Hospitality Industry: Introduction

Hospitality industry consists of companies and businesses that owns, manage and run temporary housing facilities, it also includes motels and hotels.

The Organization within the Industry: A leading company “Accor”

I have chosen ACCOR, which is the world's leading company in hospitality industry. Accor is (Accor, 2008) a European leader in hospitality industry and it operates in 100 countries having more than 150,000 employees. Accor is serving its clients, guests and customers for from more than 40 years in two core fields of its business operations: Hotels, with the leading brands Sofitel, Pullman, MGallery, Novotel, Mercure, Suitehotel, Ibis, All Seasons, Etap Hotel, Formule 1, hotelF1 and Motel 6 brands. Accor has more than 4,000 hotels and approximately 500,000 rooms in 90 countries, along with the strategically related activities, such as Lenôtre; and Services (Accor, 2008).

Accor is a very big company operating its business into two different areas hotels and services. Accor is not only leading in lodging but also in hospitality industry. Accor Hotel division consists of around 4000 hotels and Accor Services division is consisting of casinos, travel agencies, voucher companies and restaurants having 13 million corporate clients. (Gomez, Marshall, Patel & Tam, 2005)

The Innovative Approach: the company with regular innovation

To centralize the overall operations of the company it introduced a number of new technological methods, this reflects the innovative thinking approach of management of the Accor. Which contributed very effectively in the performance progress of the company which may be listed as under: (Gomez, Marshall, Patel & Tam, 2005)

TARS On Line - Central reservation system linked to multiple distribution channels and offering yield management tools.
Accortel - Real time occupancy tracking which centralizes hotel sales operations
AccorShop - E-procurement for access to 45 biggest suppliers.
AccorPrint – E-procurement for company printing needs offering centralized ordering and Accor - wide cost efficiencies.
Grand Back - Back office data consolidation allowing managers to benchmark against peer hotels throughout Accor
Capex Online - Application to track and control capital budgets and cash flows.
Front Office Light Services (FOLS) - Centralizes and streamlines IT tasks.
Accor Sales Application (ASA) - Business to business CRM tool which interfaces with Accor databases. (Gomez, Marshall, Patel & Tam, 2005)

The Need of the New Technology: why the new system developed?

Being a leading company Accor needed a system which helps the organization to coordinate, control, process and manage the organizational activities. Accor business is full of activities as Reservation, Revenue Management, Distribution and Marketing. (Warrior, Personal Communication)

The need of this system (TARS) can also be determined as (Accor, 2002):

Managing company's partners were becoming difficult as its operations were spreading.
Customer customised policy was being implemented in the organization.
Creation of innovation in the electronic reservation system.
Information of availability of room within the whole network was mandatory.
Improved system with ease of access.
Centralization of the company's information resources.
Simplification in the operations of the organization.
Ease of access to the data within whole organization. (Accor, 2002)

The new Technology: TARS (Travel Accor Reservation System)

To cope effectively with all the areas stated above a single integrated system was designed, that is still running as backbone of the Accor named TARS Travel Accor Reservation System (Egle, Personal Communication). It is good example of incremental change in organization.

TARS is the system which serves all sectors of needs for the organization. “The Travel Accor Reservation System (TARS) runs continuously, 24x7x365, dealing with all time zones, and booking on average 20,000 hotel reservations daily. It is critically important to have the highest levels of availability and security for its IT solution since it is the company's backbone.” (Eric Sanavio, n.d.)

The Structure of the system: How it works?

Source: (Accor, 2002)

Source: (Accor, 2002)

Challenges: the difficulties in adoption of the technology and how company worked out with challenges?

There are also some difficulties were faced by the company regarding the new system TARS. One of the big challenges was not to disturb the routine work of the hotels (Egle, Personal Communication). Because hotel industry works 24 hours and 7 days a week, so it found difficult to implement the new system without disturbance in the business day routine. The new computers, servers, printers and other devices were purchased as to fulfil the equipment need for the system, a big capital expenditure. Employees training and skill building are the significant areas ho human resource management. Employees were given full training for the normal operations on the system. The company invested in employee engagement program to make it successful and beneficial for the company (Accor Services, 2008).

Company Strategies: the value chain processes

Accor adopted different strategies for new technology and for its normal operations with the effective cost control, means with cost leadership strategy. As this strategy helped the company to maintain the rates low for customers. This reflects the economic sensitivity of the company. The company does not believe in wide complex capital intensive structure for its operations.

Accor's partnership strategy has main focus on increase in market share through profitability, sharing sources to achieve cost efficiencies, enhancing brand loyalty and recognition and creation of value for its customers by introducing new products and services. Accor's partnerships are the following companies and services: (Gomez, Marshall, Patel & Tam, 2005)

Accor and France's national railway created a Train + Hotel offering.
Europcar offers special rates to Accor guest online.
Air France also offers special promotions for Accor and a very strong link to their frequent flyer program.
A number of French cell phone operators offer WAP-enabled booking of Accor hotels by cell phones.
American Express offers a co-branded (Accor, 2008) complement corporate card with Accor.
Accor also created a wide range of promotions with the Eurotunnel for three hotels around the Calais train station. (Gomez, Marshall, Patel & Tam, 2005)

Enhancing the Value Chain: Plug & Book Service program

Accor also promoted TARS with its distribution system by introducing Plug & Book service, (Accor Hospitality, 2008) to provide a permanent access of rates and availability of rooms in Accor Hotels. Which provided simplicity and ease by automating the reservation process and providing access to rates. This Plug & Book service provide (Accor Hospitality, 2008):

Direct access to TARS system
Real time access to Rates and Availability
Assuring the accuracy of the availability shown by the system
Fast spread of bookings to the hotels in Accor group

Human Resources: employee motivation and reward program

Human Resource is the main key function which helps managers to keep their subordinates on track and well engaged with the jobs. Human resource management provide an opportunity to the management of a business to create coordination between the people and departments to achieve common goals of the organization (Perrin, 2003).

Accor adopted different projects to enhance motivation in employees to improve their skill over new technology introduced within the organization and for its overall operations. Making the flow of information clear and effective helped to cope better with the new technology. As described earlier that Accor has different brands on the globe with distinctive features, so, (Accor, 2002) it was ensured and monitored the contribution of each brand regarding the introduction of new system.

To achieve human resource objective Accor management introduced many employee oriented schemes, to reward employees. This increased job satisfaction among the employees and they contributed well in the adoption process of the technology. It had been in the normal practice of the company to emphasize on human resource factor. That's why Accor considered as a champion in the industry related human resources (Cathy & Judy 2000).

In 2008 one of the big studies have been done by Accor researching on the employees work and life balance including job appraisal and employee engagement in work matters (Accor Services, 2008). Findings of the study showed that around 73% of employees responded that they found it easy to balance between work and life (Accor Services, n.d). About the job satisfaction different views of the employees were recorded.

Advantages of the Technology: benefits for the Accor

Implementation of TARS has given a number of long term benefits to the organization. These advantages include the increase in overall market value of the company. Because by the implementation of this system its performance increased this led to maximization of profits for the company.

The introduction and implementation of TARS achieved a number of advantages for the company, which may include:

The hotels have been able accessed anytime from anywhere.
Information became more reliable about the availability of rooms.
If the hotel is fully booked, it became possible to book-out (transfer) the guest which are overbooked to another hotel in the area in very less time.
Online reservation ratio increased.
It made the hotels easy to use the search tools.
Reservation in available 24 hours a day, 7 days a week.

Optimization of the operational area which is in benefit of each hotel (Accor, 2002) that consists of:

How to sell rooms:
At a good price
At the right time
To the right client
In the right hotel

Technology for Innovation: new software developed for improving operations

Innovation is not only inventing new products, but also includes the invention and modification in the operations of the business. It is needed not only to survive in the industry but also for the growth and development of the business (Erikson, n.d).

The introduction of TARS led the innovation in the system by involving (Source: Website, m-travel.com) “Maporama” an application which gives online location details of the nearest hotels and also connect to the reservation system to make a booking. By a single click it will give all the nearest Accor hotels details and also guide to the reservation system. "Maporama is proud to announce Accor Hotels as a new customer," said Laurent Vermot-Gauchy, Maporama CEO & President. "The hotel locator facility we have integrated into www.Accorhotels.com implements Maporama's most advanced technologies, providing an exceptional user experience and is an excellent demonstration of the tremendous added value that Maporama's know-how brings to customers."

Conclusion: overview and recommendations

The pride of hospitality industry is the service excellence to guests. Accor has the flag of this factor which can be seen in the operations of its world's leading brands mentioned earlier. For the successful implementation of new technology it is needed to ensure the real needs of the business for that particular technology. Without determining the needs, the results of the application of new technology could be adverse. Managerial expertise is the key to gain success in the introduction of new technology.

For the smooth implementation of technology the extent of adoption of changes should be specified. Unnecessary push may lead to conflict between managers and subordinates. Successful flow of communication is essential to deliver the ideas and issues related to the technology adoption.

In hotel industry, as flow of work must not be influenced as it is a service based industry directly related to customer expectation about the care and respect. Before implementing the technology extra staff should be available to share the burden of the work. Building the skill to adopt change in the employees is also an important factor. Accor business is not limited to its working boundary; it works with the integration of outside business partners like travel agents, travel companies, airline companies and different website operators. Accor should ensure the understanding of the system TARS in theoretical as well as in practical for its stakeholders. A planned approach towards the implementation of new system enhances the success of the goals behind the project. Assistance to employees as well as to stakeholders should be provided any time when needed. For the long term benefits by making the improvement in the system is the check and balance or control over the operations of the organization.

Accor should maintain a well organized control over the system to enhance the contribution of new technology.

References:

Accor (2008), ‘Accor in on Course', Annual Report.
Accor Hospitality (2008), ‘Plug & Book with us', Accor CRS Direct Connection Interface, XML Open Travel Specifications.
Accor (2008), Registration Document
Egle, B., Front of House Manager, All Seasons Hotel, London. Personal Discussion
Pang, T., Operations Manager, All Seasons Hotel, London. Personal Discussion
Cathy, A. & Judy, A., (2000), ‘Best Practices in Human Resources', School of Hotel Administration, Comell University.
Chaffey, D., Bocij, P., Greasley, A. & Hickie, S. (2005), ‘Business Information Systems: Technology, Development and Management for the E-Business'.
Gomez, B., Marshall, K., Patel, P., Schiller, H. & Tam, A. (2005), The Center of Hospitality Research, Cornell University.
Erikson, G. (2000), ‘Innovation Beyond Ideas', Vol. 1, n.3.
Improving Availability for Online Reservations, ONLINE at http://www.sun.com/customers/servers/accor.xml accessed on 16-02-10

Maporama Chosen for Accor Hotel Website ONLINE at http://www.m-travel.com/news/2002/11/maporama_chosen.html accessed on 13-02-10.

Perrin, T. (2003), ‘Working Today, Understanding what drives employee engagement'. Eric Sanavio, Data Center Director at Accor Hotels.

Bibliography:

Hayes, J (2006), The Theory and Practice of Change Management
John, M. (2000), Project Management for Business and Technology Principles and Practice
Palmer, I, Richard, D. & Akin, G (2008) Managing Organizational Change: A multiple perspective approach
Thompson, L. & Martin, F. (2005) Strategic Management: Awareness, Analysis and Change
Gina, R. Reservation Supervisor, Personal Discussion, All Seasons Hotel, London

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