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Introduction to Service Management

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Hong Kong Community College

CCN2143 – Introduction to Service Management (Semester One 2017/18)

Group Assignment – WRITTEN REPORT


To begin with, YMCA is a charity organization which own lots of hotel and guesthouse in Hong Kong. Although it attracts many customer, it has some existing problem. In our project, we will find out the nature of service, service process, service strategic and service firm competitiveness. Also, we will recommend some suggestions to make improvement on the service of YMCA.  


YMCA which locates in Shek Kip Mei Estate is a small guesthouse in Kowloon. Their main target customers are some backpackers and short-term traveller. YMCA provides the hotel service and use a low price to attract customer. The room is about $700 per night. They provide the breakfast and dinner service.


For the competitive service strategies, YMCA was implementing a low-cost strategy which is the Overall cost leadership. As we know, YMCA is not a hotel, it is hostel which is slightly different. In the price, YMCA is cheaper than the other hotel as they want to serve a lot of customers. Therefore, they need to lower the price. Owing to the low price is one of the attractive force, implement a low-cost strategy can build the market share.

Overall cost leadership is required tight cost, efficient-scale and overhead control. It also required high capital investment to purchase the relevance equipments and start-up losses to build market share. It is suitable to use on YMCA since hospitality is a long term investment, it can’t gain any profit when it starts up. YMCA provide a low-cost service and cost leader strategy is useful.

First of all, YMCA provide a low-cost strategy to seek out low-cost customers. The aim of YMCA hostel is to offer the space that customer will feel secure, respected, heard and valued. Those things are all the fundamental need of the customer. Therefore, YMCA target customers who are willing to pay for less-worse hostel. However, some luxury hotel aim at high-cost customers so they will focus on customer service, in order to distinguish themselves. For example, the four seasons hotel which is a five stars hotel, saying that they will treat everyone we meet the way we would want to be treated ourselves.

Secondly, YMCA has standardizing their custom service. In YMCA, they provide a shuttle bus, morning call, dry cleaning service. Those service are both customized service, but YMCA has standardize it. The customer don’t need to custom made, they just need to give a call to the reception department. Then they will provide us those customize service like calling on time in the morning. This standardized service can let the service become custom service, and the customers can also feel satisfied to the hotel’s service.


The competitive uses of information about YMCA are the Productivity Enhancement. First of all, for the Data Envelopment Analysis (DEA), DEA is a linear programming based technique for measuring the relative performance of organizational units where the presence of multiple inputs and outputs makes comparisons difficult. DEA compares each service delivery unit with all other service units for a motorist organization, and it computes an efficiency rating that is based on the ratio of resource inputs to outputs. For the amount of employee, the company should use the part-time employee as they can help supplement regular employee. During the peaks of activity, part-time worker can help to smooth the demand of the customer and increase the production capability. Not only using the part-time workers, the company should provide the cross training to the full time employee. It is because service system are not stale. When one operation is busy, another operation sometimes may be idle. Therefore, every employee needs to cross- training and perform tasks in several operations create flexible capacity in order to meet localized peaks in demand. It can help to reduce the production cost in order not to hire many full time employees.

For creating Adjustable Capacity. The company needs to meet the demand with the supply. If the needs of standard room are larger than the Luxury Suite, the company needs to change the theme of the room in order to meet the changing demands of the customers. For example, the company can increase the numbers of the standard room and change the Luxury Suite to the standard room. It can help to increase the supply and meet the demand of the customers.

Secondly, for the inventory status, YMCA needs to keep track the inventory in different ways in order to prevent the unsatisfying of the customers and control the production cost of the hotel. For the food, YMCA need to make sure that the food of the hotel is enough also not expired. For the amount of new bedding, the YMCA also needs to make sure the amount bedding is enough. For the others like the TV remote, YMCA also needs to make sure the inventory is enough. As the service is intangible and cannot inventory, so that those customers will pay attention to the hotel’s commissioner. If the hotel cannot achieve their expectations and provide enough resources, they will dissatisfy with us. Ultimately, we will lose the customers.


1. Available for Service

2. Journeyman

3.Distinctive Competence Achieved

4. World-Class Service Delivery


 Not for some compulsory reasons such as living in the refuge since beneficiaries have no choices.

customers seek out the Youth Hostel actively on the reputation of the reasonable price

the name of the Youth hostel is not synonymous to service excellence; and it unable to expand customer expectations to its competitors, e.g. Burj Al Arab Jumeirah


 The business is not solely perform at a minimum cost

  • only need to meet some basis customer needs such as it maintains an affordable price for budget travelers
  • apply operations strategies ensuring efficient business operations
  • control the delivery processes
  • failed to create maximal value for customers and the service delivery system is unable to support an intense customer focus.

Service quality

Refugee Camps

  • Positions itself as an educational hostel and hostellers are not “customers” but are required to self-serve

Back office

The YHA MEI HO House Youth Hostel

Separate role


Refugee Camps

as it is focus on a group of people but not a collection of individuals

 they do not listen to customers or coaches; is failed to satisfy them of variation in needs, e.g, they only offer a pre-prepared free breakfast with a small dry bread and tasteless corn but customers want different menu.

Introduction of new technology

Only provide the basis equipment to meet customer needs; Lady MacLehose Holiday Village as an example, it offers a separate karaoke and TV room to satisfy different customer needs (stage 3); L’hotel Mong Kok using state-of-the-art facilities such as eKiosk and electric car charger to provide value-added services to customers(nearly stage 4)


Refugee Camps

Follow procedure to avoid simple mistakes, e.g. wrong booking by first-line staff

First-line management

Refugee Camps

NOT listen to customers; NO new ideas; Management is a controller.



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