RLS 3654 Economy in Tourism Industry

APPLIES TO ACADEMIC YEAR 2012/2013

RLS 3654 Economy in Tourism Industry Responsible for the course Emanuel Blattner Department Department of Accounting - Auditing and Law Term According to study plan ECTS Credits 7,5 Language of instruction Norwegian Introduction Economy in the tourism industry is a part of business economics, which consists of knowledge achieved in managerial economics, finance, accounting, microeconomics and statistics. The service industry is facing a tremendous challenge in managing capacity profitably. The aim of the course is to improve the students’ knowledge and skills in business economics with special focus on revenue management. Revenue management can help a firm sell services to the right type of customers, at the right price and at the right time. Yield management guides the decision of how to allocate undifferential units of capacity to available demand in such a way as to maximize profit or revenue. The course includes a hotel management simulation. The simulation allows the student to apply theoretical knowledge in an environment very close to reality. Learning outcome Acquired knowledge The course is divided into two parts: Part 1 After taking the course, the students shall be able to explain key concepts and give an account of the tools used in analyses of business economics problems in the tourism industry with a main focus on revenue management. Examples of concepts are: Price decisions in the services industry To develop logical pricing policies which take into consideration the willingness of payment among the customers Time-variable demand Taking price and revenue decisions by using models of yield management Appropriate cost structure Part 2 In part two the students will participate in a management game in the hotel industry. The use of management games allows the students to improve and apply theoretical knowledge in yield management. Examples are: Apply models and methods of yield management in revenue management Profit, liquidity and balance planning and budgeting Analyse investment problems in the management game Acquired skills After taking the course, the students shall be able to (a) apply knowledge (i.e. concepts and skills) in analyses and discussions on yield management problems, (b) distinguish between relevant and irrelevant information, and (c) give written answers to questions so that the readers understand the applied methods and conclusions. Examples: Apply the theory of marginal revenue and marginal cost Estimate the optimal price mix by using historical observations Prepare yield management strategies Apply models of yield management in the services industry Reflection After taking the course, the students shall be able to ask critical questions and reflect on crucial assumptions and theories within the business economics field and in particular the yield management field. Prerequisites Knowledge equivalent to the 2nd year of the Bachelor of Business Administration Program in Tourisme Compulsory reading Books: Ingold ,Anthony, Una McMahon-Beatti and Ian Yeoman, eds. 2000. Yield management : strategies for the service industries. 2nd ed. Continuum Recommended reading Books: Tranter, Kimberly A., Trevor Stuart-Hill, Juston Parker. 2009. An introduction to revenue management for the hospitality industry : principles and practices for the real world. Pearson Prentice Hall Other: Erik Bergman. 2010. Brukermanual til Hotcalc simuleringen Course outline Part 1 The principles of yield management A strategic approach to yield management Economic aspects of pricing in the tourism industry Legal aspects Appropriate cost structure Models of yield management Perspective on pricing decisions in the hospitality industry Model to evaluate revenue and loadings for intercity Yield management models in the inclusive holiday industry Decision-making by means of yield management models Cases Part 2 Management game "Hotcalc" The students shall be able to apply knowledge achieved during part 1 Revenue management in a competitive marked Revenue and cost analysis Allocation of undifferential units of capacity to available demand in such a way as to maximize profit Strategies in the management game using yield management The use of yield management models in decision-taking Computer-based tools Management game "Hotcalc" Learning process and workload The course includes 30 hours lectures, and 15 hours case studies and management game conducted by the lecturer. Recommended use of hours: Activity Hours Lectures 30 Casestudies 15 Reading literature and preperation for lectures 151 Final examination 4 Total use of hours recommended 200 Case studies and management game are conducted by the lecturer Examination A four hour individual written examination concludes the course. Examination code(s) RLS 36541 Written examination. Counts 100% towards the final grade in RLS 3654, Economy in Tourism Industry, 7,5 credits. Examination support materials Only Calculator TEXAS INSTRUMENTS BA II Plus™ is allowed. Exam aids at written examinations are explained under exam information in our web-based Student handbook. Please note use of calculator and dictionary. http://www.bi.edu/studenthandbook/examaids Re-sit examination A re-sit in Written examination is held every term. Additional information

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