Hospitality Management

Hotel products and services designed to attract guests. Examples include Internet
access and copying services, in-room hair dryers, irons, ironing boards, and microwave ovens, as
well as indoor pools, exercise rooms, and in-room movies
Average Daily Rate (ADR)
The average (mean) selling price of all guest rooms in a hotel, city, or country for a specific period of time
Bed and breakfast inns
Very small properties (one to several guest rooms) owned or managed
by persons living on-site; these businesses typically offer one meal a day; also called B&B
Camps/park lodges
Sleeping facilities in national, state, or other parks and recreational areas
that accommodate visitors to these areas
A business operation that offers table and card games along with (usually) slot
operations and other games of skill or chance and amenities that are marketed to customers seeking gaming activities and entertainment. Many casinos offer lodging accommodations for
their visitors
A form of transportation rented exclusively for a specific group of travelers. Planes and buses are often chartered for group travel
Conference center
A specialized hospitality operation specifically designed for and dedicated
to the needs of small-and medium-sized meetings of 20 to 100 people
Convention hotel
A lodging property with extensive and flexible meeting and exhibition spaces that markets to associations, corporations, and other groups bringing people together for
Cruise ship
A passenger vessel designed to provide leisure experiences for people on vacation
at sea
Extended-stay hotels
A moderately priced, limited-service hotel marketing to guests desiring accommodation for extended time periods (generally one week or longer)
Full-service hotel
A lodging facility that offers complete food and beverage services
Global Distributi
on System (GDS)
Commonly referred to as the GDS, this computer system connects travel professionals worldwide for the purpose of reserving hotel rooms for their
The amount of profit made from room sales divided by the number of rooms available to sell
Gross operating profit
The amount of revenue generated in a defined time period minus its management controllable expenses for that same period
Guided tour
A group tour package that includes the services of one or more tour guides
Hospitality industry
Organizations that provide lodging accommodations and food services for
people when they are away from home
Hotel shuttle
A vehicle used by a hotel to transport guests to and from such destinations as airports, restaurants, and shopping
An establishment that provides sleeping rooms as well as various services to the traveling
The owner/manager of one or more hotels
Typically, a big-city airport within a short driving distance of a very large population center. These mega-airports are used to economically connect travelers with flights to their desired departure and arrival cities
Limited-service hotel
A lodging facility that offers no, or very restricted, food and beverage services. Also known as a
“select-service hotel.”
Lodging industry
All the businesses that provide overnight accommodations for guests
The potential customers for a business’s products and services
Occupancy rate
The ratio of guest rooms sold (or given away) to the number of guest rooms available for sale in a given time period and expressed as a percentage
Online travel agent (OTA)
An organization that provides travel booking services on the Internet
A group of travel services, such as hotel rooms, meals, and airfare, sold for one price.
For example, a Valentine’s Day Getaway package to Las Vegas suggested by a travel agent might include airfare, lodging, meals, and show tickets for two people
at an all-inclusive price
Private clubs
Membership organizations not open to the public that exist for people enjoying common interests. Examples include country (golf) clubs, city clubs, university clubs, yacht clubs, and military clubs. Some private
clubs offer sleeping rooms for members and guests.
Professional development
The process by which hoteliers continue to improve their knowledge
and skills.
A full-service hotel with additional attractions that make it a primary destination for travelers
The average revenue generated by each guest room available during a specific time period. RevPAR combines the information from ADR and occupancy rate into a single measure
Room service
The delivery of food and beverages to a hotel guest’s sleeping room
A lodging property that sells its rooms to guests for use during a specific time period each year; also called vacation ownership property
Tour operator
A company or individual who plans and markets travel packages
A person who travels for pleasure
Trade shows
An industry-specific event that allows suppliers to an industry to interact with, educate, and sell to individuals who are part of the industry; also called an exhibition
Travel agent
A professional who assists clients in planning and purchasing travel
Value (lodging accommodations)
The price paid to rent a room relative to the quality of the room and services received
Those who sell products and services to hoteliers
Career fair
Trade show-type events that allow prospective job applicants to meet recruiters representing multiple employers in one location during a specified time period
Code of Ethics
A statement adopted by an organization that outlines policies developed to guide the making of ethical decisions
Cross-cultural adaptability
The extent to which a person can adjust (adapt) to another culture
Culture shock
The feeling of disorientation, confusion, and changes in emotions created when one visits or lives in a different culture
Distance learning courses
Formal education (training) programs that are available to students/trainees in remote locations
A person who assumes the risk of owning and operating a business in exchange for the financial and other rewards it may produce
A person’s beliefs about what is right or wrong
Exchange rate
The rate at which the money of one country is traded (exchanged) for the money of another country
A citizen of one country who is employed in another country. Example: a United States citizen working in Asia would be considered an expatriate by his/her Asian counterparts
Between disciplines—involving several domains of knowledge; for example, basic business principles can be applied in organizations in many industries
A person employed by an organization whose compensation is based, at least in part, upon the financial success of the unit for which he/she has responsibility
Job enlargement
The act of including additional tasks/assignments in one’s position to provide more opportunities to learn how the position relates to others
Job rotation
A systematic plan to move employees into different positions so that they acquire the knowledge/skills required to be effective in these positions
National culture
The values/attitudes shared by citizens of a specific country that impact their behavior and shape their beliefs about what is important
Promote From Within
The concept that a company offers higher-level positions to its existing employees before seeking external candidates when these positions must be filled
Residential education programs
Formal education (training) programs that are available to students/trainees at a specific geographic location
Employees whose work is directly supervised or controlled by an individual of higher rank or position
The increase, over time, in the value of an asset. The amount of the increased value is not taxed unless the asset changes hands (is sold)
Asian American Hotel Owners Association (AAHOA)
Association of hotel owners who, through an exchange of ideas, seek to promote professionalism and excellence in hotel ownership
The name of a specific hotel group. For example, Holiday Inn and Comfort Inn are two different brands. Additional examples of brands include Hyatt, Hampton Inn, Super 8, and
Brand Standard
A hotel service or feature that must be offered by any property entering or remaining in a specific hotel brand. Used, for example, in: “The franchisor has determined that free wireless Internet access in all guest rooms will become a new brand standard effective on January 1st next year.”
An arrangement in which both parties to a contract agree to end the contract early as a result of one party paying the other the agreed-upon financial compensation
The hotels operated by a group of franchisees who have all franchised the same hotel brand name. Also called a “brand” or “flag.”
The changing of a hotel from one brand to another. Also known as “re-flagging.”
The reduction in the value of an asset as it wears out. This non-cash expense is often termed a “tax write-off” because the decline in the value of the asset is tax deductible
Depressed market
A hotel market area where occupancy rates and/or ADRs are significantly below their historical levels
Federal Trade Commission (FTC)
Government agency that enforces federal antitrust and consumer protection laws. It also seeks to ensure that the nation’s business markets function competitively and are free of undue restrictions caused by acts or practices that are unfair or deceptive
First tier (management company)
Management companies that operate hotels for owners using the management company’s trade name as the hotel brand. Hyatt, Hilton, and Sheraton are examples
Franchise agreement
A legal contract between a hotel’s owners (the franchisee) and the brand managers (the franchisor) that describes the duties and responsibilities of each in the franchise relationship
Franchise Offering Circular (FOC)
Franchise disclosure document prepared by a franchisor and registered and filed with the state governmental agency responsible for administering franchise relationships
Franchise Services Director (FSD)
the representative of a franchise brand who interacts directly with a hotel franchisee. Different brands may title this important position somewhat differently, but each will have a comparable position
An arrangement whereby one party (the franchisor) allows another party to use its logo, brand name, systems, and resources in exchange for a fee
An individual or company that buys, under specific terms and conditions, the right to use a brand name for a fixed period of time and at an agreed-upon price
An organization that manages a brand and sells the right to use the brand name
General Manager (GM)
The traditional title of the individual at a hotel property who is responsible for final decision-making regarding property-specific operating policies and procedures. Also, the leader of the hotel’s management team
Legally bound to compensate for injury or loss
Management company
An organization that operates a hotel for a fee. Sometimes called a “contract company.”
Management contract
An agreement between a hotel’s owners and a hotel management company under which, for a fee, the management company operates the hotel. Also sometimes called a “management agreement,” or an “operating agreement.”
Market share
The percentage of a total market (typically measured in dollars spent) captured by a property. For example, a hotel generating $200,000 in guest room rental in a market where travelers spend $1,000,000 per year would have a 20 percent market share ($200,000/$1,000,000 = 20%)
A hotel investor who also manages (operates) the hotel
The money remaining after all the expenses of operating a business have been paid
The taking back of a property by a seller or lender, usually in response to nonpayment by the buyer
Return on investment
The percentage rate of financial return achieved on the money invested in a hotel property
Second tier (management company)
Management companies that operate hotels for owners and do not use the management company name as part of the hotel name. American General Hospitality, Summit Hotel Management, and Winegardner and Hammons are examples
The term used to describe a characteristic of all hotels within a single brand. Used, for example, in: “Last year, the system-wide ADR for our brand was $99.50.”
An obligation created when a person is delegated duties/responsibilities by higher levels of management
The search for best practices and an understanding about how they are achieved in efforts to determine how well a hospitality organization is doing
A commonly available and most often unspecialized product
Continuous Quality Improvement (CQI)
Ongoing efforts within a hospitality operation to better meet (or exceed) guest expectations and to define ways to perform work with better, less costly, and faster methods
Cross-functional teams
A group of employees from each department within the hospitality operation who work together to resolve operating problems
Employee-to-guest ratio
The number of employees relative to the number of guests. In the lodging industry, this is typically expressed in terms of employees per room; a 500-room luxury, full-service property may have 500 employees: a 1:1 employee-to-guest ratio. A 100-room limited-service property may have 25 employees: a 1:4 employee-to-guest ratio
Employer of choice
The concept that the hospitality operation is a preferred place of employment in the community for applicants who have alternative employment opportunities
The act of granting authority to employees to make key decisions within their areas of responsibility
Formal authorization to practice a profession that is granted by a governmental agency
Malcolm-Baldridge National Quality Award
Award granted to U.S. businesses that
demonstrate successful quality-related strategies relating to leadership, information/analysis, strategic planning, human resource development/management, process management, business results, and customer focus/satisfaction
A staff member who directs the work of supervisors
Mission Statement
A planning tool that broadly identifies what a hospitality operation would like to accomplish and how it will accomplish it
Moments of Truth
Any (and every) time a guest has an opportunity to form an impression about the hospitality organization. Moments of truth can be positive or negative
People working in an occupation that requires extensive knowledge and skills in a specialized body of knowledge
The consistent delivery of products and services according to expected standards
Acceptance for one to work within a profession that is (typically) granted by a nongovernmental agency such as an association
Repeat business
Guests who return to the property for additional visits after their first visit
Service (guest)
The process of helping guests by addressing their wants and needs with respect and dignity and in a timely manner
A staff member who directs the work of line-level (non-supervisory) employees
Turnover rate
A measure of the proportion of a work force that is replaced during a designated time period (month, quarter, or year). It can be calculated as
Number of Employees Separated
( ÷ ) Number of Employees in the Workforce = Turnover Rate
The relationship between price paid and the quality of the products and services received
Word of Mouth Advertising
The favorable or unfavorable comments made when previous guests of a hospitality operation tell others about their experiences
Wow Factor
The feeling guests have when they experience an unanticipated and positive “extra” as they interact with a hospitality operation
Zero defects
A goal of no guest-related complaints established when guest service processes
are implemented
The power or right to direct the activities of others and to enforce compliance
Short for “complimentary” or “no-charge” for products or services. Rooms, food, beverages, or other services may be given to guests by management if, in their opinion, the “comp” is in the best interests of the hotel. The term can be used either as an adjective (e.g., “I gave them a comp room”) or a verb (as in “I told the front desk agent to comp the room”)
The process of comparing actual results to planned results and taking corrective action as needed
Direct bill
A financial arrangement whereby a guest is allowed to purchase hotel services and products on credit terms
The process of supervising staff members in the workplace
The furniture, fixtures, and equipment used by a hotel to service its guests
Line of Authority
A direct superior-subordinate relationship in which one person (the superior) is completely responsible for directing and exercising control over the actions of another (the subordinate)
Employees whose jobs are nonsupervisory. These are typically positions where the employee is paid a per-hour wage (not a salary) and performs a recurring and specific task for
the hotel. Sometimes referred to as an “hourly” employee
Long-range goals
Goals that are to be achieved over an extended period (usually longer than one year). Sometimes called “long-term goals.”
The coordination of individual efforts to achieve established goals
To serve as a personal teacher. Also known as a guide or coach
Organizational chart
A visual portrayal of the jobs and positions of authority within an organization
Actions designed to bring together and arrange the resources of a group to help it achieve its goals
The process of considering the future and establishing goals for an organization
Quality Inspection Scores
Sometimes called Quality Assurance (QA) scores, these scores are the result of annual (or more frequent) inspections conducted by a franchise company to ensure that franchisor-mandated standards are being met by the franchisee. In some cases, management
companies or the property itself may also establish internal inspection systems. In general,
however, it is the franchise company’s quality inspection score that is used as a measure of the
effectiveness of the general manager, the hotel’s management team, and the owner’s financial
commitment to the property
Regional Manager
The individual responsible for the operation of multiple hotels in a designated geographic area. In some companies, the person’s title may be area or district manager
Role model
An individual who displays positive personal and professional characteristics that others find desirable
Short-range goals
Goals that are to be achieved in the very near future (usually less than one year). Sometimes called “short-term goals.”
At-will employment
The employment relationship that exists when employers can hire any employee they choose and dismiss an employee with or without cause at any time. Employees can also elect to work for the employer or to terminate the relationship anytime they desire to do so
Autocratic leadership style
Leadership approach that emphasizes a “do it my way or else!” philosophy
Body language
The concept that one communicates by the way one’s arms, hands, and/or legs are positioned during a conversation or presentation
Bonafide occupational qualifications (BOQs)
The skills and knowledge to perform a job that
are necessary to safely and adequately perform all the tasks required by the job
Bureaucratic leadership style
Leadership approach that emphasizes a “do it by the book” philosophy
Career ladder
A plan that details successively more responsible positions within an organization or an industry. Career ladders allow one to plan and schedule developmental activities necessary to assume more responsible positions
Democratic leadership style
Leadership approach that emphasizes a “let’s work together and determine the best way to do it” philosophy
Corrective actions designed to encourage employees to follow established policies,
rules, and regulations
The range of differences in attitudes, values, and behaviors of employees relative to gender, race, age, ethnicity, physical ability, and other personal characteristics
Employee handbook
Written policies and procedures related to employment at the hotel, sometimes called an “employee manual.”
Entry-level employees
Staff members working in positions that require little previous experience and who do not direct the work of other staff members. Sometimes called “hourly” employees
External recruiting
Tactics designed to attract persons who are not current hotel employees for
vacant positions at a property
Health hazard
Aspects of the workplace that can lead to a decline in an employee’s health. Examples include stressful working conditions and exposure to toxic chemicals
Human resources (department)
The functional area in a hotel with the responsibility to assist managers in other departments with employee-related concerns. Also known as “HR.”
Internal recruiting
Tactics to identify and attract staff members who are currently employed at the hotel for vacancies that represent promotions or transfers to other positions
Job description
A list of tasks that an employee working in a specific position must be able to effectively perform
Job specification
A list of personal qualities or characteristics necessary for successful job performance
Job task
An activity that an employee working in a specific position must know how and be able to do. For example, a front office agent in a hotel must be able to properly check in an
arriving guest
Laissez-faire leadership style
Leadership approach that emphasizes a “do it the way you feel it can best be done” approach
Accomplishing goals by working with others while gaining their respect, loyalty, and enthusiastic cooperation
Minimum wage
The lowest amount of compensation that an employer may pay to an employee
covered by the FLSA or applicable state law. Most hotel employees are covered by minimum
wage provisions; however, exceptions can
include youthful employees being paid a training
wage for the first 90 days of employment and tipped employees (if reported tips plus wages
received at least equal the minimum wage)
An internal force that drives employees to do something to reach a goal
The process of providing basic information about the hotel that must be known by all of its employees
The number of hours of work after which an employee must receive a pay premium
(generally one and one-half times the normal hourly rate)
Participative management
A leadership style that emphasizes seeking out and considering group input before making decisions that affect the group
Performance appraisal
A periodic formal evaluation of an employee’s job performance, including a discussion of professional development goals, also called “performance evaluation.”
Progressive disciplinary program
A carefully planned series of corrective actions, each increasing in its severity and designed to encourage employees to follow established policies, rules, and regulations
Activities designed to attract qualified applicants for the hotel’s vacant management and non-management positions
Reinforcement (training)
Use of encouraging words and actions that re-emphasize the proper way to do a job task
Safety hazard
Conditions in the workplace that can cause immediate harm. Examples include unsafe equipment, accidents, and the improper use of chemicals
The process of evaluating job applicants to determine who is most qualified for and likely to be successful in a vacant position
A group of individuals who work together and set the goals of the group above their own
Turnover (employee)
The replacement of employees needed in an organization or a position as other staff members leave
To validate or confirm. When used in reference to a credit card offered by a guest at
the time of check-in, the term “authorize” refers to the office agent’s validation of the card. A
hotel’s front office validation means: (A) The card is being used legally. (B) The card has
sufficient credit remaining to pay for the guest’s estimated charges. (C) A hold for a dollar
amount determined by front of
fice policy has been placed on the card to ensure the hotel’s payment. Used as in “Lisa, please authorize Mr. Patel’s MasterCard for $1,000.”
Back-up system
Redundant hardware and/or software operated in parallel to the system it
serves. Used in times of failure or power outages, such systems are often operated on batteries. For example, a back-up system to the hotel’s PMS would enable continued operation even in the event of a power failure
Black-out date
Specific day(s) when the hotel is sold out and/or is not accepting normal reservations
Call accounting
The system used by a hotel to document and charge guests for the use of their in-room telephones
Cancellation number
A series of numbers and/or letters that serve to identify the cancellation of a specific hotel reservation
Central reservations system (CRS)
The industry term for the computerized program used to record guest room reservations
Confirmation number
A series of numbers and/or letters that serve to identify a specific hotel reservation
Contract rate
A fixed term room rate that is agreed to in advance and for the length of the
contract agreement. For example, the agreement by a hotel to provide five rooms every Sunday through Thursday night for one year for an out-of-town road construction crew working on a nearby highway project
Corporate rate
The special rate a hotel charges to its typical business traveler. For example, a rate that is 5-20 percent below the hotel’s rack rate might be designated as the hotel’s corporate
Curb appeal
The initial visual impression the hotel’s parking areas, grounds, and external buildings create for an arriving guest
Detailed list of a hotel guest’s room charges as well as other charges authorized by the
guest or legally imposed by the hotel
The hotel industry term for a front office manager
Front Desk
The area within the hotel used for guest registration and payment
Front Office
The department within the hotel responsible for guest reservations, registration, service, and payment
Group rate
Special discounted room rates given to customers who agree to buy a large number
of room nights for their group. In smaller hotel
s, any customer buying 10 or more room nights
would likely qualify for a group rate. In larger hotels, the number of rooms required to qualify
can vary to a greater number. Examples of those qualifying for group rates include leisure tour
buses, wedding parties, sports teams, business meetings, and conventions
Guest history
Information related to the past stay(s) of one guest
Historical data
Information related to the stays of past guests. Collectively, this information details the history of all past hotel guests
The process in which one data-generating system automatically shares all or part of
its information with another system
Negotiated Rate
An agreed upon rate that is offered by a hotel but is subject to room availability. Also referred to as a volume rate or volume discount rate. A rate agreed to by a hotel and a large company that does significant business with the hotel is an example of a negotiated rate
Night audit
The process of reviewing for accuracy and completeness the accounting transactions from one day to conclude, or “close,” that day’s sales information in preparation for recording the transactions of the next day
Night auditor
The individual who performs the daily review of all the financial transactions with hotel guests recorded by the front office
A guest who makes a room reservation but fails to cancel it or does not arrive at the hotel on the date of the confirmed reservation
A situation in which the hotel has more confirmed guest reservations than it has
rooms available to lodge those guests. Sometimes referred to as “oversold.”
Short for “Private Branch Exchange.” The system within the hotel used to process incoming, internal, and outgoing telephone calls
To enter a guest’s charges into the PMS to create a permanent record of the sale. Used as in
“Please post this meeting room charge to Mr. Walker’s folio.”
Property management system (PMS)
The industry term for the computerized system used to record guest reservations, financial information, and other data related to the operation of a hotel’s front office
Rack rate
The price at which a hotel sells its rooms when no discounts of any kind are offered
to the guest. Often shortened to “rack.”
Registration (Reg) card
A document that provides details such as guest’s name, arrival date, rate to be paid, departure date, and other information related to the guest’s stay. In conversation, most often shortened to “Reg” card, as in: “Where is the signed Reg card for room 417?”
Revenue Management (RM)
The process and procedures used to optimize RevPAR
Revenue Manager
An individual whose major task consists of forecasting room demand so that the hotel can maximize RevPAR. In larger hotels, this will be a full-time position. In a smaller, limited-service property, the general manager or FOM will have this responsibility
Room night
The number of rooms used times the number of nights they are sold. For example, a guest who reserves two rooms for five nights each has made a reservation for 10 room nights (2
rooms x 5 nights = 10 room nights)
Room type
Specific configurations of guest rooms. For example, king-sized bed vs. double-sized bed, or parlor suite vs. standard sleeping room. Commonly abbreviated (K for king, D for
double bed, etc.), reserving of the proper room type is often as important to guests as whether thehotel, in fact, has a room available for them
(1) A situation in which all available rooms are sold. A hotel, area, or entire city may, if demand is strong enough, sell out. (2) A period of time in which management must attempt to optimize ADR
Individual guests who are not part of a group or tour booking. Transient guests can be further subdivided by traveler demographics to obtain more detailed information about the type of guest staying in the hotel (e.g., corporate, leisure, and government)
Tactics used to increase the hotel’s average daily rate (ADR) by encouraging guests to reserve higher-priced rooms with better or more amenities than are provided with lower-priced rooms (e.g., view, complimentary breakfast and newspaper, increased square footage)
A situation in which a guest with a reservation is relocated from the reserved hotel to another hotel because no room was available at the reserved hotel
A guest seeking a room who arrives at the hotel without an advance reservation