Hilton and Holiday Inn Human Resource strategy and Operational planning
The essay will explore the theoretical and practical sides of the relationship between the Human Resource strategy and the Operational planning and development in the retail and hospitality industry, in order to determine a deep overall view of the subject. The text will draw upon many cases, research, and literature to demonstrate the background that is necessary for an independent evaluation of this topic. The paper will take Hilton and Holiday Inn as an example of today’s average but highly successful corporation and investigate the company’s past and current human resource strategies and the reasons behind their strategic decisions. Through the essay; human capital management, business performance, model of comparative SHRM, strategy evaluation, HR links between missions, as well as goals of the organizations and further related topics; will be discussed. The essay is divided by nine major topics. Certain topics will be examined in greater detail for more accurate understanding, however as SHRM indicates every topic will also deeply link together and therefore specific parts on certain subjects will be discussed in other topics.
SHRM can be defined as the connection between HR, strategic objectives and goals in order to increase productivity or efficiency and create business culture that promotes flexibility, innovation, and competitive advantage. In a corporation, Strategic Human Resource Management means accepting and involving the Human Resource roles as a strategic partner in the formulation and implementation of the organisations strategies through Human Resource functions such as staffing, selecting, training and rewarding employees. (Mello, 2010)
Recruitment linked with operational strategy
The first area of focus is on the process of accurate staffing, management, and organisation of a business through human resource functions. Businesses are able to create a highly effective strategic framework as it will be uniquely personalised for their exact situation. This is by recognising the portfolio of the corporation at the operational, managerial and strategic level, rather than arranging the human resource department to reflect the strategic, managerial and operational requirements of the organisation (Hamel and Prahalad, 1996: 242). The most important structural variations of the corporation also stand on the corporations recruiting procedure. Position posting, succession forecasting and management development offer the HR department a chance to bring a measure of integration to the recruiting procedure and to have power over the internal movement of the corporations human resources. It is especially significant that staffing for all levels of positions, as well as the domestic movement of employees, be coordinated with the strategic concerns of the business (Baron & Kreps, 1999). The portfolio of the business will make a significant input to the progress of a businesses recruiting strategy; it is one of the driving forces in the staffing, promotion plans & program development and selection. Management between the businesses recruiting and its strategic plans can improve the businesses ability to get used to environmental conditions. However businesses are likely to recruit people who have similar characteristics to the managers who are presently working within it. “Little conscious attention is paid to identifying the characteristics most congruent with different organizational configurations.” (Galbraith and Nathanson,1978).
Employee skill and behaviour training
Many businesses, including local shops in Edinburgh owned by the Asian community, have faced the challenge of developing greater confidence, solution finding, initiative, and trouble solving capabilities among their employees. This has become a serious problem (Megginson & Banfield & Matthews, 1999) as those convenient stores are the backbone of the economy (Dr. Welsh, 2000). Businesses need employees at every level to be more resourceful, independent, creative and self sufficient. These characteristics allow employees to function at a superior strategic level, making businesses more competitive and productive. Therefore, they require training & development which includes all activities intended and executed to support staff members knowledge, abilities (or “competencies”) and skills. For organizations, training and development especially relates to those activities that make sure that every staff member is capable enough to build a work environment that is both inclusive and diverse. In addition to supporting abilities, skills and knowledge; several training and development plans associated with diversity efforts to influence the attitudes, maturity, courage or values of their members, are also necessary for the development of strategic and managerial capabilities. It should be noted that training and development plans that try to make major adjustments with regard to attitudes need a large amount of time and investment if they are to be successful. However each individual training undergone is a kind of long term investment, therefore determining the return on investments when conducting training and development activities, are very important. There are several kinds of training options. Mentoring, Coaching and Counselling are the most well known ones. Although many of the methods are similar within these training options as they are normally delivered by individuals, there are numerous unique characteristics of each method that make them exclusive in their own way other than the fact that the individual has different qualifications, different relationships with their client and is usually working within different time frames (Megginson, Banfield & Matthews, 1999)
As it has been mentioned earlier, companies try to train their staff to be more self-sufficient so that less supervision would be required; or in other words, empower them. Employee empowerment is an expression used to express the ways in which employees without managerial positions can make independent decisions with no need of confirmation from a boss or manager. These independent decisions can be small or large depending on the level of power with which the organisation wants to invest in the member of staff. Personnel empowerment can start with training, as stated above, and by converting a whole business into an empowerment model. On the other hand it may simply mean giving staff members the ability to make a few decisions on their own. When people feel they have options and are allowed to make direct decisions, this does frequently show the way to a better feeling of self worth. In a representation where power is directly attached to a sense of self, the feeling of having some power is a priceless thing (Losey & Ulrich & Meisinger, 2005). A staff member who does not feel continuously evaluated by managers and watched is more likely to consider their workplace as a positive, happy environment, rather than a negative one.
The behavioural research, carried out by a group at Massachusetts General Hospital and Harvard University, recognizes the aspects that most possible to affect 21st century staff well being, productivity and commitment. (PhD. Kreisman, 2002). They established that loyalty is mainly influenced by one’s sense of purpose, general trust in the business and feeling of individual impact. Productivity is mostly affected by the quality of human relations including social group moods, cooperative and interaction. The results of the investigation guided them to conclude that working environments that offer positive atmosphere that encourage quality personal relationships and interpersonal trust generates the most loyal and productive staff members. So a staff member who does not feel continuously watched by managers is more likely to judge their workplace as a positive environment, as it has been said before, therefore he or she will feel more committed to the organisation. This would increase their productivity, as people’s efforts generate greater results. In conclusion, this would cut cost for the organisation. (Losey & Ulrich & Meisinger, 2005)
Last year a much respected five star Hilton hotel recruited front line staff for part time positions. From week one Hilton’s management required them to work 65 hours even when indeed they had a contract for 25 hours per week. They were unable to do anything about this unfortunate situation as it was clear that if they could not fit their schedules they were free to leave. By the end of the 3rd month when their training had finished, many of them were exhausted and fed up, and they left the Hilton group for their leak of flexibility (Mehta, 2005). Flexibility is essential for both the employer and the employee; flexibility of staff member behaviours, workers skills and Human Resource practices stand for a significant sub dimension of Human Resource flexibility and are associated with greater business performance. Results based on perceptual methods of Human Resource flexibility and accounting measures of business performance support this prediction. Behaviour, skill, and Human Resource practice flexibility are, however, drastically connected with an index of business financial performance. Numerous professionals believe that the only skill that flexibility contributes is its cost efficiency. (Hendry, 1995) Hilton has recruited them because they were looking for people who “go the extra mile”; people who are flexible. The fact that Hilton did not give anything to them in return meant that these people left. Despite this, their worth and value has increased as the result of the training that Hilton gave them, while Hilton lost a significant amount of money. In the Hospitality business, staff turnover is the biggest problem because in the service industry, staff represent the biggest cost and long time investment at the same time. This means that when companies start to train their staff they integrate them into the business even if they are not core employees. When they leave however, all the money and time put in will be lost, not to mention the cost of the ongoing posting of jobs, interviews and other administrational fees (Hayes & Ninemeier, 2008).
Human Capital versus SHRM
A several authors have argued that SRHM and Human Capital Management are the same thing. Certainly the idea of SHRM matches that of the broader meaning of HCM relatively well; as the following characterisation of the key features of SHRM by Dyer and Holder (1998) demonstrate that strategies engage decisions regarding main policies, key goals and the allowance of resources that are likely to be formulated “at the top”. Strategies are business determined and focus on organisational efficiency; thus in this perspective, are viewed mainly as resources to be managed toward the success of strategic business targets (Society for Human Resource Management, 2004). Strategies by their very nature offer combined frameworks which are at once integrative, broad and possibility based. These integrate a full complement of Human Resource targets and activities intended exclusively to fit existing environments and to be equally reinforcing or synergistic. This sections discussion has been based on the evidence that both Human Resource Management in its appropriate sense and Human Capital Management, rest on the supposition that employees are treated as assets rather than expenses and both focus on the significance of adopting an incorporated and strategic move towards managing employees which is the worry of every stakeholder in a business, not only the staff management function. On the other hand, the theory of HCM strengthens and complements the theory of SHRM rather than replaces it. Therefore both Human Capital Management and Strategic Human Resource Management can be considered as crucial components in the progression of staff management and both form the basis for accomplishing HR advantage through a resource based strategy (Greer, 2000).
Soft HRM versus Hard HRM
The effort to satisfy external stakeholders and the costumers demanding nature lead to a pressure on HR management both strategically and operationally side. (York, 2009) Customer service and associated perceptions have led retail businesses and hospitality to a more theoretical judgment of HR management. In the long term it is left to be seen whether the strategic management of HR has been better regulated by hard Human Resource Management, which is the traditional managerial distrust approach. Humans are lazy by nature and simply pursue their self-interests. This means that there are two different and conflicting sets of interests: the organisation and its employees. It is the managements job to encourage the right attitude in staff members so that their actions pursue the accomplishment of the organisation’s goals, not their own. Thus there is a case for the existence of “correctives” and “coercion”. (Megginson 1999), On the other hand there is the soft Human Resource Management or in other name the Harvard model which is the opposed approach. Instead of seeing humans as lazy machines, they are seen as able to take care of their feelings, emotions and motivations. Employees might in fact wish for personal realisation and work could be one of the ways to achieve it. People like things done well, and making a difference. Managers therefore, must allow them to do so and help them to maintain their high levels of motivation. Employees are not lazy, they do not hate working, and can be self responsible. In this way, coercion is no longer essential (Megginson 1999).
Customer Service, (linking)
Mayfair London located at the centre of the British Tourism Hospitality Industry and Bass group is a primary hospitality chain. Johnson (1999) examines that the senior managers at Holiday inns carried out a training project that included spending short times at operative levels. This training led them to discover that if front line employees were not given autonomy and authority to solve non routine issues as they came up, “their customers” belief of quality service would be badly damaged. It is significant to identify the connection between the front line staff, executives and the empowerment of employees to take liability for quality management problems and customer care satisfaction. The corporation then initiated training programs to provide employees with the possibilities to take further liability for problem solving and quality as well as implement new employment strategies, for example “auditions” for front office staff to differentiate applicants with the “right attitudes”. The term “right attitudes” suggests that the organization is seeking employees with culturally specified social skills, “attributes” that are frequently difficult to appraise. These “tacit” or “soft” abilities, are skills to carry out complex functions and relationship roles while at the same time, carry out technical (or “hard”) tasks. (Hayes & Ninemeier, 2008). Executives also accept that the success of the new strategies would give a genuine dedication to the interests and welfare of staff. The hotel gained “Investors in People recognition” in 1995. This section is an excellent example that shows how everything is linked together. The essay previously discusses empowerment, flexibility, commitment, training, customer service and many more things, as this example states; every single area of human resource management effects the entire business progress just as much as one area effects another.
Business or corporate strategy for service companies in areas such as tourism, hospitality and retail; has to satisfy a variety of stakeholders, and interests them within a strategy framework appropriate to all of them. SHRM has played a part in the consolidation of staff members, within the model established by the executive senior managers. Strategic Human Resource Management is therefore a component of the wider network of business administration and corporate strategy. It is valuable for every corporation to organize their employees within a designed and logical framework which reflects the organisations strategy. It is necessary that the varieties of aspects of HRM are mutually reinforced in developing the behaviours and performance needed to accomplish business success. Every single person is part of the organisation and is partially reliable for the company’s success and therefore they represent the biggest asset of a service company. Employees represent one of the biggest cost but they can also represent the greatest competitive advantage against other businesses. Despite this, there is not a single Human Resource Management strategy that would bring success in every situation. Businesses have to identify a strategy which is exceptional to their own circumstances in terms of goals, context and the demands of business stakeholders.