1 Hospitality Industry
1.1 Defining the Hospitality Industry
When we think of the hospitality industry, we usually think only of hotels and restaurants. However,
the term has a much broader meaning. The word hospitality is derived from hospice, an old French
word meaning “to provide care or shelter for travelers”. A hospice was also a medieval “house of rest”
for travelers and pilgrims and an early form of what is now called a nursing home.
According to the
Oxford English Dictionary
, hospitality means “the reception and entertainment of
guests, visitors and strangers with liberality and good will.”
Webster’s Ninth New Collegiate
Dictionary
defines hospitality as “those businesses which practice the act of being hospitable; those
businesses which are characterized by generosity and friendliness to guests.”
Hospitality is, then, an umbrella term covering a variety of businesses, including restaurants, hotels,
resorts and casinos.
It also refers to other kinds of institutions that offer shelter or food or both to
people away from their homes. The hospitality product includes both tangible goods (rooms, meals)
and intangible services. Both are needed to success. However, making a guest, client or resident
welcome and comfortable is the main goal of the hospitality industry.
The hospitality sector has undergone significant change in the last 20 years or so. Quite simply, an
increasing number of people are eating out more often and more people are using hotel facilities for
getaways or for leisure or business and conference activities.
Nowadays, the hospitality industry is probably the world’s fastest-growing, job-creating profession,
employing one in ten people worldwide. It is a major player within the global economy. The World
Travel and Tourism Council (WTTC) has estimated that in 2004, the travel and tourism economy
represented 10.4% of the global economy (this includes suppliers). The WTTC has also estimated that
the global travel and tourism economy created almost ten million new jobs in 2004.
1
Structure of the industry
:
1
Hospitality Journal
. December/January, 2004/2005
experience of the customers. When a server acts like a machine, parroting banal phrases, or is unable
or unwilling to solve problems when they occur, the service experience is a poor one.
1.3 The Focus on the Hotel Business
Because the hospitality industry includes so many different types of businesses, this Master’s thesis
focuses only on the hotel business that represents the major segment of the industry.
The hotel industry has been changing and developing since the very beginning. It was mainly
improved transportation that changed its nature from small independently owned inns to large hotels
and motel chains. The industry has followed the changing patterns of transportation and destinations.
Downtown hotels once served railroad passengers and still serve the needs of travelers who have
business or entertainment interests in the center city. Motels and motor hotels serve people traveling
by car, as airport hotels do for air passengers. In the past, although differences in quality and price
existed, most hotels provided products and services for the entire market. Now the hotel business
responds not only to changing transportation and destination patterns but also to the changing needs of
travelers, producing markedly different products for different market segments. In addition, owing to
the enormous increase in tourism worldwide during the last decades of the 20
th
century, standards have
improved considerably.
The primary function of a hotel is to provide lodging to people away from their homes, usually on a
short-term basis. In addition to standard services, hotels often provide additional guest services such as
restaurants, swimming pools or child care. Some hotels have even conference facilities and encourage
groups to hold conventions and meetings at their location. Much depends upon the size and purpose of
the hotel.
The size also influences the organizational structure of a hotel. Like any large company, a large hotel
has specific departments. Each department is responsible for a particular set of functions in order to
efficiently provide services to the guest. The end result for a hotel operation is a satisfied guest
achieved only by the cooperation of all departments and employees. The major departments of a large
hotel are rooms division, food and beverage, marketing and sales, human resources, accounting and
engineering. They are lead by directors who report to a hotel general manager. The midscale and
smaller hotels are less complex in their organizational structures. However, someone must be
responsible for each of the key result areas that make the operation successful.
Hotels can be classified according to various criteria such as price range (luxury, midscale, budget or
economy), the five-star classification, function (resorts, health spas, meeting, conferences), location
(city center, resort, airport, freeway), according to the types of services offered (convention, casino),
and distinctiveness of style (historic, bed-and-breakfast). The cost and quality of hotels are usually
indicative of the range and type of services available there.
Classification of accommodation facilities – ranking in classes according to the international
categorization:
1) * Tourist
2) ** Economy
3) *** Standard
4) **** First Class
5) ***** Luxury
The accommodation facilities of the category of garni hotel, bed & breakfast and motel can receive
four stars maximum.
Regardless of the category, hotels or other kinds of accommodation facilities are a service industry
with the goal of meeting and exceeding customers’ expectations.
