"Every question we answer leads on to another question. This has become the greatest survival trick of our species."

Desmond Morris - The Naked Ape

hospitality resources

Capital versus Current Expenditure - a hospitality industry perspective
By Dipankar Mukherjee, CHAE, CMC

It is common knowledge that certain expenditures treated as expenses for accounting purposes need to be reclassified as capital outlay for tax purposes. These costs are then allowed to be deducted from income over a certain period of time as Capital Cost Allowance under the Canadian Income Tax Act (hereafter referred to as “the Act”). ¹ The issue stems from the definition of the term “profit”. Court decisions in Canada have indicated that “profit” under GAAP (generally accepted accounting principles) is not necessarily the same as “profit” under the Act. The argument is that an accountant may be motivated by a desire to present a conservative picture whereas the Act is motivated by a desire to raise public revenue. Law and not accounting principles govern “profit” under the Act. Read the complete article or download a PDF version

Strategy and its Execution – a hospitality industry perspective
by Dipankar Mukherjee CHAE, CMC

At a recent presentation of the Southern Alberta Chapter of HFTP a concept called “A Healthy Scorecard” was introduced. The speaker tried to link health related issues with “The Balanced Scorecard” emphasizing why this relationship was important for sustainable corporate “strategy”. Attendees to the presentation came from restaurants, independent hotels, corporate chains, full-service properties, limited service properties, hotel sales departments - in short, quite a diverse group. Following the presentation a survey was conducted to find out from the attendees about their perspective on “strategic positioning”, their understanding of “The Balanced Scorecard”, what they considered to be the most important variable influencing “strategy”, what were the biggest threats to strategy, among other questions.
All respondents were of the opinion that “strategic positioning” was extremely important for long-term success of an organization. Based on such a feedback it could be inferred that the hospitality industry professionals are realizing the necessity of an overall planned approach to move forward.
It appears that the industry is beginning to realize the importance of a strategy-focused organization.
However business success is not achieved only through brilliant strategy. It is achieved through the brilliant execution of strategy. The Balanced Scorecard is a tool that facilitates such execution. About half of the respondents were not aware of this concept. This warrants some discussion of the concept. Read the complete article or download a PDF version

Value Based Management
This spreadsheet provides an example of a Free Cash Flow Model. It goes to show that owner’s wealth does not necessarily increase with sales growth or net operating income growth (accounting measures). The model shows that even in a no sales growth situation owner’s wealth is higher than what was observed in a growing sales projection.

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It also means assisting Hilton in maintaining its strong position in technology related areas such as front office, food-and-beverage, telecommunications, engineering, housekeeping, safety and security, as well as ensuring that all departments of all brands work together to create value and meet the goals set for them. That’s where Enterprise Performance Management (EPM) comes into play. Read the complete article   (reprinted with permission from HFTP)

Hospitality E-Business: The Future - by Roger S. Cline and Dr. Mark Warner
As the hospitality industry continues to embrace electronic forms of doing business, from the way rooms inventory is distributed to purchasing online goods and services, tradition-bound attitudes are changing in this sector as rapidly as the technological enhancements that mold them. The context for e-business in hospitality is a challenging one but the future is bright as revenue yield and labor productivity improvements begin to have an impact on the bottom line. Hospitality e-business is not only here to stay, but destined to play an increasingly significant role in the way the hospitality business is conducted in the future. Read the complete article   (reprinted with permission from HFTP)