INTRODUCTION TO HOSPITALITY

AND TOURISM

Chapter 3

Room Division Operations

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 After reading and studying this chapter you should be
able to:
1. Outline the duties and responsibilities of key executives
and department heads.
2. Draw an organizational chart of the rooms division of a
hotel and identify the Executive Committee members.
3. Describe the main functions of the rooms division
departments.
4. Describe property management systems and discuss
yield management.
5. Calculate occupancy percentages, average daily rates,
and actual percentage of potential rooms revenue.
6. Outline the importance of the reservations and guest
services functions.
7. List the complexities and challenges of the concierge,
housekeeping, and security/loss prevention 2
departments.
THE FUNCTIONS AND DEPARTMENTS OF
A HOTEL

 The primary function of a hotel is to provide

lodging accommodations.

 Hotels exist to provide a service and to generate a

profit for the owners.

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A HOTEL IS COMPRISED OF SEVERAL BUSINESS
OR REVENUE CENTERS AND COST CENTERS.

 In business, a revenue centre is a division that

gains revenue from product sales or service
provided. The manager in revenue centre is
accountable for revenue only.

 A cost center is often a department within a

company. The manager and employees of a cost
center are responsible for its costs but are not
responsible for revenues or investment decisions.
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 MANAGEMENT STRUCTURE
 Management structure differs among larger,
midscale, and smaller properties.
 The midscale and smaller properties are less
complex in their management structures than
are the larger ones.
 A small property may not have a director of
human resources, but each department head will
have general day-to-day operating
responsibilities for the human resources function.

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6
 ROLE OF THE HOTEL GENERAL MANAGER
(GM)
 The hotel GM must ensure a reasonable return
on investment, keep guests satisfied, and keep
employees happy.
 The GM not only focuses on leading and
operating the hotel departments but also on
aspects of the infrastructure, from room
atmosphere to security.
 The GM is ultimately responsible for the
performance of the hotel and the employees.

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 ROLE OF THE HOTEL GENERAL MANAGER
(GM)
 The GM is the leader of the hotel.
 As such, she or he is held accountable for the
hotel’s level of profitability by the corporation or
owners.
 Effective GMs hire the best people and set the
tone—a structure of excellence.
 GMs must also be familiar with the cultures of
guests staying in the hotel and the employees
working in the hotel.

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 THE EXECUTIVE COMMITTEE

 The Executive Committee is comprised of

directors of the following departments:

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 THE EXECUTIVE COMMITTEE
 Executive Committee meetings usually last 1 to 2
hours, once a week.

 Typical topics of discussion will focus on

occupancy percentage, Total Quality
Management, forecasts, guest and employee
satisfaction, training, etc.

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THE DEPARTMENTS

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 ROOMS DIVISION
 The rooms division director is held responsible by
the GM for the efficient and effective leadership
and operation of all the rooms division
departments.
 The rooms division is comprised of the front
office, reservations, housekeeping, concierge,
guest service, security, and communications.
 Main concerns of the department are financial
performance, employee satisfaction, guest
satisfaction, guest services, guest relations,
security, and gift shop.
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 FRONT OFFICE
 The main duty of the Front Office manager is to
enhance guest service by developing services to
meet guest’s needs.
 He/she supervises Guest Service Associates
(GSAs), who interact directly with the guest
during check-in, check out, etc.
The main functions of the front office are:
 (a) to sell rooms,

 (b) to maintain balanced accounts,

 (c) to offer services such as handling mail, faxes,

messages, and local and hotel information.
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GUEST CYCLE

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 YIELD MANAGEMENT IN FRONT OFFICE
 Yield management, or revenue management, is
the process by which sales of a limited quantity of
goods, such as hotel rooms, airline seats,
apartment leasing, rental cars, or etc. are
managed in order to maximize profits. Successful
yield management focuses on selling the product
in such a manner that is timely, price
competitive, and directed towards the right
subset of customers.
 The main idea of YM is to change prices
depending on demand.
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 CITY LEDGER
 In hotel accounting, the city ledger is the
collection of accounts belonging to non-registered
guests. This is distinct from the
transient ledger (or front-office ledger, or
guest ledger), which is the collection of accounts
receivable for guests who are currently
registered.

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 CITY LEDGER
 A city ledger, also called a house ledger, is a
hotel's accounting method for tracking non-guest
transactions. Hotel accounting is divided into
front-office and back-office operations. The front-
office typically deals with registered guests and
records their transactions to the guest ledger.
Money that the hotel handles that is not
attributable to a currently registered guest
becomes part of the city ledger and is handled by
the accounting department in the back office.

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 NIGHT AUDITOR
 A hotel must balance its accounts on a daily basis.
 At approximately 1:00 a.m., when the hotel has
“quieted” down, the night auditor begins the task of
balancing the guest accounts receivable.
 The daily report contains a key operation ratio—
Room Occupancy Percentage (ROP).
 This is calculated by dividing the number of rooms
occupied by the number of rooms available.

The occupancy rate of a hotel is expressed as a percentage. So,

for example, if a hotel has 100 rooms available to be sold and
100 of those rooms are occupied, the occupancy rate would be
100 percent. If the same hotel had 60 rooms occupied, the
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occupancy rate would be 60 percent.
 NIGHT AUDITOR

 The Average Daily Rate (ADR) is, together with the

ROP, one of the key operating ratios that indicates
the hotel’s performance.

 ADR is calculated by dividing the total of room

revenue by the total number of rooms sold.

 Example of How to Use the Average Daily Rate (ADR)

If a hotel has $50,000 in room revenue and 500 rooms

sold, the ADR would be $100. Rooms used for in-house
use, such as those set aside for hotel employees and
complimentary ones are excluded from the calculation 19
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 REVENUE MANAGEMENT
 Revenue management is used to maximize room
revenue at the hotel.
 It is based on the economics of supply and
demand, which means that prices rise when
demand is strong and drop when demand is
weak.
 Although management would like to sell every
room at the highest rack rate, this is not possible.

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 REVENUE MANAGEMENT
 Conventions, groups, and organizations are often
granted a reduced room rate as an incentive to
stay at a particular property.
 Revenue management will monitor reservations
and based on previous trends and current
demand, will determine the number and type of
rooms to sell at what price to obtain the
maximum possible revenue.

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ROOM BOOKING

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 REVENUE MANAGEMENT
Revenue per available room, or REV PAR, was
developed by Smith Travel Research.

 It is calculated by dividing room revenue by the

number of rooms available.

 For example, if room sales are $50,000 in one day for

a hotel with 400 available rooms, then the REV PAR
formula is $50,000 divided by 400, or a REV PAR of
$125.

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 REVENUE MANAGEMENT

Hotels use REV PAR to see how they are doing

compared to their competitive set of hotels.

Hotel operators use REV PAR as an indicator of a

hotel’s revenue management program.

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 ENERGY MANAGEMENT SYSTEMS

 Technology is used to extend guest in-room comfort by

means of an energy management system. Passive
infrared motion sensors and door switches can reduce
energy consumption by 30 percent or more by
automatically switching off lights and air-conditioning,
thus saving energy when the guest is out of the room.

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 ENERGY MANAGEMENT SYSTEMS
Additional features include the following:

 Room occupancy status reporting

 Automatic lighting control

 Minibar access reporting

 Smoke detector alarm reporting

 Central electronic lock control

 Guest control amenities

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 CALL ACCOUNTING SYSTEMS
 Call accounting systems (CAS) track guest room
phone charges. Software packages can be used to
monitor where calls are being made and from which
phones on the property. To track this information, the
CAS must work in conjunction with the PBX
(telephone) (Private Branch Exchange) and the PMS.
Call accounting systems today can be used to offer
different rates for local guest calls and long-distance
guest calls. The CAS can even be used to offer
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discounted calling during off-peak hours at the hotel.
 GUEST RESERVATION SYSTEMS
 Airlines were the first industry to start using
global distribution systems (GDS) for
reservations. Global distribution systems are
electronic markets for travel, hotel, car rental,
and attraction bookings.

 A central reservation system (CRS) houses

the electronic database in the central
reservation office (CRO).

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 GUEST RESERVATION SYSTEMS
 Hotels provide rates and availability information
to the CRO, usually by data communication lines
automatically updating the CRS.
 With such a system, hotels can avoid overselling
rooms by too large a margin.
 The CRS database can also be used as a chain or
individual property marketing tool because guest
information can easily be stored.
 A CRS can also provide yield management
information for a hotel.
 A CRS can be used in several areas of a hotel.
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 GUEST RESERVATION SYSTEMS
 If a hotel has a reservations department, the
terminals or personal computers in that
department can be connected to the CRS.

 Another form of technology is an application

service provider (ASP), delivering a booking
system tied to hotel inventory in real time via the
Internet.

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 BILLING GUESTS
 Billing guests has become much easier with the
aid of computers.
 Billing guests can be a long process if information
technologies are not used to complete
transactions.
 PMSs aid large hotels to make transactions
faster and provide a more efficient service to
their guests.
 These systems help the hospitality associates bill
their guests within seconds.
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 SECURITY
 Peace of mind that the hotel or restaurant is
secure is a key factor in increasing guest
satisfaction. Security is one of the highest
concerns of guests who visit hospitality
businesses.

 Hospitality information technology systems

include surveillance systems, electronic door
locking systems, and in-room safes some using
biometric technology.

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 GUEST COMFORT AND CONVENIENCE

 In order to provide a homey and convenient

experience for the guest, hotels provide such
services and amenities as dining, televisions,
telephones, Internet connections, minibars,
hygiene products, pools, meeting space, and
business and concierge service.

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 RESERVATIONS

 The reservations manager is the head of the

reservations department and reports directly to
the rooms division manager.
 The reservations department is responsible for
selling hotel rooms for the maximum dollar
amount while exceeding guest expectations.

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 RESERVATIONS
Reservations originate from a variety of sources:
 The Internet
 Corporate/1-800 numbers
 Travel agents
 Telephone to the same property
a. Fax
b. Letter
c. Cable
 Meeting planners
 Tour operators
 Referral from another company property
 Airport telephone
 Walk-in 36
 RESERVATIONS
 The corporate CRS interfaces with hotel inventory
and allows reservations by individual hotel
reservations personnel.
 Once a reservation has been made, the room is
immediately deducted from the inventory of rooms for
the duration of the guest’s stay.
 Important details are recorded when the reservation
is made, such as name, billing information, duration
of stay, special requests, etc. 37
 RESERVATIONS
 Confirmed reservations are reservations made
with sufficient time for a confirmation slip to be
returned to the client by mail or fax.

 Guaranteed reservations are given when the

person making the reservation wishes to ensure
that the reservation will be held. This is
arranged at the time the reservation is made and
generally applies in situations when the guest is
expected to arrive late.

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 THE SEQUENCE AND
RELATIONSHIPS OF A HOTEL GUEST
RESERVATION.

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 COMMUNICATIONS CBX OR PBX
 The CBX or PBX includes in-house
communications, guest communications, voice
mail, messages, and emergency centers.
 It is a profit center for the hotel because hotels
generally add a fee of 50% to all long distance
calls and may charge fees as high as $1.25 for
local calls.
 The Communications center is staffed 24 hours a
day. Staff should be well versed in guest service
techniques and emergency procedures.

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 GUEST SERVICE/UNIFORMED SERVICES

 First impressions are very important.

 The guest service staff has the unique
opportunity to make or break that first image of
the hotel and the experience the guest will have.
 The staff of this department consists of door
attendants, bell persons, and the concierge.
 Door attendants are the hotel’s unofficial
greeters.
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 GUEST SERVICE/UNIFORMED SERVICES

 Their job requires them to greet guests, assist

with the opening and closing of doors, handling
luggage, and providing information.
 The bell person is responsible for escorting the
guests and transporting luggage to their rooms.
 He/she must have knowledge about the area, as
well as the hotel and its services.

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43
 CONCIERGE
 The concierge is a uniformed employee of the
hotel who has a separate desk in the lobby or on
a separate concierge floor.

 Some of the ways the concierge may assist guests

are by arranging tickets to popular events/shows
in town, making reservations at restaurants,
providing advice on local activities, reserving
airline tickets and reconfirmation of flights, and
special requests such as shopping.

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 CONCIERGE

 It is important that the concierge has excellent

knowledge of the hotel, the city, and
international details. It is a definite strength if
the concierge is able to speak several foreign
languages.

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 The concierges’ organization is the UPPGH
(Union Professionelle des Portiers des Grands
Hotels).
 http://www.lesclefsdor.org/
 http://www.clefsdor-
france.org/asso5/index.php?option=com_content&view
=category&id=113&Itemid=62

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 HOUSEKEEPING

 The housekeeping department employs the

largest number of employees in the hotel.
 The executive housekeeper is the head of the
department.
 It is necessary for the executive housekeeper to
have exceptional leadership, organizational, and
motivational skills, as well as a high level of
commitment to maintaining high standards.
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 HOUSEKEEPING

 By far, the greatest challenge for the executive

housekeeper is the leadership of the department.
 Often the employees in this department are of
different nationalities.
 The executive housekeeper is responsible for a
substantial amount of record keeping.
 Most of the hotel’s maintenance work orders are
initiated by the housekeepers.
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 HOUSEKEEPING

 In addition to the scheduling and evaluation of

employees, an inventory of all guest rooms and
public area furnishings must be accurately
maintained with the record of refurbishment.
 Productivity in the housekeeping department is
measured by person hours per occupied room.
 The labor cost per person hour for a full-service
hotel ranges from $2.66 to $5.3 per occupied room.
 Labor cost is expected to be 5.1% of room sales. 49
 HOUSEKEEPING
 The rooms of the hotel are listed on the floor
master. If the room is vacant, nothing is written
next to the room number. If the guest is expected
to check out, then SC will be written next to the
room number. A stay over will have SS, on hold
is AH, out of order is OO, and VIPs are
highlighted in colors according to the amenities
required.

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 HOUSEKEEPING
 If 258 rooms are occupied and 10 of these are
suites (which count as two rooms), then the total
number of rooms to be allocated to room
attendants is 268 (minus any no-shows). The
remaining total is then divided by 17, which is
the number of rooms that each attendant is
expected to make up.

 Therefore, 16 attendants are required for that 51

day.
HOUSEKEEPING DEPARTMENT
ORGANIZATION CHART

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 SPA
 Soaking in hot water was popular as early as the
fifth century b.c. in Greece and on some Aegean
islands.
 Later the Romans spread the spa idea as they
expanded their empire. The hot mineral springs
in Bath, England were used by the Romans in
the first century a.d. About 2,000 years ago the
Roman emperor philosopher, Marcus Aurelius,
found the waters of what is now Baden-Baden
(translates to bath), Germany, remarkable for
moderating his arthritis.
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 SPA
The spa business has four mantras:
 decompression,

 revitalization,

 beauty,

 spiritual uplift

(not necessarily in that order).

 The objective is to achieve maximum relaxation,

renewal, and recreation for the client.

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 SPA

Many people, perhaps most, see the spa as a

time of renewal or decompression and for
pampering and mental adjustment, increase in
physical strength, and intellectual and spiritual
enrichment.

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 TYPES OF SPA’S
 day spas (resort spas),  destination spas,
 medical spas,  cruise ship spas,
 club spas,  mineral spas.

Spa treatments include:

•hydrotherapy, the use of water as in a sauna,

•mineral springs,
•whirlpools,
•tubs, and
•steam rooms.

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 Originated in Asia where Ayurveda, a holistic (whole body)
healing system developed in India thousands of years ago.
Ayurveda is based on the belief that health and wellness
depend on a delicate balance between the mind,body, and spirit.
The primary focus of Ayurvedic medicine is to promote good
health rather than fight disease.

 Other spa treatments are based on traditional Chinese

medicine (TCM) and the yin-yang and five elements theories.
Typical TCM therapies include acupuncture, herbal medicine,
and qigong exercises. These therapies are different in approach
yet they share the same underlying set of assumptions and
insights in the nature of the human body and its place in the
universe.
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 SPA CUISINE

 The term “spa cuisine” suggests beautiful food

and limited calories, served in beautiful
surroundings. Spa guests expect to leave slimmer
and trimmer.

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 LAUNDRY
 Nowadays, more hotels are operating their own
laundry services.
 Modern laundry operates computerized
washing/drying machines and presses.
 Some smaller hotels contract out their laundry
services.

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 GREEN HOTEL INITIATIVES
 This sub-department generally reports to the
executive housekeeper.
 Environmentally conscious companies are
helping to avoid environmental degradation and
are saving money, while being good corporate
citizens.
 Ecoefficiency, also generally termed “green,” is
based on the concept of creating more goods and
services while using fewer resources and creating
less waste and pollution.

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 GREEN HOTEL INITIATIVES
 Ecoefficiency helps hotels provide better
service with fewer resources; reducing the
materials and energy-intensity of goods and
services lowers the hotel’s ecological impact and
improves the bottom line.
 Guest Shuttle - Free shuttle service to area
attractions is provided; the vehicle is either a
hybrid car or a 15-passenger van for bigger
groups.
 Guest Bicycles - Bicycles are available for guest
use in warm weather. Excellent bicycle route
maps are provided for those who want to explore
the city on two wheels. 61
 A MODEL FOR THE
IMPLEMENTATION OF SUSTAINABLE
LODGING PRACTICES.

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 SECURITY/LOSS PREVENTION
 Hotels are responsible for the safety of their
guests.
 Protection of guests and their property is a key
element of hotel operations.
 Security/loss division is responsible for
maintaining security alarm systems and
implementing procedures aimed at protecting the
property of guests, employees, and the hotel
itself.

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 TRENDS IN HOTEL AND ROOMS DIVISION
OPERATIONS
 Diversity of work force.
 Increase in use of technology.
 Continued quest for increases in productivity.
 Increasing use of revenue management.
 Greening of hotels and guest rooms.
 Security.
 Diversity of the guest.
 Compliance with the ADA.
 Use of hotels’ Web sites.
 In-room technology upgrades.
 Television service upgrades. 64