The Significance of Improving Productivity in the Hospitality Industry Essay

The Significance of Improving Productivity in the Hospitality Industry - Essay Example Introduction Productivity has a huge impact on all businesses; both individual and corporate. In fact, the hospitality industry is witnessing a steady decline in productivity after World War II, and for many decades the industry effectively hid its poor productivity behind the baby boom in the size of the market. According to estimates, the hospitality industry is only 50% as effective as other industries. Still, it is surprising to note that am effective strategy that could be used to measure the productivity in hospitality industry is not available. This work intends to check why productivity is important in hospitality industry; especially bars and clubs, and also it tries to analyse the existing notion of and attitude towards productivity in the hospitality industry. Thereafter, it tries to suggest some ways that can be adopted to improve productivity in the hospitality industry, especially bars and clubs. The Productivity Paradox of Hospitality Industry The main problem with hos pitality industry, according to scholars, is poor productivity. From studies, it became evident that most people in the hospitality industry possess relatively little idea about the importance of human resources in the hospitality industry. In the opinion of Mill (2010), in hospitality industry, the role of human resources has been undervalued. ... cording to them, despite the best efforts by the hospitality industry to incorporate information technology in operations, there is no evident improvement in productivity. According to them, an important reason for this lack of evidence lies in the fact that there is no effective tool for the measurement of productivity improvement. In addition, it became evident from the study that those who used technology did not use it to improve productivity, but to improve the guest experience. Another serious issue is that different people use different set of criteria to measure productivity (ibid). Similarly, the study by Ingram and Fraenkel (2006) looked into the perception of productivity among hospitality managers. It is pointed out that they possess little idea about the notion of productivity, and the more they tried to understand what productivity is, the more confused they became. The same opinion is revealed by Mill. So, it seems useful to look into the different ideologies on produc tivity. Definition of Productivity and its Measurement In the opinion of Gummesson (1998), it is both ambiguous and inadequate to measure service productivity. However, in the opinion of Reynolds (2004), as about 30% of the hospitality cost comes from labour, a general tendency in the industry is to reduce labour costs while maintaining productivity. However, an article published by the New Zealand Tourism Research Institute warns that the productivity targets achieved in this way will not last long. This is so because reduced costs will lead to a decline in service standards. As Kimes (2001) states, this poor service, in turn, will affect customer satisfaction, which, eventually, will result in poor sales, and finally, poor productivity. There are people like Parasuraman (2002) who argue