Impact of London Olympics 2012 on Management of Human Resources in the Hotels Industry - Case Study Example

Impact of London Olympics 2012 Table of Contents 1. Introduction 3 2. Recruitment & Retention 5 2.1 Immigrants Recruitment 7 2.2 Outsourcing 8 2.3 Education-industry partnerships 9 2.4 Retention 10 3. Training & Development 11 4. Motivation 13 5. Conclusion 14 References 15 Report on Impact on London Olympics 2012 Of Management of Human Resources in Hotels industry 1. Introduction The Hotels industry is a part of the hospitality sector. It is a key driver to UK’s economy. It is the world’s fastest growing, job-creating profession. Employment in the hospitality industry is growing at a rate faster than overall employment in the UK (People 1st). When London hosts the Olympic Games in 2012, it will be a mammoth task for the UK’s workforce to make sure everything- from buildings and infra-structure to hospitality and telecoms is ready for the estimated 500,000 extra overseas visitors (Personnel Today). It is estimated that 12,000 new jobs will be created because of the development of the Olympic Park area (People 1st). Due to a high turnover of staff, the shortage in this industry has always existed because it is either tough or underpaid for the British. Besides, the unemployment is very low (Encore Personnel) and with baby boomers retiring soon, there will be an increased gap between the demand and supply. Training for the skilled workforce has to start now to ensure smooth operations. In view of the above, the greatest challenge before the HR department will be recruitment of the skilled personnel, and retention and motivation of the existing personnel. The success of the Olympics depends entirely upon the skills and the commitment of the people involved. Managing people in the hotels industry is by no means an easy task. The three core areas would be to ensure service to the customers, recruitment and retention of skilled personnel and motivation. 2. Recruitment and retention Learning outcome from the Manchester Commonwealth games were that the number and types of roles changed as the scale and complexity of the event changed. At the last minute staffing gaps were tight so experienced staff had to be recruited. This means the labour payments was higher which could have been avoided with proper planning. If the authorities responsible for 2012 games could give due importance to this, knowledge management can help keep the costs low. It should also be borne in the mind that after the games, maintaining highly paid staff would be difficult as there is always a lull after the games. The Olympics 2012 presents a challenge to UK in terms of attracting people to the hospitality sector, as this has always been unpopular with the local people. The job cycle is very small while the turnover is very high. London needs to ensure that it has the capacity in its workforce and can meet the skills challenge. A SWOT analysis of this industry would reveal that while it is the key driver to the country’s economy, and the fastest growing industry (strength), it is intensely competitive. Shortage of skilled staff is a matter of concern specially those of chefs. Low pay, long hours, and hard labour are other causes of concern (threats and weaknesses). People are expected to offer multi-task and high level of customer service. Opportunities are plenty but require the right management to attract and retain the skill in the hotel industry. Due to declining fertility and rising life expectancy, the ageing population presents a challenge for any industry. The native worker does not prefer this industry because of low pay, more hours of work and seasonal demand. The only way to attract people to this industry is to bring about innovative changes. The minimum wages have to be given and the hours of work have to be flexible to suit the individual requirements. Incentives have to be provided. There has to be strict adherence to the maximum number of hours that any one can be allowed to work. Unless these changes are brought about, this sector would not be able to attract quality staff as in other areas. This sector has tremendous potential and challenges but lacks the right managerial staff. Action has to start immediately to equip for the Olympics in 2012. 2.1 Immigration workers There has been an influx of immigrants in this sector primarily because the local skill is not able to fulfill the demand supply gap. Immigrants are being looked into favorably by this sector because the payroll remains low, it brings in new talent and helps in the UK’s economy. They contribute towards taxes while the health expenses on them are low as most are young people. Besides, since people from different nations would converge for the Olympics, work force from different cultures and nations would help to fill this gap to some extent. The local people resent this influx but Helen Kaylan, head of HR at Novotel London hotels, too agrees the sector must look outside the UK to guarantee a full workforce. Sydney had high unemployment rate so filling the gap was not a problem but UK has very low unemployment rate (Personnel Today). 2.2 Outsourcing The industry should also look at reducing the skill-gap by way of outsourcing certain services. Most areas in the hotel industry, like chambermaids, bartenders etc require low skills and hence can be handled through the immigrant workers but procuring good chefs is a perennial problem in the industry. Outsourcing is one way of handling this problem. In fact, contract jobs or outsourcing many sectors would be ideal for the games of 2012 as immediately after the games there is abound to be a quiet period in the industry as per past records. At the moment there are 100,000 vacancies in the sector. As per the Intelligence Skills (2005) this industry spends ВЈ886 million a year dealing with high staff turnover and retention problems. When London hosts the Olympics in 2012 this is expected to go up to BJ6.2 billion. 2.3 Education – industry partnerships During the Sydney Olympics, students in the Hotel, Restaurant and Institutional Management program were given academic credits who helped develop operating plans; design menus; develop and implement appropriate food and safety guidelines; establish and maintain all necessary information technology and office management systems (Intercom online). Such apprentice scheme in partnership with food preparation colleges is a great way as they provide hands-on-training to the students. The gap in skilled supply can also be filled to a large extent. The HR managers would need to be trained effectively to handle talent management, flexible working hours, training and development of labour, more women should be encouraged and child care facility provided. At the time of Olympics, the job may be more demanding and hence arrangements should be made to intensify support to the family. This would encourage more people to opt for this industry. 2.4 Retention Because of the high turnover of staff, employers are not keen to spend much on training and development. This in turn results in lack of motivation. Due to lack of motivation, turnover increases, which again results in fresh recruitment and thereby additional recruitment expenses. The industry should realize hat this is a vicious circle and take steps to retain the staff. Cathy Donnelly, Head of Human Resources of Botanic Inns, which owns 13 bars says offering career breaks help retain staff in this high turnover industry (Britain’s hidden brain drain). Long periods of unpaid leave are granted. The company in this process retains motivated and trained staff thereby reducing training and recruiting new people. 3. Training and Development The hotel industry offers a diversity of career paths. There is a greater need for training and qualifications. Training and development can help motivate them to the desired level. Developing employees can take place through formal training but most of the training and development come from actual experience in the field. The job can be challenging because it requires flexibility to deal with continuing changes at any time during the day. The customer and employee interact at a higher level and this is an intellectual challenge for the new entrants in this industry. Interpersonal relations and excellent communication skills are necessary for any hotel to satisfy the discerning client. Training in the area of First Aid, Health and Safety too are of paramount importance. Technology is gradually pervading the human resource domain (IHRA). This calls for higher levels of technological skills from all employees. This would help produce satisfied customer, increase business and improve efficiency. Hence, the HR department should strategize on incorporating technology in the training of the new work force. Technology can be further used to teach leadership and value-added skills to the fresh recruits. Hospitality education is moving from heavy skilled-based focus to strong operational content. Emphasis should be laid on thinking and analytical skills. Generating, analyzing, and managing information is important for growth. Quality labour is necessary in the current scenario. Technology is altering the business scenario and technology should be incorporated to maximize customer satisfaction. 4. Motivation At a conference on how to ‘Build a Winning Team' for their business in time for the London 2012 Olympics, Professor Peter Jones from the University of Surrey, stressed on the importance of higher education and hospitality training for young people in the industry. Higher education helps and individual to realize his potential, which may give him an insight to the hotel industry; he needs to develop an interest and passion for this sector and not work because he has not received any better job. Talent can be nurtured through the right training. (BHA). Apart from training, an attitude of service has to be instilled into the staff. They must be motivated to enjoy the service and not take it as a duty to ‘smile’. Anticipating guest requirements is essential for the success of the HR. If such activities could be encouraged through employee-rewards, it could give a thrust to the service sector. Right from the beginning the work force should be inducted into the culture of the organization, have exposure to cross-functional activities. He should be made to feel a part of the organization where he is encouraged to make suggestions. Career development opportunities would also help attract right people as stagnancy is very common in this industry. Motivation can be the hardest thing to maintain but the most powerful tool. 5. Conclusion Seoul and Barcelona had low-profile tourism industries at the time of the games and did benefit with growth in the hospitality sector post-Olympics (Keiron Ritchard). London, as a tourist destination is already popular but lacks in skilled people interested to work in the industry. Perhaps, the Olympics 2012 could infuse interest in the people; perhaps the hospitality industry could gain by attracting, training and developing the youth at this time. This could have long-term benefits for the sector as a whole and specially for the hotel industry. The HR policies should have a strategic focus on recruitment both locally and overseas, be able to motivate and retain the existing employees. Expenses on recruitment should be kept low as it has been seen that immediately after the Olympics there is a lull in the industry. This is expected because a large number of rooms and hotels have been added specifically for the games. These would remain vacant immediately after. A focused move could result in overall popularity of the industry for times to come. Outsourcing and tie-up with educational institutions, providing hands-on training, use of technology in managing human resources, using motivational techniques and performance related bonuses should be the objective of the HR department in this sector. References: BHA (2005) Recruitment Conference lays foundations for Building a Winning Team, 22 January 2006 Britain’s hidden brain drain (2005), 22 January 2006 Dempsey K (2005), Olympics authority must not drop HR baton, < http://www.personneltoday.com/Articles/2005/12/13/33018/Olympics+authority+must+not+drop+HR+baton.htm> 22 January 2006 Encore Personnel (2005), UK unemployment - Labour Market Statistics,< http://www.encorepersonnel.co.uk/eshot/november_05/index.php> 22 January 2006 Hospitality: As it is (2005), 22 January 2006 Hospitality, Leisure, Travel and Tourism, People 1st, > http://www.htf.org.uk/Documents/Research/Market%20Profile/Skills%20and%20Labour%20Market%20Profile.pdf> 22 January 2006 IHRA (2003), Major Forces Driving Change in the Multinational Hospitality Industry, 22 January 2006 Intercom Online (2004), < http://www.psu.edu/ur/archives/intercom_2000/May4/olympics.html> 22 January 2006 London Olympics 2002, < http://www.htf.org.uk/Documents/Research/Briefs/Olympic%20Brief.pdf> 22 January 2006 Low Pay Commission Report, National Minimum Wage (2005), 22 January 2006 Olympic Village with a bed for every athlete, 22 January 2006 Personnel Today (2005), Race is on to meet the challenge, 22 January 2006 Ritchard K (2004), Staying ahead of the games, Hotel Online, < http://www.hotel-online.com/News/PR2004_4th/Dec04_BeijingOlympics.html> 22 January 2006 Read More