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Rationalisation in the Hotel Industry

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With the economy being in a double dip recession (and it the deepest and longest recession for generations) there is a major lack of demand for goods and services in the economy. Vice Chancellor, George Osbourne delivered the Autumn Statement 2012 yesterday (Wednesday the 5th December) and stated to expect slower growth [1]. Taking these factors into account, the future for Junction Hotel isn’t looking bright. Junction Hotel’s current economic situation has unsettled Chance. He feels that Meg Mortimer’s (General Manager) social approach to managing needs to be addressed as it’s inefficient and unorganized.

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An alternative type of management could be ‘Rational Organisation’. Rational Organisation would be ideal for the hotel because it would change and improve the areas of the hotel where it’s underperforming. Rational Organisation recognises that the largest cost to a business is Labour e. g. wages. Therefore it emphasises on Cutting Costs. Rational Organisation does this by fragmentation of production. It also focuses on increasing control, efficiency and has a very formal style.

Bureaucracy also plays a large role in this type of organisation [2].

These collectively would improve the efficiency within Junction Hotel’s management as there is a recognizable level of hierarchy and accountability. Rational Organisation was used by many organisations in the 1900’s. The most documented people for using these types of methods would be Taylor, Ford, Webber and Fayol. This type of organisation has also been known as ‘Taylorism’ or ‘Fordism’. Fordism is the name given to Henri Ford’s principles of production. It concentrates effort towards seeking higher levels of output through using conveyor assembly lines and making that the work is broken down into smaller and less complex tasks [3].

In summary Fordism was all about efficiency and focusing on minimalizing the workers tasks. Taylorism, similar to Fordism, focuses on maximising productive efficiency. But unlike Fordism, it focuses heavily on profit maximisation and using scientific methods to maximise efficiency [4]. Taylor focused on coming up with new working methods to make workers more efficient and therefore allow them to do their job better. Rather than heavily focusing on breaking down the tasks, he focused on how he could make workers jobs easier.

So how could Rational Organisation be beneficial to Junction Hotel bearing in mind the current economic climate? A level of Bureaucracy would be implemented. It would clear things up in terms of who is in charge of particular areas. A single person would be put in charge of the restaurant. This is beneficial as the waiters/waitresses would know exactly who they’re accountable to. It would also increase the efficiency of the restaurant as it would become more organised and therefore the restaurant could deliver a better quality and faster service to customers.

Additionally, the tasks for the hotel would be broken down so they are less-complex, easier and faster. The hotel can recruit with little effort as the training time would be reduced. In turn, the hotel would save money on worker training as it’s shorter and less expensive to train workers. Rational Organisation would also be able to improve the control because it would introduce a set of rules and regulations to the hotel. As a result this would increase output per worker and therefore the entire output for the hotel.

Charles Broadhead Marketing Design and Communications Foundations of Marketing and Organisation Rationalisation is still a form of management that is used all over the world today. It can be applied to many industry’s one of which being the fast food industry. Out of all the fast food restaurants, there is one which stands out above the rest and this is McDonalds. Some marketers have even said that McDonalds have used rational organisation so well that they have referred as it to ‘McDonaldization’ [5]. McDonalds have broken down the production of the standard hand burger into minimal tasks.

For example the salad would be added to the bun by one person. Another colleague would add the sauce and another would add the cheese and burger. Once this is done another worker would box the burger up and slide it down a tube ready to be eaten by the customer. Even the customer service that is delivered by McDonalds is broken down into tasks. The restaurants have tills which allow the worker to quickly enter a customer meal by a touch of an icon on a touchscreen till. Rationalisation has worked very well for many large organisations in the past.

Firms have reaped the benefits of higher efficiency, more control and cutting costs. However it hasn’t always been beneficial for every type of organisation. Rational Organisation has had undesirable effects on the people working for the organisation. The tight, ‘claustrophobic’ like conditions have led to poor health for workers. The repetitive and dehumanising tasks have been claimed to leading to inefficiency in workers. The tedious form of work made workers feel under-used and that their skills are wasted.

This type of work has also led to problems with workers mental health. What is meant by this is that workers would often find games or patterns in their work to help them complete the tasks quicker. With this in mind, Junction Hotel’s service is very social and the straightforward, blunt methods of Rational Organisation may alter the type of service offered. We’ve discussed how rational organisation works, its advantages and disadvantages, but is it necessarily the most desirable strategy for managing and organising Junction Hotel?

Some would argue that junction hotel lacks structure and clear management. The case study even states that the organisation doesn’t even have an organisational chart. For these reasons it would be worthy to bring in rational organisation. It would bring in a level of bureaucracy, which is what junction hotel doesn’t currently have. Rational organisation would also help cut costs and increase efficiency. Not only would the hotel save money they would be making more money at the same time, making it a more stable and profitable business.

On the other hand however, there are some disadvantages Chance will have to take into account about rational organisation, such as the health of the workers and the hours each worker should be entitled to if they are going to be performing such repetitive and dehumanising tasks. In the past it has been argued (Zaltman and Duncan, 1977) that there can be difficulty changing a team and their habits. There would be resistance to change. Some factors to consider would be team solidarity, conflict, rejecters to outsiders and more. [6] References: [1] http://www. bbc. co. k/news/business-20550112 [2] Ian Brooks “Organisation Behaviour: Individual’s, Groups and Organisation” (4th edition) – Pg193. [3] http://www. businessdictionary. com/definition/Fordism. html [4] Ian Brooks “Organisation Behaviour: Individual’s, Groups and Organisation” (4th edition) Pg158. [5] Ritzer, G, (2008) “Efficiency: Drive-Throughs and Finger Foods” from Ritzer, G, The McDonaldization of Society pp. 57-78, [6] David Coughlan, “Leadership & Organization Development Journal, Vol. 15 No. 2, 1994 : Organizational Change through teams and groups. ” Pg. 18-23

Cite this Rationalisation in the Hotel Industry

Rationalisation in the Hotel Industry. (2016, Oct 25). Retrieved from https://graduateway.com/rationalisation-in-the-hotel-industry/

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