Operations Management in the Hospitality Industry

Introduction

Improving the operational efficiency of businesses is a critical part of modern corporate management, and the tourism and hospitality sector is not any different. Companies are constantly looking for new ways of optimizing their profitability while keeping their running costs low (Benckendorff, Xiang and Sheldon, 2019; Cheong et al., 2017; Gao et al., 2016). This desire has forced them to look for more innovative ways of managing their operations. The success of the process lies in their understanding of operational management processes that are responsible for service delivery (Cheong et al., 2017; Gao et al., 2016). In this paper, technology will be proposed as an advanced tool for managing the operational challenge of a Shanghai-based bank using its customer check-in process as the main basis of evaluation.

Key sections of this paper will explore the concept of operations management and explain how it fits within the larger framework of the case study involving the three-star Chinese hotel. Additionally, the case study will highlight the extent that changes to operational management practices would have on the overall health of the company’s business processes by focusing on its impact on consumer trust, innovation, and efficiency. These insights will show that automation has the potential of solving some of the operational challenges of the Shanghai-based hotel. However, the proposals need to be implemented prudently and with the support of all relevant stakeholders.

Operations Management

Operational planning has immense benefits to organizations that understand how to use it as a tool for effective management. Business operations in the hospitality industry are supported by various kinds of processes, some of which are unknown to customers (Cheong et al., 2017; Gao et al., 2016). Visible aspects of planning are those that can be seen by the naked eye, such as the workflow structure of an enterprise and the physical arrangement of seats at a restaurant (Abd Razak, Mills, and Roberts, 2020). Unseen aspects of operational planning may be supporting business processes that aid in service delivery but are not visible to customers in their service environment. Both aspects of operational management are critical to the provision of quality services.

Making changes to these operational plans requires managers to strike a delicate balance between changing the unseen and visible aspects of an operational process. The process is delicate because of its ability to affect other aspects of a business’s operations. At the same time, it could have implications on service quality and customer satisfaction standards, which are important metrics of performance (Benckendorff, Xiang and Sheldon, 2019; Cheong et al., 2017; Gao et al., 2016). The objective of this study is to use theory to explain how operations management processes in the hospitality industry can be used to improve efficiency (Hsiao et al., 2020).

The focus of the discussion is on the use of theory to create new opportunities for service improvements in a three-star hotel located in Shanghai, China. The case area of focus will be on the integration of self-check-in tools to minimize human contact between guests and hospital staff, according to COVID-19 regulations. The priority of the change process will be to create convenience for the customers because they would be able to check in seamlessly by showing their key cards.

Given that the hospitality industry is mainly a service-oriented enterprise, a lot of attention has to be paid to its operations management processes. In the context of this study, the generic performance objectives will be to serve customers within a short time. At its core, this paper evaluates the extent to which business process redesigning could yield significant savings for a three-star hotel in San Francisco. The focus of the analysis will be on understanding how theory can help. A process is a series of steps that have to be taken before a final product or service is developed.

The Case Study

There is limited capacity for accommodating increased customer traffic at the Shanghai hotel because the process has to be done physically and may involve the development of long queues of people waiting to be served. This is a source of customer dissatisfaction because it can cause inconveniences to guests, thereby forcing them to change locations if need be (Lee, Jeon, and Lee, 2019). Additionally, the hotel has one desk where all guests have to check in, thereby slowing the admission process. Similarly, sometimes there is no one available to attend to customers at the front office desk, thereby forcing customers to wait for long periods to be served. An upsurge of guest traffic, especially during holidays, has further piled on the pressure for authorities to manage their capacities well because only one staff listens to complaints. At the same time, the hotel does not have plans to manage an increase in demand for front-desk services, thereby exacerbating the situation.

Managing the expectations of customers is a key requirement for front office desk staff because they are the first point of contact between a business and a customer. Therefore, it is prudent to have qualified staff at this center of operational management to coordinate all functions of service delivery. Research studies have pointed out the difficulty of maintaining the expectations of guests in a stressful environment because when poorly attended, they could develop anxiety and impatience (Cheong et al., 2017; Gao et al., 2016). In extreme cases, guests may choose to cancel their reservations and get their money back. Deviations in the quality of services offered at the front desk may be responsible for compounding the problems of delayed check-ins.

Based on the above statement, the process that will be discussed in this study is the self-check-in phase for customers due to challenges brought by the COVID-19 pandemic (Salem, Elkhwesky, and Ramkissoon, 2021). Particularly, complying with social distancing requirements is a challenge for most hotel patrons at the three-star Shanghai hotel because the staff has to grapple with the challenge of handling unpredictable numbers of customers, which may expose them to the disease. Therefore, there is a need to redesign the operational check-in processes of the restraint to make them better aligned with current circumstances.

Technology Changes

Making changes to the operational processes of operations management could help to improve the processes in which customers check in the business. Particularly providing contactless customer- check-in operations would make the admission process seamless for a hotel because it would eliminate the need for customers to stand at the hotel lobby and wait in line to be served (Setty et al., 2018). The automated system will contain information relating to the customer’s data. For example, providing digital room keys would help hotels to comply with new rules on social distancing and limiting human contact (Xu, 2019). The contactless room delivery option was instrumental in improving the operational challenges of several businesses with similar qualities.

The use of technology to solve operational problems comes from a rich history of research studies, which have highlighted its role in promoting business practices and operations (Keane and Su, 2019). Researchers who have mentioned the growing importance of technology in improving business operations have supported this view (Ye, Newing, and Clarke, 2020; Lemon and Verhoef, 2016). In the context of this study, it has been applied to address the bottlenecks associated with processing guests to be checked in, especially when customers have to comply with social distancing requirements.

Most business operations were caught off-guard during the implementation of the pandemic rules and the hotel check-in process, which is the lifeline of the business due to its link with customer satisfaction and revenue, was similarly affected (Benckendorff, Xiang, and Sheldon, 2019). The use of a mobile application is also effective in eliminating the bottlenecks that exist in the implementation of digital business processes because they eliminate the need for physically checking in on customers.

The Extent of Effects on the Business

The effects of adopting technological measures for managing the operational challenges of the Shanghai hotel can be felt through its implications on the guest’s travel experiences, including their safety, efficiency, and ability to accommodate innovation.

Safety

Safety is one of the most important attributes of a customer’s service quality experience at a hotel or tourism facility. This is because guests need to feel safe in the hotel environment and that the services offered are at par with their safety expectations (Marquez and Gore, 2017; Li and Burns, 2017). In the context of the current study, technology is highlighted as one of the main solutions for addressing the operational challenges of the three-star hotel. The role that it plays in improving the safety of guests is an added advantage to the adoption of the self-check-in proposal. After all, it is difficult for someone to breach the system when it is protected by biometric data security (Strauch, 2017). These issues trace their origin to the theory of planned behavior, which predicts people’s actions based on their attitudes and norms.

The theory of planned behavior provides the background of acceptance for the high level of safety associated with the adoption of the self-check-in tool at the Shanghai hotel (Chung and Fong, 2015). By comparing it to other older tools, none comes close to the level of security or performance that technology offers in managing hotel operations. From a safety perspective, the use of biometric data to access or check-in rooms is a powerful tool for eliminating imposters or any other people who are not authorized to be at the hotel (Javed et al., 2021). Therefore, its safety security features are useful additions to the overall plan.

Increased Efficiency

The adoption of automated techniques in business process engineering is associated with increased levels of cost savings due to the inexpensive nature of technology and its associated benefits (Hossain, Zhou, and Rahman, 2018). Increasing the efficiency of operations is a primary goal of the Shanghai hotel because it is experiencing the pressure of coping with an uncertain business environment brought by the COVID-19 as well as a disorganized check-in system that is often overwhelmed whenever there is a surge in customer traffic.

The adoption of automated techniques to improve customer check-in processes is likely to increase operational efficiency at the hotel. This outcome will be realized because of the elimination of human-based processing methods in the entire value chain of the hotel’s check-in services. This area of operational management has been highlighted as one of the bottlenecks to service delivery, especially during peak seasons (Kirikkaleli, Yaylali, and Safakli, 2020) when there is high traffic of people.

The extent that which technology adoption could address this problem is supported by the operations management theory, which defines practices that organizations may follow to improve their efficiency (Kirikkaleli, Yaylali, and Safakli, 2020). This attribute of planning is focused on controlling various aspects of a business’s performance to minimize inefficiencies and wastages. This theory also stems from the mantra that businesses should use the least amount of resources to provide optimum services and quality products to their customers (Chung and Fong, 2015). The use of digital check-in technology helps to realize this objective because it redefines the way resources are used in the hotel.

The six-sigma method helps to highlight some of the opportunities for increasing the efficacy of the hotel’s processes in the current case study. In other words, it acts as a tool for managers to increase their business operations and capabilities (Pakdil, 2020). This operational planning model values practices that promote the prevention of defects as opposed to their detection (Tennant, 2017). Therefore, when applied in the context of the current case study, the replacement of human-based check-in processes for an automated model would help management to better prevent wastage by relying on these new systems as opposed to the old and inefficient models.

Ability to Develop New Innovative Approaches

Innovation is a critical part of operations management because it helps managers to look for new or creative ways to solve perennial problems. Additionally, it allows companies to merge their business processes to create improved and better-coordinated strategies that would help them to achieve their objectives. The use of traditional service processing techniques minimizes the potential of realizing the aforementioned advantages because human understanding and reasoning limit them. However, the introduction of new technology creates a paradigm shift that allows more ideas to be accommodated and included in the overall operations management plan.

Based on the revolutionary changes that automation can bring to a company’s internal systems, eliminating the human-manned hotel check-in desk for the Shanghai hotel sounded like an absurd idea in the distant past but it is a reality today. Indeed, today, the possibility of it happening is being discussed in several works of literature (Dixit, 2017; Koc, 2017) because whole systems and processes can be replaced for more efficient and reliable systems.

The main push driving this change is the opportunity to reduce the cost that exists because of advancements in technology. The adoption of new self-check-in booths has the potential to develop new and innovative approaches to managing the hotel’s operations (D’Alvia, 2021). For example, the installation of automated systems in the hotel’s check-in processes could create new opportunities for businesses to integrate their existing infrastructures with mobile payment systems or local area connectivity to allow customers to enjoy seamless services such as Wi-Fi.

Overall, based on the above proposals, the potential to develop new and innovative techniques is automatically increased because technology offers new platforms for integrating other aspects of operations management in the business’s internal operations. Researchers who have demonstrated how technology has helped them integrate their business operations across various product categories support this view (McLean and Barhorst, 2021). They also suggest that the continued reliance on technology to bridge the gap between businesses and customers will make it even more powerful in the future.

Summary

This paper has highlighted ways of applying theoretical models, principles, and concepts in the management of the check-in services for a three-star hotel in Shanghai, China. They show that changes to the operational plans of the Shanghai hotel can be implemented internally, and they may have a positive impact on customers’ sense of security, the firm’s efficiency, and its innovation. To explain these effects, the six-sigma model and the theory of planned behavior were advanced as important theories and models that would help explain consumer habits and their relationship with the proposed changes.

The operations management theory also played a key role in safeguarding the integrity and soundness of the hotel’s internal operations. Overall, this study shows that the extent to which operational processes would affect the performance of a business is by influencing the consumer’s sense of trust, invoking feelings of efficiency through the adoption of automated processes, and integrating the same processes with other aspects of digital operations, such as mobile payments, to create a larger ecosystem of digital support. Therefore, the impact of automating the check-in processes will have an impact on the operational processes of the hotel by expanding its outreach beyond what has been discussed in this paper.

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