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Human Resources in the Hotel Paris - Essay Example

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The reporter states that at best the company's compensation strategy is on par with the rest of the industry, and at worst it actually demotivates employees from giving their best, while at the same time providing salaries that are below the industry averages…
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Human Resources in the Hotel Paris
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HR Case Study
Table of Contents
I. Introduction - The Hotel Paris Case 2
II. Problem Statements 2
Challenge 1 2
Challenge 2 3
III. Solutions 3
Solution 1 3
Solution 2 4
IV. Conclusion 4
Works Cited 5
I. Introduction - The Hotel Paris Case
Hotel Paris has a problem tying pay and incentives to the organization's larger strategic goals. At best the company's compensation strategy is on par with the rest of the industry, and at worst it actually demotivates employees from giving their best, while at the same time providing salaries that are below the industry averages. There is a gap between what the organization wants to accomplish, which is to get the best of its employees en route to achieving long-term financial success, and what it has in place in terms of compensation strategies, which in the main rewards the employees the same way, regardless of how they perform. The gap is one of alignment between larger company strategy of superior service and superior customer experience, on the one hand, and how the company at present compensates its employees, which does not necessarily bring out the best out of those employees (“The Hotel Paris Case”; Freedman and Kosova 1-4).
II. Problem Statements
Challenge 1
There is a disconnect between what the company hopes to achieve, which is establishing the hotel as providing superior guest services, on the one hand, and on the other hand the way the company in general just pays average wages in comparison to the industry, and in some cases pays lower than average industry wages for some of the roles. The challenge is in aligning pay levels with the crafted strategy to provide differentiated, superior hotel services to guests, in comparison to the industry level of services. This strategy is hoped to elevate company profitability and viability in the long term, but the current employee compensation strategy of paying employees just what the industry pays on average will not help the company achieve its larger goals (“The Hotel Paris Case”; Freedman and Kosova 1-4).
Challenge 2
Tied to salaries, there is a disconnect between what the company wants to achieve, superior service, and the way the current compensation strategy pays employees the same way regardless of performance. Superior service means superior employee performance, but at present employees have no motivation or reason to perform, given that pay is not tied to the way they do their work. There are no incentives in place to reward good work. Moreover, the current pay strategy does not stimulate interest from top performers in the industry to go work for Hotel Paris, because there are no incentives to work hard in order to move ahead. The current pay strategy may have encouraged mediocre employees to stay (“The Hotel Paris Case”; Freedman and Kosova 1-4).
III. Solutions
Solution 1
There is obviously a price to pay for superior service, and that price is employee pay that is on par or superior to what the industry pays. Superior pay may mean a compensation package that is superior, and not just necessarily based on gross financial pay. The company needs to be able to identify the most critical positions necessary to deliver superior service, and for those positions endeavor to pay higher than industry averages. This is one way to attract talent too, and one way to incentivize current employees to do their best in their work (“The Hotel Paris Case”; Freedman and Kosova 1-4).
Solution 2
There is a need to overhaul pay strategies and link them to employee performance. This means instituting a meritocracy culture, where employee performance is reviewed objectively against standards, and pay increases and promotions are based on the results of such reviews, conducted on a regular basis (“The Hotel Paris Case”; Freedman and Kosova 1-4).
IV. Conclusion
The ultimate strategic goal is to grow the Paris Hotel business by elevating guest satisfaction via superior, differentiated hotel services. The way to do this is to overhaul the employee pay plan and incentivize those behaviors that contribute to superior service. That means tying pay, increases, promotion, and hiring to how employees perform. That also means, in general, paying employees and new hires higher than what the industry pays, for the most crucial positions in the organization (“The Hotel Paris Case”; Freedman and Kosova 1-4).

Works Cited
Freedman, Matthew and Renata Kosova. “Agency and Compensation: Evidence from the Hotel Industry”. Cornell University ILR School. July 2010. 9 May 2012. “The Hotel Paris Case”. Provided Case Study. Read More
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