Factors That Has Helped Four Seasons Hotel Tourism Essay

Factors That Has Helped quaternary Seasons Hotel touristry EssayThe main reason behind the preparation of this assignment is to analyse the case study active the factors that has boostered 4 Seasons hotel to succeed signly and understanding and appreciating the unalike growth strategies that atomic number 18 choose and implemented by 4 Seasons in order to be one of the triumphful operating lodge in cordial reception industry. This assignment also discusses the various downturns that the hospitality industry has faced over the years and how quadruple Seasons dealt with the speckle in order to survive in the backing. Moreover, in the assignment, the unique handicraft model of intravenous feeding Seasons hotel is comp atomic number 18d and think to unalike theories such as value chain analysis which shows how quaternity Seasons hotel is able to manage their stakeholders expectations.In addition, I have apportionn some recommendations for Four Seasons hotel, to re ceive in the hotel pipeline.Company ProfileFour Seasons Hotels and Resorts, the worlds leading actor of luxuriousness hotels with a history spanning four decades and a portfolio that extended worldwide. It is one of the worlds biggest and finest bonds of highlife hotels which have essential from one motel started by Isadore sharp 1961 in downtown Toronto Canada, to 82 opulence hotel properties in 34 countries worldwide.Four Seasons owns its own hotels, princip e realy under the Four Seasons and Regent names, as intimately as some former(a)s, including the Ritz-Carlton in Chicago and the Pierre in New York. About half the companys bread grapple from watchfulness fees, and half of it from properties it owns directly.Their highly admired helper timbre helped them to become benchmark in luxuriousness hotel market.The basic operational policy of Four Seasons hotel is Treat early(a)s as you would like to be careed. mellowedest smell of assistance to the customers is acq uired by Four Seasons by maintaining and improving their service standards also with an mod approach and continual development and an eye for detail e real single time of service.The company shifted from hotel owner to hotel operator in 1990s the companys 95% of the shares are owned by Bill Gates the founder of Microsoft and Al-Waleed Bin Talal (Prince of Saudi-Arabian Arabia equ exclusivelyy). Rest of the shares are owned by Isadore sharp CEO and company founder.Establishment of Four SeasonsFour Seasons Hotel Chain was founded in 1961, by visionary Isadore sharp with the opening of 126 agencys Inn on the ballpark in downtown Canada. curt was a degree holder in architecture and not from a hotel management background thus Sharp was totally new to the Hotel Business. Sharp describes himself a make uper who linked his fathers line of credit after graduation.Joining a hotel industry business was not at all in his mind or his intention till he was working on a project to build a motel. He got an expo undisputable with the motel project and he realized about the upcoming market of luxury hotels. The need of personalised service round the clock with the booming economy do him take a decision to get into Hotel business.The hotel he opened is named as The Four Seasons motor hotel which he opened with the help from his brother in law. The hotel became famous amongst the business travellers and celebrities as it had a innovative design it was different from other hotels as he built all rooms facing inwards giving a trance of inner courtyard and swimming pool kind of of the outside neighbourhood.Growth and expansionWith the sign success of his basic hotel, the big break through which Isadore Sharp was waiting for came in 1970 by opening first Four Seasons Hotel in Hyde Park area of London. Comparatively the room rate were higher than the competitors in the 270 room hotel exactly then also Four Seasons enjoyed 95% occupancy through out the year. The succe ss came with an innovative idea of hotel equipped with modish amenities unlike old traditional hotels in London.In 1972, Sharp opened a massive 1600 room hotel convention centre in Toronto, Canada in partnership with Sheraton. It took a long time to complete the project, al just about 10 years.In 1980 the economy was booming and the demand for luxury hotels increased , and thus Sharp started building hotels across the North America, later in al near every major US city, also to take an reward of real estate deals.In three decades by 1990, Four Seasons already opened 23 hotels in three countries with net earnings of $15 million.Four Seasons became Global leader in 1992 with acquisition of Regent International hotels. further strong financial infantry to build and buy hotel properties worldwide came in 1994 when Saudi Prince Alwaleed Bin Talal bought 25% of companys shares. They also signed a contract with Carlson Hospitality to develop and expand regent label worldwide through es tablishing management contracts and franchising agreements. sign Success Factors of Four SeasonsTo com stack awaye best of small hotels with the best of large hotelsIsadore SharpHe came up with the idea of opening the medium sized hotels which was enough to give a touch of personalised service providing with a range of luxury amenities and services.Running business from lymph glands PerspectiveThe most(prenominal) effective initial schema for Sharp was to look at the business from customers point of view. He was a innovative nous to fulfil customers needs in terms of luxury. Example When Four Seasons came into existence the trend was to use slender towels in bathroom, he replaced that we 100% cotton towels which worked really considerably. With experience of opening the first hotel, Sharp realised customers are ready to spend for one thing thats service. And as Four seasons most guest were business travellers and with the experience he came to a conclusion that for them Servi ce means luxury.Luxury RedefinedMaintaining high quality service rout out also be a grease if delivered constantly according to Sharp. This idea caterd him with the initial success in medium sized luxury hotels which gives commitment of providing homelike comforts and personalised service. Thus luxury was redefined as Service and not as decor and architecture. Quality of service comes before the hotel decor and architecture for the customers. As most of the customers for Four Seasons were business travellers Sharp commentedThey are mostly executives, often under impel fighting jet lag, stress and the clock. We decided to redefine luxury as service.Thus the key towards Customer satisfaction was achieved by Sharp and he knew what the customers wanted unmatched service quality will give them agonistic edge. Although Four Seasons charge 20% extra room rate than the closest competitors but subdued they were successful of maintaining high occupancy rates. Further Sharp wanted the hi ghest personalised service quality for the guest which was possible alone if employees are motivated and happy they will deliver it. Thus employee motivation, mutual take to be and empowerment played a vital role in achieving customer satisfaction. And thus he introduced the rosy ruler.Golden ruleSharp refer to his first business rule as Golden rule treat your customers as you want to be treated. This became the operational policy for Four Seasons. Every employee is a atom of customer service and in charge of it.And he believed employees are the most important part of Four Seasons hotel because there is very limited time in which service encounter takes place unlike other industries. And the employee has to give his best to maintain proper service standards thus lot of screening and interviews are make to ensure the right candidate is selected for right job.InnovationInnovation contributed a lot in the initial success of Four Seasons. Most of the luxurious amenities and servic es like Shampoo in the shower, bathrobes, 24 hour room service, two- line phone in guest room, pressing iron, 24 hour secretarial service, big well lit desk were the First to be introduced by Sharp and Four Seasons. The Custom do mattresses is now became the standard of luxury hotels which was Sharps favourite.Vision of Isadore Sharp Provide each and every thing in the guest room that will make the customer happy.Growth Strategies adopted by four seasons sign success for Four Seasons did built a platform for them to grow world wide. It created a network of mid(prenominal) sized luxury hotel in almost all key financial cities all over the world.During this outgrowth Four Seasons adopted many different growth strategies as fol pocket-sizesBrand name is competitive advantageThe biggest asset for Four Seasons group was their brand name which was not responsible for their initial success but also a part of their global expansion strategy.The core business strategy for four seasons wast o end slightly improve their market position and profitability to ensure the competitive advantage while obtaining new management contracts worldwide.Strategic carnal knowledgeship with investorsWith the help of strategic relationships with many small private institutions earlier helped them to expand their opportunities worldwide. Prince Alwaleed bin Talal bought 25% of company shares and with his major coronations in Four Seasons which helped them to enter in new markets as well the ownership was not of Four seasons so it served their primary objective of being a management company.From Hotel owner to Hotel operatorsTheir unique business development model stated they wanted to be a hotel chain operator than hotel chain owner. It has ownership of only three hotels out of their sixty three hotels.Under this unique business model Four seasons hotel doesnt have a burden of ownership, the major capital is brought by the partners with whom Four Seasons developed strategic relationshi ps.There is wide range of management fees (base fee, incentive fee, sales and marketing charge and stockpile charge) for providing these services to the owner.How Four Seasons responded to stinting downturns?Four Seasons faced economic downturns in different years in four decades 1970, 1980, 1990, 2000 in the following years 74, 81, 91, 2001. And all of them made a substantial impact on Four seasons strategy.The hotel business during the time of recession were mainly stirred byIncreased interest rates andDecrease in market pricesWith the increased airfares and the increased occupancy rates the tourism was badly affected. Executives of the company were travelling less and the leisure facilities were decreased for the executives which affected the hotel and tourism market.Furthermore increased terrorism affected hotel and tourism market.There were drastic steps taken by different hotel operators by edged tire out cost, landing prices buy Four seasons believed that the industry is going to return to prescript soon and Isadore Sharp adopted exactly the other way. He took the challenge during the time of recession and saw the opportunity to develop the hotels. He told his executives about his thoughts that when our competitors are lowering standards we will pull ahead oursThe different actions taken by Four Seasons as an answer to economic downturns areFour Seasons followed their words to look after their employeesDuring the time of recession most of the hotel operators cut down their crusade cost but Four Seasons tackled the situation the other way, they responded by sideslip the overhead costs but not the labour costs. They aimed for maximizing labours value instead of lowering labour cost.Sharp explained this strategy to his executives,And we also know that what we must do to meet that goal, is to lower costs and raise service and product quality. But cutting costs and raise service and product quality. But cutting costs by cutting labour, if carried too far, lowers quality. The only way these seemingly conflicting aims can be reconciled is by responsible employees committed to working smarter. Instead of minimizing labours cost we should maximize labours value by convincing our employees that our purpose merits commitment.Four seasons offered Flexible Contracts to the employees rather than job cut, in which employees will be called on duty as per the demand of the business which replaced working four days a week instead of five days a week. It was in the agreement of the employees and all the employees were in favour of the decision furthermore the salaries and the bonuses of the managers was also affected. This all resulted in sharing a common policy in heading towards companys goals. improve the productsMost of the hotel operators paused the construction or running of a hotel for a temporary period but the billet business is really high during the time of recession because the properties are sold out on lower rates thus Four S easons tackled the situation by renovation and refurbishment to improve the products. Isadore Sharp believed that providing quality service to the guest are a necessity and not a service by itself. And if the hotel wants to sustain in the market the new trends in the hotel industries should be followed to keep up with the market. Thus to accommodate these changes and provide customers with quality service. During recession the room occupancy is the lowest thus the inconvenience caused to the guests are very less and thus the guests get a royal out of the world service. They followed this strategy during recession period which gave them a steady growth over the decade.Advertising costsMost of the competitors of Four Seasons hotel kept cutting their advertizing and marketing costs, but Four Seasons didnt cut their advertising and marketing budget to maintain the brand identification as they had a very good recognition in the Hospitality industry. It is easy to maintain the impulsion rather than restart it. This strategy helped them to gain a competitive edge over their competitors in maintaining their brand recognition.Property marketDuring recession the supply in the market for the land was than the demand on low prices. Four seasons took the advantage of low prices of the land and they picked the premium locations which would have been difficult to buy them in normal times. Thus this strategy paid off to Four Seasons during the time of recession and they came with the finest of the hotels in top locations after recession.How four seasons managed various stakeholder expectations?Stakeholder Person, group, or system that has direct or indirect stake in organization because it can affect or be affected by the organizations actions, objectives, and policies. (www. businessdictionary.com)There are three most important aspects of managing stakeholder expectationsKnow your stakeholdersKnow what exactly they except from youMake them accountable for realities of pro ject by qualification them aware of risks and consequences.(According to Dr. James Brown, president of the project management company Seba Solutions).Different stake holders of Four Seasons hotel areStakeholders play a vital role for a company to survive thus the company or organisation needs to implement a strategy for managing their stakeholder expectations.Thus Four seasons implemented following strategy for managing their stakeholder expectationsSTAKEHOLDER MANAGEMENTManaging the stakeholders expectation is a step by step processAfter identification of stakeholders, the jiffy step is to identify their needs.Needs and expectations of the stakeholders of Four seasons can be described as followsOwners Returns on investment by profit oversight Management fees on the basis of common revenue.Employees Empowerment, Career opportunities and job security.Customers High quality service and luxury.Society Corporate social responsibility.Their strategy to manage stakeholder expectations can be summarised with relation to value chain analysis as wellvalue_chain_analysisValue chain analysis is a belief to create competitive advantage and sustaining professional performance.Owner Expectation of the owners are really high on returns in terms of profit because they are the one who made the capital investment in the projects.The different aspects of value chain used by four season hotels are like Infrastructure of the hotel, the most innovative idea of the initial strategy was to come up with medium sized hotels, and it worked really well. It was made possible and successful by Isadore Sharp who was the degree holder in architecture and he knew the latest designs of buildings and hotels like building rooms facing inwards to avoid view of neighbourhood made significant contribution to it. These innovative designs really helped Four Seasons to come up with the highest occupancy among the travellers. Thus they were successful in managing owners expectations by giving retu rns on their investments in less time.Management To ensure a good gross revenue it is vital to get higher occupancy with good average room rate passim the year.Sales and Marketing and technology come into picture from Value chain analysis. The marketing strategy for Four season hotel is to target the luxury segment of the market. 69% of their business comes from business travellers and groups. So almost all of their advertising and marketing programmes were designed to enhance the sensation of luxury service provided by Four seasons hotel. technology played a vital part in achieving their goal by newly designed website and superior reservation system. They gained an advantage over other hotels by Global reservation system which gave an option to the guests to be comfortable with their own topical anesthetic language in North America, Asia and European Network.Example There are so many hotels in Hyde Park area but over 30 years Four Seasons has gained and enjoyed the highest occu pancy in the area with their strategy.Employees Employees expect Mutual respect and Empowerment from Four season hotel.Employees are the most important stakeholders of the organisation, if they are happy to work for the organisation the whole business cycle can run smoothly, If Employees are happy then the customers are happy with their service it leads to word of mouth advancement and the organisation gets a repeat business.Employees deserve a mutual respect from the management. Human Resource Management from value chain ensures that employees should get what they deserve and expect. And most importantly the Golden Rule of Four Seasons is treat others as you would like to be treated also they believe that if employees are happy then only they can make customers happy.Four Seasons has maintained empowering their employees, and the best outcome and results can be obtained from their employees by empowering them.Im sure weve all read reports on the productivity gains achieved by empo wering employees. And we all know the workplace has to change to come to this. And in a survey of 264 big company chairman, 62 percent agreed that one of the most important business issues facing them was building and keeping a qualified workforce.-Isadore Sharpd.) CustomersThe expectation of the customers is very high as Four Seasons targets luxury segment of market. Service factor from Value Chain is wisely utilized by Four Seasons to manage expectations of luxury for the customers.They redefined luxury as service. Four Seasons gained a competitive edge by provided high standard of service with personalised touch. Customers got what they expected from Four Seasons. And they are very successful in making customers happy.E.) SocietyAs Society expects some corporate social responsibility(CRS) from all the hotels and organisation, their expectation for four seasons towards society is really high as well. CSR includes encouraging activities for development of society and avoiding prac tices which causes disparage to the environment.Four Seasons explain how they help and take initiative towards community by various training and mentoring programmes for green people and helping whoever in need in their website www.fourseasons.com .Example They donate organic food to local farmers to feed their animals (Costa Rica) and also providing shelter camps to Urban Elephants(Golden Triangle, Thailand), Raising significant funds for cancer research and awareness programmes.RecommendationFour Seasons has a strong portfolio in the Hotel Industry but to sustain they should focus on few things which are as followsFour Seasons should concentrate on building more brands and focus on all the categories like upper-scale, middle and budget hotels. Unlike Accor group of hotel they have segmented their hotels and created a brand focusing the needs of its customers such as Etap, Ibis, Novotel, Sofitel etc.To compete with other leading brands Four Seasons should come up with more hotels all over the world for more brand recognition and for customers to have a taste of their service.Furthermore Four Seasons should continue the effective management of the hotel the way they are doing it to sustain in the market.CONCLUSIONWith the base of the case study and research on Four seasons hotel, Canadian based business has an excellent brand recognition all over the world. The company is moving ahead with excellence along with strong financial and operational management. Different innovative ideas of Four Seasons hotel helped them grow in this hospitality business over the years furthermore during the time of recession Four Seasons hotel did really well, thus it says Fours Seasons Hotel has turned economic down turn to a competitive advantage over their competitors by coming up with different properties with prime location after recession (they responded very well to economic downturn). They took the down turn as an opportunity to expand and thus they are achieving excellen ce in their business.