9-1 Final Project Submission: Business Development PlanAssignmentUpdatedIn this submission, you will finalize the process of creating a business development plan for your selected organization or comp

Business Development Plan for Marriott International Inc

Darlene Ames

QSO 690

December 24th, 2017

Business Development Plan for Marriott International Inc

Introduction

Marriott International Inc manages a broad portfolio of hotels and lodging facilities in different countries in the world. In addition, the company manages other properties under long-term leases agreements with property owners. Besides, On November 15th, 2015 Marriott international Inc enters into merger agreements to combine Starwood hotels and resorts worldwide. The merger adds Starwood hotels and resorts to the list of subsidiary companies associated with Marriott International Inc. The purpose of this business development plan is to analyze the current operation process and recommend some lean practices and other technological advancements as a market strategy of gaining a competitive edge in the markets.

Current Operation Processes:

Marriott International Inc is a hotel industry which is characterized by high capital cost and a high proportion of fixed cost to total cost. Currently, the company has entered into agreements with various property owners through leasing the property for certain period and merging with other hotels. Most of the hotel acquired by either merger or lease by the company has impacted huge cost to the company operation. This is because the company has to construct, furnish the hotel with equipment and other necessities. Hotel or rooms are built in such a way that they optimize size in order to benefits from economies of scale.

The daily operation of the company entails filling the hotel's rooms and offering other catering services to the occupant. The company faces various competitions from other hotels in the region and especially those hotels who share the same status. The tariffs applied are determined in accordance with the level of differentiation through location, management, staff and guest ratios. The success of the company lies in the effectiveness of the management and the experiences of its workforce. The company has differentiated its services to several categories such as classic luxury and distinctive luxury, classic premium and distinctive premium, classic select and distinctive select and lastly classic larger stays and distinctive larger stay.

These services target different customers who may wish to visit the company list of hotels. The company has over 400 international purchasing agreements with suppliers and the contract ranges from a period of two years to a period of three years. The acquisition of Starwood hotels and resort also added the Marriott Company another global agreement. Starwood had a contract with LG and Samsung which provided TVs sets and display screens for Starwood Hotels and Marriott. The Marriott international Inc negotiated the contract in order to have streamlined supply process (Nell Walker, 2017). The company earns its income from food and beverage, exhibition and convection and other income generating variables.

Business development opportunities:

There various business opportunities which Marriott international Inc can utilize in order to gain a competitive edge in the market as well as reducing the organization infrastructure cost. Those business opportunities include employing lean techniques, just in time practices, optimizing production technology and theory of constraints. All these business opportunities will help in reducing cost related to production, inventory, and supply chain. As a result, the business opportunities will help to improve organization effectiveness in its operation hence impacting organization brand images. Effective and efficient operations will lead to high level of customer satisfaction as well as high level of customer's retention level. The end results of all these business opportunities will lead to high-profit margin.

Business strategies Applied to reducing Infrastructure cost and waiting time.

Marriott International Inc incurs various infrastructure cost related transportation, communication, information and technology and supply chain processes. Also, other costs relate to the acquisition of various hotels, leasing cost, and real estate's cost. In order to reduce and eliminates some of this cost, Marriott international Inc can utilize the lead technique practices.

Lead Technique Practices

This technique helps in enhancing overall customers experience and focuses on reduction or complete elimination of seven types of wastes. Those types of wastes may include transport, inventory, motion, waiting time, overproduction, over-processing and defects. Marriott International Inc offers services in terms of lodging services and goods in terms of serving customers with food and beverages. Inventory cost can be reduced by using lead inventory management techniques. These concepts targets on identifying and eliminating wastes of materials, efforts and time through continuous improvements and the pursuit of perfection. The lead management techniques emphasize on-demand managements (Garvey, Dismore, & Dismore, 2004).

Marriott International Inc should provide inventory when requested by the customers. The customers' orders for food and beverage should be ordered from suppliers according to customers' orders for the products especially those slow-moving products. On other hands, Marriott international Inc may have an inventory in its store which has less demand and the company is putting the inventory in order to cater for those few customers who like to use the products. In order to reduce the stock cost, the company may decide to order the stock according to customers’ orders. This can be effectively implemented by allowing customers indicates the food staff and beverage they would like to use when they visit the hotel.

The fast-moving food can be ordered according to demand in order to avoid inconvenience. Also, Marriott can decide to charge higher cost on those inventories so that the cost of holding them may not surpass the profit they will gain after they sell off the inventory to the customers. This technique helps in reducing cost relating to material cost. Marriott International Inc can reduce waiting time in its operations by eliminating chokepoint in the organization operates. That checkpoint may include poor table layout which may create bottlenecking and lead to congestion of foot traffic.

The company can arrange the seat in a way that it will provide enough space for waiters and waitress to deliver foods and seat customers. The design of the hotel should be spacious enough in order to allow easy movements. Improving foot traffic will help in improving customer's satisfaction hence improving customer's retention level. Also, the company can utilize digital dining system in order reduce waiting time. Customers waste valuable time while delivering bills and are distracted from other tasks on the process. Marriott International Inc can allow customers to pay at their table through automated system hence reducing congestion and waiting times for orders (Vidotto, Brown, & Beck, 2007).

Beside, Marriott international Inc can reduce defects in its operation by ensuring the organization adopts lean techniques of reducing wastes. Marriott International Inc offers services and goods at ago and therefore the lean methods can be effectively be implemented in its operation. The physical products of most manufacturing firm keep their value while held as inventory but in restaurant types of services, the work in process in restaurants is a waste of assets. The product of this restaurant has shelf life limits and therefore they cannot be stored for long. The products inventory quality for food diminishes with time and therefore Marriott international Inc should ensure the food inventory is ordered according to demand in order to reduce wastes.

Just In Time Practices

Also, Marriott International Inc can as well utilize Just in time (JIT) practices such as safety stock, reduce the cost of inventory. Marriott International Inc can employ just in time practices as an inventory strategy in order to increase efficiency and decrease wastes by receiving goods only when they are needed in the production process and reducing inventory cost. This method allows Marriott international Inc forecast demand especially in the period of high demand like holidays. Older just in time practices entails caring large inventory during a season of high demand but new just in time requires manufacturers and services sectors to forecast for the demand then order what the firm will use during that period.

Elements which can be applied in just in time practices include design flow, total quality management, Waste elimination, Vendor management and process design. Marriott International Inc uses industrial grade equipment's that withstand busy restaurant schedule especially in the season of high demand. The company activities can be effectively be implemented if the design and the layout of the kitchen and other areas allow food to flow seamlessly. The organization can decide to leases some of the company equipment's like ice machines because they don't last for long instead of buying brand new machines which are too expensive. Marriott International Inc can improve customer satisfaction by employing TQM techniques.

This technique focuses on quality initiative whereby the company can utilize in selecting and training frontline staff (Sripun, & Ladkin, 2001). Frontline staff includes customer's cares who interact with customers on a daily basis. The frontline staff experience and skill help to build organization brand images or destroy it. Therefore an organization should ensure the front line staffs have super skill in order to improve customer’s retention level.

Optimized production technology and theory of constraints business strategies

Additionally, Marriott international Inc can optimize on production technology and theory of constraints in order to reduce cost and support the organization current operation. Optimized production technology is computerized production planning and scheduling tool. This tool was developed in order to improve bottleneck processes. Theory of constraints focuses on capacity constraints and how an organization can improve bottleneck operation. Marriott International Inc can improve its bottleneck operation by identifying the location of constraints and then develop some strategies to remove them. This constraint prevents an organization from achieving high performance relative to its goals (Plenert, 1993). Constraints can be a burden when an organization has to rework on some of the products.

As a result, more hours may be employed than anticipated. Besides, lack of certain inputs needed in production may lead to slow process hence leading to less production. Marriott international may incur this problem when waiters fail to stick to customer’s specification. Customers may return the order then specify on what should be included in their food. In order to reduce these bottleneck constraints, Marriott international Inc operation managers may decide to advise waiter to be keen on orders in order to avoid defects and job repetition. The implementation of the theory of constraints, optimized production technology, and capacity constraints resources strategies will help in ensuring that there is neither bottleneck nor non-bottleneck.

References

Bond, T. C. (1993). An investigation into the use of OPT production scheduling. Production Planning & Control, https://link.springer.com/article/10.1007/s10845-004-5890-x

Vidotto, A., Brown, K. N., & Beck, J. C. (2007). Managing restaurant tables using constraints. Knowledge-Based Systems, https://www.deepdyve.com/lp/elsevier/managing-restaurant-tables-using-constraints-hO8cmTuAjo

Plenert, G. (1993). Optimizing theory of constraints when multiple constrained resources exist. European Journal of Operational Research, https://www.researchgate.net/publication/223292964_Theory_of_constraints_and_the_combinatorial_complexity_of_the_product-mix_decision

Nell Walker, (2017). How Marriott has achieved the mammoth task of streamlining its worldwide supply chain. [Supply Chain Article]: Retrieved from http://www.supplychaindigital.com/company/how-marriott-has-achieved-mammoth-task-streamlining-its-worldwide-supply-chain

OZALP, I., Suvaci, B., & TONUS, H. Z. (2010). A New Approach to Logistics Management: Just in time-Logistics (JIT-L). http://studylib.net/doc/8405530/37-a-new-approach-in-logistics-management--just-in#

Sripun, M., & Ladkin, A. (2001). Total quality management and tourism and hospitality education: the case of Thailand. Journal of Quality Assurance in Hospitality & Tourism, http://www.tandfonline.com/doi/abs/10.1300/J162v02n01_06?needAccess=true&journalCode=wqah20

Garvey, M., Dismore, H., & Dismore, A. (2004). Running a restaurant for dummies. Hoboken, NJ: Wiley Pub.