Background of Ginger Hotels:

 Roots Corporation Limited is a wholly owned subsidiary of the Indian Hotels Company Limited.
IHCL is a part of the Tata Group of companies, which is India’s premier business house. On
December 24, 2003, RCL operated the first of its kind category of ‘Smart Basic’ hotels across
India. RCL develops and operates a fast-expanding chain of economy hotels across India under
the “GINGER” brand.
 Ginger has positioned itself as a no-frills budget hotel. The Ginger hotels are built around a
unique concept that provides facilities to meet the key needs of today's traveler, at surprisingly
affordable rates.
 What is the objective behind launching the chain of hotels? Well to answer this question, the
primary objective here is to provide superior product offering and consistent experience to
traveler’s, beyond the present offerings in the industry which can be viewed as their business plan
or strategic plan.
 The whole business process can be divided into core process, management process and support
process and below is shown the activities related to these broad classifications:

Management Business Processes • Planning

in a Hotel • Market development
• Marketing
• Quality management
• Environment management
• Security/safety at work management

Core Business Processes in a • Producing food and beverages

Hotel • Serving meals and beverages
• Reception and accommodation of guests

Support Business Processes in a • Human resources management

Hotel • Financial management
• Infrastructure maintenance
• Information management
• Purchase
• Sale at restaurant

 Now we would shed some light on how the operation system is planned and executed in
alignment to their strategic proposition of being affordable yet being “smart”:
 Fixed price model- Tariffs are fixed irrespective of properties or location.
 Opting for a no frill model- All the necessary comfort amenities are available, for
instance Posturepedic mattress, good quality linen, LCD TV with Tata sky
subscription, tea/coffee maker, mini fridge, free WIFI. The unique service offering is
to forgo the traditional elements like service of doorman, valet, swimming pool,
restaurants even the room service is limited.
  In order to take care of the cost elements most of the services were self-service with a
tagline of “Please help yourself” with Self Check-In Kios, “Give n’ Take” Counter
which guest can use to deliver used clothes for laundry.
 There is an ironing room in every floor of ginger hotel. Further are water dispensers on
each floor. Ginger hotels also have round the clock vending machine to provide with
packed snacks and hot/cold beverages irrespective of the working of the restaurant.
 In addition, a vending machine to supply other things like toiletries, combs,
toothpastes, soaps, mosquito repellents etc. ginger has outsourced food and beverage
partners operating on a revenue share model.
 The size of the room in the hotel is kept small around 180 sq. Feet as compared to 250-
400 sq. Feet of premium hotels.
 The concept of “Help Yourself” has helped the company in operating the hotel with
just 25 staff members as compared to premium hotels where they employ around 250
people.
 Talking about location planning they are situated near railway stations and bus stops
and are situated in places, which can be beneficial for both business people and
tourists.
 Most of the employees are outsourced thus ginger maintains a low amount of staff as
the hotel does not offer any room service thus it helps in providing cost benefit.
 They have also taken a great consideration for disabled people by designing the last
room in the hotel especially for them.

So, after getting a basic understanding about the operations at Ginger we move ahead to answer the
questions given below:

1-How will you describe the overall strategy of Ginger Hotels in the hotel industry?

 The overall strategy of Ginger Hotels seems robust especially since it has uniquely
positioned itself as one of the “smart” hotels for today’s travelers. It has influenced
the domestic hospitality industry in a positive way by providing intelligent and well thought of
facilities to its customers.
 Ginger hotels are built around the unique concept that provides facility to the traveler’s at
surprisingly affordable rates which in turn helps Ginger to lead amongst the similar competitors.
It operates in the three-star category, prices its rooms competitively -- single rooms cost Rs 999,
while a double room won't set you back by more than Rs 1,799, inclusive of taxes.
 The other unique strategy we would like to mention is that the tariffs are the same whether you're
in Bangalore or Bhubaneswar, and whether it's January or June so we don’t really see a price
discrimination and hence it does justify the stance of being affordable.
 It is able to capture a huge market share, especially that of a young traveler who isn’t willing to
spend a huge amount of money for accommodation.
 Another strategy worth appreciating is Smart Basics concept was co-created by Ginger with the
help of the Renowned Management Guru CK Prahlad.
 Smart Basics is a philosophy of providing intelligent, thought-out facilities and services at a
value pricing. It reflects the new emerging lifestyle in which people want to get things done
quickly and efficiently. Smart Basics provide a value proposition of a different kind. It represents
 a Next Generation category that signifies Simplicity, convenience, informality, style, modernity
and Affordability.
 The tag line “Please help yourselves” uniquely distinguishes Ginger Hotels from rest of the hotel
by providing trendy and innovative options like self-service check in, Give n’ Take Counter,
Smart Get Set, Smart Knick Knacks and Smart Mart.
 Ginger Hotels overall strategy has been always to play on the volume rather than the pricing. By
providing niche services at low cost, it bets a larger market share by capturing a substantial
number of travelers, customers who enjoy having complete control of their stay in a hotel.
 Another unique strategy Ginger Hotel follows is not to incur too much of expenses in decorating
rooms with fancy items which majority of the customers seldom use. Some of such services
which the hotel has not gone ahead with are doorman, valet. In case customers do not the food,
they are even are provided with the option of ordering from outside and collecting it from the
Give n’ Take Counter thus providing flexibility as a means of strategy with barely other hotels
provide. The pricing remains fixed even in times of demand surge. Ginger Hotel targets middle
class family who has a substantial amount of disposable income.
 They also believe more on organic growth and keep adding to their customer base in regular
intervals. They strategically position themselves amongst business and leisure centers. Overall,
the strategy has allowed it to lead the “smart” hotel segment of the industry.

2-Is their operations strategy consistent with the overall strategy? What are the operations
strategy elements of Ginger Hotels that provide this strategic dimension to the operations?

 The overall strategy of Ginger hotels has always been to provide affordable hospitality
solutions to customers while retaining quality of those services.
 It can be definitely that their operational strategy is quite consistent with the overall
strategy, which will be evident with the examples that are given below.
 The pricing propositions are much lower than other hotels in the market. A large part of
the Indian population does not want to spend a huge amount while staying in hotels,
especially if it is a longer itinerary which helps them to achieve their goal of providing
affordable solutions to the customers.
 They believe in simplicity and convenience which portrays in the various self-help
options provided by them. Essentially, Ginger Hotels have been able to increase the value
while decreasing the cost for customers. The sizes of the rooms are comparatively smaller
than other hotels, which also helps them on cutting expenses to a large extent.
 Being a subsidiary of the Tata group, they leverage their brand value, reputation and
goodwill and brand recognition. This in turn helps them to reach a wider customer base
who are price sensitive.
 The different operational elements used by Ginger Hotel that provide a strategic
dimension for operations is unique pricing proposition, geographic locations, cutting
down on excess staff operational expenses by removing bellhop services, room services,
providing attractive discounts for people registering through internet thereby reducing the
marketing costs, hassle free reservations from individuals to groups, providing budget
healthcare services like yoga, meditation, Ayurveda.
 By implementing Smart philosophy, the Ginger Hotels has been able to cut down the
turnaround time for solving customer queries and problems thus reducing operational
 complexity of the entire process. They have built most of the strategies to simplify each
of the processes thereby reducing costs as well.

3-Can you identify the strategic and operational benefits that the Ginger Hotels is likely to
derive from the operations strategy and operations systems design that it has chosen?

 Pricing the rooms at a much lower cost than other hotels, Ginger Hotels has a strategic
advantage when it comes to capturing the young Indian market. Many young travelers are
willing to spend less and less in accommodation without losing a lot of necessary hotel
services.
 Another operational benefit they have achieved from the system design is of saving on
time and human resources by establishing self-help services. Majority of these processes
like check-in, laundry services, 24x7 vending machines and many such facilities. They
can improve their operational efficiency by reducing the manpower required and thereby
the resource cost as well.
 Providing a hassle-free booking services will not only reduce the turnaround time for
such activities but would also take care of the Reneging and balking of the customers.
 Standing by the philosophy of standardized and consistent services for everyone saves
them a lot of operational overhead which comes from customizing requests taken to
please the customers. Not all the customers need customized services and if there is a
cost-benefit analysis, customers would be more willing to pay less for the services they
are not even going to use.
 Operational overhead decreases when customers can get toiletries, combs, toothpastes,
soaps etc. directly from the vending machines rather than having to call room service all
the time. Also, water dispensers are installed in all the floors thereby reducing operational
complexity.
 The business strategies enforced by Ginger Hotels is quite unique and would be enticing
majority of the population especially when finding good accommodation options at a
nominal price is a difficult in India. To improve its operational efficiency and
profitability Ginger Hotels should aim at acquiring more audience by also diversifying
into other cities with their cost-effective model.