respond to the owner's expectation
§
Effectively inform owners about current performance and future needs of
their hotel(s)
Develop and provide the annual report □
§
○
Brand Affiliation
Managing brand at property level
Continually monitor operational standards set by the brand to
ensure property performance
□
Communicate effectively with franchise brand officials about
marketing and sales programs
□
Improve profitable operation of hotel by using actives and programs
offered by the brand
□
§
Quality Inspection (assurance scores_
Result of annual (or more frequent) inspections by franchise
company
□
Used as measure of effectiveness of G.M □
§
○
•
GM Skills
Intellectual: Ability to collect, interpret, and use information logically
○
Interpersonal: understand and interact well with guests, employees, suppliers,
etc.
○
Administrative: Organize and direct required work efforts
○
Technical: Ability to perform management-specific aspects of the job
○
•
Revenue Management
Variable pricing strategy based on anticipating product demand in order to
maximize revenue for fixed, time-limited products (ex: hotel rooms, airline
seats, rental cars)
○
Originated in the airline industry
○
Max. revenue- increase: occupancy and room rates
○
•
Basics:
Economic principles of supply and demand
When supply is held constant, increase in demand results in increase in
price
§
When demand is held constant, increase in supply leads to decrease in
price
§
○
Demand-forecasting is key in the short term
Holds room rate high during times of high demand
§
Decreases room rates during times of low demand
§
○
•
Hotel Industry application
Capacity Management (CM)
Methods of controlling and limited room supply
Selective overbooking□
§
CM balances the risk of overselling rooms against the potential loss of
revenue arising from room spoilage
Room spoilage:
Rooms going unoccupied after the hotel stopped taking
reservations for a given date
®
□
Accurate forecast of cancellations and no-shows□
Overbook more rooms in lower priced categories
Upgrading to higher-priced rooms is acceptable
®
□
§
○
Discount Allocation (DA)
Involves restriction the time period and rooms available at reduced rates
§
Theory
Sales of a perishable item (guestrooms) at a reduced price is better
than no sales at all
□
§
Goals of DA
To protect enough remaining rooms at a higher rate to satisfy the
projected demand while filling rooms at a lower rate the would
otherwise have remained unsold
□
§
Requires a reliable mechanism for demand forecasting and analysis of
price elasticity in the market.
§
○
Duration Control (DC)
Places time constraints on accepting reservations in order to protect
sufficient space for multi-day request
A reservation for a one-night stay may be rejected, even though
space is available for that night
□
§
Can be combined with discount allocation
A three0night stay may be available for discount□
A one-night stay may require the rack rate□
§
○
•
Yield Statistic
The ratio of actual to potential (maximum) revenue
Actual revenue: revenue generated by number of rooms sold
§
Potential revenue: Revenue the would be received if all rooms were sold
at the rack their rack rates
§
○
Yield Statistic= Actual room revenue / potential room revenue
Or: = occupancy percentage x Achievement factor
Achievement factor = actual average room rate(ADR)/potential
average room rate
□
§
((# of rooms * occupancy rate) x ADR ) / potential room revenue = yield
statistic
§
Potential average daily rate: potential revenue / total rooms
§
○
•
Types of resorts
By proximity to primary markets
Destination/non-destination resorts
§
○
By seasonality
Year round/summer/ winter resorts
§
○
By setting and primary amenities
Beach, ocean, lake, ski, mountain, golf, casino, eco, resorts, guest ranches,
etc.
§
○
By ownership
Timeshare/vacation club
§
Condo Resort
§
○
•
Characteristics
Visitor Marker
Serve vacation and leisure segments of travel market, business-cum-
pleasure conferences, corporate incentive tour
§
○
Facilities
Rooms with adequate space to accommodate longer length stay
§
Extensive acreage to offer sports and recreational activities
§
Be in tune with attractions of host community.
§
○
Location
Resorts are often located in remote areas
Offer transportation□
Self-contained (e.g. storage facilities, self-contained waste disposal
systems)
□
Require on-premises housing and recreation facilities for employees□
§
○
More pronounced seasonality
20% of U.S resorts operate on a seasonal basis
Issues
Security and maintenance
®
Restoration and restocking of inventories
®
Human Resources
®
□
§
○
Corporate responsibility
Host communities are often heavily dependent on the resort employer for
its economic survival
§
Must consider welfare of the local comminutes
§
○
Labor Skills
Need to deal with greater flexibility of duties and responsibilities
§
Great deal of shifting of labor from one function to another.
§
○
Source of revenue
10-20% of revenue from recreation, retail, and concessions (6% in classic
hotels)
§
Ski resorts: 60% from ski lift, rental, and F&B
§
Casino: 72: from casino, 15% from rooms
§
Timeshare resorts: 25% from management fees
§
○
Greater Fixed assets
Land, building, and other fixed assets constitute a much larger percentage
of total assets
§
Little flexibility for alternative commercial use
§
Long payback period
§
○
•
Timeshare and vacation ownership
Timeshare
Multiple vacationers hold the rights to use the property
Managed by management companies□
Annual maintenance fees□
§
Also used for "interval ownership" and "vacation club ownership"
§
1,540+ timeshare resorts in the US
§
American Resort Development Association (ARDA)
§
Vacation exchange networks (e.g., Interval International, Resort
Condominium International)
§
○
Types
Deeded property ownership
Title-based property ownership□
§
Right-to-use ownership
The right of use or lease □
Has an expiration period with a renewal option □
§
○
Use
Fixed time
Use a particular week every year□
§
Floating time
Given a range of weeks to choose from each year□
Reservation in advance□
§
Point-based program
Use a predetermined allotment of points each year at different
properties
□
Most flexible □
§
○
•
•
Final Exam
Monday, May 7, 2018 8:00 PM
Document Summary
Hr: management of people to maximize employee performance. Handling recruitment, selection, orientation training, compensation and appraisal. Activates designed to attract qualified applicants for the hotel"s vacant positions. A process of determining the specific tasks that must be done (job description) as well as the knowledge and skills workers must have in order to complete those tasks (job qualifications) Used when the best candidates for positions are believed to be currently employed by the hotel. inbreeding- lose opportunities to bring new knowledge and experience. Process of evaluating and selecting the most qualified candidates for the vacant position. A list of knowledge, skills and other requirements necessary to perform the tasks described in a job description. The questions should be focus exclusively on job qualifications; avoid employment-related liability (title vii of. Clearly state at-will nature of the employment relationship. Either party can terminate at anytime without liability. Types of questions asked should focus on the applicant"s job skills and nothing else.
