Business Process Management in Hospitality Case Study

Business Process Management in Hospitality - Case Study Example Configuration is defined as "making choices about what a company will do and how it will do it, andensuring that the things a company does reinforce each other". They argue that the lack of a focused competitive strategy is one of the key causes of poor organisational configuration. However, the problem of organisational configuration is not just restricted to understanding markets, with poor configuration being found in a number of key areas, including hospitality SMEs' relationships with their customers, which are fraught with uncertainty. There is an acknowledged advantage in that small firms are closer to the customer, enabling more personal relationships to develop (Crook , 2003). However, this is tempered by the danger that having a limited customer base (Gray, 2005) facilitates the development of deferential supplier-customer relationships. Research by Harrison (2003) concludes that, apart from those firms which operate only in very low profit or niche markets, hospitality SMEs are consistently found to be subservient to their larger counterparts. This view is supported by Wong (2005) who suggest that hospitality SMEs have a lack of control over their futures because of demands made by stronger customers throughout the supply chain. An additional burden is a lack of power to leverage payment of debts from these customers, as noted by (Okumus, 2003), who point out that many smaller firms are "afraid to press customers too hard for payment for fear of loss of future business". It is this scenario which most severely affects hospitality SMEs as their limited resources cannot cope with the fluctuations in cash flow that late payment inevitably brings. The overall effect of the fiercely competitive environment in which hospitality SMEs operate is that, very often, strategic planning becomes a seemingly pointless exercise, again lowering competitive advantage through poor organisational configuration. Tangen (2004) points out that unless the internal structures and the external competitive environment of the hospitality SME are effectively aligned with its strategy, it is unlikely that it will ever be implemented successfully. The difficulties associated with aligning strategy to the external competitive environment led ( Harrison, 2003) to conclude that the majority of hospitality SMEs in the automotive sector are not concerned about future strategic developments, as survival in the supply chain requires them only to maintain a reactive strategy. In addition, McAdam (2004) found that it is not unusual for firms to retain the original strategy developed by the founder, thereby leading to a "strategic hangover", which, if the competi tive environment or the company structure has changed, may actually be detrimental to future business success. Furthermore, there is evidence to suggest that many established hospitality SMEs rely solely on internal or financial planning as their main approach to preparing for the future (Crook, 2003). This might be due to the fact that accountancy information has been shown to be the most important factor in determining survival or