Discuss about the Management Systems for Strategy and Implementation.
The main objective of this report is to analyze the case study of StayTogether hotel chain and suggest suitable recommendations for mitigating the management issues of the company. Ten different hotel chains have decided to merge together to form a single large hotel chain. The main objective of this merger is to operate as a single chain and use only one specific website for online booking purposes. The instant online booking websites provide rooms to the customers at a much cheaper rate. As a result, although the customer count in the hotels is increasing, there are losses in the service expenses and hence, the corporate images of the hotels are slowly getting watered down (Kappelman et al., 2013). In order to solve the issue, the merger hotel chain looks to implement its own suitable policies and guidelines.
In this report, the new proposed policies of the company have been analysed and recommendations have been provided for maximizing the benefits from these policies for the company.
With the recent development of websites and mobile apps for booking hotels instantly like booking.com, hotels.com and others, the hotel business is getting significantly less amount of actual profits. The instant online booking websites provide rooms to the customers at a much cheaper rate (McKeen, & Smith, 2015). As a result, although the customer count in the hotels is increasing, there are losses in the service expenses and hence, the corporate images of the hotels are slowly getting watered down. Hence, ten popular hotel chains have decided to merge into a single chain named “StayTogether”. Another main agenda of this merger is to operate as a single chain and use only one specific website for online booking purposes. However, in order to ensure the chain does not suffer any losses, the management team has decided with introduction of some specific policies regarding the use of the online website. These policies are as follows.
According to the policies, there will be only one online booking website and there will be fixed prices all the year round. However, the problem with these policies is that there are no particular benefits for the customers (Zardini, Rossignoli & Ricciardi, 2016). Moreover, due to fixed prices of the rooms, there will be no discounts for the customers. On the other hand, the customers seek rooms with special discounts or low prices. Hence, the management team has decided to implement four new services that will benefit the customers who will book rooms in the StayTogether hotel. The new services are as follows.
Customer Loyalty Scheme – The management team has planned this scheme in order to earn loyalty from the customers i.e. provide special services to customers so that they will avail their services again in the future. According to this scheme, if some customers visit this hotel chain on a regular basis, they will be offered with free transportation from the airport or railway station. Moreover, if these customers prefer to bring their own cars, they will be provided with free parking spaces. Finally, these customers can also receive free nights at the hotel based on loyalty points gathered by them. These offers will encourage the customers to book rooms in this hotel chain more frequently.
Buffet Meal System – The management team has also decided to change the existing restaurant model to reduce extra expenses, gain more profit and provide a more convenient system for the customers. In the existing restaurant system, the company has to recruit waiters to serve the dishes to the customers. As a result, the payments to the waiters are extra expenses for the company. Moreover, there is a huge wastage of food as many customers are unable to complete the dishes served to them. Hence, the new plan is to implement buffet meal system for the customers. In this system, customers will be able to choose their preferred dishes and can take only that quantity that they will be able to eat without wastage of food. Moreover, there will be no waiters required for serving the dishes. Another benefit of this system will be integration of the food prices along with the room prices. Hence, the customers will not be required to pay further for the food. However, for those who do not prefer buffet system, there will be exclusive on-site restaurant and the charges for eating in this restaurant will be extra.
Special Rebates for Airline Passengers – Another change the management team is eager to implement is offering certain rebates to the customers if they avail services of some particular airlines. The company is interested is forming partnerships with these airlines where both parties can benefit from increasing amount of the passengers / customers. According to the proposed plan, if a customer avails the service of one of the selected airlines, he will receive a rebate voucher for StayTogether hotel chain, which he can use for obtaining rebates in room fare or meal price. It is expected that this will increase the passengers in these airlines as well as customers in the hotel chain.
Charity Events – The company is also planning to donate money some charity events nominated by the customers themselves. According to this plan, a regular customer will be able to nominate a charity to which, StayTogether will pay 1% of the total billable amount. With increasing number of customers, there will be more nominations and the interested customers will avail the services of the hotel more frequently in order to grant donations to their selected charity events.
From the analysis of the proposed system, it can be said that there may be several IT and IS issues that the company may face. Some of these issues are discussed as follows.
Internet Security – Cyber security will be critical test for the organization once the proposed app turns out to be completely operational. For booking purposes, the clients should enter their personal data in the application and subsequently, the application will be the easy target for various hackers and unethical programmers (Gattorna, 2015). Consequently, the protection of the clients’ data will be lost unless adequate cyber safety efforts are taken.
App Developmental Stage – According to the proposed arrange, the organization will build up a web based booking application for Android and iOS clients. In any case, advancement of an application is not a simple assignment because of the way that the improvement requires development of various stages of a software development life cycle including α-version, β-version, demo version and others (Ferrero & Sison, 2014). Indeed, even after the full form is finished, there stay a few bugs and mistakes that are to be expelled utilizing new fixes. Once more, the UI must be appealing and straightforward for the clients. Henceforth, the organization will confront critical test in building up the proposed new application.
Customer Service (Information System) – The organization will likewise confront noteworthy test if there is no customer service administration to address the inquiries of the client. A decent client service administration is a fundamental segment of an effective information system framework.
Management of Data and Information – There may be a few issues emerging in information administration if there is no appropriate information management framework. With expanding clients, there will be convergence of an enormous measure of information. Manual operations will not have the capacity to deal with every one of the information precisely (Kock, 2014). Henceforth, a computerized information administration framework is vital or the organization will confront critical test in dealing with all the client data.
With the proposed new technical setup, the company can venture into new business opportunities as well. The possible business opportunities are the following.
New Restaurant Chain – StayTogether hotel chain can open a new restaurant chain that can be an additional source of revenue for the company. The hotel chain already has restaurants attached to the hotel apartments. However, there can be a new chain for exclusively restaurants where customers can get fast food as well as casual and full meals. The restaurant chain can be made specialized like Italian restaurant chain, Chinese restaurant chain, Mexican restaurant chain and others. With sufficient brand value, there will be no time till influx of customers start in the restaurant chain.
Personalized Automated Tour Guide – The company can also venture into business of personalized automated tour guide in order to benefit the tourists that avail the services of the hotel chain. This can be another source of income for the company as significant revenues can be generated from the sale of the automated tour guides to the tourists.
Conclusion
In this report, the new proposed policies of the company have been analysed and recommendations have been provided for maximizing the benefits from these policies for the company. According to the new proposed policies of the management team, there will be only one online booking website and there will be fixed prices all the year round. However, the problem with these policies is that there are no particular benefits for the customers. Moreover, due to fixed prices of the rooms, there will be no discounts for the customers. On the other hand, the customers seek rooms with special discounts or low prices. Hence, the management team has decided to implement four new services that will benefit the customers who will book rooms in the StayTogether hotel. The management team has planned a customer loyalty scheme in order to earn loyalty from the customers i.e. provide special services to customers so that they will avail their services again in the future. The management team has also decided to change the existing restaurant model to reduce extra expenses, gain more profit and provide a more convenient system for the customers. Another change the management team is eager to implement is offering certain rebates to the customers if they avail services of some particular airlines. The company is interested is forming partnerships with these airlines where both parties can benefit from increasing amount of the passengers / customers. Finally, the company is also planning to donate money some charity events nominated by the customers themselves. According to this plan, a regular customer will be able to nominate a charity to which, StayTogether will pay 1% of the total billable amount.
Based on the analysis of the company’s new schemes, the following recommendations can be provided.
Customer Benefit – The company must provide certain benefits to the customers in order to earn their trust and loyalty. According to the new policies of the company, there will be only one online booking website and there will be fixed prices all the year round. However, the problem with these policies is that there are no particular benefits for the customers. Moreover, due to fixed prices of the rooms, there will be no discounts for the customers. Hence, the company must emphasize on providing other benefits to the customers.
Strict Policy – In the case of revenue and profit, company must be strict with their policies without harming the customers’ interests in any way. It is a habit of most of the customers to bargain with the service provider and lower the actual prices of the services. As a result, if the prices are actually lowered, the company will encounter significant losses in the business. Hence, the company should implement strict pricing policy that can only be lowered for some loyal customers based on their loyalty points or some event specific discounts.
Cyber Security – Appropriate cyber safety efforts must be taken to protect the personal data of the clients. Cyber security will be critical test for the organization once the proposed application turns out to be completely operational. For booking purposes, the clients should enter their personal data in the application and subsequently, the application will be the easy target for various hackers and unethical programmers. Consequently, the protection of the clients’ data will be lost unless adequate cyber safety efforts are taken.
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