STRATEGIC HRM: CASE ANALYSIS
Executive
summary
Since the introduction of Hilton hotel in china in the
year 1988, the hotel brands have significantly developed to a number of 30
hotels and it projected that the number will be 100 in 2015. The attributes
leading to the development of the hotel are Economic acquisition of various
hotels and the incorporation of technology. These factors have enhanced
establishment of economies of scale thereby making the corporation to be
economically stronger. The establishment in china considered franchising and
development mode strategies for the expansion across the international borders.
The key success factors associated with Hilton in china is the aspect of
rational allocation of human resources and performance appraisal in the
franchise market. The hotel management has ensured that the work force and work
culture enhanced in the hotel are ideal for the attribute of satisfying the
customers. The major problems faced by the hotel can be grouped into three and
these included decentralized organization structure, high staff turnover rate
and small managerial talent pool in china. The strategies to overcome these
problems include adopting a regional head office and sourcing employees from
the other economic sectors. Finally, employee training is highly recommended
because it leads to establishment of standards and culture.
Introduction
Hilton
hotel has developed to be one of the most popular brands of hotels and it
developed to encompass more than 91 global countries since its establishment
and the critical factor leading to its development is the aspect of strategic
human resource management. Analysis conducted in 2012 revealed that the hotel
has 3897 hotels with over 642 rooms. Economic acquisition of various hotels and
the incorporation of technology have made the hotel stronger in the recent
years. In this regard, the hotel has been capable of performing better then the
competitors that include Starwood hotel, Hyatt Corporation, choice hotel
international and Marriott hotel international.
Hilton
in china
The aspects of international business expansion have
ensured that regional boundaries are overlooked during the conduction of
international business. In this regard, Hilton group of hotels introduced its
branch in shanghais china in 1988 and this consideration has helped in the
generation of revenue. During the expansion, china adopted the franchising
strategy that enhances expansion because it involves spreading of branches
through the use of local outlets. Another strategy adopted by Hilton hotels is
the brand diverse development mode because the hotel has sort to introduce
different brands of services to the Chinese market and these includes hotels
and luxury brands (Ameresekere, 2001).
Today, Hilton hotel has 30 hotels spread across the cities of china but it is
projected that the number of hotels will increase to 1000 by the year 2015.
The key success factors associated with the enhancement
of these strategies includes the aspect of rational allocation of human
resources and the consideration of adopting performance appraisal in the
franchise market. Another success factor is the attribute of attracting and
recruiting the local talent which is immensely beneficial in enhancing the
attributes of innovation and organizational development (Amy J. Mazur, 2010). Finally, in the course of these developments
and application of these strategies, the corporation has ensured that
comprehensive marketing is conducted to help in the training and improvement of
the employee’s human qualities and this incentive is critical in enhancing
competitive advantage. In this consideration, the attributes of strategies
adopted has proven to be immensely beneficial.
Customer experience associated with any corporation is
immensely beneficial because it helps in the development of satisfaction
thereby leading to the development of brand loyalty and enhancement of general
economic performance. The aspect of enhancing organizational development is the
attribute that ensures ideal consideration of customer loyalty. In this regard,
Hilton group of hotels have enacted significant measures to ensure that
significant attributes that increases customer satisfaction are enhanced in the
organization. In the wake of the rising competition, establishment of customer
satisfaction and loyalty are the ideal attributes that are of concern to the
managers and the human resource manager of Hilton hotels (Chon, 2012). Equilibrium approach to quality is the ultimate culture
that has been developed to ensure that quality is maintained and the attributes
of customer satisfaction are enhanced.
Finally, the hotel management has ensured that the work
force and work culture enhanced in the hotel are ideal for the attribute of
satisfying the customers. In order top do this, the corporation has ensured
that ideal training opportunities are delivered to the new and existing
employees because this will help the organization is maintaining the culture of
quality and customer satisfaction. Each department of the organization has
training manager who ensures that each employee completes program to attain
necessary skills and organizational culture. The attributes of product
knowledge and communication skills are also tested during training (Cohen, 2007). In all aspects of training,
there are significant attributes that are considered and these include
meaningful learning, active learning, practice and precision and finally, the
provision of feedback. Upon completion of the training program, the corporation
must ensure that performance and appraisal system are enhanced because this
will be crucial in the consideration of self identification. Analysis of the
Chinese market has revealed that in-depth interviewing method has been
effectively beneficial in china because it has resulted in the growth and
development of the Chinese market.
The
major problems faced by Hilton
Decentralised organisational structure
The attribute of
adopting Decentralised organisational structure has proven to be significant
challenge because the attributes of uniformity cannot be maintained. Hilton has
adopted Decentralised organisational structure and this ensures that power and
the authority to make decisions are delegated down the hierarchy line right
from the head office to the local managers. In this attribute, any delegation
of any duty down the hierarchy line should be backed the aspects of financial
resources. The reason for this consideration is that decisions will; be made at
the local level to initiate the attributes of local incentives and
circumstances. Even though this system can be beneficial for tapping into the
wider pool of local customers, it can also be detrimental for the establishment
of uniformity because various branches of the same organization will have
significantly different set up and provisions (Enz, 2009, Hanqin Qiu Zhang, 2005). This is the case with Hilton hotels and the
customers are being confused with this consideration. Over the period,
analytical results have continued to note decentralised organisational
structure as a challenge because the managers may intently focus on the local
issues while disregarding important national issues on the bigger picture. This
has the effect of causing the managers to miss out on ideal opportunities that
may increase performance eof the corporation. Furthermore, global customers may
not like the contribution of being non-uniform in their global branches and the
differences in the available branches. This situation may be more challenging
to the hotel if the customers branches unfavourably. Analysis of the operation
of Hilton hotels in china has suggested significant challenges associated with
the hotel because each of the 30 different hotels has unique set-up and
materials and this results in significant differences in the quality of
services and satisfaction customers.
High staff turnover in front
line staff
The development of Hilton hotels in china has taken
the initiative of various planners and implementation of the policy resulted in
the establishment of 30 branches of Hilton group of hotels amongst the leading
cities of china. This incentive proved extremely beneficial because of the
significant amount of revenue that the organization generated for the expansion
into the Chinese market. Despite the consideration of performance in the
Chinese economy, the performance of Hilton group of hotels is characterized by
significant challenge because of high employee turn over. Employee turn over
refers to the rate at which employees leave the company and are replaced by the
strategic human resource department. High rate of employee turnover in an
organization is detrimental because it implies that many significant numbers of
employees leave the company but are not replaced (Jackson, 2008, Liao, 2009).
The rate of replacement may be lower than the rate of exit and this result in
reduction in the delivery of services to the customers. Furthermore, when the
rate of employee turn over is high, the organization must spend significant
amount of money and other resources inn the conduction of training for the
incoming employees. This is the case that happens in china when the branches of
Hilton hotels in china suffered the detrimental attributes of high rates of
employee turn over causing the hotels to spend significant amount of resource
on training new employees. Furthermore, the quality of services was
significantly reduced because of the consideration of lead time when the
incoming employees had to undergo training about the culture and other
attributes of the organization like the equilibrium culture and decentralized
organizational management.
Small
managerial talent pool in China
Over the period, the establishment of Hilton hotels in
china has continued to impact positive changes in the economy. The most notable
change is the expansion in tourism according to the sentiments of Muzaffer Uysal (2012). In view of this consideration, the brands of Hilton
hotels in china have experienced significant growth thereby prompting the
hotels to enact expansion programs to accommodate more visitors. This program
of continuous expansion calls for the aspect of recruiting new employees on a
periodical basis and this incentive has detrimental effects on the provision of
quality standards. Continues recruitment of employees in the Chinese economy
has detrimental effects on the establishment of quality standards and the
existing culture. Another significant problem facing the human resource
managers during the attribute of employee recruitment is the realization that
there is minimal managerial talents in
the economy and this propels the human resources to generate employees from a
cross the pool (Price, 2007). This is detrimental and expensive to the
organization because employees with no basic information and knowledge in hotels
and management are sometimes hired because of shortages in the supply of
talents. Furthermore, this consideration becomes a significant problem to the
organization because the organization must spend significant costs of resources
the incoming employees must be trained about the operations of the
organization. The incoming employees must also understand about the cultures
and provisions of the company. On average, culture and training are significant
and the members must be trained to understand these attributes. The standards
brand elements considers the attributes of overall guest experience, overall
design, in-room amenities and culinary offerings and services amongst others.
Notably, these elements are significantly beneficial because first time travels
to china will not have the opportunity to learn from hotel attendants who are
informed.
Strategies
to address the challenges
The aspect of decentralized organizational management
may be extremely beneficial for the development of an organization because of
its effects of capturing the local attributes of the organization. This system
depicts the local cultures of the community thereby enhancing development
through adoption of local cultures. This provision has proven to be detrimental
for the performance of Hilton hotels in china because they have the aspect of
depicting difference cultures thereby they fail to highlight the sense of
uniformity in the hotels (Pine, 2005). In response to the significant challenge, the top
management of Hilton hotels have initiated measures to ensure that all the
senior managers are grilled through the conduction of training which is aimed
at raising a awareness about the culture and standards of the organization. The
need for uniformity amongst the hotels in china is also crucial and this call
for the coexistent of both attributes of management that includes
centralization and decentralization. In this regard, all the branches of Hilton
hotel brands in china will obey orders issued by the head quarter inn china
while regional hotels will ensure prevalence of both centralization and
decentralization governance. Furthermore, the aspect of minimizing cultural
differences will call for the choosing of senior managers from different
regions and then projecting vibrant training to them with the aim of
alleviating cultural differences in the hotel brands.
The problem of high staff turnover in the front line
staff has continued to be a significant problem that has derailed performance
of the Hilton hotel brands in china. The brands of Hilton hotels have expanded
at a higher rates and the ideal solution that can be adopted by the managers
and the senior management of the hotel brands is to acquire employees from the
other sectors of the economy. The hotel
may be engaged with the aspect of acquiring senior executives with proven skill
sin development, human resources, government affairs, franchising,
acquisitions, marketing and constructions
(Liao, 2009, Chon, 2012).
The establishment of this incentive will be critical in fulfilling the gap that
arises in the organization due to high rates of turn over and the consideration
of this incentive will also ensure increase in productivity and growth of the
organizations because the aspects of culture and standards will be adequately
observed.
Finally, the aspect of generating ideal talents in the
organization will encompass the attributes of building outstanding brands that
will have an effect in attracting the right talents. In this aspect, developing
and training of the right talent is crucial because it will help in the
establishment of growth in the industry. The establishment of smooth
relationship with the relevant authorities is also crucial because this will enhance
generation of talents with the organization and it will also enhance the aspect
of developing ideal talents to fulfil the needs and wants of the organization.
Research analysis has stated that international companies like Hilton hotel
must continue to invest the development of human capital development and also
consider the implication of ideal measures of retention that are tailored to
meet the requirements of the local market
(Muzaffer Uysal, 2012).
Adoption of the retention program will help the organization in the aspect of
employee retention because it will reduce the rate of employee turnover thereby
enhancing development of the organization through consideration of standards,
culture and customer satisfaction. Finally, the build up of the head office in
the national territories will be immensely beneficial for the performance of
the hotel brands in the area as this will guidance regarding the implementation
of development attributes. The head office will oversee the performance of the
branches of the hotels with regard to the decentralized system of
organizational management. With the establishment of a strong base in china,
Hilton hotel brand will have the necessity to develop similar culture and
policies and it is the role of the head office to ensure these provisions are
realized.
Conclusion
Hilton hotel has continued to expand its scope
internationally by opening branches in various countries globally. Hilton group
of hotels introduced a branch in china and it has continued to develop
resulting in 30 hotel brands in 2012. The performance of Hilton hotel can be
ideally be attributed to the human resources management strategies that have
helped in development, growth and expansion. Some of these strategies include
operational strategies, franchising strategies and global development
strategies. Despite the increase in performance, the hotels in china have
received significant challenges attributed to decentralized organization
structure, high staff turnover and small managerial talent pool. In this
regard, it is recommended that the Hilton hotels in china acquire senior
executive managers from other sectors of the economy and the head quater for
the hotels are established to oversee their management. Finally, it is
recommended that the hotels should build strong brands that will attract the
best talents.
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