Pandemic Recovery Operations for Restaurants and Hotels

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The hospitality and restaurant industry challenges that arose during the COVID-19 pandemic haven’t gone away. They’ve evolved, which makes being proactive and agile with operational activities even more important.

The previous adaptation model for the industry started with crisis management and morphed first into survival, then into concept transformation. Now, concept transformation must further adapt to resource management and realignment.

This discussion considers lessons learned during the pandemic and potential future outcomes to understand which tactics might be applied. Restructuring your operational actions is key to remaining competitive.

Operational Action Elements

Restaurants and hotels are still adapting to changes that 2020 and 2021 wrought on the industries. The coming years will have their own challenges.

Addressing future concerns starts with data and analysis to help understand and prepare for asset deployment, employee retention, supply chain issues, process restructuring, technology implementation, and ultimately, the focus of your team.

As a starting point, four key focus areas that could be used to refocus operational actions include:

  • Value your employees
  • Rethink supply chains
  • Utilize technology for better efficiency
  • Reduce energy consumption

Value Your Employees

In the restaurant and hospitality industries, the success of your enterprise always begins with people.

Considering daily operations is key, especially related to people. Many operational strategies were reconstituted quickly and continue to adapt to focus on the big people-related aspects of the business.

When the pandemic first accelerated, restaurants, hotels, and tourist attractions shut down and furloughed many employees. Many owners and operators worked to support employees by leveraging programs such as the Paycheck Protection Program (PPP), Economic Injury Disaster Loan (EIDL), Restaurant Revitalization Fund (RRF), and employee retention credits (ERC, sometimes referred to as the ERC credit), while trying to maintain operations and financial viability for their businesses.

Employees received unemployment benefits enhanced by federal, state, and local governments to support their families during fluctuating shutdowns. These programs ran their legislated course and largely concluded in 2021.

Many former employees used this period to further their educations, leverage skill sets, and test their worth in the marketplace for similar or different vocations. As a result, many employee groups moved en masse as part of The Great Resignation, creating staffing challenges not seen by employers in decades.

In the hotel industry, the ability to hire cleaning staff, night management, and others, have directly influenced how many hotel rooms could be reserved and occupied.

Restaurants, in many cases, have reduced operating hours and shifts, as they’ve struggled to hire and train enough staff to support operations.

Primary Employee Value Tactics

The drive to locate and attract capable people began in 2021 and continues to be a major focus for many businesses well into 2022.

Wage rates have escalated and continue to evolve in competition for people in the marketplace. Many offer health care, educational benefits, or more flexible schedules hoping to attract employees who are in school or have childcare needs.

Tactics to Attract and Value Staff

  • Offer competitive pay and benefits
  • Maintain flexible hours
  • Provide instant pay or pay card options
  • Enhance funding and implementation of training
  • Follow up and reinforce prior training
  • Encourage employee feedback
  • Create an enjoyable and safe working environment
  • Enhance one-on-one supportive coaching and advancement policies
  • Closely monitor management personnel, policies, and practices

Keeping employees in the loop is of critical importance. To do so:

  • Share your vision—what, how, why, and when
  • Tie operational actions to the business’s tactics, budgets, and compensation
  • Update operational actions and vision biannually
  • Celebrate successes

Ongoing Challenges from the Labor Shortage

Labor shortages are one of the premier challenges that hospitality and restaurant consultants anticipate, at minimum, for the balance of 2022 and 2023. Continued challenges to management focus, service offerings, and labor costs can be expected, even when employing the labor actions mentioned above.

Rethink Your Supply Chain

Like many other sectors, restaurants and hospitality aren’t spared from myriad issues affecting the overall supply chain. At present, these issues bring significantly inflated costs for food, paper, and supplies, along with reduced profitability.

Restaurant menus are being pared down to reflect key items that are available and to help improve gross margins. Menu prices have also increased considerably in some places to offset the rising cost of goods sold and labor.

Sourcing Strategies to Consider

  • Reduce number of deliveries per week
  • Reengineer product recipes and ingredients
  • Increase product order quantities to lower per-unit costs
  • Negotiate with suppliers on product quantities and price hedging
  • Leverage supply chain consultants with measurable cost incentives
  • Utilize cooperative purchasing practices with other buyers

Utilize Technology to Improve Efficiency

Implementing new processes and systems can take time for efforts to pay off. In the meantime, you have daily business to conduct.

Technology investments, such as automated ordering solutions and ideal food cost systems for example, are gaining appeal as countermeasures to labor and supply shortages, as well as to offset price increases to customers. Some of these have been around conceptually for decades and have been enhanced through lessons learned and improved technology platforms.

Discover and implement new technology solutions with the following process.

How to Discover and Implement New Technology

Stepts to discover and implement new technology; identify, conduct, continually iterate, establish, adjust to operational and establish resources.

It’s important to have practical expectations on time frames and costs for rolling out technology on a large scale.

Technology to Help Overcome Labor Shortages

Long-term technology investments could help overcome labor shortages while also being challenging to deploy, debug, and incorporate into day-to-day practices.

Examples of technology to help overcome labor shortages:

  • Automated consumer-driven order-entry kiosks
  • Labor management systems, especially for larger multi-unit concepts

A labor management system should be able to conduct and provide opportunities to:

  • Create engineered activity-based labor standards
  • Rethink staffing schedules throughout each week
  • Reduce overstaffing and proactively identify staffing voids by position
  • Improve customer service
  • Model and deploy for continual improvement
  • Provide best-in-practice feedback to leverage outcomes

Reduce Energy Consumption

Energy consumption.

Reducing a restaurant or hotel’s total energy consumption can create room in the budget to increase wages, invest in new technologies, and provide a way to minimize rising menu prices, all while meeting organizational green initiatives.

Following are a few ways you can target your energy usage:

  • Invest in energy management systems, including hardware, software, and system selection guidance
  • Gain support and advice from local energy companies and energy management solutions firms
  • Follow up on best practices location by location

Additional Considerations for Restaurants

There are additional industry-specific considerations to explore beyond these four initial areas of operational focus.

Ongoing and future considerations for restaurants include:

  • Brand positioning
  • Labor-related initiatives
  • Improvement investments
  • Concept repositioning

Brand Positioning

Brand repositioning is a key consideration for restaurants restructuring their strategy. These can reflect shifting customer needs, targeted markets, location choice, and supplier limitations.

Your brand positioning can and should reflect the new customer considerations. This could include trends in customer ordering approaches, vaccination status in your target markets, continued hesitations surrounding the pandemic, income variability, and much more.

Labor-Related Initiatives

Explore the following people-first initiatives for your operational actions:

  • Enhanced and customized training
  • Incentive systems
  • Message management for prospective employees

Improvement Investments

If you have room for ongoing improvements in your operational actions, either financially or through personnel initiatives, consider the following upgrades:

  • Operational systems, processes, and culture
  • Labor-management systems
  • Ideal cost of sales
  • Utility management

Concept Repositioning

Throughout the beginning of 2022, the restaurant industry tried to meet the growing consumer popularity of third-party delivery platforms among customers seeking convenience for a price, all happening amid other lifestyle changes that stemmed from the pandemic, such as working from home.

This evolution has prompted many businesses to reevaluate how they reposition their business operations.

Key focus areas to consider when repositioning the concept of your business include:

  • Delivery versus eat-in
  • Full versus limited service
  • Web versus in-person ordering
  • Menu offerings
  • Brand identity and marketing

Notes on Delivery

With the ability for dine-in experiences curtailed at various stages of the pandemic, many restaurant operators—and grocers, for that matter—jumped on the opportunity to dial in the efficiency of their off-premise practices, such as carryout, drive-through, and delivery.

Delivery, while once only applicable to certain restaurant sectors, such as pizza and Asian cuisine, has achieved traction in ways not thought possible before. According to some projections, the US ecosystem for restaurant delivery solutions has roughly doubled in size in the last 18 to 24 months—a level of growth that was not previously expected for at least another five years.

Additional Considerations for Hotels and Lodging

The reduced ability to operate at full capacity because of constricted cleaning staff and increased expectations for level of cleanliness has produced problems across the board for a hotel’s full-service offerings. In turn, this significantly reduces the financial viability of certain properties and the property’s ability to meet guest expectations or even maintain a standard customer experience.

As with restaurants, ongoing and future operational considerations for hotels and lodging include the following:

To counter the potential spread of COVID-19, federal guidelines and state and local ordinances were enacted to modify day-to-day operations of many businesses. This affected long-term operations and much more.

Some hotels and lodging businesses are investigating brand repositioning options to adapt to new customer expectations, whether they’re traveling for business or leisure.

Brand positioning considerations for the hotel and lodging industry include:

  • Change the brand image to better suit new customer expectations
  • Adjust marketing and advertising to communicate
  • Restructure current service offerings and train employees with new ways to talk with customers
  • Reevaluate site selection criteria to reach out to new targeted customers in the longer term

The hospitality industry faces unique labor shortage challenges, which can affect the operational capacity of the entire business.

Labor-related strategies to incorporate in your operational actions include:

  • Find creative, nontraditional employee sources
  • Explore self-check-in technology for the front desk
  • Create enhanced wage and benefit plans
  • Offer limited daily housekeeping services upon customer check-in
  • Weigh the viability of maintaining or limiting restaurant facilities

If you have cash and personnel for improvements in your operational actions, you might:

  • Invest in labor-related technologies
  • Make operational improvements during reduced operations
  • Improve the overall quality and image of facilities

During the first two years of the pandemic, the restaurant and hospitality industries, which traditionally relied on in-person interactions, adapted and revamped employee health management policies. With a renewed focus on properly disinfecting work surfaces, equipment, rooms and customer dining areas, as well as social distancing protocols, many businesses were forced to modify service practices and work spaces.

Many of these protocols seem set to continue for the foreseeable future. To adapt to new customer expectations, consider the following options:

  • Reposition location of properties to adjust to changing trade areas
  • Rethink food service as an expected service offering
  • Adjust breakfast to pre-packaged carry-away offerings

We’re Here to Help

Whatever challenges come to pass, if a restaurant or hotel is outfitted with an operational action plan and a good advisor on-hand, they’ll be more likely to weather the storm and prosper.

For questions about how to navigate the evolving business landscape, contact your Moss Adams professional. You can also learn more about increasing cash flow , how to sell your restaurant or hospitality business, or explore more insights through our Restaurant and Hospitality practices.

Additional Resources

For regulatory updates, strategies to help cope with subsequent risk, and possible steps to bolster your workforce and organization, please see the following resources:

  • COVID-19 Implications resource page
  • COVID-19 Implications: A Complete Content Map

Assurance, tax, and consulting offered through Moss Adams LLP. ISO/IEC 27001 services offered through Cadence Assurance LLC, a Moss Adams company. Wealth management offered through Moss Adams Wealth Advisors LLC. Services from India provided by Moss Adams (India) LLP.

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Linda Pashaj

By Linda Pashaj

Hotel operations are like a theater production. An immense amount of preparation is required, and when guests arrive and the curtain rises, it’s show time. 

When everything goes well, the guest experience is a beautifully choreographed production that generates rave online reviews and sold-out performances. If things go wrong, it can harm guest satisfaction, revenue, and reputation. 

How can hotels stage a blockbuster production for every guest? Here we look at all the components that go into smooth and efficient operations for independent properties today, from staffing to communication and automation.

What are hotel operations?

Hotel operations refers to the day-to-day running of a hotel . It encompasses all the activities and tasks employees perform to prepare for the arrival of guests and take care of their needs during their stay and right through to departure. 

Key operational areas in the hotel business

While virtually every department in a hotel supports operations in some way, core operational functions are provided by three main departments, each of which has both back-of-house and front-of-house team members.

  • Front office 
  • Housekeeping & maintenance 
  • Food & beverage 

Additional departments include:

  • Sales & marketing 
  • Revenue management 
  • Meetings & events
  • Human resources 
  • Guest services 

In larger, full-service hotels, these departments are run by entire teams, and strong leadership and communication are especially important. In small hospitality businesses, there might only be one or two employees per shift, and multitasking and organizational skills are fundamental. 

hotel front office SOP

5 ingredients of successful hotel operations

Together, different departments must work in sync to provide a seamless guest experience from arrival to departure, ensuring that guest requests and concerns are taken care of quickly and efficiently. 

This requires focusing on five key areas: 

  • Employee skills. Staff must have the skills and knowledge required to perform daily operations and meet the expectations of guests.
  • Employee attitude. Staff must have a can-do attitude, hospitable nature, and problem-solving skills.
  • Communication. Employees must work together and communicate effectively with guests and across departments. 
  • Technology. Hotels require innovative software tools that improve efficiency by automating tasks and workflows, speeding up transactions, and facilitating communications.
  • Support. Hotel management teams must plan carefully, ensuring team members have the leadership, tools, training, guidelines , and support needed to fulfill their duties. 

3 trends in hotel operations management

One of the biggest challenges facing the hospitality industry today is finding and retaining employees. In a June 2023 survey from the American Hotel & Lodging Association, 82% of respondents indicated they were experiencing a staffing shortage, 26% severely so. 

To offset labor shortages, hotel general managers and owners are rethinking their approach to operations. This has given added impetus to three trends that are expected to gain further momentum in 2024.

1. The rise of hotel automation

To increase efficiency and productivity, independent hotels are investing in software that automates tasks and transactions typically performed manually by employees across various departments. Examples include front desk software , guest experience software, and automated pricing and distribution tools.

2. More self-service technology

During the pandemic, self-service gained mass adoption as travelers sought ways to minimize contact with hotel staff. Today, with the help of automation technology, more hotel guests are helping themselves rather than waiting in line or on hold. Examples include hotel bookings, remote check-in and checkout, contactless payments, and digital door locks.

3. Changing hotel job descriptions

Automation and self-service are transforming traditional hotel job descriptions. With technology handling simple, repetitive tasks and transactions, hotels can run on a leaner staffing model and combine job responsibilities, allowing employees to dedicate more time to guest service, data analytics, hotel marketing, and strategic planning.

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Benefits of hotel automation

By adapting to these trends, hotel properties can increase not only efficiency and productivity but revenue, profitability, and occupancy while improving customer satisfaction.

operational plan hospitality industry

“Automation allows our property to improve processes, save money and time, reduce mistakes, and boost revenue,” says Alberto Lozano, Director of Reception, Reservations, and E-commerce at Hotel Las Cortes de Cádiz in Cloudbeds’ book, More Reservations, Happier Guests . “Now that our staff doesn’t have to spend so much time on computer-related tasks, they have turned into guest experience leaders. Not only have we saved money, we’ve also been able to reallocate a portion of our budget for human resources and processes to marketing.”

He adds, “It isn’t just about technology. Automation is vital to the future of the hotel business to reach maximum efficiency at all levels – finance, operations, and hospitality.”

The role of hotel management software

The backbone of successful hotel operations is hotel management software . Today, hoteliers have dozens of software applications to choose from to automate and augment operational tasks. However, if applications aren’t integrated and don’t communicate with one another, hotel technology can be more of a hindrance than a help.

To overcome these challenges, top hotels are moving to cloud-based hospitality management platforms that connect and unify all the core software applications of hotel management. This includes the PMS, reservation system, revenue management system (RMS), payment systems, and more. By consolidating guest profiles under one unified system and automating an increasing number of tasks, hotels can ensure greater efficiency in workflows, data capture, and communications across departments.

6 strategies for leveraging technology to improve hotel operations

Successful integration of automation technology in hotel operations requires careful thought and planning. Here are six areas for hotel owners and operators to focus on: 

  • Identify touch points throughout the traveler’s journey where communications among employees and guests can be handled more efficiently with technology. 
  • Decide which operational tasks and transactions can be automated and which should continue to be handled by employees. 
  • Give guests more control over their stay by offering self-service solutions that are convenient, reliable, and connected to the property management system.
  • Divest from outdated, fragmented PMS systems that slow down operations. Invest in a cloud-based, integrated hospitality management platform to provide efficient, seamless guest experiences. 
  • Provide employees with the training and support required to utilize hotel technology fully.
  • Monitor performance over time to evaluate results and find more ways to fine-tune operations and deliver higher guest satisfaction .

hotel software features

Improve hotel operations with the Cloudbeds Platform

Critical to success in hotel operations is finding a technology partner that provides the tools, training, and support you need. Cloudbeds’ fully integrated, cloud-based hospitality platform is designed specifically for independent properties. 

Here are just a few of the ways Cloudbeds can improve hotel operations:

  • Intuitive hotel PMS. Cloudbeds’ PMS optimizes everyday procedures with tools that streamline and automate manual tasks.
  • Simplified payments. Cloudbeds Payments integrates seamlessly with the Cloudbeds Platform so that all payment information resides within one system and is backed by one support team with deep hospitality knowledge and expertise to help prevent fraud and reduce chargebacks. 
  • One-click reporting. With real-time reporting and analytics built directly into the platform, hotels can utilize the power of data to improve workflows and make data-driven decisions.
  • Integrations. Properties can shop the Cloudbeds Marketplace for specialized apps like online check-in, keyless hotel room entry, and a POS that connects directly with the platform to build an ideal tech stack. 
  • World-class support. A trusted partner, Cloudbeds offers a library of resources through Cloudbeds University and a team of hotel industry experts available 24/7/365 to help hotels succeed.

The stage is set

Hotel operations are changing. By putting the right staffing, communications, and technology in place, hotels will have all the elements needed to stage a hit production that keeps guests coming back time and again. 

About Linda Pashaj

Linda Pashaj is the Content Marketing Specialist at Cloudbeds, the hospitality management software for properties of all sizes. Her previous experience includes running the operations of a small short-term rental agency in Barcelona, as well as content management for a vacation rental software. She is passionate about travel tech, digital marketing and “all things cats”.

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Ultimate hotel operations management guide [+10 free checklists].

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Coordinating a hotel is an incredibly involved process. It is like a clock being a delicate mechanism that is composed of many different pieces that all fit together and run in unison.

Tasks in the hotel industry are a minute strategy that relies on numerous tasks being completed without fail so that things happen when they are meant to. With a proactive h otel operations management strategy , no guest preferences stray from the high level of service set by hotel management.

You could be the best in the market at converting your OTA reservations into direct guests and achieving a high click share on hotel meta-search engines, but if your rooms are poorly serviced, you are going to get negative online reviews affecting your brand reputation. Optimizing operations management in the hotel industry yields revenue, occupancy levels, and guest satisfaction, three ways in which your hotel will outperform others in increasingly competitive markets.

Hotel operations make up everything you and your team have to do to keep your hotel running. It’s no small feat, and it takes proper planning and coordination to make sure you have the processes in place to keep things not just running, but operating seamlessly. 

Every hotel is different, and operations management isn’t just one-size-fits-all.

To keep everything at your property streamlined , it’s critical to plan for operations across your hotel based on the type of hotel you run and how your departments and teams are organized. 

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That’s why we’ve put together this hotel operations management guide: to help you maintain efficiency and anticipate operational needs for your hotel, no matter what kind of hotel you run. To continue your learning, check out our comprehensive Hotel Maintenance Management Guide

What is Hotel Operations Management?

Hotel operations encompass the core activities necessary to keep a hotel functional. This can include everything from housekeeping , laundry, room service, front desk tasks, security and more.

Hotel operations management can span a wide variety of tasks and types such as: organizational structure, hiring and training staff, task management, facilities upkeep, guest experience, technology systems, and more. 

Anticipating expenses, choosing the appropriate software systems, finding the right staff and managers, scheduling operations and strategies developing company success, and keeping operations flowing smoothly overall fall under the hotel operation job description.

Operations that are efficient and effective may bring about a hotel's increased efficacy and efficiency. Successful hotels have designed a way to perform daily chores quickly, efficiently, and in a very high volume.

Why is Operation Management in the Hotel Industry Important?

The definite importance for the success of any hotel is to know and deliver the expectations of the guests in the hotel. Efficient operations assist the hotel in providing a pleasant guest experience starting from hotel bookings to hotel check-out. Satisfied visitors are more likely to return to the hotel and recommend it to others.

Furthermore, proper budgeting, financial planning, and resource allocation are integral to the financial viability of any hotel. Knowing how to effectively run a hotel allows the company to effectively control expenses, maximize earnings streams, and preserve profitability.

Moving along, Efficient operations can give a hotel an edge while competing in the hospitality sector, as many hotels have struggled to stand out themselves beyond the hotel's established brand and star rating. With efficient operations, a hotel can offer better services and faster reaction times than its competitors. It may also make it the most comfortable and appealing hotel.

Managers who know how to manage hotel staff let the employees and staff feel good about the property and not overwork from being short-staffed. A proper staffing level, training programs, and a smooth process are also steps to assisting in continuing a motivated and productive employee base.

The complex regulatory environment within which hotels operate necessitates ongoing attention to and management of compliance with laws and regulations and the implementation of risk management strategies to avoid issues in terms of safety, security, and legal matters.

Operations Management Across Hotel Types 

Operations management needs also vary across hotel types. A large hotel belonging to a brand chain typically has different operational needs than a small independent or boutique hotel. This doesn’t mean less operations management tasks though, it just means that the operational needs at each property differ. Use a hotel business plan template for guidance on what kind of hotel would be feasible to open and generate the most profit.

Comparing Hotel Operations by Property Type

Chain Hotel vs Independent Hotel

Many chain hotels feature large properties with hundreds of rooms or even property portfolios with multiple hotels in one area, each with hundreds of rooms to keep track of.

While chain hotels typically do not offer specialty services such as spa treatments, valet parking, or fine dining, they do face challenges relating to the sheer magnitude of the operation . Because of the size of chain hotels, they often require a large staff to operate smoothly, and the larger the staff, the increased need for repeatable brand standards. 

The operational needs of a chain property include: 

  • managing maintenance across all those rooms, facilities, and common spaces 
  • training and management of staff including housekeepers, technicians, team leads desk attendants, and more
  • task management and work order tracking for guest requests, routine maintenance, risk prevention , and more 
  • asset tracking for guest room and facility assets 
  • process oversight and training
  • setting up and supervising standard operating procedures
  • documenting, logging, and tracking brand compliance needs 

And that’s really just a few of the things on a large hotel’s plate when it comes to operations management. When it comes to independent properties, operations management needs might be less of a pull, but these hotels still have similar management needs. Oftentimes these needs are simply scaled down due to the difference in property size.

Independent Hotels Have More Freedom, but Less Resources, to Craft a Guest Experience

An independent property likely only has one location and generally has fewer rooms than a hotel that’s part of a large chain or known brand.

Many independent properties feature a smaller team running the property too, with the manager of the hotel often taking on the duties of several roles to keep operational costs down. Because of this, independent hotels tend to prioritize task and asset tracking highly when it comes to operations management.

Boutique Hotel Operations Management

A small hotel really refers only to the size of the property: generally less than 200 rooms. Small hotels are typically independently owned and feature a much smaller staff than its larger counterparts. Small Hotel Operations Management can span roadside motels all the way to luxury boutiques with the difference coming in the property cost, amenities and service.

Boutique Hotel Reputation Resides in a Well Crafted Unique Selling Proposition (USP)

Boutique hotels and small hotels can be similar in size and general management needs at surface level, but what makes a boutique hotel different is their high value unique selling proposition, such as an attractive location or comprehensive service offering.

This likely means that boutique hotel operations management needs to span additional areas of work, including food and beverage operations, spa services or specialized guest facilities or attractions. It is in mastering this unique selling proposition that a boutique hotel thrives and builds a lasting brand image.

For example, a boutique hotel might offer a park or garden on site for guests to enjoy during their stay.

This area would likely require regular landscaping, maintenance to any equipment or facilities within the garden such as tennis courts, public guest restrooms, benches, fountains, etc.

The operations needs at a property like this might seem minimal at first because the property is smaller, but depending on amenities, management needs can greatly vary—that’s why resorts and destination hotels often still have high operations management needs too. 

Resorts Operations Management

Resort and destination properties often have many rooms or small rentals available in one location, campus, or resort destination.

Resort operations management is the oversight of activities that are directly related to the specialist provision of services and facilities to resort guests, such as hotel management, accounts, marketing management, food and beverage, production and maintenance, and the human resource department.

Beyond the operational needs of maintaining rooms or rentals, these hotel teams must keep up with dozens of facility assets such as: 

  • common-space entertainment items such as foosball tables, volleyball nets, tennis courts, etc. 
  • amenities such as pools and hot tubs, shared gym spaces, outdoor showers, fountains
  • public guest assets such as beach chairs, tents, umbrellas, etc. 
  • food and beverage facilities across the resort or destination campus 

Beach Resorts Require Consistent Inspections for Ocean Damage and Deterioration

In addition, these properties require additional maintenance simply because they’re near the ocean.

The natural effects from salty sea air and ocean water can cause damage to certain assets and often require a higher capital expenditure budget to keep up with deteriorating facilities. Good operations teams can identify potential issues and raise the work order ticket to the maintenance team, all without disrupting their current task. Team communication and work order software can make this easy for staff while creating a record of requests, costs and resolution times.

Hostel Operations Management

Hostels are a unique operating challenge due to the increased number of residents and common areas. Hostels typically have private rooms as well as bunk rooms with 4 to 16 beds per room.

The hostel market is expected to increase dramatically in 2023 due to rising consumer demand, technological developments, and the entry of new companies into the industry, demonstrating the vital function that optimized hostel operations management plays. As customer demand for hostel lodgings grows, simplified operations become increasingly important.

Effective operations assist in guaranteeing that check-ins are seamless, properties turn over rooms quickly, and resources are functioning to their full potential - all of which are critical in dealing with increasing footfall.

The facilities such as bathrooms and lounge areas are shared by all residents. Hostels often offer breakfast and night activities for residents because they rely on the income from food and beverage purchases to increase the revenue per guest. Hostels also offer residents transportation and excursion planning assistance to get the most out of the local area.

Hostel Operations run on Lean Budgets, Low Average Nights per Guest and After Booking Upsells

With the large amount of people coming and going, often only for one or two nights, hostels have little time to make a lasting impression. Proper housekeeping operations are paramount in this effort and can be the difference between a thriving brand and a low rated cheap stay. This is important as many hostels operate in small chains with locations in major tourist hubs across a country or geography. By providing an ideal guest experience, the hostel has the opportunity to provide transportation, excursions, food and future housing in one of their sister properties.

Operations Management Across Departments and Teams

Just as operations management needs change based on hotel type, these requirements also vary based on department and team need. Different departments across your property have different communication styles. Each team may also contain staff members from vastly different backgrounds with varying education levels and varying motivational drivers for success. It’s important to look at all of these things when examining the operational needs from department to department and across teams at your property. 

Hotel Operations Elements

💬 Communication Styles Differ Between Employees and Roles in a Hotel

Some teams may require more direct management styles and continued oversight, meaning these teams need an on-site manager or team lead to oversee tasks and goals in real time to keep everyone on track. However, other teams may be able to work more autonomously with the right SOPs and tools in place. Determining individual team and department managerial needs is the first step in understanding the broad operations management needs at your hotel beyond the general facility management needs of a property. 

Common Hotel Operations Management Challenges

Let's address a few common challenges in running a hotel, which we have identified from feedback and data given by hotel managers.

Hiring Staff 

Hiring and keeping employees is a major difficulty in the hospitality sector. Every hotel or restaurant needs a large number of employees to run its operations on all fronts, including administration, maintenance, cooking, housekeeping, and front desk.

Guest Experience 

Meeting rising customer demands is a constant challenge in creating the ideal guest experience. Today's visitors are more experienced and assertive; to provide the ideal stay, hotels must constantly fine-tune, improve, and revamp themselves in terms of customized experiences, flawless service standards, and cutting-edge facilities.

Revenue Management 

Hoteliers can find it challenging to optimize room rates, regulate inventory, and use pricing methods to maximize income streams from their lodging properties. The Director of Operations hotel must strike a balance between the owner's aim of increasing income and the necessity to remain competitive in the marketplace. They must also consider seasonality, local events, and rival actions while developing their sales plans.

Operational Efficiency

Hospitality operations are complex and dynamic, requiring many procedures to provide ease of service while maintaining service quality. Multiple streams of processes must be flawlessly connected; from housekeeping schedules and cleaning rotations to front desk procedures, a typical property's operations must be well coordinated and responsive.

Regulatory Compliance 

Regulatory adherence is a continuing challenge at the local, regional, and worldwide levels. Hoteliers must be informed of any changes in safety standards, health and safety regulations, employment requirements (e.g., minimum wage), and data privacy legislation.

Decentralized communication systems and lack of procedural oversight are a couple of general causes for managerial challenges like these.

A few common operational management challenges that come up at hotels often include things like miscommunication, lack of clear logs, data or reporting, unclear or unidentified standard operating procedures, and employee motivation or accountability issues. Decentralized communication systems and lack of procedural oversight are a couple of general causes for managerial challenges like these. 

👎🏽 Negative Reviews are Easier to Obtain and More Detrimental to Success than Ever Before

And unfortunately such issues can quickly lead to things that reflect poorly on your property, like inefficient quality control, inadequate risk prevention, failure to meet brand standards of compliance, and more. Letting a few small things slide is a slippery slope to negative reviews and public reputational damage that can seriously impact your property’s goals and your bottom line. That’s why it’s so crucial to identify operational management needs early. 

Core Elements of Hotel Operations Management

When you’re first understanding or re-examining the operations management needs of your hotel, it’s important to understand the team roles and responsibilities within each department across your property. Take a look at where your property is at right now with its operations management and note any areas for improvement so you can set clear goals for processes. You might even consider taking polls or conducting departmental interviews to get clearer insights into what’s working and what isn’t across your property. 

✂️ Segment Operations to Identify Root Processes Needed for Team, Department and Property Success

Break up the objectives and goals by department and show how each team contributes to the overall company mission. Continue breaking apart operations into different silos until you are left with the root processes that employees must do for the property to succeed. This is the first layer of standardization in which managers can implement SOPs, checklists and accountability protocols. From there, each managerial position will monitor team success, the directors will oversee department success, and ultimately the general manager guides the entire ship. Be disciplined and collect data to identify bottlenecks in the process. Refine and rework until you find the formula that works for your property and your team.

operational plan hospitality industry

📱 Use Technology to Gather Data Necessary to Make Smart Decisions

The fact that 93% of hoteliers have experienced a significant improvement in the efficiency of their technology demonstrates the relevance of the hospitality management system in today's hotel industry.

An ideal hotel operation management software will streamline procedures while also providing users with a variety of benefits such as greater guest satisfaction, more effective financial management, and a more profitable, competitive firm.

Once you’ve started to gain a deeper understanding of your current management needs and/or existing operations oversights, you’ll be able to establish expectations for improvement and set up processes and protocols to reach departmental and organization-wide goals.

From there, you can use tracking tools and logs to monitor progress and optimize over time. Utilizing a digital operations solution to align your team across departments and properties and increase visibility into organizational procedures, goals, and initiatives can help further solidify your management practices as well. 

Solutions like Xenia provide modern, customizable hotel operations management, instant digital communication tools, and comprehensive reporting and data tracking so you can get clear insights and set intentional goals for improvement. 

Importance of a Hotel General Manager

In the end the buck stops at the General Manager. Arguably the most difficult and important role in any property, a General Manager oversees everything from profit and loss to staff operations. Recruiting the right people , training and empowering the frontline staff is a tall task with multiple areas of necessary oversight.

The role of a hotel general manager might differ slightly between property types at different hotels, but the core responsibilities tend to remain the same—a hotel general manager guides the adherence of rules , compliance, and performance standards at the hotel and is responsible for overseeing all operations across a property. 

🎩 A Successful General Manager is a Respected Leader who "Wears Many Hats"

At most properties, the General Manager is responsible for all levels of property oversight including new openings and renovations, sales and marketing initiatives , profits and financial goals, facilitating guest experience, overseeing department managers, and more. A hotel’s general manager is at the cornerstone of both front of house and back of house operations management, keeping everyone on the same page no matter how things are segmented at the property. 

Hotel Front of House Operations

Front of house operations at a hotel essentially refer to the guest-facing operations at the property. This includes things such as front desk tasks , concierge services, food and beverage operations , and hotel security work . Keeping front of house operations running smoothly is of chief importance in maintaining a property’s guest reputation since these services likely make up the first impression guests will have of your hotel. 

Hotel Front of the House Operations

🖥️ Hotel Front Desk Operations

The front desk team is responsible not only for greeting guests and making sure they feel welcome, but also for: 

  • checking guests in and out of their rooms.
  • taking guest requests throughout their stay.
  • providing bell hop and valet services.
  • helping with bookings and cancellations.
  • providing local information and directions when necessary.
  • facilitating the reporting and tracking of lost and found items.

🛎️ Hotel Concierge Operations  

At some properties, especially larger or chain hotels, there might also be a concierge team as part of the front of house operations. In this case, the front desk team likely won’t be responsible for local recommendations, directions, or bell hop and valet services. Instead, the front desk team will direct guests to the concierge for these amenities. A good Hotel Concierge should be knowledgeable of the following:

  • Local restaurant recommendations
  • Local government laws and restrictions
  • Local attractions
  • How to schedule tours or excursions
  • Directions to local destinations
  • Guest package handling and delivery
  • Guest request handling

🍽️ Hotel Food and Beverage Operations

When it comes to food and beverage (F&B) operations at a hotel, management needs and responsibilities vary depending on the type of food and beverage services offered, but generally hotel F&B teams are responsible for:

  • maintaining and operating any restaurants on the property.
  • facilitating room service operations.
  • keeping the hotel bar clean and running smoothly.
  • providing guest breakfast services.
  • running any hotel café services or beverage cart options.

Food and beverage operations come with additional pull to maintenance and facility management as well—you’ll need to ensure your F&B team has specialized technicians to service and perform regular maintenance on kitchen equipment. You’ll also need to ensure the team has staff dedicated to appropriately cleaning these facilities. 

🚨 Hotel Security Operations

Your hotel’s reputation doesn’t solely rely on the first impression it leaves for guests—it also relies on how you keep your hotel safe and secure for guests and staff. Your hotel’s safety and security department is responsible for ensuring guest safety, taking care of noise complaints and addressing security concerns, following brand standards and local ordinances around security compliance, and more. 

Hotel Back of the House Operations

The back of house operations at a hotel are the ones hotel teams typically want to go unnoticed by guests. These operations include housekeeping, laundry services, maintenance tasks, information technology processes, financial operations, and more. This is where departments often start becoming more segmented and harder to keep track of if you don’t have the right operations management plans in place. 

Hotel Back of the House Departments

🛏️ Hotel Housekeeping Operations

Depending on the number of rooms and facilities at your property, hotel housekeeping is likely one of the largest operations within your hotel. Your housekeeping team is responsible for ensuring guestrooms, public facilities, and amenities are cleaned and inspected at your property. This includes reporting issues such as damaged linens and inspecting for signs of pests such as bed bugs . The housekeeping team not only conducts cleanings before and after guest stays, but performs turndown service during stays and manages guest requests such as delivering fresh towels, extra blankets, or additional toiletries. 

In a property with hundreds of rooms and multiple guest facilities, the housekeeping team generally has to be quite large to keep up. Tracking room cleanings, inspections, and more can become cumbersome for a fully staffed housekeeping department at a large property without the appropriate operational procedures in place. Digital task tracking tools, like Xenia, can automate the assignment, progress and completion of housekeeping tasks to ensure optimal staffing levels.

🧼 Hotel Laundry Operations

Hotel laundry operations , similar to housekeeping operations, make up a large part of hotel operations. 50% of the cost of internal laundry operations is related to labor. By streamlining labor processes, managers can save significantly while providing an improved guest experience. Laundry teams are charged with managing linens across the property, and this isn’t limited to guestroom linens. The hotel laundry team typically takes care of linens across facilities and F&B services too, meaning there’s a hefty amount of laundry that needs to be accounted for at your hotel every single day. 

This team has to ensure that linens are collected, cleaned and sanitized, dried and folded, categorized and returned to the appropriate location. They’ll also need to note the condition of linens to replace any worn textiles.

🧰 Hotel Engineering and Maintenance Operations

Hotel engineering and maintenance teams ensure that assets across your property are in proper safe and working order for guests and staff.

This hotel opearation management team also addresses work orders submitted by guests and takes care of groundskeeping and pool maintenance when necessary.

Proper HVAC system performance is essential for guest comfort and health. Hotel engineers are in charge of monitoring, maintaining, and repairing the HVAC system. This approach ensures that the temperature throughout the hotel is appropriately managed and that the air is regularly replenished.

Maintenance techs ensure that preventative maintenance procedures are adequately followed on a regular schedule so that property assets from guest rooms to workout facilities function appropriately. 

🌐 Hotel Information Technology Operations

Hotel information technology operations are often managed by an IT professional but can occasionally be rolled into your maintenance team’s responsibilities. IT teams supervise the functionality of property WiFi, CCTV , in-room tech systems, TV sets and more.

☎️ Hotel Sales and Marketing Operations

Your hotel sales and marketing team is responsible for drawing people into your property and meeting organization-wide sales goals.

They’re additionally responsible for brand reputation management : ensuring your property is adhering to the brand standards compliance in how it not only represents the brand in its facilities but also in its public language, marketing visuals, and actions. This team provides booking support, especially with large groups, business travel, or hotel event bookings.

💸 Hotel Finance Operations

The finance team makes sure you’re on track with profits and keeps leadership notified of losses. They’ll track the budget for asset expenses and facilities management too. Anything to do with accounting and number tracking is going to fall under the finance team’s responsibility. Since financial models are only as good as the inputs that drive them, gathering accurate operations data is of utmost importance. Using digital operations software allows financial managers to easily view the impact of daily functions on the bottom line.

😊 Hotel Human Resources Operations

Finally, your human resources team is responsible for operations such as payroll and general employee management.

Your human resources representative will usually assist with hiring and is often the team member responsible for formally issuing offer letters for new hires and managing communications about onboarding and initial education. This team will handle employee complaints and disputes as well. 

Moreover, In hotels, the HR team is responsible for organizing several training sessions which help enhance the skills of the staff. HR teams ensure that they carry out orientation for each and every new employee. They have periodic training sessions for all the employees and they also have many development programs which help in ensuring that the staff is skilled to keep up with the industry trends.

How to Hire the Right People for Your Hotel

When it comes to hotel operations management, one of the most important things is hiring the right people for your property.

Once you’ve identified the true span of your operational needs and started to put procedures in place for management, you’ve got to bring on the right team to oversee your property needs and effectively communicate between leadership and staff. 

🎓Identify Core Competencies and Ask Questions to Compare Candidates

  • To ensure that you, and the candidates, have a clear understanding of the expectations, clearly outline the Hotel operations job description.
  • Post your job offers on the appropriate employment portals and platforms online to gain access to more varied, skilled applicants.
  • Attending industry events, joining professional organizations, and networking are all great methods to meet people in the hotel sector. Furthermore, you might be able to potential candidate
  • Create an internship program to find and train suitable employees. This will allow you to assess their talents and general ability for potential full-time roles.
  • Conduct comprehensive interviews to evaluate their skill set.
  • It is crucial to consider how well someone fits into your hotel's work culture and how they interact with others; these factors will help you determine if they will fit in.
  • Highlight opportunities to give them room to grow within the hospitality sector.

Take the time to understand the ideal candidate for your property— identify any must-have traits you’d like to find in your new employee and take the time to formulate questions that will help you intentionally interview potential candidates to seek out those traits you’re looking for. Then interview with patience, knowing it can take some time to identify the best members for your team. From there, set clear expectations for growth and opportunity.

Excerpt from 99 Core Lodging Competency Checklist

Ensuring that you’ve established definitive ideals and expectations sets everyone up for success. But don’t stop the communication after the interview and the acceptance letter! Keep communication channels flowing between employees, especially between department managers and the general manager of the property. These are the most important working relationships to foster so that everyone stays aligned on hotel goals and expectations. 

From there, you and your team can start setting up clear SOPs for processes across your property, and you can even utilize a digital solution like Xenia to simplify your management operations from top to bottom. 

What is a Hotel Standard Operating Procedure (SOP)?

A hotel standard operating procedure , or hotel SOP, is a standardized way of completing regular operations that keeps your work processes consistent and maintains efficiency, accuracy, and safety across your hotel, property, or properties. Hotel SOPs ensure brand compliance and quality standards across facilities and locations to keep your leadership team, and your hotel guests, safe and happy. 

Hotel Standard Operating Procedure Examples

Hotel SOPs can include things like daily management procedures, housekeeping protocols, and preventative maintenance—or really anything that needs standard procedure tracking. For example, front office SOPs help to maintain consistency in check-in and check-out processes and ensure efficiency with hotel opening procedures, while facility SOPs might help your kitchen staff keep the facility safe and ensure a standard level of cleanliness for guest dining requirements. 

You can set up an SOP for any area at your property and for any process that needs standardization. It’s made even easier if your property implements an operations management software like Xenia that allows your leadership team and staff to access SOP checklists and process documents all in one place.

Streamline Hotel Operations, Maintenance and Quality Assurance with Xenia

Xenia unifies daily operations, maintenance management and quality assurance to help General Managers ensure teams and facilities are effective and efficient.

Xenia Hotel Operations Software

Our customers love Xenia's robust use cases including:

Daily Operations

✔️ checklists & sops.

Create checklists, SOPs, Inspections and Data Logs to power accountability, training and staff clarity on every task.

📆 Recurring Tasks

Create recurring schedules for daily opening and closings, performance review meetings, inspections, cleanings and more.

📲 Chats & Announcements

Centralize team communications with in task chats, one-on-one chats, team messages and company wide announcements

💪 Team Accountability

Defeat pencil whipping and disorganized responsibility assessments by standardizing operations with Xenia. Chat with teams on any device, track time, collect photos, and ensure high quality work.

📊 Team Performance Reporting

Use Xenia's analytics dashboards to view staff work reports. Filter by asset, location, category or due date and export the report in PDF or Excel

Maintenance Management

🛠️ work orders.

Create work orders with associated team, asset, location, priority, category and due date. View live progress reports on each work order, chat with teams, and review resulting template submission, images and notes to improve operations.

🧰 Preventive Maintenance

Create a preventive maintenance calendar to ensure asset uptime is not compromised. Attach images, templates, videos and notes to every task and assign to a team or individual for completion.

Generate and attach QR codes to equipment and facility locations to enable fast and accurate inspections and data logs.

📁 Equipment Work History

View work history for every asset and sub asset in Xenia. Review performance data and enable corrective actions to improve your operation.

Quality Assurance

👍 brand standards.

Put your brand standards in a clear and operational checklist to be attached to work assignments.

🔎 Smart Inspection Workflows

Xenia's operations template builder has built in conditional logic into each step. This allows you to trigger actions based on a form response such as creating a corrective action on a failed inspection step, sending a notification to management for out of range meter readings, and much more.

✨ Corrective Actions

Operationalize inspections with fast work order assignment arising from a failed inspection step. All corrective data is stored in the checklist submission for auditing and accountability.

📋 Analytics and Reports

View live dashboard summaries of tasks, employee performance, template submissions and more. Filter, organize and export compliance reports to PDF and Excel formats to simplify compliance management.

Why use Xenia in your hotel operation?

Xenia is empowering hundreds of teams around the world to elevate their hotel operations management. When implemented, Xenia offers benefits such as:

🦾 Reduce Manual Operations

With Xenia, you can schedule recurring tasks and work orders in minutes. Assigned employees will receive notifications and can complete work on their mobile device.

💯 Standardize Processes & Increase Accountability

Build custom checklists, SOPs, inspections, log books, surveys, meeting agendas and more with Xenia. Attach these to tasks and work orders to clarify work and collect crucial data such as photos, notes, time stamps and more.

🤩 Minimize Negative Reviews

Xenia's operations platform increases brand standards and speeds up issue resolution to ensure a positive guest experience. When things do go wrong, Xenia provides a central data suite to identify the root cause and execute intervention plans.

⚡ Speed Up Work Order Resolution Time

Enable any team member to report issues, damage or guest complaints directly on their mobile device. The necessary team will be notified and can resolve the issue immediately.

🏨 Minimize Equipment Downtime

With Xenia's preventive maintenance calendars and work order management, teams can centralize their asset maintenance and ensure every issue is prevented or corrected in short order. This saves teams thousands each year in avoidable repair fees.

🔐 Secure Data Storage

All data in Xenia is securely stored in the cloud for analysis and reporting. We do not delete historical data to ensure that you have a clear view of improvement over time.

operational plan hospitality industry

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Frequently Asked Questions

Got a question? Find our FAQs here. If your question hasn't been answered here, contact us .

What is Hotel Operations Management and why is it crucial in the hospitality industry?

Hotel Operations Management encompasses all activities essential to keep a hotel functioning smoothly, including housekeeping, laundry, room service, front desk tasks, and security.

It is crucial as it directly impacts guest experience, financial viability, and competitiveness in the hospitality sector.

Efficient operations management ensures the hotel meets guest expectations, controls expenses, maximizes revenue, and maintains a positive brand reputation. It is vital for providing high-quality services, quick response times, and ensuring staff are well-managed and motivated.

How does the operational management need vary between different types of hotels?

Operational management needs vary significantly across hotel types.

For instance, chain hotels often focus on managing a large number of rooms and staff, maintaining brand standards, and handling large-scale maintenance and housekeeping operations.

Independent and boutique hotels, while smaller, prioritize creating unique guest experiences and may have more specialized services like spas or fine dining.

Resorts require managing additional amenities like pools, recreational facilities, and possibly beach maintenance.

Hostels face challenges of managing high guest turnover and communal spaces. Each type requires tailored operational strategies to meet their specific needs.

What are the common challenges in hotel operations management and how can they be addressed?

Common challenges in hotel operations management include hiring and retaining skilled staff, enhancing guest experience, optimizing revenue management, maintaining operational efficiency, and ensuring regulatory compliance.

Addressing these challenges involves implementing effective staff training and retention programs, using guest feedback to improve services, employing dynamic pricing strategies, streamlining operations with technology and standard operating procedures, and staying updated on regulatory changes.

What role does a Hotel General Manager play and how do they contribute to successful hotel operations?

The Hotel General Manager is a pivotal figure in hotel operations, overseeing everything from financial goals and staff operations to guest experience and adherence to brand standards.

Their responsibilities include managing front and back of house operations, coordinating between departments, overseeing renovations and marketing initiatives, and ensuring profitability.

A successful General Manager wears many hats, balancing leadership, operational oversight, and strategic planning to ensure the hotel operates efficiently, meets guest expectations, and achieves its financial objectives.

Their leadership directly impacts staff morale, guest satisfaction, and the overall success of the hotel.

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  • Hospitality Industry

What is the Hospitality Industry? All your questions answered

What is the hospitality industry

November 23, 2023 •

20 min reading

What is the Hospitality Industry?

The hospitality industry is a large subsection within the service industry and is comprised of four main areas : Food & beverage, travel & tourism, lodging, and recreation. As examples, the F&B category includes restaurants, bars, and food trucks; travel & tourism covers different forms of transportation and travel agencies; lodging varies from hotel resorts to hostels; recreation refers to leisure activities such as sports, wellness, and entertainment. While all sectors are interconnected and reliant on each other, many of these hospitality sectors are quickly evolving due to new technologies and changing customer mindsets.

Known for being one of the main industries that is easily impacted by external forces, many questions have recently come up regarding the state of hospitality today. What trends are shaping its future? What makes it still one of the world's fastest-growing industries? How can it remain competitive? How to deal with the post-Covid staff shortages?

Read on to find out the experts' guide on what is happening in this exciting, evolving, and resilient sector.

  • Brief history of Hospitality
  • How Fast is the Hospitality Industry Growing?

Hospitality Industry Overview: key statistics

Hospitality industry growth: what trends are driving it.

  • What Major Challenges is the Hospitality Industry Facing?

Travel and Hospitality Industry: top trends

What the top ceos are saying about the future of the hospitality and tourism industry, what leaders can do to ensure hospitality businesses remain competitive.

  • The hospitality management careers of tomorrow

Future of hospitality: what's on the horizon for hospitality & tourism professionals

A brief history of hospitality, how has the hospitality industry evolved since its origins.

Derived from the latin word “hospes”, meaning host (one who provides lodging or entertainment for a guest or visitor), hospitality has its roots in ancient history. The ancient Greeks used the word "xenia" to define the sacred rule of hospitality: the generosity and courtesy shown to those who are far from home or associates of the person bestowing guest-friendship. Away from home, surrounded by strangers and yet feeling welcome.

Although the original concept of hospitality has remained largely unchanged since its origins (meeting travelers’ basic needs such as providing food and accommodation), the idea of building hotels for the sole purpose of hosting guests emerged alongside technological advances and better means of transportation towards the end of the 18th century. Since then, the sector been in constant expansion due to the very concept of hospitality being applicable to any sector that deals with customer service and satisfaction.

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How fast is the Hospitality Industry growing?

Along with the overall economy, the global hospitality industry has enjoyed a spurt of massive growth over the last decade since the end of the financial crisis. According to the World Bank , the global economy has grown at a pace of more than three percent per year up until the global pandemic hit in 2019/20. Due to pent up demand during the beginning of the COVID-19 pandemic there was an acceleration of the global economy in 2021 of 5.5 percent growth, however it is set to decelerate to 4.1 percent in 2022 and 3.2 percent in 2023, arriving back at pre-pandemic levels.

This unprecedented expansion over the last decade has benefited the hospitality and tourism industry by stimulating the world population’s travel activity, adding countless room nights in both leisure and business travel .

1. International arrivals have increased from 900 million to more than 1.3 billion over a span of just ten years.

Not only has this boosted the number of rooms on offer, but has also led to a major contribution of global employment opportunities. Covid-19 had a severe impact and international tourist arrivals according to figures from UNTWO , which after years of steady annual growth saw a staggering -73% drop in arrivals in 2020 and -71% in 2021 due to travel restrictions in response to Covid-19.

All in all 2020 is recognized as the worst year in tourism history with 1 billion fewer international arrivals and US $ 1.1 trillion in international tourism receipts. Around -74% drop according to the latest data from World Tourism Organization (UNWTO) a level of 30 years ago.

However, so far the travel industry has seen an extremely positive bounce back. New data from UNTWO found that, overall, international arrivals reached 80% of pre-pandemic levels; in the first quarter of 2023.

Tourism figures are heading in the right direction as an estimated 235 million tourists traveled internationally in the first three months, more than double the same period of 2022.

2. The World Travel and Tourism Council ( WTTC ) names the hospitality industry’s importance as a main driver in global value creation.

Recent figures published by the WTTC found that in 2022 the Travel & Tourism sector made a contribution of 7.trillion USD to the global economy, 7.6% of the global GDP and 23% below pre-pandemic levels.

3. The hospitality and travel industry accounts for one out of every ten employment opportunities.

Bringing the number of people earning their living in the sector to a remarkable 330 million in 2022.

In 2022, there were 22 million new jobs, representing a 7.9% increase on 2021, and only 11.4% below 2019.

The rise in revenue does not only benefit international companies and hotel owners, but also acts as a major factor in job creation for local populations and destinations. As of the latest data, around 173 million people were employed in the hotel and motel industry before the Covid-19 pandemic hit.

The WTTC forecast that there will be an additional 126 million jobs created between now and 2032.

4. The overall growth in the travel and tourism industry stands at +5.8% Vs. Overall GDP +2.7%.

According to the Hospitality Global Market Report 2023 the global hospitality marketgrew from $4,390.59 billion in 2022 to $4,699.57 billion in 2023 at a compound annual growth rate (CAGR) of 7.0%.

This large growth rate is in part the bounce back from global restrictions on travel. The market is expected to continue growing but at a slower rate due to the global economic situation with a Compound Annual Growth Rate (GAGR) of +5,8% forecasted between 2022 and 2032.

hospitality industry growth

Image source: World Travel & Tourism Council, Travel & Tourism Economic Impact 2022

1. The global economy growth has created positive momentum in the sector by contributing to the overall income per capita.

Since 2009, the global GDP has constantly increased at an average pace of almost two percent per annum, leading to a growing demand for both international and domestic travel spending. Whilst the Covid-19 pandemic led to a shock -2.81% decline in GDP in 2020 according to Statista , 2022 figures and subsequent projections for 2023 show year-on-year growth.

2. Airfares have consistently become more affordable over the last three decades, but will this last?

Thanks to lower fuel prices, carrier competition and the rise of low-cost airlines . While these are not happy news for the airline industry, which is using ancillary fees to increase profit margins, it benefits travelers who can get more from their purchasing power. However the emerging global energy crisis could put a halt to such a trend and airlines could pass on the price hikes to the consumer, which will in turn impact consumer travel behaviour.

3. Corporate travel is yet another contributor to the healthy outlook and is projected to keep growing.

In China and India, the growth of business travel is particularly steep due to the relentless pace of economic expansion in this part of the world.

4. The health and wellness segment has boomed in recent years.

There has never been so much appetite among the public for wellness and the escapism travel can offer from life’s stresses - the pandemic taught us to slow down and not to take our health for granted.

The global consumer health and wellness market is a $1.5 trillion market growing at 5 to 10 percent a year, and, according to a recent McKinsey survey, people around the world are increasingly interested in taking care of themselves and are planning to spend more money on wellness products and services.

5. Hotel operators are seeking to expand their portfolios through targeted acquisitions of smaller regional chains.

Mergers and Acquisitions activity in hospitality has somewhat cooled over the last few years , with operators seeking to expand business in a more controlled way.

What major challenges is the Hospitality Industry facing?

1. the threat of climate change.

The threat of climate change will adversely impact many major tourist destinations. Threats resulting from climate change, safety and security issues, as well as unprecedented migration streams are tomorrow’s game changers. The main challenges for the hospitality industry are the lack of predictability and the magnitude of such events – and how fast the industry can react and adapt. Hybrid operations might be one of the hospitality 4ndustry’s possible responses to increased risks.

2. Industry consolidation

Corporate consolidation has led to increasing concentration of size and power among the top players. Hotel operators will seek to expand their portfolios through targeted acquisitions of smaller regional chains. While the ultimate goal is to create value through cross-organizational synergies, this development also comes with downsides, as the management of structures with a diverse selection of geographies and a plethora of brands generates more complexity and threatens to increase overall rigidity.

Marriott and Hilton remain the world’s most valuable hospitality brands, valued in 2023 at $53.5B and $37.99B respectively.

3. New competition from tech and digital players

Are major technology firms such as Google or Facebook threatening to replace hotel brands by offering technological solutions and creating novel markets to attract new types of customers? Thanks to their control over all types of data related to customer behavior both off- and online, tech behemoths could oust traditional incumbents into niche markets. Companies that fail to identify their niche are at risk of becoming mere revenue generators for technology companies. Some big enough brands may survive, but their business will get tougher .

4. Skilled talent shortage

As the accommodation and restaurant industry is creating jobs at the fastest rate of any sector in the economy according to the International Labor Organization, fuelling this growth with the right skilled labor is yet another concern for owners. Attracting and retaining younger generations of hospitality professionals will require a lot of flexibility and attention from hoteliers in the future.

5. Energy Crisis 

The global energy crisis is the perfect storm of multiple factors causing a huge surge in energy demand which the limited global resources are struggling to fulfil. Added to this is Russia’s invasion of Ukraine, one of the main suppliers to Europe. Whilst the world grapples with accelerating the development of green infrastructure, the hospitality industry has an even bigger incentive to make efforts to switch to renewable energy sources where possible, not only as our environmental social responsibility but also to reduce the reliance on particular states which fuels the weaponization of energy.

6. Supply Chain Issues

Supply chain issues have affected most of the world, although Europe was the hardest hit, according to data from the 2022 State of the Third-Party Logistics Industry Report by Extensiv.

These issues are ongoing and are triggered by undulating demand, price volatility and uncertainty. The hospitality industry is affected on an operational level when bottlenecks cause delays on delivering food & drink, bed linen, housekeeping products and other replenishable goods. Running out of these items means giving customers a disappointing experience and leaving a poor impression that could diminish the business’s reputation.

7. Economic downturn

According to the UNWTO Panel of Experts , the economic situation remains the main factor weighing on the effective recovery of international tourism in 2023, with high inflation and rising oil prices translating into higher transport and accommodation costs. As a result, tourists are expected to increasingly seek value for money and travel closer to home.

Is there a silver lining? Well, we know that economic downturns make way for innovation and entrepreneurship ! The public needs new solutions for new problems, so now may just be the time to start thinking of your next business venture.

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1. Sustained disruption from online travel agents (OTAs) and digital players

Online travel agents (otas).

Well-established OTAs are continuing to look for new ways to challenge the hotel industry. Expedia , for instance, has been expanding its global presence by focusing on "brand-agnostic customers" through more relevant local offerings and content strategies. A world in which we no longer search for information via browsers and apps as we do now, but instead ask a virtual personal assistant – whether it be ChatGPT, Google's Bard, Amazon’s Alexa , or Apple’s Siri – to book holidays or business trips for us - may not be too far off. In the wake of these changes, there are many aspects for hoteliers to pay attention to, but there are also lessons to be learned in order to better equip traditional providers for what lies ahead.

Airbnb’s rapid expansion, embodied by its strategy roadmap aptly dubbed “Airbnb For Everyone” is another example of aggressive efforts for non-traditional hospitality industry players to play on traditional hotel business territory. The digital giant has drastically expanded the type of properties available to customers - from vacation homes and B&Bs to experiences or collections. The company cut 2,000 employees in May 2020 and refocused on its core services: home rentals and activities hosted by locals in their respective cities. Airbnb is putting emphasis on the fact that it is now commonplace for business meetings to be attended virtually, people will travel more often for pleasure rather than business. Airbnb is still considered a highly valuable leisure brand with a value of $80.33 billion. 

Google has clearly been placing bets on the travel and hospitality industry by consolidating various offerings into its Google Travel (formerly known as Google Trips) interface - tapping into its gigantic trove of user data and delivering highly relevant information to users across the various stages of their trip planning. Its tools include flight and hotel information, holiday rentals and things to do when you're at the destination and put the company in a comfortable position when competing not only with major hotel chains but also OTAs.

2. Big Data, AI and customization in the hospitality industry

Data is everywhere, and for companies that know how to collect and store it correctly, it can be a major success factor. Big Data Analytics can help operators correctly predict whether high-rolling guests spending thousands of dollars on expensive food and drinks are merely celebrating a special occasion or if this is the clients’ usual behavior while traveling. This sort of information is crucial in efforts to determine a customer’s lifetime value. A deep understanding of customer needs and wants through collected information also enables hoteliers to stay relevant through their ability to offer personalized services to every guest, thus increasing their likeliness to return. Unfortunately, many hotel owners tend to confuse personalization with simply selling upgrades or improving their bulk email marketing. Hoteliers need to understand the benefit of true personalization and invest in the necessary tools and technologies to leverage customer data. When it comes to ensuring that each room is sold at the highest price possible, revenue management is used to focus primarily on setting room prices and optimizing room inventory. Today, Revenue Management strategy goes beyond those aspects, and revenue managers should look for new ways to optimize revenue growth and profitability through dynamic pricing and d ata integration .

3. Digital transformation in the hospitality business

In today’s ever-connected environment, addressing current challenges head-on means embracing the possibilities offered by an end-to-end customer experience. It is not about merely relying on a loyalty program anymore, it is about creating a broad and connected ecosystem across all brands and touchpoints.

Major players in the industry - such as Accor - have already realized the immense potential of new technologies and are currently looking for ways to incorporate them into their client offering. Many smaller hotel brands and independent hotels are slow to adopt new technologies, in part due to costs as well as the skills gap the hospitality labor market is experiencing. 89% of travel and tourism companies think the skills gap in local labor markets is a barrier to adoption of new technologies.

An area where traditional hoteliers are lagging behind their more advanced counterparts is online visibility and brand recognition . In the past, some brands were able to create their markets based on the number of properties or an outstanding service offering. With the dawn of the internet and the connected rise of OTAs however, this trend has been disrupted. Because of the immense amount of indifferentiable hotel brands, hotel chains can already barely compete with online travel and booking players, making new competitive strategies inevitable.

4. Millennials and Gen Z travel trends: experience economy & customization

Millennials are a hugely attractive segment, representing two billion people globally. Their collective eCommerce spending is set to overtake Generation X in 2023 , so it is not surprising that hotels have picked up on this trend. Many hoteliers are discussing how to best approach this group of customers and how to stay attractive in light of changing values and behavior. Hotel chains have launched brands designed to appeal to this demographic segment, often reducing guest room sizes and putting more emphasis on creating convivial common areas. On the horizon, however, the post-millennials of Generation Z are already picking up speed. Both generations’ need for unique experiences has led to the surfacing of the experience economy . This buzzword describes the transition from a product- and service-driven economy to an experiential one. The combination of advances in technology with the changing values of consumers have led to the success of social media and sharing networks as commercial platforms. This provides an opportunity for traditional hotel brands to leverage their existing brand equity to offer a range of more focused services and experiences that go beyond hotel stays.

5. Beyond the traditional hotel brand

After detaching themselves from physical assets, the time seems right for hotel brands to capitalize on their brand equity and find opportunities beyond traditional hotel stays to become universal travel and service brand. Wherever service and design elements are key to the experience delivery, hospitality brands have an opportunity to add and improve on the existing product. In turn, this allows hospitality brands to create significantly more customer touchpoints with their target markets and collect more insights to help them create an ecosystem of services that could leverage off each other. As a way of circumventing hypercompetitive markets, hotels will also increasingly have to focus on niche markets , where customers are looking for a specific experience or service. "We categorize niche markets in the sense they could be royalty, they could be fashion, art, entertainment. They could be anyone of those items and we’ve actually been operating our business based on that for a long time" Mathew Nixon, Business and operations transformation at Dorchester Collection.

6. Towards sustainable hotels

With the impact of climate change becoming more and more apparent, societal pressure on providers in all industries is mounting. First steps are being taken, for instance, in the fight against single-use plastic products that are part of the roughly 300 million tons of plastic produced each year. Many major corporations and businesses are opting to ditch single-use plastics from their day-to-day operations and the hospitality space is no different . Hotels and airlines find themselves with a unique opportunity to really impact the effects of global plastic consumption as they often provide disposable products at mass scales. Many critics say that the practice of reducing plastic waste is, while commendable, not nearly enough to make a true impact in the fight against rising temperatures. A growing number of hotels are rising up to the challenge of running a sustainable business. Beyond plastic usage, general waste production, food waste, usage of local produce, energy and water consumption and many other factors are to be considered for operators that are serious about their claim. Going one step further, the term sustainability is also often used in relation to not only environmental protection, but also corporations’ approach to managing their people and their finances. All across the board, resources of all kinds are being used more efficiently in the hospitality industry and while there are various strategies being adopted by hotels, a paradigm shift is becoming more recognizable. 

Future of hospitality

As an industry that depends on a stable environment in order to successfully operate - societal and environmental changes are having a greater impact on hospitality businesses compared to other industries. A recent global survey among CEOs by PwC has shown that heads of hospitality and leisure companies are notably less confident about their companies’ prospects for revenue growth in the near future than their counterparts in other sectors.

With disruptors in the industry, a wave of consolidation, and many external factors impacting their operations, hotel operators must find new ways to overcome these hurdles. Solutions to future challenges that companies are currently coming up with are the result of new thinking among the world’s business leaders and CEOs.

In a crowded field of competitors, hotels must find ways to distinguish themselves and position their property as distinctive destinations for customers , to develop preferences and loyalty in order to drive direct bookings. To do so, hotels must offer more highly personalized experiences that anticipate and go beyond the needs of their target customers – and count on word of mouth and allegiance to not only retain their customer base, but also grow it with more potential customers.

We have been a super good hospitality group for the last 50 years. We are not shying away from it. We are shifting and expanding the hospitality notion to Augmented Hospitality. We are being even more audacious and going one step further by saying: Since people want to be recognized, want to have something extremely personalized, why don't we try going from Augmented Hospitality to a Lifestyle Augmented Hospitality player? Sébastien Bazin, Chairman and CEO of Accor (Source: Accor TV - New Accor Strategy).

Other ways that are often discussed when dealing with the impending changes are the implementation of new technologies, training employees to move away from standard SOPs to become true high-touch experience providers and modernizing the service offering towards individualization and “lifestyle” to create true differentiation.

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Fully take advantage of technology and personalization to create experiences

A generational shift towards how travelers are consuming hospitality services is making hotels evolve from being mere suppliers of accommodation to experience providers, leading to a need for outstanding customer relationships across all stages of their customer booking journeys .

Focus on talent acquisition and retention

From targeted recruitment efforts to a meaningful interview process and to the actual hiring and onboarding, organizations that are well-equipped to recruit in the era of millennials think holistically about the overall experience delivered to potential hires .

Embrace sustainability as part of your business model

As a result, a growing number of international hotel companies have developed sustainability and corporate social responsibility strategies . These initiatives can be perceived as the beginning of a paradigm shift toward a more positive and conscious form of hospitality which is highly valued among consumers today.

Future of hospitality

The hospitality management careers of tomorrow;

Reshaping the future of hospitality jobs.

Over the past two decades, the hospitality industry has experienced significant growth, with international arrivals doubling from 600 million to over 1.4 billion in 2016 .

In 2023 however, in the wake of the global pandemic and facing increasing economic uncertainty hospitality has shown that it is resilient and a sector that consumers are just not willing forego entirely. Travel and tourism is an integral part of our lives therefore even as the global economy retracts the industry will always bounce back. This ability to withstand difficult times makes it a viable sector to launch a career for anyone with a hospitality mindset and appreciation for top-level service, culture, and leisure experiences.

It's clear that the industry is evolving and adapting all the time, making it a fantastic career opportunity for the problem solvers and innovators of tomorrow. Hospitality Management will provide a career rich in experiences, human connection, personal development and comes with many perks.

Employers across the board are looking for professionals with a combination of both hard and soft skills . In hospitality, developing skills such as cultural awareness, multitasking, customer service and communications is paramount to effectively deliver outstanding customer experiences.

The increasing complexity of the hospitality sector and evolution of its modus operandi - due to the expanded use of technology and data, the evolution of business models with the separation of management from operations or the ever-increasing trend of brands becoming publishers - is leading to the creation of new job profiles , such as asset managers, data scientists or content marketing specialists.

The Covid-19 crisis has underlined the global importance of the travel and tourism industry economically as well as its interconnection with other industries. From small tour operators to multinational hotel chains and major airlines, everyone in the industry has been impacted and continue to reset and recover.

To every negative repercussions of a crisis there is also some positive change that could be foreseen for the future. The World Economic Forum’s recent “Rebuilding Travel and Tourism panel” at the “Sustainable Development Impact Summit” explored the intersection of consumer consciousness, acceleration of technology and destination management and found some solutions that could have the potential to reshape the way we market, manage and plan our travel:

  • Travelers are becoming more impact-conscious
  • Tourists are looking for experiences in nature
  • Digital solutions are improving sustainability
  • Long-term progress requires cooperation

The end result is in an industry that will recover as it is an essential part of modern human lives that derive much pleasure and discovery from it. It is simultaneously undergoing huge digital transformation and other shifts to adapt to consumer sentiment, therefore a career in hospitality won't necessarily be a quiet one, but it will be an exciting adventure with a multitude of possible career paths to explore.

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10 Ways on How to Improve Hotel Operations

10 Ways on How to Improve your Hotel Operations by XOTELS

If you’re reading this, chances are you’re looking for ways to improve your hotel´s operational performance – and you are unsure what actions to take and which tasks to prioritize. And understandably so, since creating a successful hotel business is anything but a straightforward – cookie-cutter process and success definitely doesn’t come overnight… It requires careful planning, prioritization and dedication to achieve great results for a hotel.

Running operations as a hotel management company for a diverse portfolio of independent and boutique hotels in a variety of cities and countries, we have seen the same concerns pertaining prioritization and decision making. There is always room for improvement on challenges the hotel industry faces , whether it is making the right decisions, optimizing work processes, providing higher quality service, or aligning departments and objectives.

Let’s dig into the following best practices and strategies to improve your hotel operations:

Impact of COVID-19 on Operations

  • Making the Right Decisions
  • Know your Guests and Personalize
  • Preparation is Key: Don’t wait until your Guests Arrive!
  • Empower your Employees
  • Create a Culture of Ownership
  • Communicate and Cross-communicate
  • Work smarter, not Harder…
  • Standardization, The Key to Building a Strong Brand
  • Leverage Technology and Software for Efficiency
  • Opting for Outsourcing to Uncover Hidden Potential

The key to providing exceptional customer service, and thereby, creating a successful hotel business, starts with hotel operations at the foundation. Losing focus or neglecting operations is likely to cause major performance issues. So how does this work, in times where travel is not fully recovered, and subsequently, staffing levels are not back at what they used to be. Unfortunately, we can’t sit back and wait for better times to arrive. Now is the time to take action and make your hotel stand out. Let’s find out!

1. Making the Right Decisions

Anyone working in the will know that it is easy to get overwhelmed by the number of tasks and opportunities that are always at hand. For this reason, it is highly important to set priorities . Without establishing the right set of priorities you will run the risk of overlooking more important responsibilities that can directly compromise service quality of your hospitality operations.

My recommendation is to always start with a logical outline based on the following question:

“What brings the most value to your guests?”

Following the same reasoning, you can start establishing which processes and initiatives constitute to building a great guest experience. Importantly, this can be done on a case-per-case basis that is adaptable to accommodate the wide variation in products and services inherently present in the hotel industry.

2. Know your Guests and Personalize

Another question that hoteliers should ask themselves is “do you know what your guests want?”. If not, it’s about time to get to know them a little better! Start reaping the benefits of a well built and maintained customer database.

“Do you know what your guests want?. If not, it’s about time to get to know them a little better!”

Through personalizing services and products you can increase revenue and customer experience. An essential step is to focus on recording guest preferences and thoroughly developing their profiles, which should all be tracked in your hotel´s operating software CRM. Also, don’t forget to push the importance of capturing hotel guest data and email addresses to your staff. Without their efforts this strategy will struggle to take off!

Prepare for your guests arrival at the front desk. Don´t wait until they arrive at the hotel to improve hotel operations.

3. Preparation is Key: Don’t Wait Until Your Guests Arrive!

Waiting for opportunities until the guest arrives will work against your operations in many ways. Instead, it is better to take a proactive stance and start driving customer experience and revenue from the get go. The benefits are abundant, namely:

Increase the interaction time with your guests:

  • Making the service feel more attentive and generally of a higher level;
  • Increase exposure of your products and services to your guests. This equals more revenue opportunities;
  • Higher chance the guest will get the most out of their stay, by providing them with more inspiring plans to add to their itinerary.

Facilitate a truly worry-free vacation!

Take care of the planning and decision making process. Curate a selection of various activities for different stay durations so every guest can just follow the itinerary without having to do their own research and planning.

Answer pre-arrival questions:

Any questions or issues can be answered before arrival, alleviating some workload that otherwise would be carried by front office staff.

Think of sending a welcome email (providing basic information and confirming their booking) followed by an email shortly before the guest´s arrival (directions to the hotel, parking information, things to do, products and services in the hotel incl. bookable options). This also proposes opportunities to drive traffic to your website (e.g. package pages and blog posts), which is always beneficial when it comes to SEO.

4. Empower Your Employees

Foster an environment centered around empowerment and training. Employees should be able to become the one person guests can go to for everything .  

Equipping them with the right knowledge and tools will help them in dealing with any unexpected situations. The confidence that is built in this process can both be felt by guests and the employees themselves, who will feel more comfortable and prepared for any situation they might encounter. 

Learning from different angles within the hotel will make this process a lot easier, so make sure to include cross-training between different departments and information sharing an integral part of the road towards empowerment.

Streamline Your Hotel Operations

We guide hotels and resorts toward unparalleled success, positioning them as market leaders.

operational plan hospitality industry

5. Create a Culture of Ownership

A problem we see too often is lack of ownership . Nothing is worse than making the guest feel like their issue is being passed on and on to others. You might even be better off saying that you’re not interested in dealing with the issue in the first place… This goes back to our previous point about empowering employees to take care of any situation by themselves. Dealing with issues directly shows you care and lets guests know you’re involved in ensuring they have a wonderful stay.

6. Communicate and Cross-communicate

One thing we’ll always keep preaching for is increasing the level of communication between departments and breaking existing silos. And for good reason. Cross-communication is the only way to overcome persisting operational bottlenecks . 

Solving complex issues and increasing performance across the board requires stepping away from working with blinders on. You´ll be surprised how many team members are still working in completely different directions from one another! Instead, start aligning objectives and heighten intern-departmental communication. By taking in different perspectives and ensuring crucial information can be shared openly, hotels can prevent unnecessary loss of efficiency and maximize opportunities.

7. Work smarter, Not Harder…

Find ways to reduce the execution time of operational processes without skimping on services. Working smarter will have a positive effect on service delivery time and reduce the workload carried by employees.

Front Office

Make it as easy for the guest! Plan their arrival ahead of time and make sure everything is ready upon check in. Complete their check in form as much as possible with the information on hand, allocate the right room, and have processes like express check in/out processes in place.

Food and Beverage

Find ways to improve your hotel´s food and beverage operations

More is not always more is hospitality. A great example of less is more can be reducing the menu size. Having a good look at the size of your menu and choice of ingredients can have a major impact on the performance of F&B operations. Smaller menus allow for faster preparation times, fresher ingredients, less risk of waste, and therefore, lower food cost. Also, don´t forget to look into including local ingredients on your menu while you’re at it, to guarantee the freshest produce and local experience is delivered to your customers.

Housekeeping  

Riding on the wave of improved sustainability efforts in hospitality, benefits can be obtained by bringing down linen and amenity refreshments, minimizing waste and energy consumption and reducing labor and material cost. Again, make sure to record this information for future reference in your systems so guests don’t have to communicate this twice.

8. Standardization, The Key to Building a Strong Brand

Talking about improving hotel operations can´t go without addressing SOPs, which are at the heart of a hotel´s operations. They play a key role in making sure processes run smoothly and guests are provided with the best service, as consistently as possible.

Writing SOPs seems like an easy task at hand, but be careful, taking the cookie cutter approach here could cost you dearly. We are mainly talking about two things here;

  • Every hotel is different , make sure your SOPs reflect that. Some workflows might work well for one hotel, but require small changes to make it work perfectly for another;
  • BRANDING! : making sure that your brand values are reflected in your SOPs is essential. It allows employees to adopt the values of your hotel and thereby communicate the brand message that you would like to portray much better to your guests.

9. Leverage Technology and Software for Efficiency

Technology plays an integral role in improving hotel operations. A solid tech stack can help hotels save time and improve guest experience. Specifically, the below tools can greatly improve your hotel´s operational performance:

PMS (Property Management System) & POS (Point of Sale System)

  • Frictionless interaction with customers;
  • Reduce labour intensity and risk of errors through automation;
  • Access to better data (less prone to errors than manual reporting);
  • Well designed systems allow for features such as keyless check in.

CRM system (Customer Relationship Management)

  • Drive loyalty and increase service level through personalized offerings;
  • Automated marketing initiatives including email campaigns.

RMS (Revenue Management System)

  • More in-depth analysis of hotel performance;
  • Less time consuming analysis.

Internal collaboration tools

  • Software to manage guests preferences, requests, complaints, maintenance, housekeeping, internal communication and more…

10. Opting for Outsourcing to Uncover Hidden Potential

As we said at the start of this article, success doesn’t come overnight, requiring tremendous effort and focus on the right initiatives to eventually get great results. Piecing together these puzzle pieces can leave a strain on the employees and management, causing them to lose focus which is where performance usually starts to slip. Solving performance issues can often become too big of a burden to carry for hotels that don’t possess the required expert in-house know-how. Opting for hotel management consulting services can be the key to unlock the true potential of a hotel.

Ready to tackle your hotel operations and increase your performance? Hopefully, this article helped to get your eyes on the right objectives to get your hotel operations back on track!

Patrick Landman

Need help with improving your hotel’s operations? Click here to see which Hotel Management & Consulting Services we provide to turn your hotel´s performance around.

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10 ways to improve hotel operations

Patrick Landman

Ways to improve hotel operations

Running operations as a  hotel management company  for a diverse portfolio of independent and boutique hotels in a variety of cities and countries, we have seen the same concerns pertaining prioritization and decision making. There is always room for improvement on numerous aspects of the business, whether it is making the right decisions, optimizing work processes, providing higher quality service, or aligning departments and objectives.

Let’s dig into the following best practices and strategies to improve your hotel operations:

Impact of COVID-19 on Operations

  • Making the Right Decisions
  • Know your Guests and Personalize
  • Preparation is Key: Don’t wait until your Guests Arrive!
  • Empower your Employees
  • Create a Culture of Ownership
  • Communicate & Cross-communicate
  • Work smarter, not Harder…
  • Standardization, The Key to Building a Strong Brand
  • Leverage Technology and Software for Efficiency
  • Opting for Outsourcing to Uncover Hidden Potential

The key to providing exceptional customer service, and thereby, creating a successful hotel business, starts with hotel operations at the foundation. Losing focus or neglecting operations is likely to cause major performance issues. So how does this work, in times where travel is not fully recovered, and subsequently, staffing levels are not back at what they used to be. Unfortunately, we can’t sit back and wait for better times to arrive. Now is the time to take action and make your hotel stand out. Let’s find out!

IRIS Banner - Leaderboard

1. Making the Right Decisions

Anyone working in the will know that it is easy to get overwhelmed by the number of tasks and opportunities that are always at hand. For this reason, it is highly important to  set priorities . Without establishing the right set of priorities you will run the risk of overlooking more important responsibilities that can directly compromise service quality of your hospitality operations.

My recommendation is to always start with a logical outline based on the following question:

“What brings the most value to your guests?”

Following the same reasoning, you can start establishing which processes and initiatives constitute to building a great guest experience. Importantly, this can be done on a case-per-case basis that is adaptable to accommodate the wide variation in products and services inherently present in the hotel industry.

2. Know your Guests and Personalize

Another question that hoteliers should ask themselves is “do you know what your guests want?”. If not, it’s about time to get to know them a little better! Start reaping the benefits of a well built and maintained customer database.

“Do you know what your guests want?. If not, it’s about time to get to know them a little better!”

Through  personalizing services and products  you can increase revenue and customer experience. An essential step is to focus on recording guest preferences and thoroughly developing their profiles, which should all be tracked in your hotel´s operating software CRM. Also, don’t forget to push the  importance of capturing hotel guest data and email addresses  to your staff. Without their efforts this strategy will struggle to take off!

3. Preparation is Key: Don’t wait until your Guests Arrive!

Waiting for opportunities until the guest arrives will work against your operations in many ways. Instead, it is better to take a  proactive stance  and start driving customer experience and revenue from the get go. The benefits are abundant, namely:

Increase the interaction time with your guests:

  • Making the service feel more attentive and generally of a higher level;
  • Increase exposure of your products and services to your guests. This equals more revenue opportunities;
  • Higher chance the guest will get the most out of their stay, by providing them with more inspiring plans to add to their itinerary.

Facilitate a truly worry-free vacation!

Take care of the planning and decision making process. Curate a selection of various activities for different stay durations so every guest can just follow the itinerary without having to do their own research and planning.

Answer pre-arrival questions:

Any questions or issues can be answered before arrival,  alleviating some workload  that otherwise would be carried by front office staff.

Think of sending a welcome email (providing basic information and confirming their booking) followed by an email shortly before the guest´s arrival (directions to the hotel, parking information, things to do, products and services in the hotel incl. bookable options). This also proposes opportunities to drive traffic to your website (e.g. package pages and blog posts), which is always beneficial when it comes to SEO.

4. Empower your Employees

Foster an environment centered around empowerment and training. Employees should be able to become the  one person guests can go to for everything .

Equipping them with the  right knowledge  and  tools  will help them in dealing with any unexpected situations. The confidence that is built in this process can both be felt by guests and the employees themselves, who will feel more comfortable and prepared for any situation they might encounter.

Learning from different angles within the hotel will make this process a lot easier, so make sure to include cross-training between different departments and information sharing an integral part of the road towards empowerment.

5. Create a Culture of Ownership

A problem we see too often is  lack of ownership . Nothing is worse than making the guest feel like their issue is being passed on and on to others. You might even be better off saying that you’re not interested in dealing with the issue in the first place… This goes back to our previous point about empowering employees to take care of any situation by themselves. Dealing with issues directly shows you care and lets guests know you’re involved in ensuring they have a wonderful stay.

6. Communicate and Cross-communicate

One thing we’ll always keep preaching for is increasing the level of communication between departments and breaking existing silos. And for good reason. Cross-communication is the only way to  overcome persisting operational bottlenecks .

Solving complex issues and increasing performance across the board requires stepping away from working with blinders on. You´ll be surprised how many team members are still working in completely different directions from one another! Instead, start aligning objectives and heighten intern-departmental communication. By taking in different perspectives and ensuring crucial information can be shared openly, hotels can prevent unnecessary loss of efficiency and maximize opportunities.

7. Work smarter, not Harder…

Find ways to reduce the execution time of operational processes without skimping on services. Working smarter will have a positive effect on service delivery time and reduce the workload carried by employees.

Front Office

Make it as easy for the guest! Plan their arrival ahead of time and make sure everything is ready upon check in. Complete their check in form as much as possible with the information on hand, allocate the right room, and have processes like express check in/out processes in place.

Food & Beverage

More is not always more is hospitality. A great example of  less is more  can be reducing the menu size. Having a good look at the size of your menu and choice of ingredients can have a major impact on the performance of F&B operations. Smaller menus allow for faster preparation times, fresher ingredients, less risk of waste, and therefore, lower food cost. Also, don´t forget to look into including local ingredients on your menu while you’re at it, to guarantee the freshest produce and local experience is delivered to your customers.

Housekeeping

Riding on the wave of improved sustainability efforts in hospitality, benefits can be obtained by bringing down linen and amenity refreshments, minimizing waste and energy consumption and reducing labor and material cost. Again, make sure to record this information for future reference in your systems so guests don’t have to communicate this twice.

8. Standardization, The Key to Building a Strong Brand

Talking about improving hotel operations can´t go without addressing SOPs, which are at the heart of a hotel´s operations. They play a key role in making sure processes run smoothly and guests are provided with the best service, as consistently as possible.

Writing SOPs seems like an easy task at hand, but be careful, taking the cookie cutter approach here could cost you dearly. We are mainly talking about two things here;

  • Every hotel is different , make sure your SOPs reflect that. Some workflows might work well for one hotel, but require small changes to make it work perfectly for another;
  • BRANDING! : making sure that your  brand values  are reflected in your SOPs is essential. It allows employees to adopt the values of your hotel and thereby communicate the brand message that you would like to portray much better to your guests.

9. Leverage Technology and Software for Efficiency

Technology plays an integral role in improving hotel operations. A solid tech stack can help hotels save time and improve guest experience. Specifically, the below tools can greatly improve your hotel´s operational performance:

PMS (Property Management System) & POS (Point of Sale System)

  • Frictionless interaction with customers;
  • Reduce labour intensity and risk of errors through automation;
  • Access to better data (less prone to errors than manual reporting);
  • Well designed systems allow for features such as keyless check in.

CRM system (Customer Relationship Management)

  • Drive loyalty and increase service level through personalized offerings;
  • Automated marketing initiatives including email campaigns.

RMS (Revenue Management System)

  • More in-depth analysis of hotel performance;
  • Less time consuming analysis.

Internal collaboration tools

  • Software to manage guests preferences, requests, complaints, maintenance, housekeeping, internal communication and more…

10. Opting for Outsourcing to Uncover Hidden Potential

As we said at the start of this article, success doesn’t come overnight, requiring tremendous effort and focus on the right initiatives to eventually get great results. Piecing together these puzzle pieces can leave a strain on the employees and management, causing them to lose focus which is where performance usually starts to slip. Solving performance issues can often become too big of a burden to carry for hotels that don’t possess the required expert in-house know-how. Opting for  hotel management consulting  services can be the key to unlock the true potential of a hotel.

Ready to tackle your hotel operations and increase your performance? Hopefully, this article helped to get your eyes on the right objectives to get your hotel operations back on track!

operational plan hospitality industry

CEO of Xotel, Barcelona, Spain

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  • Hotel Operations: what they are, and how you can improve them?

Hotel Operations

  • Travel & Hospitality

Picture this: 

You’re the manager of a well-reputed hotel. All operations run smoothly with the help of all-in-one technology. A unified system gives you access to your front desk, bookings, revenue management, and guest information.  

Your employees focus their time on creating positive customer experiences . You have all the data you need to monitor your hotel in a centralized platform. The technology reduces turnaround time and increases efficiency.  

In contrast, what happens if you don’t integrate all your operations? 

You end up with conflicting databases when you fail to integrate your hospitality management solutions . This leads to you receiving multiple reports from each system. You won’t have centralized storage because each platform will maintain and keep track of your visitor database differently.  

A comprehensive guest database is essential to providing a positive customer journey. You won’t give the best guest experience possible without integrating all your tools.  

You must centrally manage all aspects of your hotel operations with an all-in-one management system . With this, you’ll receive integrated reports about your bookings, marketing, and revenue management. You may then easily monitor your progress and plan how to grow your hotel business. 

Why should you integrate your hotel technologies?

A property management solution is only as efficient as its scalability and interoperability. The majority of hoteliers rely on a variety of products from several vendors. And for the hotel’s everyday operations to run well, data among these systems needs to be quickly and effectively communicated.  

You won’t experience the difficulties of employing a standalone solution once you implement such technology. You can automate all hotel operations when you integrate them into a single system, like a complete Hospitality CRM . You don’t need to switch between systems, monitor business performance, locate information, or perform other tasks. 

But wait, what exactly are these hotel operations I keep mentioning? 

What are hotel operations?

Hotel operations is a broad concept that refers to the highly interconnected divisions operating a hotel. Hotel operations in general includes: 

  • Managing the hotel and its processes
  • Guaranteeing a high level of service to guests
  • Tracking the progress of revenue, expenses, and other corporate financial details
  • Property maintenance
  • Guest meals and beverages service
  • Employee management
  • Housekeeping
  • Hotel promotions
  • And reservation processing 

The various aspects that makeup hotel operations must work together in harmony. This necessitates meticulous integration of operations as well as swift communication between teams. A hotel can run efficiently and deliver high-quality service only if all these elements are in-sync. 

Hotel operations call for a highly interconnected system that ensures you deliver high-quality service. We know what hotel operations are, but what are some signs you need to look out for when running a hotel? 

Five signs that you need to improve hotel operations 

1) negative feedback and reviews .

Maintaining a positive online reputation on top travel blogs and social media platforms is vital for a hotel’s performance. If your hotel frequently earns low ratings and negative reviews, it’s time to figure out what’s wrong.  

According to Podium’s 2021 State of Reviews research, 

  • 83% of visitors agree that reviews must be current and meaningful to trust them. 
  • 38% of consumers want to see a 4-star rating before connecting with an establishment.  
  • Around half of the consumers are ready to travel further and spend more to visit a business with positive feedback. 

A hotel with anything less than a 4-star rating is much less likely to experience full occupancy. Even if your hotel’s past reviews are positive, consumers expect recent positive reviews.  

Negative guest feedback can be damning for anyone in the hospitality industry. But this doesn’t mean you can’t turn the tide. With the right tools, you can build the most enjoyable customer journeys.  

2) Inaccurate guest details 

83% of consumers are ready to share their preferences for a more personalized experience . When your data is inaccurate, your hotel’s staff misses out on priceless possibilities to connect with your visitors.  

For instance, you notice your staff have little time to interact with guests and are scrambling around for information. It’s a surefire sign that you need a system with centralized guest information. If you’re worried about guest privacy, just invest in GDPR and HIPAA-compliant solutions.  

Three-quarters of consumers also value the concept of “living profiles.” Customer profiles reveal information about: 

  • Demographic details
  • Shopping habits  
  • And individual interests/preferences

Identifying what type of guest enjoys your hotel enables you to make customized offers in the future. You can use this data to retain existing guests and attract similar leads. When you fail to collect accurate guest information, you miss opportunities to optimize their experience.  

3) Missed reservations or bookings 

Hotel bookings and room reservations can be a nightmare without the right tools. In a study conducted in 2018, the researchers found: 

  • Direct website reservations accounted for 66.7% of bookings 
  • Marketplace bookings accounted for 9.1%,  
  • And third-party service bookings accounted for 24.3%.  

Hotels must collect information from each of these resources in a timely and orderly manner. Your hotel needs a system that streamlines booking information.  

When you collaborate with a third-party site, the information is less likely to reach you instantly. Missed reservations or bookings inflict considerable damage in the following ways: 

  • Guests may be unable to find a room in your hotel
  • Which may result in negative reviews and ratings  
  • Leading to a loss of revenue in the long run

Hotels need a platform that integrates and consolidates such information to guarantee they don’t miss any bookings.  

4) Lengthy turnaround time 

The length of a procedure from beginning to end is what we refer to as “turnaround time.” The majority of businesses desire quick turnaround times over those that take longer. Hotels are no different. 

High customer traffic is a common occurrence at hotels. Especially in a resort or popular hotels, lineups at the front desk are the norm. Naturally, these wait times have a terrible effect on customer satisfaction ratings.  

Cornell University researched how wait times affect customer satisfaction. They found that anything over a 5-minute wait reduced customer satisfaction for American visitors by 47% .  

Digitizing check-in/check-out processes can help hoteliers overcome this issue. Integrating all your hotel management software with the help of APIs can also guarantee high efficiency.  

5) Difficulty running daily operations 

Difficulty in carrying out day-to-day tasks is the biggest red flag in any hotel. This might result in  

  • Information gaps
  • Lack of revenue tracking
  • Poor customer service

Hotels rely heavily on every team’s interconnected effort to perform efficiently. A slip-up in any of the departments will affect the entire structure at the end of the day. Hoteliers must deal with a variety of challenges daily, such as: 

  • Reservations management
  • Revenue management
  • Room maintenance
  • Staff supervision
  • Front desk management 

As a result, many hoteliers are opting for digital solutions for efficient hotel operations. 70% of hoteliers in a Statista survey state that they want hotel technology to digitize guest data. Another 57% state that they wish to digitize the check-in/out process.  

Digitizing these processes is crucial to ensure your hotel can meet customer expectations. Moreover, the different departments in your hotel can achieve better results when they combine efforts. All these issues are easy to tackle once you integrate your hotel operations into a centralized system.  

Let’s delve into the different departments in a hotel and the tools that can help transform them.  

Teams in the hospitality industry and their functions 

Integrated teams for hospitality

1) Front Office   

The front desk, which has direct interaction with visitors, is a crucial facet of any hotel.  Generally, this division is accessible at the hotel’s main entrance. Since it is immediately visible to guests, customers, and visitors, it is the first physical touchpoint. This department’s primary duties are: 

  • Guest service 
  • Check-in and check-out
  • Accounting & processing payments
  • Foreign exchange
  • Room reservations
  • And inquiries

The front desk is the best area to cross-sell, upsell and create meaningful connections with guests.  

2) Marketing and Sales 

The hospitality business has key divisions for marketing and sales. Your hotel’s success greatly depends on the success of these two teams. Both teams need to work in tandem for your business to succeed.   

Maximizing a hotel’s revenue is the responsibility of the marketing and sales team. They accomplish this by creating company initiatives to boost revenue. Their primary duties are: 

  • Lead generation  
  • Loyalty program implementation 
  • Communicate with staff members to gain information about guests 
  • Plan brand efforts and ad campaigns 
  • Communications and PR 
  • E-commerce operations 
  • Build client relationships 
  • Conduct market research 

The marketing and sales team increases profitability and helps you build brand awareness.  

3) Financial team   

A hotel’s financial department is in charge of two major tasks- 

  • Keeping tabs on operating expenses
  • And ensuring that revenue is sustainable 

This department is in charge of organizing, monitoring, and implementing a hotel’s financial plans. Some of their key responsibilities are: 

  • Financial accounting
  • Revenue tracking
  • Budget forecasting
  • Cost accounting
  • Tax accounting
  • And auditing and managerial accounting

4) Housekeeping staff 

The main duty of the housekeeping staff is to maintain the cleanliness and sanitization of any space. Some of their duties are: 

  • Making beds and replacing old bedding
  • Collection and disposal of waste 
  • They ensure that toiletries and supplies are available in guest rooms
  • Polish and dust furniture 
  • Clean and sanitize hotel rooms 

The housekeeping personnel is responsible for operations that ensure a comfortable stay for the hotel guests. They are the backbone of a hotel as they are responsible for manual labor.  

These teams are all responsible for a hotel’s success. But they can also be the reason for its inefficiencies if they don’t have the right tools. So what are some tools that can help them complete tasks effectively?  

Tools that can help boost their performance by integrating 

1) hotel property management system (pms) .

A system that enables a hotel to handle front-office capabilities is what we call a hotel property management system. It offers a centralized computer system that empowers the organization. The key objectives of a PMS solution are the following:  

  • The automation of routine front-office and administrative duties, 
  • Scheduling and executing daily reports 
  • Housekeeping and reservations information 

Newer hotel PMS solutions also come with a number of capabilities that support customized, tailored guest experiences. A hotel’s front desk staff is empowered by a mobile-enabled cloud hotel PMS to:  

  • Check guests in and out
  • Assign rooms
  • Provide guest services without physically contacting or meeting guests

StayNTouch Cloud PMS is an excellent solution for hoteliers searching for front desk-specific software.  

2) Hotel Revenue Management System (RMS) 

A revenue management system is a software that helps you figure out your hotel pricing structure. It collects hotel-specific and industry-average data to configure the exact rates you must offer.  

With the help of an RMS, you can execute revenue-related decisions in a centralized dashboard. Some of its best features are: 

  • Forecast pricing rates 
  • Real-time pricing and open pricing 
  • Reports and analytics on ADR, revenue, and competitors 

RMS assists hotels in turning a profit by carefully monitoring market demand. Moreover, they create prices that help hotels remain profitable while remaining competitive. 

One such revenue management system is IDeaS Revenue Solutions . IDeaS offers an automated, machine-learning revenue engine to generate robust, analytically driven decisions. 

3) Hotel Customer Relationship Management (CRM) 

Building and maintaining successful relationships with customers is done through the process of customer relationship management . It is a program that encompasses all organizational divisions and staff members at all levels. A CRM aims to enhance client service and raise customer satisfaction.  

Most CRMs serve as comprehensive management systems for hotels. CRMs provide extensive features that enable users to establish meaningful connections with their visitors. Its main characteristics are: 

  • Automated lead generation and distribution  
  • Tracking and recording of conversations and patrons 
  • Captures booking inquiries 
  • Creating client profiles and lead segmentation  
  • Automation of tasks in the sales and marketing departments 

Essentially a CRM helps users integrate all operations into a centralized system. For instance, LeadSquared is one such one-stop solution to integrate various tasks, features of which are: 

  • Marketing and sales automation  
  • Front desk operations 
  • Personalized guest experiences 
  • Revenue management 

4) Hotel Point of Sale System (POS) 

Retail establishments, dining establishments, and hotels all frequently employ POS systems. In hotels, POS systems enable the collection of customer orders and purchases from several points of sale.  

For instance, imagine the following situation: 

  • A customer decides to eat breakfast at your establishment.  
  • After this, they book a session at the spa.  
  • They finish the day off by enjoying a drink at the rooftop bar.  

They don’t have to pay for each of these items immediately when there is a POS in place. A POS’s primary hardware features are: 

The most common POS hardware components include: 

  • QR code scanner 
  • POS terminal display  
  • Credit/debit card reader 
  • Receipt printer 

Its primary functions are: 

  • Payment processing 
  • Reports and records of transactions 
  • Employee management 
  • Inventory management 

POS systems are hard to choose from as most solutions cater to retailers or restaurants. Toast is a restaurant-specific POS solution you can also implement in your hotel. Their core offerings are: 

  • Inventory tracking and notifications 
  • End of the day reports 
  • Sales tracking  

Let’s see how you can effectively optimize each team’s tasks with the help of these tools! 

Ways to optimize and streamline hotel operations 

1) collect guest feedback and testimonials .

The hospitality industry depends on customer feedback more than any other sector. The entire experience revolves around serving a guest and tending to their needs.  

Positive guest feedback and testimonials can be powerful drivers of revenue. For instance, two out of three people state that video testimonials make them more inclined to buy a product or service. So how can you collect feedback from guests? 

  • Once your guest’s stay ends, send them an email asking them to give feedback about their experience. A CRM that automates your email marketing efforts is an ideal tool in this scenario.  
  • Keep the survey simple. You can always throw in some open-ended questions for detailed reviews. But the language and wording you use should be readable and easy to understand.  
  • Implement a feedback collection system to ensure you don’t miss out on reviews. If you handle several guests daily and wish to access their feedback in an organized manner, a CRM is an ideal tool.   
  • Lastly, an easy way to get feedback is to interact with them. At the end of every guest’s stay, a front desk agent or customer service rep can ask them about their stay. Utilize software that records and tracks these conversations for future reference. Some questions they could ask are: 
  • How was your stay? 
  • Do let us know if you have any requests or changes we should make for future visits.
  • How did you book your room?  
  • What can we do to enhance your experience? 
  • How were the staff?  

Customer feedback is essential to the growth of your hotel. So ensure that you obtain feedback and testimonials from every guest at your stay. 

2) Integrate all teams and centralize data 

All industries today utilize big data for better customer service. Having unified data at your hotel can aid in obtaining such insights. Additionally, integrating your processes is crucial to avoid any mishaps in the exchange of guest information.  

It is easy to keep track of all check-ins, check-outs, and front desk activities through the hotel PMS. You can monitor your financial health and growth with the aid of an RMS. Finally, a POS provides a great level of convenience for your visitors.  

However, a CRM is vital to help you integrate these processes into a unified platform. For example, you could integrate your digital sources of revenue (social media, third-party websites, and more). Your revenue and management team can then gather inquiries and deliver them to your sales staff.  

The sales team can follow up on active leads and give their information to the marketing team. The marketing department can then promote your hotel to relevant users when they are online. You need software that integrates all these operations in a single centralized location.  

For example, GCC Hotels partnered with LeadSquared to integrate all their sales teams and lead sources into one system. The integration of these tasks led to a 50% increase in bookings at GCC Hotels. Data is essential to your hotel’s success, but you need to integrate your operations to fully experience its benefits.  

3) Personalize guest experiences 

Customer profiling or finding your ideal customer persona is a must in current times. Excellent customer service is at the core of most successful businesses. Studies show that: 

  • Customers are ready to spend a premium of up to 13% and as much as 18% for better experiences.   
  • Two-thirds of consumers are happy to give brands their personal information in exchange for better value.  

Using a tool that helps you figure out your ideal customer can help you personalize their stay. Guests don’t mind parting with personal details if it means that their stay will improve.  

You must install a tool that helps you segment leads based on your chosen criteria. You can reach out to prospective guests faster and identify their needs. Steps you can take to personalize guest experiences: 

  • Build customer profiles or personas
  • Use email automation to send arrival and post-stay emails that boost retention 
  • Offer upgrades and add-ons when you better know their likes and interests
  • Digitize check-in and check-out processes. But also offer in-person options for those interested

4) Empower employees with helpful tools 

Centralizing data is the first step you can take towards better equipping your staff. Beyond data centralization lie tools that boost employee productivity and performance.  

Each team can increase efficiency with the help of their correlating tools. But implementing each tool separately will cause data fragmentation over time. Data fragmentation is a bad sign in any company. But it can be particularly destructive in the hospitality industry.   

You must eliminate any inter-departmental silos and integrate all operations. Then each team will have all the information they need and their distinct tools to enhance performance.  

Lastly, managers too can use performance tracking tools to monitor staff productivity. These tools help managers reward high-performing teams or intervene in a timely manner if any employee is facing issues.   

Running a hotel can be daunting to anyone. But there are several innovations that help you overcome any challenges. Investing in the right technology, like LeadSquared CRM , can boost revenue, productivity, and customer satisfaction. So, book a demo with our team today to improve hotel operations and creating the best customer experience for your guests.  

Padma Ramakrishna

Padma is a Content Writer at Leadsquared. She enjoys reading and writing about various financial and educational topics. You can connect with her on LinkedIn or write to her at [email protected].

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Everything You Need To Know About Hotel Operations Management

Table of Contents

At a glance:

Understanding Hotel Operations Management

Key components of hotel operations management, challenges in hotel operations management, powerful strategies for effective hotel operations management, about innquest.

Effective hotel operations management is crucial for orchestrating a flawless guest experience in the fast-paced hospitality sector. This intricate process encompasses a plethora of components that intertwine to create a symphony of hospitality. From the moment a guest walks through the doors until their departure, every aspect of their stay is carefully curated through the lenses of hotel operating systems and the adept oversight of a hotel operations manager. Navigating this intricate process demands a keen understanding of both the art and science behind exceptional guest service.

Hotel operations management involves overseeing and coordinating all activities within a hotel to ensure its efficient and profitable functioning. It encompasses tasks such as front office operations, housekeeping, food and beverage services, maintenance, sales, marketing and financial management. The goal is to provide excellent guest experiences while maximizing revenue and maintaining cost control. Effective hotel operations management is vital for a hotel’s success, reputation and long-term sustainability in the competitive hospitality industry.

Hotel operations management comprises several key components that work together to ensure the smooth and efficient functioning of a hotel. These components are integral to providing a positive guest experience and achieving financial success:

  • Front Office Operations: The front office is the face of the hotel. It handles guest reservations, check-in/check-out processes, and room assignments and provides concierge services. Efficient front office operations are crucial for guest satisfaction as they set the initial impression.
  • Housekeeping: Housekeeping is responsible for maintaining the cleanliness and orderliness of guest rooms, public areas, and back-of-house spaces. Clean and well-maintained rooms are essential for guest comfort and safety.
  • Food and Beverage Services: This department manages all dining and catering services within the hotel, including restaurants, room service, banquets, and bars. High-quality food and beverage services enhance the overall guest experience and can be a significant revenue generator.
  • Maintenance: The maintenance department ensures that all hotel facilities and equipment are in good working condition. Preventive maintenance schedules and swift repairs are essential to prevent service disruptions and ensure guest safety.
  • Sales and Marketing: Effective sales and marketing efforts are critical for attracting guests and maximizing revenue. This includes advertising, promotions, pricing strategies and partnerships with travel agencies and online booking platforms.
  • Human Resource Management: Managing the hotel’s workforce is essential. This involves recruiting, training, and retaining qualified staff, creating a positive work culture and offering opportunities for career growth.
  • Technology Integration: Staying updated with technological advancements is crucial. This includes property management systems (PMS), online booking platforms , customer relationship management (CRM) tools and energy management systems to streamline operations and enhance guest experiences.
  • Financial Management: Effective financial management involves budgeting, revenue tracking, cost control and financial reporting. Revenue optimization tools ensure the hotel remains financially viable and can invest in improvements and expansions. These components collectively form the foundation of hotel operations management. Successful management in each of these areas contributes to a positive guest experience, a strong brand reputation and the hotel’s overall profitability and sustainability in a competitive industry.

Hotel operations management is a complex field with several challenges. Some of these include:

  • Staff Training and Turnover: One of the most significant challenges in hotel operations management is recruiting and retaining skilled and motivated staff. The hospitality industry often experiences high turnover rates due to factors such as long hours, demanding guests, and seasonal fluctuations in demand. Constantly training new employees can be costly and impact service quality. Effective human resource management strategies, such as competitive wages, employee benefits, training programs and career growth opportunities, are essential to address this challenge.
  • Technology Integration: Keeping up with rapidly evolving technology is another challenge in hotel operations management. Hotels need to integrate and utilize various software systems like property management system s (PMS), point-of-sale (POS) systems, customer relationship management (CRM) tools, and online booking platforms. Ensuring these systems work seamlessly together is essential for smooth operations. Additionally, providing guests with a tech-savvy and connected experience, such as mobile check-ins and keyless entry, is becoming increasingly important.
  • Seasonal Demand and Revenue Management: Many hotels face seasonal fluctuations in demand, with peak periods followed by slower periods. Effective revenue management is crucial to optimize room rates, occupancy levels, and overall revenue. Balancing the need to fill rooms during low seasons while maximizing profits during high seasons requires careful planning and dynamic pricing strategies. Failure to do this can result in lost revenue opportunities or overbooking during peak periods.
  • Guest Experience and Satisfaction: Last but not least, navigating guest expectations and addressing concerns is a delicate process in the realm of hotel operations management. Effective communication and resolution strategies are pivotal. By actively managing and exceeding guest expectations, operations managers maintain the melody of guest satisfaction. When a problem is resolved swiftly, visitors are 40% more inclined to post favorable evaluations and reviews.  Swift response to feedback and a genuine desire to please resonate with guests, turning them into loyal advocates.

To learn more about the power of online reviews for hotels, read this .

Hotel operations management is a multifaceted discipline that requires a combination of effective strategies to ensure smooth operations, exceptional guest experiences and financial success. Here are some powerful strategies to enhance hotel operations management:

  • Guest-Centric Approach: Put guest satisfaction at the forefront of your operations. Train your staff to prioritize guest needs and provide exceptional service. Encourage a culture of empathy and responsiveness to guest feedback and concerns. Personalize guest experiences by remembering their preferences and anticipating their needs.
  • Efficient Staff Management: Invest in your employees by providing comprehensive training programs and opportunities for career advancement. Clearly define job roles and responsibilities, and foster a positive work environment that promotes teamwork and employee well-being. Happy and motivated staff are more likely to deliver exceptional service.
  • Quality Food and Beverage Services: Ensure that your hotel’s dining options meet high standards. Focus on the quality of ingredients, presentation and service in your restaurants, bars and room service. Offer diverse menus to cater to different tastes and dietary preferences. Consider partnering with local suppliers for fresh, unique offerings.
  • Dynamic Pricing and Revenue Management: Implement dynamic pricing strategies that consider factors like demand, seasonality, competitor rates and market conditions. Use revenue management systems and data analytics to optimize room rates, occupancy and revenue. Continuously monitor and adjust pricing strategies to maximize profitability.
  • Regular Maintenance and Upkeep: Implement a proactive maintenance schedule to ensure that all facilities and equipment are in good working order. Regularly inspect guest rooms, public areas and back-of-house spaces for wear and tear. Promptly address maintenance issues to prevent disruptions in guest services.
  • Effective Technology Integration: Embrace technology to streamline operations. Invest in a robust property management system (PMS) that integrates with other essential tools like point-of-sale (POS) systems, booking engine s and customer relationship management (CRM) software. Adopt cloud-based solutions for scalability and flexibility.
  • Energy Efficiency and Sustainability: Implement eco-friendly practices to reduce your environmental impact and appeal to environmentally conscious travelers. Invest in energy-efficient lighting, heating, and cooling systems. Reduce water consumption through low-flow fixtures. Source locally and sustainably when possible, and minimize waste through recycling and responsible disposal practices.
  • Safety and Security Measures: Prioritize the safety and security of guests and staff. Implement comprehensive safety protocols, including fire safety measures and emergency response plans. Use modern security technology such as surveillance cameras and access control systems. Train staff in emergency procedures and ensure clear communication channels in case of incidents.
  • Data-Driven Decision Making: Leverage data analytics to make informed decisions. Analyze guest preferences, booking patterns and spending behaviors to tailor marketing efforts and improve guest experiences. Monitor key performance indicators (KPIs) such as occupancy rates, revenue per available room (RevPAR) and guest satisfaction scores to track your hotel’s performance.
  • Community Engagement and Partnerships: Build relationships with local businesses and organizations to enhance the guest experience. Collaborate with local tour operators, restaurants, and attractions to offer exclusive packages and experiences. Engage in community events and initiatives to create a positive image for your hotel. To learn how AI is revolutionizing the hospitality industry, read this .

As the hospitality industry continues to evolve, the role of an operations manager remains vital in maintaining the harmonious balance that transforms a mere stay into unforgettable memories. By adopting powerful hotel operation management strategies and continuously adapting to changing market dynamics and guest expectations, hotels can achieve long-term success and maintain a competitive edge in the hospitality industry.

At InnQuest , we understand the importance of the challenges faced by businesses in the hospitality industry. Our goal is not only to help manage your businesses more efficiently but also to provide ongoing support to engender growth and expansion. Book a demonstration of our award-winning hotel management software here .

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Hospitality industry makes a strong comeback, but face key challenges

EY Americas Real Estate, Hospitality & Construction Consulting Leader

Transformation agent. Innovative thinker. Real estate and hospitality professional . Leveraging technology to drive transformation.

Hospitality industry CFOs surveyed share that leisure travel continues to grow while business travel shows slower rebound.

  • While revenue per available room (RevPAR) recovery is exceeding expectations, labor shortages are still creating challenges for hotels.
  • The hospitality industry is adapting to meet challenges by  adjusting amenities, outsourcing more and increasing reliance on technology. 

A ccording to a survey of 20 hospitality industry CFOs, vacations dominate hotel bookings, as companies continue to pull back on business trips. However, corporate travel demand is returning as well, even if at a slower pace. 

The boom in leisure travel is consistent with the EY 2022 Hospitality Consumer Survey , which found that 89% of respondents planned to take at least one leisure trip in 2022, and 24% intended to take three or more trips for recreation. 

Hotel recovery beats expectations

The EY 2022 Hospitality CFO Survey gleaned responses from CFOs at 20 leading travel and hospitality companies. When the pandemic hit in early 2020, the entire hotel industry basically shut down. Analysts predicted it could be 2023 or even 2024 before RevPAR would return to pre-pandemic levels. However, 16 of the 20 leading CFOs surveyed believe the industry will reach that benchmark by spring 2023. Nine of those CFOs are even more optimistic, predicting a return to 2019 levels by the end of 2022. 

Business travel still lagging

The EY CFO survey revealed a deep lack of confidence in the ability of business travel to aid RevPAR recovery. While 16 out of 20 CFOs said leisure travel would be the No. 1 factor in this effort, only two cited business travel and two others indicated group travel to lead the way. When asked for specific matters that are having a negative impact on RevPAR, respondents cited recession fears, a slowing economy, geopolitical concerns, companies cutting back on discretionary spending and air travel delays. This reduction in business travel has led to large conventions either not happening or being scaled back significantly from past events. 

Seven out of 20 CFOs surveyed ranked group travel as their third biggest concern, potentially having a negative impact on RevPAR recovery. It stands to reason that as confidence grows with leisure travelers, there will also be an impact on people traveling to weddings, conventions and other group excursions.

How EY can help

Hospitality services.

EY advises clients on the full suite of hospitality and tourism services — from digital operational innovations to strategy and transaction consulting. Our Hospitality Service professionals can provide insights to help your Hospitality organization reach its strategic goals.

Long-term concerns temper industry optimism

One of the biggest issues facing hotels right now is labor shortages. Twelve of the 20 CFOs in the EY survey cited this challenge as causing the most strain on hotel net operating income (NOI). More than half of the respondents in the survey said they are adjusting amenities to customers and outsourcing various functions to try to reduce costs. Hotels are also raising pay to attract talent, with 17 out of 20 CFOs surveyed claiming they plan to do this. More than half of the respondents are also relying on technology more than before to get things done and create more efficiencies. 

While consumers confront higher average daily rates (ADRs) and even fewer amenities that now come at a price, there still seems to be a steadily growing pent-up demand for travel.

Deal market in hospitality sector remains active

On the transaction market, 13 CFOs in the survey said they expect 2022 deal activity to come out below pre-pandemic levels, and only four expect a return to pre-COVID levels. When asked to name the top three factors that would drive hotel transaction volume in 2022, 10 CFOs said interest rates would have the biggest influence on deal activity. In addition to making deals more expensive, rising interest rates could also boost pricing expectations for sellers, potentially putting deals out of reach for prospective buyers.

Hotel transaction activity is still forecasted to trend positively, and values are continuing to rebound. There is still a high level of interest in pursuing deals as the industry continues to bounce back and perform well. It’s worth noting, however, that transactions have slowed and could continue to slow in the coming months because of inflationary impacts and the rising cost of debt due to interest rate increases.

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The EY Capital Projects Consulting team helps our clients reduce risk, increase efficiency and lower cost.  

The hotel industry has been nimble in reacting to outside pressures to get its financial performance back on track. But more challenges lie ahead, and the industry will need even more creativity to continue its recovery. The data from the CFO survey supports our findings in the consumer survey as part of our CxO survey series examining the perspective of C-level executives. The consumer survey showed that 89% of people said they were planning to take at least one trip, with 50% planning business travel.

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How to achieve operational excellence in hospitality

Alongside serving great food, the most successful restaurants are built on two key principles: operational excellence and exceptional customer service.

Michael radley.

What is operational excellence?

Operational excellence is the commitment to maintaining the highest standards across your brand. It’s the dedication to continuously innovate processes, services and products. And it’s about creating a culture that empowers employees to consistently deliver exceptional customer service.

Why is operational excellence important?

  • Improves customer loyalty: high levels of consistency mean customers know what to expect every time they visit, which leads to brand loyalty.
  • Reduces costly mistakes: putting the right systems in place, enables employees to get it right every time. This saves time, resources and ultimately boosts your bottom line. Discover how much time you could save with our savings calculator.
  • Enhances customer experience : better processes save employees time so they can focus on activities that drive value, like delivering excellent customer service.
  • Increases agility: businesses that encourage a culture of continuous improvement can stay ahead of the competition by adapting quickly to changing consumer and market demands.
  • Boosts productivity : teams are empowered and know how to do their job well. They have the tools to support them which improves motivation, job satisfaction and boosts performance... and your customers will notice it.
  • Hygiene rating of 5: control and visibility over your operations means your business is always prepared when an EHO arrives.

Trail provides the framework for operational excellence. And helps teams focus on the work that matters. Discover the right solution for your business and supercharge your operations .

Trail guides teams through their day, from daily checks to seasonal menu changes, ensuring everyone hits the same high standard . Discover a solution for your business.

Five businesses achieving operational excellence

Below are five of the best hospitality businesses out there—not only are they well oiled machines, but they go above and beyond to create unique customer experiences.

Artisan bakery brand Gails pride themselves on their high levels of consistency. You can walk into any store, in any city, at any time and know you’ll get the same excellent experience every time. Digital checklists underpin their operations removing admin, paperwork, and consequently, any mistakes. By building the right daily habits they give team members more time to focus on customer experience.

Contemporary British Restaurant chain Bills use visibility across their sites to fine tune their operational performance . They found that one-off audits couldn’t give them the real-time visibility they needed to maintain their high standards . Switching to digital checklists let Managers and HQ know exactly what was happening across all of their branches. This helps them focus their attention where it’s needed most.

New World Trading Company 

Multi award-winning New World Trading Company empowers team members at site level. They have created a culture of autonomy across seven brands and hundreds of staff. The leaders set a clear framework for their teams, provide the right tools, and then get out the way so staff could do their best work. This allowed them to make their name as one of the most unique brands in hospitality, and named in the Times Top 100 as one of the Best Places to Work, 2 years running.

High street dessert brand Creams Cafe maintain their operational excellence through good communication between head office and teams. They recently digitised their operations so they can instantly and seamlessly cascade information from head office to staff on the ground. Teams always know what to do, exactly how and when to do it. This has has enabled them to adapt fast, scale, and open new sites, even during the covid pandemic.

Pioneering brand Wagamama believe in Kaizen , the Japanese philosophy of continuous improvement. As part of their commitment to continually improve, they are always looking at how they can upgrade their processes for better results. Previously, health and safety was managed with a 90-page logbook, they saw this an opportunity to digitise for better efficiency. Now, data is stored securely on hospitality checklist app, Trail. This streamlines the working day and makes it easier for teams to get things right every time.

Switch to Trail and join the UK's best brands.

How to achieve operational excellence

There's no exact formula for operational excellence, it will look different for every business. But there are some easy steps you can follow to achieve the best standard of operational excellence possible:

  • Create great products – creating something that your customers want and will keep coming back for should be at the very core of your brand.
  • Create unique customer experiences – be intentional about customer service, ask yourself "what standards can I put in place that will help me to create a memorable experience and ensure customers return?"
  • Foster communication between teams – have a system in place that allows you to communicate efficiently and accurately from head office to teams on the ground. And that allows head office to see what has been actioned.
  • Make sure your teams are happy – empower employees with the tools they need to succeed in their job. Ruthlessly simplify processes and reduce noise at site level so employees can focus and be productive.
  • Seek consistency – get complete visibility over your operations and site performance so you can identify quickly if brand standards are slipping. This will allow you to allocate time and resources where they’re needed most.
  • Prioritise safety – make compliance a habit by building health and safety tasks into your team's working day.
  • Create a culture of continuous improvement – share your vision of innovation and establish the right system of behaviours to drive it.
  • Create good team habits – build better, more consistent habits into the workplace to help employees make better decisions without needing to ask permission.

How Trail can help

Throughout the day, Trail’s smart checklists tell the right person what to do at the right time, forming the right daily habits. From opening checks to cashing up Trail provides the framework for operational excellence.

Teams are empowered to do their work efficiently; managers are freed up from chasing and can focus on coaching teams to provide better customer experience.

Real-time insights and dashboards show managers which teams need help the most so you can focus your attention where it’s needed.

Continual improvement is made easy with clear communication from HQ to teams on the ground.

Deliver consistently great standards with Trail.

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How to Improve Hotel Operations in 7 Steps

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Since early 2020, hoteliers and other hospitality industry professionals have been navigating an ever-evolving obstacle course littered with unexpected changes and new challenges. Facing both a shortage of available labor as well as an oversaturated and highly-competitive marketplace, many industry professionals are looking to learn how to improve hotel operations while driving revenue back into their business.

In this blog post, we help hoteliers, sales managers, and other hospitality professionals learn how to improve hotel operations by exploring proven tactics and strategies. From using technology to automate processes to implementing effective team management strategies and hiring practices, the goal of this post is to send you on your way with at least one — if not seven — new ways to improve operations at your property. 

Discover how to improve hotel operations with these 7 tips

1. combat labor shortages with thoughtful hiring practices..

You can start just about anywhere when learning how to improve hotel operations, but to kick off our list, we assess the hotel labor shortage and discuss tactics hoteliers can use to combat the industry-wide issue. While a variety of industries have returned to or exceeded pre-pandemic employment levels, the hospitality and tourism industries are still struggling to fill open roles.

Commenting on the Bureau of Labor Statistics’ March 2022 employment report, Tori Emerson Barnes, Executive VP of Public Affairs and Policy for the U.S. Travel Association, explained the situation in more detail. "Despite this month’s employment gains, growth in the Leisure & Hospitality sector is far too slow to make up for more than two years of pandemic-related losses. A lack of available workers, coupled with the slow return of business and international travel spending, is restricting Leisure & Hospitality’s recovery, even as other sectors of the economy regain — and in some cases, exceed — pre-pandemic levels."

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One solution? Identify individuals who have a passion for hospitality by developing a thoughtful hiring process. Create honest and comprehensive job descriptions that:

  • Clearly detail the duties of the position
  • Outline available shifts/schedules
  • Include wage expectations
  • Showcase benefits (retirement, PTO, profit-sharing, insurance coverage, etc.)
  • Highlight hotel culture and work-life balance

When hiring hotel staff , provide candidates with a clear and transparent description of the job and conduct a variety of pre-hiring activities with applicants (interviews, screenings, background checks, etc.). By fully vetting candidates and ensuring they have a complete understanding of the position, hotels can work to reduce turnover rates and build a team of satisfied employees.

2. Invest in your team.

Create an environment in which people want to work by investing in your employees. Competitive wages, paid time off, health insurance, and a strong work-life balance are key factors modern workers are seeking in employment opportunities.  eHotelier Enterprise reports that satisfied hotel employees are 31% more productive and can increase a hotel’s profits by 12% on average. In addition, employees that feel supported are more likely to share honest feedback with management, helping the hotel improve in ways they may not have otherwise realized needed improvement.

Identify which areas, policies, procedures, or departments are most in need of improvement at your property, and develop a thoughtfully tailored strategy to improve hotel operations. Work with managers, leaders, and other support staff to revitalize hotel day-to-day operations. Touch base with hotel staff and check in with guests regularly to see what’s working, what’s not, and what you can do to continually learn how to improve hotel operations.

3. Simplify room block management.

Most hotel sales managers have jam-packed schedules, and managing group room blocks can end up eating up large parts of the day. But don’t let room block management be more than it needs to be. Using an automated room block management system can improve a hotel’s operational efficiency by eliminating tedious data entry, syncing real-time updates to the hotel’s CRS, PMS, and RMS, and reducing the risk of human error.

Save time and boost efficiency by implementing a centralized room block management and upsell system, such as Cvent Passkey , to streamline and automate group bookings at your hotel. 

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4. Offer cross-training opportunities and promote growth.

Empower hotel employees by encouraging and promoting cross-training opportunities. Not only will employees be able to explore a variety of positions and skills that interest them, but managers will also be able to see how teammates respond to new challenges and work with others. You may even uncover some hidden skillsets. For example, you may have an employee working in a back-of-house position with a penchant for sales right now and not even know it. Ensuring that employees are assigned to the most appropriate position based on their unique strengths is key to improving hotel operations.

Furthermore, invest in your staff by using your connections to help diligent workers move up the ladder. Support and encourage employees who have an interest in growing their career in hospitality, tourism, hotels, restaurants, or even unrelated industries.

5. Market, sell, and execute successful events.

Planners remotely sourcing and executing meetings need information quickly and efficiently. In fact, some planners now expect items like floorplans and diagrams to be part of the sales process. Meet planners' needs with engaging event diagramming software  that gives them the ability to visualize their event at your hotel before they ever set foot on the property.

Create interactive floorplans that show planners the unique value of your event space and what your hotel brings to the table. Add diagramming tools to your hotel listing that allow planners to instantly view different event areas and layout options, or take a 3D tour of your property. 

In addition to improving the way a hotel sells event space, interactive and automated event tools help improve efficiency and accuracy amongst hotel staff. With Cvent Event Diagramming, you can invite planners, teammates, and other stakeholders to watch and comment live as you make changes to a diagram they can see from anywhere in the world. 

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Bring your event space to life

6. Reduce chargebacks and no-shows.

Chargebacks and payment disputes can cost hotels millions of dollars and endless hours of corrective work each year. Hotel chargebacks may be the result of disputed no-show charges, dissatisfied guests, or even billing errors.

Reduce the risk of chargebacks and minimize resulting hotel loses by:

  • Looking for pre-arrival fraud indicators.
  • Using a reliable imprint machine or electronic card reader.
  • Clearly defining guest payment, cancellation, and no-show policies.
  • Including attrition and no-show clauses in group and event contracts.
  • Encouraging groups to manage their own reservations.
  • Sending cancellation and cut-off date reminders.
  • Reducing guest complaints through service-focused employee training.

Reducing the risk of guest disputes and credit card chargebacks can improve hotel operations, boost efficiency levels, and minimize profit loses.

7. Utilize digital hotel tools and mobile technology.

Increase the efficiency of front desk operations and prevent long lines in the lobby by adopting digital check-in services. Offer an app for no-contact mobile check-in that allows guests to use their mobile device as a digital room key. Short-staffed hotels can install a digital concierge in the lobby to assist with check-in procedures, answer guest questions, and improve the overall guest experience.

In addition to streamlining front desk procedures, hotels can use various forms of digital tools to improve day-to-day hotel operations. A wide variety of digital tools are available to hoteliers, including:  

  • Digital messaging systems that log staff tasks, send alerts, and set reminders.
  • In-room digital guest tablets that communicate room service orders, guest preferences, or housekeeping requests.
  • Hotel digital signage can communicate vital information or updates.

Digital tools can have a substantial impact on improving hotel operations in high-demand travel areas and can lend a hand to short-staffed hotels. While mobile tools will never replace the value of an employee, they can be used to drive revenue, optimize operational efficiency, eliminate excess expenses, and help prevent staff burnout.

At-property operations directors: This is for you

Above-property operations executives: This is for you

Start outperforming the competition and improve hotel operations today!

Now that you have some tools, resources, and strategies needed to improve the way your hotel operates, it’s time to put your new skills to the test. Create exciting innovative marketing campaigns advertising property changes, new booking opportunities, exclusive offers, and key hotel features. Not sure where to start? Check out our post on hotel marketing strategy  for 12 essentials to help you succeed.

Headshot of Cvent writer Kimberly Campbell

Kim Campbell

Kim is a full-time copy and content writer with many years of experience in the hospitality industry. She entered the hotel world in 2013 as a housekeeping team member and worked her way through various departments before being appointed to Director of Sales. Kim has championed numerous successful sales efforts, revenue strategies, and marketing campaigns — all of which landed her a spot on Hotel Management Magazine’s “Thirty Under 30” list.

Don’t be fooled though; she’s not all business! An avid forest forager, post-apocalyptic fiction fan, and free-sample-fiend, Kim prides herself on being well-rounded.

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7 Key Operational Areas Of Hotel Management

7 Key Operational Areas Of Hotel Management

Hotel Operations

A hotel operation wouldn’t run smoothly without the right people and right resources in the right departments. If you’re new to the hotel business , or just doing your fair share of basic research, read below for the outline of a hotel’s structure.

Your exact needs may not be the same as other hotels. The size of your establishment, whether you offer full service or not, and what amenities you have will change your needs.

But most hotels have the following seven areas in common. These areas reflect the various job roles to be filled to keep the organization running. Being aware of these departments can help you plan for future success.

These are the decision-makers within the business . They may be department heads, managers, or directors .

Depending on how your company runs and its size, executives may be responsible for some of the other areas discussed below, including accounting, marketing , and even front desk services.

Front Desk Services

Although no operating segment within a hotel operation is dispensable, very little would happen without the front office staff.

These people are constantly in contact with guests  and may even be responsible for taking and handling bookings. Detail-oriented people are often required for this role since they must meet the exact needs of the guests.

Sometimes concierge may also be lumped in with this business division but could be an entirely different department worth building.

Housekeeping

Keeping your guest rooms clean and tidy is an essential task. Your housekeeping team is typically responsible for every detail within a room, from the cleanliness of the sheets to maintaining toiletries stocked. 

Your guests may forget many things, but a clean room will remain in their minds. That's how you can create loyal customers and positive online reviews. Online review for the hospitality industry is vital. Invest in housekeeping to earn more of them.

Maintenance

Even the best quality utilities and electronics can break and malfunction. There is also more to repair and fix in today’s tech-oriented world in terms of computers, TV screens, game consoles, DVD players, and other cutting-edge tech items than before.

Tech can sometimes also be the responsibility of executives or front desk services, depending on what works best for the organization.

Additionally, in some cases, maintenance might be lumped in with housekeeping or another role. But, again, it depends on the size of your business and the personnel available to you.

Every business needs proper accounting. Tracking expenses and revenue helps you keep a finger on the pulse of the business, and you can make tweaks and adjustments as necessary.

The accounting team is usually directly answerable to the executive team, providing them with relevant data and forecasts. They may also make recommendations and offer support for other departments.

Marketing & Sales

Every business requires promotion. The marketing team is responsible for converting prospects into paying guests and spreading the brand message. Therefore, they must keep up-to-date with the latest marketing channels and practices, including social media, content marketing, OTAs, and so on.

Marketing can sometimes become the responsibility of front desk services. But because executives often want control over the exact message shared with their target audience, they will sometimes take it on – especially if they don’t have a pre-existing marketing department. Plus, to entrepreneurs, business development is often the most exciting part.

Kitchen Staff

If you’re a full-service hotel, if you offer room services or both, then it’s impossible to keep up with orders and meet your guest’s dining needs without competent kitchen staff. Some hotels also need a separate catering team, especially for conference rooms .

Conclusion About Hotel Operations

Now you are aware of the different areas of hotel operation you need to be thinking about as you grow your business . Having the right structure in place is critical to the success of your organization overall.

Finding the right balance can be challenging because human resource is often the most expensive resource of all. At the same time, they are also your greatest resource, and you must cultivate and utilize them well.

We are a hotel marketing agency and manage your digital image including meta search advertising , web design, content creation, social media management, and more. Contact us to learn more and boost your hotel's goals.

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The operations plan describes your methods for meeting the goals you defined earlier. Everyday short-term processes are the individual tasks involved in booking reservations, checking in customers, cleaning and maintaining the hotel, handling luggage, settling accounts, and so forth. Long-term processes are the ways you will meet defined business goals, such as hitting a certain occupancy rate or adding a restaurant.

HOTEL BUSINESS PLAN OUTLINE

  • Hotel Business Plan Home
  • 1. Executive Summary
  • 2. Company Overview
  • 3. Industry Analysis
  • 4. Customer Analysis
  • 5. Competitive Analysis
  • 6. Marketing Plan
  • 7. Operations Plan
  • 8. Management Team
  • 9. Financial Plan
  • 10. Appendix
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The Future of Hospitality: 5 Realities Changing the Industry

Hotels, restaurants, and other hospitality businesses may be rebounding back to pre-pandemic norms—but that’s about the only thing returning to the status quo. Whether it’s new omnichannel approaches, better scenario planning, or embracing AI to address staffing challenges, hospitality leaders weigh in on what comes next—and how businesses can prepare.

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Though they’d be forgiven for taking some time to catch their breath—following the reinvention marathon the industry endured in recent years—hospitality leaders and their businesses aren’t slowing down. They’re busy experimenting with new service options and channels, planning ambitious future initiatives, and redefining hospitality for guests and employees alike.

Accelerating digital transformation unlocks operational scale and agility—and the ability to deliver engaging guest experiences. That’s key, considering that ongoing staffing challenges could otherwise hamper the industry’s ability to keep up with guest demand. 

Here, we examine five truths that hospitality leaders should embrace as they seek to create optimized, seamless, and satisfying experiences now and well into the future.

1. Experimentation Is Key to Meet Evolving Guest Demands

The hospitality industry is evolving at a rapid pace—even the concept of a restaurant has drastically changed in the past few years. The simple proposition of dine in or takeout has expanded to include curbside pickup, digital orders, third-party delivery apps, and “ghost kitchens” (food prepared for delivery or takeout), as restaurateurs pull multiple levers to satisfy customers and realize profits. 

This experimentation is set to continue as all hospitality operators strive to create sustainable models that meet guest expectations, seamlessly integrating physical and virtual services. Restaurants, for one, will need to adopt an omnichannel approach that blends dine-in and takeout experiences with varying price points to match. Think upscale in-person dining in the front of the restaurant with affordable delivery options out the back, or the continuing trend of ghost kitchens that evolve into virtual food halls.

To meet this demand, nearly a quarter of hospitality and travel operators are increasing their IT spending, according to data from market intelligence company IDC , with more than one-third planning to drive business objectives through innovation. 

“There’s definitely going to be a continued and accelerated adoption of different automation technologies both in the restaurant and in back-office and enterprise systems,” says Ken Duffy , principal at Deloitte. “We’re going to see more experimentation with different restaurant formats like smaller-footprint restaurants that are focusing just on off-premises dining, and we'll probably see some modifications to existing restaurants to alleviate some of the operational strains of all these different ordering channels.”

But experimenting doesn’t mean throwing darts. Taking smart risks requires analyzing reams of data to identify patterns and trends in guest behaviors. Operators need instant access to huge volumes of financial, workforce, and operational data to make faster, better-informed decisions amid changing market conditions. 

Unfortunately, some hospitality organizations’ inflexible, on-premise systems—which produce siloed, inconsistent data for operations, human capital management, and middle-office functions—make this near impossible. It’s not surprising, then, that hospitality leaders say digital automation, connecting front- and back-of-the-house systems, and harnessing the power of data are top priorities, according to Workday’s latest global CFO and CIO indicator survey .

“There’s definitely going to be a continued and accelerated adoption of different automation technologies both in the restaurant and in back-office and enterprise systems.” Ken Duffy Principal Deloitte

To experiment wisely, hospitality operators need to see the full picture of their people, operations, and finances in one place. Solutions that combine disparate data sources are key to providing this 360-degree visibility. Blended metrics pulling in granular details, such as point-of-sale checks, square footage, foot traffic, and channel, will help hospitality leaders answer complex operational questions and better anticipate where guest demand is headed. 

“Agility and being able to make data-driven decisions is going to define success,” says Rich Bye , vice president of human capital management and workforce product strategy at Workday. “Companies with full-stack integrations are able to speed their operational awareness and are more successful tracking their experiments with delivery, different methods of operations, and controlling labor costs.”

2. Scenario Planning Will Remain Synonymous With Success

In an industry that’s especially sensitive to disruption, a single plan just won’t cut it. 

Hospitality leaders “are absolutely building very detailed scenario plans to understand how to react to different market conditions and figure out what levers to pull, what initiatives to drive, depending on how the market plays out,” said Scott Rankin, KPMG’s advisory industry leader for consumer and retail, at Workday Rising this past fall.

To build powerful short- and long-term plans, hospitality operators will need a technology platform that empowers them to react to a range of possibilities.

“Operators are taking a much more strategic approach so they can react quicker and better, with stronger scenario planning and multiple back-up plans.” Eric Washer Vice President, Industry Product Strategy Workday

Many learned this lesson during the pandemic, when existing strategies went out the window. Amy Smith, senior vice president and CFO at Drury Hotels, notes that her company lost 80% of its revenue in one month during the pandemic, and at that point, the company had almost no ability to forecast effectively. 

This served as a wake-up call to replace its 20-year-old on-premise system with an integrated, cloud-based solution, including financial planning software. “That has transformed how our team interacts with the budget and forecast process,” Smith says. “[Today] we have an ability to set up everything as assumptions and then turn around and drive formulas for anything that’s variable on those assumptions.”

But across the industry, many organizations still grapple with spreadsheets and siloed data, struggling to execute efficient what-if scenarios on the impacts of labor shortages, rising prices, occupancy changes, and more. In fact, 70% of hospitality leaders say they have not yet developed a digital finance transformation strategy or are still in the process of developing one, a Workday survey found.

Going forward, hospitality leaders will take a more proactive stance by investing in technology that bridges the front and back offices—everything from inventory management and menu planning to cash-flow analysis and scenario planning—in one intuitive, trusted source.

“Operators are taking a much more strategic approach so they can react quicker and better, with stronger scenario planning and multiple back-up plans,” says Eric Washer , vice president, industry product strategy at Workday. “With everything going on in the world, we expect that organizations will only be looking further out, no longer content to have just one or two options for a certain supply or a certain region.”

3. Labor Challenges Spur Investments in Employee Experience  

Demand for travel and dining has roared back since the start of the pandemic, while at the same time the industry faces historic labor shortages. In 2022, hospitality’s labor force stood at just 84% of 2019 levels, while 46% of hospitality executives reported higher employee turnover than the historical average. The labor crunch isn’t just pay related, either: Hospitality frontline workers are seeking out a better work-life balance via entirely new careers.

“It’s been kind of a reinvention,” says Jude Reser , vice president of human resources at hotel and asset management company Atrium Hospitality. “People have decided that they would rather work 9 to 5, five days a week, and have some flexibility.”

“We have an ability to set up everything as assumptions and then turn around and drive formulas for anything that’s variable on those assumptions.” Amy Smith Senior Vice President and Chief Financial Officer Drury Hotels

According to a recent Workday study , frontline hospitality employees are also tired of feeling less valued than back-office workers. Only 34% of hospitality respondents say that they value frontline staff as much as office staff. 

Hospitality leaders will need to attract and retain frontline workers by giving them more control over their work lives and focusing on their development and wellbeing. One way is by offering more flexible scheduling options to compete with remote and hybrid jobs. They’ll also offer more visibility into additional opportunities available within the organization, so that workers can see a path forward that doesn’t require leaving for a better position elsewhere.

“It’s become quite evident that sensitivity to your workforce is more mission-critical than ever before,” notes Mark Cohen , director of retail studies at Columbia Business School. “People who run businesses need to have their frontline workers staff their business. But, if they’re not sensitive to their frontline workers as human beings, they may not have a large enough workforce to do business at all.” 

The enormity of the labor issue also requires careful use of data to track employee engagement. According to Workday research, 29% of organizations say an inability to quantify the value of an engaged frontline workforce or to gather the data necessary to do so are barriers to improving their frontline experience. 

One way businesses will address this issue is through technology. Tech will help hospitality organizations better understand the distinct needs, preferences, and goals of each worker. 

Machine learning (ML) will help personalize experiences so that employees can grow, be more productive, and feel more supported.

“It’s about asking, ‘How can I help you? How can I make a comfortable environment for you to work in?’” says David Morrell , a human resources leader and assistant professor at SUNY Empire State College. “You want to help the employee to be as satisfied, comfortable, and happy as they can be.”

4. ESG Emerges as a Growing Competitive Differentiator

Consumers and investors alike are paying more attention to hospitality companies’ environmental, social, and governance (ESG) practices, such as green accommodations and climate risk disclosures, and are adjusting their purchasing and investment behavior accordingly.

“Customers want to understand and feel confident that the products they’re buying and the operating model of an organization fit their values from an ESG perspective,” noted KPMG’s Rankin at Workday Rising. 

To meet these increased guest expectations, as well as regulatory requirements, hospitality companies will need to not only collect the correct data—from both internal and external sources—to properly track ESG initiatives, but also incorporate that data into core finance and human resources (HR) processes through a single platform. 

This creates what Stefan Ball, a senior solution marketing manager at Workday, calls “ a robust central repository ” for managing ESG performance, allowing operations, HR, and sustainability teams to work together to accomplish ESG goals. 

Hospitality companies’ finance teams , in particular, will be called to track information for ESG reporting and analyze how ESG objectives align with business performance. Empowered by cloud-based planning platforms that house financial metrics and ESG statistics in the same place, finance leaders can track ESG progress with integrated data from finance, operations, and other business units. This will help hospitality leaders immediately understand the ESG impact of business decisions and make adjustments as necessary. 

With the right commitments powered by the right technology, the industry can succeed in taking care of both its guests and the world at large. 

5. Hospitality Will Embrace AI and ML to Better Manage People and Operations

Not only do 70% of restaurant operators not have enough workers to support current demand, they also don’t expect a reprieve anytime soon. That’s a situation that extends across the industry—and one that leaders will need to address by investing in contactless capabilities and workflow automation across the employee life cycle, from recruiting and onboarding through offboarding. 

To augment the gaps in their human workforce, restaurants will increasingly leverage AI (artificial intelligence) for chatbots, personalized content on mobile apps, social media ordering, and administrative support. 

At Shake Shack, CIO Dave Harris says the organization automates processes wherever possible to reduce the time that managers spend on administrative tasks so they can spend more time with their teams and guests. 

Hotels, meanwhile, will depend on AI to improve personalized customer experiences and smart room service. While many guest-facing experiences are already conducted through autonomous channels, 50% of hospitality and travel operators by 2026 will fully automate tasks such as booking and staff interaction, personalized check-ins, maintenance, and occupancy and room optimization. 

Automation will also grow beyond more simplistic tasks. “I look at automation in two different buckets,” Deloitte principal Duffy says. “One is automating tasks, like automating flipping a burger. But then there’s also automation around decision-making, and that is where I think a lot of investment is going to be made over the next couple of years.”

The same data used by AI and ML to make operational decisions will also strengthen the hospitality industry’s skills-based approach to hiring, resulting in a workforce that’s better equipped to face future challenges. For example, AI and ML applications can speed up recruiting processes, scraping high volumes of resumes to highlight best-fit candidates for open roles. At Shake Shake, automated systems search for candidates with a growth mindset who are looking to develop new skills, rather than candidates with specific restaurant experience. Skills-based hiring will be a critical tool for the hospitality industry as leaders vie to attract workers from a smaller talent pool.

To learn more about how Workday can help your hospitality organization evolve, visit our website .

Our series dives deep into the business world’s most pertinent topics impacting the future of work, including artificial intelligence and machine learning, the employee experience, modern finance, and skills development. Discover content that helps you, as a business leader, get informed on opportunities and challenges you’ll face in 2023 and beyond.

You’ll hear from experts working to solve your critical issues—Workday executives, customers, partners, and other thought leaders. Read more in The Future Series .

We asked experts, government leaders, and big-picture thinkers what trends and issues will shape state and local governments over the next few years—and what you can do today to prepare.

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Best practices for efficient hotel management and operations

Best practices for efficient hotel management and operations

Location, the popularity of the destination, hotel facilities and luxurious packages – all of these contribute to the success of a hotel, but efficient hotel management and operations are aspects that surpass all of the above factors in making the hotel a successful one.

Whether it’s an international chain of hotels, a boutique resort, or serviced apartments, smart hotel management is equally critical for all and plays a significant role in the overall success of the property. Ability and skills of the hotel managers, their experience, knowledge and the way they supervise their staff is crucial in improving the perception of the hotel.

Successful hoteliers focus on the behind the scenes management and operation of their hotel , and this piece discusses which of these practices will help you win and retain your existing and potential guests.

Customer Relations:

Different surveys have predicted that by 2020, the key differentiator for brands will no longer be the price but the customer experience. In the last couple of years, more than 50% of global organizations have substantially changed their business models for the sake of improving customer experience . Hotels can’t disregard this area if they want to succeed in their industry.

Therefore, a key focus for hotel managers should be their guests; they should always strive to fulfill the guests’ needs and keenly review the feedback from them regardless of their positive or negative nature. In case of a dispute, we suggest managers extend their personal services to address the issue and utilize innovative ways to augment the guest experience.

We don’t believe that all this can be done from behind a desk either. Staff that make real life connections with their hotel guests are the more able to deliver the best possible guest experience. A hotel manager that can be seen walking around the hotel, greeting the guests, strolling in the lobby and communicating with their staff signals to guests that they are managing a smooth operation. And similar to the real-world, the managers should make their presence felt in the virtual world too.

Moreover, we suggest those in the management should stay abreast with the emerging hospitality technology trends and strategically employ them to build better customer relations. This can then be used to better train hotel staff in improving the experience of their guests.

Online Reputation Management:

The internet and social media are prevalent in this day and age, and so it is essential for the survival of organizations. The trend of weighing up online reviews before a final decision isn’t just limited to online shopping, but has impacted every business with the hotel industry being no exception.

According to a study , 77% of travelers appraise the reviews of previous visitors, families, and friends about the hotels on the booking websites before booking them. For that reason, branding and managing online reputation should be a priority of hoteliers nowadays. This includes monitoring their hotels online presence by regular posting, tracking reviews and by amicably responding to every negative review.

Filtering of reviews isn’t a positive practice, presenting just the positive reviews on websites and social media pages can actually make potential customers think that they are forged. So, the managers must stay away from such tactics in their effort to present a positive image of their hotels.

Hotel managers should know what platforms, discussion forums, and channels are mostly used by the travelers and hotel guests while taking a booking decision and they should be present there in order to answer their queries. By joining and engaging with the potential guests in their hotel-booking related conversations, hoteliers can build a positive reputation about their hotel.

Not only this, the speed in which queries are responded to is crucial as potential guests might be wondering about your hotel’s services and a delayed response may sway them to book an alternative.

Additionally, to engage the existing followers and to increase the followers' base, if possible, content managers should float regular offers, promos, and giveaways to create a buzz online.

Owning your hotels my business listing is one of the most important steps in protecting and claiming your business’s online profile, ensuring that your hotel appears on Google's sidebar for branded search results.

Flag the spam accounts, create your official accounts on all social media platforms and review sites and link them to the official website of the business to maintain control over the reviews of the hotel guests.

Staff Management:

Managers must display empathy not only towards their guests but also towards their staff members. There is a direct relationship between the staff and the guests; the more content a team of staff is, the more satisfied the guests will be.

Hotel employees aren’t dispensable resources, they hold paramount importance; they are the ones who have the most contact with guests. They are less likely to strive to greet their guests warmly if they themselves have always received a cold shoulder from their supervisors. Therefore, managers should extend support, compassion, and resources towards their employees, thus they will use those tools and resources to enhance the guests’ experience with the hotel brand. Disinterested staff behavior not only gives cold vibes to the visitors, but it can contribute to a higher staff turnover.

Hotel managers, therefore, must take steps to train the staff; they should identify and polish the specific skills of the employees, develop their skill sets, keep the motivation level high among the workers, and communicate with them to grasp their career goals and targets.

Regular communication with the employees will help in developing a close relationship between the hotel managers and staff and the managers will then be in a good position to listen and understand the staff’s problems and provide timely solutions. All these practices will eventually pay back in the form of a positive work environment and an increased loyal consumer base.

Adopt Innovative Technology:

When hotels think about offering technologies to their guests, often they only focus on free WiFi, but that’s not always enough these days. In the era of Artificial Intelligence, hotels should start focusing on adopting innovative technologies where possible to attract hotel guests and drive their business forward. This won’t only enhance the guests’ stay at the hotel but will also attract organizations and enterprises searching for hotels equipped with the latest technologies for their upcoming events and meetings.

Incorporating more advanced technology is not just to improve the guest experience, it can also be used to improve the operation of the hotel. By integrating technologies in their daily management of the business such as property management system or a technology suite designed specifically for the hotel industry; this can streamline different work process and ease the workload of the hotel staff.

To boost your room reservations and save time that’s spent on manual registrations and updates, a hotel manager could consider acquiring an updated PMS for a start. Often hotels do not update their booking systems often enough, which leads to errors and can waste time the more outdated they get. Executing cloud-based technologies in the management and training of employees will also increase the management and operations’ efficiency of the hotel.

Cloud based Property Management System (PMS) reduces the need of heavy hardware infrastructure thus reducing the equipment cost for the company, and make the training of much easier than traditional PMS solutions.

Adopting innovative technologies will lessen the workload of hotel managers and staff as they will conveniently manage the reservation desk, guests’ information, housekeeping, restaurant, banquet, accounting and several other management and operations’ task simply through their smartphones, tablets or other wireless devices.

Exceed Your Guests Expectations:

Good hotel management software is the one that goes above and beyond the elevated expectations of its guests. Hotel managers must always be looking for ways to raise the customer service experience and take that to the next level. A well-managed hotel will make visitors feel satisfied and pleased with their experience of the hotel. This won’t only increase their chances of re-visiting hotel on their next visit, but their recommendation will also increase the consumers’ base.

For this, hotel managers need to be vigilant and watch out for complimentary services and facilities offered by their competitors and then offer something different and unique for guests. Examples could include engaging guests with hosted themed social hours in the lobby or throwing a bonfire party or arranging a concert for which they can sign-up. Guests might then share their experiences on social media, to help attract more visitors and tourists.

Managing hotels requires a lot of effort, experience, skill, knowledge and patience, and a smart hotelier is the one who possesses all these abilities. Successful hotel managers are vigilant, anticipate problematic areas, predict consumers’ demands and tactfully handle all of these. They are open-minded and remain watchful of the emerging technologies and trends in their industry and effectively incorporate them into their hotel to provide the best possible experience for their guests.

This article was written by South Point Suites , the perfect hotel for short or long visits to London.

The Benefits of Nature-Centered Design in the Hospitality Industry

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Operational Planning for the Hospitality Industry - NMU Bulletin

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Operational Planning for the Hospitality Industry

  • Offered: Winter
  • Prerequisites: HM 449, or instructor permission.
  • Bulletin Year: 2023 - 2024 Undergraduate Bulletin

Utilize knowledge and skills acquired throughout the HM program experience, this course results in the culminating project development of an investment-ready business plan. Expanding upon necessary industry topics for final implementation, this course covers organizational effectiveness to ensure correct concept development, justification of market selection, projected financials, facilities design, staffing, procurement, and market-specific regulations.

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Below are eight issues that we expect to impact the hospitality industry in 2024.

1. Ransomware

According to Sophos’ " The State of Ransomware 2023 " report, ransomware affected two-thirds of all organizations in 2023. The effects can be devastating, with data — including sensitive trade secrets and personal data — being encrypted and held ransom for what can be a large payment to obtain a decryption key, which sometimes does not work, to avoid having these data made public by the threat actor.

In addition to business disruption for weeks or more, ransomware attacks force companies to address multiple legal issues in short order. Companies that decide to pay the ransom must be sure to avoid Office of Foreign Assets Control (OFAC) sanctions restrictions. They also must have an incident response program ready to go, and tested with tabletop exercises, so that when the attack happens, workstreams are clear. From notifying insurance carriers to onboarding incident response forensics companies, to engaging crisis communications and data mining firms, there are multiple policies and agreements to review. There are also contractual notification obligations for business partners and a patchwork of over 50 state data breach notification laws to navigate, such as notice deadlines for individuals and regulators as short at 15 days from discovery of the incident.

Ransomware attacks and other data breaches can also result in liability arising out of state and federal regulatory investigations, class action litigation, and shareholder derivative litigation. They can trigger indemnity provisions in commercial contracts. In this environment, it is critical to have an up-to-date data security program to try to prevent ransomware attacks and other data breaches and an incident response plan to respond to attacks that do happen. The landscape is developing quickly. 

For example, in 2023 alone, the US Securities and Exchange Commission ( SEC ) adopted a rule requiring registrants to disclose material cybersecurity incidents and to annually disclose material information regarding their cybersecurity risk management, strategy, and governance. The  California Privacy Protection Agency  initiated a rulemaking on detailed cybersecurity audit regulations, and the Federal Trade Commission ( FTC ) updated data breach notification requirements for non-bank financial institutions. Is your data security program up to date? Have you pressure-tested your incident program with tabletop exercises? Do you need assistance staying current on this evolving legal and regulatory landscape? ArentFox Schiff can help.

2. More Expansive Definition of Joint Employer Liability by NLRB

The National Labor Relations Board (NLRB) published its final rule addressing the Standard for Determining Joint-Employer Status, with wide-ranging implications for many industries and small-business owners. The NLRB determined that two or more entities may be considered joint employers over a group of employees if each entity has an employment relationship with the employees, and each entity shares or codetermines one or more of the employees’ essential terms and conditions of employment. The effective date of the new rule has been extended to February 26 to facilitate resolution of various legal challenges.

The NLRB defines “essential” terms and conditions of employment as: (1) wages, benefits, and other compensation; (2) hours of work and scheduling; (3) the assignment of duties to be performed; (4) the supervision of the performance of duties; (5) work rules and directions governing the manner, means, and methods of the performance of duties and the grounds for discipline; (6) the tenure of employment, including hiring and discharge; and (7) working conditions related to the safety and health of employees.

The NLRB now considers an alleged joint employers’ authority to control essential terms and conditions of employment , regardless of whether such control is exercised , and without regard to  whether any such exercise of control is direct or indirect . Critical to the NLRB’s determination of joint-employer status going forward is whether an alleged joint-employer maintains  authority  to control essential terms and conditions of employment, even where such employer  has not yet exercised such control . Under the new rule, indirect control, control exercised through an intermediary, or a contractually reserved but never exercised right to control, is sufficient to establish joint-employer status. The NLRB was careful to note that neither all franchisors and their franchisees, nor all staffing or temporary agencies and their client employers will automatically be deemed joint-employers; rather, the joint-employer analysis is driven by the alleged joint-employers’ relationship with the affected employees and their authority to control one or more essential terms and conditions of employment. However, institutions need to be concerned with language in their franchisor/franchisee agreements, employment agency agreements, and management agreements given the NLRB’s newly expansive interpretation of joint employer.

The new rule presents real exposure for alleged joint-employers, including but not limited to: (1) liability for acts of principal employer; (2) obligation to participate in union-related negotiations; (3) exposure to Request for Information Demands relative to both businesses; (4) strikes/boycott of both businesses; and (5) negative public relations. The NLRB rule applies only to cases filed after the rule becomes effective. The US House of Representatives has voted to repeal the new rule, and Senator Joe Manchin (D-WV) has stated he opposes the new rule; however, President Biden has vowed to veto any efforts to overturn the new joint-employer rule.

The NLRB has distinguished its joint-employer analysis from that employed by the US Department of Labor (DOL), with the former being grounded in the National Labor Relations Act (NLRA) and the latter applying an “economic-realities” test to interpret “employer” for the purposes of the Federal Labor Standards Act (FLSA). Under the NLRB, two or more entities may be considered joint employers of a group of employees if each entity has an employment relationship with the employees, and if the entities share or codetermine one or more of the employees’ essential terms and conditions of employment.

3. Corporate Transparency Act Reporting Requirements

Effective January 1 of this year, the Corporate Transparency Act (CTA) requires a number of newly formed and existing entities organized under state law, as well as non-US entities that register to do business in the United States, to disclose their “beneficial owners” ( i.e. , individuals who, directly or indirectly, either exercise substantial control over the entity or own or control at least 25% of the entity’s ownership interests) and provide certain other information to the Financial Crimes Enforcement Network (FinCEN), a bureau of the US Department of the Treasury. Entities that are exempt from CTA reporting include, among others, highly regulated entities such as public companies, banks, large operating companies, and companies that are wholly owned or wholly controlled by entities exempt from CTA reporting (subject to certain exclusions).

A reporting company formed or registered in 2024 must file its initial report with FinCEN within 90 days of its formation or registration, and a reporting company formed or registered beginning in 2025 must file its initial report within 30 days of its formation or registration. The CTA will also apply to companies that were formed or registered prior to January 1, 2024. Such preexisting reporting companies must file their initial reports by January 1, 2025. After filing its initial report with FinCEN, a reporting company must update its FinCEN registration within 30 days of a change in its beneficial ownership or certain other information.

The CTA will directly impact many companies in the hospitality industry. Some entities may be exempt if shares of their stock are publicly traded. Others could be exempt if they satisfy the large operating company exemption, which requires that a company (1) employ at least 21 full-time employees in the United States (there is no consolidation of employees with affiliated companies for this purpose); (2) have an operating presence at a physical office in the United States; and (3) have filed a federal return in the United States for the previous year demonstrating more than $5 million in US-sourced gross receipts or sales. Yet other companies may be exempt if they are wholly owned subsidiaries of CTA-exempt entities.

However, there are many situations where a company will not satisfy any exemption from the CTA and will be required to register with FinCEN. This may be the case particularly where joint ventures are involved, as a company’s exemption may depend on understanding the ownership structure of all joint venture partners. Therefore, care needs to be taken in properly ascertaining an entity’s potential exemption from the CTA, and, if it is not exempt, in identifying its “beneficial owners,” which is not always a straightforward inquiry.

Companies are well-advised to begin their CTA analysis as promptly as possible. This is especially important for companies that may be actively creating new subsidiaries, as those subsidiaries have a comparatively short timeframe to file their initial reports with FinCEN if they are required to register under the CTA. Importantly, there is no consolidated reporting under the CTA, and so each reporting company is required to file its own report.

There are substantial penalties for non-compliance. Any person that willfully fails to submit the required beneficial ownership information, or that provides false or fraudulent beneficial ownership information, may be subject to a civil penalty of up to $500 for each day that the violation continues and a criminal fine of up to $10,000, imprisonment for up to two years, or both. Penalties for failing to comply with the CTA can be imposed not just on the company itself, but also on its senior officers personally and on individuals who willfully cause a company not to file a required report or to report incomplete or false information. This includes refusing to provide required information to a company, knowing that the company will not be able to provide complete beneficial ownership information to FinCEN, or providing false or fraudulent beneficial ownership information to the company.

4. Property and Casualty Insurance Premiums

According to the Council of Insurance Agents & Brokers, commercial property and casualty insurance premiums increased for the 24 quarters preceding Q4 2023. This included increases of 18.3% and 17.1% in Q3 and Q4. Numerous factors are credited for this precipitous rise: the increased intensity and frequency of extreme weather events, the limited supply of reinsurance (which has led to extremely high reinsurance costs), and persistent inflation in the costs of both labor and materials in the construction industry. It seems likely that many, if not all, of these factors will continue to impact the property and casualty insurance market in 2024, with increasing construction demand likely to be a strong factor.

Responding to the continuing surge in these premiums, hotel managers and investors have attempted a variety of strategies to reduce insurance costs. Possibly the most used solution has been to simply obtain lower premiums by agreeing to higher deductibles or lower policy limits. However, there has also been an increased use of captives and other self-insurance methods by those with the financial wherewithal to make such methods viable. 

In undertaking any of these cost-reduction strategies, hospitality industry participants must be mindful of their insurance responsibilities to third parties. These third parties frequently include lenders, but may also include ground lessors, franchisors, managers, owners’ associations, and tenants, among others. It is unusual for the relevant agreements to provide sufficient flexibility to allow for large increases in deductibles or reductions in limits or to permit significant self-insurance, but it may be in all parties’ interests to negotiate changes to avoid extremely burdensome costs in the new insurance environment. Before entering into these agreements, hospitality participants may also wish to consider provisions that allow for the alteration of insurance requirements in response to pervasively high insurance premiums.

5. Tax Provisions in Recently Passed House Bill That Could Impact Hospitality Industry

On January 31, the House of Representatives passed the Tax Relief for American Families and Workers Act of 2024. The legislation contains a limited number of tax provisions, many of which deal with individual taxes. Of particular note for the Hospitality Industry are the following:

  • Business Interest Expense.  The legislation would increase the deductibility of business interest by restoring the depreciation and amortization addback to adjusted taxable income for purposes of computing the Section 163(j) business interest expense limitation. The legislation would return to a 30% limit based on taxpayer-favorable EBITDA (earnings before interest, taxes, depreciation, and amortization) rather than the less taxpayer-favorable EBIT (earnings before interest and taxes). The EBIT limitation took effect beginning in 2022 and applies going forward, absent a change of law. The bill would allow companies an election to use the EBITDA-based limitation for 2022 and 2023 and require the EBITDA-based limitation for 2024 and 2025.
  • Restore 100% bonus depreciation for equipment and other short-lived capital assets placed in service after 2022 and before 2026. Under current rules, after 2022, bonus depreciation starts to phase out by 20 percentage points per year. The existing 20% bonus depreciation deduction for property placed in service in 2025 and 2026 would be retained (with some exceptions).
  • Increase the Section 179 maximum deduction from $1.16 million to $1.29 million and increase the phaseout threshold from $2.89 million to $3.22 million for qualified tangible personal property placed in service in tax years beginning after 2023.
  • Employee Retention Tax Credit.  To pay for the tax cuts in the legislation, the bill would accelerate the deadline for making claims of the COVID-era employee retention tax credit (ERTC) and tighten enforcement. The ERTC can be claimed up to $26,000 per employee for certain wages paid by employers between March 12, 2020, and before October 1, 2021. Under current law, the ERTC may be claimed on amended returns through April 15, 2025. The bill would disallow ERTC claims after January 31, 2024, increase the statute of limitations on assessments of the ERTC, and apply penalties to “ERTC promoters” who have failed to comply with requirements for preparing ERTC claims. (The amount of ERTC claims filed by taxpayers has greatly exceeded original congressional estimates).

While the House vote on January 31 was bipartisan, the bill’s outcome in the Senate remains uncertain. In response to the ERTC proposals, some companies are preparing to submit qualified ERTC claims now that have not yet been submitted.

If you have any questions regarding the legislation, our team of attorneys following the legislation can assist you.

6. Adoption of "Building Performance Standards"

“Building Performance Standards” (BPS) refers to policies and laws that require existing buildings to meet energy or greenhouse gas emissions-based targets as part of an attempt to reduce or offset the carbon impact of those buildings. Through its Building Technologies Office, the US Department of Energy (DOE) has sought to encourage and support state and local governments in their adoption of BPS. According to the DOE, Colorado, Maryland, Washington, Oregon, and the District of Columbia have adopted statewide BPS, while California is currently considering adoption. In addition, 11 counties and municipalities (including New York, Boston, Seattle, Denver, and St. Louis) have adopted BPS and 27 others are weighing adoption. 

BPS vary in their terms and restrictiveness, but the version adopted by New York City as Local Law 97 is being viewed by some as a model. Local Law 97 requires owners of buildings larger than 25,000 square feet to track and report greenhouse gas emissions, with the first reports being due May 1, 2025. The thresholds are set to achieve a 40% reduction (based on determination of carbon emissions per square foot) in the subject buildings’ greenhouse gas emissions by 2025 and will be ratcheted-down on a periodic basis beginning in 2030, with a goal of achieving “net-zero” (where the amount of greenhouse gas emissions going into the atmosphere is balanced by the amount being removed) emissions by 2050.

If a building fails to meet the applicable threshold, Local Law 97 imposes an annual penalty of $268 for each ton of carbon dioxide (CO2) equivalent above the threshold. While, according to an  Axios  report, approximately 91% of the applicable buildings comply with the thresholds in place for 2024, the website developed by the Mayor’s Office of Climate and Environmental Justice predicts that numerous hotel properties (such as the Beekman and the Conrad Downtown hotels) will fail to meet the 2024 standards. The more restrictive 2030 thresholds are predicted to cause far more fines to be imposed, with the same website identifying properties such as the Westin Grand Central, Hilton Club West, and the W Times Square as being unlikely to comply with the 2030 levels.

Adding to these state and local requirements are the long-gestating climate change disclosure rules being promulgated by the SEC. These rules, which are currently scheduled to be finalized in Spring 2024, will likely require public companies to make disclosures related to the amount of greenhouse gasses generated by their activities, greenhouse gases that a company is indirectly responsible for as a result of their activity, and the expected impact of climate change on their businesses.

BPS such as Local Law 97 promise to impose higher costs upon many hotel owners, whether those costs result from fines for failure to meet the law’s thresholds or upgrades necessary to avoid those fines (for example, replacing older gas-fired furnaces with more efficient heat pumps). Local Law 97, like other BPS, does allow for the use or purchase of renewable energy credits (RECs) and other emission offsets through greenhouse gas reduction projects or the installation of onsite solar/wind, to mitigate the impact of the buildings. The disclosure compliance costs under Local Law 97, similar BPS, and the SEC’s disclosure rules will also add financial burdens to the hospitality industry in the coming years. Affected participants would be well-advised to develop a plan to ensure that they are efficiently and effectively complying with applicable disclosure requirements, take advantage of any BPS compliance exemptions (such as Local Law 97’s postponement of compliance during the implementation of a decarbonization plan), and weigh the relative benefits of refitting a non-compliant building.

7. Developments in Artificial Intelligence 

The hospitality industry, as with many other industries, is seeking to keep pace with developments in artificial intelligence (AI) and how to best integrate the newly developed AI technologies into their businesses. The ability of AI to analyze large volumes of data promises to allow the industry to improve purchasing, supply management, staffing, scheduling, and reservations. AI’s pattern recognition abilities may also allow the industry to better forecast demand, anticipate inventory needs and spoilage, handle or vet inquiries from guests and potential customers, or automate check-in and food service functions. In addition, industry participants may be able to use AI to assist in monitor facilities and other security and guest safety functions.

As AI technology evolves, so too is the legal landscape surrounding AI. On October 30, 2023, President Biden issued an Executive Order to, according to the contemporaneous  Fact Sheet  issued by the White House, establish “standards for AI safety and security, protects Americans’ privacy, advances equity and civil rights, stands up for consumers and workers, promotes innovation and competition, advances American leadership around the world, and more.” The  Fact Sheet  noted the Administration’s concerns about job displacement, lowered compensation, and hiring practices in connection with the adoption of AI technologies. It also put a heavy emphasis on privacy concerns and protections to be implemented on the development side of AI.

Federal agencies have already begun rolling out various policy initiatives to implement the Executive Order. For example, the FTC has been increasingly focused on the effects of the rapid development and deployment of generative AI tools, with a particular focus on its impact on consumer products and privacy issues. The US Department of Commerce promulgated a rule that requires reporting by companies that have large computing clusters for training AI systems or assist in foreign AI training. These initiatives are likely just the tip of the iceberg, as lawmakers and regulators are also attempting to react to rapid developments in emerging AI technologies.

We are continuing to monitor developments in AI. Please following  this link  to pre-register for our upcoming webinar, “AI in 2024: What Every GC Needs to Know,” and to receive periodic updates.

8. Repurposing of Office Buildings in Urban Center

In the fourth quarter of 2023, office vacancies in major US cities reached the highest level since at least 1976 (which is when Moody’s Analytics began recording that data). These rising vacancies coincided with precipitous declines in the value of office properties. Capital Economics estimates that the peak to trough decline in US office values will eventually reach 45% and, possibly more concerning, will likely take two decades or more to come back to their peak 2020 valuations.

The dire situation facing the office sector has led to a good deal of exploration into converting existing, underutilized office spaces for alternative uses, including hotels. CBRE estimated that, as of the third quarter of 2023, conversions of approximately 60 million square feet of office space in the United States was either underway or in the planning stages, a substantial increase from the prior year. However, conversions to hotel space made up just a small fraction of the total office conversions — approximately 4%.

Many have found that adding the plumbing, bathrooms, and light wells and enhancing existing heating, ventilation, and air conditioning (HVAC) systems necessary to convert and office building into a hotel, especially when coupled with high borrowing and construction costs, to be too expensive for a conversion to make financial sense. However, as office values continue to decline, that calculus could change.

Moreover, faced with an erosion of their taxes bases due to both declining real estate values and a lack of business activity in their urban cores, many cities have taken steps to encourage development through tax incentives and streamlining development approvals. Most of the tax incentives thus far have been tied to the creation of affordable housing and the stimulus of residential conversions. However, Calgary, Alberta, which is widely considered a model for office conversions, identified the conversion of offices into hotels a key piece of its downtown revitalization plan. Given the burgeoning vacancies and precipitous declines in tax bases in urban cores in the United States, it seems likely that the development of hotels will be part of domestic municipal development stimulus plans.   

David Yearwood, Evgeny Magidenko, Christian M. Mcburney, and David M. Loring also contributed to this article.

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PwC and Oracle Alliance

An ace up the sleeve: 5 hospitality and gaming industry challenges and how CEOs are addressing them

  • 5 Minute Read
  • February 12, 2024

Gaming & Hospitality Consulting Lead, Cleveland, PwC US

Christopher Black

Principal, Finance and Supply Chain Transformation, PwC US

Russell Fields

Principal, Human Capital Management Transformation, Hospitality, PwC US

The hospitality, leisure, gaming and integrated resorts industry evolves and grows quickly. Today, some of the sector's significant challenges include sustaining the rapid growth experienced after the COVID-19 pandemic, adapting to the rapidly evolving regulatory environment as it relates to sports betting (for gaming), and meeting consumer entertainment preferences to remain competitive. That’s why, over the last five years , many top brands have been betting on cloud-based technology to modernize back-office operations and unleash growth. In fact, this is true outside of the hospitality and gaming industry. A recent PwC survey with CEOs worldwide found that 76% of them are investing in technology to reinvent themselves for the future.

So how do cloud-based innovative tools benefit hospitality and gaming businesses? To help understand the business outcomes, let’s dive into five critical business functions that have been attracting cloud investments:

1. Financial reporting

The industry is known for its high-volume and fast-paced decision-making across functions. To support that, having the ability to access real-time data can be the key for Chief Financial Officers (CFOs). It can make or break a brand. Imagine trying to consolidate financial reports across multiple brands while relying on disparate technology systems. This was one casino’s main pain point. As a global powerhouse with several lines of business, the company has a complex business structure, but they were unable to access financial information in real-time from its numerous businesses and systems, which hindered their business efficiency and ability to grow. The organization needed a scalable solution to help bring the scattered data into one platform, gain greater visibility to inform decision-making, and modernize finance processes.

To help overcome this challenge, the company built a flexible cloud platform that provides real-time data to employees across functions, empowers end-users with self-service access to data and reports, and drives business efficiencies.

Another brand, a large regional casino, faced a different — yet common — challenge with multiple customizations and non-standard processes. An outdated financial system and manual processes limited their financial team’s ability to integrate various POS systems and report financials. The excessive customizations resulted in increased cost of IT support and inefficiencies. By adopting Oracle Fusion Cloud Enterprise Resource Planning (ERP) and Oracle Fusion Cloud Enterprise Performance Management (EPM) , the company improved controls and streamlined processes as a result of a stronger project management support, change management and training for a successful implementation.

2. Food and beverage supply chain management

Stepping out of the C-suite and into the restaurant kitchen: Earlier available insights can also be crucial for chefs and managers at restaurants and bars. Managing food and beverage at various outlets (restaurants, production kitchens, bars, etc.) is quite challenging, with little room for error. Several factors contribute to this complexity — including daily orders from vendors, small warehouse space, and quick turns — and require confidence and simplicity in the ordering capability. To help improve this process, many industry leading organizations are taking a two-pronged approach:

To help provide ease of use across the food and beverage supply chain, companies are looking to implement Oracle Fusion Cloud Supply Chain & Manufacturing (SCM) to provide stronger functionality for planning, ordering, and reporting. The increased data visibility with Oracle Cloud SCM offers the ability to place orders with real-time data. From a financial perspective, the transactions integrated from multiple point-of-sale systems into Oracle’s Financial Accounting Hub give the management team insight into the various transactions at property level, restaurant level, and venue level.

As a part of this implementation, PwC leverages their hospitality and gaming model system approach, which includes a hospitality order orchestration solution built on Oracle and designed to help integrate and simplify procurement and inventory management for food and beverage ordering. Leveraging extensive industry knowledge and Oracle technology, this tool can help simplify the front-end to allow users (including chefs, restaurant managers and service employees) to access the information required to effectively check inventory, process orders, execute transfers, and manage their business. This tool provides end-users with an interface to help perform transactions related to inventory, cost transfers, purchases, and inventory return requests. The screen incorporates auto-sourcing logic, which enables users to request items from a supplier or warehouse depending on item availability and priority. It is also available as a mobile solution.

The integrated Oracle solution employs centralized accounting logic across properties, allowing for efficient accounting while also creating financial information that can be used to help inform and improve operations. As this recent Forbes article points out, an integrated solution can help simplify the ability to bring information together into meaningful analysis utilizing the Oracle tools.

One additional benefit lies in the fact that Oracle Fusion Cloud Applications Suite deploys continuous updates and new capabilities, allowing organizations to grow as the product advances and the needs become more complex. As the organization expands the volume of data in its cloud environment, the SaaS vendor can monitor performance and expand the memory or processing capabilities.

3. Human capital management

Down the Las Vegas strip, another resort’s challenges came from disparate human capital management (HCM) systems. The company owns and operates dozens of properties with help from thousands of employees. Like many hospitality and gaming brands, they grew through mergers and acquisitions (M&A), and this resulted in numerous independent fiefdoms, data silos, and high operational costs. But with future business growth plans, they realized the need to simplify and standardize their approach to HR and talent management.

Determined to change the cards they were dealt, they migrated to a centralized platform for core human resources (HR) operations and laid the foundation to support future strategic M&A growth. They invested in Oracle Fusion Cloud Human Capital Management (HCM) , which increased capacity to deploy new capabilities in HR, and eliminated disparate legacy systems that represented high IT operational costs, manual processes and forms that required significant effort to maintain year-over-year.

With this foundation in place, they had a much easier process incorporating the additional data and employees that came with the acquisition of two new companies, and also in opening two new properties. Oracle Cloud HCM afforded the company this meaningful flexibility to allow for new departments, new revenue streams, new sectors of human capital managed by a single integrated platform.

Organizations face a steep climb after an M&A transaction across functions, and this can be particularly hard in human resources. CHROs often need to migrate several thousands of employees from the acquired organization and this can be a difficult task.

The Las Vegas entity had to prioritize system integration, which meant moving HCM and ERP functions from disparate legacy systems to Oracle Fusion Cloud Applications Suite .

The company migrated thousands of active employees to the cloud around the world and into their payrolls; re-implemented legacy and acquired absence plans; re-implemented approval flows; harmonized employee grades and jobs, implemented a new salary band structure; designed a U.S. pilot as the first step towards the adoption of Oracle Journeys, expanded user base of their recruiting/onboarding environment as an interim solution; deployed talent management enhancements; deployed workforce compensation enhancements; enabled new tools; prepared detailed process; and upskilled their workforce. As it continues to expand, the new HCM platform allows the organization to integrate employees quickly and easily.

4. Employee and customer experience

A key aspect of staying competitive is the ability to deliver an exceptional customer experience, and it is undeniable how employee experience can impact the bottom line. By moving away from manual paper processes and embracing automation, the company immediately saw improved employee experience, efficiencies and data accuracy.

Ultimately, it’s about prioritizing efforts. In today’s competitive hospitality market, staff should focus on delivering exceptional customer experience (CX); not on managing a hodge-podge of on-prem manual spreadsheets, for example. The more an organization can automate data processing and reporting, the better it can fulfill its mission to help deliver rewarding experiences for its customers.

Oracle Fusion Applications provides self-service access to data and reports. These changes are enhancing decision-making and CX across core functions. In addition, Oracle Fusion Applications’ updates are scheduled regularly and translate to decreased disruption for the organization and gives employees the opportunity to advance with the system by continually upskilling in conjunction with the updates.

5. Compliance and controls

With daily cyber threats and customer data protection concerns, the hospitality and gaming industry is constantly exposed to potential security threats. That’s why industry COOs and controllers are increasingly making the case that an overhaul of its ERP system should include special attention to risks and controls.

Oracle Risk Management & Compliance can play a key role in helping hospitality and gaming enterprises address regulatory requirements and compliance challenges as part of their ERP journey. Organizations are leveraging Risk Management to tighten controls, meet regulatory trends, enhance customer data protection, and provide the right data access to the right employees based on their roles.

This solution’s continuous monitoring and controls enhanced internal control environments while lowering operational costs and future-proofing the business. With the right tools, hospitality and gaming industry leaders can automate data gathering and reconciliation, enhancing risk mitigation and compliance — including consumer data privacy requirements — across functions.

Playing the right cards in five key business functions

In a tight market, cloud-based systems that can drive efficiencies and modernize processes create an unseen advantage to turn the table and win the game. Many industry leaders have already taken the steps to streamline operations, protect customer data, and future-enable growth. By adopting industry-specific solutions around Oracle Fusion Applications, they can move away from manually intensive tasks that are costly and inefficient while allowing rapid data integration.

The result includes lower operational costs, enhanced risk management and compliance, increased decision-making through real-time supply chain management data, better customer analytics, streamlined reporting which can help inform potential acquisitions, and faster M&A data and process integration.

Through our alliance with Oracle, PwC applies industry leading cloud solutions to propel some of the industry’s largest players and help them capture tangible results. We rely on hospitality and gaming industry benchmarks, target operating models, and pre-configured Oracle systems to help accelerate transformation and help drive industry leading practices. As an alliance collaborator, we apply our deep industry and tech knowledge to our client’s specific challenges to drive lasting transformation. Learn more about the PwC and Oracle Alliance .

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  • Sample Plans

FREE 9+ Operational Plans for Hotel in PDF | MS Word

 operational plans for hotel pdf word

Planning has been an important part of any business undertaking and any decision making that is why a lot of people turn to planning as an ultimate success tool. For a plan to be truly effective, it must be carefully crafted and thought of. Enough time is needed to be able to create a useful plan and that can only be done by preparing a plan ahead of time.

Hotel Operational Plans Pdf Word

Free 4+ yearly lesson plan samples in pdf, free 7+ fashion business plan samples in pdf, free 50+ strategic planning samples in google docs | pages | pdf | ms word.

Featured in this article is an operational plan for a hotel business. We have supplied the necessary hotel operational plan samples and templates that you may need as reference or for personal use. We will also discuss about what an operational plan for a hotel is, the uses of its templates and the five operational activities that impacts a hotel business.

General Hotel Operational Plan

general hotel operational plan 1

Size: 71 KB

Hotel Business Operational Plan Template

hotel business operational plan template

Size: 146 KB

The Ritz-Carlton Business Excellence Roadmap

the ritz carlton business excellence roadmap

Size: 46 KB

Hotel Operational Model with Asset Management Strategy

hotel operational model with asset management strategy 1

Size: 164 KB

General Hotel Service Strategic Plan

general hotel service strategic plan 1

Size: 43 KB

What Is an Operational Plan for a Hotel?

Certain tasks and activities need to be done or fulfilled by hotel businesses regularly to ensure that they provide the services that they promised to offer. But with the number of tasks and activities they need to attend to, how are they able to manage? An operational plan for a hotel is the tool that is used in order to manage the business, and organize and complete the tasks and activities of the business.

An operation plan is an essential tool for managing and keeping things organized. It is a process where strategic and tactical goals are planned based on specific goals and objectives that supports an even larger goals and objectives. With an operational plan, hotel businesses will be able to describe milestones in the business, the conditions under which the business will be successful and explain how or what part of the strategic plan will be put into action or used in actual operations.

There are many important uses of an operational plan one of them has to do with the annual budget for the operations of a business or organization. This is because the operational plan is used as  a basis for the annual budget request. This means that the plan should be able to establish the activities in the business and their corresponding budget for the whole year  or longer. One operational plan should be created each year every time a budget request is needed.

Aside from operational plans for hotels, you can also check out other types of operational plans, like  Business Operational Plan Samples & Templates ,  Security Operational Plan Samples & Templates , and  Project Operational Plan Samples .

Uses of an Operational Plan Template

Operational plans also have their own templates. Why not? Let us take a look the many uses of an operational plan template listed below.

  • It serves as a guide.  An operation plan template can be both used as one’s own operational plan or as a guide for making one. This makes the entire planning process easy and convenient as you don’t have to thin much about formatting and such because the template will help you think about it and give you ideas, too.
  • Provides details on what the contents should be.  If you do not know what to write in certain parts or items in an operational plan, then you can check out similar templates and get an idea and all the other help you can from it.
  • Offers a complete set of information.  Templates are ready-made documents so you can make sure that all the necessary and small details are included in it and that they are all complete. They are done by professionals and were revised many time so there should be no missing items in it.
  • Includes specific steps on how to get tasks done.  Operational plans not only describe tasks that need to be done but it also provides the specific steps on how to get them done correctly.
  • Use in preparation for daily business operations.  With an operational plan ready, businesses can prepare for their daily activities in an organized manner and things will go smoothly as planned.
  • Used as reference or study material.  We do not start as pros when we first start doing something and that is the same thing with creating an operational plan. To get a good start, using operational plan templates as reference or as a study material will help give you ideas on the details and all the other contents of an operational plan.

Want to get different varieties of operational plan template for free? You may visit our website to check them out. You can find them in article, like  Annual Operational Plan Samples & Templates ,  HR Operational Plan Samples & Templates , and  Military Operational Plan Samples .

The 5 Operational Activities That Impact Your Hotel Business the Most

How can you stay on top of things while at the same time managing a very busy hotel? Do you think you can still effectively utilize and follow the operational plan for the hotel that you have set up? That may just be very tough. But hey if you know what operational activities that impact your hotel business the most, then you can surely have control of things. There are five operational activities that impacts a hotel business are revenue management, staffing, hiring, partnerships and procurement. Let us take a closer look at each of them below.

Revenue Management

Room rates, profit, returns, expenses and other costs are just some of the things that must be covered in the business’ revenue management. Hotel business aim to provide their clients with the appropriate price for the rooms that the hotel offer that is why it is a must to keep track and to continuously monitor the business’ revenue. Maximizing the profitability  of the business is also one of the main goals of revenue management. Since it is also one related to finances, it is believed to be a complex process and must taken seriously.

A hotel business operates with the help of its employees or staff. There is also what is called peak season and downtime, and both exists in this type of business. There are different staffing demands in different types of seasons. It is important to determine when the peak and downtimes are so that the right number of people can be assigned to work during these times. You don’t want to end up being understaffed on a very busy night and overstaffed the next day. Don’t you think that’s just an utter waste of money and resources?

What types of employees should be hired? What qualifications must they posses? What values and qualities must they have? These are just some of the questions that hiring mangers ask themselves when searching for applicants to add to to the business’ workforce. Seems like an easy task, but it really isn’t. The people that must be hired or deemed qualified for a job in a hotel are those  that compliment the business model and that is why there are sets of qualifications provided for every position.

Partnerships

How can you make your hotel business more attractive to customers? The answer to that question is partnering with other business, like spas, travel and tours and restaurants to name a few. A total service package would be what your customers want so they would go for the hotel that can offer them all of this.

Procurement

How will you be able to acquire resources and supplies for your hotel business? Planning these activities ahead and doing negotiations will help the business earn significant savings.

Those are the 5 operational activities that impacts a hotel business. You may also be interested in other related titles, like  Simple Operational Planning Samples & Templates , Work Plans , and  School Operational Plan Samples & Templates .

Printable Operational Plan Sample

printable operational plan sample 1

Size: 282 KB

Editable Business Operational Plan Template

editable business operational plan template

Size: 153 KB

Sample Business Operational Plan Template

sample business operational plan template 05

Size: 160 KB

Printable Operating Plan Template

printable operating plan template 01

Size: 251 KB

The Business Plan for Your Hotel

the business plan for your hotel

Size: 41 KB

Importance of an Operational Plan

Why do you think are operational plans important? With an operational plan, business are able to manage everything that they need to do in running a business, regardless if it a starting business or an already existing business. One of the reasons why an operational plan is considered important is that it helps answer four essential questions in planning: what, who, when and how much. These questions refer to what strategies or tasks must be undertaken, who will be responsible for each task or the strategy, when should the tasks or activities be done, and how much will it all cost the business or company.

Another important use of an operational plan is that it supports the goals and objectives that have been set in the strategic plan created by higher or top management. The plan is created with reference to the strategic of the business or company. This means that even if the tasks are different from those in a strategic plan, it still supports its main goals and objectives so that they can be accomplished.

The day to day management of a business is also done systematically through operational planning and this is another reason why it is such an important tool required for the operations of a business, regardless of what type of business it is.

We hope that you are able to learn something from this article. To be able to learn more about operational plan, we have interesting articles on our website that you may want to check out. They are Career Development Plans , Business Plans Samples & Templates , and Meal Plans Samples & Templates  to name a few.

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  4. 2024 Guide to Hotel Operations Management

    What are hotel operations? Hotel operations refers to the day-to-day running of a hotel. It encompasses all the activities and tasks employees perform to prepare for the arrival of guests and take care of their needs during their stay and right through to departure. Hotel operations can be divided into two main areas.

  5. Ultimate Hotel Operations Management Guide [+10 Free Checklists]

    Ultimate Hotel Operations Management Guide [+10 Free Checklists] Coordinating a hotel is an incredibly involved process. It is like a clock being a delicate mechanism that is composed of many different pieces that all fit together and run in unison. Tasks in the hotel industry are a minute strategy that relies on numerous tasks being completed ...

  6. Hospitality Industry: All your questions answered (2024 update)

    4. The overall growth in the travel and tourism industry stands at +5.8% Vs. Overall GDP +2.7%. According to the Hospitality Global Market Report 2023 the global hospitality marketgrew from $4,390.59 billion in 2022 to $4,699.57 billion in 2023 at a compound annual growth rate (CAGR) of 7.0%.

  7. Operations Management in the Hospitality Industry

    Operations Management in the Hospitality Industry | Editors: Peter Szende, Alec N. Dalton, Michelle (Myongjee) Yoo ... This chapter articulates the key design and planning strategies for the development of a successful hospitality organization. ... Forecasting is a vital part of hospitality operations because it allows businesses to make ...

  8. PDF Operations Management in the Hospitality Industry

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  10. 10 Ways on How to Improve your Hotel Operations

    Let's dig into the following best practices and strategies to improve your hotel operations: Impact of COVID-19 on Operations. Making the Right Decisions. Know your Guests and Personalize. Preparation is Key: Don't wait until your Guests Arrive! Empower your Employees. Create a Culture of Ownership.

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    Let's dig into the following best practices and strategies to improve your hotel operations: Impact of COVID-19 on Operations. Making the Right Decisions. Know your Guests and Personalize. Preparation is Key: Don't wait until your Guests Arrive! Empower your Employees. Create a Culture of Ownership. Communicate & Cross-communicate.

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    Teams in the hospitality industry and their functions 1) Front Office The front desk is the best area to cross-sell, 3) Financial team Hotel operations involves the integration of various functions in a hospitality business to deliver high-quality service. Read this guide to know how!

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  14. Hospitality industry makes a strong comeback, but still faces some ...

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  16. How to Improve Hotel Operations in 7 Steps

    Since early 2020, hoteliers and other hospitality industry professionals have been navigating an ever-evolving obstacle course littered with unexpected changes and new challenges. Facing both a shortage of available labor as well as an oversaturated and highly-competitive marketplace, many industry professionals are looking to learn how to improve hotel operations while driving revenue back ...

  17. Operations Management in the Hospitality Industry

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    Housekeeping. Keeping your guest rooms clean and tidy is an essential task. Your housekeeping team is typically responsible for every detail within a room, from the cleanliness of the sheets to maintaining toiletries stocked. Your guests may forget many things, but a clean room will remain in their minds.

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