Outsourcing and Hotels

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What is Outsourcing?
Outsourcing can be defined as a business relationship in which two or more companies work together to achieve a collective advantage. Rugman et al (2003)

If you look back ten – fifteen years ago outsourcing in hotels was not a popular concept but more recently with the downturn in the economy in the nineteen nineties more and more hotels are turning to outsourcing to help increase their revenues and maximize their profit potential. The use of outsourcing enables firms to maximize their resources and to reinforce their competitive advantage. One of the most popular areas for outsourcing in hotels would have to be the Food and Beverage sector. The decision to outsource by many hotels has been
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The service provider re engineers the work of specific functions and at the end of the contract the client regains full responsibility and control.
6. Joint venture outsourcing involves the use of a niche in the given market and setting up a new company. The client provides the staff and the assets. The profits from the company will be divided out as in the agreement.
7. Equity stakes is the strengthening of the outsourcing agreements by either the client or the provider of the equity stake in the other.

What can be outsourced?
Within a hotel almost every department can be outsourced but not only in hotels in any industry almost any function can be outsourced. Outsourcing can be undertaken in some of the following ways of a business process.
- Traditional Services
- Current and new services
- Core competencies
- Projects
Robinson et al (1995)

Every hotel and property will have many different valid reasons on whether to outsource or not to outsource. The main operations in a hotel that are most likely to be outsourced are;
- Specialist services where specialised personnel or skills are required
- Functions that would have fast changing IT requirements
- Operations where recruitment of employees and training of employees is of a high cost to the hotel
- Operations that are labour intensive
- The operations which are the commonplace
Robertson et al (1995) cited in Fox (2005) p 13

Outsourcing within the Hospitality Industry
Within the
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