The Biggest Problem in the Hospitality Industry Is the Customer

The hospitality industry depends upon customers’ loyalty and satisfaction. Thus, critics state that “the biggest problem in the hospitality industry is the customer – they want everything for nothing and they turn up only when they feel like it”. Hotel chains must now strategize with respect to both the physical product and the “virtual” product, such as information and services. Overlaps in physical and virtual environments occur in the hotel industry, particularly those where a tangible product and an intangible product, such as service provision or information support, coexist. The statement mentioned above is not true because many hotel chains and recreation facilities maintain poor services and provide poor support to customers investing nothing in improvements and changes.

In the hospitality sphere, strategy is the most detailed of the three levels. It entails allocation of services within hotel chains, services, or businesses, and includes policies toward particular strategic functions including customer service, marketing, development, and human resources. At the practical level, strategic planning in hotel chains might even take place. Cross-functionalism gets around bureaucratic, or structural, changes that may slow functional planning. Hotel chains prefer to invest nothing in improvements and changes establishing extremely high prices for their services and facilities. The investment programs should also support planning reflective of the hotel chain’s overall objectives. Note that, for new, smaller, or one- hotel chains, business, and strategic strategies may be similar, even identical. The long-term customer satisfaction strategy should be built on creating strong relationships with customers and anticipating their needs. A significant new challenge is emerging with regard to customer satisfaction and loyalty (Doyle and Stern 2006).

The main problem in the hospitality industry is communication and interaction between staff and customers. Ideally, in the hospitality industry, the staff is the identification, or categorization, of job “demographics” and qualifications. The hotel management team should include personnel titles, like sales representatives, operators, and professional accountants; and their level of training. Another way to look at hotel chain staff is strictly in terms of the job description. Service management is often a reflection of hiring practices, placement, cross-functional contact, team activity, mentoring, formal and internal training, and reward and gratitude. Almost as important as what hotel chains staff is, is what it isn’t. Hotel chains staff can be defined as the ability to contribute focused on function and training (What advantages will tour operators have 2005).

This new approach to service delivery in hotel chains has been called the “reciprocity model,” in which provision of satisfaction, and the means to create it, takes precedence over desired objectives (which, traditionally, has been the framework for customer loyalty). The service necessitates an alternative strategic management process, with sub-processes. In hotel chains, specifying a set of the main customer needs and wants for which the hotel chains take responsibility, defining a complementary set of services that satisfy those demands, and committing the organization to continue providing the best value in satisfying those needs (Paley 2006). Evaluating customer satisfaction and performance and initiating adjustments to defined responsibilities, capacity, and capability, in light of changes in environmental factors, competitive offerings, and new contribution alternatives.

Customer satisfaction strategies are often as much, or more, a matter of the support provided by customer-focused management (Hollensen, 2007). The main problem of the modern hotel and hospitality industry is poorly trained seasonal staff who pay no attention to effective communication or commitment. Ideally, a customized multi-layer brokerage firm’s services program would be far less effective without the training and support of service staff. In many situations, speed of service delivery is what drives services as varied as processing, car rental check-in, package and mail delivery, food delivery, and eyeglasses. In the hospitality industry, the choice of services represents tremendous strategic opportunity, but challenge, because, while hotel chains are offering value to their customers, so are competitors. Rather than one-up hotel competitors with several options (which travelers may not want), one approach some hotel chains have taken is “mass customization,” where they can deliver services precisely to customers’ conditions (Mayo 1998; “Somers on Travel: Bad Manners” 1997).

The other problem is that the hospitality industry does not have shared values goals as a set of overriding, guiding meanings, directions, and concepts–as understood by the hotel chains and customers–that the hotel chains consider significant and unique, even differentiating. In order to succeed in this industry, a hotel chain should also follow its mission or vision, that banner which all members of the hotel chain are expected to march behind and honor. Participatory customer service management, autonomous business units, and empowered employees are the style supported by company leaders (Fill, 1999). All staff should be carefully selected and trained to be original and innovative, and innovation should b reflected in a shared value within the hotel chain culture. Effective communication skills should be evident in hotel chains’ capacity to introduce and service a continuous flow of new products (Ingram, et al 2003; Ehrenreich 2002).

The current state of the hospitality industry shows that many customers are dissatisfied with services ptrovide4d by hotel chains and recreation facilities. Hotel chains should hold responsibility and authority to act, more so because management/approval layers have been minimized. Recognition of unique customers’ needs should be stressed, and staff should be encouraged to make suggestions. Teamwork and cross-cultural communication should exist throughout the hotel chain, with the objectives of improving work processes, preventing problems, and eliminating dissatisfaction and poor quality. Hotel chains, in particular, should train staff to understand customer needs. By creating a unique culture that supports employees’ skills-building and growth, customer communication systems, minimal structure, and leadership, Hotel chains should see a tremendous increase in the value offered to customers. This, in turn, has considerably improved sales and profitability (Kotabe, and Helsen 2003; Decent Hotel, service poor 2009).

In sum, many hotel chains try to save financial resources on additional training of employees and new technology establishing higher prices for their out-of-date facilities. Being ahead of the curve on customer choice issues also means in-depth and continuing responsiveness to customer needs, problems, expectations, and complaints. Hotel chains should become all-suites hotels based on a choice opportunity that has had rather limited success because comparatively few travelers needed the extra room and because facilities such as full restaurants or round-the-clock room service are not always available from cheap hotels. A value innovation that succeeded in many horal chains should involve such services as credit cards and money-market services. Anticipating a customer’s choice will lead to increased customer satisfaction and loyalty. Hotel chains should offer a choice that few other institutions could not replicate.


Decent Hotel, service poor. 2009. Online. Web.

Doyle, P., Stern, Ph. 2006, Marketing Management and Strategy. Financial Times/ Prentice Hall; 4 edition.

Ehrenreich, B. Who’s Utopian Now? 2002, Frances Fox Piven; The Nation, 274 (1), 1.

Fill, C. 1999. Marketing Communication: Contexts, Contents, and Strategies 2 edn. Upper Saddle River, NJ: Prentice Hall.

Hollensen, S. 2007, Global Marketing: A Decision-Oriented Approach. Financial Times/ Prentice Hall; 4 edition.

Ingram, et al. 2003. Marketing: Principles and Perspectives/ McGraw-Hill/Irwin; 4 edition.

Kotabe, M., Helsen, K. 2003, Marketing Management. Wiley.

Mayo A. 1998, Creating a Training and Development Strategy. London: Institute of Personnel and Development.

Paley, N. 2006, The Manager’s Guide to Competitive Marketing Strategies. Thorogood.

Somers on Travel: Bad Manners, Bad Business. 1997, The News Letter (Belfast, Northern Ireland), (1), A 1.

What advantages will tour operators have? 2005. Online. Web.

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