The Current HR Practices of Hilton Worldwide - Research Paper Example

Introduction As human resources are the most powerful assets, organizations aim at strategic HR activities such as effective recruiting, selective hiring, advanced training and extensive knowledge development programs with a view to grab maximum returns on the investment of human capital. Human capital represents knowledge, talents, people’s competencies (Mankiw, 2011, p. 538) and commercially valuable skills (Marcus, Ippolito, & Zhang, 1998, p. 490) and therefore organizations are attempting to develop these areas to make organizations high performance working. This report examines the current HR practices of Hilton Worldwide and critically evaluates how the company has been influenced by its environments on the human resource policies of the company. Hilton Worldwide: Company Profile Hilton Hotel, now known as Hilton Worldwide, has been founded by Conard Hilton in 1919 in Texas has now emerged to be the fastest growing hotel chain to attract travelers, partners, team members and others for their preferred place for entertainment and leisure. According to Statista (2012), with Hilton’s major focuses on property expansion and other management strategies including strategic HRM, the company remains to be the fourth largest to hold the market share just behind intercontinental, Marriot and Accor hotels. It has now more than 3800 hotels and resorts in more than 90 countries with more than 630,000 rooms. It proposes to beat its competitors as it is now fastest growing in terms of revenues, room-occupancy and customer loyalties (Hiltoninternational.com, 2012). Hilton’s success has been mainly driven by on-going property expansion by which it has continually been expanding its rooms, floor-space and as a result customer base too. Despite economic recession in recent years, it was furthering its property expansion. In 2009 alone, it added more than 300 new hotels with more than 45,000 rooms across the world. In 2008, Hilton opened 327 new properties (eturbonews.com, 2010). Hilton’s current approach to HRM Organisations that invest heavily on innovative training and development are found to be very successful in achieving high performance and also in achieving the organizational goals (Noe, 2002, p. 7). Training and development programs, that may vary from firm to firm, are highly effective means for enhancing, motivating and developing people’s skills, knowledge and talent. Training is a systematic, planned and structured effort to enable the human capital within the firm to learn job-related skills. Development refers to the acquisition of knowledge, skills and behaviors that help people improve their ability to meet changes in various job requirements (Noe, Hollenbeck and Gerhert, 2003, p. 8). Hilton Worldwide has partnered with Hilton Management Services (HMS) to continually provide best-in-class human resource services to its people around the world. With help of HMS, Hilton is able to provide extensive knowledge about employment benefits and compensation and to maintain an ideal training library in all different managerial and functional areas. With these training and development models, Hilton keeps on further enhancing human skills and knowledge related to job-requirements. Out of its best-in-class services are ‘PeopleSoft’ and ‘Success-Factors’ to recruit and retain the most talented and finest staff and graduates. Electronic applicant tracking, internet recruiting and maintaining updated database to track turnover statistics are some of the very significant HRM strategies of Hilton Worldwide (hiltonmanagementservices.com, 2012). The Human Resources and Training of HMS delivers employment relations, collective bargaining agreements, recruiting, training and awareness about employment laws. Hilton also maintains stronger relationship with top schools and colleges (hiltonworldwide.com, 2012) to directly recruit fresh and finest qualified and skilled people so that the company proposes to get them longer in the company. Recruiting Talent & Retaining team members for Hilton’s future expansion As Harzing & Pinnington (2010, p. 134- 135) emphasized, most firms are successful in selective hiring, but getting them retained in the business is a challenge and is found to be a reason why many business fail. In order to acquire sufficiently talented and right-fit people for specific task criteria, Hilton Worldwide is keen about selective hiring of talented people. Selective recruiting to appoint right people for the right places is apparently imperative for a firm if it urges job security and wants to maintain long-term profitability (Hayton, Biron & Christiansen, 2012, p.106). Most firms are able to recruit right people, but due to high rate of employee turnover affects the company to lose its skills and knowledge base that the companies themselves provided. Hilton is certainly an ideal firm for successfully retaining the workforce. As Hilton believes that people are keys to providing to its customers with outstanding hospitality experience, it attempts to keep talented and skilled workforce for longer through reward and recognition programs. In order to accomplish its aim of future expansion, Hilton requires more useful and effective HR strategies especially for recruiting and retaining the talented. For this purpose, a ‘Digi-score’ system is recommended for the company. For the digitalized score-card system to be implemented, Hilton needs to use advanced technology and digitalized computer system for tracking, monitoring, evaluating and finally offering specific rewards for its people based on their performance. This will be an ideal model for on-time performance evaluation by using technology. By analyzing and monitoring the positive outcomes its people do when they outperform, the Digi-Score system automatically should structure specific and highly attractive ‘rewards’ to its people. By offering rewards including global-tour, visits to international unique places etc, Hilton can not only retain its people for longer time, but also function as an illuminating model firm for best reward and recognition program. Hilton as ‘Soft’ model of organization From the Human Resource Management perspective, an organization can either be ‘soft’ or ‘hard’ in its approach to HRM focuses and aspects of managing the people. Hard model of the HRM is instrumental whereas Soft model is humanistic. Lee-Ross, Pryce & Lee-Ross (2010, p. 65) viewed that the ‘Hard’ approach to HRM focuses on the quantitative and strategic aspects of managing people. An organization that is ‘Hard’ in approach model is looking at the economic value of human as resources as to how these resources can be made instrumental in maximizing the organizational performance. But in contrast, the ‘soft’ approach to HRM is focuses on employee-centered values and aspects. It takes in to account a humanitarian concept rather than materialistic and instrumental approach to human capital. Ster and Koster (2007,p.7) distinguished the soft and hard approaches of HRM as following. Hard approach to HRM emphasizes the strategic and quantifying management aspects of HRM, whereas Soft approach focuses on the human-resource aspects. Hard model highlights the term ‘resource’ whereas the soft model highlights the term ‘human’. In hard model, employees are not valued assets, but are valued assets in soft model. Hilton Worldwide is an example of Soft model of organization, because, it’s training programs and ideal training lab strategies were designed with a view to enhance human skills and knowledge and to help the firm develop further with this improved knowledge of its people. Hilton keeps on improving and enhancing human skills and knowledge that can be helpful in improving the overall organizational performance. SWOT analysis of Hilton Worldwide Strengths Weaknesses Strong brand image to ensure steady growth Wide range of hotels and services Exposure to premium market cause increase in operating costs Opportunities Threats Robust growth in hotel industry Launch of iPhone and iTouch application, High Competition Terror attacks in different countries Micro Environments Strengths and Weaknesses Hilton Worldwide, being the 4th largest, has already acquired a very strong brand image and brand loyalty among its customers. Its brand differentiation through Conrad Hotels & Resorts, Embassy Suites Hotels, Hotels & Resorts, Hilton, Doubletree, Waldorf Astoria, Hilton, Garden Inn, Hampton Inn & Suites, Homewood Suites by Hilton, Home2 Suites by Hilton and Hilton, Grand Vacations, the company keeps on obtaining better position among its targeted customers. since it provides customers with luxury and ,mid-priced services, it has been gaining a considerable revenue growth in recent years and it expects the same to be in years to come as well. Its exposure to the premium markets such as may cause Hilton incur high operating costs (Datamonitor, 2011). Macro Environments Opportunities and Threats With more prosperities and large numbers of rooms, Hilton is continually gaining growth in both motel and hotel industries. It reported the total revenues of $ 3,800 million in 2009 and more than that in 2010 and 2011. It has also launched user-friendly applications for customers to use iPhone and iTouch devices that in turn have attracted large numbers of customers. There is rigorous competition in the hotel industry and since the company operates in more than 90 countries, hotels and large resorts are always prone to terrorist targets for attacks (Datamonitor, 2011). Conclusion This report has briefly described the current HR strategies and explained how and why Hilton Worldwide has been a successful company for the past several years. This report suggested a very effective idea of Digi-Score for the company to track and monitor people’s performance and thus to be a model firm for best reward and recognition program. Hilton Worldwide is an example of ‘soft’ model for its HRM approach as the company considered training and development programs not just as a strategy alternative, but as effective methods to increase people’s knowledge share to improve people’s knowledge and skills. This paper recommends further study about why and how a firm’s soft or hard approach to its HRM can have positive or negative impacts on its organizational performance and its contact with customers as well. 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