HBM 131 1st Edition Lecture 2Outline of Last Lecture I. Goal and ObjectivesII. What is Hospitality?A. Definition of HospitalityIII. What businesses make up this industry?A. The Umbrella of Hospitality IV. Primary SectorsV. The Manager’s RoleVI. How to prepare for a Career in Business HospitalityVII. Why do Students study Hospitality Management?VIII. Employment OpportunitiesIX. Outlook for Hospitality Outline of Current Lecture:I. Outlook for Hospitality A. Accelerating CompetitionB. Service is the DifferenceC. Value ConsciousnessD. TechnologyE. EmpowermentF. DiversityG. Concern with SecurityH. SustainabilityI. Globalization Current LectureI. Outlook for Hospitality A. Accelerating Competition 1. Competition across segments has increased dramatically2. International competition has also increased3. Competition had led to more emphasis on creating specialized niches and better management practices4. Factors include: Cost of money and demand for specific servicesa. Culinary tourism: go somewhere for its food and drink 5. Medical Tourism- like in the UK: countries will pay patients to go to other countries like Turkey to get a surgery because it is cheaper6. Adventure Tourism and Green Tourism: outdoors adventures. Increasing amount of people making tourism decisions relating to tourism companies that are more “green”B. Service is the Difference*Service is key to making the business successful: customer service (ex: Nordstrom)-Concept of Competitive advantage: having the advantage of best customer service over competitors that is not easily duplicatedEx: Wal-Mart’s delivery process: always have a truck full and going even if it is full of another competitor’s inventory (making money off the delivery) Items are sold cheaper because they receive them cheaper 1. Service is more and more what brings customers back (or prevents them fromreturning)2. Companies that provide excellent service inevitably lead their segments3. Not limited to hospitality4. Difference between SERVICE and HOSPITALITY?C. Value Consciousness*Good value: expectations are exceeded: having a better experience than what you expected1.Customers are getting smarter and more selective2. Customers look for value in all hospitality experiences and purchases3. Value doesn’t mean the lowest price4. What is the value equation5. Customers also tend to balance time and money spentD. Technology 1. The hospitality industry has been slow in terms of adapting to new technologies but the industry has made some inroads2. Perhaps the segment that is the most advanced is the airline industry, both in terms of on-line interaction with customers as well as up-to-the-minute pricing3. New technologies are being introduced every year: Ipad ordering, online ordering, 5 guys, pizza4. Urbanspoon, Yelp, Four Square etcE. Empowerment1. Empowerment is the act of providing additional levels of responsibility to both employees and managers2. This has been the result of cost cutting efforts but also as a result of trying to improve customer satisfaction3. It has been able to happen because of the new “breed” of employees as well as improved technology and communication. You will be expected to do more than in the past!D. Diversity*Learn to communicate with other cultures to be more hospitable 1. Hospitality organizations are becoming more diverse in response to changes insociety as well as demographic shifts and becoming more aware of the importance of a diverse organization2. Many companies have established themselves as leaders in this area3. Workforce Diversity, Guest Diversity Examples?E. Concern with Security 1. Concern for personal security and safety has resulted in destinations, organizations and society in general attempting to provide a greater level of safety for travelers2. Examples include airline marshals, hotel security forces, cameras (my restaurant), and increased education (Serv Safe )F. Concern with Sanitation1. Increases in food-borne illness has resulted in a raised concern on the part of consumers2. Raised concerns in the US probably began with the Jack-in-the Box incident in the 1990s3. More recent incidents have also raised questions about the quality of the food supply and even the water supply (e.g., bottled water)G. Sustainability 1. Going “green” is not new, but it reflects industry-wide focus on corporate responsibility2. Most hotels encourage guests to reuse towels and many have embraced low-cost changes such as lighting3. Guests prefer to support businesses that are concerned about the industry. H. Globalization1.Globalization is perhaps one of the greatest factors affecting the industry as it impacts every facet of operations including:2. Competition3. Work force4. Travel patterns5. Company alliances,