Question 2

From the above (i.e. question 1) propose a business policy for lean management that can help Gracias Hotel Group realize its potential including recommendations for the future operations of the Hotel Group. Critically evaluate your policy and assess its effectiveness (60 marks)

1. THE OBJECTIVE: Need to set objective of this report and should reflect in the concluding part.

The areas are suggestions and are not meant to be a total prescription to an answer.

2. FORMAT: The format should be formal with a clear title, summary page, contents page and a standard numbering system, 1.0, 2.0. etc. fond size 12(Arial); spacing 1.5

3. CONCLUSION: Conclusions should clearly illustrate the outcomes of the report and could be in a series of small paragraphs with headings (where possible) and relate back to the objectives and flow from the discussions.

4. RECOMMENDATIONS: These are a series of clearly set out actions, together with time scales and, if applicable, a bar chart for implementation

6. REFRENCING: It is essential that you show references that adhere to a Harvard Standard and should indicate books, journals and web sites.

7. INSTRUCTION: You are strongly advised to read carefully and analyze the information in the case study before attempting to answer questions 1 and 2

8. WORD COUNT: Your presentation should not be more than 3,000 words.

CASE STUDY OF GRACIAS HOTEL GROUP

Background:

Built on 2,600 acres of land is a magnificent hotel which often is used as the main landmark anytime the people of the Enugu Range refer when boasting. This hotel has all it takes to capture and consume the attention and funds of its visitors and clients. On the web-portal of the Enugu Range, it is comfortable written, When you think of a hotel what comes to mind? And the obvious answer is THE GRACIAS HOTEL (a home away from home). Quality food, neat rooms, technology etc as well as making the visitor relax and get the expected satisfaction from hotel management.

In the year 2010, the management of the hotel carried out a quality assurance and service delivery audit and the conclusions of the report was summed up in the statement our services were designed around us, not the customer/ clients said Mr. Emeka, Gracias Hotel Groups Chief Executive Officer. For example, room reservations and payment are made in advance via the internet, but the client on arrival have to wait for a minimum of thirty minutes to be shown your room he added in a presentation to the management team of the hotel in their end of year retreat.

They began looking for a better way to improve quality and customer satisfaction. After two years of searching, they discovered the Toyota Production System, also known as lean manufacturing. Developed in part by Japanese businessman Taiichi Ohno, the idea is to eliminate waste and defects in production; the end results being using few resources to maximize output. Gracias Hotel Group had wished it can tailor the Japanese model to fit hospitability delivery to its customer. The hotel at its last Board meeting agreed to engage a /6consultant to help them implement a similar programme to that of Toyota Production System to improve hotels delivery of services to customers.

As part of the initial preparation towards implementation of the programme, Mr. Emeka and other Gracias Hotel managers took their first trip to Japan in February 2013 where they visited manufacturing plants such as Toyota vehicle assembly plant, and Yamaha Automobile. Nearly 100 employees have toured plants in Japan since then and a tenth trip is planned for this November.

While Gracias Hotel Group couldnt say exactly how much they paid over the years to send the staff overseas, officials liken it to leadership training other companies pay for their employees. They say the benefits offset the costs.

People are not cars is very common for me to hear, Mr. Emeka said. We get so wrapped up in the seriousness and specialness of Hotel Group services, but we also have to open our eyes to other industries --- were way behind in information specialists and taking waste out of our process. Toyota is obsessed with the customer and customer satisfaction. All those things Toyota was about what we wanted.

So what does that mean?

Management had admitted that there were several wastes in the production system which has contributed to increase cost in operation. Many customers complain of waiting for a room or for room services. Records shows that there are excess inventory at the storehouse due to unplanned purchases and overprinting of marketing materials and consumables, leading to stockpiling brochures and pamphlets in storage closets.

The Hotel Group again has revised its strategic plan to introduce a Kanban system, which signals the need to restock in all of its hotels. Kanban, which means visual card in Japanese, uses exactly thatin other words a card put near the bottom of a pile of food orders or services, for example will ensure that when a room service matrons or chef sees the card, he or she knows its time to satisfy a request.

The Hotel group as a result of inconsistencies has been using different makes of cutlery and trays for services, which has cost the company several hundred dollars. Unused but opened materials must be thrown away. Currently the stock level of obsolete materials is unprecedented causing a lot of headache in inventory management. The consultant is tasked to consider these problems holistically.

It takes a series of simple steps to make improvements, said Mr. Eben Chucks, the operations manager who returned from a two-week trip to Japan last month. One example is the development of a flip chart showing the level of visiting customers. The chart shows the appropriate picture of what a visitor can do, and each chamber maids or matron who comes in the room doesnt have to waste time searching charts or asking questions.

Mr. Eben Chucks also wants to implement a production plan to hire more staff before a shortage exists based on turnover rates on any given hotel floor. The Hotel Group has the intention to develop and implement a customer safety alert system like Toyota model. Hotel Groups practice had been to identify and fix problems after the fact, perhaps leading to mistakes recurring many times before a solution was found.

Mr. Noel Luke, the hotel manager at Gracias Hotel Group, Kingston (branch), said most of the cost of hospitality delivery involves clogs in the flow of information in the form paper forms, order forms, phone messages, often leading to irritated customers. Working the backlog down cost more than if you never let things pile up in the first place, he said.

Hotel staff do wait until the end of the day before going through a stack of records to write comments and feedback after serving the customers and this is a concern to management. The Kingston hotel started implementing the Toyota model in 2012 and the indication was that theyve reduced bookings and telephone delays by having specialist hospitality assistants handle incoming calls, instead of untrained operators.

However, the initial problem encountered was that not everyone has agreed with the new system and a few staff have left Gracias Hotel Group because of it. To some it seems like obsessive compulsive disorder run amok, but it is part of a solution that eliminates mistakes, Mr. Noel Luke, said.

Note: The information in this case study is purely fictitious and has been prepared for assessment purpose only. Any resemblance to any organization or persons is purely coincidental.

Requirements:

Questions 1, 2, relate to the case study and should be answered in the context of the information provided.

Question 1

As a Management Consultant write a report to the Hotel Group Board to identify the seven types of waste as currently existed in the Hotel Group and explain how the elimination of these can contribute to cost reduction that can position the Hotel Group well ahead of its competitors in the hospitality industry. (40 marks)

Question 2

From the above (i.e. question 1) propose a business policy for lean management that can help Gracias Hotel Group realize its potential including recommendations for the future operations of the Hotel Group. Critically evaluate your policy and assess its effectiveness (60 marks)