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Vol. 39 (Nº31) Year 2018. Page 24

Current issues in hotel management in Russia

Problemas actuales en la gestión hotelera en Rusia

Natalya Y. VELICHKO 1; Alla V. PETROPAVLOVSKAYA 2; Boris M. ZHUKOV 3; Oleg A. RAZZHIVIN 4; Lyudmila M. OSADCHUK 5

Received: 18/03/2018 • Approved: 29/04/2018


Contents

1. Introduction

2. Literature review

3. Materials and methods

4. Discussion

5. Conclusions

Bibliographic references


ABSTRACT:

The tourist industry was born in Europe, which today is one of the most visited regions. The socio-economic conditions of development of the countries of Europe much better than in countries in other regions. Currently, other tourism regions are also developing quite actively and show high rates of increase of tourist flow. The relevance of this work lies in the need of search for better management solutions, improvement of management in the service sector. Keywords: hospitality, management, services, resource management.
Keywords: hospitality, management, services, resource management

RESUMEN:

La industria del turismo nació en Europa, hoy es una de las regiones más visitadas. Las condiciones socioeconómicas del desarrollo de los países de Europa son mucho mejores que en los países de otras regiones. Actualmente, otras regiones turísticas también se están desarrollando activamente y muestran altas tasas de aumento del flujo turístico. La relevancia de este trabajo radica en la necesidad de buscar mejores soluciones gerenciales en el sector de servicios.
Palabras clave: hospitalidad, gestión, servicios, gestión de recursos

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1. Introduction

The total volume of the hotel market in Russia is estimated in 1.7-2 billion US dollars, the growth rate is estimated at 10 to 25% per year, the number of hotels, beginning in 2007 was 4.5 million, total number of rooms employs 410 people. Mid-annual loading of hotels in the regions today is 50-60% occupancy of hotels in Moscow is, according to various estimates, 70-80%. The development of hotel services market in Russia in the 90-ies of the last century and the beginning of the new Millennium was characterized by several multidirectional trends. Long-term investments in hotel property is a necessary condition for the formation of a full market for a long time was unattractive to investors. The hotel services were largely retained the imprint of the Soviet past. Foreign operators until the early 2000-ies did not venture to act outside of Moscow and St. Petersburg. Regional cities were a typical situation where the major hotels remained in state ownership.

Thus, in the absence of any serious competition, the hotel continued to “feed” the local administration that cared little about the quality of services provided, the positioning of the hotel and other market criteria. In most regional hotels remained the traditional Soviet approach to the management, the quality has decreased.

In many regions there continues to be a disproportion of the segments of the market, namely the share of small hotels in the middle, according to the world standards level. It is in this sector makes the most sense to develop new brands, to invest in the creation of hotel chains. The reduction of the gap between demand and supply in the coming years will determine the dynamics of the market. Overcoming the deficit should be a signal of the output market to a new stage of development. In the short term the excess demand, the market will respond with higher prices. This is especially true of Moscow, where high prices deter tourists. Many of them are forced to make suboptimal choices for themselves and to stay in more expensive hotels, because of the lack of sufficient number of rooms in three-star, according to the world classification hotels. In the future four-stars and five-stars hotels can experience the churn of these customers-tourists (Medlik & Ingram, 2017).

2. Literature review

It should be noted that the hotel business is an infrastructural component of the modern tourism market, the role, significance and the scope of services which is continuously increasing the General socio-economic development of any country, including Russia.

The role will play a hotel business in the Russian economy is likely to become increasingly important, contributing to improving the quality of life. Unlike other areas of the service sector of the economy, mainly oriented to the satisfaction of utilitarian needs, the hotel business performs an important socio-economic point of view the function as one of the fundamental elements of the infrastructure of the tourist market, it generally determines its development, given that the tourist market of Russia has virtually unlimited growth potential.

The theme of hospitality is dedicated to a sufficiently large number of publications, both foreign and domestic authors. Among the most important publications should be mentioned the works of foreign authors: B. Marvin, C. Egerton-Thomas, Philip Kotler, the development of the Association of schools of hotel business and catering industry in Europe (EURHODEP), and the works of Russian authors A.D. Chudnovsky, A.S. Zapesotsky, Y.F. Volkov, N.I. Kabushkin, V.S. Yankevich, S.S. Skobkin, L.P. Voronkova, etc., on certain problems of the hotel business: the history of hospitality, marketing policy, strategic and economic aspects; contributed editorial articles of domestic and foreign authors devoted to particular aspects of the development and management of hotel business. In the part of the scientific basis of quality management in the hotel industry are considered in the works of the following authors: L.V. Baumgarten, L.E. Basovsky, A.A. Gvozdenko, A.B. Gochev, V.A. Lapidus, A.V. Litvinova.

3. Materials and methods

The subject of research is economic-management relations in the enterprises of hotel business in the process of improving the system of management of their activities.

Object of research are the enterprises of hotel business, including those organized in the form of hotel chains, as an important segment of the Russian market of tourist services.

The theoretical and methodological basis of the research was a systematic approach to the analysis of socio-economic processes and phenomena. The authors widely used the domestic and foreign scholars on the problems of management in socio-economic systems, the most significant works of an applied nature experts in the field of hotel business, as well as numerous empirical nature, including those obtained directly in the course of the study.

Scientific novelty of research consists in development of recommendations for effective management of the enterprises of hotel business.

4. Discussion

4.1. Modern features of hotel services market in Russia

In all segments of the Russian market is developing the hotel chain. Hotels – “loners” are slowly disappearing (with the exception of the segment of mini-hotels).

Consumers increasingly make choices based on brand. The more famous the brand, the more successful the hotel is. More and more Russians prefer foreign representatives, as the quality and standards are much different from Russian. This becomes a big problem for the Russian tourism (Lockwood & Medlik, 2001).

It can be noted that the historical preconditions of the hotel business in Russia was favorable in pre-revolutionary time. Hotels of major cities such as Moscow and Saint Petersburg had a competitive advantage even in comparison with many Western hotel companies (Barchukov, 2015).

Today, there is positive dynamics in development of hotel business in big cities but in small towns there are a large number of hotels have not been updated with the inventory, the insufficient range of services and quality of service (Litvak, 2016).

4.2. Tourism industry as an interrelated system of businesses

The tourism industry is an interrelated system of businesses, entrepreneurs, providing travelers with everything they need for consumption during the trip and sufficient for the implementation of the actual process of travel tourism services, works and goods. The tourism industry is a set of business processes, United by a common goal – providing the necessary or desired product or services to a tourist for his own specific needs. Since 1992, the tourism industry has gained importance, putting it on a par with the world's largest areas of business activity. It is busy every ten-able-bodied inhabitant of the planet. It includes everything that connects the traveler with the business processes, the state and the people directly involved in the organization of travel. Only in USA more than 16,000 airports and 47000 hotels cater to tourists. The number of jobs created tourism is second only to healthcare.

Based on these assumptions, the tourist industry is a set of hotels and other accommodation facilities, transport facilities, objects of public catering, objects and means of entertainment, objects of cognitive, medical and health, sports, religious, cultural, business and other purposes, organizations, tour operator and travel Agency activities, as well as organizations providing tourist and excursion services and services of guides-interpreters. This definition is given in article 1 of the Federal law “About bases of tourist activity in the Russian Federation”.

According to the international standards of the tourism package at a minimum must contain two services: transportation and overnight. All others complete the tour, provide the content, contribute to the achievement of the main goal and generate tourist experience.

4.3. Accommodation facilities in tourism

Accommodation is the most important element of tourism. No accommodation (overnight) – there is no tourism. This is an inherent and stringent requirement of the economy of any tourism area or center, hungry for hard and big profits from tourists and the exploitation of their tourism resources. The hotel industry is the basis of the system of hospitality. Accommodation facilities in tourism are the resources used by tourism organizations to provide hospitality and providing accommodation services during the trip (Figure 1).

Figure 1
Accommodation facilities tourists and travelers

Source: Prepared by the authors.

 

Accommodation enterprises can be classified on several grounds. One of the signs involves the division of all the accommodation into two main types:

By location it is possible to allocate following categories of hotels:

The existing national system of classification of accommodation facilities adopted in different countries, supported by a state or national hotel associations by national standards and institutionalized rules of certification of hotel services relate mainly to the quantitative characteristics of the material base, completeness of service, the level and quality of hotel services and do not affect features such as target markets, specific functional requirements, ownership and governance structure, principles of location of accommodation etc.

However, other diverse signs qualifying accommodation facilities are used in both national and international statistics for the hospitality industry. The world tourism organization, analyzing national statistics and publishes statistical aggregates recommends their qualification scheme, you need to know when analyzing and mapping statistical data. Standard classification of tourism accommodation, developed by experts of the WTO, also adopted in international practice are presented in Table 1.

Table 1
Classification of accommodation facilities recommended by WTO.

Category

Class

Group

Collective means of accommodation of tourists

Hotels and similar accommodation facilities

Hotels

Similar establishments

Specialized institutions

Health institutions

Camp of work and rest

Public means of transport (train, sea and river vessels, etc.)

Congress centres

Other collective institutions

The home, designed for relaxation

Campsites

Other

Individual accommodation facilities

Individual accommodation facilities

Own home

Rented rooms

Rented dwellings

Accommodation from relatives and friends (free)

Other

Source: Prepared by the authors.

In addition to classification of accommodation facilities recommended by the WTO, there are further classification system of accommodation facilities adopted in different countries.

Classification by size (the capacity of number Fund) is also important. The size of the hotel, or the number of rooms, is the most common formal method of classification of hotels (Reznichenko et al., 2016). Accommodation capacity is determined by the number of rooms or locations. Statistics are often quoted both. Usually depending on the size (number of rooms) there are four groups of hotels:

These categories enable hotels of similar size to compare the results of economic activities for statistical reporting. If you do not specify any other specific characteristics, the hotels in the following types of classifications can be of any size. In addition, the size of the hotel shows usually on the completeness and quality of service (quantity and quality of additional services), and indirectly of other parameters.

4.4. Factors of development of the hospitality industry

The hospitality industry is developing under the influence of a number of factors that can be divided into two groups – external and internal (Table 2). 

Table 2
Factors of development of hotel industry.

Factor

External

Internal

Influenced by components of reality, not connected with the operation of the hospitality industry

Directly connected with the peculiarities of organization and functioning of the hospitality industry

Source: Prepared by the authors.

There are a number of factors influencing the development of the hospitality industry. These include: polite-legal factor, safety factor of travel, economic and financial factors, socio-demographic factors, cultural factors, infrastructure factor of communication, technological, logistical factors, etc.

For the development of the hospitality industry, the greatest value of play age, family and social composition of the population. Differences in the age composition of travelling led to the emergence of specialized accommodation for young people of middle and old age. The social status of tourists leads to the appearance of hotels in various price categories, focused on people of different incomes. An important factor is the composition of the family travelling that led to the emergence of hotels for families with children, a flexible system of discounts for tourists traveling families, etc. (Gronroos, 2011)

Improvement of the hotel product. The hotel product is the most important element of the tourism product. In this regard, much attention is paid to quality and the further upgrading of the hotel product. The quality of the hotel product is largely dependent on the state of the environment and infrastructure. In this respect, the role of tourist organizations, regional tourist administrations, government agencies, professional associations that can join forces to create an atmosphere of hospitality, to attract the necessary investments (Barchukov, 2016; Mamycheva et al., 2017).

Creation of hotel chains and associations. In the last decades due to the emergence and development of information technologies and communications, the largest hotel company began to join together in a hotel chain with the purpose of regulating the business development and growth and the more equitable distribution of income. Famous hotel chain Marriott, Sheraton, Holiday Inn, Accor and many others guarantee the quality of provided tourist services. Widespread and lodging Association. The most influential organization is the international hotel Association (IHA) (Sizykh, 2007).

The development of distribution systems. Such systems reduce to a single chain of suppliers, sellers and buyers of hotel products. New information technologies have greatly simplified the system of distribution of hotel services, to make it more informative and effective for all participants. A modern distribution system can be easily adapted to the needs of buyers, providing them with a variety of accommodation options and additional services.

The labor factors. The development of the hospitality industry contributes to employment in both developed and developing countries (Feoktistov, 2017). It is noteworthy that the developed countries and the most famous tourist destination (Turkey, UAE, Egypt), experiencing shortages in the workforce, actively import labour from other countries. So, in the hotels of Turkey and Egypt you can meet the animators from Russia, Ukraine and Italy, the guides from Poland and Belarus, translators from Germany, Slovakia and Kazakhstan.

Marketing. Well-developed marketing strategy of the hotel – the key to his success in business development and winning in competition. In the center of the marketing of any business of hospitality should be the consumer of hotel services – tourist (Gronroos, 2011).

Seasonality is a special place and has a significant impact on the functioning and development of the hotel enterprise. The high tourist seasons are considered as summer (for most of the tourist destinations in the world) and new year holidays. February and October, the majority of travel companies are considered “dead season” (low), as the number of tourists purchasing tours decreases significantly and approaches zero. For hospitality businesses the most important challenge is to overcome the seasonality factor, as in negative and positive form. There is nothing worse for a Manager service reception than be forced to refuse the potential clients in the booking of rooms due to the lack of available rooms. High season during which the average number of arrivals exceeds the average monthly number for the year. Therefore, for stable operation of any hotel enterprise, it is preferable to ensure uniform load, preventing the decrease in the level of hotel occupancy is below 50% (Sorokina, 2010).

To the adverse effects of seasonality can be attributed to the fact that for a certain period of time the bulk of the hotel remains unclaimed. To attract tourists’ accommodation enterprises are forced to pursue a flexible pricing policy, or to develop new services.

All these factors are interrelated, and to achieve popularity in the market, they should match. To do this, conduct market research and based on their results.

5. Conclusions

Factors that increase the efficiency and occupancy of the hotel enterprise. Special marketing programmes of hotels and the introduction of new technologies today have become an integral part of their corporate policy and the key to a successful business.

The hotel management with the knowledge and skills of management, as a rule, always strives to find and offer customers new services. A permanent change in nomenclature of services is one of the most important elements of the target strategy of the hotel, aimed at formation of competitive advantages.

Leading technologies can change the balance of forces in industry competition. The leading technology in the implementation phase is usually a property, know-how single-player on the market. A good leading technology capable of producing a revolution in the market and bring in the leaders of its owner, even if he wasn't informed. Therefore, the hotels-it is important for leaders not to miss the emergence of new market leading technologies.

The increased performance is achieved by optimizing the use of resources of the hotel, save the cost of data processing, and more effective implementation of the main production operations.

5.1. Creation of integrated hospitality information network

The creation of an integrated hotel information network, the center of which is a modern management system allows to minimize the need for duplication of information and thus avoid errors that occur when manually entering data. Labor saving even one worker a day will allow you to save a substantial amount of money, not to mention avoiding costly mistakes.

Capabilities of the systems on the organization of the maids refuse to allow floor-by-floor services, and more properly plan the loading staff.

But the greatest impact can be expected from the increase in the correctness of the management decision-making, which is achieved by optimizing the information used in management process (Mindlin, Kolpak & Gasratova, 2016). Thus, the system epitome PMS contains numerous management reports that represent the data processed for decision-making. With reports received by the hotel Manager can more accurately determine the positioning of the hotel, the dynamics of the demand and particularly the preferences of the guests, to identify the most important customers and prepare proposals.

First of all, you need to ensure that the hotel is all possible sales channels. Modern technologies allow to open the hotel for booking through its own website and a lot of both Russian and international travel websites, global reservation system, a private call center (hotel companies) and call centers tour operators.

It must be remembered that the best booking comes from individual clients. For the capital's hotels, important role in attracting this category of guests play an international Agency, working in the global reservation system GDS, and not having direct contracts with hotels. Therefore, to work with such agencies, them in the world a few hundred thousand, it is necessary to establish a process of calculation and payment of commissions (7-12 % of the cost of the reserved services). Control system automatize this process, hoping due with each reservation fees and preparing special reports and the downloading of data for processing companies.

You cannot ignore the possibility of reservation from own website of the hotel, because it is the most cost-effective booking channel. Over the last four years in the world, the volume of Internet bookings increased by 500 percent, the growth of the Internet in the CIS countries in 1998 exceeded 350 percent, and the technology of electronic Commerce in tourism in the countries of the region are in third place in popularity.

When presenting to the external booking systems raises the question of the timing of the availability of number Fund of the hotel with databases availability of “external” systems. This is important because when you use the Internet booking have to be given about vacant and occupied rooms online.

5.2. Efficiency of the hotel

The efficiency is determined by both General and specific indicators of efficiency of activity of the enterprise.

Common indicators include the dynamics of revenue and profit from main activity of the enterprise, the indicator of costs per ruble of revenues received from main activity of the enterprise, productivity and profitability.

The specificity of calculation of indicators of efficiency of activity of the hotels is that the revenues from the hotel will depend on two factors: the number of sold room-days and rate. Therefore, an important indicator of the efficiency of hotels is the coefficient of load of the rooms.

Thus, the indicators with which to assess the efficiency of the hotel include:

1) load factor equal to the ratio of the number room-days capacity of the hotel. Throughput shows the number of charge-nights, which can be provided, and is calculated as the product of the number of seats and number of days of operation of the hotel during the period;

2) the profitability of the revenue as the ratio of profit from the chambermaids to the revenues from its operation;

3) cost efficiency as the ratio of profit from the chambermaids to the cost.

It should be noted that the effectiveness of the accommodation depends on such factors as location relative to the stations, airports, ports, cities, and the economic and cultural attractiveness of the city in which the hotel is situated, the class and tradition of the hotel.

The economic efficiency indicators of hotel activities also significantly affected the activity measures advertising, the availability of information about hotels in reference systems as the city in which the hotel is situated, and beyond. The hotel's participation in various economic and cultural events of the city.

5.3. Optimal loads of rooms

The main resource of the hotel is its room capacity, and proper management of the booking process will allow you to use it most effectively.

In the opinion of the specialist in hospitality service N. Balba, believes that the lack of integration of management systems with the online booking or the Central reservation of tour operators there is a need to allocate a certain quota of rooms for sale in external systems. If the tour operator pays for every room of the allocated quota, regardless of whether this guest room is implemented or not, risk possible sale of part of rooms the hotel has to provide the operator with significant discounts (20% or more). If rooms are allocated for sale by the tour operator or through the online website of the hotel without paying for unsold rooms, the lack of integration between the management system and reservation system, the hotel is forced to manually maintain the quota availability in external systems, and in the days of high download do to close the sale of rooms through the outer channels.

Thus, if there is only one number, it will probably remain unsold, though it could be implemented via the Internet and other external channels remaining closed for fear of overbooking (Krasyuk et al., 2017). The importance of this problem has long been understood in the West, where it was called the problems “of having the last number” (“last room availability”).

The issue price is calculated very simply – the amount of lost profits from unsold rooms at published rates of the hotel during periods of high demand. Modern systems and their possible integration with external sales channels, primarily the Internet website of the hotel, to solve this problem.

Further, there arises a problem of sale license plate Fund in the first place with the highest prices and giving discount rates only after the adoption of the best for hotel bookings. To do this the right way to build a sales strategy, and management systems help to do it, allowing you to set sales quotas of rooms for different tariff groups. For each day in the future is based on historical data, the expected possible number of room sales at the highest rates (for corporate and individual clients) and therefore exhibited for sales quotes tariffs to reflect expected “expensive” demand, enabling you to sell at low rates only the remaining part of the inventory. Continuous monitoring of the dynamics of receipt of bookings with the indicator “booking period” (“lead time” - the period of time between placing an order for your booking and date of arrival of the guest) allows the flexibility to change the ratio of the sales quotes tariffs.

For optimal load of the rooms, you must book specific rooms, and only a few number Fund of a particular type.

Modern control systems allow you to do so, taking account of the availability of the rooms for room types and not for specific rooms. In particular, the practice of reservation types of rooms, not the rooms, allows to avoid situations when you have to refuse a booking or a guest who came for two nights and the hotel is not any rooms free both nights, and there is only room free only for the first night and another room free in the second, but busy in the first.

To maximize the impact of number Fund is achieved thanks to the capabilities of control systems to estimate the expected percentage of races in each category or segment of the market and establish the appropriate allowable percentage of re-bookings, and maintain the waiting lists. If the hotel regularly loses 3-5 % armor from no-show, the figure can be if not reduced to zero, to significantly reduce.

The indicator of load of the rooms of the hotel also affects the factor of consumer preference. Depending on the priorities of the clients their choice of particular hotels.

When choosing a specific hotel to accommodate potential customers enjoy the following considerations: security considerations, cost savings, innovation and originality of the proposed hotel product, the comfort, the prestige, the popularity and reputation of the hotel, faithful to tradition, the purpose of the trip.

In conclusion I must say that there are many factors (internal and external factors) that affect the preference of consumers. Determined by the influence of external components of reality, not connected with the operation of the hospitality industry. Internal directly connected with the peculiarities of organization and functioning of the hospitality industry. There are also factors that increase the work efficiency and the occupancy rate of hotel business. These include: special marketing programs, the introduction of new technologies, modern systems of booking.

The whole consideration of these factors helps to identify problems in hotel companies. And helps in the development of new technologies and attract tourists.

Bibliographic references

Barchukov, I.S. (2016). Hospitality industry of tourist accommodation. Moscow: KnoRus.

Feoktistov, I.A. (2017). Hotel business. Peculiarities of accounting and taxation. Moscow: GrossMedia, RosBuh.

Gronroos, C. (2011). Management and Marketing: marketing the moment of truth in service competition. Toronto: Lexington Books.

Krasyuk, I.A., Krymov, S.M., Medvedeva, Y.Y., Chernisheva, A.M., & Lashko, S.I. (2017). Marketing Management in Retail Chains. International Journal of Applied Business and Economic Research, 15(12), 83-91.

Litvak, B.G. (2016). Business leaders. The technology of success. Moscow: Business.

Lockwood, A. & Medlik, S. (2001). Tourism and Hospitality in the 21st Century. Orlando.

Lomova, L. A., Shiryaev, D. V., Kobersy, I. S., Borisova, A. A., & Shkurkin, D. V. (2016). Marketing techniques in management of enterprises engaged in tourism. International Review of Management and Marketing, 6(6), 15-20.

Mamycheva, D. I., Kobersy, I. S., Korenko, Y. M., Novikov, V. S., & Mandrik, N. V. (2017). Management of tourism and technology of planning of the tourist product. International Journal of Applied Business and Economic Research, 15(12), 215-224.

Mindlin, Yu.B., Kolpak, E.P., & Gasratova, N.A. (2016). Clusters in System of Instruments of Territorial Development of the Russian Federation. International Review of Management and Marketing, 6(S1), 245-249.

Medlik, S. & Ingram, H. (2017). Hotel business. Moscow: Unity-Dana.

Popov, V.M., Marshavin R.A. & Lyapunov S.I. (2017). Global business and information technology. Moscow: Finance and statistics.

Reznichenko, S.M., Vasilieva, N.K., Shichiyakh, R.A., Medvedeva, Y.M., & Mindlin, Y.B. (2016). Agrarian policy of the region in terms of economic development innovation. International Journal of Economics and Financial Issues, 6(S8), 245-250.

Sizykh, N.V. (2007). The performance assessment of the hotel complex and its subdivisions. Hospitality, 3.

Sorokina, T.V. (2010). Management of competitiveness of the tourism and hospitality sites in the Russian Federation. Moscow: Rudomino.

Valentinovich Bogoviz, A., Grigor'evna Vukovich, G., & Stroiteleva, T. G. (2013). Modeling the labor process one of the tasks of strengthening of positive trends in the economic growth of the industrial enterprises of the region. World Applied Sciences Journal, 25(8), 1222-1225. doi:10.5829/idosi.wasj.2013.25.08.13389


1. International Innovative University, Sochi, Russia, E-mail: velichkonu@mail.ru

2. Plekhanov Russian University of Economics, Moscow, Russia

3. Southern Institute of Management, Krasnodar, Russia

4. Kazan Federal University, Yelabuga, Russia

5. Kuban State Technological University, Krasnodar, Russia


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