mba intro to hospitality

8/3/2019 MBA Intro to Hospitality

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MBA in International hospitality Management

INTRODUCTION TO HOSPITALITY

Course Objectives:

Hospitality is fundamentally a service industry. This curriculum will help students from all stream joiningHospitality programme more aware about the industry they are joining. The students will be better

equipped to understand the Hospitality Industry.

UNIT 1- The Hospitality Industry

The hospitality industry consists of broad category of fields within the service industry that includeslodging , restaurants , event planning , theme parks , transportation , cruise line , and additional fieldswithin the tourism industry .

The hospitality industry is a several billion dollar industry that mostly depends on the availability of

leisure time and disposable income. A hospitality unit such as a restaurant, hotel, or even anamusement park consists of multiple groups such as facility maintenance, direct operations (servers,housekeepers , porters, kitchen workers, bartenders , etc.), management, marketing, and human

resources.

The hospitality industry covers a wide range of organizations offering food service and accommodation.The industry is divided into sectors according to the skill-sets required for the work involved. Sectorsinclude accommodation, food and beverage, meeting and events, gaming, entertainment and

recreation, tourism services, and visitor information.

CLASSIFICATION OF HOTELS:

Hotels can be classified in the following ways by:

y Star systemy Locationy Ownershipy Size and numbers

By star system

One Star Hotels

Hotels in this classification are likely to be small and independently owned, with a familyatmosphere. Services may be provided by the owner and family on an informal basis. There may

be a limited range of facilities and meals may be fairly simple. Lunch, for example, may not beserved. Some bedrooms may not have en suite bath/shower rooms. Maintenance, cleanliness andcomfort should, however, always be of an acceptable standard.



Tw o Star Hotels

In this classification hotels will typically be small to medium sized and offer more extensivefacilities than at the one star level. Some business hotels come into the two star classification andguests can expect comfortable, well equipped, overnight accommodation, usually with an en-

suite bath/shower room. Reception and other staff will aim for a more professional presentationthan at the one star level, and offer a wider range of straightforward services, including food anddrink.

Th ree Star Hotels

At this level, hotels are usually of a size to support higher staffing levels, and a significantlygreater quality and range of facilities than at the lower star classifications. Reception and theother public rooms will be more spacious and the restaurant will normally also cater for non-residents. All bedrooms will have fully en suite bath and shower rooms and offer a good standardof comfort and equipment, such as a hair dryer, direct dial telephone, toiletries in the bathroom.

Some room service can be expected, and some provision for business travelers.

Four Star Hotels

Expectations at this level include a degree of luxury as well as quality in the furnishings, decor and equipment, in every area of the hotel. Bedrooms will also usually offer more space than atthe lower star levels, and well designed, coordinated furnishings and decor. The en-suite

bathrooms will have both bath and fixed shower. There will be a high enough ratio of staff toguests to provide services like porterage, 24-hour room service, laundry and dry-cleaning. Therestaurant will demonstrate a serious approach to its cuisine.

Five Star Hotels

Here you should find spacious and luxurious accommodation throughout the hotel, matching the best international standards. Interior design should impress with its quality and attention todetail, comfort and elegance. Furnishings should be immaculate. Services should be formal, wellsupervised and flawless in attention to guests' needs, without being intrusive. The restaurant willdemonstrate a high level of technical skill, producing dishes to the highest internationalstandards. Staff will be knowledgeable, helpful, well versed in all aspects of customer care,combining efficiency with courtesy.

By location:

CITY/DOWNTOWN/COMMERCIAL HOTEL: These hotels are located in the heart of thecity. These hotels are more expensive than the suburban hotels. These hotels are patronized by

business men and high income tourists. These hotels are centrally located and at a convenientdistance from markets, railway station, airport, etc.

SUBURBAN HOTELS: These hotels are located in the suburb of cities, moderately priced andare of mostly medium, large or small size. Normally these hotels are patronized by low budget



tourists. The tourists, who do not want to stay in the heart of city as they want to be away fromhustle and bustle of city, prefer these hotels. Usually writers, poets, low budget tourists etc prefer to stay at suburban hotels.

AIRPORT HOTELS: These are Hotels located near the Airports, especially international

airports. Airport Hotels are popular because of their proximity to major travel centers. AirportHotels vary widely in size and level of services. Typical target market includes businessclientele, airline passengers with overnight travel layovers or canceled flights and airline

personnel. Hotel owned courtesy vans often transport guests between the hotel and the airport

MOTELS: Motels are also called Motor Hotels or transit hotel and are located alongside thehighways. Motels are normally economical and they provide comfortable bedrooms thatmotorists prefer to stay on their way for a night rest. Motels have facilities of proper motor garage to service a car and a filling station to refill vehicles, parking area for motor vehicles etc.They also have road maps, dormitory for drivers. These days Motels also provide various indoor and outdoor facilities like Video parlor, Billiards, Table tennis, Cyber café, Library etc.

RESORT HOTELS: A resort located in the tourist interest places like hills, forests, beaches, onan island, or in some other exotic location away from crowded residential areas. The recreationalfacilities and breathtaking scenery typical of most resorts. Most resort hotels provide extensivefood and beverage, valet and room services, sight-seeing to vacationers. Many resorts also

provide special activities, indoor and outdoor games for guests such as dancing, golf, tennis,horse riding, nature hikes, skiing and swimming, health club, steam sauna bath, spas etc. A moreleisurely, relaxed atmosphere distinguishes most resort hotels from other types of hotels.

ROTELS: The hotels which rotate on wheels are called rotels. It is also called motel on wheels.Best example of rotel in India is Palace on wheels. It is a luxurious train, fully air-conditioned,

well-furnished with attached restaurant and bar. The fare is inclusive of train ticket, food,alcoholic beverages and sight seeing. The train starts from Delhi and covers the tourist interest places of Rajasthan and Uttar Pradesh including TajMahal, Agra, Mathura.In Japan Rotels are parked in the parking slot in the late evening and during day the rotel is towed away.

FLOATELS: The hotels which floats on water are called floatels. The best examples of floatelsin India are House boats in Kashmir Dal Lake. These are luxurious suites consisting of drawingroom, dining room, bed room, sitting room, balcony, kitchen, bathroom etc. These days luxuryships are becoming popular for travelling. The guests are offered cabins to stay. These float onsea water and these have all facilities of five star hotels.

BOATELS: These are luxury boats/yachts which can ferry people from one place to another.The best example of yachts are in Mediterranean or Caribbean, they can ferry guest throughcanal-based narrow boat or Broad-based cabin cruiser. In Sir hand, Punjab there is restaurant on

boat.

TIME SHARE: This is a new concept in India but is picking up very fast. This is also known asµVacation Ownership¶ or µHoliday Ownership¶ concept. These properties are in resort areas likehills, beaches, forests etc. Time share involves individuals who purchase the ownership of



accommodation for a specific week or weeks. The price of the property will depend on the week,one tends to buy. The guest can choose a peak season, semi peak season or a lean season.

The owner pays a fixed price for certain number of years say 20 to 30 years and has a right tostay at the hotel during rented week. The guest also required to pay an annual contribution

towards the maintenance of apartment and public areas, electricity, gas, water, safety, insuranceetc. The owner can also rent out the unit through management. The owner can also exchangetheir resort with any other resort either directly owned by the company or through contractsigned with any other company/management by paying a nominal fee. Best example of Timeshare in India are Mahindra Holidays,Sterling Holiday Resorts, Avelon Resort, NandaTourist Corporation etc.

CONDOMINIUM HOTELS: These are quite similar to Time share. These units are developedon joint ownership basis. Each owner purchases and has full right of an unit he has purchasedand shares the cost common to the complex, such as taxes, insurance, maintenance and upkeep of

public areas including swimming pool, health club, parking, security, air conditioning, heating,

cable, broad band etc. Each owner can occupy or sell his unit independently but is required tofollow the rules and regulations laid by the management.

In some cases the management can help the owner in renting out the property. They take the fullresponsibility of the owner¶s unit¶s safety and also pay to the owner a major portion of the rentearned from renting out. The management earns a major portion by renting out conference halland from catering. Usually the management requests the owner to rent out in case of major conferences.

CHAIN HOTELS: A chain is usually classified as operating under a management contract or asa franchise or referral group. Chains usually make certain rules regarding standards, rules,

policies, procedures of affiliation etc. In general, the more centralized the organization thestronger the controls over the individual property. Some chains own affiliated properties, butmany do not. Some chains have strong control over the architecture, management and standardsof affiliated properties. Other chains only concentrate on advertising, marketing, purchasing.

INDEPENDENT HOTELS: Independent hotels do not have ownership or managementaffiliation with other properties. They have no relationship to other hotels regarding policies,

procedures, financial obligations, management; accounting etc. These may be registered as sole proprietor-ship or a private limited company. The owner may decide the standard, type of clientele, the tariff etc. He may tie up with travel agencies to sell his property againstcommission.

By ownership:

MANAGEMENT CONTRACT: Management companies are organizations that operate properties owned by others. Those other hotels may be owned by individual persons, partnerships or private limited companies. The individual hotel, under construction, may contractwith a professional hotel management company to operate the proposed property. Thesecontracts are normally on a long-term basis. Some management companies, when feel that they



must have a hotel in a particular location then they approach prospective individuals to build ahotel and operate under their managements contract.

The management contract can even be signed before the construction starts. After paying themanagement fees, operating expenses, the owners keep the balance cash for paying their debts,

taxes etc. and the balance is their net profit. The Management companies only take over themanagement of the company, whereas the franchising companies provide the financialassistance, advertising, central reservation facilities, marketing etc.

. FRANCHISE: Franchise is a system in which the franchise owner grants another the right or privilege to merchandise a product or service for a specified return. Franchise Agreement is anagreement under which the owner operates as a member of the chain, utilizing the brand image,name, goodwill and obtaining for a certain fee some services of marketing and operating naturesupport from resources of a large organization, advertising, sales promotion, technical andfinancial help etc. The best known franchising companies are Holiday Inn, Choice International,Quality Hotels & Inns etc.

REFERAL GROUP: referral Groups consists of independent hotels which have groupedtogether for some common purpose. Though the properties in the referral group may be differentfrom each other but there is sufficient consistency in the quality of service to satisfy guestexpectations. The member hotels recommend guests to other member hotels. Best WesternInternational, one of the largest hotel chains is the best example of referral groups. The referralgroups also extend benefit of more extensive reservation and expanded advertising through

pooled resources.

By the length of stay:

TRANSIT HOTELS: Motels and airport hotels are the best example of these hotels. These hotelsare patronized by those guests who are in transit and will be travelling further to their destinations. Sometimes these hotels also charge room rent for half a day as guests would like tostay just for a few hours. At times these hotels have much more than 100% occupancy. In Indiathe motels have not become very popular as people do not travel very long distances by their own vehicles.

TRANSIENT HOTELS: Rest houses, Government guest houses etc are the best examples of transient hotels. In these hotels one is not allowed to stay for a very long time as these hotels arevery economical and are patronized by the employees either on transfer or on tour or onvacations.

RESIDENTIAL HOTELS: These hotels offer rooms/apartments on monthly basis and even if aguest stays for a part of the month, is normally charged for the full month. The best examples for these hotels are hostels, paying guest houses for students, trainees, working people etc. Some bigcompanies also hire them for months/years for their company executives for pleasure, business,training etc. These can be located in any part of the country, it may be a hill station, beach etc.for pleasure or a big city or an industrial town for business.



SEMI RESIDENTIAL HOTELS: Most of the hotels in present days are semi residential hotelsand are located throughout the country. The guests, staying in these hotels, are required to payroom rent on daily basis. Guest may hire the accommodation for months or years together but therent charged will be on daily basis .The hotel may offer a special allowance on room rent to theseguests.

By clientele:

HOSTELS: The student¶s hostels are very common both in schools and colleges. These can only be patronized by the students of a particular school or college. The hostels can also be attached tooffices, banks etc. These are also called residential hotels as they charge on monthly, half yearlyor yearly basis. These hostels provide nutritive food, keeping in view the needs of the residents.

Heritage Hotels: The Government of India to boost up tourism and to preserve the India heritagehas started a scheme, where old heritage buildings, palaces constructed before 1935 wereconverted into hotels. Heritage Grand Hotels are those which are more than 100 years old.

BOUTIQUE HOTELS: These are very small and very expensive hotels and mainly cater for elite class. Though the hotel is small but still it has more number of restaurants. Each one isdecorated keeping in view a theme and the food service.

ROLE OF A MANAGER IN HOSPITALITY INDUSTRY:

A hotel manager is responsible for the day-to-day management of a hotel and its staff. They havecommercial accountability for budgeting and financial management, planning, organizing anddirecting all hotel services, including front-of-house (reception, concierge, reservations), foodand beverage operations and housekeeping. In larger hotels, managers often have a specific remit

(guest services, accounting, and marketing) and make up a general management team. Whiletaking a strategic overview and planning ahead to maximize profits, the manager must also payattention to the details, setting the example for staff to deliver a standard of service and

presentation that meets guests' needs and expectations. Business and people management areequally important elements.

Typical work activities vary depending on the size and type of hotel, but may include:

y planning and organizing accommodation, catering and other hotel services; promotingand marketing the business;

y managing budgets and financial plans as well as controlling expenditure;y maintaining statistical and financial records;y setting and achieving sales and profit targets;y analyzing sales figures and devising marketing and revenue management strategies;y recruiting, training and monitoring staff;y planning work schedules for individuals and teams;y meeting and greeting customers;y dealing with customer complaints and comments;y addressing problems and troubleshooting;



y ensuring events and conferences run smoothly;y supervising maintenance, supplies, renovations and furnishings;y dealing with contractors and suppliers;y ensuring security is effective;y carrying out inspections of property and services;

The manager of a large hotel may have less contact with guests but will have regular meetingswith heads of department to coordinate and monitor the progress of business strategies. In asmaller establishment, the manager is much more involved in the hands-on day-to-day running of the hotel, which may include carrying out reception duties or serving meals if the need arises.

TOURISM PRODUCTS AND SERVICE

Product development improves the profitability of tourism businesses by increasing or enhancing products and services available for tourists. The Department of Industry, Tourism & Investmentworks with the tourism industry to facilitate product development.

The goals of product development are:

- To enable tourism businesses to overcome obstacles in order to enhance or develop new product and services

- To increase the number of products and services available for tourists, and increase the number of visits, the length of stay and the amount that visitors spend in the NWT

- To improve the profitability of local businesses,

CLASSIFICATION OF OTHER ALLIED SERVICES:

Aviation is the design, development, production, operation, and use of aircraft , especially heavier-than-air aircraft. Aviation is derived from avis , the Latin word for bird .

Civil aviation includes all non-military flying, both general aviation and scheduled air transport .

There are five major manufacturers of civil transport aircraft (in alphabetical order):

y Airbus , based in Europe y Boeing , based in the United States

y Bombardier , based in Canada y Embraer , based in Brazil y United Aircraft Corporation , based in Russia



Each country regulates aviation differently, but general aviation usually falls under differentregulations depending on whether it is private or commercial.

CRUISE LINES

The cruise industry h as grown and continues to grow enormously in scale . It is frequently regardedas a small but significant sector of the tourism industry

the cruise industry has a $ IS billion turno ver . It employs over 100,000shipboard officers and cre w as well as a ppro ximately IS ,OOO employees ashore. Indirectly , the indus -try provides employment for food suppliers , enginee r ing services , manufacturers , port agents andauthorities , transport companies, tourist companies , hotels , destin ation companies , and car-hire andemployment agencies.Ebersold (2004 ) draws attention to the g r owth of the industry in marketingterms , which ha s seen systemat ic and sustained ex pansion ov er 7 years , with appro ximately 64 mil-lion bed -days sold in 2002 compa r ed with 3S million bed -days sold in 1997. Construction of new ves -sels for the industry continues to be strong , and at th e beginning of 2004 there were some 19 newcrui se ships under construction, catering to a total of approximately 48 ,000 passengers (Bond , 2004) .

The Cruise Line s International A ssociation ( CLIA , 200Sb) , an organization that represents 19 of theworld' s ma jor cruise comp anies , announced that 10.S million passengers chose to cruise in 2004 . Thechanging demograph ic profile of cru ising , in terms of the market s egment, social status , and age, issignificant (Douglas and Douglas , 2004). One e xample of these changes is the estimate made byCarnival Cruises that they would carr y some SOO ,OOO children as passengers in 2004 : an increase of 400% over 10 ye ars (Carniv al, 200S).

In 200S , 11.1 million pass enger s are e x pected to t ake a cruise with one or mo r e of the CLIA 'smember companies (Anon , 200S a), a projected 4 .6% increase over 2004 figures . In 2004, 12 newships were .introduced , accounting for a 6.9% increase in capacity. The CLIA predicts that cruise fare swill increase , that the age of those cruising will continue to reflect a multigen erat ional m ix, and thatall segments of the crui se market will becom e even more focused on pro viding unique products andservices ( Anon, 200S a).

Air travel has been cited as a major influence onchan ging leisure a ctivitie s, y et even a novice can recognize the opportunities for sea and water basedvacations using ships as floating resorts.a cruise ship provideseasy access to s ome of the world's most popular destinations , and this simple statement holds the keyto th e current succe sses that the industry enjoys

For many tourists , the cruise experience embodies a series of powerful moti vator s: it is often per-ceiv ed to b e safe, social , customer friendly , and service oriented. The ship

provi des a mobil e, consistent, and easil y accessible location to act as a home away from home whilethe touris t samples the port of call . The tourist adapts to shipboard life and learns to relax into a vaca-tion routin e a routine that can be interspersed with a choreographed range of ship or land acti vities.

As tra vel expert Douglas Ward says , "Over 10 million people can't be wrong (that 's how many people took a cr uise last ye ar)! Cruising is popular today because it takes you away from the pressuresand strains of cont emporary life by offe r ing an escape from realit y. Cruise ships are really self-con-

tained resorts , without the crime, which can take you to several destinati ons in the space of just a fewdays" (Ward , 200 I).Howe ver , the notion of "cruising " also gen erate s negati ve perceptions (Table 1.2). Dickinson and

Vladimir (1997) c onducted interviews with people who either had not considered o r did not want togo on a cruise . They r evealed fi ve specific factors that demotivated the potential tourist: Ward (2001)counters this li st by highlighting emerging patterns. Cruising is presented as being both cost effectiveand high in value . The range of cruise types h as ex panded to include opportunities for all sorts of

people. In thi s way, cruising can be both socially in clusive and e xclusive : familie s can be catered toas a specialt y market , as can single tourists , conference delegates , older tra velers , a ctive tourists ,groups , etc. -the list is endless. Ward recognizes that this type of vacation i s appealing to older customers but also notes that the average age of first time cruisers is now well under 40 .



The in dustry is diverse, and it appears th at this is indica tive of the f uture direction fo r cruise devel-o pments. The fol lowing ca se studies present four con trast ing cr uise e x per iences. T he cases a re p r e-ceded by Ta ble 1.4 that provi des an easy comparison between basic feat ur es. The flag of reg istrationis important because it refers to the legal stat us of the ship.

Unit 2- PRINCIPLES OF HOSPITALITY MANAGEMENT

The term "hospitality management" refers to a range of occupations and professional practicesassociated with the administration of hotels, resorts and other lodging.

PLANNING IN ORGANIZATION:

Planning is an intellectual process which requires a manager to think before acting. It is thinkingadvance. It is by planning that managers of organization decide what is to be done, when it is to

be done, how it is to done, and who is to do it.

STEPS IN PLANNING:

1. Establishing verifiable goals or set goals to be achieved- first step in planning is todetermine the enterprise objectives. These are the most often set by upper level or topmanagers, usually after a number of possible objectives have been carefully considered.

2. Establishing planning premises- second steps in planning. i.e., certain assumptions aboutthe future on the basis of which the plan will be ultimately formulated. Planning premisesare vital to the success of planning as they supply pertinent facts and information relatingfor the future such as population trends, the general economic conditions, productioncost, and prices, probable behavior, capital and material availability, and governmentcontrol.

3. Deciding the planning period- once upper level managers have selected the basic longterm goal and the planning premises the next task is to decide the planning period.

MAKING PLANNING EFFECTIVE:

1. Coordination2. Communication3. Participation4. Proper climate

Planning skills:y Ability to think aheady Ability to define company objectivey Ability to forecast future environment trendsy Ability to frame correct strategiesy Ability to monitor the implementation of strategies.

DEPARTMENTALIZATION



-is one of the important steps of building an organization. The aim is to take advantage of thedivision of labour and specialization up to a certain limit.

C HARA C TE RIS T I C S OF E FF E C T IV E C ON T ROLSYS TEM S

Effective control systems have certain characteristics. For a control system to be effective, itmust be:

1. Accurate . Information on performance must be accurate. Evaluating the accuracy of theinformation they receive is one of the most important control tasks that managers face.

2. T imely . Information must be collected, routed, and evaluated quickly if action is to betaken in time to produce improvements.

3. Objective and C ompre h ensible . The information in a control system should be

understandable and be seen as objective by the individuals who use it. A difficult-tounderstand control system will cause unnecessary mistakes and confusion or frustrationamong employees.

4. Focused on Strategic C ontrol Points . The control system should be focused on thoseareas where deviations from the standards are most likely to take place or wheredeviations would lead to the greatest harm.

5. E conomically Realistic . The cost of implementing a control system should be less than,or at most equal to, the benefits derived from the control system.

6. Organizational Realistic . The control system has to be compatible with organizationalrealities and all standards for performance must be realistic.

7. C oordinated w it h th e Organization's Work Flo w . Control information needs to be

coordinated with the flow of work through the organization for two reasons: (1) each stepin the work process may affect the success or failure of the entire operation, (2) thecontrol information must get to all the people who need to receive it.

8. Flexible . Controls must have flexibility built into them so that the organizations can reactquickly to overcome adverse changes or to take advantage of new opportunities.

9. Prescriptive and Operational . Control systems ought to indicate, upon the detection of the deviation from standards, what corrective action should be taken.

10. Accepted by Organization M embers . For a control system to be accepted byorganization members, the controls must be related to meaningful and accepted goals.

These characteristics can be applied to controls at all levels of the organization.

ELEMENTS OF LEADING AND DIRECTING

1. Leadership-true leadership is taking people to a place that they would not go to bythemselves.

2. Communication-superior to subordinate3. Delegation-to assign specific task to workers4. Decision making and problem solving-



a. Identify the problem b. Gather and analyze the datac. Generate alternatives and select the best oned. Implemente. evaluate

5. policies and procedures-Policy- guidelines, tools for orienting, used as reference, basis for developing procedures.Procedure- specific direction for implementing policies, used for standardization for teaching and evaluating for updating employees.

6. Supervision-overseeing the activities of others, it is inspecting, guiding, evaluating andimproving the work performance of employees.

7. Coordination-synchronization of the activities8. Motivation- to arouse, excite and to influence behavior 9. Staff development- through seminars, conferences, training, etc.10. Conflict management-differing ideas, competition.

THE ENVIRONMENT

Hospitality includes the provision of accommodation and food and beverage services within a widerange of establishments and occasions.Paul Morrison, editor of the Australian Journal of Hospitality Management, has noted that theseinclude hotels, motels, clubs, casinos, restaurants, fast food outlets, bars, special event catering, andother services, farm and bed and breakfast establishments, but also in-flight, shipping, rail, school,hospital, college and armed forces catering service s.

He also suggested that while some patrons are bona fide tourists, the majority are undertakingleisure or commercial activities. This definition of the coverage of the hospitality industry led him tostate that it is the hospitality industry not the tourism industry that provides most of the employmentand creates the associated wealth attributed to tourism.

The business environment for those firms, government departments, and associations engaged in thehospitality industry is, as might be expected, similar in its generic aspects to that faced by any otherindustry, while containing a few specific components relating to the nature of that industry . Thesegeneric aspects are the macroeconomic environment, market opportunities, the political environmentconcerning enterprise and competition, policies towards foreign investment, trade, and exchangecontrols, taxes, and financing, and the social environment including labor markets, physical and social

infrastructures, and national and regional cultures

The internal business environment for the larger contemporary hospitality organizations includesinter alia production, marketing, facility management, purchasing, finance, information technology,and human resource management divisions, while as with other industries smaller firms may not beas internally differentiated. For any hospitality business to perform effectively however,interdependent individuals and groups within them must establish working relationships across thoseboundaries that exist. Individuals and groups depend on one another for information and support



.fa cilities so that action can be coordinated and complementary The external business environmentof the firm is most often largely uncontrollable by management. Factors such as demography,economic conditions, level of competition, industry structure, social and cultural forces, political andlegal forces, and technological level impact on the ability of the firm to provide its services to itsintended clients and to sustain its internal business environment. Equally, externalmicroenvironmental factors of the market, suppliers, competitors and intermediaries all influence thebehavior of the firm in the business environment. External factors perceived as causing change in thebusiness environment are generally identified as pertaining to two main categories: regulatoryframeworks and local business culture and structures (Correia and Wilson, 1997).

Changes of a regulatory nature (i.e., in rules and procedures, tariff barriers) may be linked to thenation joining a trading bloc such as the European Community or NAFTA and to governmentintervention in the economy (foreign ownership rules, monetary policy), while changes of a businessnature may be linked to such trends as concentration in the industry and the economic health of clientindustries, as well as to culturally based ways of conducting business.

Assessment of these environmental influences in recent times has shown that the business

environment for the hospitality industry has become increasingly hostile and rather complex, eventhough turbulence has at times stayed relatively low (Ansoff, 1987). On the other hand, the advent of such environments as the European Union-type Single Market or the global hotel chain have beenrecognized as inevitable and their ramifications are now faced predominantly with a moderate degreeof optimism within such markets and by smaller players in the industry, as it is now widely believedthat keeping market shares or conquering a niche market or realizing a successful alliance are possiblein most business environments. Also, a firm may have some influence on the politico-legal forces in itsenvironment through direct representations and industry association lobbying.

Factors that affect the impact of internal or external environments are the size of the firm and thecomplexity of its organizational structure. Another factor that influences the attention given by

managers to internal or external environments is the predominance of certain types of businessculture within the firm, or the non-existence of a business culture. The functional role played by thefirm in the hospitality industry also influences the impact of internal or external environments.

Internal environments are viewed by some managers as filters and by others as contaminators of theinformation provided by external environments. Some managers stress the complementaritiesbetween impersonal and personal business environments, impersonal environments being looked atas conveyors of generic information, meaning information that is in the public domain, or aboutfactors which, in principle, evolve gradually, and also as means to feed an attitude of generalawareness. While personal environments would convey specific information, meaning more or lesssecret information that cannot be found on printed sources and is transmitted only by w ordof-mout h, or specific and detailed information t h at can h elp in clarifying ideas orimplementing specific business strategies.



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