Operational Analysis for Improving Performance of Wheatley Park Hotel Essay

Operational Analysis for Improving Performance of Wheatley Park Hotel - Essay Example This essay stresses that the current effective capacity strategy of the hotel is operating at the 60% occupancy where excellent service was expected from the staff. A level capacity strategy does not vary the amount of resources supplied. At Wheatley Park Hotel, the staffs are kept at a constant level regardless of the demand pattern. This strategy has created subsequent problems with the hotel such as staff wages, overtime pays, congestion and overall high operations costs. A problem at Wheatley Park Hotel is its laundry equipment. The machine is old and suffered frequent break-downs. As a result, the cost of laundry operation is high and rising. Cost for breakdown maintenance call-out of  £800 is added to the weekly running cost of laundry operation at  £1000. Consequently, it affects other operations in the hotel such as the changing of bed linens and towels. This paper makes a conclusion that the current trend of hotels is to employ yield management strategy in their reservations. Yield management is the management the amount of revenue that a unit of capacity generates to the business. In the hotel setting, the unit capacity is one room. Currently, the hotel has a yield contribution of  £100. By implementing yield management strategy, the hotel can increase the contribution of the room as well as increase its occupancy. The steps involves determining the best customer who are willing to pay more, buy more, and remain more loyal.