Lesson 2: Guestology - A Guide to Quality Service PDF

**LESSON 2: GUESTOLOGY** Many establishments and organizations are doing everything to improve the level of quality service through the performance of the employees. Others develop their systems. Some also embed the concept of corporate culture and environment in their setups. All of these are dee...

**LESSON 2: GUESTOLOGY** Many establishments and organizations are doing everything to improve the level of quality service through the performance of the employees. Others develop their systems. Some also embed the concept of corporate culture and environment in their setups. All of these are deemed effective, but sometimes, what we often forget is that the center of the service concept is our guests. This would be the focus of our study- the concept of Guestology. **GUESTOLOGY** is a term originated by Bruce Laval of The Walt Disney it means that all the organization's employees must treat customers like guests and manage the organization from the guest's point of view "GPOV". The concept that Bruce Laval, the father of guestology, introduced has now become a science that deals with understanding the guest. Dickson (2010) defined guestology as the scientific study of the behaviors, needs, and expectations of people in a service environment, and how to use that knowledge to optimally manage a service organization. Klein (2014) mentioned in her study that guestology involves knowing the guests or clients and their needs and wants, perceptions, and expectations. Her approach toward guestology entails involving every person with whom the service provider has in the workplace.  Guestology changes the way traditional thinking operates. Instead of focusing on maximizing organizational efficiency, guestology approach forces the organization to start everything it does by looking systematically at the guest experience from the customer's or guest's point of view. The goal is to create and sustain an organization that can effectively meet the customer's expectations and still make a profit.  This practice implies that the organization's strategy, staff, and systems are aligned to meet or [exceed the customer's expectations](http://linkedin.com/pulse/importance-guest-experience-wow-gerard-d-manresa?trk=prof-post) regarding the three aspects of the guest experience: [service product, service setting and service delivery.](http://linkedin.com/pulse/habits-make-successful-general-manager-gerard-d-manresa?trk=mp-reader-card) **Importance of Guestology**  It has been proven that guestology makes good business sense; actually, it is the standard in the service industry. When put in practice guestology makes it possible to increase guest satisfaction, which leads to more repeat visits, which in turn drives revenues up.\" **CUSTOMER EXPECTATIONS** are any set of behaviors or actions that individuals anticipate when interacting with a company. Historically, customers have expected basics like quality service and fair pricing --- but modern customers have much higher expectations, such as proactive service, personalized interactions, and connected experiences across digital channels. **Factors influence customer expectations** 1. **Product or service quality:** This refers to the level of performance that customers expect from a company based on their prior experience with the product or service. 2. **Brand reputation:** This is how customers perceive your brand, which is based on their past interactions with you or other people's opinions of your brand. 3. **Price:** The price of your products or services usually sets the bar for what customers expect from you. The more expensive your products, the higher your customers' expectations will be.  4. **Fast Customer Service.** The first thing that customers expect from businesses is fast customer service. Customers want their issues resolved as soon as possible rather than waiting hours to get a response. 5. **Accurate Data by Self-Service.** Customers expect to be able to find the information they\'re looking for quickly and efficiently, without the need to contact customer support every time they have a query. 6. **Easy-to-Use Websites and Apps.** The user experience is a major factor in customer satisfaction. Customers expect rapid loading of websites and easy navigation. If your website and digital [platforms](https://corefy.com/) are difficult to navigate and confusing, your customers will get frustrated and leave.  7. **Personalized Experience.** Customers want to be treated as individuals and receive customized service. They want you to remember their names, preferences, and what they like. 8. **Innovative Product or Service.** Customers not only expect companies to deliver quality products or services that work as advertised, but they also expect better and better offerings. They're always on the lookout for innovative products and services: something unexpected, fresh, new, and exciting.  **What is the hotel guest experience?** The hotel guest experience, ***also known as GX, is the sum total of a guest's interactions with a property and its team members during their stay.*** While the bulk of the guest experience happens on property, beginning with arrival and ending with departure, it also includes pre-stay and post-stay experiences. At each touchpoint in the [customer journe](https://www.cloudbeds.com/articles/traveler-guest-journey-mapping/)y, guests form an impression of their experience that helps them decide whether to recommend the hotel to others and return for future stays. It's, therefore, a top priority for accommodation operators to ensure that all these interactions are pleasant, efficient, and seamless **Stages of the guest experience** How do you ensure your guest experience stands out from competitors? Start by breaking it down into stages that touch on different points in the guest journey. - **Pre-stay** - **In-stay** - **Post-stay** **Six key components of the guest experience** 1. **Convenience. **For most travelers, convenience is about location and proximity to the places they will visit. But it can also mean in-room amenities such as Wi-Fi and entertainment and facilities such as a restaurant, bar, and function space.   2. **Comfort. **Notions of comfort tend to vary by traveler, but everyone wants a comfortable bed and a good night's sleep. Extras may include bathrobes and fluffy towels or a spa and hot tub. For many, comfort is also shaped by how the hotel and its staff make them feel. Do guests feel welcome and safe? 3. **Service. **Service encompasses the helpfulness, efficiency, and attitude of employees and their availability to accommodate guest needs. With great service, hotels can overcome shortfalls in other areas, but it's hard to overcome a negative service experience. 4. **Quality. **Quality refers to the state of the room, facilities, furnishings, food, technology, and equipment. Is it well-maintained and functional or worn out and neglected? If quality is poor, overall impressions are likely to be negative. 5. **Cleanliness.** All travelers expect a clean, tidy environment. During the pandemic, cleanliness became even more important because it was associated with sanitation and safety. 6. **Value.** To assess value, guests weigh pricing against fundamentals like service, quality, and cleanliness. If guests think the property offers good value, they tend to view everything more favorably. If it feels overpriced, they are more critical. **Technology Trends and The Hotel Guest Experience** Technology is transforming the guest experience. ***"In the post-pandemic world, hotel operations are leaner, guests are more self-sufficient, and everyone is more tech-dependent,"*** reports the Cloudbeds' e-book. **Here are just a few [new technology trends](https://www.cloudbeds.com/articles/tech-based-hotel-trends/) that are changing guest experience management:** - **Automation. **Automated features are built into most technology today, enabling software to handle tasks normally performed by employees. This helps ease the burden on hotel staff and improves efficiency and productivity, freeing up employees to handle more complex tasks and dedicate more time to guests. - **Self-service. **During the pandemic, hotel guests became a lot more self-sufficient. At an increasing number of hotels, guests can now check themselves in, enter their rooms, and order a meal using just their smartphones. All without needing assistance from employees. Many guests now prefer to have self-service as an option. - **Contactless services.** The pandemic also accelerated demand for contact-free services like remote check-in and checkout and contactless payments - **Operational tools**. Behind the scenes, hotel technology helps streamline the guest experience by facilitating communications among the front desk, housekeeping, and maintenance teams and replacing manual checklists with automated alerts. - **[Guest messaging](https://www.cloudbeds.com/articles/guest-messaging/). **Guest service has shifted from in-person and phone calls to digital channels like web chat, SMS, and mobile apps for messaging. Today, you can integrate guest engagement and add other integrations to power your guest communications with AI and chatbots, providing guests with instant answers to frequent questions. Another benefit to using a guest messaging platform is you can use it to send upselling notifications such as upgrades or add-ons to increase your revenue opportunities -- a win-win for your guests and your business! - **Cloud-based property management systems (PMS).** To connect all these applications, more hotels are turning to a cloud-based, integrated PMS platform that consolidates data and technology, empowering staff to provide a friction-free guest experience **Here are seven ways to leverage the latest trends and technology to deliver excellence at every stage of the guest experience.** - **Send a pre-arrival message** - **Provide remarkable experiences** - **Perform quality checks** - **Check in with guests** - **Practice service recovery** - **Solicit feedback** - **Invest in technology** **CUSTOMERS, WHO ARE THEY?** Wikipedia defines a **customer** (sometimes known as a client, buyer, or purchaser) as the recipient of a good, service, product or an idea - obtained from a seller, vendor or supplier via a financial transaction or exchange for money or some other valuable consideration. **Five Major Types of Customers** Customers play a significant role in any business. To understand [customer behavior](https://corporatefinanceinstitute.com/resources/economics/consumer-surplus-formula/) and better allocate resources to different customers to generate the highest profit, it is necessary to identify and segment different types of customers. By better understanding the different types of customers, businesses can be better equipped to develop successful strategies. **Five Main Types of Customers** Customers can be segmented into five main types: 1. **Loyal customers**: Customers that make up a minority of the customer base but generate a large portion of sales. 2. **Impulse customers**: Customers that do not have a specific product in mind and purchase goods when it seems good at the time. 3. **Discount customers**: Customers that shop frequently but base buying decisions primarily on markdowns. 4. **Need-based customers**: Customers with the intention of buying a specific product. 5. **Wandering customers**: Customers that are not sure of what they want to buy. 1. **Loyal Customers** Loyal customers are the top priority customer groups and an important segment to appease. Usually, these customers represent 20% of the customer base and also contribute to the major portion of revenue for the company. Loyal customers purchase products or services over a longer period of time and are likely to be brand advocates for the company. The businesses should also obtain feedback from the customers in order to grow the business to a next level. 2. **Impulse customers** These are the second most attractive segment of customers identified by the businesses. You can effectively upsell or cross sell to these customers. Impulse customers buy products and services spontaneously triggered by an impulse. They don't have a shopping list at hand while purchasing. Impulse customers respond to the recommendations and offers. You need to devise strategies to capture these customers in order to make impulse purchases. 3. **Discount customers** Discount customers play a key role in upbringing the company's inventory. The discount customers contribute to the cash flow of the company. These customers look for discounts, seasonal offers and festive offers. Upselling or cross selling to these customers would be a bit difficult and they are considered to be less loyal towards the company. 4. **Need based customers** Need based customers buy products or services driven by a particular need. They come with a shopping list based on their needs and quickly purchase those products from the store. It is quite difficult to upsell to these customers and they are also less loyal to the business. If their need is satisfied better by the competitor's products they will switch to substitute products easily. In order to retain such customers, you need to develop interaction and a positive 5. **Wandering customers** Wandering customers are those customers that make up the crowd in the mall or a shopping complex. They have no specific need/ preference in their mind and just wander the stores for some enjoyment or relaxation. They in particular do not contribute to the profitability of the company. The customers might love the ambience of the store and might stay there just randomly looking for products. These customer segments do not contribute much to the profit of the business. **TASK:** **INDIVIDUAL TASKS** - Select 1 company and conduct online research on how these companies deliver guestology. - Encode your answers using an A4 size paper, 12 font size, arial narrow font style, double spacing - Answers must be in bullet forms. - Deadline of Submission **Points to consider** - Company problems - Strengths, Weaknesses, Opportunities, Threats - Solutions Made **Focus on Excellent Guest Experiences:** - The Ritz-Carlton: Crafting a Culture of Personalized Service - Disneyland: Where Magic Meets Exceptional Guest Experience - Zappos: Building a Brand on Customer Delight - Airbnb: Revolutionizing Hospitality Through Community and Trust - The Four Seasons: Delivering Unforgettable Experiences Through Attention to Detail - Apple: Creating a Seamless and Intuitive Customer Journey - Starbucks: Building a Loyal Following Through Personalized Connections - The Peninsula Hotel: Embracing Tradition and Modern Luxury - The Dorchester: A Legacy of Timeless Elegance and Service - The Mandarin Oriental: Cultivating a Culture of Personalized Luxury **Focus on Guest Complaints and Recovery** - United Airlines: From Crisis to Recovery - Learning from a Public Relations Disaster - Domino\'s Pizza: Turning a Negative Reputation into a Success Story - Southwest Airlines: How to Handle Delays and Disruptions with Grace - Amazon: Navigating Customer Complaints in a High-Volume E-commerce Environment - Netflix: Addressing Subscription Cancellations and Maintaining Customer Loyalty - Uber: Responding to Safety Concerns and Maintaining Public Trust - The Marriott: Managing Guest Complaints in a Global Hotel Chain - The Ritz-Carlton: The Art of Apology and Compensation - The Peninsula Hotel: Handling Guest Complaints with Discretion and Empathy - The Mandarin Oriental: Restoring Trust After a Service Failure To bridge the gap between the expectation and perceptions of a guest in the tourism and hospitality setting, it is a must to plan the experience carefully. With these critical planning is very much important to properly design and ensure that the best experience is the only experience a guest will receive. In order to bridge the gap between a guest\'s expectations and perceptions in a hospitality or tourism setting, the experience must be carefully planned. A successful guest encounter is anticipated to result in the best possible experience. With this, critical planning is required to create and ensure that a guest\'s best experience is the only one they will have In order to bridge the gap between a guest\'s expectations and perceptions in a hospitality or tourism setting, the experience must be carefully planned. A successful guest encounter is anticipated to result in the best possible experience. With this, critical planning is required to create and ensure that a guest\'s best experience is the only one they will have To bridge the gap between the expectations and perceptions of a guest in a hospitality and tourism setting, it is a must to plan his/ her experience carefully. A productive guest encounter is expected to yield optimum experience. With these, critical planning is very much important to properly design and ensure that the best experience is the only experience a guest will receive. **The Concept of Strategy** In order to bridge the gap between a guest\'s expectations and perceptions in a hospitality or tourism setting, the experience must be carefully planned. A successful guest encounter is anticipated to result in the best possible experience. With this, critical planning is required to create and ensure that a guest\'s best experience is the only one they will have The word "strategy" is derived from the Greek word "strategos"; stratus (meaning army) and "ago" (meaning leading/moving). **Strategy** is an action that managers take to attain one or more of the organization's goals. Strategy can also be defined as "*A general direction set for the company and its various components to achieve a desired state in the future. Strategy results from the detailed strategic planning process*". A strategy is all about integrating organizational activities and utilizing and allocating the scarce resources within the organizational environment so as to meet the present objectives. **Strategy is the blueprint of decisions** in an organization that shows its objectives and goals, reduces the key policies, and plans for achieving these goals, and defines the business the company is to carry on, the type of economic and human organization it wants to be, and the contribution it plans to make to its shareholders, customers and society at large. ### **Features of Strategy** 1. Strategy is Significant because it is not possible to foresee the future. Without a perfect foresight, the firms must be ready to deal with the uncertain events which constitute the business environment. 2. Strategy deals with long term developments rather than routine operations, i.e. it deals with probability of innovations or new products, new methods of productions, or new markets to be developed in future. 3. Strategy is created to take into account the probable behavior of customers and competitors. Strategies dealing with employees will predict the employee behavior. **Strategy is a well-defined roadmap of an organization**. It defines the overall mission, vision and direction of an organization. The objective of a strategy is to maximize an organization's strengths and to minimize the strengths of the competitors. Strategy, in short, **bridges the gap between "where we are" and "where we want to be"**. COMPONENTS OF A STRATEGY STATEMENT ================================== The strategy statement of a firm sets the firm's long-term strategic direction and broad policy directions. It gives the firm a clear sense of direction and a blueprint for the firm's activities for the upcoming years. The main constituents of a strategic statement are as follows: ### **Strategic Intent** An organization's strategic intent is the purpose that it exists and why it will continue to exist, providing it maintains a competitive advantage. Strategic intent gives a picture about what an organization must get into immediately in order to achieve the company's vision. It motivates the people. It clarifies the vision of the vision of the company. ### **Mission Statement** Mission statement is the statement of the role by which an organization intends to serve it's stakeholders. It describes why an organization is operating and thus provides a framework within which strategies are formulated. It describes what the organization does (i.e., present capabilities), who all it serves (i.e., stakeholders) and what makes an organization unique (i.e., reason for existence). ### **Features of a Mission** a. Mission must be **feasible** and attainable. It should be possible to achieve it. b. Mission should be **clear** enough so that any action can be taken. c. It should be **inspiring** for the management, staff and society at large. d. It should be **precise** enough, i.e., it should be neither too broad nor too narrow. e. It should be **unique** and distinctive to leave an impact in everyone's mind. f. It should be **analytical**,i.e., it should analyze the key components of the strategy. g. It should be **credible**, i.e., all stakeholders should be able to believe it. ### **Vision Statement** A vision statement identifies where the organization wants or intends to be in future or where it should be to best meet the needs of the stakeholders. It describes dreams and aspirations for future. An effective vision statement must have following features- a. It must be **unambiguous**. b. It must be **clear**. c. It must **harmonize** with organization's culture and values. d. The dreams and aspirations must be **rational/realistic**. e. Vision statements should be **shorter** so that they are easier to memorize. In order to realize the vision, it must be deeply instilled in the organization, being owned and shared by everyone involved in the organization. ### **Goals and Objectives** a. These are **precise and measurable**. b. These look after **critical and significant** issues. c. These are **realistic** and challenging. d. These must be achieved within a **specific time** frame. e. These include both **financial as well as non-financial components**. f. These are not single for an organization, but **multiple**. g. Objectives should be both **short-term as well as long-term**. h. Objectives must respond and react to changes in environment, i.e., they must be **flexible**. i. These must be feasible, **realistic and operational**. **What is Strategic Planning?** ------------------------------- Strategic planning is an organizational management activity that is used to set priorities, focus energy and resources, strengthen operations, ensure that employees and other stakeholders are working toward common goals, establish agreement around intended outcomes/results, and assess and adjust the organization's direction in response to a changing environment. A strategic plan is a document used to communicate with the organization the organizations goals, the actions needed to achieve those goals and all of the other critical elements developed during the planning exercise. STRATEGIC MANAGEMENT PROCESS ============================ The strategic management process means defining the organization's strategy. It is also defined as the process by which managers make a choice of a set of strategies for the organization that will enable it to achieve better performance. **Strategic management process has following four steps:** 1. **[Environmental Scanning](https://www.managementstudyguide.com/environmental-scanning.htm)-** Environmental scanning refers to a process of collecting, scrutinizing and providing information for strategic purposes. 2. **[Strategy Formulation](https://www.managementstudyguide.com/strategy-formulation-process.htm)-** Strategy formulation is the process of deciding best course of action for accomplishing organizational objectives and hence achieving organizational purpose. 3. **[Strategy Implementation](https://www.managementstudyguide.com/strategy-implementation.htm)-** Strategy implementation implies making the strategy work as intended or putting the organization's chosen strategy into action. 4. **[Strategy Evaluation](https://www.managementstudyguide.com/strategy-evaluation.htm)-** Strategy evaluation is the final step of strategy management process. WHO IS MICHAEL PORTER? =========================================== **Michael Porter is the founder of the modern strategy field and one of the world's most influential thinkers on management and competitiveness**. The author of 19 books and over 130 articles, he is the Bishop William Lawrence University Professor at Harvard Business School and the director of the school's Institute for Strategy and Competitiveness, which was founded in 2001 to further his work and research. =========================================================================================================================================================================================================================================================================================================================================================================================================================== Michael Porter has been widely recognized for his work. Some of his many honors include Harvard\'s David A. Wells Prize in Economics (1973) for his research in industrial organization. He also received the Graham and Dodd Award of the Financial Analysts Federation in 1980. Michael Porter\'s book Competitive Advantage won the George R. Terry Book Award of the Academy of Management in 1985 as the outstanding contribution to management thought. ============================================================================================================================================================================================================================================================================================================================================================================================================================================================= Porter\'s Generic Strategies Which do you prefer when you fly: a cheap, no-frills airline, or a more expensive operator with fantastic service levels and maximum comfort? And would you ever consider a small company with just a few routes? The choice is up to you, of course. But the point we\'re making here is that when you come to book a flight, there are some very different options available. Why is this so? The answer is that each of these airlines has chosen a different way of achieving competitive advantage in a crowded marketplace. Porter called the generic strategies - Cost Leadership (no frills), - Differentiation (creating uniquely desirable products and services) and - Focus (offering a specialized service in a niche market). He then subdivided the Focus strategy into two parts: \"Cost Focus\" and \"Differentiation Focus.\" - Cost focus means emphasizing cost-minimization within a focused market - Differentiation focus means pursuing strategic differentiation within a focused market ### **THE COST LEADERSHIP STRATEGY** Porter\'s generic strategies are ways of gaining competitive advantage -- in other words, developing the \"edge\" that gets you the sale and takes it away from your competitors. There are two main ways of achieving this within a Cost Leadership strategy: - Increasing profits by reducing costs, while charging industry-average prices. - Increasing market share by charging lower prices, while still making a reasonable profit on each sale because you\'ve reduced costs. **Remember that Cost Leadership is about minimizing the cost to the organization of delivering products and services. The cost or price paid by the customer is a separate issue!** Companies that are successful in achieving Cost Leadership usually have: - Access to the capital needed to invest in technology that will bring costs down. - Very efficient logistics. - A low-cost base (labor, materials, facilities), and a way of sustainably cutting costs below those of other competitors. ### **THE DIFFERENTIATION STRATEGY** Differentiation involves making your products or services different from and more attractive than those of your competitors. How you do this depends on the exact nature of your industry and of the products and services themselves, but will typically involve features, functionality, durability, support, and also brand image that your customers value. To make a success of a Differentiation strategy, organizations need: - Good research, development and innovation. - The ability to deliver high-quality products or services. - Effective sales and marketing, so that the market understands the benefits offered by the differentiated offerings. ### **THE FOCUS STRATEGY** Companies that use Focus strategies concentrate on particular niche markets and, by understanding the dynamics of that market and the unique needs of customers within it, develop uniquely low-cost or well-specified products for the market. Because they serve customers in their market uniquely well, they tend to build strong brand loyalty amongst their customers. This makes their particular market segment less attractive to competitors Cost Leadership requires a very detailed internal focus on processes. Differentiation, on the other hand, demands an outward-facing, highly creative approach.  When you come to choose which of the three generic strategies is for you, it\'s vital that you take your organization\'s competencies and strengths into account. ### **Step 1:** For each generic strategy, carry out a [**SWOT Analysis **](https://www.mindtools.com/amtbj63/swot-analysis) of your strengths and weaknesses, and the opportunities and threats you would face, if you adopted that strategy. SWOT analysis is a framework for identifying and analyzing an organization\'s strengths, weaknesses, opportunities and threats. SWOT analysis is often used either at the start of, or as part of, a [strategic planning](https://www.techtarget.com/searchcio/definition/strategic-planning) process. The framework is considered a powerful support for decision-making because it enables an organization to uncover opportunities for success that were previously unarticulated. It also highlights threats before they become overly burdensome. SWOT analysis can identify a market niche in which a business has a [competitive advantage](https://www.techtarget.com/searchcio/definition/competitive-advantage). It can also help individuals plot a career path that maximizes their strengths and alert them to threats that could thwart success. ### **Step 2:** Use [**Five Forces Analysis **](https://www.mindtools.com/community/pages/article/newTMC_08.php) to understand the nature of the industry you are in. **What are Porter\'s Five Forces?** ----------------------------------- Porter\'s Five Forces is a framework for analyzing a company\'s competitive environment. It was created by Harvard Business School professor Michael E. Porter in 1979 and has since become an important tool for managers. Porter\'s Five Forces is a model that identifies and analyzes five competitive forces that shape every industry and helps determine an industry\'s weaknesses and strengths. According to Porter, there are five forces that represent the key sources of competitive pressure within an industry They are: 1. **Competitive Rivalry.** Competition in the industry The larger the number of competitors, along with the number of equivalent products and services they offer, the lesser the power of a company. 2. **Supplier Power.** Power of suppliers It is affected by the number of suppliers of key inputs of a good or service, how unique these inputs are, and how much it would cost a company to switch to another supplier. The fewer suppliers to an industry, the more a company would depend on a supplier. 3. **Buyer Power.** Power of customers. It is affected by how many buyers or customers a company has, how significant each customer is, and how much it would cost a company to find new customers or markets for its output. 4. **Threat of Substitution.** Threat of substitute products. It is affected by how many buyers or customers a company has, how significant each customer is, and how much it would cost a company to find new customers or markets for its output. 5. **Threat of New Entry.** Potential of new entrants into the industry A company\'s power is also affected by the force of new entrants into its market. The less time and money it costs for a competitor to enter a company\'s market and be an effective competitor, the more an established company\'s position could be significantly weakened. ### **Step 3:** Compare the SWOT Analyzes of the viable strategic options with the results of your Five Forces analysis. For each strategic option, ask yourself how you could use that strategy to: - Reduce or manage supplier power. - Reduce or manage buyer/customer power. - Come out on top of the competitive rivalry. - Reduce or eliminate the threat of substitution. - Reduce or eliminate the threat of new entry. **References:**