Hospitality Today

An Introduction

RHM 175
Chapter 1 Service Makes the Difference

Competencies:
1. Define “service” and summarize how service
businesses differ from manufacturing businesses.

2. Explain the importance of strategic planning,

describe the strategic planning process, and
summarize planning challenges in capacity-
constrained businesses.

3. Describe the basic components of a strategic

service vision for service companies, summarize
keys to delivering good service, and describe
Disney’s four basic service priorities.
 What is
Service?
…….generally defined as “work
done for others.” Pages 4-7

Service: Meeting customers' needs in the way that they

want and expect them to be met.
 How service businesses differ from
manufacturing businesses….

Understanding
“Intangible Products”
• The nature of the product is different.
• Customers are more involved in the production
process.
• People are part of the product.
• It’s harder to maintain quality control standards.
• The services provided can’t be inventoried.
• The time factor is more important.
• Distribution channels are different.
Pages 7-11
How to Achieve Superior Service in a
Less-Than-Perfect World
Strategic Planning
• Broad, long-range planning
• Is comprised of a Strategic Planning Process
1. Perform a SWOT analysis
2. Formulate strategies
3. Implement strategies
» Leadership
» Organizational structure
» Corporate Culture
4. Monitor and evaluate results
Pages 11-13
 1. SWOT
- an acronym for strengths,
weaknesses, opportunities, and
threats. A SWOT analysis helps
companies assess how well they are
serving their current markets, an
important step in the strategic
planning process.

Page 12
2. Formulate Strategies

• Example:
– Marriot developed three other
hotels…..
» Courtyard by Marriott
» Residence Inns
» Fairfield Inns

Page 12
3. Implementing Strategies

• Leadership must explain strategies to

employees.
• Win-Win situation for both company and
employees.

Page 12
3. Implementing Strategies

• Organizational Structure may have to

be changed to be successful.
• Positions and Job Descriptions will
change.

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3. Implementing Strategies

• Corporate Culture – employees who buy

into the corporate culture or way of doing
business. Everyone must share the
same values and work ethic.

Page 12
 Planning Challenges in
Capacity-Constrained Business

Productive capacity – example – how many

customers can be served in a restaurant (due to size of
restaurant and number of employees that can serve them).

Capacity-constrained business – Businesses

that produce “products” or service that cannot be inventoried
or stored for future use. Success depends on their ability to
efficiently match productive capacity to consumer demand at
any given moment.

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 Planning Challenges in
Capacity-Constrained Business
• Managing Supply – Hotels have a set number of
beds and restaurants have a set number of tables with chairs.
These cannot be altered if a large amount of individuals visit.

level-capacity strategy
This is also called , which
means the same amount of capacity is offered no matter how
high the demand.

Chased-demand strategy – some hospitality firms

can follow this strategy. Capacity can be varied to suit the
demand level – in a limited way.
Example: Cross-training employees
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 Planning Challenges in
Capacity-Constrained Business
Managing Demand – when supplies cannot be
controlled, demand can be manipulated to benefit your business.

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 The Strategic Service Vision

• Targeting a Market Segment

• Focusing on a Service
Strategy
• Service Standards
• Job Restructuring
• Payroll Control

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 Delivering on the
Service Promise

1. Don’t forget who you are.

2. Encourage every employee to act like a
manager.
3. Handle moments of truth correctly.
4. Hire good people and keep them happy.
5. Respond in a timely manner.

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Service, Disney-Style
• Safety
• Courtesy
• Show
• Efficiency

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