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Things Go Bump in the Night Case Study

Things Go Bump in the Night Case Study

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Published by Shelton D'mello
Case study in the hospitality industry
Case study in the hospitality industry

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Categories:Types, Research
Published by: Shelton D'mello on Aug 24, 2011
Copyright:Attribution Non-commercial

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07/02/2014

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Case Study—Things Go Bump in the Night
Two weeks before her niece’s wedding, Esther Barnes negotiated aroom rate with the Panda Bear Inn. She received a reservationconfirmation number for a double room for two people for twonights. When Esther and her husband arrived at the Panda Bear Inn, much to their dismay, they were told that their room was notavailable because the Inn had overbooked and they would be put upin a different hotel only five miles away.They had been traveling most of the day and were very tired. Mrs. Barnes felt a little better when she was told that the PandaBear Inn would pay for the room at the Lion’s Gate Inn. Drivinganother five miles didn’t seem too much of an inconvenience.However, when the front desk manager told her that the Panda Bear Inn would not host the Barnes’ for the two nights at Lion’s Gate,she became a little irritated. The manager further explained thatPanda Bear Inn had openings for the second night and the Barnes’would have to return to the Inn for the second night.Since Esther wanted to retain the room rate she had negotiated,she agreed and the Barnes’ left to stay at the Lion’s Gate for their  first night in town. After checking in at the Lions’ Gate, they had tocompletely unpack and ready their clothes for the morning breakfastat her sister’s house. The next day, they had to leave the family function and return to the Lion’s Gate, repack their belongings,check out, and drive to the Panda Bear Inn. Once there, they againchecked in, unpacked, and rushed to get ready for the late afternoonceremony and the evening reception.The next morning Esther and her husband felt like they spentmore of their time packing and unpacking than they did visiting andcelebrating with their relatives. During their trip home, Esther toldher husband that their experience reminded her of getting bumpedoff a flight by an airline—but, in this case, they were notcompensated for their inconvenience. She also questioned thelegality of overbooking. She quipped, “What good is a confirmationnumber, when there is no guarantee of a room?” Esther decided towrite a letter to the corporate headquarters of the Panda Bear Innhotel chain.
Do no–shows and late cancellations justify overbooking? Do the operationaladvantages of overbooking outweigh the inconvenience to guests? Were theBarnes’ treated properly? How would you feel if this happened to you?Consider an analogous situation. Imagine going to your hair stylist for a lateTuesday afternoon appointment. You expect to be there for two hours. You arevery excited because that evening you are going to an important businessfunction where you will meet many significant people in your field. However,
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Chapter 9
when you arrive, you are told that Eva, your favorite hair stylist, is overbookedand the salon has arranged for you to have your hair done at the XYZ Salon, ahalf hour away. They explained to you that Tuesdays average three cancellations,so the salon always overbooks. On your Tuesday, however, there were nocancellations. Would you consider this acceptable behavior on the part of thesalon?
Case Commentary: Utilitarianism
The act utilitarian point of view on the Barnes’s situation asks, “Was the greatestgood achieved for the greatest number of people?” Possibly—the only onesinconvenienced were Mr. and Mrs. Barnes. The hotel owners certainly achievedtheir greatest good, at least in the short run. They made the most money possibleby having sold all the rooms. However, allowing guests to think their rooms areguaranteed when they really are not, may have numerous harmful consequencesfor the hotel owners, both short term and long term. The corporation is using theguest to achieve the highest possible profit for that day, while paying lessattention to the guest’s needs and comfort.What are the consequences if a hotel develops a reputation for consistentlyoverbooking? What are the consequences if employees see overbooking asmanagement’s inconsiderate treatment of guests? Employees often take their cuefrom their supervisors. The housekeeper might decide that the bathroom looks“clean enough” for guests. The bellperson might decide to charge a guest forcalling a taxi.An act utilitarian considers
all of the consequences
of the action. There arealso consequences to never overbooking: lost revenue for the hotel owners andempty rooms denied to travelers in need of lodging.For act utilitarianism, deciding the morality of action involves a balancingact: you weigh the total benefits against the total harms likely to result from aspecific act. You are ethically obligated to undertake the action that results in the
 greatest net benefit
for all concerned.In the case of overbooking, the many factors you must balance can make thecalculation fairly complicated. If a hotel only overbooks by X percent of rooms,and the X percent overbooking rate very seldom results in any guest being“walked,” the net harm is relatively small. Since the benefits of a full hotel aremany, act utilitarianism may find this level of overbooking ethically acceptable,because the benefits outweigh the harms.However, it is also a question of how injurious the harms are. If a guestdenied a room because of overbooking is greatly harmed (forced to travel a greatdistance for alternative accommodations, or forced to accept inferioraccommodations, etc.), then the weight may swing in the direction of makingoverbooking unethical. Another factor that would affect the balance (and, hence,the morality of overbooking) is how much overbooking is practiced. If, instead ofX percent of rooms being overbooked, three times X percent are overbooked, andthis higher rate means that guests are frequently denied the rooms they reserved,then the amount of harm increases significantly. Thus, act utilitarianism maycondone a certain level of overbooking but not higher levels. It is all a matter of
 
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examining the amount of benefit and harm done, and choosing the course ofaction most likely to maximize the net benefit for all concerned.Rule utilitarianism applies the principle of “greatest good” to rules ofconduct, not to individual acts. So the question is: can a rule allowingoverbooking be morally justified? It is apparent that rules allowing frequentdenial of reserved service would not produce “the greatest happiness for thegreatest number,” and thus they would be considered unethical. But it is quitepossible that “mild” forms of overbooking, those that result in very few denialsof reserved service and/or in small inconveniences, would be judged ethicallyacceptable.
Case Commentary: Kant’s Categorical Imperative
Kant would view overbooking differently from the utilitarian perspective. Hewould be primarily concerned with the individual rights of the person deniedwhat they were promised. If the hotel had overbooked because there had been anatural disaster in the area and they were trying to accommodate as many peopleas possible, Kant would maintain that this might be acceptable because of themotive behind the action. The overbooking was done out of a sense of duty toone’s fellow man; it, therefore, may be the right thing to do. However from aKantian ethical perspective, it would be much harder to justify overbooking as aroutine business practice ensuring higher daily profits.Consider the two formulations of Kant’s
categorical imperative
that we havestudied. First, we should act in a way that whatever rule we follow, we couldwill this to be a universal rule. Since a reservation is a promise to deliver aservice (room, airline flight, etc.), denial of that service is breaking a promise. Aswith all forms of promising, Kant would condemn breaking the promise becausebreaking promises destroys the very basis of making a promise in the first place.It is self–contradictory to make a promise and break that promise; hence it isirrational and immoral. Thus, the first formulation of Kant’s categoricalimperative would condemn any overbooking that actually resulted in the denialof a promised service.The second form of the categorical imperative stipulates that one must notuse people for his or her own purposes. On the face of it, the practice ofoverbooking appears to do just that. Guests are used to ensure higher profits forthe corporations without regard for the humanity or autonomy of those guests.Essentially, the guest has been “used” because he or she was, in effect, lied towhen the reservation was made.To illustrate this, consider the following situation. You arrive at yourdestination hotel after ten very long hours of traveling including a number ofairplane changes, delays, bad weather, and lost luggage—only to find out thatyour room reservation was not honored. Imagine that you had guaranteed yourlate arrival and even called just a few hours earlier and were assured a room.Now imagine that you have to taxi to another location and you have the furtherinconvenience of informing the airline to deliver your lost luggage to this otherdestination. Would you feel used? Would you have been degraded from thestatus of a human being to that of a “thing” used for someone else’s convenience?

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