Overview Professional Career Opportunities
Chapter 1: Hotel Industry
Overview & Professional Career Opportunities
Lodging is Part of Tourism Industry:
Tourism Industry
Figure 1.1: Segments in the Tourism Industry
Tourism Industry
Destination Hospitality
Retail (Shopping)
(Activity) Sites
Lodging
F&B Operations
Operation
Tourism industry is
third largest retail industry following automotive & food stores nation ’s largest service industry one of the nation ’s largest employers
Lodging is Part of Tourism Industry: Lodging (Hotel) Sector
Lodging properties are a segment within tourism industry
Figure 1.2: Range of lodging property alternatives
Sleeping Destination
Full-service
Limited-
rooms resorts
hotels
service hotels
Lodging is Part of Tourism Industry:
A Brief History of Hotels
Figure 1.3 : Highlights in the modern history of the US hotel industry
Fewer than 10,000 hotels
750,000 to 850,000 rooms 10,000 U.S. hotels
One million rooms
300,000 employees Average size: 60-75 rooms
Occupancy: 85% Hotel construction reaches an all-time peak as
thousands of rooms are added along the new state and federal highways
Lodging is Part of Tourism Industry:
A Brief History of Hotels (continued ….)
Figure 1.3 : Highlights in the modern history of the US hotel industry
Occupancy: 65%
AHA ’s Hotel Red Booklists 20,000 hotels Occupancy: 64%
Average room rate: $3.21 Occupancy: 80%
Typical hotel: 17 rooms Average room rate: $5.91
Occupancy: 67% $3 billion in sales
Typical hotel rooms: 2,400,450 Typical hotel: 39 rooms, independent and locally owned Average room rate: $5.91
Lodging is Part of Tourism Industry:
A Brief History of Hotels (continued ….)
Figure 1.3 : Highlights in the modern history of the US hotel industry
Occupancy: 65% $8 billion in sales
Total hotel rooms: 1,627,473 Average room rate: $19.83
Occupancy: 70% $25.9 billion in sales
Total hotel rooms: 2,068,377 Average room rate: $45.44
Lodging is Part of Tourism Industry:
A Brief History of Hotels (continued …)
Figure 1.3 : Highlights in the modern history of the US hotel industry
Occupancy: 64% $60.7 billion in sales
1990 Total hotel rooms: 3,065,685
45,020 properties Average room rate: $58.70
Occupancy: 63%
$97 billion in sales
Close Look at Lodging Organizations
Figure 1.4: 2000 Property / Room Breakdown
By location
By rate
By size
Under 75 rooms
9.9% Over 500 rooms
Close Look at Lodging Organizations:
Typical Lodging Guests
Figure 1.5: Typical lodging guests
are transient business travelers
are attending a conference/group meeting
are on vacation are traveling for other reasons (for example,
personal, family, or special event)
Close Look at Lodging Organizations: Lodging Industry Characteristics
Emphasis on safety, cleanliness & service - Guests also consider “intangible” aspects of the purchase
decision Inseparability of manufacture & sales
- A room exists & is sold at the same site Perishability
- If a room is not rented on a specific date, the revenue is lost forever
Repetitiveness - Some operating procedures are routines
Labor Intensive - Much of a hotel ’s daily work involves employees
providing services
Close Look at Lodging Organizations:
Lodging Industry Overview
Largest hotel affiliations
Figure 1.6: Top 5 lodging brands
6,540 2. BASS HOTELS&RESORTS, INC.
1. CENDANT CORPOPRATION
3,030 3. MARRIOTT INTERNATIONAL
1,846 4. CHOICE HOTELS INTERNATIONAL
4,219 5.HILTON HOTELS CORPORATION
These five represent some 28 % (14,884 / 53,500 properties) of all domestic properties, & 42 % (1,708,617 / 4,100,000 rooms) of all rooms. The majority of these brands do not “own” their hotels, but hotel owners elect to affiliate with the brand, for a fee.
Close Look at Lodging Organizations: Lodging Industry Overview (continued ….)
Hotel ownership / management
Single-unit property not affiliated with any brand Single-unit properties affiliated with a brand Multi-unit properties affiliated with the same brand Multi-unit properties affiliated with the same brand Multi-unit properties affiliated with different brands Multi-unit properties operated by the brand or others Multi-unit properties owned by the brand
Close Look at Lodging Organizations: Lodging Industry Overview (continued ….)
Figure 1.7: Hotel Ownership / Management Alternatives
Hotel property
Management Operation Independent
Franchise Management
company
Independent
company
company
(Franchisor)
Close Look at Lodging Organizations: Hotel Organizational Structures
Small Hotel (75 rooms)
Figure 1.8: Organizational Chart for Small (75 Rooms),
limited-service hotel
Bookkeeper
Manager
/Accountant
Custodial
Housekeeping
personnel
personnel
Close Look at Lodging Organizations: Hotel Organizational Structures (continued ….)
Large Hotel (350 rooms)
Figure 1.9: Organizational Chart for Large (350 rooms),
full-service hotel
Administrative
G.M.
Assistant G.M.
Chief Controller
of sales & office
director Manager
housekeeper engineer
marketing manager
Close Look at Lodging Organizations:
Hotel Departments
Line & staff departments
Those directly involved in the “chain of command”. Directly responsible for revenues
Line department
- Front Office & Food / Beverage Also responsible for property operations - Housekeeping, Maintenance, & Engineering
Providing technical, supportive assistance to
Staff
support line decision-makers
department
Making recommendations to (but not decisions for) line decision-makers
- Purchasing, human relations, and accounting
Close Look at Lodging Organizations: Hotel Departments (continued ….)
Revenue and cost centers
A hotel department that generates revenue - Front office & food / beverage departments
Revenue center
- Also revenues from telephone services, space rental and fees from parking garages, vending machines, and golf courses
A hotel department which incurs costs in support of a revenue center
Cost center
- Marketing, maintenance, accounting, human
resources, & security departments
Lodging is a Service Business
Successful hotels greatly emphasize serving their guests to the best possible extent.
The brand name a hotel uses is not the most important factor in a hotel ’s success.
When hotels put guests ’ needs first, those hotels will do well.
Consistent delivery of quality of products and services to guests must be addressed first, rather than considering tactics to Facility Engineering & Maintenance
maximize revenue; minimizing costs comes next!
Lodging is a Service Business (continued ….)
Questions that must be addressed to deliver quality service:
How will we show our staff and tell them about the need for high quality guest service?
How exactly will we evaluate the level of service quality being provided to our guests?
What exactly are our service strategies and our service procedures?
How will we train our staff about service concerns and the tactics to deliver service?
How will we reinforce our service strategies? What can we do to emphasize service as a philosophy rather
than as a program with a definite start & end time? What can we do to excel in the guests ’ moments of truth?
Current Issues confronting Hoteliers:
Operating Issues
Labor shortages
Managers should implement procedures to: a) reduce turnover levels, b) increase productivity levels, c) recruit from non-traditional employee labor markets.
Cost containment
Hoteliers should examine ways to reduce costs without impacting quality.
An excessive emphasis on cutting service or product quality will ultimately result in reduced hotel revenue.
Increased competition
Overbuilt problem
Current Issues confronting Hoteliers: Marketing
Issues
Market segmentation is increasing
Efforts to focus on a highly defined, smaller group of travelers.
Brands overlap
The more the number of brands increase, the harder consumers find it to differentiate between them.
Increased sophistication of consumers
Results in a more competitive selling environment for hoteliers (e.g., online room booking)
Increased number of amenities
Various amenities (e.g., business centers) increase costs for hotel owners yet sometimes appeal to only a small segment of the hotel ’s market.
Current Issues confronting Hoteliers: Technological Issues
Recent technological innovations include:
Interactive reservation system - Allows potential guests to make reservations at preferred
room rates in reduced time Guestroom innovations - Two (or more) telephone lines enabling Internet access /
interactive menu ordering for room service / electronic games and guestroom checkout
Data mining technology - Analyzing guest- (and other) related data to make better
marketing decisions Yield management
- Matching guest demand with room rates
Current Issues confronting Hoteliers: Economic Issues
“As goes the economy, so goes the lodging industry” Impact of globalization on the lodging industry
Lodging industry is an integral part of the tourism industry - It is affected by the extent to which travelers, both within
the country and worldwide travel Economies of the world, the country, the state and the community
play on the financial success of a lodging organization & the Facility Engineering & Maintenance individual properties which comprise it.
Close Look at Lodging Organizations: Lodging Industry Overview (continued ….)
G.M / Rooms division M. / Front office M. / Controller / Executive housekeeper / Catering M. / Executive steward / F &
B M. / Banquet M. / Chef / Executive chef / Food production M. / Pastry Chef / Sous chef / Room service M. / F & B controller / Restaurant M. / Beverage M. / Purchasing Director / Human Resource M. / Credit M. / Executive assistant M. / Convention M. / Marketing & sales M. / Auditor / Director of security / Convention services director / Resident M / Chief engineer
Typical Multi-Unit Positions: Area G.M. / Regional G.M. / Director of Training / Vice president, finance / Vice president, real estate / Director of franchising
Professional Career Opportunities in Lodging: Get Started With Career Planning
How does one start to plan for a career in the lodging industry?
Enrolling in and graduating from hospitality-related programs of study
Working in a variety of lodging positions (including educational internships)
Developing a career ladder for professional development within the lodging industry
- Working with a mentor Obtaining suggestions by talking with G.M.s at hotels nearby
industry leaders and educators
Chapter 2:
The Hotel General Manager
Responsibilities
Investor relations Community relations
G.M.s ’ tasks
Brand affiliation Property management
management
Executive Committee development
The single most important human variable
G.M.s
affecting a hotel ’s short-term profitability “Wear many hats” (perform multiple tasks)
Responsibilities: Investor Relations
G.M.s ’ ability to effectively inform investors & owners about current performance & future needs of their hotel/s
Property ’s long-term success
To successfully manage owner / investor relations:
Financial analysis ability
G.M.s ’
Proficiency in written communication
talents
Effective public speaking / presentation skills
Responsibilities: Brand Affiliation
Management
Managing brand at the property level
Continually monitor operational standards set by the brand to ensure property performance
Communicate effectively with franchise brand officials about marketing & sales programs
Improve profitable operation of hotel by using activities & programs offered by the brand
To successfully manage owner / investor relations:
Well developed interpersonal skills
G.M.s ’
Persuasive ability
talents
Listening skills Effective writing ability
Responsibilities: Brand Affiliation Management
(continued …)
Quality Inspection (or Assurance) scores
Result of annual (or more frequent) inspections by franchise company
Used as measure of effectiveness of G.M., of hotel ’s management team, and of owner ’s financial commitment to the property.
Ensuring franchiser-mandated standards are met by franchisee Becoming an important example of how the G.M. interacts with
franchisers and/or management companies
Responsibilities: Community Relations
Opportunities to assist the local community
Attract new businesses Expand tourism opportunities Provide input regarding local business community needs Have charity events and fundraisers at the hotel
To successfully perform community relations
Outgoing personality
G.M.s ’
Well-developed social skills
talents
Effective public speaking & presentation skills
Responsibilities: Executive Committee Facilitation
Functional area
Responsible for
Human Resource Manager
Hotel staffing needs
Controller Accounting for hotel assets and liabilities Front Office Manager
Guest services and sales
Executive Housekeeper
Property cleanliness
Food & Beverage Director Food & beverage production & service Security Director
Guest, employee & property safety/security Sales & Marketing Director
Revenue production & promotions
Chief Engineer
Upkeep of hotel ’s physical facility
Responsibilities: Executive Committee Facilitation (continued …)
General Manager
Typical mid-sized, full-service hotel department organizational chart
Responsibilities: Executive Committee Facilitation (continued …)
Wrong expectations regarding the G.M.
That he/she must be an expert in specific day-to-day operations of each hotel ’s department
Right expectations regarding the G.M.
That he/she works with EOC to improve skills & efficiencies of the departments these individuals manage
That he/she assists their professional development
To successfully manage the EOC facilitation
Good listening skills
G.M.s ’
Ability to evaluate / implement managerial training &
talents
development program Assisting in professional improvement & growth of EOC team
Responsibilities: Property Management
G.M. should be able to direct overall property management.
Process of planning, organizing, staffing, directing, controlling and evaluating human, financial and physical resources, to achieve organizational goals.
To successfully handle property management:
Organizational & coaching skills
G.M.s ’
Analytical & financial analysis skills
jobs Ability to anticipate guest needs
Competitive sprit & high attention to detail
Responsibilities: Property Management
(continued …)
Functional area
Purpose
Planning
To establish goals and objectives
Organizing To maximize deployment of resources Staffing / directing
To provide leadership
Controlling / evaluating To measure and evaluate results
Management process
Planning
Controlling & evaluating Organizing
Staffing & Directing
Responsibilities: Property Management
(continued …)
What is the goal of providing in-room, high-speed
Planning
Internet access to guests?
Organizing How will the hotel allocate necessary dollars to
achieve this goal?
What needs to get done to keep staff “on task”
Staffing /
Directing with project completion timelines?
Controlling / How will the hotel measure sales volume or reputation
value gained versus cost of providing in-room Internet
Evaluating
service?
Skills Development: Formal Education
Program titles
Hotel admin. / hotel & restaurant mgt. / hospitality admin. / restaurant, hotel, & institutional mgt. / food service mgt. / hospitality business / tourism admin. / culinary arts
Two-year degree
Designed for both traditional college students & non-traditional working students
Wish to terminate their formal education after several years of
For whom
study Have a B.A. degree in another subject & wish to gain
knowledge of the hospitality industry Highly practical & current
Benefits Practical professional instructors who may be well connected
in the community (assisting job placement)
Skills Development: Formal Education
(continued …)
Four-year degree
Wish to complete a B.A. degree Seek to learn from a larger number of quality
For whom
faculty Wish a “more advanced” degree than two-year
Have diverse faculty & quality facilities
Benefits
Offer an excellent learning environment
Advanced degrees
Checklists Admission requirements Program designs
Skills Development: On-the-Job Training
Learning activities designed to enhance skills of current employees
OJT
Offered by management with intent to improve guest service & employee performance
Generally no charge to employee for training
OJT trends / focuses for hotel G.M.s
Impact of advancing technology Impact of a changing workforce
Skills Development: Professional Development
Business associations
Membership benefits / activities of local business associations (e.g., local Chambers of Commerce)
Business / skills enhancement programs Networking opportunities Timely publications & seminars including local economic data & best
management practices In some cases, providing low- or no-cost training for entry-level
workers Lobbying for business interests & facilitating public-private
employment initiatives Updating on recent business thoughts & methods
Skills Development: Professional Development
(continued …)
Trade associations
Serve certification, educational, social and legislative needs of their members Hold monthly and annual gatherings Offer educational seminars / workshops Have Trade Shows
Efficient way to see new products & service offerings of a large number of vendors in a short time Example of the hotel industry
Educational Institute of the American Hotel & Lodging Association
Trade publications
Current two major interests
Technology applications / human resource management
Help staying updated on current info
Chapter 3:
Management and Supervision
Skills for the G.M.
The G.M. Sets the Pace
G.M.s feelings & actions about issues will likely impact hotel staff attitudes about those issues.
G.M.s personally direct only the work of department heads and, perhaps, relatively few other staff.
G.M.s ’ interaction with department heads directly impacts how they interact with their own staff.
Influence
Desired product Level of morale
Employee
turnover rates
& service quality
G.M.s Must Manage: Organizational Levels
Top-Level Management (G.M.)
Middle-Level Management (Department Heads)
Supervisory-Level Managers (Supervisors/Managers)
Entry-Level Employees
Of resources available, people (human resources) are the most complex and important for success!
G.M.s Must Manage: G.M. Functions
Management Examples of activity: Working with Function
department head (if applicable) to:
Planning Develop an operating budget or a marketing plan
Assign responsibilities for an upcoming banquet or conference
Recruit, select, orient and train new department heads
Directing Supervise the work of department heads
Take corrective action(s) when budgeted financial plans are
Controlling
not attained Assess the extent to which long- and short-range plans were
Evaluating
attained
G.M.s Must Manage: G.M. Skills
Conceptual Interpersonal
Ability to collect, interpret, Ability to understand and and use information logically
interact well with guests, employees, suppliers, etc.
Learning about a new, competing hotel opening nearby and making future marketing decisions accordingly
Skills
Administrative Technical
Ability to organize and Ability to perform direct required work efforts
management-specific aspects of the job
Ability to develop policies and Forecasting guest demand for
operating procedures necessary rooms and establishing room
for guest safety
rates, etc.
G.M.s Must Manage: G.M. Relationships
Staff members Other hotel employees
Yesterday: dictatorial leadership
“Manage by walking Today: facilitators
around ”
Tomorrow: empowerment
External organization
G.M.
Others in community
Participating in
Joining professional business and community social events
community service organizations Attending school & athletic
Meeting with community events with their children
government representatives
Guests
How the hotel can meet and exceed guest expectations
G.M.s Must Manage:
G.M. Manage in Times of Change
Relative to their counterparts “yesterday” G.M.s must
Interact with a more diverse workforce Emphasize teams rather than individual performance
Cope with fast-paced technology changes Adjust to workplace changes (e.g., re-engineering, downsizing)
React to global challenges Improve quality while increasing productivity Improve ethical / social behaviors
Evolution of Traditional Hotel H.R. Practices
Traditional
Contemporary
Manager-focused work unit
Team-focused work unit
Manager is dominant
Manager is supportive
Emphasis on technical skills Emphasis on employee facilitation skills Manager seeks stability
Manager encourages change
Manager tells and sells personal views
Manager listens
Manager personally responsible for results Manager shares responsibility for results Manager personally solves problems
Team problem-solving is employed Pride, recognition, and growth are used to
Fear and pressure used to motivate staff
motivate staff
Autocratic (dictatorial) decision style
Participative decision style
Individual behavior
Team behavior
Evolution of Traditional Hotel H.R. Practices
(continued …)
Traditional
Contemporary
G.M. forces compliance G.M. earns the team ’s support What one says is inconsistent with what What one says is consistent with what one
one does
does
Inconsistent “moments of truth” Consistent “moments of truth” Reactive management/supervision style Proactive management/supervision style Bureaucratic “rituals”
Flexible routines
Top down – one way communication Multi-directional communication Hierarchy of control
Short-term H.R. strategies
Long-term H.R. strategies
Management Basics: Planning
Vision
What the hotel will strive to be
Mission Statement What the hotel must do to be successful
and how this will be accomplished Hotel ’s goal for long-range (e.g., five
Long-Range Plan
year) time span
Short-Range (Business) Plan Hotel ’s goal within a one-year time span
Anticipating revenues and expenses
Operating Budget
during short-range plan implementation
Marketing Plan What must be done to generate revenues
anticipated by the operating budget
Management Basics: Decision Making
Before making a decision
Who is the correct person to make decisions? Will a decision about a specific issue bring the hotel closer to
attaining objectives and goals? How will the decision affect guests? Is there only one acceptable alternative? How much time and effort can be spent on the decision? How does one ’s experience help with decision making? Must the decision please everyone? What are the ethical aspects of the decisions?
Programmed decision Non-programmed decision
Routine and repetitive decisions Infrequent decisions requiring made after considering policies,
creative decision making abilities procedures, or rules
Management Basics: Decision Making Approach
Continuum of decision making
Manager makes
Manager allows decisions
Manager makes
team to make unilaterally
decisions after
input from
decisions
others
Management Basics: Decision Making
(continued …)
Advantages Disadvantages
Considering broad range Possible conflicts of information
May be forced to “take Generating more creative
sides ” if alternative
Group
alternatives opinions are expressed
decision
Whole team keenly
Domination by staff aware of issues and
making
members with strongest problems
process
personalities
Achieving higher morale Time-consuming Easier implementation
Not applicable when fast decisions necessary
Management Basics: Organizing Principles
Unity of command Span of control
Each employee should report Limit to how many staff or be accountable to only
members one supervisor can one boss for a specific
manage effectively
activity
Distribution of authority
Types of
Used by
Example
authority
Develop orientation program for all hotel Advisory
Staff managers
employees
Hiring and firing employees within a specific Line
Line managers
(within departments)
department
Line managers (between Executive housekeeper establishes table linen Functional
departments)
laundry schedule with F&B dept.
Management Basics: Delegation
Delegation benefits for the What work might be
G.M.
delegated by the G.M.?
Allows the G.M. to do Work that others can most important things
do as well as the G.M. first
Work that is less Effective process to
important than other train employees
work
Allows more work to Work that should be
be accomplished learned by more than one person
Improves controls
Management Basics: Delegation (continued …)
Steps in effective delegation
Organizational climate necessary for delegation Assign specific duties & responsibilities to employees
Grant sufficient authority for carrying out assignments
Supervisor & employees agree on expected results Communicate responsibilities to minimize confusion
Managers make feedback system to measure progress
Management Basics: Flow of Communication
Multi-directional communication
G.M.
Vertical Comm.
Department Heads (Executive committee)
Formal channel (example): coaching Informal channel (example): grapevine / rumor mills
Management Basics: Motivation
Poorly motivated staff
Inconsistent performance for required quality or quantity standards
Guest dissatisfaction
Increased operating costs More motivated employees ’ leave
Hotel suffers
Management Basics: Motivation (continued …)
Strategies to motivate employees
Follow sound management advice Effective orientation
Train correctly Manage a professional hotel
Supervise as you want to be supervised Encourage effective communication
Manage a friendly hotel Help your employees succeed
Management Basics: Leadership
Effective leaders will:
implement the property ’s Mission Statement have an objective & measurable “picture” of hotel’s desired
future help others develop the knowledge and skills needed to
attain hotel ’s vision (e.g., orientation, training, and coaching)
utilize the empowerment process develop team of staff committed to hotel ’s success achieve a reputation for quality service consistently
delivered to guests cultivate a reputation for fairness and honesty
Management Basics: Discipline
Discipline: activities reinforcing desired performance or correcting undesired performance.
Steps in a progressive discipline process
Oral warning (no entry in employee ’s record)
Oral warning (entry in employee ’s record) Written reprimand
Suspension for specific number of days
Discharge
Team Building Tactics
Self-directed team To be a good team leader, the G.M. must
More control over work Have high standards and responsibilities
expectations Support individual members
Make work assignments and maintain trusting and within the team
respectful relationships Schedule themselves
Practice participative management and solicit input
Evaluate each other ’s work
from members
Assign compensation Demonstrate that own personal increases
goals and individual team member goals should not be placed before team goals
Share credit for team successes
Employee Selection, Orientation, and Training
Personnel tactics checklist
Recruitment / selection tactics General orientation tactics
Correct training Departmental / orientation and workstation / induction tactics Train-the-trainer tactics On-the-job training (OJT) tactics Supervisory / other training tactics Training budget Other training issues
G.M. Interactions
G.M.s never have a daily routine; every day is different Actual daily activities undertaken by a G.M. vary from day-
to-day & month-to-month as well as from property-to- property
Daily involvement in guest relations are quite visible
G.M. is on duty eight or more hours daily and is often on- call even when not on the property
G.M. Interactions: Employees
Possible interactions with employees: positive examples
Daily conversations with long-term staff Learning employees ’ suggestions about possible operating improvements Welcoming new staff to the team Congratulating personnel about significant events in their families ’ lives Mentoring younger workers
Following employees ’ careers as they are promoted within the organization Providing non-job related advice when requested Observing employees at a company picnic enjoy themselves Observing staff who participate in community organizations/activities
G.M. Interactions: Employees
Possible interactions with employees: negative examples
Disciplining or terminating staff Confronting staff known to be stealing Learning about illegal acts committed off-property by staff Assigning work responsibilities to cover “no show” employees Discovering employee “sabotage” Supervising staff violating hotel policies, requirements, and rules. Comforting an employee whose child has passed away Observing an intoxicated employee attempting to come to work Explaining to staff why they did not get promotions they sought
G.M. Interactions with Guests
Possible interactions with guests: positive examples
Interacting with frequent guests Receiving spontaneous “Thank You Notes” from happy guests Observing hotel guests celebrate significant family / professional
occasions Providing service / assistance to guests
Receiving input from guests who genuinely want the hotel to be successful
Interacting with guests as peers at community / professional meetings Providing accommodations to guests stranded by adverse travel
conditions Receiving guest input about hospitable staff members Interacting with frequent guests
G.M. Interactions with Guests
Possible interactions with guests: negative examples
Interacting with police called to hotel for disturbances or illegal guest activities
Guest deaths in sleeping rooms or in the hotel ’s public spaces Dealing with visibly intoxicated guests Preventing on-site prostitution Preventing guest theft of money, products and/or services from the hotel Preventing property vandalism Calming irate guests stranded by adverse travel conditions Discovering overt guest room damage
Interacting with police called to hotel for disturbances or illegal guest activities
Chapter 4: Human Resources
H.R. Department Roles
Line managers H.R. specialists
Making final employee Helping line managers
selection decision with H.R. related duties
Providing departmental- - employee selection
H.R. is both
specific orientation
- orientation
line & staff
- training
Initiating ongoing training function
- evaluation
Supervision activities - compensation (e.g., performance appraisal)
G.M. must define authority boundaries between line- & staff managers.
H.R. Department Roles (continued …)
How H.R. personnel assist in hotel ’s overall operation
Implementing policies to effectively recruit, select, motivate, and retain the most qualified management and non-management staff
Developing and delivering orientation, safety, security, supervisory, and some department-specific training programs
Developing and communicating H.R. policies that are equitable and fair to all employees while protecting the rights of the hotel
Interpreting, implementing, and enforcing the ever-increasing body of laws and regulations
Helping to maintain appropriate standards of work life quality and ethical business policies and practices
Staffing the H.R. Department
Job descriptions Job specifications
A list of tasks that an A list of personal qualities employee in a specific
necessary for successful position must be able to
performance of the tasks required perform effectively
by the job description Statements about duties,
Two Statements about knowledge,
responsibilities, working skills, education, physical &
staffing
conditions & specific job
personal characteristics activities
tools
Example: H.R. Director Example: H.R. Director (recruitment, selection,
(considerable knowledge of evaluation, promotion)
principles & practices of H.R. management)
Legal Aspects of H.R.: Employee Selection
Bonified Occupational Qualifications (BOQs):
Qualifications to perform a job that are judged reasonably necessary to safely or adequately perform all tasks within that job
Legitimate BOQs
Education or certification requirements Language skills Previous experience Minimum age (for jobs such as waitress or bartender)
Physical attributes (amounts able to be lifted, carried etc.) Licensing
Legal Aspects of H.R.: Employee Selection (continued …)
Tools to screen employee applicants
Only provide info directly relating to the job
Employment
Demographic info, employment history, educational
applications
background, criminal history, employment status, references, drug testing
Race, religion and physical traits should not be asked
Interviews
Age may be asked only for the purpose of legal requirements Follow strict state guidelines and requirements for pre-
Testing
employment drug testing Obtain applicant ’s permission in writing for background and
Other
reference checks
Legal Aspects of H.R.: Employee Selection (continued …)
Equal Employment Opportunity Commission:
Employers cannot discriminate against employees on the basis of race, color, religion, sex or national origin.
Americans with Prohibits discrimination against job Disabilities Act (1990) candidates with disabilities
Age Discrimination in Protects individuals 40 yrs and older Employment Act (1967)
Immigration Reform & Prohibits hiring illegal immigrants Control Act (1987)
Protects young workers from
Fair Labor Standards Act employment interfering with education
(1938) or that is detrimental to health
Legal Aspects of H.R.: Employment Relationships
“At-will” employment Employment agreement
Employers can hire or Document specifying
terminate any employees the terms of the employer
with or without cause at – employee work any time
relationship
Employees can elect to Indicates rights and work for the employer
obligations of both or terminate the work
parties
relationship anytime
Legal Aspects of H.R.: Workplace Laws
Sexual harassment
One cannot ask favors of a subordinate in exchange for employment benefits; neither can one punish an employee if an offer is rejected.
A G.M. should follow strict zero tolerance policy & procedures - issuing of appropriate policies
- conducting applicable workshops - developing procedures to obtain relief - developing written protocols for reporting
- investigating & resolving incidents & grievances
Family & Medical Leave (1993)
Hotels (employing 50 or more staff) should provide up to 12 weeks of leave (unpaid) to an employee for a birth, adoption of a child or serious illness of immediate family members.
Legal Aspects of H.R.: Workplace Laws (continued …)
Compensation
The Fair Labor Standards Act (FLSA) establishes minimum wage, overtime work rates, and equal pay regardless of gender.
Employee performance
Employee evaluation (assuring work performance [nothing else] forms the basis for employee evaluations)
Discipline (effectively communicating and consistently enforcing workplace rules and policies) Termination (preventing unacceptable termination of employee/s)
Unemployment issues
Unemployment insurance (allowing temporary financial benefits to employees who have lost jobs)
Unemployment claim (asserting the worker is eligible for unemployment benefits)
Legal Aspects of H.R.:
Workplace Laws (continued …)
Employment records
Selected employee records should be maintained. Examples of record keeping:
- Department of Labor records (e.g., employee ’s name, address, gender, job
title, work schedule, hourly rate, regular and overtime earnings, wage deductions and payday dates)
- any deductions from wages for meals, uniforms, or lodging - amount of tips reported (for tipped employees)
- covered leave and amount of leave for eligible employees (Family & Medical Leave Act)
- employment eligibility verification (Immigration Reform & Control Act) - personnel matters & benefit plans (Age Discrimination & Employment Act)
H.R. Department at Work: Recruitment
Internal recruiting External recruiting
Focusing on internal Focusing on internal Hiring from outside applicants for vacant applicants for vacant
sources
positions positions Newspaper and other “Promotion from within”
media advertisements / Alerting friends and
job fairs / executive
Recruitment
relatives of current search firms / recruiting
employees at schools / “help
methods
Recruitment is not solely wanted ” signs
the job of H.R. department Attracting external candidates
Current staff can impact hotel ’s turnover rate
H.R. Department at Work: Selection
Selection:
Evaluating job applicants to determine those more qualified (or potentially more qualified) for positions.
Selection devices
Preliminary screening (reviewing application) Employment interviews Employment tests
Reference checks Drug tests
H.R. Department at Work: Orientation
Orientation:
Providing basic information about the hotel which must be known by all its employees.
Goals
Contents
Reducing anxiety
Hotel overview (mission statement)
Improving morale Guest service / relations training
Reducing turnover Emphasis on teamwork Providing consistency
Policies and procedures including handbook
Developing realistic Compensation and benefits expectations Guest safety & security
Employee & union relations Property tour
H.R. Department at Work: Training
Training is absolutely critical to the hotel ’s success !
Improve knowledge or skills of staff New employees and experienced staff need training
Ongoing professional development can motivate staff and help employees ’ advancement opportunities
Implement “train the trainer” program
Group training Individualized training
Effective when several (or more) One-to-one training method staff must learn the same thing
Use of a role-play (e.g., upselling Mainly responsible for training for front desk agents)
individualized line departments
H.R. Department at Work: Performance Evaluation
Determine where staff can improve performance Assess eligibility for pay raises and promotions
Goals
Improve morale Assure legal compliance
Develop policies & procedures for property-wide system
H.R.
Communicate these policies & procedures to all staff
Dept.
Address and resolve employee concerns as they arise
Roles
File performance evaluation results in employee records
H.R. Department at Work:
Performance Evaluation (continued …)
Steps of performance appraisal system
Performance standards are established for each position Policies (e.g., frequency of rating) are established
Data is gathered about employee performance
Raters must evaluate performance
Discuss performance evaluation with employees
Evaluation information is filed
The H.R. Department at Work: Compensation
Compensation:
All financial & non-financial rewards given to managers & non- management staff in return for their work.
Direct financial compensation Indirect financial compensation
Salary / wages Benefits (health insurance, paid vacations, etc.)
Effective compensation programs should be:
Legal / fair / balanced / cost effective / viewed as reasonable by staff
Establish pay for specific positions based on:
What other employers attempting to attract the same applicants pay. What employees working on different jobs in the hotel are paid. What other employees working on same jobs within the hotel are paid.
H.R. Department at Work: Employee Safety & Health
Work-related accidents & illnesses
Work to be done Working conditions
e.g., cooks using knives e.g., greasy floors in kitchen
H.R. staff assistance for health related activities
Developing and selecting programs to help employees cope with stress Developing procedures applicable to workplace violence
Communicating updated info about HIV in the workplace Providing info about cumulative trauma disorders
H.R. Department at Work:
Workforce & Work Quality Improvement
Professional development
Improving
HN
Cultural diversity
work
IQ
quality
Continuous quality
improvement
Chapter 5: The Controller
Accounting
Controller: individual responsible for recording, classifying, and summarizing the hotel Facility Engineering & Maintenance
’s business transaction.
Purpose of bookkeeping
Record and summarize financial data
Purpose of accounting
Development of systems to collect and report financial information
Analyzing this same information Making finance-related recommendations to assist
management decision making
Accounting (continued …)
Centralized accounting systems
Financial management system that collects accounting data from an individual hotel(s), then combines and analyzes the data at a central site
Prevails in chain-operated or multiproperty hotel companies Company will likely employ C.P.A. for data analysis
Decentralized accounting systems
Financial management system that collects accounting data from an individual hotel site and combines and analyzes that data at the same site.
G.M. and controller have larger role in preparing financial documents
Revenue Forecasting: Rooms Revenue
Rooms revenue forecast should include at minimum:
Rooms available for forecasted period Estimated rooms for the period Estimated occupancy rate for period Total rooms sold / total rooms available = Occupancy percent (%) Estimated ADR (average daily rate) for period - Total room revenue / total number of rooms sold = ADR RevPar (revenue per available room) for forecasted period - Occupancy % X ADR = RevPar
Revenue Forecasting: Food & Beverage Revenue
Number of guest rooms sold directly impacts amount of F&B sales volume
Controller will forecast sales generated from: - Room service - Banquets - Meeting room F&B revenue - Audio visual equipment rental - Service charges
Revenue Forecasting: Other Revenue
Typical examples of other revenue sources include:
Pay-per-view movies Parking charges Internet access charges Gift shop sales of newspaper / cigarettes / candy / lotions / pop / etc Telephone (local / long distance calling) Guest laundry Coat check fees Golf fees Tennis fees Health club usage fees Pool fees
Budgeting
Important function of budget
Allowing management to anticipate / operate for future business conditions
Providing communication channel whereby hotel objectives are passed to various departments
Encouraging department managers who have participated in budget preparation to establish own operating objectives / evaluation techniques / tools
Providing G.M. with reasonable estimates of future expense levels and serving as tool for determining future room rates
Helping controller & G.M. to periodically evaluate hotel and its progress toward financial objectives
Budgeting (continued ….)
Encompass relatively lengthy period, generally 2-5 years or more
Long-range Useful for long-term planning, considering
budgets wisdom of debt financing / refinancing and
scheduling of capital expenditures Must be produced by individual hotels and
Annual submitted to central office for review in large, multiunit hotel companies
budgets Developed to coincide with calendar year
Helps determine whether maintaining progress toward goals developed in annual budget
Monthly
Great use for seasonal hotel
budgets Refer to Figure 5.1 (Waldo hotel property operations & maintenance department operating budget for January)
Financial Statements: Income Statement
Key financial documents
Income statement Balance sheet Cash flow statement
Income statement
Known as profit and loss statement Lists hotel ’s revenues, expenses, GOP, & fixed charges for specific time (month, fiscal quarter, or year) In no case should this period exceed middle of next
reporting period
Financial Statements: Income Statement
Figure 5.2: Income Statement Information
This period ’s actual
Revenues
Less
Direct operating expense
Equals
Department operating income
Less
Overhead (undistributed) expense
Equals
Net income (GOP)
Less
Fixed expense
Equals
Income before taxes
G.M. can answer: How did hotel perform during this period?
Financial Statements: Income Statement
Figure 5.3: Tricolumned Income Statement
This
This
Last year
period ’s
period ’s
same period
Less Direct operating expense Equals
Department operating income Less
Overhead (undistributed) expense Equals
Net income (GOP) Less
Fixed expense Equals
Income before taxes
G.M. can answer: Hotel performance during this period? Hotel performance compared with performance estimate (budget)?
Where did estimates vary significantly? How did hotel perform compared with same period last year?
Where were significant changes from last year evident?
Financial Statements: Income Statement
Functions of balance sheet
Provides a point-in-time statement of overall financial position of hotel “Snapshot” of financial health of hotel
Capture the financial condition of hotel on day it is produced Not telling how profitable the hotel was in given accounting
period
Limitation of balance sheet
Of all assets, none consider relative value / worth of staff, including the G.M, actually operating hotel
Value of experienced, well-trained staff is not quantified.
Financial Statements: Balance Sheet
Figure 5.9: Accounts receivable aging report
Accounts receivable
Inventories on-hand
Prepaid expenses
Total assets $160,000 Property and equipment
(Less accumulated depreciation)
Net property and equipment 6,500,000 Total assets
Financial Statements: Balance Sheet
Figure 5.9: Accounts receivable aging report (continued ….)
Liabilities and Owners ’ equity
Current liabilities Accounts payable
Wages payable
Total current liabilities
Long-term liabilities Mortgage payable
Total liabilities
Owners ’ equity 260,000 Total liabilities and owners ’ equity
Financial Statements: Statement of Cash Flows
It is critical that the hotel not only is profitable, but also that it maintains solvency.
It shows cash effects of hotel ’s operating, investing, and financing activities.
Statement of cash flows can answer to the following:
How much cash was provided by hotel ’s operation during accounting period? What was hotel ’s level of capital expenditure for that period?
How much long-term debt did hotel commit to during that period?
Will cash be sufficient for next few weeks or will short-term financing be required?
Daily Operating Statistics: Manager ’s Daily Sales Report
Controller ’s office should provide G.M. with a timely recap of prior day ’s rooms, F&B & other
“Daily”
revenues. Prepared from data supplied nightly by PMS.
Daily includes the following:
For room
- Number of rooms available for sale / number of rooms sold / occupancy rate / ADR / RevPar / Other room revenue info
F&B
- Restaurant sales / bar & lounge sales / meeting room rentals / banquet sales / other F& B revenue
For other income
- Telephone revenue / in-room movie revenue / no-show billings / other income
The more detail you desire, the longer the Daily !
Daily Operating Statistics: Detailed Room Revenue Statistics
Documentation & verification of night auditor ’s report is an important function of controller ’s office.
Night auditor report provides wealth of info on room sales.
Detailed room revenue report include:
Rooms available Total rooms occupied Rooms occupied by guest type Occupancy percent Total ADR ADR by guest type Total RevPar
Daily Operating Statistics: Adjustments & allowances
Reduction in sales revenue credited to guests Allowance &
because of errors in properly recording sales or to adjustments
appease a guest for property shortcomings. Figure 5.7: Adjustment Voucher
ADJUSTMENT N O
ROOM OR ACCT.NO.
SIGNATURE 11-09-0199 (7)
Daily Operating Statistics:
Adjustments & allowances (continued ….)
Importance of completion of allowance & adjustment voucher
Employee error in charge
- Employee training program, cash sales systems, or guest service techniques
Hotel-related problems
- Equipment inspection programs, guest service training
Guest-related problems
- Total monthly Allowance & Adjustments/ total room revenue = Room
allowance & adjustment % - This percentage varies based on hotel age, quality of staff & training programs, & type of guest typically served
Internal Controls: Cash
Credit card-related techniques to defraud guests
Changing guest ’s credit cards for items not purchased, then keeping money from erroneous charge
Changing totals on credit card changes after guest has left or imprinting additional credit card charges and pocketing cash difference
Mis-adding legitimate charges to create higher-than-appropriate total, with intent to keep the overcharge.
Charging higher-than-authorized prices for products/services, recording proper price, and keeping the overcharge
Giving/selling/credit card numbers to unauthorized individuals outside hotel
Internal Controls: Cash
Methods of evaluating cash control systems
Cashier training programs Sales revenue recording systems Cash overage/shortage monitoring systems Enforcement of employee disciplinary procedures for
noncompliance
Internal Control: Accounts Receivable
Accounts receivable (AR): money owed to hotel because of sales
Facility Engineering & Maintenance made on credit
Direct bill: an arrangement whereby a guest is allowed to purchase hotel services and products on credit Facility Engineering & Maintenance
Guest seeking credit would complete a “Direct Bill Application ” (Refer to Figure 5. 8)
Internal Control: Accounts Receivable
Controllers ’ jobs to establish:
which guests are allowed to purchase goods/services on credit.
how promptly those guests will receive bills. what is total amount owed to hotel and how long have those
monies have been owed.
A controller together with a G.M. should establish credit policies that maximize number of guests doing business with hotel, yet minimize hotel Facility Engineering & Maintenance