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Presentation on theme: "UNDERSTANDING HOTEL ORGANIZATIONS"— Presentation transcript:


2 Contents Organizational Chart Line and Staff Functions Business Forms
Revenue Sources Profit and Costs Contents

3 General manager Front Office Front Desk Bell service Valet Concierge Night Audit Maintenance Administration HOUSEKEEPING Floor Attendants Laundry Food Beverage Restaurant/Bar Banquets Catering Room Service Human Resources Convention Sales RoomSales

4 Like most service related organizations, hotels are divided between LINE functions and STAFF functions

5 Line Functions Line functions are the tasks assigned to employees that bring them in regular contact with guests. Line operations in a hotel are the Rooms Division & Food and Beverage Division. Line employees are hands-on participants in the assembly and delivery of the hotel’s services. Line = Revenue

6 ROOMS DEPARTMENT Performs the lodging function of a hotel.
Includes Front Office, Reservations Uniformed Services and Housekeeping Tasks performed: Receive reservation Receive guests Assign rooms to guests Maintain status of room (available or vacant?) Receive mail / phone messages for guests Maintain security & cleanliness in rooms and public areas Answer guests’ questions Close coordination needed by all subunits

Provide food and beverage for guests May include coffee shop, restaurant, poolside snack bar, room service, banquet, function rooms, lobby bar, nightclub / disco, room service Provides banquet and catering services for events in the hotel

8 Food and Beverage Department cont.
Consists of kitchen (food preparation) and F&B service Contains individual F&B outlets – restaurants and coffee shop etc (each managed by a manager) Full service hotels have convention and catering subunit Stewarding subunit does the purchasing,cleaning and washing, expediting and arranging facilities for food and beverage

9 OTHER LINE FUNCTIONS Telecommunications Concessions, rentals, and commissions Fitness and recreation facilities

10 Example: Engineering, security, human resources, marketing, accounting
Staff Functions Staff functions are those behind the scenes activities that support the line functions and have little contact with guests. Example: Engineering, security, human resources, marketing, accounting Staff = Cost

11 Sales and Marketing Department
Individual sales manager in charge of corporate accounts, conventions, tour and travel markets. Low intradepartmental interdependence. Human Resources Department Consists of employee recruitment, benefits administration, training subunits Accounting Department Prepares payroll, manages accounts receivables, accounts payables, handles purchases and cost controls, store room operations, night audits Engineering and Security Repairs, maintenance, guest and property security

12 Hotel Functional Organizational Design
Engineering Reservations Room status repair Housekeeping Front Office Clean room Concierge / Bellhop Laundry


14 Lodging Business Forms
The five basic lodging business forms: Owner operated Owner managed Independent Franchised Management Contract Lodging Business Forms

15 Understood to have been the first type of lodging management association
Hotel is run by an owner and the owner’s family Currently popular Bed and Breakfast hotel is considered owner operated Owner Operated

16 The owner has hired additional (non- family) personnel to help with the running of the property
The overall management is in the hands of the owner, but day to day operations can be in the hands of others Owner Managed

17 The owner has no role or management in day to day operations
An independent group of managers are responsible to the owner for the hotel’s performance The hotel is not chain affiliated Independent

18 Independently owned hotels that affiliate themselves with a chain
The chain provides standard operating procedures and guidelines to maintain a consistent level of quality and service The chain has limited control Franchised

19 Franchise Costs/Benefits
You can expect to pay in the range of $90,000 to $150,000 in initial fees for a first-class hotel franchise like Hilton‘s Homewood Suites. Additional costs typically include royalty fees, reservation fees, marketing fees, frequent traveler fees, and miscellaneous charges for items like training or commissions. These numbers are calculated assuming a 300-room hotel with 60% occupancy for the first year, so actual costs can vary. Total costs over ten years can run as high as $10 million or more. Franchise Costs/Benefits

20 Franchise Costs/Benefits
Those with the best relationships with their franchisors reported gross operating profits per room (GOPAR) of $12,400, which translates to over $3.2 million per year in a 300 room hotel. Top Franchises: Marriott (Ritz Carlton), Hilton, Four Seasons, Park Plaza, Holiday Inn Franchise Costs/Benefits

21 Independently owned hotels that affiliate themselves with a chain
The chain maintains a high level of control as the chain operates the hotel on the owner’s behalf Many hotel companies offer both franchises and management contracts. Management fees are paid as a % of revenues Management Contract