EFFECTS OF APPLYING BPM CRITICAL PATH AND STATISTICAL PERT ANALYSIS ON CFM PRACTICES AND PROFIT MAXIMIZATION IN HOTEL INDUSTRY

Abstract

Purpose – The study aims to improve management practices of accounts receivable and payable as a necessity for improved financial performance of hotel enterprises using BPM approach and focusing on applying CPM and statistical PERT analysis to financial processes in order to increase CFM efficiency and maximize hotel`s profit. Design/methodology/approach – The methodology of this research begins with a review of BPM theory and both of CPM and PERT analysis literature studies. Then, the paper focuses on applying the theory on a real-life case of 9 international chain five-star hotels in Egypt using a semi-structured interview technique. Findings – The paper develops a generic framework for hotel financial processes using BPM approach to improve the structural configuration of SOPs in the hotel sector. Utilizing CPM and statistical PERT analysis, hoteliers can enhance their understanding of financial processes by entering CPM and PERT analysis into BPM procedures which make process measurements can be made in a proper sense and process deficiencies can be identified, and thus corrected more quickly. Practical implications – In light of these findings, the paper discusses the practical implications and focuses on recommendations on how the two main components of CFM in the hotel sector are to be managed in a more effective way using BPMCP and statistical PERT analysis. Originality/value – The paper presents CPM and PERT analysis as an integral part of BPM approach and suggests recommendations that will assist to recover the problems of credit collection delays and eliminate deficiencies of CFM practices in hotels. There are also future research recommendations to enhance the knowledge of CFM practices in the hotel sector.