For example Hotels can outsource their food and beverage, marketing process, HR process etc.
Outsourcing is subcontrating a service provided by a third-part company. The first company entrusts one or several companies to do a specific job in order to save time, money and resources. Sometimes, the hotel cannot assume the workload and they need to subcontract specialized companies that provide high-quality services.
Besides, a hotel has high fixed costs. Keeping a hotel running implies having to face expenses no matter whether there are guests staying at the hotel or not.
Staff must go to work every day and, consequently, paid a salary. In order to deal with these costs, hoteliers may decide to contract out some activities so that fixed costs turn into variable costs. And here comes the dilemma of what services to outsource.
On the one hand, the world of experiences introduced in the hospitality industry makes it possible to offer more varied and better services, which requires highly qualified professionals. On the other hand, technology has made it possible to get a high degree of process automation in the hospitality industry.
This is the main reason behind IT outsourcing. Advantages Reduction of fixed costs. This means that the hotel can hire the services of another company depending on their workload.
Professionals will provide the hotel with the best product or service possible. For example, when it comes to designing marketing or advertising campaigns of any kind.
Companies specialized in technology services for the hospitality industry provide hotels with specific software programs and apps to manage allotments, organize warehouses, or control other internal process.
Failing to outsource IT management can be really expensive, as the hotel would have to hire software developers and other professionals to work at the hotel. Obviously, costs would rise enormously if a hotel or chain developed their own solutions.
If we are talking about services, and not manufactured products, this feeling is even stronger. As we all know, the services guests enjoy at a hotel are characterized by simultaneity, that is, they are produced as they are being consumed, as we explained here.
This makes it difficult to control quality. Externalized services must be very careful with this, especially when they are directly dealing with customers.
They must try hard to avoid depersonalization. Internal communication inside a firm is complex, but vital. When there are external agents participating in this strategy, the company must make sure that the objectives are accurately transmitted and communication flows in both directions.
Sometimes, hoteliers are reluctant to leave critical data in the hands of other companies. On the technical level, these data must be secure. In fact, the most important premises regarding computer security are integrity, confidentiality and availability.
This is why some hoteliers prefer to manage information internally. Outsourcing, or not outsourcing, is a decision that depends on the type of hotel and the attitude of each hotelier.
There are very different services that can be outsourced but the most delicate ones are those directly involving clients:Understand the Outsourcing Industry Quickly & Get Actionable Data Easily Key Industries · Latest Market Reports · Competitive Insights · Data-driven Decisions.
Another factor to work the outsourcing within hotel industry is the state of affairs when the external supplier of services is capable to supply economic system and/or higher degree of services because of specialization or cheaper labor.
Outsourcing can assist to salvage resources of the hotel. Outsourcing in the hospitality industry: advantages and disadvantages 17 September, , , Published by Blogger WH 4 Today, we are going to talk about outsourcing. Pros and cons of hospitality outsourcing 26 APRIL AM When done the right way, outsourcing can provide a hotel or company with a host of benefits.
By Elaine Yetzer Simon. “Payroll is the largest cost center for almost all functions within the hospitality industry, so any opportunity to outsource functions that can be. Another factor to work the outsourcing within hotel industry is the state of affairs when the external supplier of services is capable to supply economic system and/or higher degree of services because of specialization or cheaper labor.
Outsourcing can assist to salvage resources of the hotel. And such innovation as outsourcing should have affect the industry in general and the development of hotel sector in particular.
As it has been mentioned above, outsourcing within hotel industry has been the subject of minimal literature research.