Operations strategy and competitive advantage The WritePass Journal

Operations strategy and competitive advantage Abstract Operations strategy and competitive advantage , p. 11).   The most important criteria for winners in the hospitality industry centre on service, expertise, trust, knowledge, location, quality, price, reliability and speed.   Once each company enables a strategy that creates the means to meet these consumer expectations, the level of competitive advantage will have been raised in their favour (Hart 2012, p. 11).   The strategy of market penetration employs the relevant qualifiers and winners in order to establish a foothold in the market, making this evaluation critical. Market development uses the qualifiers to expand the reach of the parent company by addressing the emerging wants of the consumer base (Hart 2012, p. 11). The product expansion strategy utilizes the qualifiers and winners to build and expand on the foundation of the existing product line.   In each case the operational strategy is dependent on the consumer assessment.   The areas of cost, flexibility, service and delivery have a tremendous impact on eac h strategy (Rhee 2009, p. 30). The type of order qualifiers and winners are heavily influenced by the expectations of the consumer (Victorino and et al 2005, p. 555).   In the areas of luxury travel and hospitality the focus is on the innovative nature of the qualifiers such as inclusive child care.   Lower economic competitors are less susceptible to service qualifiers as the desire to save money and capitalize on available finance asserts itself (Victorino and et al 2005, p. 555).   With the lower level of spending the nature of the expectations turns to the facilities, including features such as kitchenettes and balconies, rather than the additional services. Associated industries such as the upscale and luxury wine industry base their qualifiers on variety (Verma and et al 2002, p. 11). This approach is not available to the lower end suppliers that must rely on other incentives to match the resources of the upper tier. In this case, winners in the economy sector of the hospitality industry will differ fr om the winners found in the luxury setting (Victorino and et al 2005, p. 555). Hassin (2009, p. 48) describes the area of human resources as a viable segment of order qualifiers and winners for the hospitality industry. Utilizing a series of multi skilled human resources adds a valuable layer of expertise and personal understanding to the operational strategy, ensuring a high level of service. This area of order qualifiers is supported by the Stanley and Wisner (2001, p. 287) study that confirms that the supply chain benefits through the implementation of internal qualifiers. By building on the foundation of good communication with the internal personnel, the perception of an inclusive and effective demeanour is transmitted to the consumer base, benefiting the entire strategy (Hassin 2009, p. 48). Further, the continuous training and development of these personnel will serve to cement their loyalty and skill set, thereby adding to the functional assets of the company. It is vital that the areas of human resources be included during the evaluation of any operati onal strategy (Hassin 2009, p. 48).   Lacking this key area of consideration will diminish the capacity to reach the expected goals. An evolving order qualifier is the application of mass customization based on the utilization of technology (Kumar 2007, p. 1). The ability to tailor a stay or service in the hospitality sector to an individual’s desires has the potential to become a order winner.   This form of qualifier has been made available through the inclusion of online technology that has come about due to the near universal reach of the Internet (Kumar 2007, p. 1).   Yet, while in the beginning this form of service would have been deemed an all-around winner, the sheer availability of   it has caused the consumer base to expect nothing less, making what was once considered a winner now a qualifier. The strategy of mass personalization has given many companies in the service industry a potent tool with which to attract the constantly shifting consumer base (Kumar 2007, p. 2).   With the primary factor of the hospitality service industry being personal service, the only sure way to create order winners is to possess a product or service that the consumer absolutely must have above all others. Verma and et al (2002, p. 470) assert that the area of customer choice provides a wealth of order qualifiers in the hospitality industry. The sophistication of technique and opportunity serves to draw in a substantial consumer base.   Utilizing a consumer choice modelling method enables a tailored approach to each market, providing more relevant qualifiers to the operational strategy (Verma and et al 2002, p. 470). Ritz Carlton Order Winners â€Å"the most important element of their [Ritz Carlton] hotel stay is being pampered† (Wyle 2009, p. 8). This Ritz Carlton experience is designed to enliven the senses, instil wellbeing and fulfil expectations. The hotels approach to the hospitality industry rests in the upscale, luxury avenue (Wyle 2009, p. 6). With a world renowned reputation to maintain, the leadership utilizes the expectation factor to manufacture order winners. The effort to maintain a superior level of customer satisfaction through the anticipation and provision for each need is a long time avenue to meet this goal (Wyle 2009, p. 3). However, this very element can also serve to create obstacles that can serve to slow down consumer acceptance. Alongside the effort to establish a very high threshold of service, the Ritz Carlton is open to the magnified perception of failure when their service fails to meet the consumer perceptions (Drejer 2002, p. 65). With a very real appreciation of the factors that com bine to create order winners, such features as the doorman meeting each and every customer with an open door only serves to frame the offered package. For the Ritz Carlton Company, order winners are centred on the consumer’s perception of efficient and all inclusive service (Wyle 2009, p. 9).   Utilizing a process centred approach featuring the Gold Standard, management takes extra care to create and preserve the feeling of being completely taken care of. Consumer appreciation to this offering can be found in the very high return rate of satisfied customers. Another example of their willingness to meet the needs of the consumer through service was found in the staff ordering specific glass ware for a specific client (Wyle 2009, p. 4).   This attention to detail adds value to the consumer which creates a clear order winner for the Ritz Carlton. With this approach it is the area of quality control, human resources and consumer satisfaction combining to create a process that provides a method for qualifiers to become winners. In order capitalize on the potential to identify internal winners; the Ritz Carlton institutes a Total Quality Management process, with the goal of strengthening the employees (Wyle 2009, p. 4). This approach to order qualifiers provides a well-educated staff to the consumer base, which responds by recognizing the capacity of the talent and purchases the service.   This human resource approach to order winners lays out a specific process for each consumer interaction which establishes a baseline for operations (Wyle 2009, p. 7). With additional features including a personal walk to the room as opposed to pointing, or a smile from each employee, the recognition of the value of the personnel to win continued patronage is apparent. In the case of the Ritz Carlton, which holds the international reputation as the ‘Hotelier to the Kings’, it is necessary to maintain the very highest standard of personnel (Wyle 2009, p. 8).   Coupled with this approach to a human resource centred order winners, is the annual recognition of the best performing employee, which in turns adds gravitas and confidence in the staff and underlying management (Wyle 2009, p. 8). Each of these areas create avenues to order winners for the Ritz Carlton management and is achieved through the recognition of process design, quality, innovation and human resources. The Ritz Carlton recognizes the area of quality as high on their list of competitive priorities (Russel and Taylor 2006, p. 2). In order to capitalize on the full range of opportunities, the leadership has developed a much targeted set of standards (Russel and Taylor 2006, p. 2): Each and every employee is trained and enabled to satisfy any guest’s wish. There is a process in place that creates teams at every level that creates objectives and devises the quality action plans. Each and every hotel has a quality leader. The creation of quality report tracks: Track guest room maintenance Percentage of consumers that do not have to wait. The time spent to achieve the industry best clean room appearance. A guest preference report which is then put into a working database. Utilizing this approach to quality management coupled with comprehensive training serves to create a steady stream of order winners for the Ritz Carlton Company.   This process of customization to meet consumer need is achieved by changing the service or the product designs (Krajewski and Malhota 2010, p. 14).   The Ritz Carlton considers a range of factors in order to create the best possible strategy: Low volume Close customer contact Easily reconfigured processes. The very high standards that are illustrated by the Ritz Carlton are the result of a very well developed, long term strategy (Drejer 2002, p. 61). This strategy has solid basis in theory as the concept of the hybrid model of combining approaches to find order winners is found viable in the research of Hallgren (2011, p. 511).   There is a need to balance between the factors of cost efficiency and overall flexibility. This can be achieved through the utilization of delivery and quality process performance (Hallgren 2011, p. 511). Conclusion This study has assessed the area of order qualifiers and order winners to determine their characteristics in the hospitality industry. The strategies that the Ritz Carlton employs to first identify order qualifiers and their subsequent ability to choose order winners is a demonstration of effective long term strategy coupled with a diverse support infrastructure. This area of study has a direct impact on the entire service industry by demonstrating the very real potential to be found in recognizing the value of identifying qualifiers and winners. Order qualifiers are the criterion that provides the consumers the incentive to buy the offered service or product, with the winners being the methods that have deemed successful.   There is the recognition that there is a limited life span of the winners in the hospitality industry, and the rapid evolution of technology and innovation will continue to provide means for competitors to find a way to appeal to consumers. The Ritz Carlton utilizes the quality and human resources approach to provide their consumer base with a comprehensive, in depth experience that is credited with the creation of a steady stream of order winners.   With specialized training that excels at providing the staff with both the authority and the education to complete the entire range of necessary services, the Ritz Carlton has recognized that to survive and excel in the luxury service industry requires a very high standard of operation. As the evidence in this study revealed, the expectations for the Ritz Carlton are going to be much higher than for more economical competitors, making the segment of training and customer service absolutely essential to progressive operation. Through the advent of positive branding and long term success, the Ritz Carlton has established a high threshold of expectation that requires a strong effort to maintain.   Yet, this achievement has been credited with maintaining the profile of the company. In each segment of the hospitality industry, the opportunity to generate order winners is found most often in the positive interaction with the clientele.   In the end, it will be a combination of practice, policy, experience and resources that will determine the effectiveness of any operational strategy. References Azorin, J., Pereira-Moliner, J. and Claver-Cort\Es, E. 2010. The importance of the firm and destination effects to explain firm performance.  Tourism Management, 31 (1), pp. 2228. Blanco, E., Rey-Maquieira, J. and Lozano, J. 2009. Economic incentives for tourism firms to undertake voluntary environmental management.  Tourism Management, 30 (1), pp. 112122. 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