Thousands of activities are performed and coordinated within an organization, and every
company at least one supply chain relationship with another organization. Research has led
to the conclusion that the structure of activities within and between companies is a critical
cornerstone of creating unique and superior supply chain performance (Lambert, 2005).
Successful supply chain management requires integrating business processes with key
members of the supply chain, because valuable resources are wasted when supply chains
are not effectively managed. Standard business processes enable managers from different
organizations in the supply chain to use a common language and link-up their
organizations processes with other members of the supply chain.
Demand management is the supply chain management process that balances the guests
wants and needs with the capacity of the supply chain. Management can match supply with
demand and have few disruptions if the appropriate process is already in place. The
process is not limited to forecasting, but also includes matching supply and demand and
increasing flexibility. An effective demand management system uses any available data to
reduce uncertainty and provide efficient flow throughout the supply chain. Marketing
requirements and production plans should be coordinated on a corporate level, so that
multiple vendors are not delivering the same products for different prices to each hotel
location. Instead, cost savings can be found in consolidation of orders.
Supplier relationship management is the process that defines how a hotel interacts with its
suppliers. As the name suggests, this is a mirror image of guest relationship management,
because a hotel needs to foster relationships with its suppliers too. As in the case of guest
relationship management, a hotel will forge close relationships with a small subset of its
suppliers, and manage arm-length relationships with others. A contract is negotiated with
each key supplier that defines the terms of the relationship. For segments of less critical
suppliers, the contract is not negotiable. Supplier relationship management is about
defining and managing these contracts. Long-term relationships are developed with a small
core group of suppliers. The desired outcome is a win-win relationship where both parties
benefit.
Guest relationship management provides the structure for how the relationships with
guests will be developed and maintained. Management identifies key guests and guest
groups to be targeted as part of the hotel mission. The goal is to segment guests based on
their value over time and increase guest loyalty by providing customized products and
services. The Director of Sales works with key guests to improve processes, eliminate
