Executive summary
Good service is dependent on the selection and management of employees, as well as the process of creation and educating of standards. Sustainable advantage in the service industry in the Four Seasons Hotels and Resorts has been attributed to delivery of efficient personal service, which is a difficult but rewarding process.
Personal service has emerged as the single most vital value proposition due to the convergence for various trends over the years, including rapid change and increasing affluence. Increasing wealth is a contributing factor since the higher purchasing power removes barriers of opportunity and happiness, though time cannot be bought, and this necessitates the need for leisure at every opportunity that presents itself.
When selecting a luxury hotel, there are various factors that are considered including: impeccable service; welcoming atmosphere; provision of exceptional service in catering for individual needs; an overall enjoyable hotel experience; and an experience that leaves one feeling rejuvenated.
Four seasons have adapted to using social networks to keep in touch with their guests, and other people interested in their services, especially through a fan page in their facebook account. They keep their fans updated on events happening in the hotel and resort by posting pictures of wedding couples and information on new offers, deals and packages.
The facebook updates have been observed to be quite helpful to the fans, who obtain information regarding the various services offered, when the married couples comment on the service.
Four Seasons has been able to retain high revenue per available room (RevPAR) while competing on a service basis that is motivated by values and focus. This is because Four Seasons specializes in luxury hospitality, which has enabled them to acquire a deep understanding of what pleases the guests most.
Introduction
Four Seasons Hotels and Resort was founded in 1961. Its primary focus since it began its activities has been the provision of exceptional personal service, making this its distinguishing competitive advantage. Their focus on personal service has been based on the need for highly reliable and satisfying service for the affluent travellers. According to Sturman (2006), service differs from physical assets in that service is a “product of people, systems and culture, which are dynamic and created over longer periods of time”.
Good service is dependent on the selection and management of employees, as well as the process of creation and educating of standards. Four Seasons Hotels and Resort management believes that service is an “investment in the quality of staff and guest experience, which has led to the consistent profits, reputation and growth” (Carvell & Quan, 2005).
Sustainable advantage in the service industry has been attributed to delivery of efficient personal service, which is a difficult but rewarding process. It is this highly personalized service that has earned Four Seasons its reputation as the “world’s leading operator of luxury class hotels and resorts”.
Background
Four Seasons Hotels and Resorts focused on perfection of their services, together with top-notch facilities and operations. When the Hotel was started, their focus was on the affluent traveller, a small segment of the market. In order for them to appeal to this market they had to focus on luxury, and their success was obvious from their high profits, increased reputation and fast growth.
Their success has been attributed to employee selection, whereby their staffs is innovative on developing standards that are meaningful and flexible, and are capable of upholding a unique culture that makes delivery of those standards (Canina & Enz, 2006).
The Focus on Personal Service
According to Sherwyn (2006), true competitive advantage is the “ability to deliver distinctive benefits for which customers will pay more over time, because those benefits are highly valuable and difficult to imitate”.
This definition fits in well with the operations of Four Seasons Hotels, whereby they focus on the pressured lifestyles of their affluent customers, providing exceptional personal service, while still focusing on innovations in hotel design and style, technology and personal amenities. Sherwyn (2006) believes that “any company can outperform its rivals only if it can establish a difference that it can preserve”.
He acknowledges that competitors can quickly imitate management techniques and new technologies and improve on them, though emerging as the best requires one to either perform activities in a different manner, or perform other different activities altogether (Sherwyn, 2006).
Personal service has emerged as the single most vital value proposition due to the convergence for various trends over the years, including rapid change and increasing affluence. Increasing wealth is a contributing factor since the higher purchasing power removes barriers of opportunity and happiness, though time cannot be bought, and this necessitates the need for leisure at every opportunity that presents itself (Corgel, 2005).
When selecting a luxury hotel, there are various factors that are considered including: impeccable service; welcoming atmosphere; provision of exceptional service in catering for individual needs; an overall enjoyable hotel experience; and an experience that leaves one feeling rejuvenated.
A survey conducted by Four Seasons showed that time was a key factor in choosing a luxury hotel, since a lot of their time was consumed in work, with people having minimal time for fun, and therefore maximizing on the opportunities (Corgel, 2005).
The issues and innovations at Four Seasons
Four seasons has been known to have innovative personnel, introducing new trends that appeal to their customers that are then borrowed by their competitors, such as the introduction of individual bottles of shampoo and high-quality mattresses.
Personal service is a key factor in Four Seasons Hotels and Resorts, though advancements in technology have increased opportunities in both expansion of business and delivery of personal needs to their customers. The opportunities available in the web are diverse, and their introduction of a website was met with new challenges, raising the concerns of either increasing their revenue or reducing their costs (Sturman, 2006).
The focus of Four Seasons on technology saw the introduction of energy management systems in every guest room to control lighting and air conditioning. This was suitable in providing the clients with the opportunity to save without compromising their comfort. Another provision towards personal technology was the introduction of ergonomically designed desks that allowed their guests to comfortably use their laptops.
Another innovation to meet the request of their guests was the installation of plugs and data ports on the desks, to prevent their guests from crawling under the desks to plug in their devices and gadgets (Hinkin & Tracey, 2006).
The use of Technology at Four Seasons
Four seasons have adapted to using social networks to keep in touch with their guests, and other people interested in their services, especially through a fan page in their facebook account. They keep their fans updated on events happening in the hotel and resort by posting pictures of wedding couples and information on new offers, deals and packages (Carroll, Gomez, Huen, Lanier, & Lui, 2006).
The facebook updates have been observed to be quite helpful to the fans, who obtain information regarding the various services offered, when the married couples comment on the service. The fans can also communicate with each other regarding various offers in interested fields, such wedding supplies.
The marketing team for Four Seasons has made use of the facebook page to provide a platform for making bookings and purchasing gift vouchers (Wagner, Piccoli, & Louthen, 2005).
The adoption of voicemail at Four Seasons as opposed to leaving messages or diverting calls was a rewarding idea, as it allowed the guests to leave messages in a language of their choosing. Another idea that Four Seasons uses to show warmth to their guests is a hand-written welcoming note, accompanied by a gift.
The management is opposed to use of typewritten notes, since they are mass produced, and they do not show that the guests are really appreciated. The management also uses emails to maintain open communication with their guests. In addition to this, any messages communicated to guests or colleagues in their other properties are followed up with phone calls to check up on their well being (Pullman & Robson, 2006).
The Four Seasons chain makes use of intranet to deliver budget information to each of its property, providing both the initial documents as well as other documents containing amendments that are beneficial in making prudent and informed decisions (Pullman & Robson, 2006).
Four Seasons has extended use of technology to meet the needs of their guests. This can be seen by the introduction of telephone lines in the guest rooms; two telephone line, one fax and one data port. In addition to this, the hotel was the first to create a database for their guests’ preferences, in all their hotels.
The system was later developed to facilitate sharing of guest information across the chain of properties to avoid redundancy through repetition. The use of a central system however, had its challenges, especially when the guests used different names and initials of their names, making it difficult to identify them.
An algorithm was developed to overcome the inconsistencies of booking under different names. This algorithm used points to match guest profiles of new guests and old guests whose profiles are already in the database (Canina & Enz, Revenue Management in U.S. Hotels: 2001–2005, 2006).
The websites for Four Seasons provides a lot of information regarding their properties, which is something that other hotels do not focus on. These websites allow visitors to acquire detailed information, both pictures and written, and also make inquiries on any property of their liking.
Some of the information provided in the websites regarding the properties includes: square footage; decor; colour scheme; bathroom and a view of the room. The website has links for the key words, in case the visitors would like to know more, and the ability to zoom in for a better view of the images.
Information about room categories and price ranges is contained in a section of the website referred to as packages, nicely arranged in order of price (Piccoli & Torchio, 2006).
Reservations could be made via the Four Seasons website as from the year 1999, with the first year generating U.S $ 1.4 million in revenue. The introduction of a toll free telephone number on the website led to an increase in the number of reservations made via the telephone, leading to increased bookings constituting about 25% of the revenue generated.
Customized tours for clients were provided through mini-sites, located in the intranet. These mini-sites contained information for specific property that a particular client was interested in. The clients adapted to the mini-sites quite fast, which necessitated the IT department to educate the property managers on creating and maintain their own mini-sites, in order to keep up with the demands of their clients (Noone & Kimes, 2005).
The site for Four Seasons is well sectioned to offer convenient manoeuvrability for the visitor. The home page provides links that take the visitor direct to the information they are seeking, like planning a vacation, meeting or a wedding. Each category then offers about ten pictures from various angles to display the layout of the room or property.
Subsidiary information is also provided based on the category chosen, as in, visitors are provided with information on catering and banquet spaces in the wedding category. Another technological advancement that is appealing to online visitors is the presentation of specific offers to certain visitors, by tracking their frequently accessed pages, in order to know their preferences.
The visitors are also provided with the option of subscribing for alerts, whenever there are special offers in particular categories (Lynn, 2006).
Conclusion
There are many luxury hotels, though Four Seasons has been able to retain its guests and increase their number by ensuring that the personal service is distinctive and memorable. Four Seasons has been able to retain high revenue per available room (RevPAR) while competing on a service basis that is motivated by values and focus. This is because Four Seasons specializes in luxury hospitality, which has enabled them to acquire a deep understanding of what pleases the guests most.
Four Seasons has cultivated rules over the years, and these have shaped the system of standards, people and culture, allowing them to meet well-understood needs. This understanding has been highly appreciated by the guests, while the staff remains motivated by their competitive wages and benefits. The chart below compares the RevPAR of Four Seasons to that of other luxury hotels including Ritz-Carlton (Carvell & Quan, 2005).
Figure 1: Quarterly financial releases for Four Seasons and other Luxury properties
Continued innovation in personal service is important for guests and difficult for other luxury hotels to imitate. An example was the introduction of family packages by Four Seasons, which allowed grandparents to travel with their grandchildren and other members of the extended family.
The services at Four Seasons are also tailored to cater for teenagers and toddlers through the provision of particular amenities, since children are also guests with their own particular needs.
The provision that allows people travelling together to share activities such as travelling, restaurant dining and outdoor fun sports is highly appreciated by the guests. It is this keen interest in the welfare and comfort of all the guests regardless of their age that keeps Four Seasons at the top of luxury hotels (Carroll & Siguaw, 2006).
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