The Quality and Supply Chain Management of Airbnb

Executive Summary

This paper analyses the quality and supply chain management of Airbnb, a hospitality organisation. It is divided into two parts. The first part contains two topics: quality management and supply chain management. The topic of quality management includes a definition of quality, characteristics and dimensions of quality, and total quality management of Airbnb. The second topic contains the supply chain management, stages of SCM for Airbnb, and the lean vs agile approach. The 2^nd part of this report contains two issues for Airbnb-Security and safety and customer services. These issues are presented to the operation manager and marketing managers to handle these issues to sustain the growth of the company.

Introduction

Since its inception in 2007, when two Residents in San Francisco greeted three Guests into their residences, Airbnb has expanded to include over 4 million Hosts and over 1.4 billion Visitor journeys in practically all countries worldwide. Every day, Hosts all around the world interact with travellers by providing accommodations as well as one-of-a-kind experiences. Airbnb, Inc. runs a website where people can list and find lodging. The business enterprise offers a portable program (app) that facilitates the advertising, finding, and reserving one-of-a-kind lodgings worldwide. Co-founder and CEO Brian Chesky are responsible for the organisation’s overall direction and strategies (Midgett et al., 2018). The Gebbia brothers, Brian and Joe, founded Airbnb in 2007. One can reserve lodgings using Airbnb, an internet service. Airbnb is best known for letting people rent out entire houses for vacations, but it also allows people to reserve accommodations, individual spaces, and collaborative rooms. Airbnb has become so popular because it delivers a marketplace where homeowners can list their properties for rent by vacationers. This will allow individuals to spend less on hotels while enjoying customised stays. One who contributes to Airbnb’s bottom line is considered a customer. Either he is a host who publishes his available room on the website or a guest who employs the site to locate a place to stay. As of September 2020, Airbnb had 5.6 million listings on its platform in 220 nations and areas. This signified unprecedented growth for the company, which launched in 2008 (Kurt,2014). The first part of this report will analyse the quality management and supply chain management of Airbnb, and the second part will describe two issues for the operation manager that need to be addressed and discussed with the marketing manager.

TASK-1

Topic-1: Quality Management

Definition of Quality

The term “quality” refers to all the aspects of a good or service that contribute to its suitability for a certain purpose (Slack & Brandon-Jones, 2019). Managing quality is keeping an eye on all that must be done to perform at a high standard. Determining an effective quality policy, developing and executing quality preparation and monitoring, and carrying out quality control and enhancement are all part of quality management. To achieve TQM, businesses must have buy-in from all employees, customers, suppliers, and other interested parties.

Importance of Quality for Airbnb

The ability to pay attention is essential in the hospitality industry (Aznar et al., 2018). One should do more than just hear what has been stated. But listen carefully so it can grasp both the words and the silences. Employees in the hospitality industry must have excellent comprehension abilities. It reduces operational expenditures by Incorrect services usually come with hefty price tags. If room service mistakes an order, for instance, the hotel will be responsible for rectifying the situation and any associated costs (Dahlgaard et al., 2018). In contrast to other technical fields, the hospitality industry is essentially a “people business.” It depends on numerous core principles of hospitality, including the ability to provide excellent service, foster positive connections with customers, and reward their loyalty.

Dimensions and Characteristics of Quality

1. Performance

It’s no secret that people rely their impressions of the superiority of a service largely on how well it performs, making performance a crucial quality indicator (Zhang,2013). When talking about the hospitality industry, “performance” typically refers to how quickly and kindly problems are resolved.

2. Features

In terms of performance, features are frequently considered the second level of quality. Providers of airline services, for instance, can boost their attractiveness by providing passengers with free alcoholic beverages.

3. Reliability

The degree to which the product will perform as intended and how likely it is to break down or defect within a given time frame are both factors that contribute to this aspect of quality. Assistance like website and blog management is one example. The most trustworthy hosts are those with the lowest rate of downtime.

4. Conformance

A capability of conforming to norms suggests that they can be met. Conformance refers to the extent to which a product’s specified design and performance characteristics satisfy the specified requirements.

5. Durability

The lifespan of the item or service is a good indicator of durability, another quality aspect. It’s important from a financial and technological standpoint (Zhang,2013). Customers should consider the pricing and ongoing maintenance costs of a newer, more dependable model compared to the anticipated cost of future repairs.

6. Serviceability

Serviceability, which refers to the convenience of maintenance or replacement, is the sixth pillar of quality. Repair ease is important, as are promptness, politeness, and expertise. Customers want to know how long it will take to get their services back online if something goes wrong with the product or service.

7. Aesthetics

When it comes to aesthetics, everyone has their own opinion and standards. A consumer’s reaction to a product’s aesthetics, texture, sound, flavour, or aroma is subjective.

Total Quality Management of Airbnb

Total Quality Management (TQM) is a strategy for achieving sustainable success by providing consistently high-quality information technology (IT) operations to an organisation’s clientele. Airbnb’s approach to total quality management (TQM) concentrates on meeting guests halfway between their high standards and their impressions of the service they obtained. In order to bridge the gap between what was promised and what was delivered, hotels need as much information as possible from their guests. Since the customer is the most significant component of any business, total quality management (TQM) in the hospitality industry is a collaborative approach that encourages workers at all levels to form teams to initiate guest service expectations and identify the best method to meet or exceed these expectations (Aznar et al., 2018). Airbnb needs Total Quality Management (TQM) for assistance in helping them manage better and boost staff output, both of which would improve the quality of the tourism industry as a whole.

GAP Theory for Airbnb

Service providers can assess where they are in terms of customer satisfaction by using the gap model of service performance. Every business, whether primarily a retailer or a service provider, must deal with customers in some capacity (Amore et al., 2022).

1. Management’s view vs customer’s view: a gaping chasm

The extent of this discrepancy indicates how far management is from the truth about what consumers seek. This may arise if management does not have an adequate understanding of the needs of its clients.

2. Contradictions between what management thinks and what is required to provide high-quality service

This gap analyses the disjuncture between management’s ideals and actual practices in delivering quality service.

3. Deficiency in providing the level of service that was promised.

This disparity measures the discord between management’s stated service expectations and the actual service provided to customers.

4. There is a disconnect between internal operations and external communication.

The analysis of this chasm involves comparing the service a firm advertises to its customers with the service they ultimately experience (Amore et al., 2022).

5. The disparity between service expectations and actual service received.

This divide bridges the gap between customers’ ideal service and their experience.

Airbnb closes Gap 1 with the use of surveys and feedback from customers and Gap 2 with internal training and communication. The third gap is closed by constant tweaks and checks on existing processes. Consistent two-way contact with clients and collaborators is implemented to close the fourth gap. Continuously improving procedures and execution of services helps close the fifth gap.

Topic-2: Supply chain management

Supply Chain Introduction

Management of materials and resources from the point of origin to the end outcome is the focus of supply chain management (SCM). SCM is relevant to any business that manages initiatives, manufactures products, or delivers services, as these necessitate a reliable supply chain. Supply chain management is becoming increasingly crucial in today’s growing competitive hospitality industry (Chen et al., 2021). Supply chains improve efficiency and collaboration for an organisation as large as an association of hotels, allowing them to deliver individualised services to their guests. Supply chain management is essential to Airbnb’s business model because it entails finding and keeping track of the lodgings and services hosts deliver.

Stages of Supply Chain

The hotel sector places a premium on efficient logistics and supply chain management. SCM, or supply chain management, is essential in the hospitality business.

• Planning

Planning encompasses several different actions. The first step for businesses is to determine their operational strategy. It’s important to weigh the pros and cons of manufacturing and sourcing before making a final decision. Establishing production volumes, deciding on inventory storage needs, and outlining logistics for moving goods from one location to another are all part of the planning process. Examining the worldwide supply chain and its governance operations to find ways to enhance them is also part of this. In the preparation phase, Airbnb determines how it will run, down to the smallest detail (Barron et al., 2019). This includes everything from the distribution of resources to inventory control and demand projections. The corporation relies on data analytics and computers to provide accurate demand predictions and fine-tune pricing policies. The deployment of the company’s employees is also planned, with special attention paid to the customer service, marketing, and operational departments.

• Sourcing

In this facet of supply chain management, the process of acquiring materials and parts is planned and coordinated. It is necessary to evaluate supplier performance and make timely payments to vendors. Companies may use supply chain networks in certain circumstances. This will entail coordinating with this system, overseeing stock and assets, and seeing that import and export norms are adhered to. Airbnb relies on homeowners and collaborators to provide its guests with lodging and other services. Finding and screening possible hosts and collaborators, agreeing and finalising agreements, and ensuring they meet Airbnb’s quality requirements are all part of the job.

• Making

Production planning, evaluation of goods, quality assurance, packaging, and shipping all fall under this phase’s purview. The organisation also oversees performance regulations, data archiving, infrastructure maintenance, and government mandates. Airbnb runs its business, which includes taking reservations, processing payments, and overseeing the upkeep of lodgings and services (Roussat et al., 2023). The website acts as a meeting place and exchange for hosts and visitors. Airbnb handles everything from visitor authentication and settlement of payments to host-guest interactions.

• Delivery

Every action taken after a consumer inquires and before delivery is complete is part of the delivery phase. Businesses must either handle their storage and inventory or hire a third party. There may be a trial period or warranty, and sales outlets or customers must be charged and paid at this point. Finished services may have import or export stipulations that businesses must manage. Guests of Airbnb receive the lodgings and services they have requested (Roussat et al., 2023). The organisation offers various services, such as maintenance and cleanliness, key oversight, and suggestions about the area to guarantee visitors a pleasant stay. Airbnb also gathers and analyses visitor feedback to ensure their services’ quality remains high.

Lean vs Agile for Airbnb

In supply chain management, Airbnb might benefit from adopting Lean and Agile practices. Using Lean, Airbnb may be able in order to safeguard costs and accelerate the speed of delivery by reducing waste in the supply chain. At the same time, Agile might be utilised to create processes for supply chains that are more adaptable and reactive, permitting them to adjust to changing marketplace dynamics and evolving consumer preferences. Two popular approaches to project management and continuous improvement are Lean and Agile.

“lean logistics” aims to maximise efficiency (Balog, 2020). Waste in the hospitality business can be reduced using several methods, such as “First in, first out” (FIFO), computerised ordering, accurate forecasts, faster deliveries, etc. This is vital for the hotel business as bookings and demand are often unpredictable. Applying lean principles could benefit Airbnb’s host registration and listing management procedures. Booking information should be contained in a streamlined ordering system, one way Airbnb may boost productivity. Waste can be reduced with the use of historical records. Collaboration between hotels, even those in direct competition, can help reduce waste.

The agile methodology could provide updated functions for Airbnb’s mobile and internet-based platforms. Airbnb may provide fresh functions that more closely suit the demands and desires of its consumers by dividing the design procedure into smaller stages and collecting suggestions from consumers along the way. Airbnb’s customer care department might benefit from adopting agile practices (Balog, 2020). Airbnb may enhance the promptness and excellence of its customer service and decrease the risk of criticism from clients and negative feedback by cutting down its client assistance procedure into smaller increments and receiving input from consumers along the way.

Task-2

2 Issues for Airbnb

• Keeping hosts and visitors safe is a top priority for Airbnb but is also one of the company’s biggest hurdles. The recent COVID-19 outbreak has only served to heighten already-present concerns about the state of hygiene and sanitation in the world. The CDC and the WHO have guided the development of the Health Safety Attestation, which is centred on a similar instrument implemented in stages. A recent poll found that 44% of respondents prioritised safety and health considerations when choosing a lodging option for their upcoming trip, a trend that may continue in the following one as individuals intend to travel more frequently to reconnect with loved ones (Krouk & Almeida, 2021). The term “hospitality security” refers to those who oversee safety measures in the hospitality industry, including hotels, motels, entertainment venues, and the tourism sector.
• Regarding safety, the hospitality industry might benefit from tried-and-true problem prevention and resolution strategies. In order to ensure that Airbnb’s promotional activities align with the company’s existing safety and security measures and programs, such as screenings for hosts and guest identification verification, the operations manager might like to have a conversation about these topics. In addition, Airbnb’s operations officer and marketing coordinator may wish to investigate innovative approaches to reassuring clients of the company’s dedication to their security, such as specific promotions or collaborations with established travel businesses.

• Operations and marketing managers should frequently confer on how their respective departments are improving the company’s focus on its customers. The accomplishments of Airbnb are predicated on its ability to offer its consumers a one-of-a-kind and customised vacation experience. Serving customers well is essential in the hospitality industry. Though typically restricted and centred on visitors. Every host is responsible for being reactive and proactive when responding to guests’ needs, yet this research suggests that guests are far more inclined to recall unpleasant than pleasant experiences (Amore et al., 2022). A superb visitor book with emergency phone numbers, restaurant suggestions and the lodging manager’s contact information will help you prevent negative feedback and provide a positive, proactive visitor experience. The little things, like providing a high-quality cleaning kit for visitors, make a difference. When hosts provide convenient access to cleaning materials, visitors are likelier to pitch in with the cleanup. The ops manager may stress the value of happy guests and the role that marketing plays in convincing customers that they’re important to Airbnb. It’s possible that the operations manager is also interested in sharing their vision for enhancing productivity and flexibility to client needs through initiatives to enhance the customer service they provide. Guest reviews that are constructively critical are negative; violent ones are ambiguous, illogical, or profane. When guests’ ideal vacations don’t pan out, they’re more likely to complain, and if the problem isn’t fixed, the hotel is more likely to get a bad review or, even worse, a customer complaint.

Conclusions

Costs connected with not meeting the market’s needs, such as consumer discontent and low sales, can be avoided through quality management. The ability of a corporation to adapt to the needs of an ever-evolving market depends on the degree to which its procedures are flexible. To ensure that guests and hosts are whom they say they are, accommodations must be inspected and their features thoroughly described before they are listed on the site (Dahlgaard et al., 2018). Through quality management, businesses can boost their wares’ consistency, longevity, and efficacy. All of these things make a company stand out from its rivals. The higher the quality of the goods, the more satisfied the buyer and the greater the profit. Keeping the correct amount of stock on hand can save overhead expenses, save on storage space, keep ordering prices low, and keep production running smoothly. Before declaring the SCM model a success, businesses must verify that it has been properly implemented. Successful supply chain management may boost profits, make consumers happier, shorten the delivery duration, and strengthen supplier relationships (Slack & Brandon-Jones, 2019). Airbnb can guarantee a consistent supply of high-quality lodgings and services for its clients because of its meticulous supply chain management. In general, Airbnb’s supply chain management is a major factor in the company’s accomplishment because it enables it to address customer demand for unique and individualised vacation experiences without compromising effectiveness or sustainability.

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