Higher Nationals

Internal verification of assessment decisions – BTEC (RQF)

INTERNAL VERIFICATION – ASSESSMENT DECISIONS
Programme title Higher National Diploma in Hospitality Management

Ms. Navodhi Karunarathne

Assessor Internal Verifier
Hospitality Supply Chain Management
Unit(s)
Supply chain strategy recommendations
Assignment title

Student’s name
List which assessment Pass Merit Distinction
criteria the Assessor has
awarded.
INTERNAL VERIFIER CHECKLIST

Do the assessment criteria awarded match

those shown in the assignment brief? Y/N Yes

Is the Pass/Merit/Distinction grade awarded Yes

justified by the assessor’s comments on the Y/N
student work?
Has the work been assessed Yes
Y/N
accurately?
Is the feedback to the student: Yes
Give details:

• Constructive?
Y/N
• Linked to relevant assessment
criteria? Y/N

• Identifying opportunities for

improved performance? Y/N

• Agreeing actions? Y/N

Does the assessment decision need No

Y/N
amending?
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Date
required)
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Higher Nationals - Summative Assignment Feedback Form
Student Name/ID K.A.K. Sandeepa /E193610
Unit Title Unit 20 : Hospitality Supply Chain Management
Assignment Number 1 Assessor Ms. Navodhi Karunarathne

06/08/2024 Date Received 1st

Submission Date
submission
Date Received 2nd
Re-submission Date
submission
Assessor Feedback:

LO1 Apply key supply chain concepts, principles, and processes in a hospitality context

Pass, Merit & Distinction P1 M1 D1

Descripts

LO2 Evaluate the importance of effective supply chain management

Pass, Merit & Distinction P2 M2 D1
Descripts

LO3 Examine the interrelationships between supply chain and other areas of a hospitality organisation

Pass, Merit & Distinction P3 M3 D2

Descripts

LO4 Recommend improvements to a supply chain strategy for a hospitality organisation

Pass, Merit & Distinction P4 M4 D3

Descripts

Grade: Assessor Signature: Date:

Resubmission Feedback:

Grade: Assessor Signature: Date:

Internal Verifier’s Comments:

Signature & Date:

* Please note that grade decisions are provisional. They are only confirmed once internal and external moderation has taken place and grades decisions have
been agreed at the assessment board.
Assignment Feedback
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Pearson Higher Nationals in
Hospitality Management
Unit 20: Hospitality Supply Chain Management

Assignment 01
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Student Declaration

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Assignment Brief
Student Name /ID Number K.A.K.Sandeepa/E193610

Unit Number and Title Unit 20: Hospitality Supply Chain Management

Academic Year 2020/2021

Unit Tutor Ms. Navidhi Karunarathne

Assignment Title Supply chain strategy recommendations

Issue Date 06/04/2024

Submission Date 06/08/2024

IV Name & Date

Submission Format:

Activity 1

Submission is in the form of an individual written report. This should be written in a concise, formal
business style using single spacing and font size 12. You are required to make use of headings, paragraphs,
and sub-Activities as appropriate, and all work must be supported with research and referenced using the
Harvard referencing system. You should also provide a bibliography using the Harvard referencing system.
The recommended length is 3000–4000 words, although you will not be penalized for exceeding the word
limit.

Unit Learning Outcomes:

LO1 Apply key supply chain concepts, principles, and processes in a hospitality context

LO2 Evaluate the importance of effective supply chain management

LO3 Examine the interrelationships between supply chain and other areas of a hospitality organization

LO4 Recommend improvements to a supply chain strategy for a hospitality organization.

Assignment Brief and Guidance:

Activity 01:

Assume you are a Supply Chain Trainee Executive in an organization of your choice in a hospitality industry
in Sri Lanka. As a Trainee Executive, you are requested to produce a report on explaining the strategic
importance of a Supply Chain Management for the selected organization. As a part of the report, you are
supposed to include below tasks.

1. Demonstrate how key supply chain concepts, principles and processes are applied throughout the

2. the selected organization in the below mentioned areas. Critically evaluate by providing examples:
- stages of resourcing
- service or product design and development
- logistics and distribution

3. An evaluation on how integration of supply chain concepts principles and processes improve
efficiency of the selected organization.

4. An evaluation of the importance of effective SCM from different perspectives together with a
critical evaluation on physical information and financial management within the supply chain in
the selected organization:
- Customers
- Suppliers
- Distributors
- Retailers

5. A critical evaluation of the implications of interrelationships between the supply chain and other
functional areas using theories, concepts and/or models of the selected organization and make
recommendations for improvements.
- Cross-functional Approach
- Integrated Approach
Activity 02:

You and a partner (in pairs) must assess the current hospitality supply chain strategy for an organisation
of your choice – your own place of work if appropriate. You are to investigate the organization’s supply
chain and suggest improvements on hospitality supply chain management to be presented as a
presentation at the Annual General Management of the selected organization.

The presentation must focus on the following:

1. An evaluation of the organization’s procurement and supply strategy

2. Critical analysis of issues and challenges within the current hospitality supply chain management
strategy

3. Justified recommendations for improvement, identifying relevant support systems and

documentation to maintain the process.
 Grading Rubric

Grading Criteria Achieved Feedback

LO1 Apply key supply chain concepts, principles, and processes in a hospitality context

P1 Demonstrate how key supply chain

concepts, principles and processes are
applied throughout the stages of
resourcing, service or product design and
development, logistics and distribution,
using hospitality examples.
M1 Evaluate how integration of supply
chain concepts, principles and processes
improve efficiency for a hospitality
organisation
D1 Critically evaluate supply chain
concepts, principles, and processes for
effective supply chain management
LO2 Evaluate the importance of effective supply chain management
P2 Evaluate the importance of effective
SCM from the perspective of customers,
suppliers, distributors, and retailers
M2 Critically evaluate the importance of
physical, information and financial
management within the supply chain
LO3 Examine the interrelationships between supply chain and other areas of a hospitality organisation
P3 Explore the cross-functional and
integrated approach of SCM with other
functional areas within a hospitality
organisation
M3 Evaluate the implications of
interrelationships between the supply
chain and other functional areas using
theories, concepts and/or models.
D2 Critically evaluate supply chain
interrelationships with other functional
areas of a hospitality organisation making
recommendations for improvements.
LO4 Recommend improvements to a supply chain strategy for a hospitality organisation
P4 Evaluate a supply chain strategy
within a hospitality organisation and
present proposals for improvement
M4 Critically evaluate a supply chain
strategy within a hospitality organisation
and present proposals for its
improvement
D3 Justify and recommend
improvements of a supply chain strategy
for a hospitality organisation based on
critical evaluation
 Supply Chain
Management
Assignment 01

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 Acknowledgment
We would like to express our heartfelt gratitude to our esteemed supply chain management
lecturer, Ms. Navodhi Karunarathne. Her dedication, expertise, and passion for teaching have
been instrumental in shaping our understanding of supply chain dynamics and strategies. Ms.
Karunarathne's insightful lectures, guidance, and support have enriched our learning
experience, equipping us with invaluable knowledge and skills to navigate the complexities of
the supply chain industry. We are truly grateful for her unwavering commitment to our
academic and professional development. Thank you, Ms. Karunarathne, for your invaluable
contribution to our growth and success.

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 Executive summary
This report delves into the critical aspects of supply chain management within the hospitality
industry, focusing on the context of Jetwing Sea Hotel, Negombo. Chapter 1 provides an
overview of key supply chain concepts, principles, and processes, elucidating their significance
in hospitality operations. Chapter 2 examines the importance of effective supply chain
management, emphasizing its impact on customers, suppliers, distributors, retailers, and
overall organizational performance. Furthermore, Chapter 3 explores the intricate
interrelationships between the supply chain and various functional areas within a hospitality
organization, including procurement, operations management, marketing, housekeeping,
finance, accounting, and human resources. Through a comprehensive analysis, this report
underscores the vital role of supply chain management in enhancing efficiency, customer
satisfaction, and organizational success, while also advocating for cross-functional
collaboration and the integration of the supply chain with other key functional areas. By
understanding and leveraging these insights, hospitality enterprises like Jetwing Sea Hotel can
optimize their supply chain strategies, drive sustainable growth, and maintain a competitive
edge in the dynamic hospitality landscape.

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 Table of contents
Chapter 1
1. Apply key supply chain concepts, principles, and processes in a
hospitality context…………………………………………………………….……….….…...1
1.1. Supply chain management in the Hospitality industry……………………………..….….2
1.1.1. What is Supply chain management?................................................................................2
1.1.2. Supply Chain Management Concepts…………………………………………………..2
1.1.3. Supply Chain Management Principles………………………………………………….3
1.1.4. Supply Chain Management Processes………………………………………………….4
1.2. Supply chain improving the efficiency of Jetwing Sea Hotel……………….................5-7

Chapter 2
2. Evaluate the importance of effective supply chain management… …………….…….……7
2.1. Importance of Effective Supply Chain Management………………………….……….…7
2.1.1. Customers…………………………………………...…………………….……….……7
2.1.2. Suppliers…………………………………………………………………….…….….…8
2.1.3. Distributors…………………………………………………………….……….…….…8
2.1.4. Retailers……………………………………………………………….….………..…8-9
2.2. Critical Importance of Each Area………………………………………..……………9-10
2.2.1. Overall Importance…………………………………………..………………………..10

Chapter 3
3. Examine the interrelationships between the supply chain and other
areas of a hospitality organization……………………………………..………….….………11
3.1. Cross-Functional SCM at Jetwing Sea Hotel, Negombo…………………….…...……..11
3.1.1. Procurement and Purchasing…………………………………................……………..11
3.1.2. Operations Management………………………………………………….……………11
3.1.3. Marketing and Sales………………………………………...………….……………...12
3.1.4. Housekeeping…………………………………………………................…...………..12
3.1.5. Finance and Accounting…………………………………………….……..…………..12

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3.1.6. Human Resource………………………………………………………………………13
3.2. The Implications of Interrelationships…………………………………………………..13
3.2.1. Procurement and Purchasing…………………………………………….…………….13
3.2.2. Operations Management………………………………………………………….……13
3.2.3. Marketing and Sales…………………………………………………………………...14
3.2.4. Housekeeping……………………………………………………………………….…14
3.2.5. Finance and Accounting……………………………………………………………….14
3.2.6. Human Resource………………………………………………………………………15
3.3. Resource-based view (RBV) theory……………………………………………………..15
3.3.1. Integration of the Supply Chain with Other Functional Areas…………………….15-17

Conclusion……………………………………………………………………………………18
References……………………………………………………………………………………19

Chapter 4
4. Recommend improvements to a supply chain strategy for a hospitality
Organization……………………………………………………………………................20-30

List of tables

Table 1- - Efficiency Improvement table

Table 2 - Critical Importance of Each Area

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 Chapter 1
1. Apply key supply chain concepts, principles, and processes in a
hospitality context

▪ Jetwing Sea Hotel Negombo

Jetwing Sea Hotel in Negombo, Sri Lanka, is a calm place right by the beach. Guests can
relax and enjoy beautiful views of the ocean. The rooms are cozy and have everything guests
need for a comfortable stay. Guests can eat tasty food at the hotel's restaurants and take a
swim in the pool to feel refreshed. The staff is friendly and always ready to help. Whether
you're on vacation or a work trip, this hotel is great for anyone who wants to relax by the sea.

(Negombo Beach Resort | Jetwing Sea Negombo | Official Site, 2024)

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1.1. Supply chain management in the Hospitality industry.

1.1.1. What is Supply chain management?

Supply chain management (SCM) refers to the management of the flow of goods, services,
information, and finances as they move from the supplier to the manufacturer, then to the
wholesaler and retailer, and finally to the end consumer. The goal of supply chain management
is to efficiently coordinate all these activities to ensure that the right product is delivered to the
right place at the right time and at the right cost.

1.1.2. Supply Chain Management Concepts

1. Lean Supply Chain Management

This Supply Chain Management Concept focuses on minimizing waste and maximizing
efficiency throughout the supply chain.

2. Agile Supply Chain Management

This Supply Chain Management Concept emphasizes flexibility and responsiveness to adapt
to changing market demands.

3. JIT inventory management

Just-in-Time (JIT) inventory management is a system where goods and supplies are ordered
and received only as they are needed in the operational process.

▪ The Jetwing Sea Hotel employs supply chain management strategies through various
means, including customer segmentation, customized logistics, market signaling, product
differentiation, strategic supplier management, information technology implementation,
and performance evaluation measure adaptation. They also prefer to produce SCM
principles at every stage of the process: in resourcing, they minimize waste by procuring
locally fresher produce; in product design, they streamline menus based on guest
preferences; in logistics, they optimize transportation routes for on-time delivery; and in
distribution, they use JIT inventory management to cut down on the excess stock. This all-
encompassing strategy guarantees effective operations and outstanding visitor experiences.

(Gomes and Perera,2022)

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1.1.3. Supply Chain Management Principles

1. Segmenting Customers

Adapting supply chain strategies to suit the specific requirements of various customer
segments.

2. Customizing Logistics

Creating logistics processes tailored to the unique needs of various products or customer
groups.

3. Listening to Market Signals

Using information from the market and feedback from customers to predict how much of a
product or service will be needed and then changing how we manage our supply chain to match
those predictions.

4. Differentiating Products

Offering unique product features or services to stand out from competitors and create value
for customers.

5. Strategically Managing Suppliers

Building strong relationships with suppliers and aligning their capabilities with the
organization's strategic objectives.

6. Implementing Information Technology

Utilizing technology to streamline communication, data sharing, and overall supply chain
visibility.

7. Adapting Performance Evaluation Measures

Interacting with customers to process orders, provide support, and gather feedback to improve
the overall customer experience.

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▪ Lean supply chain management principles
1. Identifying value
2. Mapping the value stream
3. Create flow
4. Establish a pull system
5. Continuous improvement

▪ Jetwing Sea Hotel adheres to the seven principles of supply chain management (SCM) and
integrates the five principles of lean SCM across its operations. By segmenting customers,
customizing logistics, listening to market signals, differentiating products, strategically
managing suppliers, implementing information technology, and adapting performance
evaluation measures, Jetwing Sea ensures efficient supply chain operations. From sourcing
locally for fresher produce to streamlining menus based on guest preferences, optimizing
transportation routes for timely deliveries, and implementing just-in-time inventory
management, Jetwing Sea exemplifies a commitment to delivering exceptional guest
experiences while minimizing waste and maximizing efficiency at every stage of the supply
chain.

1.1.4. Supply Chain Management Processes

1. Planning

Forecasting demand, scheduling production, and setting inventory levels to meet customer
needs while optimizing costs.

2. Procurement

Selecting suppliers, negotiating contracts, and acquiring materials or services needed for
production.

3. Production

Manufacturing goods or providing services according to demand forecasts and quality

standards.

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4. Distribution

Managing the transportation, storage, and delivery of goods to distribution centers, retailers,
or end customers.

5. Customer Interface

Interacting with customers to process orders, provide support, and gather feedback to improve
the overall customer experience.

▪ At Jetwing Sea Hotel, supply chain processes are put into action effectively. They plan by
forecasting guest numbers, room reservations, and food needs to ensure they have the right
resources. For procurement, they choose local vendors for fresh ingredients and negotiate
good rates. In production, they prepare delicious meals and maintain a clean, well-stocked
environment. Distribution means delivering excellent service to guests throughout their
stay. The customer interface involves gathering feedback to personalize experiences,
improve logistics, and distribute them to future guests.

(Supply Chain Management Concepts,2023)

1.2. Supply chain improving the efficiency of Jetwing Sea Hotel

Jetwing Sea uses precise just-in-time inventory and accurate demand forecasts to drive a lean
supply chain, reducing waste and cost creating more Agile supply chain management for speed
and flexibility, and enabling the hotel to support higher service standards even in crisis
flexibility Jetwing Sea increases customer satisfaction and loyalty by controlling customer
segmentation and personalized service to meet specific needs. Customized logistics assure
smooth delivery, and listening to market signals enables quick changes, reducing downtime
Strategic supplier management urges promises a reliable supply chain, while differentiation
sets the hotel apart. Adopting a business analytics framework encourages continuous
improvement; while implementing sophisticated IT systems improves communication and
real-time analytics They provide more accurate forecasting, better resource allocation, and
strategic planning.

(Supply Chain Management Concepts,2023)

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Table 1 - Efficiency Improvement table
Aspect Efficiency Improvement
Lean SCM
Reduction of Waste Reduces overstocking, lowers waste, and cuts
costs
Cost Efficiency Lowers operational expenses, improves
profitability
Agile SCM
Flexibility Maintains high service standards during peak
seasons and disruptions

Speed Ensures uninterrupted guest services

Supply Chain Principles

Segmenting Customers Increases customer satisfaction and loyalty

Customizing Logistics Reduces delays and improves service quality

Listening to Market Signals Anticipates demand changes, reduces

downtime, enhances readiness

Differentiating Products Attracts more guests, ensures a steady

revenue stream
Strategically Managing Suppliers Ensures a reliable supply of high-quality
ingredients and materials

Implementing Information Technology Enhances inventory management, streamlines

processes improves real-time tracking

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 Adapting Performance Evaluation Measures Continuously improves supply chain
processes, enhances efficiency and quality

Supply Chain Processes

Planning Ensures optimal resource allocation,
minimizes over/understocking
Procurement Supports local economy, reduces costs,
ensures fresher produce
Production Maintains high service quality and
operational efficiency
Distribution Enhances guest experience with timely
service delivery
Customer Interface Personalizes guest experiences, continually
refines service offerings

(Supply Chain Management Concepts,2023)

Chapter 2
2. Evaluate the importance of effective supply chain management

2.1. Importance of Effective Supply Chain Management

Effective Supply Chain Management is crucial for ensuring that goods move smoothly from
production to consumption, and its significance can be viewed from the perspectives of various
stakeholders: customers, suppliers, distributors, and retailers.

2.1.1. Customers

From the customer’s perspective, effective SCM in the hospitality industry is essential to
ensuring raw material availability, quality, cost efficiency, and improved customer service.
Accordingly, guests expect that they will have the freshest and best-quality food in hotels or
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restaurants. An effective SCM ensures that these products are delivered on time and in good
condition, contributing to a positive dining experience. Furthermore, effective SCM practices
help manage costs, enabling hospitality businesses to deliver competitive value, which is
crucial for customer satisfaction and loyalty. Information management plays a key role here,
as real-time process tracking notifies customers of inventory and service status to provide an
overall improved experience.

2.1.2. Suppliers

Suppliers in the hospitality industry also greatly benefit from effective SCM. Consistent and
predictable ordering allows suppliers to better manage their production schedules and
inventories, reduce waste, and maximize resources while fostering strong supplier relationships
through clear payment and communication, facilitated by effective SCM practices. This
collaborative approach helps manage the risks associated with demand fluctuations and supply
chains. For example, a hotel’s just-in-time (JIT) system ensures that fresh produce and other
perishables are delivered as needed, reducing waste and maintaining standards in the field of
good things.

2.1.3. Distributors

Acting as intermediaries between suppliers and hospitality businesses, distributors rely heavily
on effective SCM for inventory management, cost efficiency, and market responsiveness.
Appropriate physical infrastructure, such as well-located warehouses and efficient
transportation routes, ensures timely delivery and reduces warehousing costs, which allows
distributors to operate if changes occur in market demand and respond quickly. Financial
measures, such as credit management and payment cycle management, ensure that distributors
maintain a healthy cash flow, which is critical to their sustainable operations.

2.1.4. Retailers

Retailers in the hospitality industry, including hotels, restaurants, and food services, benefit
from effective SCM through improved shelf capacity, cost control, and an enhanced customer
experience to ensure the availability of products and services when and where customers need

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them. Level of service Customer satisfaction is important to maintain. Efficient logistics and
inventory management help vendors reduce inventory and excess inventory situations,
optimizing their operations. Information systems, such as point-of-sale (POS) systems, provide
valuable insights into sales, which contribute to better inventory and order management.
Effective financial management ensures monitoring lower purchase costs and avoiding tying
up unnecessary capital in inventory, improving overall profitability.

(Fawcett, Magnan, and McCarter, 2008)

▪ Effective SCM is essential to the success of the hospitality industry, benefiting customers,
suppliers, distributors, and retailers alike. Physical infrastructure ensures efficient
movement of resources; information systems provide the information needed for informed
decision-making; and financial systems maintain the financial health of the supply chain.
By integrating these elements with ease, the hospitality industry can develop complex
offerings that can adapt to market fluctuations and meet the expectations of stakeholders.

M2

2.2. Critical Importance of Each Area

Table 2 - Critical Importance of Each Area

Area Importance Impact Effective Practices

Directly impacts customer -Stockouts • Efficient warehousing

Physical satisfaction by ensuring -Delays • Transportation
product availability and -Increased costs optimization
timely deliveries. • Robust inventory
control.
The lifeblood of effective -Poor forecasting • Accurate demand
Supply Chain Management, -Stockouts forecasting
Information enabling informed decision- -Missed • Real-time inventory
making. opportunities visibility,
• Seamless information
flow across the
supply chain.

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 Optimizes costs and ensures -Cash flow • Timely payments
Financial financial stability problems • Cost minimization
throughout the supply -Late payments strategies
chain. -Strained supplier • Effective risk
relationships management

2.2.1. Overall Importance

Strong physical, information, and financial management form the cornerstone of a successful
SCM. By optimizing these areas, organizations can achieve:

▪ Improved customer satisfaction through better product availability and on-time deliveries.
▪ Reduced costs by minimizing waste, optimizing transportation, and negotiating better deals
with suppliers.
▪ Enhanced efficiency through improved collaboration and information sharing across the
supply chain.
▪ Increased profitability through better cost control and improved sales.
▪ Stronger supplier relationships through timely payments and collaborative communication.

(Fawcett, Magnan, and McCarter, 2008)

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 Chapter 3
3. Examine the interrelationships between the supply chain and other
areas of a hospitality organization

3.1. Cross-Functional SCM at Jetwing Sea Hotel, Negombo

Exploring the cross-functional and integrated approach of Supply Chain Management (SCM)
within Jetwing Sea Hotel Negombo involves understanding how SCM interfaces with various
functional areas to enhance efficiency, customer satisfaction, and overall performance. In a
hospitality organization like Jetwing Sea Hotel, effective SCM is critical for ensuring seamless
operations and superior guest experiences. Here’s how SCM integrates with other functional
areas:

3.1.1. Procurement and Purchasing

SCM works closely with the procurement and purchasing departments to source the best quality
goods and services at competitive prices. This involves selecting suppliers, negotiating
contracts, and ensuring timely delivery of supplies such as food, beverages, linens, and cleaning
supplies.

Example:

Jetwing Sea Hotel leverages SCM to create strategic partnerships with local suppliers to ensure
the consistent availability of fresh produce and other perishable items. This helps in
maintaining high standards in the hotel's dining services.

3.1.2. Operations Management

SCM is integral to operations management, particularly in inventory control, logistics, and
workflow management. By coordinating closely with operations, SCM ensures that the right
products are available at the right time, minimizing delays and optimizing service delivery.

Example:

By implementing Just-In-Time (JIT) inventory practices, Jetwing Sea Hotel can reduce excess
inventory and waste, ensuring that only the necessary items are stocked and used efficiently.

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3.1.3. Marketing and Sales
SCM supports marketing and sales by ensuring product availability and meeting promotional
commitments. An effective SCM ensures that the products and services promised in marketing
campaigns are delivered as advertised, thereby enhancing customer satisfaction.

Example:

For special promotional events, such as a themed dinner or a holiday package, SCM ensures
that all required resources are available, from special ingredients to decorations, aligning with
marketing efforts to attract guests.

3.1.4. Housekeeping
Housekeeping relies on SCM for the timely and efficient supply of cleaning materials,
toiletries, and linens. Effective SCM ensures that these supplies are always in stock, enabling
the housekeeping staff to maintain the cleanliness and readiness of guest rooms.

Example:

Through a well-managed SCM system, Jetwing Sea Hotel ensures that there is no shortage of
essential housekeeping items, thereby maintaining high standards of room cleanliness and
guest comfort.

3.1.5. Finance and Accounting

SCM impacts financial management by optimizing costs, improving cash flow, and managing
budgets related to procurement and logistics. Finance and SCM must work together to ensure
that the supply chain operates within budgetary constraints and contributes to the hotel’s
profitability.

Example:

The finance team at Jetwing Sea Hotel uses data from the SCM system to forecast expenses,
manage cash flow, and identify cost-saving opportunities, such as bulk purchasing or
negotiating better terms with suppliers.

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6. Human Resource

SCM intersects with HR in the recruitment and training of staff involved in supply chain
activities. This includes warehouse workers, logistics managers, and procurement officers,
ensuring that the supply chain operates efficiently.

Example:

HR at Jetwing Sea Hotel works with SCM to identify skill gaps and provide targeted training
programs, ensuring that all staff involved in supply chain processes are well-equipped to
perform their roles effectively.

(Mentzer, Stank, & Esper, 2008)

3.2. The Implications of Interrelationships

3.2.1. Procurement and Purchasing

Interrelationships with the supply chain are crucial for procurement and purchasing in
hospitality. Integration ensures that the procurement process aligns with the strategic goals of
the organization. Efficient supply chain management enables the timely sourcing of high-
quality materials and amenities, essential for maintaining service standards and guest
satisfaction. Additionally, strong relationships with suppliers cultivated through the supply
chain can lead to better negotiation terms, cost savings, and competitive advantages.

3.2.2. Operations Management

Operations management in hospitality heavily relies on the supply chain for the seamless
delivery of services. Integration ensures that operational processes are synchronized with the
supply chain, optimizing resource utilization and minimizing waste. Timely delivery of goods
and services, facilitated by effective supply chain management, is essential for meeting guest
expectations and maintaining operational efficiency. This integration also enables real-time
tracking of inventory levels and enhances the responsiveness of operations to fluctuating
demands.

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3.2.3. Marketing and Sales
The supply chain has significant implications for marketing and sales strategies in hospitality.
Integration allows marketing efforts to be aligned with the capabilities of the supply chain,
ensuring that promotional activities accurately reflect the availability and quality of services
offered. For instance, marketing campaigns can be tailored to highlight unique amenities or
experiences made possible through efficient supply chain management. Additionally, the
reliability and consistency of service delivery facilitated by the supply chain contribute to
building brand reputation and attracting customers.

3.2.4. Housekeeping
Housekeeping operations are directly impacted by the supply chain, particularly in terms of
sourcing cleaning supplies and amenities. Integration ensures that housekeeping activities are
aligned with procurement processes, guaranteeing the availability of necessary supplies to
maintain cleanliness and hygiene standards. Efficient supply chain management also
minimizes disruptions in housekeeping operations by ensuring the timely replenishment of
supplies and equipment, thereby enhancing overall guest satisfaction.

3.2.5. Finance and Accounting

Supply chain integration has significant financial implications for hospitality organizations.
Efficient procurement practices, enabled by supply chain management, contribute to cost
savings and improved profitability. Timely inventory management ensures that financial
resources are allocated effectively, minimizing carrying costs and reducing the risk of
stockouts. Additionally, integration with the supply chain provides greater transparency into
procurement and purchasing processes, facilitating accurate budgeting and financial
forecasting.

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3.2.6. Human Resource
Interrelationships between the supply chain and human resource management are essential for
ensuring employee satisfaction and productivity in hospitality. Integration facilitates the timely
delivery of resources and equipment necessary for employees to perform their duties
effectively. For example, ensuring that staff have access to the required supplies and amenities
enhances job satisfaction and morale. Additionally, effective supply chain management can
streamline logistical processes, reducing the burden on employees and allowing them to focus
on delivering exceptional service to guests.

(Power, 2005)

3.3. Resource-based view (RBV) theory

Jetwing Sea Hotel Negombo applies the Resource-Based View (RBV) theory to assess how its
unique resources and capabilities, integrated with the supply chain, contribute to its competitive
advantage and overall performance.

3.3.1. Integration of the Supply Chain with Other Functional Areas

1. Procurement and Purchasing:

RBV Perspective: The hotel's procurement department is pivotal in sourcing high-quality

materials and amenities. Through SCM integration, procurement aligns with strategic
objectives, leveraging supplier relationships as a competitive advantage.

2. Operations Management:

RBV Perspective: Efficient operations management is crucial for guest satisfaction. SCM
integration allows leveraging operational capabilities like room turnover times and
housekeeping efficiency for exceptional service, maintaining a competitive edge.

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3. Marketing and Sales:

RBV Perspective: Marketing and sales aim at guest attraction and retention. SCM integration
ensures marketing aligns with supply chain capabilities such as room availability and service
quality, meeting guest expectations.

4. Finance and Accounting:

RBV Perspective: Financial management is vital for profitability. SCM integration optimizes
procurement and inventory management, contributing to cost reduction and financial stability.

▪ Implications of Interrelationships

1. Operational Efficiency

Integrating the supply chain with other functional areas enhances operational efficiency by
aligning processes and resources toward common goals, reducing waste, and enhancing cost
savings.

2. Resource Optimization

Interrelationships allow Jetwing Sea Hotel to leverage resources effectively. Aligning

procurement, operations, marketing, and finance activities with SCM maximizes resource
value, improving performance and competitive advantage.

3. Guest Satisfaction

Integrated SCM practices ensure consistent, high-quality service delivery to guests, enhancing
satisfaction and loyalty through efficient operations and personalized experiences.

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4. Competitive Advantage

Effective integration strengthens Jetwing Sea Hotel's competitive position. Leveraging unique
resources and capabilities across functional areas creates a sustainable advantage that is
challenging for competitors to replicate.

(Shibin et al., 2020)

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 Conclusion
In conclusion, this report has provided a comprehensive analysis of supply chain management
within the context of Jetwing Sea Hotel, Negombo, Sri Lanka. Through an exploration of key
concepts, principles, and processes, as well as an examination of the interrelationships between
the supply chain and other functional areas of the hotel, valuable insights have been gained into
the critical role of SCM in the hospitality industry.

Jetwing Sea Hotel exemplifies the effective application of SCM principles and practices to
optimize efficiency, enhance customer satisfaction, and drive competitive advantage. By
segmenting customers, customizing logistics, listening to market signals, strategically
managing suppliers, implementing information technology, and adapting performance
evaluation measures, the hotel ensures seamless operations and outstanding guest experiences.

The integration of the supply chain with other functional areas such as procurement,
operations management, marketing, housekeeping, finance, accounting, and human resources
underscores the interconnectedness of organizational processes and the importance of cross-
functional collaboration.

The adoption of Lean and Agile SCM strategies, coupled with just-in-time inventory
management and advanced logistics, enables Jetwing Sea Hotel to minimize waste, improve
flexibility, and maintain high service standards even in challenging circumstances.
Additionally, the utilization of the Resource-Based View (RBV) theory allows the hotel to
leverage its unique resources and capabilities for sustained competitive advantage.

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 References
Negombo Beach Resort | Jetwing Sea Negombo | Official Site (2024).
https://www.jetwinghotels.com/jetwingsea/#gref.
Gomes, K. and Perera, H.N., 2022. Assessing the impact of lean and agile supply chain
strategies on effective COVID-19-mass vaccinations.
Bandara, W.M.S.T., 2018. Green supply chain management practices in sustainable
development in the hospitality industry in Sri Lanka (Doctoral dissertation).
Supply Chain Management Concepts (2023).
https://cscmp.org/CSCMP/CSCMP/Develop/Starting_Your_Career/Supply_Chain_Managem
ent_Concepts.aspx#:~:text=Seven%20Principles%20of%20SCM&text=Principle%201%3A
%20Segment%20customers%20based,and%20profitability%20of%20customer%20segments.
Fawcett, S.E., Magnan, G.M. and McCarter, M.W., 2008. Benefits, barriers, and bridges to
effective supply chain management. Supply chain management: An international journal,
13(1), pp.35-48.
Mentzer, J.T., Stank, T.P. and Esper, T.L., 2008. Supply chain management and its
relationship to logistics, marketing, production, and operations management. Journal of
Business Logistics, 29(1), pp.31-46.
Power, D., 2005. Supply chain management integration and implementation: a literature
review. Supply chain management: an international journal, 10(4), pp.252-263.
Shibin, K.T., Dubey, R., Gunasekaran, A., Hazen, B., Roubaud, D., Gupta, S. and Foropon,
C., 2020. Examining sustainable supply chain management of SMEs using resource-based
view and institutional theory. Annals of Operations Research, 290, pp.301-326.

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 Chapter 4

4. Recommend improvements to a supply chain strategy for a hospitality

organization

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"Let's dive into the fascinating world of Hilton. Imagine it's 1919, and Conrad Hilton opened
the very first Hilton hotel in Cisco, Texas. Fast forward to 1983, when the company takes a
significant step by incorporating and later being listed on the Colombo Stock Exchange. Today,
Hilton isn't just a hotel chain; it's an experience. With a whopping 382 rooms, 36 suites, and an
array of dining venues, the Hilton caters to every guest's need. It's no wonder they're considered
one of the biggest and fastest-growing hospitality giants globally. And if you're a fan of luxury,
you'll be pleased to know that Conrad Hotels, a part of the Hilton family, can be found not just
in the US but also in exotic destinations like Bangkok, Egypt, and Singapore, adding a touch
of elegance to the global hospitality scene."

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Procurement and supply chain are vital aspects of Hilton's operations. Procurement involves
sourcing goods and services essential for business functions, while supply chain management
encompasses the broader process of manufacturing, delivery, and ensuring timely and cost-
effective delivery to customers. As noted by Jenkins (2024), an efficient procurement process
not only ensures the availability of necessary resources but also contributes to overall
profitability. This comprehensive understanding of procurement and supply chain forms the
backbone of Hilton's operations, and exploring proposals for improvement in these areas can
further enhance efficiency and customer satisfaction.

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Hilton's supply chain strategy serves as a roadmap, orchestrating various activities from
procurement to logistics management. This comprehensive approach involves coordinating
with external stakeholders like suppliers and service providers to ensure seamless operations.
The strategy encompasses three key aspects: its resilience to change, the investment required,
and its long-term sustainability. To achieve excellence, Hilton focuses on five core strategies,
including resilient sourcing, leveraging digital tools for sourcing and procurement, efficient
supply chain management, remote production, and continuous efforts toward enhancing
efficiency and reducing costs. These strategies form the foundation of Hilton's supply chain
operations, facilitating agility, innovation, and cost-effectiveness.

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Hilton adopts a top-down supply chain strategy, emphasizing aligning resources with business
objectives, such as forecasting, project management, and decision-making processes.
Additionally, the company embraces lean and agile principles, prioritizing efficiency and
customer value by minimizing waste and enhancing operational flexibility. Logistics,
production, and distribution are integral components of Hilton's supply chain approach,
ensuring smooth operations and timely delivery of services. Moreover, Hilton places a strong
emphasis on technology integration, leveraging the latest advancements to remain competitive
and enhance its supply chain capabilities. These strategies collectively underscore Hilton's
commitment to innovation, efficiency, and delivering exceptional experiences to its customers.

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Analyzing Hilton's supply chain strategy reveals both strengths and areas for improvement.
While the agile approach emphasizes responsiveness and efficiency, it also presents challenges.
One major issue is balancing reactivity with productivity, as being quick to respond can
sometimes compromise overall productivity. Additionally, reliance on suppliers for timely
deliveries introduces risks, as delays upstream can disrupt the entire supply chain. Moreover,
the inherent complexity of managing multiple partners, processes, and technologies adds
another layer of difficulty. Variability in demand further complicates matters, potentially
leading to inventory management issues. Addressing these challenges requires careful
consideration and targeted improvements. For instance, Hilton could explore strategies to
enhance supplier reliability and streamline processes to mitigate complexity. Moreover,
clarifying which items or suppliers require agile handling can help allocate resources
effectively. By addressing these challenges, Hilton can strengthen its supply chain resilience
and enhance overall operational efficiency.

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To enhance Hilton's supply chain operations, several key proposals for improvement have been
identified. Firstly, partnering with automation groups can drive quality, efficiency, and
sustainability, particularly in managing power costs. Secondly, prioritizing sustainable
practices across labor, human rights, environment, and procurement can help reduce the carbon
footprint while ensuring the timely delivery of products. Thirdly, leveraging factory automation
technologies can enhance quality while lowering costs sustainably. Additionally, advanced
logistics systems, incorporating robotics technology, can optimize processes from goods
receiving to storage and picking. Implementing a Bottom approach can streamline operations
across various entities within Hilton, promoting consistency and efficiency. Moreover,
improving inventory management strategies and adopting Just-in-Time (JIT) principles can
further minimize costs and enhance operational efficiency. These proposals collectively aim to
strengthen Hilton's supply chain resilience, sustainability, and competitiveness in the
hospitality industry.

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In light of recent research and industry insights, several recommendations emerge for
enhancing Hilton's supply chain strategy. Firstly, prioritizing sustainability can yield numerous
benefits, including cost reduction, improved operational performance, innovation, and
heightened employee engagement, as highlighted by Sarode (2022). Secondly, adopting a
Hybrid (LeAgile) strategy, as advocated by Gray (2017), can effectively cater to high-demand
scenarios, deliver unique products, and minimize supply costs. Lastly, implementing a robust
risk mitigation strategy, as emphasized by Shahzad (2019), can help Hilton proactively address
and mitigate potential risks, ultimately safeguarding its operations and reputation. These
recommendations, aligned with current research and industry best practices, can empower
Hilton to optimize its supply chain strategy, enhance customer satisfaction, and drive
sustainable growth.

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