An

Industrial Project Report

On

The Fern Residency – A Concept Hospitality Venture

Kum. M. H. Gardi School of Management

IN PARTIAL FULFILLMENT OF THE

REQUIREMENT OF THE AWARD FOR THE DEGREE OF
MASTER OF BUSINESS ADMINISTRATION
In
Gujarat Technological University
Under the guidance of
Submitted To:
Faculty Guide: Company Guide:
Prof. AshitamansuriyaViral Ganatra
(Assistant Professor) (Marketing Executive)
Submitted By:
Ms. Jeenu Vadera
Enrollment no. 167270592059
Batch-2016-2018
MBA Semester-2
Kum. M. H. Gardi School of Management
MBA PROGRAMME
Affiliated to
Gujarat Technological University
Ahmadabad

1
 Index

Sr. no. Particular Page

No.

Part – I

1. Industry Overview 3

2. Company Introduction 5

Owners 8

Products/Services 10

Establishment/History 14

Managerial Structure/Organization Chart 16

Departmentalization 19

Operation Hours 22

Part – II

3. Accounting for management 24

4. Economics 29

5. Managerial communication 33
6. Organization behavior 39

7. Principle of management 46
8. Research methodology 51

9. Quantitative analysis 56
10. Conclusion 61

2
INDUSTRY
OVERVIEW

3
Hotel Industry in India has witnessed tremendous boom in recent years. Hotel Industry is
inextricably linked to the tourism industry and the growth in the Indian tourism industry has
fueled the growth of Indian hotel industry.

The thriving economy and increased business opportunities in India have acted as a boon for
Indian hotel industry. In recent years government has taken several steps to boost travel &
tourism which have benefited hotel industry in India. Training & Development plays an
important role in Hotel Industry.

Being service industry, unlike other businesses / industrial sectors, the hotel industry requires
their employees updated and trained with special skills along with technological skills /
advancement, due to higher customer expectations and to meet current and future business
requirements.

In hotel industry personalized services are of more importance, directly related to human
behavior which requires special training to develop soft skills as to meet high customer
expectations and to deal with day to day business.

In terms of making employees principled and productive at their job, employees need to be
trained on regular basis.

4
 COMPANY
INTRODUCTION

5
Concept Hospitality Pvt. Ltd. (CHPL) is a leading hotel management and consultancy company
based in Mumbai, India. Incorporated in 1996, we have built, managed and consulted with over
125 hotels, resorts, convention centers, mixed-use projects and serviced apartments in India,
Africa, China and Asia Minor.

CHPL is renowned as the architect of the 'green hotel ‘trend in India, one that has grown into a
movement and an industry standard. We are proud to maintain this leadership position even
two decades later.

CHPL is also the parent company of the only hotel brand in the world that has made responsible
environment practices its main philosophy. The Fern Hotels & Resorts was launched in
2009.With the baseline 'Leading environmentally sensitive hotels', The Fern Hotels & Resorts is
amongst the fastest growing hotel brands in India with 2000 rooms and suites under
management and another 1100 rooms expected by 2017-18 with vibrant pipeline of 19 projects
in various stages of development.

With the baseline 'Leading environmentally sensitive hotels', The Fern Hotels & Resorts is
amongst the fastest growing hotel brands in India.

BRANDS :

The Fern is a collection of hotels & resorts with a 5-star & above classification. This is a full-
service experience with premium accommodation and services.

6
The Fern Residency is a mid-tiered experience of hotels and resorts in the 3 and 4-star
categories. The Fern residency Rajkot is one of them. They offer up market accommodation and
services ideally suited to the emerging traveler.

7
OWNERS

8
Concept Hospitality Pvt. Ltd. Do not manage the day-to-day operations of the Hotel; it will only
supervise the management company.

CONCEPT HOSPITALITY: Below listed are the Directors and Managers:

List of Directors

Mr. KonathParameswaranKannampilly:Managing Director

Mrs. Sabrina Kannampilly : Director
Mr. BinodChaudhary : Director
Mr. Ram Mallar : Director
Mr. Rahul Chaudhary : Director
Mr. VarunChaudhary: Director
Mr. Chandrasekran S. : Director

The Ownerof THE FERN HOTEL Rajkot isMr. SHYAM RAICHURA.

9
SERVICES

10
The Hotel Facilities and services include includes the following:

Express check-in & check-out, Spa & sauna, Business center, Wake-up calls, Multiple languages
spoken by staff, Gymnasium, 3 meeting venues for up to 410 guests, Patisserie/cake shop,
Specialty dining, 24-hour coffee shop, The Fern Club Lounge, Same-day laundry service, Safe
deposit box, Access facility for the differently-abled, Free car parking, Foreign exchange
conversion, Airport & local transfers, Smoking & non-smoking guest rooms , High-speed Wi-Fi
Internet, Full service travel desk, Babysitting service, Doctor-on-call, 24-hour concierge & front
desk etc.

Tatva Spa & Gymnasium:

The Tatva Spa is based on the Indian culture of holistic healing of the mind-body and spirit.

Accommodation:
Rooms have all the modern amenities and facilities necessary for a successful business traveller.
All Winter Green rooms are a comfortable sized with ensuite bathrooms. The Fern Club rooms
have enhanced business facilities and offer access to additional services. Each suite is a luxurious
in size with an executive business room, a private bedroom and a two-person bathroom
complete with a bathtub.

Rooms are available in Hazel Suite, Fern Club and Winter Green categories.

 The Grand Ballroom

It is the colossal multi-purpose venue having a capacity of over 500 people, can be
partitioned into smaller units as per the requirements of guests.

 Winter Green (220 sq. ft)

A Winter Green room is base category and offers both twin and queen bed options.
Modern yet simple in design, a Winter Green room offers guests a winning combination
of essential business services and comfort.
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  Deluxe luxury rooms
Deluxe luxury rooms have well-appointed modern amenities.

 The Fern Club (320 sq. ft.)

The Fern Club guests receive free high speed Wi-Fi and access to The Fern Club lounge, an
exclusive area for private meetings, personalized service and complimentary snacks and
beverages.

 Hazel Suite (570 sq. ft.)

The Hazel Suite offers a grand living experience at a truly spacious room and offers full
access to The Fern Club Lounge and free high-speed Wi-Fi. The bedrooms feature a
luxurious closet, a 40” LCD TV and a working desk.

Room Facilities:

High-speed Wi-Fi Internet, Minibar & gourmet corner, Bathtub in suite rooms, 24-hour in-room
dining, 24-hour housekeeping, 40" flat screen TV with international entertainment and news,
DVD player, Separate shower cubicle, Complimentary bottled water, Digital in-room safe,
Complimentary tea/coffee maker, Central air-conditioning, Shaving mirror, 24-hour hot & cold
water, Eco-friendly bath amenities, International in-room direct dial phones with message
facility, Full-length wardrobe with bathrobe, Pillow menu, Movie library, Business desk with
international power sockets, Ironing board (on request), Hair dryer, Complimentary newspaper
every morning etc.

Dining:

Indulge in exquisitely prepared cuisine in an elegant, relaxing atmosphere in Rajkot’s favourite

restaurants. Offers five dining options serving international, Indian, Jain and Gujarati classic
cuisines. Only pure vegetarian food is served

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 Bollywood Tadka
It is a film-themed fine dining restaurant on the hotel’s rooftop. It is ideal for dinner
entertainment; the open-air restaurant is designed as a creative space where Bollywood
art, music, food and culture converge under the night sky.

 Garden Café
Garden Cafe on Level 1 is the only premium coffee lounge in Rajkot. Enjoy the best coffee
within exclusive snack menu and a library of the latest newspapers and magazines.

 Sweet &Savoury
Sweet &Savoury in the lobby is a popular Patisserie that offers a wide variety of pastries,
cakes and sandwiches.

 Waves
Waves at the lobby-level are an all-day multi-cuisine restaurant with the largest buffet
set-up in Rajkot serving local and international favorites.

 In-room Dining
Sometimes the perfect place to go is no place at all. In-room dining service presents a
high quality dining experience in the comfort of your room. From a menu of 150+ items

 Banquet and Conference Facilities:

The Fern Residency, Rajkot has one of the largest indoor meeting and banquet facilities,
making it the preferred choice for business and family events. The hotel offers the
additional USP of hosting the most environmentally friendly banquets and conferences.

13
HISTORY

14
Concept Hospitality Pvt. Ltd. was formed on 10th July, 1996 and made a deemed public limited
company on 16th February, 1998, and was recently deemed as Concept Hospitality Pvt. Ltd. On
March 14th 2009 Mr. ParamKannampilly bought out Kamat Hotel India’s stake in Concept
Hospitality.

The Fern Residency Rajkot was established in 18th November 2012, promote by Mr. SHYAM
RAICHURA.

15
ORGANIZATIONAL
CHART

16
17
18
Below is the DesignationList :
 General Manager:Bikash Chandra Saha.
 HR Manager : NishaKumari
 Executive House Keeping : Sanjeev Singh
 F&B Manager : KamlaKantaKhatua
 Financial Controller : Sanjay Kumar Bhatti
 Sales and Marketing Manager : KishorMilani
 Chief Engineering Head : Atmaram Patel
 Security Manager : MagejMeena
 Front Office Manager: Abdul Kader Lokhandwala.
 IT Manager : Prem Kumar

19
DEPARTMENTALIZATION

20
21
Departmentalization:

The Department of the hotel basically segmented into 9 divisions: finance, front office, human
resources, food and beverage, sales and logistics, housekeeping, IT and chief Engineering
department, Security.

 Financial

The financial department’s role is to record financial transactions, prepare and interpret
financial statements, and deal with cost accounting and cost control.

 Front Office

The front office (room management) department handles customer service including front desk
service, reservation, laundry, concierge, telephone, and housekeeping service. The hotel’s front
office is where guests are greeted when they arrive, where they get registered and assigned to a
room, and where they check out. It’s almost the most important department as it often offers
contact with customers.

 Human Resources

The human resources department is given the responsibility to handle employee recruitment,
arrange staff training, make promotion and disciplinary decisions, and check staff attendance.

 Food & Beverage

The food and beverage department is responsible for all of the dining rooms, restaurants, bars,
kitchen, clean up services, etc. Here we basically divide F/B department into two parts: kitchen
and restaurant. Kitchen department is responsible for food preparation including main food,
dessert, side food, and beverage. Restaurant department‘s role is to provide dining room
operation, waiter service, food runner, and clean up service.

22
  Sales

The responsibility for sales department is to sell the hotel facilities and services to individuals
and groups. They sell rooms, food, beverage or special service such as massage and laundry to
potential customers through advertising or direct contacts.

 Logistics

The logistics department is responsible for tracking for daily supplies, purchasing appliances,
and keeping security.

 House Keeping

In addition to basic duties, hotel housekeeping employees change sheets and make beds in the
guest rooms. They keep the rooms stocked with clean cups, coffee supplies, towels and other
bathroom items, such as shampoo.

 IT and Chief engineering Department

Maintain the physical appearance and operational efficiency of the hotel including physical.
Mechanical, electrical, plumbing etc. Installation & maintenance of all equipment related to
HVAC, DG Sets, Water treatment, Fire Safety etc, .Responsible to manage all aspects of
maintenance staff on a daily basis. Directs, coordinates and performs routine, preventive and
emergency interior / exterior maintenance and repairs to obtain optimum efficiency and
economy of hotel operations.

 Security

They work hand in hand with security personnel in carrying out evacuation drills and safety
checks of the property. Protect the guests and staff of the hotel, including all of their property.
Secondarily the security department’s role in a hotel is to secure the actual premises, and the
property of the Hotel itself

23
OPERATIONAL
HOURS

24
The Hotel works 24 HOURS AND 7 DAYS a Week Round the year.The Hotel functions are divided
department wise, so their shifts.

25
 2810001
Accounting for
Managers

26
Definition:

The process of preparing management reports and accounts that provide accurate and timely
financial and statistical information required by managers to make day-to-day and short-term
decisions
It’s recording, analyzing, interpreting and classifying the transactions. It is used to apply general
management principles of financial resources of the enterprise.

Evaluation of financial performance based on Ratio Analysis:

Ratio analysis is the process of determining and interpreting numerical relationships based on
financial statements. It provides a measure of the relationship between two variables or figures.
This relationship can be expressed as a percent or as a quotient.
 Short term Solvency Ratios
This attempt to measure the ability of a firm to meet its short terms financial obligations. That
is, these ratios seek to determine the ability of a firm to avoid financial distress in short- run.

(A) CURRENT RATIO :

It’s the ratio of current assets to current liabilities.Current assets are the assets that the firm
expects to convert into cash in the coming year. Current liabilities are a company's debts or
obligations that are due within one year, appearing on the company's balance sheet and include
short term debt, accounts payable, accrued liabilities.However, the current ratio should be
greater than one.

Current Ratio = Current Assets / Current Liability.

27
 Year Ratio
2015 2.03
2014 1.90
2013 1.95

2.05

1.95
Current Ratio
1.9

1.85

1.8
2015 2014 2013

(B) LIQUID RATIO :

If the inventorieshad to be sold off in a hurry to meet an obligation the firm might have
difficulty in finding a buyer and the inventory items would likely have to be sold at a substantial
discount from their fair market value. Liquidity ratios attempt to measure a company's ability to
pay off its short-term debt obligations. This is done by comparing a company's most liquid
assets (or, those that can be easily converted to cash), its short-term liabilities.

Liquid Ratio = Liquid Assets / Liquid Liability

Year Ratio
2015 1.27
2014 0.97
2013 0.43

28
 1.4
1.2
1
0.8
0.6 Liquid Ratio

0.4
0.2
0
2015 2014 2013

 Profitability Ratio :

Profitability ratio measures profitability, a way to measure a company’s performance.It’s simply

the capacity to make profit and a profit is what is left over from income earned after you have
deducted all costs and expenses related to earning income.

(A) GROSS PROFIT RATIO :

GROSS PROFIT RATIO = (GROSS PROFIT * 100) / NET SALES

Where Gross Profit = Net Sales – Cost of goods Sold

Net sales = Total Gross sales – (Return inwards + Discount Allowed)

Year Ratio
2015 2.03
2014 1.90
2013 1.95

29
 16
14
12
10
8
GP Ratio
6
4
2
0
2015 2014 2013

(B) NET PROFIT RATIO :

NET PROFIT RATIO = (NET PROFIT *100) / NET SALES

Year Ratio
2015 8.53
2014 14.99
2013 14.13

16
14
12
10
8
NP Ratio
6
4
2
0
2015 2014 2013

30
 2810002
Economics for
Managers
31
Study of the type of costs involved in a Industry : The terms Variable costs and fixed costs in
hotel operation is used to distinguish between those costs that have direct relationship to Hotel
occupancy and those that has no relation to occupancy and business .

 Fixed Costs: Fixed costs are normally not affected by changes in occupancy or sales
volume. They are said to have little direct relationship to the business volume because
they do not change significantly when the number of sales increases or decreases.
The term fixed should never be taken to mean static or unchanging,but merely to indicate
that any changes that may occur in such costs are related only indirectly or distantly to
changes in volume.
Examples of Fixed costs are:

 Land, Building Taxes to government.

 Wages to employees.
 Hotel employees’ health premium.
 Out sourced services contracted for fixed amount in a month eg :security services.
 Yearly maintenance contract fees ( AMC ) for all equipment, machineries and Hotel
Management software
 Fixed internet, telephone plans.

Variable Costs: Variable costs are clearly related to hotel occupancy and business volume. As
business volume or occupancy increases, variable costs will increase; as hotel occupancy
decreases, variable costs should decrease as well.
Examples of variable costs are:

 Food, beverages, housekeeping cleaning supplies.

 Flower arrangements.
 Guest room amenities.
 Stationeries used in Front desk and restaurants.

32
  Chemicals for laundry and water treatment plants.
 Flower & decorations.
 Guest supplies -amenities.
 Laundry operations, Laundry Uniform.
 Printing supplies. Etc.

Say let’s take the data for Quarter 1

PAYTOLL & RELATED Apr-14 May14 Jun-14 Q1 TYPE
330,00
Salary & Wages 110,000 110,000 110,000 0 FC
Gratuity 1,634 1,634 1,634 4,902 FC
Co. Cont. To PF 5,000 5,000 5,000 15,000 FC
Co. Cont. To ESIC 2,000 2,000 2,000 6,000 FC
Staff Meal 10,000 10,000 10,000 30,000 FC
Rental Apartment/Staff 2,199 2,199 2,199 6,596 FC
Bonus/Exgratia 2,500 2,300 2,335 7,135 VC
Stipend Industrial Trainee 3,000 2,000 1,500 6,500 VC

Total Fixed Cost = Rs 392,498

Total Variable Cost = Rs 13,635

33
Total Cost = 392,498 + 13,635 = Rs 406133
Now similarly for Quarter 2
PAYTOLL & RELATED Jul-14 Aug-14 Sep-14 Q2 TYPE
330,00
Salary & Wages 110,000 110,000 110,000 0 FC
Gratuity 1,634 1,634 1,634 4,902 FC
Co. Cont. To PF 5,000 5,000 5,000 15,000 FC
Co. Cont. To ESIC 2,000 2,000 2,000 6,000 FC
Staff Meal 10,000 10,000 10,000 30,000 FC
Rental Apartment/Staff 2,199 2,199 2,199 6,596 FC
Bonus/Exgratia 2,624 2,355 2,585 7,564 VC
Stipend Industrial Trainee 3,000 2,000 1,500 6,500 VC

Total Fixed Cost = 392,498

Total Variable Cost = 14,064
Total Cost = 392,498 + 14,064 = 406562

Hence as we plot the graph for Quarter 1 VS Quarter 2: Expenses made under Payroll and
benefit:
450000
400000
350000
300000
250000 Fixed Cost
200000 Variable Cost
Total Cost
150000
100000
50000
0
Quarter 1 Quarter 2

34
Hence we can conclude that there is a direct relationship between Fixed and Variable cost, if
one of them changes the Total cost of the service provided or the total expenses increases.

2810003
Managerial
Communication

Communication and types of communication used at the Fern:

Basically, the word communication refers to the exchange of information and ideas between
two individuals or business organizations about their needs, aspirations, or perceptions, in
words, action or symbols, provided the content must mean the same for the receiver and
sender.
35
Communications can be of a local or international flavor, in spoken or alternative modes, and
depend on conformist or unconventional signals in non-linguistic or linguist forms.

What do you think should be the most important quality of a hotel manager? If someone
were to ask me, I’d say it would be the capability to communicate effectively with the staff,
colleagues and guests. In this new age of electronic communication, one should not forget
that effective verbal and non-verbal communication skills should be emphasized and well-
executed in the hospitality industry.

There are two types of business communication in an organization, which come under “Vertical
Communication
1. Internal Communication
2. External Communication

 Internal Communication

All communication that has to do with internal matters and interaction between staff
and employees in varied forms is called “Internal Communication." And it serves as an
excellent medium to address all concerns of employees, thereby enhancing goodwill, job
satisfaction, productivity and safety aspects. It also serves to increase turnover and
profits.

The Fern is very peculiar about the internal communication, due to which they have
achieved

Keeping this in mind

 The Fern provides various soft skills and Business adequate trainings to their employees.
This is done in their Induction period :

36
 -Employees are trained to deal with complaints.
-Coordinating between departments,
-Attending to guests at the front desk and helping in documentation like menus, bills,
reports and hotel procedure.

 They have periodic meetings for two – way communication :

-This is ensured by having monthly departmental meetings.
-Weekly feedback sessions, the hotel staff is motivated and rewarded for their
important feedbacks.

 Whenever any employee has any concern or internal conflicts, they can meet and
talk to their departmental heads, if not resolved this matter can also be taken to the
HR department.

External Medium of communication:

Some of the other facets of communication are enumerated below:

 Face-To-Face Communication

Still the oldest, but the most effective mode of communication is the face-to-face type
that requires the physical presence of both parties involved, removing any vestiges of
ambiguity and making absolutely 100 % certain that matters have been mutually
understood. Once this is achieved, further discussions can be held at any time without
inhibitions. You can also make your pitch in a manner that will directly convey your
feelings, passion and commitments to an individual or at a group meeting. Most experts
opine that this is the best form indeed to make an impression the vital points pertaining
to your company your audience.

37
 Phones
The phone is a more personal form of communication than the email, and can add a
personal touch to messages of complex nature that need the clarity of a phone call to
explain some intricacy involved that cannot be put into a message. Its great advantage is
that you can reach people with clarity, all round the globe when you want to confirm
your associate’s accurate understanding of your message.

 Verbal
Verbal communication includes direct face-to-face meetings, meetings, video
conferencing and telephoning and may well be an excellent communication mode by
reading the inferences you make out of the non-verbal or verbal responses of a
message. Additionally, it puts the message receivers at ease to pose questions to the
sender and obtain his feedback, thus saving on response time and decision making. Of
course, with the increased use of the verbal communication, you can see problems like
language, social and cultural barriers and time difference in the different Eco zones
cropping up often. You have to overcome these hassles to make a meaningful and useful
message sans the least bit of confusion and complexity.

 Written Form of Communication

Several forms of communication including formal letters, posters, business memos,
bulletin boards and other diverse forms of communication form part of the written form
of communication. This is a good choice for those wanting to convey the same message
in writing to several people at different locations. They can send also technical messages
with images and charts to make it easy for the recipients to analyze and comprehend.
Another advantage of a written message is its paper trail that necessitates the recipient
to receive and acknowledge it. Such messages are also created for purposes of a record
of corrections or for legal purposes.

 Electronic Form of Communication

38
 The continuous evolution of technology has had a profound effect on the way business
communications are conducted these days, including web conferencing, email, social
networking, text messaging, chat and online organizational websites. Most companies
resort to electronic messaging to communicate quickly with multiple recipients outside
like stakeholders who can include employees, creditors, shareholders, unions, suppliers
and the community in general, at low cost. Different forms of electronic communication
are used by organizations to communicate with or send messages not only to diverse
demographic clusters, but also individuals and organizations in the international arena.

 Communication by Email
Today, e-mail takes precedence over most communication modes, for its predominantly
cheap, fast and good features, giving it an edge over others in communication with the
remotest parts of the globe, in a manner that both the sender and receiver find
convenient. Though it may appear less personal than a face-to-face meeting or even a
phone call, e-mail gives you the opportunity to send documents, pictures or videos at
the flick of a mouse, with the same credibility as faxing it or delivering by hand.

Several client based communication are based on email only. Their employees are also
treated for email- antiquates

 Social Networking Services

This is an ideal web based platform facilitating the sharing of social relations among
likeminded people with similar interests. The participants in this platform create a public
profile and a user list, share information and interact with each other on this social
network, using the e-mail and instant messaging services like Facebook,

They have their own blog called The Fern Hotels & Resorts on wordpress.
They have very active Facebook account. As most of the updates are timely available
with details.

39
 An Online Website
The Fern Residency has its online website It’s is a set of web pages served by a single web
domain. All the company information, new services or changes are timely updated there.

40
 2810004
Organizational
Behavior

41
ORGANISATIONAL STRUCTURE:

Behind every great company, division, or team is a great organizational structure - a structure
tailored to a company's, division's, or team's goals, and one that helps employees understand
how they fit into the bigger picture.
Without the proper structure in place, an organization may fail to function efficiently, or even
collapse. Poor organizational design and structure results in a bewildering morass of
contradictions: confusion within roles, a lack of coordination among functions, failure to share
ideas, and slow decision-making bring managers unnecessary complexity, stress, and conflict.

PURPOSE OF ORGANISATIONAL STRUCTURE:

 Define Division of work.
 Define tasks and responsibilities.
 Define channel of communication.
 Define roles within the organization.
There are six elements that managers need to address when they design their organization’s
structure.

1) WORK SPECIALISATION:
To what degree are activities subdivided into separate jobs?

Also known as division of labor, specialization is the degree to which activities or tasks in an
organization are broken down and divided into individual jobs.

High specialization can be beneficial for an organization, as it allows employees to become

“masters” in specific areas, increasing their productivity as a result.

However, low specialization allows for more flexibility, as employees can more easily tackle a
broader array of tasks (as opposed to being specialized for a single task)

42
For example:

The Executive chef is responsible for below mentioned activities, he needs to specialize in
managing the Jr. Chef, no other can specialize in doing his job.

The Executive chef has highly designated work - Takes care of daily food preparation and duties
assigned through the superiors to meet the standard and the quality set by the Restaurant,
Coordinates daily tasks with Junior Chef, Responsible to supervise junior chefs, Assess quality
control and adhere to hotels service standards, Have excellent knowledge into menu creation,
whilst maintaining quality and controlling costs in a volume food business.

 The Fern Hotel follows the High specialization form of work specialization. As each task
is seriously designated to particular employee of particular department.
 Efficiency gains – Payment related to skill-level required, Increase in performance in
specific task, Encouraging creation of special inventions
 Efficiency losses – Boredom, Fatigues, Stress, Poor quality, High absenteeism & turnover

43
 (SOURCE: Prentics Hall Inc.)

(2) DEPARTMENTALIZATION:

Departmentalization refers to the process of grouping jobs together in order to coordinate

common activities and tasks.

If an organization has rigid departmentalization, each department or team is highly

autonomous, and there is little (or no) interaction between different teams. In contrast, loose
departmentalization entails that teams have more freedom to interact and collaborate.

It’s worth noting that the way in which an organization departmentalizes is often used as a
proxy for the overall type of organizational structure that organization has
There are several types of organizational Structure:
1) Functional Org Structure - The functional structure departmentalizes an organization
based on common job functions i.e. the marketers together in one department, group
all of the salespeople together in a separate department, and group all of the customer
service people together in a third department.
2) Divisional: Product-Based Org Structure - A product-based divisional structure -- each
division within the organization is dedicated to a particular product line. i.e. each
division within a divisional structure can have its own marketing team, its own sales
team, and so on.
3) Divisional: Market-Based Org Structure - The divisions of an organization are based
around markets, industries, or customer types. (i.e. Commercial Division, Residential
division, Government Division)
4) Divisional: Geographical Org Structure - The geographical organizational structure
establishes its divisions based on Geography (i.e. the divisions of a geographical
structure can include territories, regions, or districts).
5) Process-Based Org Structure - Process based organizational structures are designed
around the end-to-end flow of different processes, such as "Research & Development,"

44
 "Customer Acquisition," and "Order Fulfillment." Here one process is dependent on
each other.
6) Matrix Org Structure - all employees have dual reporting relationships. Typically, there is
a functional reporting line as well as a product- based reporting line (i.e. The functional
department for all the product is same – The marketing, sales, service department team
for all services Electronics, Snacks, Home Gods remains the same ).
7) Circular Org Structure - The circular structure still relies on hierarchy, with higher-level
employees occupying the inner rings of the circle and lower-level employees occupying
the outer rings. They promote communication and the free flow of information between
different parts of the organization

Hence after looking at The Fern Hotel‘s departmentalization conclude that it has
Functional Organizational Structure.

(3) The Chain of Command:

One of the most basic elements of an organizational structure, chain of command is exactly
what it sounds like: an unbroken line of authority that extends from the top of the organization
(e.g. a CEO) all the way down to the bottom. Chain of command clarifies who reports to whom
within the organization.
Large Chain of command has several levels of authorities involved. The Short chain of Command
has less number of higher authorities involved.
The FERN hotel has Short chain of Command as there is General Manager, Executive assistant
manager and then all the Specialists of particular Department.
The Organizational Structure at Fern is such that the subordinates in each department take
orders from the manager of that particular department, likewise general Managers have
authority over managers of each department.

(4) Span of Control:

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Span of control refers to the number of subordinates a superior can effectively manage. The
higher the ratio of subordinates to superiors, the wider the span of control.
Wide Span of control has many subordinates under one supervisor. Narrow Span of Control has
fewer subordinates.
The Fern hotel has Wide Span of Control, as it has highly specialized Org Structure with
Functional Departmentalization, the number of subordinates increased by default.

(5)Centralization / Decentralization:
Who makes the decisions in an organization?
If decision-making power is concentrated at a single point, the organizational structure is
centralized. If decision-making power is spread out, the structure is decentralized.
The Fern has a Centralized Structure. The decisions are generally taken by the General
Manager. This leads to little opportunity for the subordinates to make their own decision
leading to lack of motivation. Despite of this the Fern prevents the strict control of power by
having some amount of decentralization within the structure.
While a decentralized structure promotes a more democratic decision-making process, it can
also slow down the decision-making process, making it harder for organizations to operate
efficiently.
(6) Formalization:
Formalization deals with the how jobs are structured within an organization. A formal
organizational structure seeks to separate the individual from the role or position, as the role or
position stays the same regardless of who’s holding it. An informal organization, on the other
hand, places more value on the individual. It allows for the evolution of a role or position based
on an individual’s preferences, skill set, etc., and places less importance on what team or
department that individual is part of.
The Fern follows a bureaucratic approach to the system, that is has a Formal Organizational
Structure, this involves following rules and procedures. The job descriptions are very closely
defined with little flexibility. Such type of structure is unable to change and meet new demands.

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2810005
47
 Principles of
Management

Basically a hospitality related firm has its main focus in entertainment and reception of guests,
visitors, and others with liberality and good will. The functions of management as stated by Henri
Fayol according to their applications in The Fern hotel are stated in the following clauses:

PLANNING :

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Planning in hotel sector is the conscious determination of future course of action.
This involves why in action? How to take action? And when to take action? Management has to
decide what they are going to do in mere future for the well-being and growth of the
organization. What sort of goals will fetch their organization the best results?
Management has to envision the position of the organization in the future and implement their
plans and policies in the similar manner to get the best out of it. Planning is an ongoing step and
can be highly specialized based on the organizational, divisional, departmental, team’s goals.
How do they implement it:
 In Fern, before launch of any new service market survey is done.
 They build up strategic plan which guides the long-term operations of the hotel
 The strategies are planned in such a manner that minimizes the operational costs and at
the same time ensures that their quality is maintained.
 Management plans the activities of the organization as they have to take account of what
is necessary with the appropriate prevailing conditions.
 The company’s marketing strategies are based on customer experience and quality of the
service in order to improve its image

ORGANIZING:
It is the basic implementation phase of management wherein they have to make optimum usage
of the resources required to enable the successful carrying out of plans.
Organizing involves integrating, and co - coordinating task, goals and missions along with the
resources to attain specific objectives. In hospitality industry organizing is the one of the crucial
function of the organization.
Management has to take care whether everything is under control and properly functioned or
not. Organizing requires determining how to distribute resources and organize the employees
according to the plan. Management has to identify different roles and ensure that they assign
the right amount of employees to carry out the plan. They also need to delegate authority,
assign work, and provide direction properly.

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How do they implement it:
 All the activities are divided into tasks of small groups with one leader or professional
expert.
 The coordination between all the small units is ensured for the smooth execution of the
plan.
 Most of the purchasing activities are maintained and managed centrally to ensure the
uniformity and minimize the cost.
 The whole structure coordinates and motivates employees so that they work together to
achieve goals. At the end if each works with the same efforts and motivation level the
execution of the plan will be in a organized and systematic manner.

STAFFING:
Staffing is one of the most important aspects for the development of all types of organization.
Hospitality sector has a very major influence from the employees of the organization. It is the
respect and courtesy which leads and booms the hospitality sector, which comes directly from
the individual skills and approach towards their guests. More and more hotels have noticed and
realized that a good staffing plan could increase their
Good will in the market which is the major thing required for uplifting the name and fame of the
organization. Good staffing could be able to minimize cost in order to maximize profit and reduce
chaos.
Management must ensure that the one going to be recruited is properly skilled for hotel sector
and has a nice human behavioral approach
How do they implement it:
 Service industry is all about working with the people for the people, so better staffing
leads to happier people
 The Fern hires highly qualified and talented employees that add value to their hotel.
 The Fern’s executives including staff at Housekeeping, sales, marketing, Front office ,
Food and Beverages departments are selected after through a competitive process.

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  Each individual has to meet the department’s manager and also the General Manager
before getting hired.

DIRECTING:
Directing is said to be the heart of management functions. All other functions have got no
importance if direction doesn’t take place properly. Directing initiates action at this is the actual
phase from where actual work starts.
Directing comprises of providing proper guidance to employees and encourages them to work
effectively and efficiently. Hotel sector has to follow directing function very properly because
that’s how they will be able to show their kind of hospitality to the guests.
Mistake of an employee may spoil the image of the organization, so they must be trained well
enough to compete with the challenges they’ll be facing in mere future
How do they implement it:
 Team work is highly encouraged across all hierarchical levels and all the members of staff
are given opportunity to participate in decision making.
 Through weekly departmental meetings its ensured that everyone is directed and guided
about their tasks in prior.
 Several employee training and recognition programs help them direct and motivate in
proper direction for their individual growth will lead to companies growth.

CONTRLOLLING:
Controlling consists of verifying whether everything occurs in conformities with the plan
adopted, instructions issued and principles established.
This function ensures that there isefficient and effective utilization of organizational resources so
as to accomplish organization’s plans. Hotel sector needs this function majorly to establish
standards. A good scale of thinking process must be kept in order to compare what is going on
and what was planned.
There must be measurement of performance wherein the deviations from the pre-determined
goals should be judged and a proper remedial action must be taken to fill that gap.

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How do they implement it:
 The various performance management report s are made. The Quarterly performance
data include productivity, Efficiency, Utilization, Communication, Attitude, Team Work,
Attendance, Leadership skills.
 The measurement helps in controlling the overall performance of the employee,
quarterly, monthly, weekly, daily goals are set up.
 Each department has a designated Manager / Lead who looks after the Quality of his /
her respective department.

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 2810006
Research
Methodology

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Research :

A research is conducted to prove or disprove a hypothesis or to learn new facts about

something. Any industry before investing its money into some new venture would want to
know the pros and cons of the business.
In the same manner The Fern Hotel conducted its research to know the customer satisfaction
level. A service industry is all about taking care of its Customer through and through. They
conduct frequent researches consulting with Marketing Research companies This helps them
bring required changes for better growth.
One of the very basic and open Researches that were conducted once for their internal
activities is described below.

FORMULATING THE RESEARCH PROBLEM

The first step in research is formulating a research a research problem. It is rightly said
that, “a problem well defined is half-solved.”
THE RESEARCH PROBLEM: Research on Customer Satisfaction of customers who visited Fern at
least once between the months of November 2014 – December August 2014.
UNITS OF ANALYSIS: The individuals who visited The Fern hotel at least once for Dinning,
Staying or for attending any function were taken into account.
TIME AND SPACE BOUNDRIES:The November and December month of the year were chosen, as
this month includes all types of customer, for Weddings, for Parties and conferences, for New
Year and Christmas celebration etc.
CHARACTERISTICS OF INTEREST: There were several characteristics of interest that The Hotel
Fern Rajkot was looking for, as it was their first venture in Rajkot as a Hotel industry, they
wanted to know the type of market, food preferences and the choice of market after one year
of its existence.
ENVIRONMENTAL CONDITIONS: They choose their own premises for conducting the research,
as they will get genuine and interested set of people who can help answer the research
question based upon their recent experience. The response will remain unalloyed.

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COLLECTION OF PRIAMARY DATA: Structured method and direct method of data collection
was chosen. This was chosen to get response on systematic and identical questions
QUESTIONNAIRE: The questionnaire is attached in the Annexure.
Based on the few data’s disclosed by them below Analysis was concluded:

(1) MALE – FEMALE RATIO:

GENDER RESPONDENTS
MALE 61
FEMALE 39
TOTAL 100

RESPONDENTS
R E S P ON D E N T S

80
N O. OF .

60
40
20
0
MALE FEMALE
GENDER

INTERPRETATION: Mostly main visitors of hotel Fern are male because Rajkot is industry
oriented rather than any tourist spot. So research shows that its main visitors are professionals.
Thus, comparatively number of male is more than female visiting Fern.

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 (2) OCCUPATION OF THE CONSUMER

OCCUPATION RESPONSE
Business 24
Student 16
Profession 30
Service 21
House wife 09
TOTAL 100

RESPONSE

40
RESPONSE

30
NO. OF

20
10
0
Business Student Profession Service House wife
OCCUPATION

INTERPRETATION:The research shows that all kind of people visit The Fern almost equally
except house wives. One of the reasons can be that it’s not situated quitein the center of the
city. If The Fern considers that the house wives are important customer for their growth, then
they should plan activities and services attracting them.

ATTITUDE & BEHAVIOUR OF STAFF MEMBERS &WAITERS :

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 ATTITUDE & BEHAVIOUR RESPONSE
Excellent 25
Very good 34
Good 30
Poor 11
TOTAL 100

RESPONSE
CO NS UM E R
RE S P O NS E

40
30
20
10
0
Excellent Very good Good Poor
BEHAVIOUR OF STAFF

INTERPRETATION: According to the data we can conclude that the staff and waiters are totally
dedicated to their work. The result of “poor” needs does need attention and it cannot be
ignored. Even a small set of customer should never consider ‘bad service’ as one of the reason
for not visiting The Fern again. Providing good service is the basic requirement in any hospitality
sector.
The above are few of the data that were disclosed.

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58
 2810007
Quantative
Analysis

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The word statistics comes from the Latin word Statusor Italian word Statista or German word
Statistik.Each means ‘an organized political state’

Definitionsof Statistics defined by Bowley: ‘Statistics are numerical statement of facts in any
department of enquiry placed in relation to other.

Measure of Central Tendency:

The statistical measures which tell us the location of central value or central point to describe
central tendency of the entire mass of data it’s known as measure of central tendency.

1) Arithmetic Mean : X͞ = Sum of all observations / Number of observations

= ∑X / N

Doing the analysis of the cost of average room at the Fern:

The three types of Room have cost as below:

 Fern Club Room = Rs 4500 / Day

 Hazel Suite = Rs 3000 / Day
 Wintergreen Room = Rs 2500 / Day

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Type of Room No of guests / room Frequency
Fern Club room – 4500 2 9000

Hazel suite room – 3000 3 9000

Wintergreen room – 2500 4 10000

Total ∑F = 9 ∑Fx = 28000

Arithmetic mean (average revenue)= ∑Fx / ∑F

= 28000 / 9
= Rs3111

2) Median- If N values are arranged in ascending or descending order of magnitude, and

then the middle value is called the median.

Cumulative frequency:
Type of Room No of guests / room Cumulative Frequency
Fern Club room – 4500 2 2

Hazel suite room – 3000 3 5

Wintergreen room – 2500 4 9

Total ∑F = 9

Median = (N+1) / 2

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For above example the prices are arranged in ascending order, so the Median price is
(9+1)/2
= 5thValue
= Rs 3000 (Hazel Suite room)

3) Mode – Mode is defined as the value that is occurring the most frequently in a series.
So from above chart we can see that the most frequently occupied room is Wintergreen room
as its frequency is highest i.e. 4.

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CONCLUSION

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Whether it is a service or a manufacturing industry, the principles and basic concepts of
management are applicable everywhere.

By preparing this project I got an overview of how the Hotel Industry works as a whole. The
departments, the services, the organizational structure, implementation of financial data,
research work and analysis of raw data.

The various aspects of the subjects became clearer by preparing this project.

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