Creating a Small Hotel Operating Plan that Fits Your Objectives and Budget

By Jed Heller President, The Providence Group | October 28, 2008

Strong communications between an owner and general manager are vital to the success of any property. The general manager needs to share the owner's vision while clearly understanding business strategy, objectives, accountability and metrics for success. In many cases, the owner and general manager will have already developed a broad based business plan that documents the goals and objectives of the property. Once these goals and guidelines have been established, it is incumbent upon the general manager to create a detailed operating plan to fulfill the vision.

The operating plan acts as a highly detailed roadmap that outlines very specifically the course of action that will be taken to achieve stated objectives over an agreed upon period of time. In general terms, an effective operating plan explains in detail what needs to be done, when, how, and by whom - essentially, it defines how the hotel will be managed on a day-to-day basis and sets a standard for hotel employees. The operating plan also serves as an outline of the capital and expense requirements for daily operations.

For small hotels, a sound operating plan will help managers address inefficiencies, operate more productively, and be better prepared for unforeseen market situations, all of which directly impact the bottom line.

Creating the Plan

In developing the plan, managers should include measurable details, but not to the level that it may restrict creativity. It should be written in a manner that enables measurement of progress toward specific operational goals and objectives, and should be consistent with the overall strategic goals of the hotel.

A well thought out operating plan is flexible and must be readily adaptable to new situations. The operating plan should also include contingencies for best case, expected case, and worst case scenarios. Potential risks should be identified and the plan should describe how those potential risks can be mitigated. For instance, how will the hotel maintain a high level of customer service if one of its key employees leaves? What external resources are readily available that can quickly address severe maintenance problems, like heating or plumbing, that will allow you keep your guests satisfied? A well-executed operating plan helps managers maximize profit in high and low seasons, anticipate swings in business and plan for staff and resources accordingly, so that the customer experience remains consistent.

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Coming up in January 2019...

Mobile Technology: The Future is Now

Mobile Technology continues to advance at a relentless pace and the hotel industry continues to adapt. Hotel guests have shown a strong preference for mobile self-service - from checking-in/out at a hotel kiosk, to ordering room service, making dinner reservations, booking spa treatments, and managing laundry/dry cleaning services. And they also enjoy the convenience of paying for these services with smart phone mobile payments. In addition, some hotels have adopted a “concierge in your pocket” concept. Through a proprietary hotel app, guests can access useful information such as local entertainment venues, tourist attractions, event calendars, and medical facilities and services. In-room entertainment continues to be a key factor, as guests insist on the capacity to plug in their own mobile devices to customize their entertainment choices. Mobile technology also allows for greater marketing opportunities. For example, many hotels have adopted the use of “push notifications” - sending promotions, discounts and special event messages to guests based on their property location, purchase history, profiles, etc. Near field communication (NFC) technology is also being utilized to support applications such as opening room doors, earning loyalty points, renting a bike, accessing a rental car, and more. Finally, some hotels have adopted more futuristic technology. Robots are in use that have the ability to move between floors to deliver room service requests for all kinds of items - food, beverages, towels, toothbrushes, chargers and snacks. And infrared scanners are being used by housekeeping staff that can detect body heat within a room, alerting staff that the room is occupied and they should come back at a later time. The January Hotel Business Review will report on what some hotels are doing to maximize their opportunities in this exciting mobile technology space.