var
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`\/NR’S ENCYCLOPEDIA
`
`of
`
`HOSPITALITY
`
`_._..._,i...__.i_m___
`
`61i
`
`TOURISM
`
`Edited by
`Mahmood A. Khan
`
`Virginia Pobrtecbnic Institute
`
`and State University
`
`Michael D. Olsen
`
`Virginia Polytechnic Institute
`
`and State University
`
`Turgut Var
`
`Texas A&M University
`
`VAN NOSTRAND REINHOLD
`New York-
`
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`
`
`Copyright © 1993 by Van Nostrand Reinhold
`Library of Congress Catalog Card Number 92-40238
`ISBN o_442—oo3-45-3
`
`All rights reserved. No part of this work covered by the copyright
`hereon may be reproduced or used in any form or by any means—graphic,
`electronic, or mechanical, including photocopying, recording, taping, or
`information storage and retrieval systemswwithout written permission
`
`Printed in the United States of America.
`
`Van Nostrand Reinhold
`
`New York, New York 10003
`
`Chapman and Hall
`2-6 Boundary Row
`London, SE1 BHN, England
`Thomas Nelson Australia
`
`South Melbourne 3205
`Victoria, Australia
`
`1120 Birchmount Road
`
`Scarborough, Ontario MIK 5C4, Canada
`
`I6I514131211I098765432]
`
`Library of Congress Cataloging-in-Publication Data
`VNR's encyclopedia of hospitality and tourism/[edited by] Mahmoud A.
`Khan, Michael D. Olsen, Turgut Var.
`
`lSBN 0-44}-00346-3
`
`2. Food service
`I. Hospitality industry—Encyclopedias.
`managernent—Encyc!opedias.
`3. Hotel management—Encyclopedias.
`4. Tourist trade——Encyclopedias.
`l. Khan, Mahmood A.
`ll. Olsen,
`III. Var, Turgut.
`I992
`
`92-40238
`
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`
`
`Contents
`
`ix
`Preface
`Contributors
`
`xi
`
`Part 1: Foodservice Management
`The Restaurant and Foodservice Industry 3
`William P Fislaer
`
`Market Feasibility
`
`15
`
`Audrey McCool
`Foodservice Operations Management
`Peter Jones
`
`27
`
`Food and Beverage Management
`Robert B. Lane
`
`37
`
`Site Selection for a Foodservice Operation
`David Kirk
`
`49
`
`54
`
`Restaurant Design
`Carolyn U. Lamlveri
`Equipment Selection
`Malamoocl A. Khan
`
`63
`
`Kitchen Planning 69
`David Kirk
`Consumer Food Preferences
`
`77
`
`Barbara A. Almanza
`
`16 Fundamentals of Foodservice Sanitation
`N. G. Marriott
`
`133
`
`17 Quality Assurance in Poodservice
`Morton Fox
`18 Cost Control in Foodservice
`
`156
`
`148
`
`James Kaiser
`
`19 Food Safety
`
`174
`
`Marian C. Spears
`20 Hazard Analysis and Critical Control Point
`in Foodservice
`135
`
`O. P. Snyder, Jr.
`21 Human Resources
`
`220
`
`Harold Lane
`
`22 College and University Foodservice
`Frederick J’. DeMicco
`
`226
`
`23 Institutional Foodservice Management
`
`241
`
`Mickey Warner
`24 Foodsea-vice Franchising 251
`
`Slop Swmllow
`25 Computers in the, Foodservice Industry 258
`Miclaael L. Kasavana
`
`Nutrition in the Foodservice Industry 32
`Diane Welland
`
`Menus and Menu Planning 85
`Malamood A. Khan
`
`Foodservice Purchasing 103
`Iolm Siefanelli
`Food Production and Recipe Standardization 109
`Dellorala H. Sutlaerlin
`The Cool<—Chil1 Food Production Process
`Claudia G. Green
`
`120
`
`Food Storage
`Iolcm Stefanelli
`
`129
`
`Part 2: Hotel Management
`I Strategic Management
`Michael Olsen
`
`2 Financial Management
`Francis A. Kwansa
`
`281
`
`288
`
`3 Operations Budgeting 296
`Raymond 5. Schmfdgall
`4 Organizational Management
`Craig C. Luncllverg
`5 Marketing in the Lodging Industry 316
`Robert C. Lewis
`
`306
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`6 Marketing Management
`Ken W. McCleary
`7 Hospitality Law 332
`
`324
`
`John E. H. Sherry
`Lodging Operations
`Peter Jones
`
`33?
`
`Organization Structure in the Hospitality
`Industry 347
`Eliza China-Yick Tse
`The Multinational Firm 354
`Frank M. Go
`
`Franchising and the Lodging lndustry 366
`Joseph E. Lapin and Dallas 5. Luncejforal
`Conference Centers
`373
`
`Key-Sang Chan
`Overview of the Conventions, Expositions,
`and Meetings lndustry: A Major Hotel Market
`Denny G. Rutherford
`Branding in the Hospitality Industry 390'
`Simon Crawford-Welsh
`39.9
`
`Suzanne K. Marrmann and Chen’ Becker Suttle
`Individual Unit Hotel Management
`407
`Eddysione C. Nehel HI
`
`Front Office Operations
`Michael L Kasauana
`Hotel Sales
`433
`
`423
`
`31
`
`Security for the Hospitality Industry 514
`Robert J. Martin
`
`32 Maintenance and Engineering
`in the Hospitality lndustry 524
`Frank Borsenilt
`
`Part 3: Travel and Tourism
`1
`
`Defining Tourism and Related Concepts: Tourist,
`Market, Industry, and Tourism System 539
`Neil Leiper
`Leisure, Recreation, and Tourism 559
`Laurel J. Reid, Robert W. McLellan, and Muzayfifer Uysal
`Travel and Tourism Law 567
`Ronald A. Kaiser
`
`379
`
`The Anthropology of Tourism 594
`Robert V Kemper
`Sociology of Tourism 613
`Erik Cohen
`
`Cultural lrnpact of Tourism 619
`Pierre L. van den Berghe
`Demonstration Effect
`Valene L. Smith
`
`629
`
`Encounters in Tourism 636
`Keith Hollinshead
`
`Ethnocentrism in Tourism 552
`Keith Hollinshead
`
`Howard Feiertag
`Occupancy Rates in the Hospitality Industry 438
`Giles Jackson
`
`447
`Average Daily Rate
`Bvsan Mnrihy and Cheleitan 5. Dev
`Hotel Pricing 453
`Margaret Shaw
`
`4531
`
`Safety Management
`Raymond C. Ellis, fr.
`Property Management Systems
`James A. Bareli
`
`465
`
`Reservation Systems
`Paul R. Gamhle
`
`471
`
`Guest Registration
`Tom Van Dyke
`Checkout
`432
`
`478
`
`Melvi'n N. Barr1'n_r]ton
`Guest Services
`437
`
`Richard Teare and Martin Senior
`Amenities
`495
`
`29 Hotel Room Service
`
`502
`
`L. Taylor Damonte
`30 Hotel Food and Beverage
`
`506
`
`I0
`
`11
`
`12
`
`13
`
`I4
`
`15
`
`16
`
`I7
`
`l8
`
`lnput«Output Analysis: Applications to the Assessment
`of the Economic Impact of Tourism 663
`Thomas W. Blaine
`
`Elasticity of Tourism Demand 671
`Golan: Mohammad
`
`679
`
`Tourism Forecasting:
`State-of—the—Art Techniques
`Turgut Var and Choong-Ki Lee
`Forecasting: The Econometric Approach 697
`Stephen F. Witt
`Seasonality 705
`Raphael Raymond Bar-On
`Statistical Measurements in Tourism 735
`Willi'am .3. Strange
`Government's Role in Strategic Planning
`for Tourism 746
`Salah E. A. Wahah
`
`Tourism Infrastructure and Development
`Clare A. Gnnn
`'
`
`754
`
`Elements of Community Tourism Development
`Planning Process
`773
`Leland L. Nicholls
`
`'
`
`l9
`
`Sustainable Tourism Development
`James R. MacGregor
`20 Urban Tourism 790
`
`781
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`Motivation of Pleasure Travel and Tourism 798
`Muzaffer Uysal and Lee Anne R. Hagan
`Pleasure Travel and Destination Choice
`Seal:-o Um
`
`814
`
`Religious Tourism 822
`Kadir H. Din
`
`Information Search by Pleasure Travelers
`David Snepenger and Mary Snepenger
`International Tourism 836
`Robert ClJristie Mill
`
`830
`
`International Airlines and Tourism: Opportunities
`and Challenges
`851
`Kevin B. Battery and Limla A. Riley
`How to Generate and Evaluate Ideas in Tourism:
`A Guide to Brainstorming 86:!
`
`Iolan L Cromptcm
`The Nominal Group Technique for Generating
`and Evaluating Ideas
`870
`Carson 13. Wait
`,
`
`The Psychology of Tourism 873
`Philip L. Pearce
`The Tourism Promotional Mix
`John Bowen
`
`334
`
`Advertising in Tourism and Travel:
`Tourism Brochures
`893
`Graham M. 5. Dana
`
`32
`
`33‘
`
`34-
`
`35
`
`36
`
`37
`
`33
`
`39
`
`40
`
`Psychographic Segmentation 902
`Russell E. Brayley
`Linkages Between Agriculture and Tourism 910
`Morton Fox and Linda J. Cox
`
`948
`
`Development of Seaside Resorts
`Charles A. Stansfielcl, Jr.
`The Evolution of the Ski Industry 926
`Peter Williams
`Theme Parks and Attractions
`
`934
`
`Ady Milman
`Festivals and Special Events
`Donald Getz
`
`945
`
`State Welcome Centers: An Important Part
`of the Visitor Information System 956
`
`Daniel R. Fesenmaier, Clnristine A. Vogt,
`and William P Stewart
`
`Global Information Technologies in the Airlines
`Tourism Business
`954
`
`Monika Eclatermeyer
`Sources of Information 974
`Cloarles R. Goeldner
`
`Author Index 985
`
`Subject Index 992
`
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`
`Reservation Systems
`
`Paul R. Gamble
`
`The reservation system is the engine of a lodging property because in a sense
`it powers everything else along. If the reservation system is not working well
`then the hotel or motel will lose business or may even go out of business.
`Many hospitality companies are beginning to realize that their competitive
`survival may well depend on having a reservation system at least as good as
`their rivals.
`'
`
`The Tasks of a Reservation System
`
`The problems that face the reservations manager in a busy hotel can be illus-
`trated by reviewing the tasks that the reservation system must perform. The
`whole process of taking bookings, receiving guests, providing for their stay
`and billing them on departure is known as the guest cycle. The reservation
`system is therefore the start of the guest cycle, as indicated in Figure 1.
`
`A guest inquiry may arise from the hotel’s sales department; directly from
`the guest by mail, telephone, facsimile, or telex; or from a sales agent such as
`a travel agent or airline reservation system. The inquiry may relate to one
`room or to many and to an arrival that may be tomorrow or a year away. The
`reservation system must help the clerk collect data in an efficient and orderly
`fashion. It is therefore important that the system operate rapidly and be easy
`to learn and use. Once the basic data are recorded, the system must then
`help the clerk decide whether the hotel is able to accommodate the sale.
`The available rooms and the price, or room rate, at which they might be sold
`must be displayed in a style that can be grasped at a glance. In this initial
`contact with the hotel, it is vital to give a good impression of sales efficiency.
`The reservation system should link directly with the hotel's guest his-
`tory file. This file is a record of previous guests, their organizational affilia-
`tions, and details of their hotel use. The ability to draw on previous data
`quickly can have a very positive impact. For individual guests it may appear
`to enhance personal service and for sales agents it saves time. However,
`
`Receive inquiry and Check Avaiiability
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`RESERVATION
`REQUESTS
`
`other
`Travel Industry
`Hosts
`
`
`Central
`_
`Contacts
`Reservation
`Direct
`
`f’°"‘
`system
`G“e5t
`Sales AE:':t:-/ (Corporate)
`
`
`
`
`
`Lists
`
`1
`
`Room Aliocation
`
`
` Registration
`
`
`Operation :5!
`P roceclures
`
`'
`
`Room
`
`Availability
`
`
`
`RESERVATION
`SYSTEM
`
`Forecasts
`
`Forecasting
`System
`
`Reservation
`Policies
`
`
`
`Production
`Scheduling
`
`
`
`Labor
`Scheduling
`
`l
`FlE CEPTION
`SYSTEM
`
`A hotel that accepted every reservation inquiry it received would not be able
`to maximize its potential profitability. Deciding whether to accept or refuse
`a reservation is the most critical decision the reservation clerk makes, and it
`is not at all easy. The following factors should be taken into account:
`
`Guest Status. A VIP, a frequent visitor, or the owner of a travel agency may
`be more important than a casual guest who is passing through the area,
`perhaps for one visit only.
`
`Credit Status. There is not much point in selling rooms to people who do not
`pay their bills. The reservation system must be connected on—line to the city
`ledger, which keeps track of all revenues and credit charges. If the reservation
`system is on—line, the credit status records can be kept up to date all the
`time.
`
`Occupancy Fluctuations. Unfortunately, hotel guests are not as reliable as hotels
`would like them to be. People have a habit of changing their plans. This
`causes short-term fluctuations in occupancy that must be predicted if the
`hotel is to maximize revenue. Factors that increase occupancy (the number of
`rooms sold) are wall-:—ins (sometimes called chance arrivals because the guest
`arrives with no prior reservation) and stay—ons, guests who extend their stay
`beyond their scheduled departure date.
`These factors are offset by factors that decrease occupancy. Cancella-
`tions are relatively easy to manage since the hotel is given notice of the
`nonarrival but a no-show describes a guest who simply fails to turn up. This
`is not unusual for business executives whose travel plans often change. Extra
`departures are guests who leave before their planned departure date.
`
`Simplified diagram of a
`reservation system.
`
`Make the Accept/Refuse Decision
`
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`elers tend to be fairly predictable whereas business travelers and convention
`delegates are less so.
`
`Conversion Hatfo. Particularly when large group bookings are concerned, the
`number of rooms that may actually result from an inquiry can be hard to
`judge. When negotiating for a rate, potential customers exaggerate the size
`of their group in order to get a lower rate. There is often a big difference
`between the number of provisional rooms sold and confirmed bookings.
`There may also be a reduction between the confirmed booking and the
`actual arrival. This ratio between the provisional booking and the arrival is
`known as the conversion ratio and it varies between types of customer.
`
`Pressure of Business. The amount of business varies between day of week,
`month of year, and year to year. lf the demand for rooms is stronger this
`year than last, the reservation manager would be well advised not to sell
`blocks of rooms to groups or conventions at a low rate well in advance. These
`early inquiries should be refused in the expectation of getting a better rate
`later on.
`
`Effector: the Room Rate. Reservations will give the hotel a forecast of business,
`which is important to its cash flow. Since most of a hotel's revenue and most
`. of its profit derives from room sales, it is important for the reservation system
`to manage the average rate, that is, the average price of all the rooms sold
`on a particular day. Some reservation systems, especially older systems, draw
`the manager's attention especially to occupancy, the volume of rooms sold.
`This can have the effect of increasing volume at the expense of rate since
`there is a temptation to sell rooms at a discount. Total revenue may actually
`fall with this approach.
`lf twin
`A special aspect of this problem is muitiple room occupancy.
`rooms are sold too soon to individual guests, often at a lower rate, then
`potential spinoff business is lost in restaurants and bars because the number
`of people in the hotel is reduced.
`
`Policy. The business plan also describes the long—term strategy of the hotel
`or the way in which the management team wishes to position the hotel in the
`market. Perhaps business from one source, although strong today, is expected
`to decline in the future. A sales effort to develop another market segment
`might be started and inquiries from this new segment would then receive
`higher priority.
`Given all these issues, a hotel with say, 100 rooms, needs a reservation
`system that does more than simply count up to 100. Sometimes the hotel
`will sell 110 or perhaps even 120 rooms, overbooking in the expectation of
`no-shows or fall off from a provisional inquiry. Managing the level of over-
`booking is a difficult problem for a hotel. At other times the reservation
`manager will need to block rooms, which removes certain rooms from sale.
`Suppose a major trade show is held in the first week of September. Rooms
`may be blocked for release in say, August, when they can be sold for a high
`price. ln addition, the hotel may have agreements with sales agents who are
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`.I5:.2,_..',,;.-.-,-of-__a;"_".,'.;W.:'."_3~.-_'_~t:..::«.
`
`Process the Sale
`
`Once the reservation is accepted, it may need to be acknowledged. It may
`also be necessary to obtain advance deposits or Credit card details. Good com-
`munications with the outside world and a facility with foreign languages are
`important in reservations. Sometimes, the reservation system may need to
`allocate a specific room for a guest when the booking is accepted, especially
`in small, resort hotels. More often, the actual room to be occupied is allo-
`cated on the morning of the day of arrival. The reservation system must
`closely support the receptionists who do this job by providing data in a con-
`venient format. The arrivals list produced by the reservations system is of
`special interest to other operating departments in the hotel.
`
`Links with Other Departments in the Hotel
`
`The reservation system must have close contact with other hotel operating
`departments. lt must collect instructions from the marketing and sales depart—
`ment about plans and targets and collect credit information from the account-
`ing system. ln turn it must provide information about future expected sales.
`Operationally, it must stay in touch with reception, housekeeping, the front
`hall staff, and even the banqueting and convention department. The reserva-
`tion system must be fully informed about the operating plans and policies of
`the hotel. The annual maintenance schedule for redecorating blocks of
`rooms will be fixed in agreement with reservations. On a day-to—day basis,
`the reservation system must have direct access to the hotel's room status
`system. Not all hotel guests arrive and depart with plenty of advance notice.
`The reservation system also must cope with the daily fltfctuations of un~
`planned arrivals and departures.
`
`Manual Systems
`
`Property Management Systems (PMSl
`
`Types of Reservation System
`
`Very small hotels may simply use a bookings diary. However, the most com—
`mon manual system for hotels of any size is known as the Whitney System.
`This system was devised by the Whitney Paper Corporation of New York in
`the 19405 and it has been widely adopted worldwide. Each reservation is
`recorded on a small, multipart piece of paper mounted in a metal frame
`which, in turn,
`is filed in date and alphabetical order on a metal rack. The
`slips are usually color coded to denote the type of guest. Usually there is one
`rack for every day over say, the next three months, and fewer racks for
`future periods. Copies of the slips, also on racks, may be sent to other depart-
`ments such as reception or telephones when the guest arrives. This system
`gave rise to the expression "rack rate," which is how hoteliers often refer to
`the price for rooms.
`
`Whitney systems work very well but they do generate lots of paper. Clearly,
`organizing huge volumes of data is an ideal job for a computer. Unfortu-
`nately, in 1963 a large computer system to computerize the entire front office
`of the New York Hilton went disastrously wrong amid great publicity, dis—
`couraging both the hotel industry and the computer industry for some time.
`During the late 1960s and 19705 hotel companies installed reservation sys-
`tems based on minicomputers. At this time well-known systems such as Holi-
`dex of Holiday Inns were started. So large and powerful was the computer
`system needed to run Holidex l in its day that it was designated as part of the
`
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`lt was therefore not until the 19809 and the commercial success of the
`
`microcomputer that computerized reservation systems became common-
`place in hotels as part of a property management system. Surveys conducted
`regularly for the American Hotel and Motel Association indicate that be-
`tween 198O and 1987, the number of microcomputer PMS installed in the
`United States grew from zero to 30,000 (Chervenak 1988).
`In the 19905, the power and performance of microcomputers is such
`that even hotel properties with very few rooms can use them cost effec-
`tively. Worldwide, nearly 200 different companies are offering PMS to the
`hotei industry. Essentially, a computerized reservation system undertakes
`the same sort of tasks as a Whitney System but the performance of the com-
`puter is exploited to organize data more efficiently (Kasavana and Cahill 1987).
`Computers also provide for some augmentation of the product to en-
`hance guest services. Preregistration is made easier by the computer, which
`means that all the guest has to do is sign a registration form on arrival. Indeed,
`available systems now allow registration from remote locations such as air-
`ports, using hand—held microwave transmitters. Self check—in is also available
`to guests so that they can avoid long lines at the reception desk. On depar-
`ture, the system also provides for self checkout and this interfaces with the
`billing system.
`
`Large hotel companies cannot maximize their profit potential, or even exploit
`the marketing advantages of sheer size, by managing their hotel chains on
`a piecemeal basis. A centralized reservation system allows a company to man—
`age demand strategically, for entire regions or for large cities. This simplifies '
`some aspects of the rooms inventory management problem when large groups
`or conventions can be switched between hotels. At the same time, customer
`convenience is improved. A single 800 number, which contacts a central
`point, enables a potential guest to make a convenient reservation at any
`property around the world. Almost all the major hotel groups now operate
`their own CR3. The competitive advantage of this service has even encour-
`aged some cooperation between companies too small to warrant a CRS of
`their own.
`
`The technology used to support these systems is quite sophisticated.
`Fast networks, fiber-optic cables, and satellite transmission are often used to
`transmit data between the CR5 and the individual hotel. At the same time,
`even more service can be added for customer gain, including low-cost facsimile
`transmission and teleconferencing.
`
`The impetus for much of the development initiatives in hotel CRS has come
`from the airline industry. Powerful reservation systems such as SABRE owned
`by American Airlines, Apollo owned by United Airlines and System One
`owned by Texas Air have been particularly influential. Airline CR8 do not
`confine their activities to selling airplane seats and their success in capturing
`more of the travel market by selling hotel rooms, renting cars, booking thea-
`ter tickets, and even complete holidays has encouraged hotel companies to
`respond directly.
`
`Techniques for Managing Reservations
`
`Centralized Reservation Systems lCRSi
`
`Links with Other Travel industry
`Reservation Services
`
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`
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`Yield Management Systems
`
`ten days to several months or even longer; very large conventions may wish
`to book hotel space two or more years ahead. From the reservations man-
`ager's point of view a four-month period probably covers the period over
`which critical decisions about hotel capacity have to be made. The short-
`term period includes the next five to ten days. The number of days between
`the reservation and the arrival is known as the booking lead time. In a commercial
`or business hotel the average booking lead time might be quite short, perhaps
`only a few days. lt is not unusual for over half the hotel's entire business to
`be booked less than five days before arrival.
`Reservation departments therefore produce regular forecasts for other
`departments of the hotel. Typically, these might include daily forecasts for the
`next ten days, weekly forecasts for up to two months out and two further
`monthly forecasts. These are extremely important. Most of the other hotel
`departments look at the forecasts closely and plan their labor scheduling,
`food production levels, and promotional activities based on the amount of
`business predicted by the reservations department.
`
`Forecasting in any business can be difficult but is especially so in a service
`business like the lodging industry. Many factors have to be taken into ac-
`count and many possible responses are available to the hotel or motel in
`marketing and sales terms.
`'
`Yield management systems are being incorporated into hotel reservation
`systems to try to help with these problems. The technique is actually the
`outcome of three marketing decisions. These are the strategic decisions as to
`which product to offer and in what quantity overall, the tactical decision to
`determine the configuration of the product on a particular day and, finally,
`the pricing decision to support that tactic. lf it were to be relabeled more
`precisely yield management would probably be termed a pricing system (Reli-
`han 1989). A yield management system actually seeks to maximize revenue,
`not yield.
`The approach proceeds from known conditions to unknown conditions.
`Known conditions include the number of rooms available, demand as it is
`experienced by the hotel, and the range of prices that may be quoted. Un-
`known conditions include total demand in that market, the effect of short-
`term fluctuations such as cancellations and no—shows, the demand build up
`
`pattern in the current sales period, and competitor activity.
`All of these elements are present in the decision process whether a hotel
`uses a yield management system or not. However,,a yield management system
`tends to formalize both the data and the decision process with a view to
`increasing revenue by better price and marketing mix management. This
`increased revenue is achieved by more frequently adjusting the availability
`and price of rooms for different markets. It also aims to make the best of .
`multiple night stays and reduce unnecessary discounting by prematurely re-
`leasing capacity.
`,
`Yield management systems are closely linked to the PMS from which
`they obtain data. However, they also need to obtain data to account for
`market conditions in the city or region. They then use a combination of
`statistical forecasts and rule-based procedures to identify the reservation status
`of the hotel. The statistical forecast uses conventional techniques for deter-
`mining the trend of business and the way in which that will be affected by
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`Starbucks, Ex. 1067
`Starbucks v. Ameranth, CBM2015-00091
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`based on rules that have been programmed into it, in order to recommend
`appropriate actions.
`It is expected that yield management systems will become as important
`and regular a feature of hotel reservation systems in the 19905 as they are in
`present clay airline reservation systems.
`
`Summary
`
`An efficient reservation system is crucial if a lodging property is to meet its
`profit targets. However, the business of managing demand through the reser-
`vation system is complex. Many factors have to be taken into account and
`good operating systems are needed to track movements in the market. The
`basic procedures for receiving and recording bookings have not altered, but
`in today's business environment manual record systems can be too slow. and
`expensive. Computerized systems help organize the vast volumes of data and
`allow for rapid, efficient communications with guests and with other hotei
`departments.
`K
`However, many of the problems with which a reservation manager has
`to struggle still depend on human judgment. Deciding whether to accept a
`booking right now or to refuse because there is an expectation of better busi-
`ness, or because the hotel is trying to cultivate a new market, is not easy.
`The procedures built into yield management systems are designed to help
`with parts of this problem.
`The key concern for a hotel or chain of hotels is the reservation policy.
`Clearly policy is central to how the system is meant to work. If the manage-
`ment team decides that it will never walk (turn away from the hotel) a guest
`with a confirmed reservation, then overbooking must be managed very cau-
`tiously. If it decides to give priority to a travel agent in the high season be-
`cause of promised business for the_ low season, then it must expect to refuse
`reservation inquiries at high room rates in some periods of the year.
`As a result of these issues, the reservation system needs careful manage-
`ment attention. Both reservation policies and practice must be evaluated at
`regular intervals to ensure that the system is responding to the changing busi-
`ness environment of the hotel and allowing it to maximize profitability.
`
`References
`
`Chervenak, L. 1988. Hotel information processing I988, CKC Report 5(1):3.
`Kasavana, M. L, and _l. Cahill. 1987. Managing Computers in the Hospitality Industry. East
`Lansing, Mich.: The Educational Institute of the AHMA.
`Relihan, W. J. 1989. The yield management approach to hotel—room pricing, Cornell
`Hotel Restaurant Administration Quarterly, 30(1):40—4-4.
`
`Starbucks, Ex. 1067
`Starbucks v. Ameranth, CBM2015-00091
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`

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