STARWOOD PLANNING OPERATIONS

How would staffing for the opening of a brand-new hotel or resort differ from that of an existing property?

The focus of this case study (p. 405) is Starwood’s sales and operations planning from the perspective of both corporate planners and individual hotel property general managers. These two perspectives give you a unique view of what the aggregate planning process looks like, and how it gets translated into operational plans at the property level.

Discuss

1.At what points in the planning process would you expect accounting/finance, marketing, information systems, and operations to play a role? What inputs should these areas provide, and why?

2.Does Starwood employ a chase, mixed or a level strategy? Why is this approach the best choice for the company?

3.How would staffing for the opening of a brand-new hotel or resort differ from that of an existing property? What data might Starwood rely upon to make sure the new property is not over- or under-staffed in its first year of operation?

Solution

Discuss at what point in the planning process you would expect accounting/finance, marketing, information systems, and operations to play a role.

Since Starwood would need to know what is required of their expected sales, this needs to happen at the initial stages of the planning process. Since finance and accounting plays a very important role and has various inputs in the planning process. Starwood cannot operate without the inputs of the finance function. Inputting the finance function is essential to Starwood, and any other company.

So, if Starwood conducted this at the initial stages of the planning, they would be able to make allocations for the various activities that are involved in getting the products to the consumers. With the finance function, Starwood can plan for all the activities that require financial resources to operate, such as the employees getting paid, Starwood can make these allocations of funds in the planning stage through the finance function. So, to be clear, the finance function plays the role that is involved with the monetary requirements of the organization. Budgets as well as expected sales, revenues, profits and expenditure are all planned for by finance and accounting.

Explain if Starwood employs a chase, mixed, or level strategy. Discuss why this approach is the best choice for the company.

Starwood uses a mixed strategy to be able to handle the different requirements and needs that arise. Since there are different demand patterns during different periods of the year, with the mixed strategy, this employs Starwood with techniques that enable the company to handle the different patterns in the different regions. When the company is faced with seasons when there is low demand, the company must put in place measures that would attract their potential customers to their services and products. Starwood can do this by providing offers for their customers who use their services.

Offers than can include could be lower rates then they charged during the high season and therefore customers are able to enjoy the same services at a lower cost. Another offered can be weekend specials. If they provide such offers to their customers, Starwood can retain the customers it has as they are able to have high quality services accompanied with lower rates and costs. 

Starwood can also take measures that enable the company to handle the challenges that are associated with the high season. The owners of Starwood can cross train their employees to be in a position that they can handle different tasks. This therefore enables Starwood to deploy employees from regions that have moderate demand to the areas that need additional staff. This closes the staffing gaps that may exist in the regions that are experiencing high demand. Armstrong, J. (2012).

Reference:

Armstrong, J. (Oct 2012, version 165) ‘demand forecasting: evidence- based methods’. Strategic Marketing Management: A Business Process Approach, retrieved on 5 June 2017