Considerations for Recruiting and Hiring Workers in the UK Hotel Industry - Essay Example

CONSIDERATIONS FOR RECRUTING AND HIRING WORKERS IN THE UK HOTEL INDUSTRY By Summary This report investigates the challenges in selecting, hiring andreliable workers in the UK hotel industry. There are many factors that influence high turnover in this industry. Some are unavoidable, while others can be minimized, with proper planning and knowledge human resource management. The environment of the hotel industry is also discussed, as it is important to understand how the needs of workers and of organizations can be more closely aligned. Other related aspects of this report include competition and hiring practices in the hotel industry. Above all else, the need to adopt critical practices into the human resource and organizational strategy is important, as workers who are more satisfied are less likely to leave or seek employment elsewhere. They are also more likely to provide hotel guests with a more positive and satisfying experience. Contents Introduction……………………………………………………………………………………4-5 Industry influences on hotel employment………………………………………………………5-8 Competition………………………………………………………………………………5 SERVQUAL method of measuring employee job satisfaction………………………...5-6 Bargaining……………………………………………………………………………....6-7 New Entrants……………………………………………………………………………7-8 Environmental analysis………………………………………………………………………...8-11 Human Resource Management Cycle……………………………………………………………11 Conclusion……………………………...…………………………………………………….11-12 Introduction The hotel industry in the UK and elsewhere is highly competitive. Individual hotels must compete with large chains, for guests. Chains must compete against each other. Rates for various accommodations are constantly changing, in an attempt to offer more, for less, than the competitor on the next block. The hotel industry, as a whole, faces many challenges. The recent economic slump means fewer individuals and families are vacationing. Those that do may stay closer to home. Businesses facing economic hardships may impose tighter guidelines for business travel accommodations In a 2004 report from the Office of National Statistics, an employee by industry bar graph shows ‘20% of UK workers are employed in the distribution, hotels and restaurants sector.’ This is a significant portion of the work force. It is also significant in that many human resource departments within hotels have difficulty keeping skilled, reliable workers. The lowest paid among the group are said to be hotel room attendants, according to Warhurst et al (2008). Human resource departments in the hotel industry must make hiring decisions very quickly, due to the high rate of turnover. ‘Turnover in the hospitality industry has been shown to be unacceptably high, averaging up to 200 or 300 per cent per annum’ (Cheng & Brown, 1998, p. 137). Reasons for such high turnover vary, though work can be seasonal in nature, making it a major contributor. Other causes of high turnover, however, cannot be overlooked and written off as the nature of the industry. There are many steps human resource managers can take to reduce turnover and increase job satisfaction. Another challenge is in filling vacant positions. Many hotels have openings for positions such as head chef and others that require management skills. Yet, they remain unfilled. This would indicate that a problem lies in the recruitment process and is not limited solely to hiring and turnover. A study of human resource managers, conducted by Cheng & Brown (1998), indicates that recruitment strategies have moved from more traditional methods, such as newspaper advertisements, walk-ins and selection interviews, toward those such as networking, internal markets and behavioural interviewing. However, internal market sources are generally limited to management positions or to management development programs such as a ‘manager in training program’ It is apparent that many hotels can benefit from a well-planned recruitment and hiring policy. Industry Influences on Hotel Employment Competition Competition plays an integral role in recruitment, hiring and maintaining competent workers, in the hotel industry. With the large proportion of UK workers in the hotel and food service sector, there is likely competition for nearly all open positions. It is also likely that with many jobs considered part-time or casual, workers seeking or employed in such jobs will not hesitate to leave if the hotel across the street offers something better. This can be a better job, higher pay, or other forms of compensation. Job satisfaction is also identified as critical in reducing turnover. If an employee views a competitor as having greater opportunity for job satisfaction, there is a motivation to investigate the opportunity. SERVQUAL Method of Evaluating Job Satisfaction There are various steps human resources can take to increase job satisfaction. Though the SERVQUAL method is often utilized to measure customer perceptions of service, it is also applied to employee job satisfaction. Najati (2007) explains how the five dimensions of SERVQUAL, of tangibles, reliability, responsiveness, assurance and empathy, may be used. The research Najati conducted to measure job satisfaction includes a questionnaire specifically with items related to job satisfaction, given to front line managers and lower level employees. The five dimensions were rated through employee responses, comparing expectations with perceptions. The difference for each dimension is termed the ‘gap’ score. The gap scores show significant differences in expectations and perceptions. ‘The results taken from this research show that any improvement in factors related to reliability will result in greater satisfaction among employees’ (Najati, 2007, p. 374). Reliability refers to the employee always knowing what is expected and what it takes to do a good job. Understanding of the factors influencing job satisfaction can help human resource managers develop programs that address reliability, such as standard written statements of job duties, bonus programs and other incentives, which occur at regular intervals Bargaining The bargaining power of customers is present in the hotel industry. This is particularly true when travelers use online travel sites to find the lowest rates and best accommodations, by stating what they believe is a reasonable rate. Many hotels use such sites for unsold rooms or suites. Because one hotel in a chain might be more inclined to fill remaining rooms in this manner, it would require a larger work force than another location of similar size, from the same chain. ‘This would inevitably mean filling a position in one property at the expense of increased turnover in another’ (Cheng & Brown, 1998, p. 144). Not only might this affect the performance of one location, it might also serve to increase turnover, as workers are frequently asked to perform more duties or work longer hours. The bargaining power of suppliers, for hotel human resources, means recruiters or sources that may be used to provide hotels with qualified applicants. Though the recruiter or employment agency may use the worker’s skill set and experience as leverage, to secure the highest pay and best working conditions possible, Cheng & Brown (1998) suggest that many hotels are not concerned with experience, unless it applies to management positions. Even in the case of management positions, competition within recruitment firms may lead to securing lower salary or benefit for a worker. New Entrants Human resources in the hotel industry likely will not feel extremely threatened by new entrants into the hotel accommodations industry. However, this is a major consideration for older workers. ‘In the context of a gradually ageing labour force and skills shortages, discrimination against older workers has recently become an issue of public policy concern’ (Lucas, 1993, p.33). Further, numerous studies show that the hotel industry continues to practice the trend of hiring younger workers. The threat of new entrants is very real for older workers, particularly those in management positions, who believe they could lose their jobs if a wrong decision or mistake is made. This threat may also put older workers at a disadvantage in terms of income. The manager may agree to a reduction in salary, believing that if he or she does not, a younger manager with lower salary requirements will take the position. New entrants may also include new hotel chains moving into a region or the refurbishing and re-opening of an older hotel that previously could not compete. This affects human resources in every hotel within the region. Assuming the new entrant has researched all positions it must hire for thoroughly, it may offer better conditions for employees working in the other hotels, thus creating even greater turnover. Human resources might then need to consider how to keep loyal and hard working employees. Rather than think about such tactics when an issue arises, it would be far more advantageous to develop strategies of rewarding and compensating employees well before further competition moves in. Substitutions Many employees working in the hotel industry are considered part-time or casual. Therefore, substitutes with respect to employees could be those sent from temporary agencies or the reassigning of current employees to new and unfamiliar positions. Though temporary agencies can provide very skilled and capable workers, they often come at great expense to the hotel budget. This means of worker substitution can be minimized if human resource managers put in place some contingency plans for short term replacement workers, due to illness or other circumstances, costs associated with using agencies to fill voids can be reduces. Environmental Analysis Analysis of human resource management, pertaining to the hotel industry, focuses on activities surrounding recruitment, hiring, pay and other aspects surrounding employment. The political environment mainly involves wages and regulations, such as the National Minimum Wage standards. Though many employees will receive tips or gratuities, hotel managers cannot include them in the minimum wages paid. This applies to reduced price living quarters or rooms as well. As hotel and food service employees in non-management positions tend to be paid lower than those, helping employees improve performance, to increase the amount of tips or gratuities they receive, will help in providing job satisfaction in two ways. First, it will provide greater compensation as a means of measuring customer satisfaction with the individual employee. Secondly, it provides employees with a set of goals to attain or reach for, giving them a greater sense of pride and accomplishment. Workers who are more satisfied are more likely to show up every time they are schedule to work and to do a good job. ‘What workers receive in tips, then, is perceived to be a reward for their customer service skills, over and above the rate for the job’ (Williams, nd, p.22). Workers who do a good job and meet or exceed their expected performance should be rewarded economically. Tips or gratuities are not considered revenue to the establishment, whether they are included in employees’ wages or not. Hotels still reap economic benefits when employees provide good service. Economic benefits to the hotel include reduced turnover and training costs. Return or repeat visitors who are very pleased with service are another source of economic benefit to the hotel. The social environment includes industry workers and networks, as well as the working relationships that workers in the hotel industry develop. Cheng & Brown (1998) cite high turnover as disruptive to social networks and relationships developed by workers in the industry, leading to less satisfaction with their jobs, when frequent changes in employment situations occur. Finding ways to minimize or reduce high turnover then should have a positive effect on employee morale. It also may attract a different caliber of applicants, when the establishment develops a more positive reputation in industry circles. Automated reservations systems and computer applications are just a part of the technological environment. They help maintain customer profiles and preferences. They may also store employee records. Application of new or recent employee management theory is also considered technology. Both functional managers and human resource managers should be current in their knowledge and use of methods for managing diverse groups of workers. While employment law is considered part of the legal environment, effective management is essential in providing employee job satisfaction, development of useful training programs and in ultimately providing a higher level of customer satisfaction. The environment is ever changing in the hotel industry. It is important for human resource managers to be ready for those times when the unexpected occurs, with a contingency plan or strategy. ‘Experience with crisis is associated with increasing readiness perceptions and weak support for the notion that higher job levels are associated with higher perceived crisis readiness scores’ (Rousaki & Alcott, 2007, p. 28). All staffs can become part of the plan or strategy, when human resource managers collaborate with functional managers, to identify skills or characteristics in potential recruits that indicate a greater ability to carry out crisis or contingency plan activities. As part of the larger hospitality industry or sector, hotel employees are exposed to frequent contact with the guests. Possessing a greater ability to communicate will give workers an advantage when they must stray from the usual routine or take over tasks they are unfamiliar with. The legal environment in the hotel industry is to some extent, controlled by wage and labor laws. It is recommended by some analysts that all employees should have an agreement outlining terms of employment and policies and procedures of the organization. Without this agreement, ‘the law will decide for you and this almost always goes against you, the employer’ (Lye, 2007). Having standard agreements and policies in place for every employee protects them and the hotel. Other legal considerations include sexual harassment and laws regarding prejudice or racism in hiring and in the workplace. Many employers provide written rules regarding such laws. However, providing training sessions and open forums help to clear up any misunderstandings and help prevent future incidents. Functional and human resource managers should be knowledgeable in such topics, as well as in employee stalking and other forms of workplace violence, which is increasing. Theft is also increasing in hospitality establishments. It is not enough to provide proof of the theft on camera. An employee cannot be let go until he or she is given an opportunity to defend or explain the situation. Again, failing to do this can result in litigation. Human resource managers should know laws about such behavior and have a specific procedural plan for such instances. Human Resource Management Cycle Jarez (1995) believes that human resource management strategy should focus on individual employee development, as a means of achieving organizational goals through improved performance. Based on the human resource management cycle, there are four processes that human resources in all organizations perform. Selection, or the matching of people to jobs requires the ability of human resource managers to understand fully what each position or job entails. Appraisal of job performance requires as set of standards or expectations to be spelled out to employees and should be the basis of performance evaluations. Rewards such as pay and compensation become important in achieving desired performance outcomes. Development of skills should be an integral part of the human resource strategy or plan. If these processes are linked in the human resource cycle, than a clear, precise plan for implementing them should be developed, with the input of functional managers who can add insight into the specific skills each job requires. ‘Performance management must determine the skills and credentials in which to focus their recruiting’ (Jareb, 1994, p. 4). Managers must communicate the particular skill sets required to human resource managers, so they can direct recruiting and hiring efforts that will yield the recruits or potential workers that managers will deem suitable. Otherwise, too much effort is spent reaching out to applicants that may not meet expectations in performance. While many human resource managers make such determinations during the interview process, time, effort and money can be saved by utilizing proper screening techniques, so that only those who are perceived to meet expectations are selected for the interview process. Conclusion There are many factors to consider in developing an appropriate recruitment and hiring Program in the hotel industry. The pool of applicants is plentiful. Therefore, skills or abilities should match the requirements outlined by functional managers. Roles of functional managers and human resources should be cooperative, rather than create lines of division. ‘Without either a central philosophy or strategic view, human resource management is likely to remain an independent set of activities’ (Storey, 2007, p. 14). Applied to recruitment and hiring, this means that human resource managers should understand what each specific job entails and possess a detailed written job description. This also helps new employees understand exactly what is expected. Performance evaluations should occur at regularly scheduled intervals, so workers may be given the opportunity to improve performance, if required. This also helps managers and human resources develop effective training programs. Reference List Begum, N., 2004. Employment by occupation and industry. Labour Market Trends, pp. 227-234. Cheng, A. & Brown, A., 1998. HRM strategies and labour turnover in the hotel industry. International Journal of Human Resource Management, 9(1), pp. 137-151. Routledge. Harrison, J., 2003. Strategic analysis for the hospitality industry. Entrepreneur. (May 2003). Jareb, J., 1995. The Human resource cycle as a basis for human resource development system. [Technical paper]. Kranj, Slovenia: Presernova. Lye, P. Human resource issues in the hospitality industry. Hospitality, Hotel & Travel News, (27 Jun. 2007). Nejati, M., 2007. Using SERVQUAL to measure employee satisfaction: An Iranian case study. Pp. 371-375. Proceedings of the 13th Asia Pacific Management Conference. Melbourne, Australia. Rousaki, B. & Alcott, P., 2007. Exploring the crisis readiness perceptions of hotel managers in the UK. Tourism and Hospitality Research, 7, pp. 27-38 Storey, J., 2007. Human resource management: A Critical Text, 3rd ed. Thompson. Warhurst, C., 2008. The National minimum wage, low pay and the UK hotel industry. Sociology, 42(6), p.1228. Williams, S. et al, nd. Renumeration practices in the UK hotel industry in the age of the New Minimum Wage. [Paper]. University of Portsmouth. Read More