Prepared By: Rakeeb Ashraf From - Notre Dame University Bangladesh

1. Team SYNERGY

2. Starwood Hotels and Resorts

3. Overview
Name : Starwood Hotels & Resorts
Type : Subsidiary
Industry : Hospitality & Tourism
Founded :1969 as a Real Estate Investment Trust(REIT).
1980 as a Corporation.
Head Quarter : Stamford, Connecticut, U.S
Area Served : World Wide
Products : Hotels, Resorts
Website : www.starwoodhotels.com

4. Key concept
Staffing plan
Employee
Management
Sales
Operations

5. Factors that affects in
planning process at Starwood
Finance Marketing
Operations
Information
System

6. The organization uses a mixed strategy to be able to handle the
different requirements and needs that arise.
Starwood has also taken measures that enable it to handle the challenges
that are associated with the high season.
Starwood is able to retain the customers it has as they are able to have
high quality services accompanied with lower rates and costs.
By adopting the mixed strategy the organization is able to handle the
dynamics that are associated with the hotel industry.
Strategy of Starwood

7. Starwood experiences staffing disparities that are associated with
opening a new hotel and staffing an already existing one.
For a new hotel, Starwood would be compelled to make estimations
during planning of the number of staff it would require.
Starwood has verse experience in the industry and has operation of
different hotels it would not be very challenging to determine the number of
human resource that would be required for a new hotel.
 Records and data that can be useful for Starwood in determining the
number of staff would be; the size and complexity of the new hotel
compared with the existing hotels.
New Hotel or Resort Staffing

8. Recommendation
Starwood is branded hotel. It should invest in activities that facilitate the
achievement of sales targets to compete with other organizations in the
hotel industry.
 It should realize the expected sales, required operations and should plan
prior to the implementation activities.
Starwood as a reputed hotel in the hotel industry it should be able to
maintain the existing customers and put much of its focus in acquiring new
potential customers.
Some of the marketing plans that should be considered by Starwood
include conducting massive promotions and advertisements for its
products.

9. Strategic Capacity Planning
for
Products and Services

10. Capacity:
Amount of output a system is capable of achieving over a specific period
of time.
Capacity planning:
Capacity planning is central to the long-term success of an organization.
Capacity plans are made at two levels:
(i) Long-term capacity plans :
Which deal with investments in new facilities and equipment's covering the
requirements for at least two years into the future.
(ii) Short-term capacity plans :
Which focus on work-force size, overtime budgets, inventories etc.
What Is Capacity?

11. A long term strategic decision that establishes a
firm’s overall level resources.
Three major capacity decisions are:
i. How much capacity to be installed
ii. When to increase capacity and
iii. How much to increase
Capacity Planning

12. Design capacity
Design capacity refers to the maximum designed
service capacity or output rate.
maximum output rate or service capacity an operation,
process, or facility is designed for.
Designing Capacity, Effective
Capacity and Actual Capacity

13. Effective capacity
Effective capacity is the maximum amount of work that
an organization is capable of completing in a given
period
Actual output
 Rate of output actually achieved--cannot
exceed effective capacity due to constraints such as
quality problems, delays, material handling etc.

14. Economies scale:
The concept which states that “the average unit cost of product can
be reduced by increasing the rate of output”.
Economies of scale is the cost advantage that arises with increased
output of a product.
Economies of scale arise because of the inverse relationship between
the quantity produced and per-unit fixed costs;
The greater the quantity of a good produced, the lower the per-unit fixed
cost because these costs are spread out over a larger number of goods.
Economies and Diseconomies of Scale

15. Diseconomies of scale:
Diseconomies of scale occur when, as a business expands in the long
run, the unit cost of production increases.
Diseconomies of scale is an economic concept referring to a situation in
which economies of scale no longer functions for a firm.
With this principle, rather than experiencing continued decreasing costs
and increasing output, a firm sees an increase in marginal costs when
output is increased.
Diseconomies of scale can occur for various of reasons, but the root
cause usually comes from the difficulty of managing an increasingly large
workforce.

16.  Estimate future capacity requirement;
 Evaluate existing capacity and facilities and identify gaps;
 Identify alternative for meeting requirements;
 Conduct financial analyses of each alternative;
 Assess key qualitative issues for each alternative ;
 Select the alternative to pursue that will be bests in long term;
 Implement the selected alternative;
 Monitor results.
Steps in the Capacity Planning
Process