Human Resource Mgmt:Tb For Hospitality 0070221650, 9780070221659

Table of contents :
Title
Contents
1 Management of Human Resources—Past, Present, and Future
2 Human Resource Development
3 Hospitality Human Resources Planning
4 Hospitality Recruitment and Selection
5 Performance Management and Appraisal
6 Training and Development
7 Career Development and Succession Planning
8 Compensation and Benefits
9 Employee Health and Safety
10 Human Resource Best Practices
11 Employee Relations
12 Organisation Behaviour
13 Human Resources Information System (HRIS)
References

Citation preview

Human Resource Management A Textbook for the Hospitality Industry

ABOUT THE AUTHOR Sudhir Andrews graduated with honours in English Literature from St. Stephen’s College, Delhi University. Thereafter, he completed his post-graduation in management from the Indian Institute of Management, Ahmedabad. He was one of the first MBAs to join the hotel industry in 1971. He earned two Hotel Management Diplomas with distinction—one from the International Hotel Association, Paris, France and the other from the American Hotel and Lodging Association, US. He did a fellowship with CERT, an apex body of Irish hospitality education. His experience of over 30 years includes his work with the following organisations and institutes of international repute: l

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The Oberois—where he created the Oberoi Hotel School and was the General Manager of two Oberoi properties. ITC Welcomgroup—where he rose to be Member Personnel on the Divisional Board. He created the Welcomgroup hotel training centre in New Delhi and commissioned the Welcomgroup Graduate School of Hotel Administration at Manipal, Karnataka. Institute of Hotel Management and Catering Technology—where he was the Principal of the Institute of Hotel Management and Catering Technology, Pusa, New Delhi under the Ministry of Tourism. At this time, he was also on the Board of many IHMs and the National Council of Hotel Management and Catering Technology. During this period, he was involved in several ILO and UNDP programs in India and abroad as faculty. He was also the member of the National Classification Committee and gave star ratings to many properties.

In 1994, he moved to Dubai as Director—Human Resources for the Metropolitan Chain. Here he set up the Metropolitan Institute of Hotel Management in collaboration with HIM, Montreaux, Switzerland. He also became Group Vice President—HR with a sister concern of the Metropolitan Group which have businesses in automobiles, airlines, hotels, travel agencies, etc. He immigrated to Canada in 2000 where he worked with a Property Management Company. He returned to Dubai again in 2002. In his second sojourn in Dubai, he joined the “Executive Office”—a consulting wing to the ruling Sheikh of Dubai, he also acted as an advisor to the Merit Hotel School which opened two hotel school campuses in Dubai and Sharjah. He was also engaged as a consultant with “The Peoples Partnership”— a British HR consultancy firm where he did some noteworthy consultancy projects for several banks, oil companies, and Dot.com companies. At this juncture of his life, he also worked as a career counsellor and had his own program on FM Radio 89.1 in Dubai. He brought out his own column on Career Counselling with Khaleej Times, a Dubai newspaper, for a year as well as taught at Eikon Academy which brought in the Herriot- Watt University. Sudhir Andrews is now Dean of École Hôtelière Lavasa in collaboration with École Hôtelière Lausanne, Switzerland. He is also the author of 10 hospitality books published by McGraw-Hill India.

Human Resource Management A Textbook for the Hospitality Industry

SUDHIR ANDREWS Dean—École Hôtelière Lavasa

Tata McGraw-Hill Publishing Company Limited NEW DELHI McGraw-Hill Offices New Delhi New York St Louis San Francisco Auckland Bogotá Caracas Kuala Lumpur Lisbon London Madrid Mexico City Milan Montreal San Juan Santiago Singapore Sydney Tokyo Toronto

Published by the Tata McGraw-Hill Publishing Company Limited, 7 West Patel Nagar, New Delhi 110 008. Human Resource Management: A Textbook for the Hospitality Industry Copyright © 2009, by Tata McGraw-Hill Publishing Company Limited. No part of this publication may be reproduced or distributed in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise or stored in a database or retrieval system without the prior written permission of the publishers. The program listings (if any) may be entered, stored and executed in a computer system, but they may not be reproduced for publication. This edition can be exported from India only by the publishers, Tata McGraw-Hill Publishing Company Limited ISBN (13): 978-0-07-022165-9 ISBN (10): 0-07-022165-0 Managing Director: Ajay Shukla General Manager—Publishing: (B&E/HSSL and School): V Biju Kumar Sponsoring Editors: K N Prakash/Abhishek Sharma Senior Copy Editor: Anupma Rai Junior Manager—Production: Medha Arora General Manager—Marketing (Higher Education & School): Michael J Cruz Asst. Product Manager: Vijay Sarathi Jagannathan Controller—Production: Rajender P Ghansela Asst. General Manager—Production: B L Dogra Information contained in this work has been obtained by Tata McGraw-Hill, from sources believed to be reliable. However, neither Tata McGraw-Hill nor its authors guarantee the accuracy or completeness of any information published herein, and neither Tata McGraw-Hill nor its authors shall be responsible for any errors, omissions, or damages arising out of use of this information. This work is published with the understanding that Tata McGraw-Hill and its authors are supplying information but are not attempting to render engineering or other professional services. If such services are required, the assistance of an appropriate professional should be sought. Typeset at Le Studio Graphique, Guru Shivir, 12, Sector 14, Gurgaon 122 001, and printed at Avon Printers, Plot No. 16, Main Loni Road, Jawahar Nagar, Industrial Area, Shahdara, Delhi 110 094 Cover Design: K Anoop Cover printed at: Rashtriya Printers RADYCRFYRADC

Dedicated to all my students who have taught me so much

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Letter from the Author

Letter from the Author

Dear Reader,

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t is a pleasure to bring out a book on human resources especially for the hospitality industry. Herein I offer you the sum of all that I have learnt in my 30 years of experience of managing human resources. All hospitality organisations have recognised that the human resources are their most important asset. In spite of building beautiful properties, hospitality organisations have found that the gap between competitors and them is very narrow. In fact, the guest is spoilt for choice. Hospitality organisations have realised that the real cutting edge is the people and how they bring the property’s products to the guest. In other words, it is the service that makes the difference. Because of this, modern hotels are giving their frontline personnel much more empowerment and authority to make independent decisions. They have also involved them in important decisions regarding service delivery strategies. This book empowers students and professionals of hospitality management with the tools to manage the human resources in these fast-changing times. It explains the true meaning of Human Resources Development (HRD) and how it is used to build individuals and teams to serve their individual aspirations as well as the goals of the organisation. It discards the “master-slave” relationship approach, moving more towards partnerships between the management and staff. It recognises that the employee and the organisation have to progress as one in today’s fast changing world to succeed. However, there are many questions to be answered to make this happen. Hopefully this book gives answers to the following questions. 1. How do we break down societal perceptions of employment in services? It is the physical evidence of professionally run hotels and restaurants that have broken those societal barriers. The struggle is still on to attract the best talent from well trod and reputed alternative career options. This book talks about best modern practices adopted by the industry. 2. How do we attract good talent? It is not the number of people available in the market but their quality which is in short supply. This book presents those progressive recruitment strategies to harness good talent. (Contd.)

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Box (Contd.)

3. How do we compensate good talent? Organisations have been restricted by archaic compensation practices to attract and retain the best talent. There is great mobility of the workforce in the industry. Most hospitality organisations bemoan staff turnover. This book talks of bolder compensation strategies to attract and retain good talent. 4. How do we evaluate and reward good performance? Good talent is no longer satisfied with annual increments that barely cover cost of living. Employees want big bucks quickly to fulfil their dreams in what is perceived as very short working spans. We shall learn financial and non-financial methods used to retain good people. 5. What do we do to older employees who are not keeping pace with the times? Hospitality organisations are opting for youth in their workforce. The youth are ambitious, energetic, techno-savvy, and well educated. The challenge lies in how to manage the older workforces. This book discusses such strategies. 6. How do we keep the employees abreast with new changes? Training and Development is an essential way of life in hospitality. Employees have to develop the right knowledge, skills, attitudes, and behaviours, especially since some are in direct contact with guests. Frontline employees create the demand, create the product, and deliver it to the guest like a bartender. It requires special competencies towards customer service. This book discusses modern training alternatives available to get the best transfer of knowledge and skills. 7. How do we give careers to the new ambitious workforce? Good talent is always on the lookout for better opportunities. The challenge is how to give them meaningful careers so as to retain them and not upset the average worker. Modern workforces are no longer loyal to an organisation. They are only loyal to themselves and their profession. They expect to reach higher positions early and are willing to work hard for it. This book looks at career development options. 8. How do we develop a positive culture? Organisations have to build a climate of enthusiasm through participation. Unions and management are no longer jostling for power and money. Labour Unions have become partners with organisations, both wanting the organisation’s common good. As a matter of fact the move towards hiring knowledge workers in a technological progressive world will make unions redundant. Employees will have an equal say in the way the organisation does business.

This book will hopefully provide answers to many more questions about managing the human resources. Remember that managing human resources is not only the job of the HR Manager but is the responsibility of each and every supervisor responsible for people. To be a successful hospitality manager you have to be good with people who serve beside you. I hope this book will always be your guide. I wish all my readers good luck and success in their careers. SUDHIR ANDREWS

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Contents

Contents

Letter from the Author List of Figures

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1. Management of Human Resources—Past, Present, and Future Managing Human Resources—The Evolution 1 Importance of Human Resources in the Hospitality Industry The Impact of Globalisation on HR Practices 8 Summary 24 Key Terms 25 Review Quiz 25

2. Human Resource Development What is Human Resource Development? 26 HRM vs. HRD 26 HRD Processes 29 Role of HRD 33 Organisation of the HRD Department 37 Summary 42 Key Terms 43 Review Quiz 43

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Contents

3. Hospitality Human Resources Planning

44

Organisation Vision, Mission, Culture, Values, Strategies, Objectives, and Structure 44 Importance of Human Resources Planning 62 HR Policies and Objectives 66 Hospitality Organisation Structures 72 Hospitality Staffing Norms 81 Job Analysis 90 Job Descriptions and Job Specifications 96 Work Design 100 HR Budgeting 104 Summary 112 Key Terms 112 Review Quiz 113

4. Hospitality Recruitment and Selection

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Introduction 115 Recruitment Policies 116 Sources of Human Resources Supply in the Hospitality Industry Selection Processes 127 Basic Interviewing Skills 140 Appointments and Joining Formalities 143 Orientation and Socialisation 145 Summary 149 Key Terms 150 Review Quiz 151

5. Performance Management and Appraisal Performance Appraisal and its Importance Designing an Appraisal System 153 Types of Appraisals 160 Performance Counselling 167 Reward and Recognition Schemes 168 Summary 170 Key Terms 171 Review Quiz 171

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Contents

6. Training and Development

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Overview of Training and Development 172 The Training Process 175 Training Policies and Procedures 177 Training Needs Analysis 181 Training Objectives and Design 187 Training Methodology 193 Training Aids 198 The Trainer 199 Management Training and Development 200 Evaluation of Training 203 Summary 206 Key Terms 207 Review Quiz 207

7. Career Development and Succession Planning

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Overview 208 Career Development 212 Succession Planning 226 Summary 230 Key Terms 230 Review Quiz 231

8. Compensation and Benefits

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Overview 232 Does Money Motivate? 237 Developing a Compensation Package 238 Summary 245 Key Terms 246 Review Quiz 246

9. Employee Health and Safety Occupational Hazards 247 Prevention of Work Hazards First Aid 252 Fire Prevention 254

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Contents

Emergency Plans 259 Summary 266 Key Terms 266 Review Quiz 267

10. Human Resource Best Practices

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Assessment Centres 268 Creating a Learning Organisation 274 Developing a High-Performance Organisation 277 Knowledge Management 280 Job Evaluation 283 Mentoring 290 Summary 295 Key Terms 296 Review Quiz 297

11. Employee Relations

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Overview 298 Why do Workers Join Unions? 299 How do Workers form Unions? 301 Collective Bargaining 303 The Labour Contract 304 Managing Grievance 310 Managing Discipline 313 Employee Social Programmes 315 Suggestion Scheme 317 Employee Exit 318 Summary 325 Key Terms 326 Review Quiz 326

12. Organisation Behaviour What is Organisation Behaviour? Organisation Design 329 Group Dynamics 330 Managerial Leadership 333 Individual Motivation 341

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Conflict Management 348 Organisation Development 357 Managing Change 360 Summary 369 Key Terms 370 Review Quiz 370

13. Human Resources Information System (HRIS) Criteria for Selecting an HRIS Applications of HRIS 374 Summary 376 Key Terms 376 Review Quiz 376 References

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List of Figures

List of Figures

2.1 2.2 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 3.10 3.11 3.12 3.13 3.14 3.15 3.16 3.17 3.18 3.19 3.20 3.21 3.22 3.23 3.24 3.25 3.26

Business Environments HRD Organisation Structure of a Large Hotel Organisation Activities Traditional Hierarchical Organisation Structure Work Focus Simple Structure Functional Structure Multidivisional Structure Holding Company Structure Matrix Structure Corporate Structure of a Chain Operation Grouping by Function Grouping by Product Flat Organisation Structure Management Organisation Structure of a Large Hotel Organisation Structure of a Small Hotel Organisation Structure of Large Restaurant Organisation Stucture of a Small Restaurant Organisation Stucture of a Fast Food Restaurant Hotel Staffing Norms Job Analysis Chart Job Analysis Task List Job Description Job Specification Behavioural Indicators Job Enlargement Job Enrichment

27 38 44 57 58 59 59 60 60 61 73 74 74 76 78 79 79 80 80 82 91 93 95 97 99 101 102 103

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List of Figures

3.27 Budget Graph 3.28 HRD Budget Format

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4.1 4.2 4.3 5.1 5.2 5.3 5.4

Pre-recruitment Task Flow The Hiring Process The Screening Process Weighted Checklist Forced Choice Method The Appraisal Process 180-Degree and 360-Degree Appraisal

116 127 128 157 157 163 164

6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 7.1 7.2 7.3

Training Process Systematic Approach Training Policy of a Hotel Training Gap Four Stages of Learning Lesson Plan Knowledge Retention Graph Management Structure of a Hotel Career Development Programme Standard Career Path of a Receptionist Key Leadership Positions

175 176 177 182 189 192 194 200 212 224 228

8.1 8.2 8.3 9.1

Steps to Develop Base Pay Job Ranking Job Classification Fire Protection Checklist

238 240 240 257

10.1 10.2 10.3 10.4 11.1

Steps for Establishing Assessment Centre Organisation Chart Flow of Activity Evaluation Rationale Form Expectation and Tolerance Levels

272 285 286 286 306

12.1 12.2 12.3 12.4 12.5 12.6 12.7 12.8 12.9 12.10 12.11 12.12 12.13 12.14

Anatomy of a Group Departments of a Hotel Uni-Dimensional Continuum Managerial Grid Styles Maslow’s Need Hierarchy Conflict Management Appeal to Higher Positions Common Resource Centre Linking Role Duplicate Resources Central Reservation Centre Functional Specialists Authority Continuum

330 333 337 338 340 343 348 352 353 353 354 354 355 367

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Management of Human Resources—Past, Present, and Future

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Management of Human Resources— Past, Present, and Future 1. MANAGING HUMAN RESOURCES—THE EVOLUTION Slavery Human beings began contributing to enterprise when early tribes and nations conquered territory and used those they vanquished as slaves. Slavery was a practice in which masters owned other people. Slaves were held against their will and deprived of their right to leave or to refuse work, and often worked without pay under inhuman conditions. The masters provided them minimal food, shelter, and clothing. The first known slaves were recorded about 3500 BC in Sumer and Mesopotamia (now Iraq). Slavery also existed in Assyria, Babylonia, Egypt, and Persia. The Jews (as per the Bible—used as a historical document here) were slaves to the Pharaohs of Egypt and helped to build their monuments and cities. Slavery expanded as commerce and trade increased. Trade needed a disciplined labour force to produce goods for export. Slavery reached its peak in Greece and Rome. They used slaves of the conquered territories to build their empire as well as to work as domestic help. Though slavery had almost died with the fall of the Roman Empire, it raised its ugly head in 1500s and 1600s when the New World (America) Branding Slaves was colonised. Portuguese and Spanish sailors explored the coast of West Africa and kidnapped African natives to work as slaves in the cotton, tobacco, sugarcane, and coffee plantations in America, Brazil, Cuba, and the West Indies. African slaves were sold as commodities to plantation owners who provided them with poor clothing, housing, and food. The emphasis was on exploitation. Black slavery started to decline in late 1700s as there were strong movements to abolish slavery in America. There has been an aberration of slavery in modern times as well. Practices akin to slavery have been recorded in recent history. During World War II, 8–12 million Jews, gypsies, Poles, and others were forced to work as slaves under inhuman conditions in the Nazi industry. Only 1.5–2 million survived the Nazi Holocaust.

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Serfdom With the fall of the Roman Empire in 400 AD, international trade fell sharply. The decline in demand for goods produced by them reduced the need for slaves. In Europe, slavery slowly changed to serfdom. A serf was midway between a freeman and a slave. In fact, they were bonded labour. The serfs were permitted to lease land or work in their master’s land. A serf’s holding usually included a crude house, the adjoining plot of land, a share in the produce, and a few animals to till the land. They paid their master a rent for the land. Part of the crop also went to the master’s manor. Though serfdom is associated with medieval Europe, it existed elsewhere too. English law ended serfdom in the 1600s, while few serfs were left in France in 1789 when the French Revolution began. Russia and Prussia had serfs until the 1800s.

Craftsmanship Artisans or craftsmen had skills in converting raw materials to finished goods. Their trades ran parallel to a prominently agrarian society before the industrial revolution. They usually worked for themselves in family businesses in rural areas or worked at shops in towns as members of guilds. Guilds were associations of people of a similar craft that protected their interests. They were given recognition by the sovereign authority of the time. The guilds also created the rules by which the craftsmen worked. Some products made in towns were exchanged for food raised in the countryside. Artisans produced goods like cloth, hardware, jewellery, leather goods, silverware, weapons by hand and used simple tools. Their businesses were loosely called the cottage industries. Only 10 per cent of the population lived in cities then. Family businesses were mostly craft oriented then, producing goods to the extent of the number of hands available. Sometimes, merchants called entrepreneurs, distributed raw material to these family businesses in villages and towns to convert it into a finished product. The entrepreneurs owned the raw material, paid for the work, and took the risk of finding markets. Enterprises had paternalistic owners who cared for all workers’ needs (and withdrew them if they showed disloyalty). Owners chose apprentices carefully, mostly relatives, to work in and perpetuate the family business. Owners were benevolent dictators (kind, yet strict) who demanded fierce loyalty to the family business. They treated all employees as family members and created trust through constructive interaction, as well as regular and open contact. The paternalistic approach knitted together all employees through strong shared values. The ‘management’ emphasis was based on relationships.

Industrial Revolution and Labour Relations The industrial revolution in the mid-eighteenth century in England took cottage industry out of homes to cities where factories with power-driven machinery now produced finished goods. Factories employed workers in large numbers who were mostly migrants from rural areas and towns. By 1800, the revolution spread to all the colonies of England including America. While Britain had large natural resources of coal and iron, the colonies provided other raw materials for conversion into finished goods. The textile and iron industries were perhaps most important then. The industrial revolution changed the perspective towards industry and workforces. Private investors and financial institutions bankrolled industrialisation. They created a new set of business leaders called capitalists who took control of manufacturing. Capitalists are those who own the trade and industry of a country. The workforce requirement changed from one of relationships (of the paternalistic family business) to competence. People were hired based on their ability to work with machines, and not on family relations.

Management of Human Resources—Past, Present, and Future

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The low wages (apart from cheaper raw materials from colonies) kept the costs of goods low. Industrial workers lived in over-crowded and unsanitary housing complexes and worked in terrible working conditions in factories. Because of this mistreatment, qualified workers showed no loyalty to their company, but moved on to the highest bidder for their expertise. Unskilled and semi-skilled workers on the other hand, toiled to earn a decent wage to survive. The new industrial life created a distinct distance between the owner and the workforce. Large assembly lines had tiers of management and supervisors whose sole purpose was productivity. In fact, the management looked at people as extensions of their machines and had only one aim—to get the maximum output from them. With a large workforce and several layers of management, the owner could not maintain close relationships with the workforce anymore. The workers, therefore, felt alienated from the person who, they believed, provided them with their ‘bread and butter.’ The working day was perhaps 12 to 14 hours a day for six days in a week. The machines forced the workers to work faster and without rest. Jobs were repetitive and extremely monotonous. Wages were low. Most factory workers were desperately poor and illiterate. Since there was an oversupply of workers from rural areas into cities, owners exerted great power over the workforce and could replace them at will. Workers had no legal recourse to improve their lot. British law initially forbade the forming of Labour Unions and imprisoned anyone who joined one. However, some workers did form unions in desperation. They rioted and destroyed machinery when unhappy. Unions protected workers from exploitation and demanded better working conditions, higher wages, and shorter hours. Laws like the Minimum Wages Act and Approval of Collective Bargaining helped the workers get a strong say in organisations. They found that the bargaining power of group was greater than individuals. Because of the increasing labour movement by 1930, the British parliament had to pass laws that permitted workers to form Labour Unions. The National Labour Relations Act of 1935 in the US also required employees to bargain with unions. The labour movement improved economic progress as well as better living and working conditions. Collective bargaining ensured better wages, shorter working hours, protection from accidents, and fringe benefits. The labour movement created a new management discipline—Industrial or Labour Relations. Factories hired a new breed of specialists who could negotiate with unions. They called them Labour Officers. Negotiations with unions were based on improving productivity and working conditions. Issues of labour turnover, absenteeism, employee motivation, etc. were main management concerns. Inspite of legislation to the contrary by the British parliament, a large number of skilled industrial workers migrated to other countries in Europe and America spreading know-how. They also spread the benefits of Unionism. The main management emphasis was on manipulating productivity.

Personnel Administration By the turn of the twentieth century, labour unions were powerful and legislation enacted several laws to protect the industrial workers from exploitation. Organisations felt the need for a specialist who could interpret labour laws and protect them from labour defaults. The organisations formed the Personnel Administration department under a legal specialist called the Labour Officer. This department’s main concern was to stay within labour laws and give as little as possible to employees within the law. Unions too approached work as to get the most out of the organisation with the least input by workers. Personnel Administration departments were legal departments manned by people who had legal foundations. The whole management objective was

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to exercise control and discipline. It was found that a manager spent 30–40 per cent of his work time on Labour-related issues. The whole relationship with the workforce had deteriorated to one of legal conformity.

Personnel Management/Human Resources Management (HRM) It was not till the 1930s that a frustrated management found that a manipulative union relation was not the way forward. Organisations had high labour turnover, absenteeism, and a lack of productivity. They then hired behavioural scientists to look at employee morale and motivation. It was the first time that they were recognising that the workforce were a collection of human beings who could be motivated to perform better. The Hawthorne Works of the Western Electric Company in Chicago hired Elton Mayo, a Harvard professor, to study the human aspect of industry. He made ground-breaking discoveries of the industrialised worker. For example, he discovered the existence of informal groups that fulfilled the social needs of the alienated worker in a dehumanised workplace. Furthermore, these informal groups could influence the pace of work and productivity as they chose fit. Basically, workers wanted attention in an alienated workplace and to be treated as human beings. His research is valid till today. These new insights led to a spate of motivational studies (see Chapter 12 for more details). Their recommendations forced the organisations to re-title their personnel policies from personnel administration to human resources management or HRM. Personnel management or HRM recognised that worker morale affected productivity. Workers needed more than reasonable wages to be happy in their jobs. For example, they needed recognition, a feeling of achievement, and an opportunity to participate in decisions that affected their work. The new face of personnel management gave importance to these motivational studies and looked at providing employee motivators along with better working conditions such as industrial canteens, leave benefits, etc. Labour Officers became Welfare Officers whose main emphasis was on motivation. They helped in meeting employee needs through recognition programmes, company newsletters, suggestion schemes, and recreation programmes. Due to new legislation, the Personnel Managers also introduced and supervised long-term benefits like pension plans, social security, and gratuity. They also gave importance to workers’ health and safety.

Manpower Development Personnel management continued till the 1960s when a new concept emerged—Manpower Development. This was largely influenced by automation and the beginning of information technology. It recognised the concept of human potential and that human beings could be developed for new roles created by automation. Training and Development was a core activity of Manpower Development. It co-existed with personnel management. It may be interesting to note that the term manpower development did not reflect women as a significant workforce even though some factories employed large numbers of women for their dexterity in handling delicate tasks. Organisations did not realise then that they were on the threshold of the women’s liberation movement which gave women equal rights. While personnel management continued to care for human welfare, the manpower development department focussed on training and development.

Human Resources Development (HRD) It was not till the 1980s that women were recognised as a significant part of the workforce and that Manpower Development was re-titled Human Resources Development (HRD). Due to the women’s emancipation in the 60s, women now stepped out of their traditional roles as home-makers into all aspects of industry and commerce.

Management of Human Resources—Past, Present, and Future

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Organisations had to recognise their presence and contribution. HRD also integrated Personnel Management with Manpower Development to give employee relations a more human face. Because of this, HRD became a key member of strategic planning. Organisations now believed that HRD could make a significant difference to the profitability and growth of the company with a new enlightened role. HRD introduced several new concepts such as scientific recruitment and selection, orientation and socialisation, performance management, career planning, succession planning, innovative compensation practices, and training and development to harness and reward the human potential. HRD also had a major role in creating a culture of trust, openness, and innovation. HRD systems were not only concerned about present performance but long-term survival and growth. HRD’s role, therefore, was: 1. 2. 3. 4.

To optimise the human resource potential To enable employees to grow with the organisation To help in aligning individual and organisational aspirations To promote collaboration and team spirit by establishing a climate of trust, openness, mutuality, and interdependence.

HRD became a change agent by adopting best practices to harness the capabilities of individuals and develop them to meet the organisation’s goals and aspirations. The title ‘HRD’ itself signified this purpose.

Human Resource Development Human HRD recognised the employee as a human with rational thoughts and feelings. Earlier, organisations related to the employee at the rational and logical level only and ignored the employee’s feelings. They, therefore, focussed on productivity at all costs and mostly at the expense of employee morale. However, organisations soon learnt that feelings were equally important to create motivation for better productivity. To do this, managers had to first recognise their own feelings (and biases) through innovative programmes, such as sensitivity training and T-Group sessions, before they could be sensitive to others. Feelings needed to be addressed also to bring out the best human potential (which is the capacity to be developed further).

Resource Organisations also recognised that the employee was an important resource (i.e. asset that can be used to achieve a goal) to the organisation. Many organisations placed their workforce as their greatest asset. They recognised that employee performance and productivity created the competitive edge. In service industry, people were the cutting edge.

Development Finally, the organisation took the responsibility of developing human potential and making it worthwhile for the individual as well as for the organisation. All sub-systems of HRD served development opportunities of the individual. For example, new hires were chosen in terms of their potential to grow and their possible contribution in future. Similarly, performance management was an opportunity to identify weaknesses to be overcome; and strengths to be further developed for both the individual’s and organisation’s benefit. Career plans and succession plans were devised to allow people to grow in short and long terms, etc. The management’s emphasis during this period had moved away from control to developing potential. It moved from a reactive mode to a proactive one.

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Human Resource Management

Talent Management Today, HRD is moving to a further concept called Talent. This term recognises the shift in society from the industrial age to the technological and service age. HRD departments are being re-christened to Talent Department which recognises a new breed of workers called the knowledge workers. The knowledge worker is a highly qualified and competent person who processes complex information and possesses skills to convert it into currency. These employees identify more with their profession rather than with the employer. Rapid technological changes will increase the need for highly trained individuals as well as the likelihood of employee obsolescence. Talent believes that people’s skills can be used to contribute to organisational goals, and in many cases, provide the cutting edge. Talent orientation believes in self-autonomy of the worker, continuous learning, fast-track career plans, pay for skills, and worker involvement in all aspects of business strategy. It recognises the front-line workers (those in customer contact) as the main force of the organisation and empowers all the specialists and the corporate management of the organisation to respond to their needs to give better customer experiences. The main management emphasis of Talent is on managing knowledge.

2. IMPORTANCE OF HUMAN RESOURCES IN THE HOSPITALITY INDUSTRY First, let us understand what we mean by the hospitality industry. The hospitality industry includes all lodging and food service operations. The industry includes every food outlet—from the smallest roadside inn to the largest five-star hotel; from the hotdog stall to the flashy night club. The hospitality industry is part of a wider service industry which is now the mainstay of our present society which had evolved from the agrarian society and the industrial society (Alvin Toffler). The larger service industry includes the airlines, railways, telecommunications, utility services, hairdressing, tailoring, etc. A service is a benefit (to the satisfaction of the customer who pays for it). A service is an experience that can be interpreted as good or bad by the level of expectations of the buyer of the service. Service is offered by people whose expertise is the selling point. A hairdresser is qualified to style hair and is paid according to his/her level of skill. A waiter is qualified to give a set standard of table service. Take the person out and there is no personal service. Personalised services require ‘warm bodies’ who can provide them. A receptionist has to be present at the desk whether a guest arrives at a hotel or not. She is paid for her presence. There are other differences between services and traditional physical products:

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In services, the time period between the demand from a customer and the compliance with the request is very short, sometimes immediate. In a meal, for example, the guest will demand a product and expect it to be created immediately and served. The fast-food industry gets its unique place because of the immediate satisfaction of a meal demand. A product like toothpaste, on the other hand, is produced in anticipation of demand months before the actual product is sold. In services, the server is face-to-face with the customer when he demands the product. He has to understand the guest’s special needs and respond correctly to satisfy that need. In a meal experience, a guest may ask for a meal without garlic. The server is to respond to that need and instruct the cooks about that special need which is satisfied in a reasonably accepted time between order and supply.

Management of Human Resources—Past, Present, and Future

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A product like toothpaste, on the other hand, is standardised and manufactured whether the guest prefers fluoride or not. In a service, the product or service is consumed immediately. A meal, for instance, is eaten immediately. A hair dresser’s service is employed immediately upon demand. In comparison, a product like toothpaste may be bought from nearby store and used many hours or days after the purchase. Services are largely based on reputation and ‘word of mouth’ publicity. There is no sampling first to ascertain whether the service is suitable or not. A meal has to be eaten to decide whether it is worth it’s value in terms of money. A hair dresser cuts the hair and hopefully gives the look one is expecting, while a product like toothpaste gets its image after years of advertisement and publicity. Services are perishable. Revenue from a cover not sold in a restaurant at meal time is lost forever. A meal returned by a guest because it does not meet expectations is lost forever and thrown out. It cannot be reused. Services cannot be stored. By their very nature, services are consumed immediately. A restaurant, for instance, cannot store its lunchtime service for dinner. The service is consumed in that allotted time and the dinner service is another service period altogether. However, a product like toothpaste can be stored for months before it is used. The skills of those providing the service is very crucial to the purchase experience. A bartender must produce the right cocktail-mix based on training and skill to satisfy the guest. The server, therefore, provides the dining experience—unlike a product like toothpaste, which is produced by machines and does not create the personalised experience. Services are intangible and rely on the experience they provide, unlike a product like toothpaste which can be touched, seen, and smelled to determine whether it is desirable. Experiences are very subjective and can vary from person to person. This is the reason some people find a particular restaurant wonderful to visit while others do not find it so. As services are provided by people, it is difficult to standardise them. Quality control becomes a challenge, though restaurants have tried, through training, to standardise procedures with the hope of consistent levels of service. It is possible to standardise products like meals through standard recipes and cooking methods. Unfortunately, service is delivered by people who may vary in their attitudes and consistency from day to day. Services are expensive because they are delivered mostly by people. The greater the skill of the server, the greater is the cost of the service. There are hairdressers that are at the top end in reputed salons, while there are others who are average in their skills. Similarly, there are celebrity chefs who have taken the art of cooking to new heights of gourmet experience, while there are others who produce an ordinary meal. To keep the service available, the staff have to be present whether there are customers or not. A waiter in a restaurant may pass a whole shift without a single customer at his station. The cost of the waiter’s presence has to be borne by the owner.

With this appreciation of the quirks of service, we now understand that people who deliver it become the cornerstone of the hospitality industry. Franchised hotels and restaurants have closed the gaps in the nature of the physical product. We do see standardised guest rooms at a Holiday Inn just as we see standardised food at Kentucky Fried Chicken. How does a customer choose? It is the employees who make the difference. They can give good service or bad service. Human resources management has worked towards standardising service

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responses. A Burger King’s outlet in Berlin will take the same time to serve hamburger there as its outlet in Mumbai. This has been achieved through standardised services. A telephone operator of Holiday Inn in London will say, “Holiday Inn, good morning. How may I help you?” just as its operator in Kuala Lumpur. The HR processes have done a fine job in standardising these responses. Is it good enough? Some people find the responses too plastic and rote. They would like to have more genuine warmth. The HR management process now has to tackle human attitudes and motives to make these responses more sincere. They are now dealing within the human aspect of the resource. The human resources have a huge challenge in the hospitality industry because they know that the competitive edge will have to come from them.

3. THE IMPACT OF GLOBALISATION ON HR PRACTICES What is Globalisation? Globalisation is the opening of world markets. The two implications of globalisation are: 1. The products and services can be sold anywhere in the world. 2. People can seek employment anywhere in the world. Globalisation was made possible by several crucial developments: 1. The invention of cyberspace. IBM was the pioneer who created a ‘transport’ to this invisible continent called cyberspace through the use of computers. While computers were expensive and unwieldy structures in the 50s, they soon became affordable to the individuals who brought them to their homes in the form of desktops and later the laptops. Today, we have handheld computers called organisers. Microsoft created the ‘visa’ to enter the new continent through Data Operating Systems (DOS) that facilitated the exchange of information. Nations, organisations, and individuals could gain access to this continent and leave their footprints at no cost. Thanks to the commonwealth, colonial Britain had already left half the globe with English speaking populace. The cyberspace, therefore, adopted English as its official language. The international credit cards (Visa, MasterCard, American Express, etc.) made it convenient to pay for products and services globally. They took the responsibility of exchange rates and billings. Courier services (DHL, etc.) developed into a new force that created delivery of products from anywhere in the world to a person’s doorstep. A person in India could buy a product or service in the United States or anywhere else in the world. Cyberspace crossed boundaries and allowed products to invade the world markets. 2. No country was left untouched by this invasion which led to the breakdown of political and economic boundaries. Perestroika, the Soviet revolution, had created the trend of movement from protected societies to world societies. The once omnipotent communist state had become a capitalist state. It recognised that protective policies were no longer tenable and that they had to open up their society to the world. This ended the cold war and the world jostled for a chance to sell in the new market. The breaking down of the Berlin wall was a physical expression of the revolution that was taking place. It spawned a host of new nations (CIS countries). Many other countries, including India and China, who believed in protectionism, opened their economies to the world, accepting foreign investment and imports of foreign goods. These meant that foreign companies could ‘open shop’ in any market worldwide and do business. It also meant that foreign goods could be imported. 3. Another major benefit that globalisation has brought to the consumers is that they can access the best quality international products and services. Traditional businesses that enjoyed protectionist

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policies earlier are now exposed to world quality products and at cheap prices. World producers innovate to give the best products and services at the least price. A good example in India is the automobile sector. Earlier, under the protectionist regime, Indian consumers could only buy the Ambassador or Fiat car. The manufactures peddled outdated models which the public had to buy as they had no choice. Soon Maruti, in collaboration with Suzuki of Japan, brought to the Indian public a model which was a formidable alternative of quality. Today, with the opening of the economy, the public has an incredible choice of latest luxury and economy cars. With this as a background, we see that technology and political forces have facilitated a global web-based market which allows for multiple types of collaboration regardless of geography and language. Morgan Stanley estimates that from 1995 to 2005 American consumers have saved over $600 million through cheap imports from China. Globalisation has increased world trade by 1500 per cent in the last fifty years— from $53 billion to $5.1 trillion—accounting for 18 per cent of the world’s $29 trillion economy. The same explosive growth has taken place in foreign direct investments (FDIs). Foreign direct investment means that a foreign company or individual has control over a business in a foreign market. One expert says that there are 63,000 companies worldwide who have FDIs. McDonald’s, for example, opened their first overseas operation in 1967. By 2002, their total income amounted to 58 per cent from overseas operations. A McDonald’s opens every three hours somewhere on the earth. Two-thirds of the McDonald’s outlets are in foreign lands. The question arises, “why do organisations want to expand business beyond their national boundaries?” There are several reasons: 1. 2. 3. 4. 5. 6. 7.

Low labour costs. Access to specialist skills. Favourable laws and tax systems. Economies of scale. Direct access to new and growing markets. The ability to customise products and services to local tastes. The creation of trade alliances (like NAFTA) and common markets (European Common Markets).

It is predicted that each region will create their own common markets like SAARC for south-east Asian countries, or perhaps the Grand Souk for the Middle East Countries. Another strong force in the global economy is the use of offshore professional and operations centres. A great example exists in India. Many US and European service providers now have facilities in India to take advantage of the profusion of computer skills with English language proficiency available at low cost. Traditionally, business facilities were located close to the suppliers and customers. Technology has made it possible to locate operations anywhere in the world irrespective of where the market is. Therefore, a hospital in the US has its billing centre in India or an Insurance company in the UK may have claims processed in India. The World Wide Web and satellite telecommunications have brought service providers and customers located in geographically disparate areas very close. With this immense market potential, organisations are going to propagate into foreign lands as an essential strategy. It is estimated that in the year 2020, the six largest world economies will be the United States and five Asian economies— India, China, Indonesia, Japan, and United Korea. The emerging middle classes with economic power will comprise the bulk of markets. Most local markets will have a profusion of foreign companies through partnerships and franchises. We

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know that in the hospitality Industry, franchise operations started in the 50s. However, it has proliferated to a great extent as the quickest way to earn international brand recognition with worldwide quality of service and products. In India, practically every major global chain is represented either in organisation or restaurant business. Let us look at this concept further as it affects the hospitality industry.

Foreign Business Presence It is important to know how companies engage in international commerce. There are several strategies that can be chosen to do business abroad. Obviously, each has an impact on local HR practices. These choices are:

Export This strategy is employed when a company simply wants to sell its products and services abroad. They do so to increase their sales and revenues. There are several reasons for an export strategy: 1. Those companies that have spent large sums in research and development of products like to amortise their costs through large sales volumes. 2. When domestic markets are unable to sustain such costs, export seems a viable alternative. 3. Export is also chosen to offload excess capacity. Some companies have infrastructure and equipment to produce certain volumes of goods. When those volumes are not consumed in the local market, then export to foreign markets is a solution. 4. Many organisations export to earn valuable foreign exchange. This is so true for Asian organisations to earn hard currency to be able to buy modern equipment and supplies from international markets. 5. Some companies use export as a means of ‘testing the waters’ of their products and services in foreign markets, before they opt ‘set up shop’ that requires considerable investment. For example, Baskin-Robbins initially exported ice creams to Russia. Once they understood the local tastes, they opened 74 retail outlets, finally opening a full grown plant. 6. When products and services are outdated in local markets (especially in developed countries), there is always a developing country who can use older technology and products that come at cheaper prices. There are some disadvantages to exports, the prime ones being the cost of transportation, local duties on foreign goods, repatriation of funds in hard currency, cost of local distribution, and finally, the cost of the end product once it reaches the end consumer.

Licensing In this strategy, a licensor provides a license for the use of intellectual property rights to a licensee in the foreign land against a licensing fee. Intellectual property includes patents, formulae, patterns, copyrights, trademarks, brand names, methods, and procedures. Licensors provide the technical know-how and assistance while the licensee will follow the standards in an ethical and responsible way. The Licensee will also ensure the payment of the license fee as per schedule. An example is that of Coca Cola who give a local manufacturer the license to prepare and distribute the Coca Cola brand in a market. The parent company gives the rights for the use of their secret formula.

Franchising This is a method where a franchisor permits a franchisee to use its brand name provided the franchisee adheres strictly to the facilities and standards of the franchisor. This method is used especially in the hospitality

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industry when such strong brand names like KFC, Burger King, Sheraton, Holiday Inn, etc. lend their names to local operators. This is discussed in detail later.

Management Contracts In this form of alliance, the parent company sells its management expertise, procedural manuals, and technical support to a local operator. Here the key management positions are held by the parent company executives and specialists. The hospitality industry uses this method often. It will be discussed in detail later.

Foreign Direct Investment (FDI) This is another method of foreign involvement where the parent company has greater control on the operations of the enterprise by committing major funds to the operation. While licensing, franchising, and management contracts are some form of FDI, this method also involves financial investment in the foreign enterprise. This gives the parent company controlling rights to the business as also considerable profit—some or all of which, is permitted to be repatriated to hard currency (especially in Asian markets). Decisions for FDI are made when the parent company has done adequate research of the market that has shown reasonable indicators of success.

Joint Ventures This is a strategy where the parent company enters into an alliance with a strong local partner. They form an independent company, sharing the investment and profits as equal venture partners. A wonderful example is when Suzuki Motor Corporation went into a joint venture for small cars with the Government of India to form the Maruti-Suzuki Corporation.

Sole Proprietorship This is an option in order to have total control in operations and decision-making. A sole proprietary option has some advantages and disadvantages. The advantages are: 1. 2. 3. 4. 5.

The company is established with minimum formalities. The owner has independence and control. The business can easily respond to market changes. Profit goes to the owner. The personal supervision of owner ensures good customer service and staff motivation.

The disadvantages are: 1. 2. 3. 4. 5. 6.

Finance is limited. The owner is responsible for all debts. It is upto the owner to make the onerous decision whether to expand or not. The owner is completely dedicated to business. The business closes with owner’s death. The business is dependent on the owner’s skills.

Mergers A merger is where two firms amalgamate their capital and their operations. They form a new company, often through a holding company.

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Takeover A takeover is when one firm buys the controlling share in another, preferably by cash.

Acquisitions Acquisition involves the purchase of an already up and running business with an existing set of suppliers and customers. Hence, a company is able to settle into a foreign market more quickly than if it were a start-up company. This is a strategy adopted by major conglomerates. Conglomerates are holding companies with subsidiaries in a wide range of unrelated industries. They seek out underperforming enterprises and with superior management turn them into profitable companies.

De-mergers These are the shedding of unprofitable enterprises within a group and concentrating on successful ones. A foreign company may look at a de-merging local company, opt to buy the loss-making enterprise and turn it around with superior management and brand name.

Hospitality Foreign Collaborations By the 1950s, hotel and restaurant chains in the US had created brand names of quality and consistency. They found it was time to export their expertise and did so at great speed by offering franchises. Soon, individual owners in local markets could not compete with large organisation chains, and therefore, merged with chains such as Sheraton, Hilton, Hyatt, Holiday Inn, Ramada Inn, etc. The international chains offered the following relationships to individual owners: (a) Partnership—Sharing equity and profits (b) Franchise—Providing name and association against a fee (c) Management Contract—Providing professional managers, technicians, manuals, systems, etc. on the basis of management fees and a share of profits as incentive payment.

Partnership A partnership occurs when a chain and an independent investor jointly finance an organisational project. In such cases, both become owners of the property and bring to the table their individual expertise and talents. They share in the profits and liabilities on an equal basis. Another arrangement that is popular nowadays is the straight lease agreement. An organisation chain reviews a property built by an investor, who then leases the property to the chain on an annual lease basis. The owner becomes a landlord and does not interfere in the operations of the property. The chain becomes the tenant and is responsible for all taxes and recurring municipal fees paid from the operations. Another arrangement is the sale of a property by a chain and leasing it back from the new owner on a lease basis—management contract or franchise arrangement. Chains opt for this when they want capital funds for other projects or when they want to reduce direct investment as a strategy.

Key Features of Partnerships l l

Both partners are accountable for all liabilities and debts and are bound to honour them. A partner can bind a partnership with a third party.

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Partners share profits according to arranged agreements. The name of each partner must show in each document and the business address.

Advantages of Partnerships l l l l l l l

Partners are flexible as they are close to the actual operations. Legal and financial procedures are relatively simple. Divisions of duties of partners are based on trust. Partnerships are not bureaucratic. Partners can substitute each other, if required. Partners can share the cost of common premises. Partners can raise additional funds by having more partners.

Disadvantages of Partnerships l l l l l

They are responsible for all liability. The withdrawal or death of a partner will dissolve the firm. Any partner can enter into an agreement that binds the others. Decision-making is slow as the partners have to agree. Shared control means that partners have to agree on everything.

Franchise A franchise is a license given by a franchisor to a franchisee who can be an individual, partners, small corporation, or group of investors. The question arises why an organisation takes on a franchise? A franchise is given by an organisation that has over the years developed a worldwide brand name of consistent quality. A guest will know exactly what to expect from a brand name. Especially in foreign travel, guests are circumspect of the standards of unknown organisations. A known brand name immediately gives comfort to the guest. Also, a franchise generates large revenues through referral business. For example, all Holiday Inns in the world become sales persons for the franchisee in a location. Finally, franchisors of a franchised organisation have their established central reservation systems for travellers worldwide. We can pose a question for the Franchisor—Why does he/she give a franchise? Doesn’t the organisation run the risk of losing its reputation? The truth is that franchise is the fastest way to expand overseas. First, captive investments are expensive for any individual corporation to finance. Second, any new franchisee becomes a new salesperson in a location for the other franchised properties. Third, Franchise fees are big sums of revenue without direct investments. The franchisee is given a license to use the franchisor’s concept of business, methods of operations, and name. Both parties sign a franchise agreement which is a contract that spells out the obligations of both parties. One important aspect of the agreement is that the franchisee is required to maintain the quality standards of the franchisor. Quality standards include the following: 1. 2. 3. 4. 5. 6.

Building materials Heating or airconditioning Size of guest rooms Type of décor and materials used Minimum type of trained professional staff required Hours of operation

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7. Hygiene and cleanliness standards 8. Procedures for service. Franchisors provide the following: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14.

Site selection and architectural design Interior design Central purchasing and economies of scale especially of equipment and service ware Systems and procedures manuals Global marketing Worldwide corporate advertising Merchandising material Use of logos on local advertising and merchandising Use of logos on service ware Central reservation system (separate fee for this) Training programs A regional manager who supervises the standards of operations and provides technical support Audits and inspections Credit or finding finance.

The franchisee gives an initial franchise fee and gets in return the permission to use the trademark name, designs, systems and procedures manuals, and consultancy. Thereafter, the franchisee gives a monthly royalty based on the following possible terms: 1. A percentage of room revenue in the case of organisations or food and beverage sales in the case of restaurants 2. A percentage of total sales 3. A fixed monthly fee 4. A fixed monthly fee plus an amount for each room reserved by central reservations 5. A fixed amount per available room 6. A fixed amount per occupied room.

Management Contract A management contract is entered into by a chain and individual organisation owner. The owner opts for a management contract to get international recognition, international expertise, and a profitable operation. Sometimes, the owner is not fully proficient in the art of running the hotel and prefers to hire experts who can bring the hotel operation to international standards. He/She may opt for international chain management because he/she cannot get such expertise locally. The chain sends specialists like the General Manager, Food and Beverage Manager, Executive Chef, and Rooms Division Manager. All sub-staff will be hired locally and trained by the chain’s corporate trainer. The owner becomes the dormant partner in operational matters and only intercedes when finances exceed approved budgets. All operational expenses are borne by the owner. The management fees under a contract can be as follows: 1. A fixed percentage of net income. The amount would be from three per cent to eight per cent of revenues. 2. A fixed percentage on gross operating profit that allows the owner to charge operating expenses at will, especially local advertising costs, but has to run the operation profitably. This could range from 15 per cent to 25 per cent.

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3. A combination of both which can be three per cent to five per cent of income, and five per cent to 10 per cent of gross operating profit. The arrangement is confirmed through a management contract that stipulates the following: 1. 2. 3. 4. 5. 6. 7.

8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23.

The management fee structure and the schedule of payment. The number of experts hired by the owner. The cost of the experts paid in hard currency at international salaries. That the chain management are only agents of the owner and not liable for any litigation. The chain can provide expertise in architecture, interior design, facility planning, engineers, consultants, and project managers whose fees are paid by the owner from the project budgets. Such project specialists shall be onsite when required, especially when critical equipment is installed. Provide pre-opening services like recruitment, training, promotion and publicity, selection of suppliers, procurement of licenses and permits for various services, and planning and execution of the inauguration. The owner provides cash flows for daily operations. The owner bears all operational expenses. The owner pays for all law suits. The General Manager assumes full responsibility of operations. The General Manager provides the owner with capital and operational budgets for approval and maintains the books of account open to review and audit by the owner at any time. The General Manager will provide annual, tactical, and strategic business plans. The General Manager will provide reports and statistics of performance on a periodic basis. A clause for a fixed contribution to the chain’s promotional budgets. A clause that clarifies the responsibilities of non-operating expenses. International standards are brought in by the chain with appropriate operations manuals. The chain shall provide training of local staff to those systems and procedures. The chain shall give its brand name. The chain shall provide a central reservation system that all properties worldwide shall use to provide services to the guests of the organisation. The chain management shall observe all local laws, practices and customs, especially those of a religious nature. The owner shall provide basic minimum infrastructure and standards as per the specifications of the chain management. The chain will include the property in its global advertising campaigns.

With this background, we can now see what concerns arise for the Human Resources activity.

HR Concerns in a Global Economy The turbulence and excitement of globalisation has posed some interesting challenges to local HR practitioners who have to integrate international practices with local ones. Here are the main concerns: 1. The immediate concern is the cultural integration. Foreign ways to do business may differ from local practices. For example, an American likes to conduct business at a bar over drinks, while in certain cultures people may prefer to conduct it in a board room preferring not to mix business with pleasure. A simple handshake as a form of greeting is taboo in other cultures especially when it involves women. Middle-Eastern women do not believe in physical contact. Americans like to get

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2.

3.

4.

5.

6.

to the business agenda immediately, while Japanese businessmen like to develop a relationship first before discussing business. Sometimes, the business agenda in Japan may arise after several social meetings. Foreign companies have to go through culture orientation programmes when entering foreign markets. This is the responsibility of the HRD department. The next challenge is to create a mix of foreign and domestic workforce. The decision is largely based on the availability of local talent and specialists. Most governments insist in providing employment to the local populace to meet their social objectives. Some local people may not be ideal, especially in customer contact positions, but force there way into work contexts because of social protection. In India, the movement to reserve few vacancies for some sections of society is gathering momentum. They may not have the requisite competencies for some positions but are hired due to the reservation policy. The HRD Manager may decide to send local staff to the parent company abroad for training at a cost. Alternatively, the enterprise may engage the corporate trainers of the foreign parent company to train the local workforce on site. Foreign companies do not mind engaging local hires in Asian countries because the labour cost is low. However, this approach has its own hazards in terms of the quality of workforce. The hospitality industry has been fortunate to get local staff that can be easily trained to international standards. Language is also a great challenge for this industry. Asian employees, in particular, may have a problem in reading and understanding the international systems and procedure manuals which are in English. The HRD manager has to translate the procedural manuals into local language before the staff is trained. Even when engaging corporate trainers from the parent company, the training classroom has to have an interpreter to translate the lessons. A country like India, which has a strong English speaking population, has an advantage over those countries where people do not know English. Many US and European countries have chosen to outsource their businesses to India because of the ability of the Indian employees to process work in English. China has taken strong initiatives to introduce English as a compulsory language from primary school itself in recognition of the global opportunity of a English speaking population. The next challenge is in the area of recruitment. It is difficult to find people locally exposed to international standards. Their awareness and skills may be well below expectations. The HRD manager has to evaluate the potential of individuals to learn international practices. It is, therefore, not uncommon to find HRD managers hiring people with higher qualifications to enable a quicker transfer of knowledge. Training is the next major challenge to bring local skills to international standards. People who are not exposed to skills may find it difficult to understand and imbibe a change of behaviour. For example, call center employees in India are required to speak in a particular accent when speaking to international clients. The accent may be difficult to transfer especially when they are used to the local accent. HRD managers have to send them to special coaching classes. Local standards of living may not be suitable for expatriates from developed nations. Food, potable water, housing, electricity supply, security, etc. may be difficult, if not traumatic, to foreign employees. The HRD manager has to work hard to provide proper living conditions to expatriates, sometimes at a tremendous cost. Organisations give hardship allowance to their employees working in difficult living conditions. Security is a major concern in a world faced with terrorism. We hear and read of kidnappings of foreign workers to get political mileage. Expatriates expect strong security arrangements for their personal safety. These include having secure compounds like in Saudi Arabia or housing in diplomatic areas.

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HR Strategies in a Global Economy We have seen that HR has to address a number of complex issues including political, cultural, economic, and legal systems. This is especially relevant when large international organisation chains expand abroad. This requires the corporate to have certain mindsets when venturing abroad. International chains choose among four HR management strategies to manage different scenarios. 1. One is the centralised-decentralised approach. Here the organisation will leave all decisions to the corporate office of the parent company. They will send key managers who are on rolls of the parent company to lead the operations in foreign land. Most of the rank and file will be from the local population. The HR manager also will be a local person because of his/her knowledge of the local labour market and laws. The local manager will be able to understand and manage the local workforce more competently than an expatriate. Organisations adopt this approach for several reasons: (a) They believe that they have superior management practices to make the organisation succeed (b) They are cost effective as they employ the local population while meeting the social objectives of the local government (c) They believe that local workforce can be trained to international standards (d) They shield an expatriate workforce from a cultural shock in a foreign country. 2. Another is to have a decentralised operation. This means that the foreign organisation operates as an independent unit with a high level of decision-making authority. The management leadership is provided by qualified and competent local talent which has already proven themselves in those conditions. The parent company gives sufficient amount of autonomy to them on the belief that the local conditions are unique to that country. The local organisations then create their own policies and strategies that are the most effective in the local circumstance. Such managers are specifically hired for the subsidiary and cannot be transferred to the parent company. It is quite possible that the General Manager of a organisation is initially from the parent company till a local incumbent is ready to take over the leadership. Some governments tend to insist on this policy as a measure of transfer of knowledge and self-sufficiency. Most countries adopt this strategy to fulfill many considerations such as labour cost, local laws, social policies, etc. 3. A third approach is to have a combined workforce. In this approach, the relationship between the parent company and the subsidiary organisation is very collaborative with joint decision-making processes. There is better sharing of information with a common perspective. The subsidiary then, can consider having a true multi-cultural workforce that can be deployed elsewhere in the world. Key positions are held by the most qualified members of the team, regardless of their national origin. 4. Another approach is to have third country nationals running the subsidiary organisation. The Gulf States pursue this policy as they do not have indigenous talent. In the Gulf, the rank and file is hired from Asia where talent is cheap. The subsidiary would, therefore, have a multi-cultural workforce of nationals from India, Sri Lanka, Pakistan, Nepal, and the Philippines. The management may, however, look at the best leadership talent from anywhere in the world. The accent is on competency and cost effectiveness. The challenge to the HR Manager in such a scenario is to maintain different salary criteria based on the origin of the workforce. This is particularly true of management where salaries and benefits may differ vastly. Quality management from Asia may come at a lesser cost than those from the US and Europe. This is a cause of dissatisfaction among the Asian talent. To overcome this, some organisations set a pay criteria based on the job and will search the world for a person to fit the pay scale. It is possible that they do not get the best talent.

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The Gulf provides free accommodation as a strong benefit to attract the best talent. The rank and file is kept in large captive labour compounds which are self-contained with recreation centres, grocery stores, sports facilities, and health clinics, while the management may rent houses of their choice within budgets. The HR manager is challenged to provide living conditions acceptable to all. Europeans require different basic conditions while Asians are comfortable with certain conditions not acceptable to Europeans. In the hospitality industry where duty meals are provided, the type of food becomes a challenge. A chef has to bring to the table an array of cuisines to suit the palates of a multi-cultural workforce. In countries that employ third country nationals, investment in training and development is minimal. The subsidiary organisations incur training costs to improve immediate performance only. Career planning and development is not an option. There is a fear of high employee development costs as they perceive the workforce as migratory which may leave after such investment. The HR manager is confronted with another challenge and that is managing ethnic groups within the workforce who jostle with other ethnic groups for better postings, and to get more of their country people into the workforce. The inter-ethnic rivalry has to be managed. 5. Another version of HR strategy is to adopt regional recruitment. So, subsidiary organisations in Europe will employ Europeans only, while subsidiaries in Asia will hire Asians only. This approach widens the labour market within a region to have a better choice. Since the cultural differences in a region are minimal the employees are more tolerant of each other. Parent companies adopt this strategy when they have strong regional offices where local recruits understand the laws and culture of the region. The salaries and benefits offered would adhere to regional norms. The company adopts a region-centric approach when it foresees rapid expansion within a region requiring qualified human resources in the future. The company will hire a resource from another country in a region in preparation of positioning him/her in the home country later.

Employment of Expatriates HR positions expatriates (employees from another country) for various reasons: (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k)

To create a global team with global competencies and focus To facilitate the transfer of knowledge and skills from a parent country to the subsidiary To monitor the standards of products and services in the subsidiary To offset the unavailability of local talent To mould local talent to the culture and standards of the parent company To cater to the specialist jobs that are unique to the parent company To oversee the business interests of the parent company To bring about better coordination between the parent company and the subsidiary To bring prestige to the organisation (used extensively in the Gulf States) To negotiate with suppliers and customers who are headed by expatriate staff of the same origin To coordinate with other business units of the same company easily, with the objective of developing synergy (l) To draw support from the regional offices of the parent company (m) To foster better information sharing between the subsidiary and the parent company for appropriate decision-making.

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Managing Expatriates—Challenges of the Local Organisation A local HR manager faces many challenges when hiring expatriate employees: 1. Expatriates are expensive. US or European expatriates maintain the home compensation terms and conditions. These translate into huge sums in local currencies, especially in Asia. One estimate is that the cost of a manager triples as soon as he/she is sent on a foreign assignment. 2. Expatriates want their salaries to be repatriated to their home country in hard currency to meet their various domestic obligations. 3. Expatriates want better standards of living. They would have to be provided prohibitively upmarket local accommodation that compare with their standards at home. 4. Expatriates want to return to their home country frequently during an assignment to touch base with their life-styles and recharge themselves (imagine an American who cannot drink in Saudi Arabia due to local religious considerations!). 5. Expatriates require additional security because of threats of terrorism. 6. Expatriates demand comparable schooling arrangements which may be prohibitively expensive in Asian countries, or they may enroll their wards into expensive boarding schools back home. They expect the subsidiary organisation to reimburse the educational costs. 7. Expatriates expect the subsidiary to pick up their relocation costs which include transfer of home goods, transportation, and incidentals. 8. Expatriates expect hardship allowance in some locations which translates into an additional head in the compensation package. 9. HR managers in parent companies have to prepare the expatriates for foreign assignments. This includes cross-cultural and language training. 10. Expatriate families where the husband and wife are pursuing independent careers can be a problem. The family is forced to separate. The subsidiary has to bear the cost of the spouse visits to maintain contact. Alternatively, the spouse may insist on a suitable employment in the foreign location. Another way is to compensate the spouse for lost wages.

Managing Expatriates—Challenges to the Parent Company 1. In spite of compensating employees well for foreign assignments, studies show that there is a high (10–20 per cent) rate of attrition. 2. Expatriates leave their assignments prematurely because of family reasons, inability to culturally adapt and conflicts with local managements. 3. Studies show that 33 per cent are ineffective in performing their international assignments. This is because of their lack of motivation to adjust to foreign conditions. 4. Many do not like to be away from the corporate with the fear of being forgotten when advancement opportunities arise. 5. American and European organisations are unable to attract high-performers for foreign assignments especially to troubled spots. 6. Many of them are not trained in holding international assignments and try to impose their style in local conditions. 7. HR managers of parent companies have to devise fast track career plans for those who volunteer for foreign assignments.

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8. Studies show that as high as 50 per cent expatriates leave within two years of returning to the home country due to reverse culture shock and a lack of concern by parent companies to give the expatriates some benefit of their international experience in terms of career benefits, repatriation cost, and more compensation. Asians may find this bizarre as most Asian expatriates vie for foreign assignments. At the moment, it is the western nations that are entering Asian markets and not the other way around. We have seen a few big Asian corporations making moves for foreign acquisitions and will in future perhaps have Asian talent moving into expatriate role. However, studies of Japanese expatriates show that 68 per cent of them think of returning home. While the average tenure of an expatriate is for a year or less, there are four types of tenures for expatriates: 1. Short-term assignments which are typically project based and may last for a few weeks only. Expatriates operate from a organisation and are treated as though they were on a long business trip. They are sent to ‘test the waters’ and may use the local embassy for useful information and leads. They would have set up meetings with several interested local partners and will pursue those leads and hold business meetings. They are the forerunners to the next developmental stage. 2. Developmental assignments are those where the expatriate is stationed for less than six months. They are sent on preliminary studies to evaluate markets, make governmental contacts, develop business alliances and study social and cultural conditions for possible future business. They may stay in a temporary furnished accommodation and will return when the task is complete. They will maintain close coordination with their parent organisation. They are not given family status, but are permitted to bring their family on a holiday on company expense. The HR manager will try to identify a ‘single’ marital status person. They will engage local agencies to get more authentic information about the markets and consumer behaviour. They may even conclude the formal agreements with local partners. 3. Strategic assignments are long term, usually over a year when they require the country manager to setup the organisation. They would hire local managers who will ultimately take over the operations of the organisation. Such people are given family status and permanent accommodation. 4. Long-term assignments are for career expatriates who want to make foreign assignments their specialty. They would typically move from one country to another because they have learnt how to evaluate and convert local opportunities into business ventures. They are given family status and given permanent compensation consideration in foreign countries. Such persons are rare, but are very valuable to an organisation which is thinking of aggressive expansion abroad. They may be titled Business Development Managers to reflect their true role. They would typically do the development work, start-up work, and train local managers to take over the business before they move elsewhere. Sometimes, they may be developing two or three business opportunities in a region and are comfortable with frequent travel. Such expatriates are comfortable in different cultures and may even adopt local languages and customs. They like the freedom and look upon the unknown as a challenge.

Profile of an Ideal Expatriate The future demands globally competent leaders. Here are some qualities required for those considered for foreign assignments: 1. They look at foreign assignments as exciting and challenging.

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2. They are able to adapt to cultures because of their knowledge of these, as also their willingness to adapt. 3. They are integrators to be able to look beyond cultural differences. 4. They are diplomats who are sensitive to local customs and practices. They are able to work through local objections to accept world standards. 5. They absorb the best practices from various places and are able to merge them into other operations and their own. 6. They have an in-depth understanding of world markets—their potentials and problems. 7. They are aware of global supply chains and distribution channels. 8. They are adventurous and are willing to try out new cuisines and participate in local customs and rituals. 9. They are fluent in the English language and may even take crash courses in other languages. 10. They are not insular and look to integrate with the local populace. They enhance their experience by visiting local sites and fairs. 11. They are excellent in their area of specialisation, especially business management. 12. They are always in a state of learning and are very inquisitive of the ways things are done locally.

Managing Local Workforces in a Global Economy Just as the HR manager is challenged in managing expatriates, so does he/she have certain challenges of managing the local workforce in an organisation of an international organisation chain. The HR manager has to find: 1. Local talent with international standards of knowledge and skills, or those who have the potential to develop them quickly. Naturally their priority will be to select those with prior international experience or those who have worked in multinational organisations before. They are not easily available. 2. Locals with the requisite skills to manage the technology and processes that foreign companies bring in. 3. People with multi-lingual skills. Proficiency in English is a must to understand and be trained into international standards and systems. Most businesses use English as their main language of conversation. 4. Those who have the physical attributes and presence to represent a multinational organisation. This is particularly true for customer contact jobs. 5. Those who are comfortable in working with multicultural work teams and those who have some knowledge of foreign customs and practices. 6. Those who are not racist. 7. Those willing to gain new knowledge and learn skills and be able to adapt to new organisation styles. 8. Those who are progressive and have modern thinking. 9. Those exposed to international lifestyles and who are able to adjust socially with foreigners. 10. Those who show the potential for foreign assignments in future. 11. Those with high productivity and physical fitness.

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The Typical Organisation of the Future Organisations in the new age will bear little resemblance to those of the industrial age. The typical organisation of the future will be knowledge-based. It will be composed largely of specialists who direct and discipline their own performance through organised feedback from colleagues, customers, and headquarters. The organisation will be information-based propelled by reliance on technology. The information generated helps in analysing and diagnosing the operations on a moment-to-moment basis. Take, for instance, the engineering department of a traditional hotel. Earlier they had a retinue of engineering supervisors spread across the organisation to monitor all aspects of engineering—be it boiler plants, electricity consumption, water consumption, or fire prevention systems. Today, all information comes to a panel in a central control room. One engineer can now visually monitor the health and status of engineering systems from a central point. Many faults can be rectified from the control panel itself. The future organisation will be forced to be information-based. Workers will no longer be considered as manual or clerical, but knowledge workers who will resist the command-and-control type of leadership. Instead, they will like to control their own work environments like entrepreneurs. Take, for instance, a receptionist—the moment she checks in a guest, she has total control over the guest’s movements. She issues the guest a bracelet that tracks the guest’s movement in the property. This is useful to page the guest for communication. The guest will use the bracelet to record any purchases in the property by simply swiping the bracelet over bar codes. The sale department will instantaneously record the sale on the guest folio. The receptionist can now track the guest’s expenditure, especially when it reaches credit limits. She does not have to rely on a night auditor to alert her on credit limits. As a matter of fact, the night auditor’s role becomes redundant as computers churn out the reports required for decision-making. It will also alert on discrepancies for the receptionist to pursue. We see that the receptionist has far greater control on her work, but will have to possess knowledge and skills to process and act on this information. Earlier the computer was used to churn out data. Now it will be configured to bring out information for decision-making. Information will be endowed with relevance and purpose. No wonder major capital investment is being made in information technology. Computers produce spreadsheets on any aspects of operations for instant decision-making. They not only produce information but also analyse the information to make decisions more accurate. It is only natural that the middle management that did the processing work and acted as police persons and as relays to top management, are no longer required. The typical large organisation will have fewer than half the levels of management, and no more than a third, the managers. The reason is simple. The frontline knowledge worker is doing all that now. As a matter of fact, the top management is monitoring their progress and will make such tactical interventions to reinforce the frontline worker. For example, a food and beverage manager will be able to redeploy resources from a restaurant, doing lean business in a shift, to another restaurant doing brisk business by monitoring the tables occupied in the respective restaurants through the information data sheets and closed-circuit T.V. The information-based organisation will require far more knowledge workers (specialists) than in traditional command-and-control companies we know today. These specialists will be in operations and not the corporate office as it used to be. Operations will be teams of specialists of all kinds. The corporate office’s new role will be to advise, counsel, and support operations. Because of flatter structures, knowledge which was the privilege of top and middle management, will now filter down to lower levels. In the information-based organisation, knowledge will primarily remain at the bottom. The corporate will seek information from frontline operators to make strategy decisions. This is something like a medical clinic. The doctor refers a patient to several lab

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specialists to conduct tests and give reports before making a decision. The corporate will formulate strategies based on specialist feedback received from the frontline employees. Each department in operations and the specialists that work in them will be guardians of standards— centres of coaching, innovation, and continuous improvement. Research will now be possible within departments (and not as an external activity) as the specialists would be within their ranks. These specialists may work in teams to resolve problems and come up with solutions and new ways of doing things. One thing that is clear is that the knowledge workers will require greater self-discipline to execute their autonomous responsibilities. They will be responsible for providing information to others and managing relationships within and outside the organisation. The future organisation will resemble an orchestra. There will be one conductor who directs specialist instrumentalists. Each member is knitted together by a musical score sheet that will be the organisation, vision, and objectives translated into actions, i.e. the systems and procedures in an information-based organisation. Each member will know when and how to perform. Each member has to be a master of his/her craft because one mistune can ruin the whole performance. Each player in an orchestra maintains tremendous self-control and does not enter till it is required. The conductor has to be knowledgeable of the score sheet as also the capabilities of all the members to produce the perfect performance. The conductor cannot tell the specialist player how to play the instrument, but can harness that skill to be an asset. The conductor monitors the progress of performance through feedback, i.e. the music generated. The ‘conductor’ in an organisation too, will depend on moment-to-moment feedback to know how the performance is going. His/Her primary role is coordination. Part of this feedback is brought through information technology. It is also important to define what information is required. This is built into the systems and procedures. It is clear that to survive, all organisations must move towards an information-based organisation. Organisations have to change old habits and move to new ones. The HR manager must be sensitive to the challenges that may arise when moving to an information-based organisation. Some of these are: 1. It will threaten a great many people in terms of their jobs, status, and opportunities. The middle-aged employees will be the most effected because they have not acquired knowledge specialisation and are least mobile in terms of other job opportunities. 2. To develop career opportunities for specialists. While many specialists may be happy with financial rewards and incentives they will be stymied where job advancement is concerned. Organisation chains have created positions of Area Housekeepers, Regional Housekeepers, and Corporate Housekeepers to give the housekeeping specialists a growth line. 3. Creating a unified vision with specialists. They must be able to see the big picture and not be isolated in their own specialism. One method employed is to occasionally make them part of cross-functional teams to resolve organisation problems. 4. De-layering the organisation and assigning roles to top management and frontline workers. Managers have to move from command-and-control attitudes to supportive ones. 5. Converting existing workers to knowledge workers. 6. Recruiting good quality knowledge workers who know what is expected of them. 7. Bringing about greater self-discipline among them to manage their new found responsibilities autonomy. 8. Introducing unique development programmes to challenge and enhance the mastery of specialists. Managers will have to return to business schools. Some may ask for sabbatical which needs to be given to develop that cutting edge. Who will do their job in their absence? What changed compensation

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9.

10. 11. 12.

will the person expect upon return? Can people be released for training especially in frontline jobs? These are questions that have to be answered. Providing organisation flexibility through cross-training. Most specialists want to stay within their specialisation and will cross-train within the function only. They are unlikely to move to other functions. Compensation structure has to be flexible to adapt to the financial aspirations of specialists. Today a specialist can command his/her price. Preparing succession plans for management. If the workers are specialists, how does one create the transition to management? Creating innovative titles for knowledge workers. Do positions in an information-based organisation carry any rank at all? Most specialist Managers like names that reflect their specialism, e.g. Housekeeper, F&B Controller, Guest Relations Executive, etc. The challenge is at the worker level. We cannot think of them as receptionists, room attendants, waiters, etc. Their roles change dramatically from these roles in information-based organisations.

Organisations are moving into a third phase of development—from command-and-control stances, department and division orientation, to the information-based organisation filled with specialists. This requires a change in the vision, values, and structure of the organisation. The sooner organisations move in this direction, the better geared would they be to compete in the emerging market environment.

Summary Human resources have come a long way over the centuries from slavery to those who make the difference in the success of an organisation. This is never so true as in a service organisation where the human resource is an important asset. In hospitality, the human resource provides the guest experience. To be able to give good service, HRD has to go into the inner motivations and aspirations of employees. Indian society must overcome the crippling legacy of the caste system to make hospitality attractive to its people. Societies, over the years, have moved from agrarian to industrial and are presently in the service age. Each age had its peculiar concerns and approaches to managing human resources. The service age is driven by information technology that has crossed global boundaries making the world a common market. Political boundaries have broken, making foreign direct investments and other innovative business relationships more possible. This has brought new challenges to the HR manager in integrating a multi-cultural workforce. One thing is for certain—and that is change. The more organisations and its workforces are flexible in adapting to new ways of doing things, the better are their chances of survival. HRD is in the centre of this transformation.

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Key Terms Slavery Serf Guild Capitalist Productivity Labour Union Potential Resource Knowledge Worker

Line Managers Quality of Work Life Knowledge Capital Strategy Outsourcing Expatriates Franchise Management Contract Foreign Direct Investment Joint Venture Merger Takeover Acquisition

A practice where masters own people they vanquish and capture A bonded labour An association of artisans of a similar trade Person who owns the trade and industry of the country The output within a time frame An association of workers The capacity to be developed further A person or toll than can be used to achieve a goal A highly qualified and competent worker who processes complex information for decision-making and whose skills can be converted into currency Those who drive operations A work environment that motivates employees The inventory of knowledge and skills available in an organisation Long-term actions Hiring external contractors Employees hired from another country The permission to use a brand name for a fee A business relationship where an organisation hires management expertise from another The commitment of funds in a foreign land An alliance of two companies to commit funds to do business When two companies amalgamate their capital and operations When a company acquires the controlling shares of another The purchase of a company already in business

Review Quiz Short Notes 1. What are the HR concerns in a global economy? 2. What are the HR concerns in an information-based organisation?

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2 Human Resource Development 1. WHAT IS HUMAN RESOURCE DEVELOPMENT? Let us first understand what we mean by human resources. Human resources in an organisation are all the people (both men and women) who are employed by it to work towards its objectives. They include the permanent employees, part-time employees, and trainees. They are compensated for their work. Human Resource Development (HRD) is a philosophy to effectively manage people; it is driven by policies, procedures, systems, and processes that influence people (individually and in groups) to achieve the organisation’s goals. We have seen earlier the evolution of managing people from slavery to talent management. For the purpose of this book, we shall look at Human Resource Development as it is today, the most commonly used philosophy by most hotels. First, we must recognise the difference between HRD and HRM (Human Resource Management) philosophy and practices. We know that HRM preceded HRD with a different approach to managing the human resource. Simply put, HRM focusses on productivity, while HRD focusses on potential.

2. HRM vs. HRD HRM HRM traditionally has been more reactive than proactive. Its main focus is on the following:

1. To Improve Productivity Productivity is the performance output in a given time frame. Hotels like to optimise the productivity of an employee in a given shift. This intention is reflected in productivity standards, e.g. 16 rooms per shift for housekeeping room attendants, 8 covers for a waiter in a fine dining restaurant, etc. HRM develops people to perform to set standards and constantly evaluates ways to improve standards.

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2. Improve Quality of Work Life (QOWL) QOWL addresses what behavioural scientists call “hygiene factors,” i.e. those elements that cause dissatisfaction. The main element of dissatisfaction is pay. HRM looks at pay till it is no longer a deterrent to productivity. It is the principle item on the agenda when negotiating labour contracts. Hotels also provide benefits such as free duty meals, employee cafeterias, free transportation, company maintained uniforms, safe working environments, counselling services, etc. QOWL is meant to promote productivity and keep the hotel services running. HRM recognises this when framing its HR policies and practices, especially their compensation strategies.

3. Response to Environments HRM as we have learnt is reactive. It is influenced by external and internal environments. It is the meticulous balancing of this that makes HRM successful. The following diagram (Figure 2.1) illustrates the kind of internal and external influences on HRM. Internal Environments

External Environments

Union Relations

Labour Legislation

Business Strategies

Labour Market

Employee Capabilities

Competition HRM

Organisation Culture

Suppliers

Leadership

Standard of Living

Employee Costs

Social Changes

FIGURE 2.1 | Business Environments

Internal Environment This is the environment within the organisation. HRM is influenced by the following: Unions The attitude of the unions is important. Unions have traditionally been suspicious of management and vice versa. HRM responds to union demands and tries to get the most cost effective deal in labour contracts for the management. HRM believes in legal compliance giving just enough as per labour law. Business Strategies Strategies are actions to achieve long-term goals. HRM responds to business strategies rather than creating them. Strategy building in the HRM approach is the privilege of the top management. HRM stands by as a mere spectator at the time of formulation and responds to set strategies. Employee Capabilities These are looked upon as limitations rather than the opportunity to develop potential. HRM develops skills to improve immediate productivity rather than as a long-term investment.

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Culture HRM responds to organisation culture as something omnipotent handed down by the owner. It does not look at influencing that culture. The employees are moulded into that culture rather than them being the creators of culture. Managers believe in strict compliance and use the ‘carrot’ or ‘stick’ to achieve it. External Environment These are the influences outside the organisation that have a bearing on HRM and on which there is little control. Such influences are: Legislation There are several labour acts that impact the management of and the workforce such as the minimum wages act, laws on overtime, etc. There are now sweeping laws on employee health and safety. These have to be followed meticulously. Labour Market The labour market is the source from which a hotel gets its employees. HRM looks at sources that provide candidates at the cheapest cost. The result is that the hotel gets employees who are not competitive in terms of knowledge or competencies. Competition HRM responds to competition rather than leading it. New ideas are delayed in adoption due to bureaucratic procedures of approval. HRM dresses old practices in new jargon rather than exploiting their potential. Standard of Living HRM gives automatic annual increases as per grade rather than looking at performance bonuses and merit based increases. People work just that amount to earn the annual increase rather than excel to gain a special bonus. Social Change HRM looks at social changes (slow as they were in olden days) more as a nuisance than an opportunity.

4. Make the Human Resources Cost Efficient HRM looks at employees as costs rather than assets. HRM short changes the organisation by hiring people of low potential and attitude because of cost considerations. They offer the least amount as per the law. The challenge for a HRM manager is to keep the payroll costs within budgets handed by the top management.

HRD HRD, on the other hand, adopts a completely new philosophy. In the first place, it looks at employees as an asset with potential for development for the individual and organisational good. Potential, as we have learnt, is the capability to be developed into something higher. HRD, therefore, believes that: l l l l l l

Every person has a potential arising from his/her strengths. Potentials are of different types in different people suiting different roles and situations. In the same role people may have more or less potential. At any given time, whatever the level of achievement, a person’s potential is under-utilised. Potential changes in complexion with better utilisation. Potential can temporarily erode due to disuse or misuse.

To release potential, HRD has to create an organisational environment where it can be fostered and developed. The culture of the organisation creates the environment for potential to grow.

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The HRD Culture Given below are the elements that an HRD culture promotes: l l l l l l l l l l l l l l

Respect for each person’s culture Encouragement to the employee for participation in the affairs of the organisation Creates trust by bridging physical and psychological gaps (Managers are more accessible) Employees’ dignity and self-esteem Team feeling Evolution—on the belief that people and environments are constantly changing Congruence between individual and organisational goals Care for the employees Openness and candour—self-expression and feedback without fear Fairness Expert-based power—it gives importance to those with superior knowledge and skills Courage of conviction (assertive rather than aggressive) Individual autonomy—employees are given freedom within broad guidelines Shared values—both management and staff are guided by common principles.

HRD’s Main Purposes HRD’s main purposes are to: l l

l l l l l l l l l l

improve morale and motivation through empowerment and developing potential; improve competitiveness through better productivity, quality consciousness, cost control, systems discipline (i.e. following procedures), and excellence in the way things are done; bring about commitment and teamwork; foster participation of employees in organisation’s strategic intent; human development; be result oriented; ensure a safe workplace; develop enlightened employee/union relations; optimise the utilisation of human resources; improve work practices; develop rational structures to meet the business strategic needs; and introduce and organise technological disciplines.

3. HRD PROCESSES With these beliefs, culture, and purposes, HRD adopts appropriate processes (series of actions to achieve an end) in their approach to managing human resources. Following are the processes it champions:

1. Developing an Enabling Culture and Climate An enabling culture is one where the individual has the opportunity to grow and use his/her potential. This is done by: l

Changing the leadership style from autocratic, authoritarian, or bureaucratic to more paternalistic. Paternalistic leadership shows care.

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l

l

l l

l

Managers become mentors (senior people who act as guides) and coaches (personally train) who care for their people and want to encourage and prepare them for higher responsibilities. Managers bring a sense of belonging and teamspirit where achievement of results is celebrated, recognised, and rewarded. Managers break down physical and psychological gaps by being approachable and trusting, Managers develop HRD skills like goal-setting, performance appraisal, counselling, continuous learning, and self development. Developing a Learning Organisation to foster continuous education and self development. (see “Creating a Learning Organisation” in Chapter 10 for further details.)

2. Information Sharing HRD makes information more accessible and transparent. Earlier, the employee newsletter distributed information. Now Information Technology has created the intranet for this purpose. HRD believes: l

l

l

l

that an employee must know the organisation’s strategies and policies and also be aware of how the organisation is doing. that new employees are to be inducted well into the culture, customs, and practices of the organisation so that they can fit in easily. that formal and informal vehicles for communication are necessary to maintain a continuous dialogue. The briefing at the beginning of each shift is one such powerful medium of communication. that in encouraging employee participation in critical management decisions on the belief that they are the ones who translate those decisions into action at the work place.

3. Empowerment Empowerment is the process of making employees more powerful with sanctions of authority and responsibility. HRD is the champion that empowers employees. HRD achieves this by: l l l l

l

l

l

Developing greater knowledge and skills Giving more responsibility Giving more authority Providing greater autonomy to make decisions—frontline employees now make decisions that were hitherto the privilege of their supervisors on the belief that the modern guest wants immediacy and does not have the time or patience for bureaucratic decision-making Reversing traditional pyramidal organisational structures by making the people who create the guest experience, like the receptionist and waiter, more important The management consequently giving full support to the employees to enable them to make that service difference Creating enthusiasm in the employee ranks—making work fun rather than a chore.

4. Structures HRD will influence the structure of the organisation by removing bureaucratic layers. The organisation will be lean (fewer layers) for quicker decision-making. This is made possible by information technology that will supplement the gaps of information processing that several layers of management presently churns out.

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5. Develop the Knowledge Capital The hospitality industry thrives on its human capital. Employees, therefore, become assets to be built for greater contributions. This they achieve by: l l

l

Continuously developing individual potential to meet the organisations future needs Developing a performance management system that throws up individual potential and specific needs for training and development Dovetailing potential into career progression and succession plans (see Chapter 7, “Career Development and Succession Planning” for details).

6. Act as a Change Agent Change is the biggest challenge in modern times. Organisations are forced to restructure themselves to survive in global competitive markets. Internal processes and workforces too have to align themselves quickly to changing scenarios. HRD has a great role in this transformation process.

7. Enlightened Unions The objective of HRD is to develop a partnership with the union through transparency and trust.

8. Business Strategists HRD influences the organisation’s business strategy. To be able to do this, they have to be constantly alert to the following: l l

l

l

l

To the changes in business strategies so as to align the workforce to the new strategic needs. To be part of the top management business planning team to understand the change in thinking and advise management of the capabilities of the employees with regard to those changes. To develop capabilities to meet the needs of the organisation. For example, a hotel may introduce a new strategy to serve the business segment. The hotel, therefore, creates executive rooms and facilities to serve this segment. Now HRD has to train the workforce to the needs of this segment and how to respond to them. The employees must develop the capabilities to give excellent service to this new market segment. Give diagnostic feedback; sharing problems, opportunities, and desired directions; increasing behavioural skills to raise sensitivity to human behaviour and organisational effectiveness. Bring about systems discipline.

9. Leadership Development HRD will organise a few development programmes that will focus leadership skills in a progressive HRD direction. Such programmes would include: l l l

Mentoring Creativity Problem-solving and decision-making

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l l l l l l l l

Develop Theory ‘Y’ managers. (see “Managerial Leadership” in Chapter 12 for details.) Delegation Coaching Communication Use of MIS and technology Role modelling Systems discipline Time management

10. Talent Scouting The labour market is a great challenge to HRD. It is not the number of people, but their quality that is in short supply. HRD is constantly looking for people who show potential for higher responsibilities. Since quality staff is in short supply, the competition vies to attract the competent few with better compensation packages. HRD uses the following approaches to meet this challenge of attracting good people: l

l

l

l

l

l

l

Source the labour markets creatively to get the best talent. Hotels have looked at non-traditional sources like war widows, housewives, active retirees, etc. to get some good talent. Be alert to compensation changes by competition. HRD does this through surveys and Due Diligence (market intelligence) in order to keep the organisation competitive in the market. Outsource certain tasks. Outsourcing is a new and influential strategy in the way business is done. It means getting external vendors to do certain tasks and jobs important to the organisation. For example, a hotel may want to outsource its horticultural activity rather than employing a captive team. This means hiring a contractor and his team who has expertise in horticulture. HRD is often given the task of finding reliable contractors. The question is whether there are reliable and capable contractors available in the market. Sometimes, HRD has to train them to the hotel standards. Contract certain HR tasks to external experts. For example, experts who do job evaluation or manage assessment centres (see “Assessment Centres” in Chapter 10 for details), etc. Respond to the new worker. The external environment is changing. Along with it, the needs of the new workforce have also changed. For example, a potential candidate may want to work on commission or profit sharing as part of his/her compensation to earn enough to go on foreign holidays or purchase a new car. Respond to other social changes. For example, the surge of women employees in the workforces or legislation to provide employment to the underprivileged. Manage a knowledgeable youth. HRD has to integrate new generations with the old ones. Youth always look for change and are assertive enough to demand it. Older employees need to be trained to cope with change.

11. Teambuilding HRD has the exciting challenge to develop high-performance teams (see “Developing a High Performance Organisation” in Chapter 10 for details). Excellence in service is only possible through teamwork where each member of a team, and each team itself, is working towards only one goal of customer satisfaction.

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12. Develop HRD Sub-Systems HRD has to create, implement and monitor innovative and effective HRD sub-systems to meet the goals of all of the above. Such systems are: l l l l l l l l l l l

Job Analysis (see “Job Analysis” in Chapter 3 for details) Selection Systems (see “Selection Processes” in Chapter 4 for details) Induction Systems (see “Orientation and Socialisation” in Chapter 4 for details) Training and Development Systems (see “Training and Development” for details) Career Planning (see “Career Development” in Chapter 7 for details) Succession Planning (see “Succession Planning” in Chapter 7 for details) Multi-skilling through Job Rotation Reward and Recognition (see “Reward and Recognition Schemes” in Chapter 5 for details) Performance Counselling (see “Performance Counselling” in Chapter 5 for details) Participative Devices Human Resources Information Systems (see Chapter 13, “Human Resources Information System” for details)

13. Managing Costs HRD has the difficult task of maintaining human resource costs. This they do through several innovative ways: l l l

l

Developing a flexible workforce. Being creative in their recruitment and compensation strategies. Having a leaner workforce to manage costs by using technology e-order pads, automatic check-ins, automatic wake-up call systems, electronic messaging services, etc. to fulfil several functions Using innovative methods like providing tea/coffee stations or mini-bars in rooms to avoid the load on room service.

4. ROLE OF HRD It must be understood that the responsibility of human resource development is the management of an entire organisation and not the HRD department alone. The HRD department is a facilitator to the line management to manage their workforces effectively. Line managers are the managers in direct operations. They are said to spend 50 per cent of their time on human resource issues such as scheduling, hiring, motivating, coaching, disciplining, etc. Line managers seek the support of HRD to drive and guide human resource initiatives in order to maintain an effective workforce. Small companies may not have an exclusive HRD department but may leave this function to the owner/ CEO to execute. To put it very simply, the HRD department’s role fall into six broad areas of activity: 1. 2. 3. 4.

Planning the organisation’s human resource needs to strategic plans. Staffing the organisation in response to those needs. Appraising and compensating performance. Training and developing human capital.

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5. Establishing and maintaining effective labour relations. 6. Improving and analysing the organisational environment. If these were to be detailed into further activities, they involve the following:

Planning l l l l

Recommending human resources policies, procedures, and processes to the top management Planning the optimal size of the workforce and the skills required to achieve the goals Forecasting the organisation’s short and long term human resource requirements Creating an HR Budgeting to meet HR initiatives.

Staffing l

l

l l

l

Job analysis, Job descriptions, and job specifications (see “Job Analysis” and “Job Descriptions and Job Specifications” in Chapter 3 for details) Identifying and developing sources of supply (see “Sources of Human Resources Supply in the Hospitality Industry” in Chapter 4 for details) Hiring of the human resources (see “Selection Processes” in Chapter 4 for details) Completing all formalities of joining the organisation (see “Appointments and Joining Formalities” in Chapter 4 for details) Orienting and guiding them to fit the social milieu in order to make them productive in the shortest period of time (see “Orientation and Socialisation” in Chapter 4 for details)

Appraising and Compensating l

l

l

Develop and drive the performance management system ensuring that people are evaluated fairly and rewarded justly (see Chapter 5, “Performance Management and Appraisal” for details) Address the complex issues of a competitive and fair compensation and benefits (see Chapter 8, “Compensation and Benefits” for details) Develop and implement a reward and recognition scheme (see “Reward and Recognition Schemes” in Chapter 5 for details)

Training and Development l l l

Administer a career planning scheme (see “Career Development” in Chapter 7 for details) Train and develop the human resources to improve human capital Promote individual growth.

Employee Relations l

l

Work with the Union towards a healthy work environment for the employees (see Chapter 11, “Employee Relations” for details) Drive the health and safety concerns of a employees (see Chapter 9, “Employee Health and Safety” for details)

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l

l l l

l

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Handle grievances so that they do not effect productivity (see “Managing Grievances” in Chapter 11 for details) Maintain a code of conduct and drive disciplinary proceedings (see “Managing Discipline” in Chapter 11 for details) Uplift the employee morale through social programmes and schemes (Chapter 11.8) Maintain HR practices within the labour laws Manage concerns when employees exit the organisation (see “Employee Exit” in Chapter 11 for details) Introduce and manage effective employee social programmes.

Organisational Environment l l l l

Organisation Design and Development (see “Organisation Design” in Chapter 12 for details) Research HR practices and programmes Evaluate HR vendors to introduce best practices Operationalise HR Information Systems.

The above are discussed in detail in subsequent chapters (as shown in brackets).

New HRD Roles In addition to the above, HRD has added the following activities to its portfolio: 1. 2. 3. 4. 5.

Business strategy formulation HR policy formulation Culture building Creation of knowledge (and skill) wealth Agents of change

Let us look at each.

Business Strategy Formulation Hotel and restaurant owners and senior executives now believe that it is the people who create the cutting edge over the competition. HRD, therefore, plays a vital role in business strategy. They believe in a strong alignment of HRD strategies, policies, and practices to the business strategy of the organisation. HRD managers can now make a direct contribution as internal consultants to diagnose and transform organisational processes. HRD is evolutionary in approach with a ‘searching’ spirit. It is more insight-based than technique-based. The search is to move from people-focus to business-integration. Its critical contribution is the creation of business wealth.

HRD Policy Formulation While most policies are created by top management, HRD can contribute by giving information and recommendations. The specific types of information concerns are employee expectations, union expectations, line manager concerns, impact of the external environment—especially legislation, labour markets, competitive best practices, etc. Policies must be ‘enabling’. In other words, they must encourage frontline personnel and line managers to perform, rather than restrict performance. Organisations often create committees for strategy and policy formulation. The HRD manager is an important member of this committee.

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Creation of Culture HRD works closely with the owner/CEO in creating the value systems of the organisation and institutionalising them. Values are those components that create culture. Culture must be characterised by values such as openness, trust, expert-based power, autonomy, fairness, and healthy competitive spirit. This, they must do through personal demonstration first. For example, personnel information was in the sole possession of the human resources department in the HRM approach. They were the lord and master of information about the human resource. An employee had to get information from a grudging HR person about his leave, for instance. Now, the employee can track his/her leave record using the computer at his/her desk. Human Resources management has benefited greatly by technology. Technology has facilitated a shift from the bureaucratic methods used before to more transparent information systems. Employees now access policies freely through the intranet. HRD also demonstrates justice, truth, and has earned itself the reputation of being a department with a heart. HRD can create positive culture through the following means: l

l

l

l

HRD systems like transparent performance management, suggestion schemes, training and development, career plans, etc. Leadership development that brings out the best potential of individuals. They can train leaders as mentors, coaches, and facilitators. Team building to bring out synergy, team-spirit, and conflict resolution. In a counsellor’s role, they can play an important part in integrating suggestions by specialists with a common purpose. Motivating employees to have a sense of ownership and responsibility by creating a common vision and integrating their aspirations to those of the organisation.

Creation of Knowledge Wealth In today’s organisations, knowledge is wealth that can be converted into currency. For example, a chef who is a specialist in a certain type of cuisine can convert those skills into a business proposition for a hotel. To create knowledge wealth, HRD identifies people’s special talents to integrate them into business strategies. It seeks talented people in the market and influences them to join the organisation. They then tap that knowledge to meet the goals of the organisation and to develop themselves further. It continuously develops people through the creation of a learning organisation. HRD introduces such processes as career plans, succession plans, learning centres (see “Creating a Learning Organisation” in Chapter 10 for details), training, and development. Through these initiatives, HRD is able to achieve the following: l l l l l l l l l

Raise managerial and employee competence Strengthen systems discipline Deepen employee involvement Earn union partnership Develop the ability to handle greater autonomy Encourage continuous learning Encourage continuous improvement and innovation Develop better reward and recognition schemes Improve productivity.

Knowledge wealth must be able to achieve the following: l l

Improve competitiveness especially through innovation. Improve capital productivity by better maintenance and use of equipment.

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l l

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Improve material productivity by innovative use of material (e.g. recycling) and cost reduction. Improve managerial productivity to foster better utilisation of resources. Also, raise their creative, strategy, people, and leadership skills. Improve flexibility through cross training. Improve employee productivity through multi-skilling.

Agents of Change HRD plays an important role as an internal agent of change. As organisations change business strategy to survive in competitive markets, the human resource has to align its workforce with those strategies. The HRD takes on a diagnostic role to analyse the shift in human resource processes and then move to a transformational role to convert the existing mindsets and practices to those that suit the strategy. The HRD manager is a researcher who is constantly seeking ways to improve human processes and practices. A main contribution is organisational design (see “Organisation Design” in Chapter 12 for details). HRD must see the appropriateness of organisation structure to strategy.

Role of an HRD Manager The HRD manager is no longer a policeman, but a facilitator. He/She plays the following roles: l l l l l l l l

A searcher on a voyage of discovery Researcher to bring in best practices Insight-based person Strategic planner to be a co-partner with management Agent of change Counsellor Advisor Developer

5. ORGANISATION OF THE HRD DEPARTMENT The HRD department structure responds to its objectives. The typical objectives of a modern hospitality HRD department are: 1. To create proactive HRD policies that will foster high performance and release human potential and achievement. 2. To introduce best HRD practices in responding to the policies and business strategies. 3. To procure the best talent for the organisation supported by innovative compensation schemes. 4. To develop an individual to realise potential to the maximum extent. 5. To develop an individual’s capabilities to perform his/her present job better. 6. To develop capabilities to handle future roles. 7. To develop and maintain high morale and motivation of the workforce. 8. To strengthen superior-subordinate relationships. 9. To develop team spirit in various teams. 10. To promote inter-team collaboration. 11. To develop a positive organisational climate and health.

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HRD has some imperatives in their alignment with the organisation: l

l

l

l

l

The HRD staff must be where the action is. They cannot hide in basements or corporate offices. HRD is part of strategy and must work with line managers to accomplish goals. HRD staff must be easily approachable and transparent in their dealings. The HRD staff must be consistent in their application of HRD policies. It must be viewed as fair and objective. HRD staff is consulted in HRD policy-making and business strategy. They are ‘full partners’ of top management. HRD personnel have sufficient authority to help ensure that personnel policies are followed consistently and are implemented legally and affirmatively, without discrimination. HRD is pro-active through innovation and adopting best practices, and is not just a crisis responder.

The hospitality industry has appreciated the role and contribution of human resource specialists. We have recognised by now that people make the difference in a guest experience. Getting the right talent, training them, and motivating them to excellence requires several specialisations as we shall see later in the chapter. An owner of small properties like motels and resorts may assume the responsibility of human resources developer. Large- or medium-sized organisations may at least have a Human Resources Development Manager who may outsource many of the specialisations. Large hotels will have well defined HRD structures to fulfill the requirements of various specialisations. A typical HRD organisation structure of a large hotel would look like the following (Figure 2.2): HRD Manager

HR Information Assistant

Recruitment and Selection Specialist

Compensation and Benefits Specialist

Training and Development Specialist

Employee Relations Specialist

FIGURE 2.2 | HRD Organisation Structure of a Large Hotel Let us look at each Job position.

HRD Manager He/She is the head of the HRD function. It is significant to note that women are increasingly taking on this role. This is because women have entered the workforce in large numbers with appropriate education and career orientation. They are also believed to be more sensitive to human feelings and are better received by

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the workforce. While this may be clichéd thinking, the fact is that they hold most HRD positions in the west. Alternative titles of this position adopted by the industry are: Vice-President—HRD and Director—HRD. The title is given in relation to the size of the operation. HRD should report directly to the General Manager of the hotel. Corporate structures will have the HRD function report directly to the Chief Executive or Owner. It is in recognition that HRD is part of the strategy team and deserves non-bureaucratic decisions. The HRD manager should preferably be an MBA or with similar qualification, with specialisation in Organisational Behaviour and Human Resources. Such a person should have a minimum of two years of experience. The HRD Manager’s responsibilities are as follows. l l l l l l l l l

l l l l

l l l

l l l

l

l

l

Get the top management’s commitment to a progressive organisational philosophy. Recommend and get top management commitment to HRD policies. Develop an HRD plan that satisfies organisation business strategies. Develop, implement, and monitor HRD systems and procedures. Develop a learning organisation. Develop and implement a recruitment strategy that will get the best talent. Develop and administer a progressive compensation practice. Develop and implement an effective reward and recognition programme. Develop and implement an effective orientation and socialisation programme that will make new hires productive immediately. Plan and design new methods and systems to strengthen the organisation climate. Be aware of social and other goals of the organisation and direct HRD efforts towards them. Inspire unions in a partnership of progress. Organise, implement, and monitor developmental programmes for better performance, individual growth, and knowledge capital. Develop, implement, and monitor an effective employee heath and safety programme. Organise employee social and recreation programmes that foster a sense of belonging. Develop and implement an Affirmation programme that encourages diversity and other social requirements (e.g. reservations legislation, war widows, etc.) Develop, implement, and monitor the employee benefits programme. Develop an effective employee communications programme. Be responsible for community relations and participate in community programmes, e.g. environmental issues, cleaning the beaches, etc.) Research constantly the organisational health, effectiveness, and strategies to devise innovative inputs, e.g. assessment centres, structural modifications, employee surveys, job design, etc. Develop such suppliers/contractors/external specialists that can intervene in specialist HRD processes. They should be reliable, qualified, and experienced. Attend strategic and coordination meetings.

HRD Information Assistant The HRD secretary has come a long way from taking dictation and filing. We must understand that HRD information is now on mainframe databases. With work practices getting more hands-on, correspondence is done by the specialists in the function, and they may find the HR secretary’s role as superfluous. However, her role can be redefined proactively making her a knowledge worker who now processes the HRD Information systems (see Chapter 13, “Human Resources Information System” for details). Organisations have, therefore,

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re-titled her as HRD Coordinator, HRD Processor, HRD Communications Specialist, or HRD Specialist. She reports to the HRD Manager. She is the heart of HRD operations and is able to coordinate information. She should be computer literate, preferably with knowledge of HRD software and data process and analysis. She is also the moment-to-moment face of HRD. Her responsibilities are to: l l l l l l l l l l l l l l l

update HRD information in databases and be responsible for the HRIS, prepare daily/weekly/monthly HRD reports for effective decision-making, be the communications face of HRD department, follow-up on all HRD correspondence, offer basic counselling skills, create employee newsletters, coordinate employee suggestions schemes, quality circles, learning circles, coordinate and administer the learning centre activities, prepare HRD manuals and other HRD process documents, organise meetings and appointments for the department, schedule the use of meeting rooms, classrooms and offices, oversee the maintenance and security of the HRD office, databases, and confidential information, provide logistic support for training programmes, monitor data concerning career and succession plans, monitor data of performance and raise necessary red flags.

Recruitment and Selection Specialist He/She is a person whose main purpose is to get the best talent from the market within the compensation parameters of the organisation. He/She must keep recruitment costs to a minimum through innovative sourcing. He/She should ideally be an MBA, but a Post-Graduate Diploma in Human Resources is acceptable. She must have skills in job analysis, selection, testing, and interviews, and negotiation. He/She reports to the HRD Manager. The Recruitment and Selection Specialist’s responsibilities are to: l

l l l l l l l l l

analyse the organisation’s present and future human resource needs in relation to its present and future strategies; evaluate whether positions can be filled internally; conduct job analysis (discussed later) leading to job descriptions and job specifications; study the compensation parameters for each job; identify and develop reliable and least cost sources of supply; identify appropriate tests for the selection process; organise and conduct interviews and tests; negotiate salary offers that are acceptable to the organisation; prepare Letters of Offer and Appointment Letters; complete joining formalities.

Compensation and Benefits Specialist He/She is a specialist who is preferably an MBA. However, a person holding a Post-Graduate Diploma in Human Resources is acceptable. Some organisations consider a Masters in Commerce as well because of the

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ability to crunch numbers. The basic purpose of this specialist is to develop the compensation and benefits strategy that is competitive enough to get and retain the best talent for the organisation. The person reports to the HRD Manager. The responsibilities of the Compensation and Benefits Specialist are: l l l l l l l l l l l l

Benchmark the compensation limits with the most valued competition. Research into industry compensation practices. Devise innovative ways to compensate good talent. Devise a compensation strategy, policy, and plan. Recommend a compensation and benefits budget. Administer the compensation and benefits programme. Ensure salaries are paid on time. Prepare salaries and wages reports for decision-making. Administer the long-term benefits. Ensure all practices conform to labour law. Develop and administer the reward and recognition programme. Analyse and implement the performance appraisal recommendations for salary hike.

Training and Development Specialist This position has a vital role to play in developing the knowledge wealth of the organisation. The specialists basic purpose is to improve current performance and develop future capabilities for the organisation. Such efforts must be in alignment with the organisation’s business strategy. He/She would preferably be an MBA, though the Post-graduate Diploma in Human Resource may suffice with a hotel management diploma and experience in operations. The person must, therefore, have thorough knowledge and skills in hospitality. The responsibilities of the T&D Specialist are to: l l l l

l l l l l l l l l l l l l

recommend and influence a training philosophy for the top management; recommend and monitor training policies; develop a learning organisation through innovative interventions; conduct short- and long-term training needs analyses of the organisation in keeping with its business strategies; develop, implement, and direct the career planning and succession planning scheme; counsel employees on matters of performance, growth, and career plans; drive the management training programme of the organisation; prepare annual T&D plans and have them approved and budgeted for; coordinate closely with line-managers for performance enhancement initiatives; develop learning facilities such as learning centres, classrooms, self-learning, training equipment, etc.; identify, evaluate, and develop external experts for specialist training and development inputs; develop training programmes using the most effective training methodology; update the resource library; conduct training; develop the coaching capability within the organisation; develop line-managers as mentors; evaluate training to make it more effective.

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Employee Relations Specialist The incumbent should preferably be a Masters in Social Work or an LLB with a Diploma in Industrial Relations. The person would be thoroughly knowledgeable about labour laws with strong negotiation skills. He/She is the organisation’s face to the union. He/She reports to the HRD manager. The basic purpose is to maintain a harmonious labour climate through participation and partnership. The Employee Relations Specialist’s responsibilities are to: l l l l

l l l

l

l

l l

l

update on labour laws; inform and educate the union on emerging business strategies; ensure that the union is properly certified and correctly represents the employees; interact with employees and monitor their concerns—represent them to the management for remedial action, be proactive rather than reactive to employee issues; negotiate the labour contract; ensure that grievance procedures conform to policy and law; drive the social and recreation programmes (see Chapter 11.8, “Employee Social Programmes” for details) to foster a healthy workforce; drive the employee health and safety programme (see Chapter 9, “Employee Health and Safety” for details); Participate in the employee communications programme including newsletters, reward, and recognition events (see “Reward and Recognition Schemes” in Chapter 5 for details), suggestion scheme (see “Suggestion Scheme” in Chapter 11 for details), etc.; be responsible for employee housing, transportation, cafeteria, locker rooms, etc.; participate in disciplinary proceedings (see “Managing Discipline” in Chapter 11 for details) to ensure they are fair; front, on behalf of the management, any breakdowns in union-management relations.

The HRD Department’s structure is normally lean consisting of specialists who are self-driven and enjoy their area of specialisation and the challenges these offer. They may have support staff such as the payroll clerk, employee housing care-taker, cafeteria supervisor, nurse, etc.

Summary Human Resources Development (HRD) is a philosophy to effectively manage people. It is driven by proactive policies and processes to address human issues that can help achieve organisation goals and strategies. It differs from HRM in as much as it is proactive and focusses on developing human potential. It creates a culture of trust and partnership where the human resource shapes the future of the organisation. The HRD department, therefore, is a team of highly qualified specialists who enliven key issues of recruitment and selection, compensation and rewards, employee relations, and training and development to meet the changing business scenarios.

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Key Terms Belief Strategies Potential Candour Systems Discipline Process Mentor Coach Empowerment Due Diligence Outsourcing

Accepting something as true Actions to achieve long-term goals The capability to be developed into something higher Self-expression without fear Following procedures meticulously Series of actions to achieve an end Senior person who acts as a guide Personal trainer The process of making people more powerful by endowing them with greater authority and responsibility Market intelligence Getting external vendors to do certain tasks and jobs important to the organisation

Review Quiz Short Notes 1. What are the significant differences between Human Resource Management and Human Resources Development? 2. What are the purposes of HRD? 3. How do internal and external environments influence HRD? 4. What is the role of HRD?

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3 Hospitality Human Resources Planning 1. ORGANISATION VISION, MISSION, CULTURE, VALUES, STRATEGIES, OBJECTIVES, AND STRUCTURE Organisation Activities HRD helps in shaping the vision, mission, culture, values, strategies, objectives, and structure of the organisation. They are processes that define the direction, organisation, and action of the company. Though the vision and mission is strictly enunciated by the Owner/Chief Executive, he/she looks upon the HRD manager to give suggestions on vision and mission statement because it is translated by all employees in their daily work. A mission is supported by values through a code of conduct which guides day-to-day operations. HRD drives the campaign to ensure that all employees thoroughly understand these values. It starts with new employees who are explained the vision, mission, and values at the time of orientation, followed by keeping it foremost in the minds of employees through posters, internal documents, training programmes, and, perhaps, pin-up buttons. HRD is involved in strategic planning with the top management, as it has to align the human resources to strategic decisions. The strategic decisions are translated into action plans with specific objectives. The organisation structure is redefined to meet strategic intent. The above activities are best illustrated in the flow (Figure 3.1) given below: Vision

Mission

Culture

Strategies

Code of Conduct

Value Statements

Structure

FIGURE 3.1 | Organisation Activities Let us try to understand each of the terms mentioned above.

Plans/Objectives

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Vision A vision is an ideal and unique image of the future. The ideal is the state the organisation might attain. It has a sense of the possible. The uniqueness of the vision brings pride in being different. It is singular and unequalled. The image is a picture of the future which is an aspiration towards which the organisation is driven. The vision statement is one which is broad and all inclusive. It enunciates what the organisation wishes to become. It underlies the basic philosophy of the organisation. What does a vision do? It inspires everyone towards an ideal; it focusses people’s attention and energies in a singular direction; it controls work processes towards that direction; and it integrates diverse functions to a common purpose. As examples, given below are vision statements of few notable hotels:

Vision Statements The vision statement of Ritz Carlton Hotel is: “We are Ladies and Gentlemen serving Ladies and Gentlemen” The vision statement of Westin Hotels and Resorts is: “Providing a Preferred Hospitality Experience by Exceeding Expectations and Caring Without Compromise” The vision statement of The Hilton at Short Hills—Hotel and Spa is: “To be recognised as the ‘Best Customer Service Hotel’ in North America ... worthy of a special trip.... Financially strong as a result of the premium our services command”

Vision statements are created by visionary leaders. Visionary leaders help direct attention to new opportunities, they exemplify and model key behaviours for the future and motivate others to adopt new attitudes and behaviours. The HRD manager has to possess these qualities. Warren Bennis researched visionary leaders and came to discover that visionary behaviours are as follows. A visionary leader: l l l

l

l

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l l l

l

Searches for ideas, concepts, and ways of thinking until a clear vision crystallises. Articulates the vision in easy-to-grasp philosophy that integrates strategic direction and cultural values. Motivates employees to embrace the vision through constant persuasion and setting an example of hard work. Makes contact with employees at all levels in the organisation, attempting to understand their concerns and the impact the vision has on them. Acts in a warm, supportive, expressive way, always communicating that, “We are in this together as a family.” Translates the vision into a reason for existing. It continually relates the vision to each individual’s concerns and work. Concentrates on the major strengths within the organisation that will ensure the success of the vision. Remains at the centre of the action, positioned as prime shaper of the vision. Looks for ways to improve, augment, or further develop the vision by carefully observing changes inside and outside the organisation. Measures the ultimate success of the organisation in terms of its ability to fulfill the vision.

Vision, therefore, is enunciated by the organisation’s leader. He/She may take the help of the HRD manager to help articulate his/her vision. We must realise that a vision is the guiding philosophy of an

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organisation from which all actions flow. The HRD manager must think like the organisation’s leader and perhaps influence him/her to think differently if necessary.

Mission A mission is the overall purpose of being in business which ideally is in line with the values and expectations of the major stakeholders (i.e. people directly involved with an organisation). It answers the question, “What business are we in?” Every organisation has a reason for being in business. All its managers and staff are coordinated to fulfill that purpose. The purpose and direction is enunciated by the owners of the business in the form of a mission statement. A mission statement is a generalised statement of the overriding purpose of the business. It is the strategic intent of the desired future state or aspiration of the organisation. All stakeholders need to be clear about what they are seeking to achieve, and in broad terms, know how this is expected to be achieved. The mission statement defines the business and what it is there to do; distinguish it from other organisations by focussing on markets, customers, locations, and strategic features; and how the organisation intends to succeed. Take these as examples of mission statements of successful hotels to get a clearer picture:

Mission Statements The mission of the Ritz-Carlton Hotel: “The Ritz-Carlton Hotel is a place where the genuine care and comfort of our guests is our highest mission. We pledge to provide the finest personal service and facilities for our guests who will always enjoy a warm, relaxed yet refined ambience. The Ritz-Carlton experience enlivens the senses, instills well being, and fulfills even the unexpressed wishes and needs of our guests” The mission of ‘Conrad’—the international subsidiary of Hilton Hotels, USA is: “To constantly strive to improve, thus allowing us to prosper as a business for the benefit of our guests, employees, owners, and the shareholders of Hilton Hotels Corporation” The mission of Euro-Disney is: “Our mission is to be the highest quality service and hospitality organisation in the world by creating an environment where all Cast Members and Guests are happy” The mission of Radisson Hotels International is: “Our mission is to be the leading global hospitality services company. We will achieve this by combining innovative industry experience in marketing, technology and management with enthusiastic, responsive service, thus enabling the business within our system to better serve the stakeholders” The mission of Westin Hotels and Resorts: “Westin is the global hospitality organisation whose people are empowered and expected to consistently provide to its customers the best, most individualised services and solutions possible”

Code of Conduct Mission statements remain a fancy statement to most, unless there are some guiding principles that enunciate action. Employees want the mission statement translated into their day-to-day work. Mission statements are supported by simple work guidelines or a code of conduct. The Hilton Short Hills Hotel and Spa called these guidelines the “Fundamentals of Service Magic.” This is what they said:

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1. Immediate Acknowledgement—Eye contact, a warm sincere greeting, your smile. 2. Personal—The mood of the Customer governs your approach. One size does not fit all. 3. Invisible—Our actions speak the loudest. Never violate our commitment to a relaxed and refined atmosphere ... and the privacy of each Customer. 4. Anticipation—What would you expect from a world class professional? ... before our customer has to ask. 5. Response—Never say NO or make a direct reference to hotel policy. 6. Follow Through—A minimum of additional step to clearly demonstrate our commitment to Excellence. We respond within (10) minutes to any Customer and follow up with a telephone call within (20) minutes to ensure complete satisfaction. 7. Style—We make each task look effortless ... never “rush” the Customer or appear to rush in front of the Customer. Use proper vocabulary ... eliminating hi/ok. 8. Name Usage—It is your responsibility to know each Customer’s name. Don’t approach a table or knock on a guest room door if you don’t know that Customer’s name ... and remember it throughout his/her stay with us. Create MAGIC by involving your colleagues. 9. Efficient—Do it once, do it exactly right. 10. Knowledgeable—We make it our business to be informed ... and if we don’t know the answer, we find out NOW. 11. Trust—You get one shot at integrity. No grey paint. Ever. 12. Memorable—We are “on stage” with only a few seconds to leave a lasting impression. Exercise your own personal creativity; complete each encounter with a fond farewell. 13. Empowerment—If you receive a Customer complaint you “own” that complaint until it is resolved, COMPLETELY. 14. Grooming—We look the part ... every day. Spotless uniforms—impeccably tailored. 15. Five Diamond Service—We escort our Customers, rather than pointing out directions to another area of the hotel. 16. Telephone Etiquette—Answer within three rings and with a “smile”. Ask permission to put a caller on hold. DO not screen calls. Eliminate call transfers when possible. 17. Positive Energy—We are all ambassadors of this hotel, in and outside the workplace. Always talk positively. NO NEGATIVE COMMENTS.

Our Vocabulary Professional Service is an art form. We serve, yet we are not servants. We are “Ladies and gentlemen serving ladies and gentlemen.” Full Business Partners—Our success is dependent on the combined effort of each member of this team. We approach our decisions on the basis that this is our business ... and our money. If a colleague must ask you for help ... its too late. LOOK for ways to contribute. We see from the example above how the mission statement is translated into simple guidelines of action easily understood by all.

Culture Culture is an amorphous and mysterious element that cannot be seen or touched. We often hear of a person’s culture which defines his/her personality. It is a composite of values, beliefs, underlying assumptions, interests, experiences, upbringing and habits that create a person’s behaviour. An organisation’s culture is similar. It is the environment that exists at a workplace. It influences the work enjoyment, work relationships, and work

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processes. The culture of an organisation is the values, beliefs, underlying assumptions, attitudes, and behaviours shared by the employees of the organisation. It is the set of unspoken and unwritten rules of working together. It is the sum of all life experiences each employee brings to the organisation. It is put together through a process of selection and rejection of personal cultures into one that is acceptable to all. Very often, an organisation’s culture is influenced by the founding father of the organisation. It is further perpetuated by the senior management in the way they make decisions and deliver strategic direction. Culture is represented in the employees through: l l l l l

Language Decisions Symbols Stories and legends Daily work practices

Professors Ken Thompson (DePaul University) and Fred Luthans (University of Nebraska) brings out characteristics of culture: l

l

l

l

l

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People Shape Culture: No one person can create culture unless he/she is the founder with a determined personality to instill a culture. New entrants into an organisation may try to change a culture only to discover that he/she would have to conform to the existing culture or be ostracised. It becomes very difficult for a new person to introduce new ways of doing things unless he/she has the tacit support of the founder and senior management. The ability to change comes from trust in a person’s capabilities. This trust is developed over years of interaction. Culture + Behaviour: Culture is a composite of behaviours that are represented by the employees in the work environment. It is either good or bad. Good culture supports the progress and success of the organisation while bad culture impedes the success of the organisation. Good culture can manifest itself in various forms quite different from another organisation, as long it has made the organisation succeed. Culture is Learned: Employees learn the acceptable behaviours of the organisation very early in their career with the organisation. Some desired behaviours are even mentioned in the induction and socialisation processes. Conformity to accepted behaviours brings acceptance and rewards, while non-conformity brings negative responses. Culture is Learnt through Interaction: People learn culture by their interactions with other employees. It is they who informally initiate the behaviours and reinforce it till it becomes a way of life. HRD strives to get a “culture fit” in the first instance at the time of recruitment. It helps the new entrant to ease into the organisation quicker and with least emotional pain. Sub-cultures can Exist in a Culture: Employees have many different wants and needs. Sometimes an organisation culture can be quite stifling to some. Some employees with common needs may polarise into forming sub-cultures. These sub-cultures are localised to those groups and cannot be considered as the organisation’s culture. However they co-exist with the larger culture. Culture is Negotiated: Change in culture should be discussed and negotiated as the best way forward before it is introduced. Since people shape culture, it is they who will make it into a way of life in the organisation. Even a founder may get lip service to a change of culture initiated by him till the employees evolve a comfort with it.

The greatest challenge for modern organisations is to change their culture from old ways of working. For example, if an individual was evaluated always by his boss, imagine his discomfort and shock if he has now

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to be evaluated by his peers and subordinates also (the 360 degrees evaluation being adopted by many organisations). Cultures have evolved over time and employees develop a comfort in them. Most probably that comfort existed with the organisation’s founder and senior management. It suited their style of management. However, the need to survive in a competitive market requires change in working styles, and therefore, a change in comfort zones. Change in culture is facilitated by new vision, mission, and values.

Modern Cultural Elements It is valuable at this point to list the new elements of culture in today’s environment: l

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Transparency: This means that all employees are in the loop of what is happening in the organisation. Earlier, only the top management was privy to important information like strategies, financial performance, policies, etc. The new organisation keeps employees informed about each aspect regularly. Transparency is also in relationships. The boss and subordinate must be in sync with information and performance to bring out the best outcomes. Modern organisations have broken physical barriers to instill psychological change. For example, they have created open offices where closed office cabins were once in practice. The few management who have offices maintain an open door policy. Anybody can be approached at anytime. Trust: Dr Duane C. Tawy Jr. defines trust as “the state of readiness for unguarded interaction with someone or something.” It is a composite of three elements: (a) The capacity to trust which comes out of one’s total life experiences. If a person has been let down in past relationships, he is unlikely to trust a new person readily. (b) Perception of competence of one’s own abilities and that of others to perform competently in a current situation. Trust comes from how qualified a person is to suggest an action as well as how qualified one is to deliver it. (c) Perception of intentions where the actions, words, direction, mission, and decisions are driven by mutually benefitting motives rather than self-serving motives. In addition, trust is a feeling that one can rely on someone by experiencing teamwork, thoughtful risks, and believable communication. Immediacy: The modern person requires urgency in whatever they want. People are impatient when urgency is not shown in service, be it a home delivery or something they want to buy. Somehow, that urgency seems to dissipate when employees deal with the concerns of others. We must remember that others are on a fast track and are always pressed for time. Bureaucratic organisations are doomed to fail because they display a laidback approach riddled with red tape. Candour: This term means frankness. Employees are encouraged to be frank about what they feel is right, without fear. This quality acts as a check and balance to the way things are done as well as brings into focus some valuable opinions that may add quality to decisions. Earlier, managers had all the wisdom to make decisions when the workforce was less literate. That has changed. The young workforces of today have the modern knowledge and skills to make a significant difference in organisational performance. Good ideas are valued. They cannot be held back from expressing themselves due to an archaic culture. Modern organisations value candour as essential for quality decisions. Respect: The modern organisation has come a long way from the industrial age when people were mere extensions of the machine. The employees then were mistreated and abused at the workplace. This was because the workforces were illiterate. The modern workforces are “knowledge workers” with specialised skills and competencies. They command and demand respect because they have

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expert-based power. Modern organisations champion human dignity in all work arenas and will not tolerate any form of disrespect. Respect is exhibited in day-to-day interactions through courtesy, politeness, and kindness. People listen to others before expressing their point of view. It shows that a person has respect for the other’s opinion. Even differing points of view are dealt with through critique and not criticism. Critique focuses on the issues being discussed and not the person. Respect is also shown to people of different backgrounds—nationalities, religions, genders, economic backgrounds, etc. This matters more in today’s multicultural environments. Empowerment: Empowerment is the licence given to employees to impact on decisions and actions that affect their jobs. It is not a tool as most people think. It is a leadership philosophy which enables people to control their immediate work environments. Being in control rather than being controlled, is a powerful motivator. It brings ownership of jobs and actions, and commitment to goals. People like to feel that they are contributing meaningfully rather than being just “order takers”. Naturally, to be able to do this the workforce has to be built up in their knowledge, skills, and competencies to handle responsibility and make correct decisions. Weaknesses are looked upon as opportunities for development rather than areas of punitive action. Organisations create work teams, committees, impact circles, suggestion schemes, etc. to bring about participation of the employees. Leaders become facilitators and coaches to the empowered worker and not the “iron boss” of the past. Customer Orientation: “The customer is king or queen.” Every employee must put the customer before the self. It is for this reason that frontline staff is empowered to make instant decisions. The customers demands attention and immediacy from the dealing with them. They are always right. Service requires a genuine desire to serve and make people happy. The service orientation comes from humility. Continuous Learning: Knowledge improvement is imperative to survive in an ever changing environment. Continuous improvement has become a way of life. There is no place for outdated knowledge, skills, and attitudes. With this philosophy, organisations have to create a workforce that is ready for constant change. Intrapreneurship: This is a quality that requires every employee, especially those in revenue generating roles, to think like an entrepreneur or business person. Intrapreneurship is internal entrepreneurship. The load of success is no longer on the founding father and his/her top management, but distributed to all the employees to do their bit to make the organisation succeed. Intrapreneurship requires understanding finance, sales, marketing, cost-consciousness, creative ideas, systems discipline, and customer service. Innovation: Organisations have to come up with new ways of doing things. Customers are adventurous and are looking for new experiences to trigger their emotions. Hotels and restaurants can no longer adopt the “me too” policy, but have to come up with novel ways of doing their business. Continuous improvement is the step forward. It takes the involvement of every employee to think up new ways of doing things so as to bring efficiency, effectiveness, and guest excitement. The Crowne Plaza Today, Gurgaon, has a unique way to greet everyone. All employees greet with a namaste. This simple gesture sets the hotel apart from others.

While the above are some essential cultural elements, each organisation builds its own set of values that create culture. The issue of values is discussed next.

Values Values are fundamental beliefs and guiding principles that shape the culture of an organisation. A belief is a conviction that something is true. It promotes confidence and trust. Given below are the values of Westin Hotels and Resorts as an example of how values are written:

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We Believe in the Following Values (A) Commitment to People and Team l l

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Caring: We recognise the well being of guests, staff, and their families as the core to our success. Diversity: We value the diversity of personal interests, cultures, races, creeds, colours, and sexes and will always provide equality of opportunity. Fairness: We reward people based upon merit and expect everyone to accept personal responsibility for their actions. We are willing to forgive honest mistakes. Growth: Our commitment to manage growth creates opportunities for our people to develop. Investments in People: We will hire the best people who share our values. We are committed to helping people achieve their full potential through education, training, and skills development in a work environment which encourages feedback, advancements, reward, and recognition. Integrity: We generate mutual respect for each other through honour, truthfulness, maintaining the honour, and keeping our word. Empowerment: Our people will be empowered with the skills, tools, and authority to ensure that guest expectations are exceeded. Openness and Communication: We will listen intently to understand, clearly state our expectations, provide appropriate and timely feedback, and share information and ideas. It is okay to say ‘I don’t understand’ or ‘I don’t agree’. Openness of Mind: We will be receptive to new ideas and value the freedom of one’s mind and thoughts. Respect: We have mutual respect for each other’s talents and value dearly the contribution of all our associates. Teamwork: We believe in the strength and value of working together and cooperating for a common purpose.

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Creativity: We value originality and being in the forefront of new ideas. Excellence/Quality: We will constantly strive to achieve the highest level of quality given the existing environment. Flexibility: Flexibility in management style allows us to diversify beyond the confines of the hospitality industry and to adapt to changes. Fun at Work: We encourage the belief that work should be enjoyable and seek to provide a happy, fulfilling, and stimulating environment. Guest and Customer Driven: Consistently understand our customers needs and meeting, even exceeding, their expectations. Global Mindsets: Knowing no boundaries or borders, operating on a global scale, setting a world standard of quality and understanding that each hotel’s success affects Pan Pacific Hotels and Resorts worldwide. Pride: We take pride in becoming a leader and making a significant difference by providing the best hospitality while relentlessly pursuing perfection. Profit Oriented: We seek to ensure a healthy profit which enables growth and furthers the wellbeing of the staff, the company, the shareholders, and the owners.

(C) Commitment to Community l

Community Involvement: We value our relationships, our involvements, and our respected standing within the community. (Contd.)

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Environmental Sensitivity: We will work towards being environmentally responsible to all aspects of the business. Heritage: We value the local culture, traditions, and customs. Safe Environment: We serve to provide a safe environment for our guests and our employees.

Strategy From the mission flow the strategies. The term ‘strategy’ is derived from the Greek ‘strategos’ meaning a general set of manoeuvres carried out to overcome an enemy. What is notable here is the focus upon the word general. Therefore, strategies are not specific and leave the details to respective departments who will translate the strategies into operations. Strategy is, therefore, a general direction and scope of an organisation over the long term, which achieves advantage for the organisation through its configuration of resources within an environment changing (internal and external influences on an organisation) to the needs of the market and to fulfill stakeholders’ expectations. Strategies are required when there are changes in the environment such as new shareholders, expectations, competition, market behaviour, customer expectations, employee expectations, legislation, socioeconomic conditions, and technology. Strategic decisions are also made when there is uncertainty in the future. Looking at the definition, the scope of business may change when new products and services are introduced; e.g. the property wants to become a chain operation; the company wants to become multinational; or the company wants to diversify (moving into unrelated business). Naturally, the resources—i.e. men, money, materials, machines, metres (space), minutes (time), methods (systems and procedures), minds (knowledge and skills)—need to be configured to meet the new challenges. Strategy needs to have the concurrence of line managers and the HRD manager who will actualise those directions by assessing capabilities to meet those strategies. Managers have to cross functional and operational boundaries to deal with strategic problems and come to agreements with other managers who may have other priorities. They may have to perhaps change relationships and networks outside the organisation (e.g. suppliers, customers, etc.). Strategic decisions may also involve change in the organisation. Let us take an example of a strategic shift. A hotel which hitherto served all market segments as long as they could pay for its products and services now decides on a strategy to serve only the business segment (business entrepreneurs) and corporate segment (business professionals) on the belief that future money lies in these segments. Having made this strategic decision, the organisation resources have to be configured to meet that strategic objective. Following are the changes that would take place within the hotel: l l

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Renovate guest rooms to bring in more luxury Create facilities in guest rooms necessary for business travellers (broadband connections, extra desk, mini bar, safe box, etc.) Create express check-in counter Create a business lounge Create a business centre Have a butler service for personalised services Create restaurants with unique cuisines for business entertainment Have meeting rooms and conference halls Provide limousine service from the airport

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Create airport facilitation Create an airport restaurant/lounge Have a 24-hour in-house laundry Provide guest facilitations services (for air bookings, rent-a-car, florists, etc.) Have immediate medical attention services Create cocktail lounges

We see that a strategic decision to change to a business hotel has involved major financial commitment. This decision is not made in isolation. The HRD manager has to evaluate whether the human resources can be configured to meet the needs of the new strategy. We see new skills that have arisen such as butler service, business centre management, cooks to create new cuisines, drivers to operate limousine services, laundry personnel, concierge services, etc. More important is to change attitude towards a new customer profile which wants speed in service, efficiency, courtesy, etc. The HRD manager then creates HRD strategy spanning recruitment, training, reward and recognition, etc. Similarly, line managers have to change systems and procedures to give express check-in, airport facilitation, manage conferences, etc. Strategic decisions involve the following: l l l l l

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Impact on long-term decisions Achieve an advantage Change boundaries Match the activities of the organisation to the changing environment to achieve a strategic fit Build on or stretch the organisation’s resources and competencies to create opportunities and capitalise on them Change or align resources to meet strategic goals Change operational systems and procedures and nature of operational decisions Review the attitudes and values of the organisation.

Levels of Strategy There are three levels of strategy: Corporate Strategy This is concerned with the overall purpose and scope of the organisation to meet expectations of owners or major stakeholders and add value to the different parts of the business. Corporate strategy is heavily influenced by the expectations of shareholders. Strategic decisions are made by top management. All other strategies flow from the corporate strategy. Unit Strategy This comes into play when an organisation has more than one property (like in chain operations). Each unit then becomes a strategic business unit (SBU). The strategies of the unit flow from corporate strategies and now are tailor-made to the needs of the particular local market. Strategic decisions may look at how the customer needs can be met at the local level to achieve competitive advantage. Operational Strategy This is concerned with how the component parts of the organisation in terms of resources, processes, and people and their skills, effectively deliver the corporate and business level strategic direction. The success of corporate strategies lies at the operational level, and therefore, is very important. Therefore, each department (Front-Office, Food and Beverages, etc.) create their own strategies to dovetail within the corporate strategy. HRD strategies fit at this level. HRD Strategies HRD strategies span over the entire organisational life. They are meant to make a difference in the way things are done in an innovative and competitive manner. Given below is a list of HRD strategies modern organisations have employed to be effective.

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Strategies for Organisation Structure l l l l l

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Build flatter structures—remove organisation layers of managers and supervisors Let computers replace job positions and job levels that process information Create a Knowledge-based workforce—promote a learning organisation Promote research-based activity (Benchmarking)—decisions made on facts Have an informal hierarchy—boss-subordinate relationships should be trustful, transparent, and developmental Create Strategic Business Units—independent profit centres Work with lean staff Make each manager a business head—entrepreneurial thinking Empower frontline workers—giving more authority in decision-making Link to a bigger picture—all operational actions must be seen in the context of larger organisation interests Develop multi-skills in the workforce Up-skill jobs (Job Enrichment) Outsource expertise—here external specialists

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Projectisation—each objective must be treated with enthusiasm and commitment with a definite start and end. Accountability Performance Measurement Self-managing Project Teams—each team held accountable for results Competencies—desirable behaviours in each job position Cross-Cluster Sharing—inter-departmental coordination. Flexi-time—people work for job completion and not the number of hours put in Information Exchange—sharing of information at all levels Innovation/Continuous Improvement Continuous Learning Invest in Attitudes—hire people with positive attitudes for the job Diversity—create cross-cultural work-teams in terms of sex, age, domicile, etc. Recognition and Reward—compensate in cash and kind for good work done Career Planning Succession Planning Client focus Problem-Solving—people must be trained to solve problems and not creating them Transparency—openness Technology Efficiency—use technology for operational effectiveness Culture Driven—develop an HRD culture for individual and organisational growth Value Driven—promote values that take the organisation forward Culture Fit—hire people who will conform easily to prevalent positive culture Meetings-Based—promote meetings for participation indecision and sharing information Balanced Work Life—give time for people to fulfill their obligations to their families

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Leadership Strategies l l l l l l l l

Providing unified vision Creating pride at the workplace Building a bank of leaders Free Communication (Open door policy) Aligning individual performance to organisational performance Recruiting for “culture fit” Delegation Group decision-making

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Create an environment of self-actualisation (where employees are in control) Intrapreneurship (to think like a business person) Process feedback (by letting people know how they are doing) Celebrate achievements (recognition) Give performance rewards Invest in the quality of work (Orientation towards perfection) Give realistic goals Cheer each other

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Coaching Mentoring Balance-Scorecard—a process of unified attention to key success areas Project work Measurement skills Networking skills

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Job Evaluation Base Pay + Performance incentive Pay well

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Develop Job Descriptions and Job Specifications Conduct Behavioural Interviews—presenting situations to solve Have Multi-interviews Focus on culture fit Focus on attitude Bring in diversity

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Keep it simple Keep it transparent

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Create measurable outcomes Give periodic feedback on performance Performance should be Incentive-linked 180 degrees evaluation

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Reward for Performance Recognise for values

Most of these strategies will become clear in future chapters.

Policies and Procedures First, let us understand these two terms. Policies are guidelines for decisions. Procedures prescribe steps to accomplish a piece of work. Policies and procedures are meant to regulate the activities of employees. They are control mechanisms. They are created to take out the inconsistencies in decision-making brought about by uneven capabilities and idiosyncrasies of those making them. The basis for policies and procedures rests upon the cumulative experience of past managers. It believes that there is no need to make the mistakes of the past but there is a need to be guided by the experience. It helps in making decision-making quicker. A policy makes the decision-maker know what to consider, but does not prescribe the outcomes. However, there are downsides to policies and procedures. For one, it kills initiative. For bureaucratic organisations it becomes an end in itself. People are more preoccupied with following them rather than using them to guide themselves towards contributing to organisational objectives. One argument to resolve the issue is to not allow policies and procedures to remain unchanged for too long. They must be updated to suit modern times. Excessive and inappropriate policies and procedures ensnare the employees in red tape and hinder performance. Conventional wisdom suggests that performance of relatively routine tasks aided by mechanistic technology is facilitated best with comprehensive policies and procedures. For example, tasks like a room check-in or exchange of linen are best supported by policies and procedures. However, planning and research functions need a wide berth in which to operate effectively. The hospitality industry is largely guided by policies and procedures as most tasks are procedural in nature. International chains provide operational manuals which are series of procedures that safeguard an international standard of service. One must be cautious, however, that customer interface is not plastic to be just memorised and gives ample room for warmth and personalisation. Objectives and Goals From the strategies flow the specific objectives and goals to achieve the strategy. While a goal is qualitative and a general aim in line with the mission, objectives are more likely to be quantified or precise—in line with the goals. Objectives follow the SMART principle:

SMART Principle S—Specific: M—Measurable: A—Accountability: R—Reasonable: T—Time bound:

Clear in intention. (There is no ambiguity as to what has to be achieved) Preferably quantified in terms of units, percentages, time, and standards Naming the person who has to answer for the action Within the capabilities of the individual/team When the activities have to be achieved

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Objectives are reflected in formal business plans. Plans draw out the objectives—how they are to be achieved (action plan); when they are to be achieved (time limit); and who is accountable to achieve it (person responsible for the action). The corporate management or owner is concerned with perspective and long term plans (5–10 years), the Functional Heads (e.g. F&B Manager) are concerned with short term (3-year) and Annual Plans (1-year). Objectives are set against key result areas. A key result area is a focussed factor that ensures success. Examples of key result areas are: l l l l

Market Share Productivity Profitability Social Responsibility

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Innovation Physical/Financial Resources Human Resources Customer Service

The above are just examples. Each property will have unique key result areas. Typical objectives for food and beverage operations would be: l l l l

Increase food sales by 10 per cent over the previous year. Achieve an average cover rate of $20 by the end of the current financial year. The server shall reduce the time from ordering to first service by three minutes in the coming year. Reduce the number of guest complaints by 20 per cent from last year.

Structures An organisation then establishes a structure to serve its strategic objectives. The HRD manager is an important adviser on structures as he/she is best qualified in this subject. An organisation structure is a framework that establishes the relationships between job positions as well as the channel of communication. Such structures are explained graphically in an organisation chart. Most establishments follow traditional hierarchical organisation structures (Figure 3.2) that have evolved over time as the one shown below:

Top Management Middle Management Junior Management Supervisors Operations Staff

FIGURE 3.2 | Traditional Hierarchical Organisation Structure The human resources in an organisation may be classified into Managers, Supervisors, and Operations Staff.

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Managers are responsible for the effective utilisation of the traditional resources of men (human resources), materials (operating supplies), money (budgets and finances), machines (service equipment), etc. to achieve organisational goals. Managers are categorised as follows: Top Management is responsible for the long term and perspective plans (5–10 years), and funding and strategic objectives of the organisation. They would typically be the owner, Board of Directors of a Public Limited Company, Functional Directors, and the General Manager. Middle Management leads specific functions in an operation like the Food and Beverage Manager, FrontOffice Manager, Chef, Executive Housekeeper, etc. They make the short term and annual plans (1–3 years) for their respective departments. Junior Management leads the day-to-day operations relying on their management and technical skills. They ensure that the policies and practices translate themselves into work at the operational level. They would be the Restaurant Manager, Lobby Manager, Banquet Manager, etc. Supervisors are the link between the management and the operation staff at the floor level, and ensure that the resources allocated are effectively utilised. They are the face of management to the guest who recognises him/her as the team leader. They are the Restaurant Captain, Bell Captain, Floor Supervisor, Engineering Supervisor, etc. Operations Personnel are the frontline performers of operations who rely heavily on technical and customer service skills. They would typically be the servers, kitchen cooks, utility workers, etc. The proportion of skills required is illustrated below (in Figure 3.3): Conceptual/ Administrative Technical/ Customer Skills Management

Supervisory

Operation Staff

FIGURE 3.3 | Work Focus

Types of Structures Simple Structure This is one that can be considered as having no structure at all. These are found in small proprietary concerns which are under the control of an owner or his/her partners. The owner takes responsibilities of management, and even with partners, there is little division of management responsibility. This structure is suitable only to a point in the size of the organisation and the volume of business. As the organisation size increases, the owner finds it cumbersome to manage the responsibilities and hires additional help to share responsibilities. It is interesting to note that most web-based businesses of the future will operate with simple structures. In the hospitality business, this structure will be used by independent service providers (Software developers, assessment centres, job evaluation experts, trainers, etc. or extremely small hotels below 10 rooms or restaurants with minimal seating and food services. The structure (Figure 3.4) can be depicted as follows:

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Owner

Accountant

Salesperson

Operators

FIGURE 3.4 | Simple Structure

Functional Structure This is based on the primary activities that have to be carried out, such as food and beverage, rooms division, engineering, marketing, finance, human resources, etc. Most hotel units follow this type of structure. Within each function, the work is further divided into functional specialty areas. This structure is sustainable as long as the business is singular with homogeneous products and services. Hotel products and services are all centred on rooms and food and beverage. Once the products and services diversify, the structure will change. A typical functional structure (Figure 3.5) is as follows: General Manager

Rooms Divisions

Human Resources

Food and Beverages

Finance

Marketing

Kitchens

Restaurants

Stewarding

Banquets

Bars

FIGURE 3.5 | Functional Structure

Multidivisional Structures This is found in those organisations that have several strategic business units like a hotel chain. Normally, multidivisional structures are found in organisations that have several product lines, service lines, geographical distribution, or processes. A hotel chain may have several units producing the same type of service. Alternatively, the chain may split their activities into luxury hotels, mid-range hotels, economy hotels, and resorts. Each will have a specialised structure based on the specialty services provided by each service segment. For example, resort management is specialised and will have in its structure those functions that are peculiar to resort management. This is called divisionalisation. Divisionalisation is based on common products, markets, or services. Hence, the simplified structure would look like the following (Figure 3.6) though it can assume more complex structures (see “Hospitality Organisation Structures” explained later in this chapter) The advantages of such structures are: 1. 2. 3. 4.

The focus of expertise in that division Independent measurement of performance Ease with which the headquarters can close a division Capturs different market segments

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Headquarters Central Services

Division A

Division B

Division C

Division D

Functions

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FIGURE 3.6 | Multidivisional Structure The disadvantage is the inter-division rivalry—division heads want to be independent and make their own decisions; the headquarters has to carry the cost of the division initially till it shows returns; and that it is a costly approach.

Holding Company Structure This is an investment company, consisting of shareholdings in a variety of separate business operations, over which the corporate centre exercises simple control. Such structures are based on financial ownership of the parent company. In this structure, the business units operate independently and probably retain their original company names. The role of the parent company is making decisions whether to buy or sell off such companies with little influence on their product or marketing strategies. The structure (Figure 3.7) would look like this: Parent Company

Company A

Company B

Company C

Company D

Wholly Owned

Wholly Owned

75% Owned

25% Owned

FIGURE 3.7 | Holding Company Structure Wyndham Hotels world wide is a good example of this structure. It has several independent brands such as Days Inns Howard Johnsoe Ramada, etc. Many hotels and restaurants are choosing this option for several reasons: 1. 2. 3. 4. 5. 6. 7.

To have presence in a region To distribute overhead costs of the parent company over the various business units Spreading the financial risk of the holding company Ease of disinvestment if the unit is losing Availability of cheaper finance for individual units Expanding holding company wealth and Investment reasons—to sell the unit when its real estate value has appreciated in the market.

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The disadvantage of such a strategy is to exercise central control to ensure standards. Some chains prefer the original name of the property to use as a referral hotel in a region so as to capitalise on business originated in the wholly owned businesses.

Matrix Structure This is a combination of structures which often takes the form of product and geographical divisions or functional and divisional structures operating in tandem. This kind of structure is adopted when there are more factors influencing each business. Multinational chains may be forced to adopt matrix structures (Figure 3.8). The illustration below shows how a matrix structure is designed: North America

Europe

Asia and Middle-East

Far-East and Pacific

Luxury Hotels Mid-range Hotels Resorts and Spas

FIGURE 3.8 | Matrix Structure The advantages of matrix structures are that: 1. Each region is independent, linked to the parent company with some broad policies, areas of decisionmaking and standards. 2. There is flexibility of structures within each region based on the size and complexity of operations. 3. Expertise can be positioned closer to the region, e.g. Area Housekeepers, Area Controllers, etc. 4. Gives ample opportunities for career growth. 5. Gives opportunity to specialise in the culture and practices of the region. The disadvantages are that each region may build its own empires; this structure requires the willingness of management to go to certain regions upsetting their domestic scenarios; decision-making with parent company is slow, sometimes to the point of being bureaucratic; and this structure involved cost of international operations.

Modern Structures Modern organisations are bringing new innovations to structure, greatly spurred by telecommunications and information technology. Some of these innovations are briefly described here: l

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Moving to flatter structures by de-layering certain levels in the organisation. Those layers in organisations that processed information work have now been replaced by computer technology. Processing is done by computers churning information and analysis for decision-making instantly and accurately. Outsourcing is becoming common, specially when vendors are developing mastery in their fields and are able to sell their expertise in cost-saving contractual associations. Some examples from the hospitality industry are butcheries which provide pre-cut meat portions of meats to hotels eliminating in-house butcheries; maintenance of sophisticated systems like mainframe servers, firefighting alarm systems, telecommunications systems, HRD specialisms, etc. Back office processing: Many functions can be carried out elsewhere where real estate and labour is cheaper. Back office processing can be done in any geographic location This had been made possible by efficient telecommunications. For example, call centres in India process information and functions for companies based in America and Europe.

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Networking—to be close to customers. The global reservations systems are a good example of networking. Other innovations are ‘one-stop shops’ where physical presence is provided in a location. The agent processes customer requests by contacting suppliers elsewhere such as florists, pastry and delicatessen orders, outside catering, etc. Networking cross-sells others—products and services while serving one’s objectives. Creating ‘one-start’ facilities for those who need diagnosis. Chain operators may provide such advice to a potential collaborator to help him/her get the right information to start a hotel. Consultancy services: Many organisations are streamlining their functions to become profit centres. For example, the HRD department sells its expertise to non-competitive organisations. The Health Club spans out into a profit centre driving membership campaigns with superior services to be economically independent. Large multiplexes that have shopping centres, entertainment centres, food courts, commercial apartments, etc. in addition to the hotel complex, can use the services of housekeeping, engineering, horticulture, etc. for a fee.

Job Titles Job titles are the public names given to a job position. They are important in organisation structures. They differentiate and identify one job from the other. They differ from job designations which is the root name given to a job to establish internal parity. For example, a front office designation may be “front office assistant”. The organisation, however, may give that position a title of Front Office Agent. This strategy is adopted for several reasons: 1. A designation gives a consistency in relation to other positions of a similar nature in the organisation. Similar designated positions are clubbed and fitted in the same grade of the organisation. So, a housekeeping assistant will attract the same salary as the front office assistant. 2. A title is given to make the employee feel important and respectable. For those in India who are emerging from a taboo towards service for generations, to be titled with respectable names for their own self-esteem in society is much preferred. Many modern youth may loathe the designation of a waiter in the eyes of a class conscious society in India. He redeems himself by being titled a steward, restaurant sales person, or a restaurant agent. 3. Titles are for the public. It helps people know exactly what service the job position will deliver. So, a front office receptionist is the only person in the guest’s mind who will check him into a hotel and not a Bell-Captain.

2. IMPORTANCE OF HUMAN RESOURCES PLANNING The first step for a human resource professional is to plan. The plan is a blueprint of future action. It has objectives, strategies to achieve them, time frames of action, and accountability. The success of any hospitality operation depends on the way it is organised to achieve its goals. The HRD professional is called upon to recommend to the owners of the business, appropriate human resource directions for the success of the business. Such suggestions are in areas of organisation design, structure, human resource needs, recruitment, employee performance, motivation, and developing knowledge capital (see subsequent chapters for details of each). The responsibility for HRD planning is a joint collaboration among the HRD manager, top management, and the line managers. Each has to be committed to the plans they jointly evolve. HRD planning is a holistic approach rather than one created in the haloed office of the HRD manager only.

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In general, human resource planning is the process of moving human resources from current to future scenarios. Through planning, HRD achieves the right number (quantitative) and kinds (qualitative) of employees, at the right places, at the right time performing in such a manner that both the individual and organisation are satisfied. In other words, it is the HRD manager’s aspiration to use human talent effectively for individual and organisation benefit. HRD planning involves eight elements: 1. 2. 3. 4. 5. 6. 7. 8.

HRD policy formulation HRD goals and objectives Managing the internal and external environment Strategy formulation and measures to meet goals Developing, implementing, and monitoring critical processes for development Integration of critical HRD processes Creating an HRD information base for better decision-making Recognising the human aspect of the organisation by organisation behaviour best practices

The importance of human resources arise from the sweeping changes taking place in the way business is done, largely influenced by the information revolution. The new changes in the way HRD operates are: l l

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Human resources are an investment and not a cost. Their skills can be converted to currency. HRD interventions are proactive rather than reactive. It anticipates events and prepares for them rather than responding to events after they have happened. HRD is a facilitator of change rather than a controller of people. HRD strategies are an integral part of business strategies. HRD processes (like performance management, career planning, training and development, etc.) must be integrated as a force to manage performance and change. It focusses on individual and organisational growth.

The importance of HRD grows with the modern times. Some important developments that have taken place are: l

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The emergence of a knowledgeable and talented youth entering the workforce. This youth wants freedom to express itself and be part of the decision-making processes. They resist the ‘command and control’ attitude of earlier organisations. HRD has to make full use of their talents and create a culture of transparency and involvement. The obsolescence of older employees. They need to be helped in seeking another career. The march of technology in creating valuable information. Technology is de-layering structures doing the work of those who processed information. The internationalisation of business. Many organisations are thinking of foreign expansion. HRD has to manage multi cultural workforces. The changes in legislation that demand affirmative action. These include initiatives like providing employment to the underprivileged, occupational safety and health, equal employment opportunities, etc. Human resources are now viewed as an asset. Chief Executives now perceive the human resources as an asset like any another asset of the organisation. The mobility of employees in a seamless employment market. This means that the employees have greater opportunities to self-actualise their potential and may move to different careers. They have no loyalty to an organisation, but are loyal to their profession. There is a heavy attrition rate of good performers. The challenge is one of retention. HRD has to find innovative ways to retain talent. Finally, there is the aspect of constant change.

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Phases of HRD Planning Typically, HRD planning has four phases: 1. Gathering and analysing information through human resource inventories and forecasting needs. 2. Establishing human resource objectives and policies that support the attainment of the objectives. These must be jointly approved by top management and line managers to seek commitment. 3. Designing plans and action programmes such as recruitment, training, compensation, career plans, etc. 4. Periodically monitoring, controlling, and evaluating human resource plans to ensure progress towards the stated objectives. Let’s look at each phase in detail:

Gathering Information Human resource inventories and forecasts are influenced by corporate objectives, policies, and plans. HRD planning takes into account current and future needs of the organisation. The process is to retrieve information of the past, view it in the present, and forecast it for the future. The kinds of past information got for future planning is employee attrition rate, inventory of skills, performance indicators, deficiencies in realising peak performance, competitive strategies and practices, changes in external environment (legislation, social, competitive, labour market, etc.), performance of existing HRD practices, union interventions, employee costs, and employee morale. There are several methods in forecasting needs. These are:

Expert Forecasts Here, the Delphi technique is used where important members (experts) of the management team are made to make human resource forecasts individually in terms of numbers, new skills and any other factor that influences performance. Members take into account the information gathered by the above process and the future directions. These listings are shared and the members revise their original listing. A facilitator helps in arriving at a composite forecast. The Delphi technique is said to have been successful in determining one-year forecasts. The difficulty with this technique is the integration process of experts who may be stubborn on their point of view. Statistical Projections The most common statistical projection is the simple linear progression analysis where past indicators are used as future indicators. This method works on the belief that the organisational and external environment remains constant. This method would fail in today’s changing environment. For example, the payroll costs in a hotel are interpreted as a ratio to sales turnover. A 12–14 per cent payroll percentage in considered healthy. Logically, the linear progression indicates that the payroll budget would change in the same ratio as the projected sales. It does not happen that way. The alternative is to use the multilinear regression analysis where multiple indicators are used to forecast demand. They would use other indicators in addition to sales such as labour market conditions, productivity, use of technology, etc. Computer Simulations These are used increasingly to factor in several variables in a business strategy. For example, it would take into account a new hotel added to the chain, new services being added to the existing hotel, attrition levels, new skills requirements, overtime costs vs. new hires, etc. Replacement Charts This is a method of identifying the needs of numbers and skills in case of employee turnover. It actually plots existing positions (especially critical ones). The method lists the present occupants

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of those positions and plans who will replace them in case of the employee’s exit. In other words, it leads to succession plans. Some positions may be filled by ready alternatives within the organisation while others may show a dead end. There are two ways to fill the gap—to give another employee who shows potential an accelerated development input to be ready in the shortest time, or to hire someone from the outside. The internal source is preferred.

Plans and Actions The HRD manager puts together action plans to meet the objectives, strategies, and needs. These plans reflect in individual components of HRD activity such as recruitment, compensation, performance management, training and development, and career plans. The challenge is to integrate these individual action plans into a whole, so as to give the desired thrust. We have talked of the organisation’s needs till now. Each component of HRD activity must take into account individual aspirations as well. Individual aspirations are identified from the performance management system that throws up such aspirations. These aspirations need to be monitored and supported by career plans and training and development initiatives. Action plans must take into account the external influences anticipated on business such as technology training, obsolescence, competitive actions, etc. (This is discussed in detail later in this chapter under the heading, “HR Policies and Objectives”).

Programme Control and Evaluation Control and evaluation of human resource plans and programmes are essential to the effective management of human resources. Modern Human Resource Information Systems (HRIS) are able to churn out relevant information to monitor progress. Evaluation should be periodic (every quarter) to make such changes in programmes to meet changing developments in the business. There is a challenge to measure the impact of HRD initiatives. There are a few evaluation criteria which are mentioned below:

Attrition Rate The number of employees leaving the organisation reflects the culture of the organisation and whether it is a preferred place to work in. An organisation that is able to retain its employees shows that its HRD practices and policies are creating a quality of work life that is superior to others. Another indicator in this category is the length of time a new hire spends in an organisation. Organisations like to have good performers have longer stints.

Knowledge and Skill Inventory An organisation can see the additions to its skill inventory as an indicator of individual growth and development. For example, a hotel can have a percentage increase in people who are computer literate. The freedom to experiment in cuisines throws up new skills to provide unique cuisines that give a competitive edge.

Productivity Standards There are two aspects to productivity: 1. How many people meet productivity standards? 2. How productivity standards can be improved through better training, work design, employee motivation, and technology?

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The first brings employee performance at par with the desired existing standards while the second exceeds performance with better standards.

Behavioural Concerns The HRD manager can see the morale and motivation of employees through employee surveys. He/She can produce statistical data from these surveys to evaluate its success in the human aspects of managing human resources.

3. HR POLICIES AND OBJECTIVES The HR policies, plans, and objectives have to be directly related to organisational policies, plans, and objectives. Actually, one influences the other because business plans include HRD objectives and policies. Let us look at each in detail.

HR Policies These are broad guidelines for all employees on how the human resource function runs. The policies define the culture of the organisation and how it values the human resource. The main purpose of policy is to bring about a consistency in the manner in which human resources are managed. Policies are reflected in the form of an HR Policy manual. Modern organisations now post the policies in the intranet (the internal computer network) making policies transparent for all to see. Earlier, these policies were carefully guarded and the HRD manager interpreted them the way he/she chose to. A policy manual will typically detail the following issues:

1. Vision, Mission, People Philosophy, Credo, Core Values l l l

Vision People Philosophy Core Values

l l

Mission Credo

2. Manpower Planning l l l

Organisation Structure Manpower Budget Job Specifications

l l l

Manpower Plans Job Descriptions Career Plans

3. Recruitment and Selection l l l l l

l l

Employment Policy Re-Employment of Former Employees Age Eligibility Recruitment Activity Residence Permits and Visas (for expatriates) Interviews and Tests Appointments

l l l l l l l l

Talent Bank Hiring of Relatives Recruitment Categories Eligibility Requirement for Employment Reference Checks Pre-Employment Medical Examinations Employment Conditions Joining Formalities

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4. Compensation l l l l l l l l l l

Job Evaluation Basic Salary Scale Payment of Salaries Allowances Public Holidays Compensation during Training Compassionate Leave Unpaid Leave Entertainment Expenses Medical Services

l l l l l l l l l l

Compensation Surveys Salary Increases Salary and Allowance Deductions Working hours Annual Leave and Leave Travel Allowance Leave of Absence Maternity Leave Loans Other Benefits Business Travel

5. Performance Management and Rewards Performance Management l l

l

Objectives Performance Appraisal for Permanent Employees Probation Period and Trainee Performance Evaluation

l l l l l

Performance Philosophy Promotions and Rewards Post Review Action Review of Management Potential Maintenance of Records

Rewards l l l

Objective Policy Trainee Evaluation Form

l l

Scope Performance Appraisal Form

6. Training and Development l l l l l l

Identification of Learning Needs On-the-Job Coaching Training Programmes in-house Training Cost Effectiveness Reporting and Budgeting Individual Development Plans

l l l l l l

Line Management’s Responsibility for Training Learning Professionalism External Training programmes Evaluation of Learning Results Training Abroad Mentoring

7. Employee Relations l l

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Employee Communication Employee Fraud, Theft or other Illegal Activities Performance Related Discipline Employee Welfare

l l l l

Safety Grievance Policy and Procedure Disciplinary Policy and Procedure Code of Conduct

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8. Exit l l l l l l l l l l

Types of Termination of Service Resignation Redundancy Discharges for Disciplinary Reasons Absence without Notice Attainment of Retirement Age Notice of Termination of Service Gratuity Non-Assignable Charges against Termination Benefits Documentation

l l

l l l l l l l

Termination during Probationary Period Termination for Poor Performance or Disciplinary Reasons Termination on Completion of Specified Term Contract Termination of Service for Medical Reasons Death Right of Appeal Payment of Termination Benefits Certificate of Service Approval Authority for Termination of Service

HRD Objectives The HRD objectives respond to the organisations strategies and key result areas for success. A common set of organisation key result areas are (a) profitability, (b) growth, (c) survival, (d) Image, (e) technology, (f) social responsibility, (g) knowledge wealth, and (h) innovation. Let us look at how HRD objectives respond to these key result areas:

HRD for Profitability Productivity Capital Productivity l

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Equipment Availability, Reliability, and Capability: Use equipment as labour saving devises that can improve productivity. A vacuum cleaner for a room attendant greatly enhances her productivity in cleaning a guest room. HRD must research with department heads in similar labour saving devises. Once the equipment is procured, the staff will need training in its correct use so as to increase its life. HRD will also instill the practice of preventive maintenance to safeguard against equipment breakdowns. Operational Skills: Improving the competencies and capabilities of employees towards high performance is a fundamental job of HRD. This is done through continuous training. HRD will also develop line managers in coaching skills to improve performance on the job. Multi-skills: HRD would like to make the organisation more flexible in the deployment of its human resources. This can be achieved in training employees in multiple skills. For example, a cook should be able to handle an array of equipment like hot-ranges, convection ovens, microwaves, salamanders, etc. We see that one person is proficient in the correct use of many capital items. Enlightened Union: HRD has a great role in educating and eliciting the cooperation of the union in responding to changing times. For example, the union has to realise the value of technology to improve performance and increasing employee skills. Utilising Knowledge Wealth: Knowledge is now considered as much of an asset as any capital item in an organisation. (see “Knowledge Management” in Chapter 10 for details).

Material Productivity l

Waste Reduction: This can be achieved with proper training. If skills are honed to a point of perfection, then waste is reduced. People also need to develop self-discipline in following systems and procedures.

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They must also think in terms of recycling items like bottles, newspapers, cans, and leftover food. Storekeepers must know the qualities of items to prevent loss due to spoilage. This is especially true of perishable items. Reduction in Consumption of Materials: This can be achieved through proper training. For example, cooks must learn to follow standard recipes to optimise the use of materials. The purchase department also uses standard product specifications to get the right materials for consumption. Stores Control: Storekeepers must learn to follow correct procedures in store requisitions. They must keep exact inventories to control the hotel’s expensive assets. Stores must prevent pilferage. Quicker Processing of Material: This is especially true in stores management where the precious assets of the organisation are stored. In the first place, they must not keep huge inventories locking up capital but carefully replace items ‘just-in-time’ for consumption.

Managerial Productivity l

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Training to Improve Capital, Material, and Employee Utilisation: Managers need to be trained in the productive use of their resources as mentioned above. Resources are precious and in short supply. They must be the champions through role modeling and coaching to improve employee attitudes to capital resources. After all, managers are the custodians of the assets in their charge. Training in Planning, Information, and Control Systems: While these may sound basic to managerial principles, line managers do get caught up with operations and resort to hurried and informal approaches. They must be more disciplined in the way they manage, using best practices as tools for success. Training in Finance and Budgeting: Managers must think like entrepreneurs and look at money as their own. They should be efficient in their use of finance bringing in greater cost efficiency. Time Management: Time is a valuable resource today. Productivity is related to time. All resources must be productive. Managers must be trained to make best use of time to achieve productivity. Mentoring and Coaching: These are essential skills of modern managers to improve performance in operations. Mentoring offers a paternalistic attention to employees to bridge personal and professional hurdles in performance. Coaching is the micro-training of employees where there are performance gaps. Human Resource Development: Each manager is responsible to develop the employees under his charge to hold higher responsibilities. This serves many purposes—it improves the knowledge capital of the organisation; it improves performance; it meets individual aspirations to gain commitment; and it improves capabilities within the department. Delegation is a valuable method of development. Delegation is the allocation of higher responsibilities to a subordinate while holding the accountability. Managers need to be taught delegation skills.

HRD for Growth Individual l

Enabling Employees to Grow with the Organisation: This requires understanding individual career aspirations and guiding the individual towards them while serving the organisation’s purposes. Growth is not only advancement, but also any new experience that will promote knowledge and capabilities. There must be congruence in individual and organisational aspirations and expectations. Neither can be sacrificed for the other. Such congruence is brought through career and succession plans.

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Inclusion in Strategic Planning: Modern employees do not like to be left out of strategic decisions. They are taken into account because they are the ones who will actualise those directions. They need to be involved in such decisions so as to iron out any hurdles that may exist in their motivations or capabilities. In service organisations, the employees shape the organisational success and not the other way round. HRD will have to find ways to involve employees, e.g. suggestion schemes, committees, etc. Self-development: HRD has a major role to play in this aspect. HRD is supposed to create a learning organisation (see “Creating a Learning Organisation” in Chapter 10 for details) where continuous learning is a way of life. Employees must be made to take the responsibility to master their chosen field. HRD can provide the facilities and tools to do so.

Organisation l

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Career Planning: This is a process that amalgamates individual and organisational career aspirations and expectations. (see “Career Development” in Chapter 7 for details). Succession Planning: Succession planning is a process of meeting the organisation’s immediate and long-term needs to fill higher positions. (see “Succession Planning” in Chapter 7 for details). Planning as a Skill: An organisation is built on sound planning processes. Managers need to be trained in planning principles to be accurate in their actions for the future. Planning requires commitment of resources and they can be only deployed effectively with good planning. Evaluation of Potential: Potential, as we have learnt earlier, is the capacity to be developed further. There are employees with lesser or greater potential. These need to be understood continuously to develop to meet organisational needs. The organisation’s future rests on the potential of today’s employees. Increasing Knowledge Wealth: This is vital in a knowledge economy where knowledge is an asset that can be converted into currency. (see “Knowledge Management” in Chapter 10 for details).

HRD for Survival Quality l

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Quality Campaigns: HRD leads the quality movement in an organisation. Most progressive organisations are aspiring to attain ISO certification. HRD must work closely with the quality specialists to achieve the certification. ISO looks at processes and documentation in every aspect of the organisation’s functioning. Quality Circles: It is not only important to gain quality certification, it has to be foremost in the minds of the employees who provide the service. HRD organises quality circles throughout the organisation. Quality circles are inter-functional groups of people at all levels who meet periodically to discuss issues of quality at the workplace. Training in Quality Orientation: Quality movements throw up gaps in performance that hinder the realisation of quality. HRD will have to organise training programmes specific to quality attainment. Upgrading Technical/Job Skills: Upgradation is vital, especially when technology is moving with such speed. The organisation would like to stay current in their knowledge and skills to be competitive. HRD organises such upgradation programmes.

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Cost-Effectiveness l

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Cost Consciousness Campaigns: HRD would like to attain a cost conscious leadership within the organisation. This they can achieve by exhibiting cost-consciousness in whatever they do. It is not achived by cutting corners but by optimising resources. HRD examines how materials can be recycled, people can be multi-skilled to eliminate hiring additional-people, and how standards can save time and promote productivity. Finance-oriented to Cost-benefit than Cost cutting: HRD works closely with the Finance Department to do cost-benefit analysis, especially in areas that involve people. Such measures can include bringing in technology to cut major human resource costs on a long term or looking at compensations as value for money. Cost Centre Teamwork: HRD could promote cost circles in the same lines as quality circles. Perhaps quality circles can look at costs too. HRD must introduce reward and recognition schemes that encourage major cost savings. Training in Cost Awareness, Control, and Reduction: People need help in understanding costs and how to reduce them. Training brings about cost consciousness, enquiry into materials, and processes and practices to reduce costs.

Work Ethos HRD works towards improving the work culture of the organisation. The areas that it concentrates on are: l

l l l

Behavioural competencies of Line Managers Effective communication networks Time-management Customer focus

l l l l

Quicker decision-making Delegation Systems discipline Creativity and innovation

Most of them are imparted through training.

HRD for Social Responsibility Hotel, like any other business, serves the society that it is a part of. Hotels naturally want to conduct business responsibly. Here are some ways they can do so: l

l l

Supporting human rights and employee dignity Training people in technology Ensuring Employee health and safety

l l l

Providing equal opportunity Improving quality of Work Life Ensuring high employee morale

HRD and Organisation Image The image of a hotel is very precious. The reputation of the hotel in society drives its business. Image is very fragile and sometimes ruined by one bad incident. Hotels promote their image in the following ways: l l l l

Being the preferred organisation for employment Introducing HRD best practices Involvement in community concerns Being the benchmark for the best HRD practices

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HRD for Technology Technology has swept all aspects of doing business today. Hotels cannot avoid its influence. However, hotels do not employ technology as a fashion, but use it for improving business performance. Here are some gainful ways of using technology: l l l l l l

Using technology to improve performance Using technology for better customer service Using technology to manage HRD costs Using technology to improve productivity Having the right people with the right skills at the right place Planning for new skills using the following approach: Retraining and redeploying old employees and empowering them with new skills Converting unskilled employees into skilled ones Updating old skills with recent developments Providing hands-on training Reconfiguring employee relations to deal with the knowledge worker l l l l l

HRD for Creating Knowledge Wealth Knowledge in modern times is wealth. Hotels can generate revenue with specialised knowledge its people possess. Specialised knowledge is the cutting edge for the future. This knowledge can be harnessed in the following ways: l l l

Creating a learning organisation Inventorising knowledge and skills Utilising knowledge to get competitive advantage

HRD for Innovation Hotels and restaurants today, and in the future, have to innovate or die. Obsolescence is the greatest fear nowadays. The fast progress of technological development makes knowledge outdated very quickly. Hotels have to constantly innovate to survive as also create a cutting edge. They do this by following means: l l

Create and monitor suggestion schemes Create a culture and reward system for continuous improvement

4. HOSPITALITY ORGANISATION STRUCTURES Corporate Structures Chain operations have become a powerful influence in the way hospitality business is done nowadays. They come with global standards, financial strength, global distribution systems, and most of all, strong brand names. Any hospitality entrepreneur who wishes to survive in strong competitive markets adopts franchised brand names, with several options to do business. So, we have strong brand names like the Sheraton, Intercontinental, Hyatt, Ramada, etc. offering hotel franchises, while the restaurant sector has equally strong brand names as Burger King, TGIF, Planet Hollywood, Chillis, etc.

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Chain operations have elaborate structures as shown in Figure 3.9. The structure has the following members: l

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A Board of Directors who represents the shareholders. Their responsibility is to give strategic financial and policy decisions that act as guidelines for action on a long-term basis. A Chief Executive Officer (CEO) who is the intermediary between the Board of Directors and the Operational structure below. Since the Board are not full time members and meet occasionally, he/she protects the Board’s interests and also conveys operational matters that need Board approval to the Board. The President is the head of all operations of the chain and reports to the CEO. He appoints Regional Vice-Presidents. Regional Vice-Presidents cover geographic regions of the chain operation. International chains would have Regional Vice-Presidents for North America, South America, Europe, Middle East, South Asia, Far East, and the Pacific. Regions may be clubbed based on the number of units in the region. Each Regional Vice-President would have Area Directors/Managers. Area Directors/Managers oversee operations within a group of countries or states within a larger continent. Country Managers are appointed if a country has multiple units to warrant one. General Managers/Managers are heads of independent units.

Figure 3.9 shows how a chain corporate structure is designed. Board of Directors

Chief Executive Officer

President

Regional Vice-Presidents

Corporate Specialists

Area Managers

Country Managers

Heads of Properties

FIGURE 3.9 | Corporate Structure of a Chain Operation

Other Structures of Corporate Chains There are other ways of looking at structures of corporate chain operations as illustrated below:

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Superstructure—Grouping by Divisions Divisions Grouping by Functions would mean that each department would operate as an independent function such as Marketing, Operations, Human Resources, etc. This has been the usual structure of present day operations of a corporate chain . Figure 3.10 presents the structure by function while Table 3.1 gives an analysis of this method. Company

Finance and Accounting

Operations

Marketing

Human Resources

Finance

Accommodations

Recruitment

Accounting

Food and Beverage

Training

FIGURE 3.10 | Grouping by Function

Grouping by Product is done when a corporate business has more than one product. A chain may be in the business of premium hotels, mid-size hotels, and budget hotels. Each product could have its own structure and chain of command. Grouping can also be done by business hotels, resorts, and group hotels. Figure 3.11 gives the structure by product while Table 3.2 gives the analysis of this method. Company

Product A (Luxury Brand)

Product B (Mid-Range Brand

Product C (Budget Brand)

FIGURE 3.11 | Grouping by Product

Grouping by Process involves segregating the whole operation by the process. For example,. business setup, operations, business promotion. The grouping above is presented below in Table 3.3 while its analysis is in Table 3.4:

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TABLE 3.1 Analysis of Grouping by Function

n n n n

Advantages Each function can concentrate on their specialty People like to work with their own Kind Work is not duplicated Has a systematic approach

n n n n

Disadvantages Communications between functions are slow Departments become own kingdoms Departments blame each other Become isolated, stopping free exchange of ideas

TABLE 3.2 Analysis of Grouping by Product

n n n

Advantages Management and staff can become specialists of that product Divisions can compete healthily with each other Accountable for own performance

n n

Disadvantages Divisions can act against each other Duplication of staff resources

TABLE 3.3 Grouping by Process

n n n n n

Business Set-up Funds Managers Architects and Builders Facility Planners Engineers Food Technologists

n n n n n n n n

Operations Vice-President Operations Menu Planners Quality Assurance Recruiters Trainers Maintenance Engineers Corporate Chef Information Technologists

n n n n

Business Promotion Media Planners Merchandising Food Promotion Planners Market Researchers

TABLE 3.4 Analysis of Grouping by Process

n n n

Advantages Enables specialisation Can isolate a problem area of a total product Can control the introduction of new technology

n

n

n

Disadvantages One process can slow down the whole product completion Specialists of one area may have difficulty relating to another area Strikes in one area can hold up the whole production

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Flat Structures The modern mantra in organisation structures is to keep structures lean and flat. They have made this possible by removing several layers like middle management and junior management who did the processing work of information. Computers today have taken on this role and are generating valuable reports for decision-making, instantly and accurately. Junior management has become hands-on team leaders who inspire their teams towards perfect service. A typical flat structure is given in Figure 3.12:

Frontline Operators

Specialists

Top Management

FIGURE 3.12 | Flat Organisation Structure The flat structure may seem very disconcerting to the traditionalist. However, all organisations are moving in this direction. An inverted pyramid implies that the frontline staff (receptionists, waiters, room attendants, etc.) headed by team leaders is king and supported by the specialists and top management. The main objective of flat structures is to be less bureaucratic and push decision-making at the customer contact end. It recognises that it is the frontline people like front office agents, restaurant servers, and counters sales persons in a delicatessen or bake shop, who make the revenues and control costs. They also create the ultimate guest experience, and therefore, need to be put in their right perspective. For example, frontline staff can now make decisions such as upgrading a room for a regular guest or offering a superior room to a confirmed guest when the class of rooms reserved is not available, if they believe that action will improve sales and create repeat customers. Naturally, the frontline staff will have to be more qualified and trained to hold such responsibilities. They become knowledge workers who serve the customer with superior knowledge of products and services. The specialist’s sole purpose is to enhance the performance of frontline staff by providing specialist support and advisory services. They receive first hand feedback from the frontline staff and convert it into better performance. Specialists are IT professionals, trainers, quality inspectors, corporate housekeepers, corporate chef, corporate human resource director, etc. The top management will not interfere in operations and will concentrate on strategic directions. Typical roles will include strategic planning, raising finance, mergers and acquisitions, influencing government regulation, monitoring financial and human performance, and setting such policies that fulfill the objectives of flat structures.

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Hotel Structures Large Independent Hotel Structure Traditional large hotel operations require more people to operate it compared to smaller ones. The amount of specialisations also increases, and therefore, requires an elaborate structure. The structure given in Figure 3.13 is a representative one and can be modified according to the policies of the enterprise. Small Hotel Structure Smaller hotels would have many of the functions above done by fewer people requiring multiple skills. The organisation structure (Figure 3.14) shows how a structure is pruned to fit limited payroll budgets. In small hotels, the roles are multi-skilled in the following manner: l

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The General Manager takes on the roles of human resources manager and sales manager in addition to the operations responsibilities. He may be assisted by representatives. The Front Office Supervisor oversees the front desk operations as well as lobby activities. The Dining Room Supervisor oversees the kitchen and dining room operations. It is significant that small operations would have limited restaurant options, possibly only a dining room that serves all meal times. It is possible that the dining room has a dispensing bar to provide drinks eliminating the need for a formal bar. The receptionist does the reservation, reception, information, and telephone and cashier functions. The Accountant takes over the income and payable responsibilities in addition to producing the statutory requirements such as Profit and Loss statements and Balance Sheets. He/She is assisted by the Purchase Clerk who doubles for the receiving and store function. Though this is strictly not ideal in terms of food and beverage control, the operation is small enough for direct supervision and control of the General Manager or Accountant. The Food and Beverage Cost Clerk will do all the costing functions. The engineering supervisor is multi-skilled to troubleshoot engineering problems. However, any operation requires specialists like air-conditioning and heating mechanics and plumbers. Most other services would be outsourced, such as laundry, horticulture, civil works, etc.

A hotel has two major revenue producing departments: 1. Accommodations which is responsible for the sale of rooms and the support departments such as housekeeping, laundry, telecommunications, etc. required to make them saleable. 2. Food and Beverage which is responsible for the sale of food and beverage, and the service departments such as kitchens, stewarding, restaurants, room service and banquets responsible for their sale. In addition, there are minor operating departments like the Bake-Shop, Health Club, Recreation, Delicatessen, Flower Shop, Business Centre, etc. There are staff departments that support revenue activity like Finance, Human Resources, Sales and Marketing, and Information Technology.

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General Manager Chief Security Officer Accommodations Manager

Food and Beverage Manager

Executive Chef

Financial Controller

Sales and Marketing Manager

Human Resources Manager

IT Manager Chief Engineer

Executive Housekeeper

Front-Office Manager

Chief Steward

Banquet Manager

Sales Executives

Executive Sous Chef

Lobby Manager

Restaurant Managers

Income Accountant

Recruitment Manager

Assistant Housekeeper

Manager Telecommunications

Room Service Managers

Purchase Managers

Training Managers

Guest Relations Executive

Bars Managers

Receiving Managers

Compensation and Benefits Manager

Food and Beverage Controller

FIGURE 3.13 | Management Organisation Structure of a Large Hotel

Human Resource Management

Laundry Manager

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General Manager

Dining Room Supervisor

Front Office Supervisor

Receptionists

Chef-de-partie

Bell Boys

Cooks

Engineering Supervisor

Accountant

Purchase Clerk

F&B Cost Clerk

A/C and Heating Mechanic

Plumber

Waiters

FIGURE 3.14 | Organisation Structure of a Small Hotel

Restaurant Structures Large Restaurant Operations require more people to operate it. The amount of specialisations also increases and therefore, requires an elaborate structure. The structure below (Figure 3.15) is a representative one and can be modified according to the policies of the enterprise. General Manager

Assistant Manager

Controller

Cashiers

Receiving/ Store Clerk

Chef

Chief Steward

Sous Chef

Cooks

Stewards

Head

Dining Room Manager

Bartenders

Dining Room Captain

Cocktail waitresses

Food Servers

Busboys

FIGURE 3.15 | Organisation Structure of Large Restaurant

Small Restaurant Operations These properties may not have such elaborate structures. The owner/ Manager would have a direct control of operations. Figure 3.16 depicts a typical organisational structure of a small restaurant.

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Owner/Manager Cashier

Dishwasher

Head Cook

Head Waiter

Bartenders

Cook

Service Staff

Cocktail Waitresses

FIGURE 3.16 | Organisation Structure of a Small Restaurant

Fast Food Restaurant Structure The organisation structure of a Fast Food single unit is even simpler as shown in Figure 3.17 below. Outlet Manager

Short Order Cooks

Counter Staff cum Cashiers

Bussing Staff

Order-takers

Home-delivery Runners

FIGURE 3.17 | Organisation Structure of a Fast Food Restaurant

Organisation Structures by Job Profile There is another way to explain organisation structures.

Line versus Staff Line managers and operations staff in hotels and restaurants are those who have direct contact with guests and therefore, have a significant impact on direct revenues of the unit. Restaurant Managers, Banquet Managers, Room Service Managers, Waiters, Busboys, Dishwashers would all fall in this category. They are supported by Staff Managers who are specialists in their fields. They are support personnel to ensure the operations run smoothly as per the set standards. Some staff functions in restaurant operations are: Financial Controllers They help interpret financial statements and guide line managers in better decision making. They cost food and beverages operations and budgets. Lawyers They give legal advice on operations, especially when laws are different in many countries. For example, the Middle-East has strict rules for the service of alcoholic beverages while Europe may have strict laws on smoking and environment. Labour laws are vastly different in various countries, especially those which employ expatriate staff due to non-availability of skills locally. Big chain operations may have a full-time lawyer while smaller operations may consult a lawyer on a case-to-case basis.

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Facility Planners They help design restaurants and kitchens to local and international standards. Chains find it prudent to employ a full-time facility planner who is kept busy with properties being franchised each day across the globe. Standalone properties may hire a consultant. Dieticians and Nutritionists They provide advice on health foods and diets. Safety Experts They have joined the ranks of modern hospitality operations to safeguard the property and guests from all safety hazards, including fire safety, food safety, etc. They work at subscribing to international food safety programmes like HACCP and lead the implementation and in getting the certification. Basically, when designing structures, the human resources professional will group similar or related jobs into a function. So, accounts department will club all activities that relate to financial revenues and expenditures. Thus, we have credit, payable, cashiers, purchase, etc. clubbed into finance and accounting function. The challenge really comes in smaller operations which do not have the luxury of an elaborate structure. While the principles of clubbing related jobs remain the same, it is the clubbing of skills that becomes a challenge. So, a receptionist in a small hotel may have to do an unrelated skill of cashiering and telephone operation. This requires special people who can multitask. They are not easily available and have to be trained to execute those functions efficiently.

5. HOSPITALITY STAFFING NORMS The hospitality industry has over the years developed credible staffing norms to guide the human resources specialists to refer to when manning the establishment. Here, we are talking of the number of people required by an establishment. The hospitality establishment faces the challenge of deciding how many people to keep permanently and how many on part-time basis. There are several considerations to be made when thinking of numbers: 1. Availability of qualified people in the market. The establishment can hire fewer qualified people who are able to contribute immediately to standards. They may have to hire more people if they are unqualified because their productivity will be low. The market dictates how many to keep on permanent rolls. 2. The service industry is a people industry. Service is provided by people. Any service will require ‘warm bodies’ present irrespective of whether they are utilised or not. A waiter, for example, may have to wait idly at his station for a full shift without a single customer coming to his table. His presence is a cost borne by the establishment. The challenge then is whether to risk keeping fewer people who will be stretched at peak times with the risk of poorer service. 3. Human beings require a break to energise themselves physically and emotionally. They have their weekly off day as well as their annual vacations. The question arises as to who will fill the work void in their absence? So, do we hire a full time person to fill those leave vacancies or temporary workers? This is determined by the availability of trained temporary help at the time when they are needed. 4. Then there is the cost of human resources. In Asian countries the salary and wages constitute 12–14 per cent of sales, while in western countries the percentage can rise as high as 45 per cent. Salary and wages then become a critical cost component that can make or break the business. 5. Seasonal properties have another challenge. Do they staff their property to cope with peak season? If not, what happens when the season is in full flow? Are qualified human resources available in remote areas? If they staff the property for peak season, then the cost of carrying their salary during lean season is unthinkable.

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6. Some hotels have weekly cyclic flows of business. In some cities, the business drops on weekends because travellers want to be at home. In other locations like resorts, the weekends can be extremely busy periods because everyone likes to migrate to the resort over the weekend holiday. The cost of human resources has to be carried during the low cyclic periods. Is it cost-effective? Human resource planning has to take into account whether the establishment makes enough business during good business days to cover the cost in lean periods. 7. The image of the organisation is another aspect. Some hotels close their room service for the night shift to save costs. The human resource planner has to ask whether this strategy is good for the image of the establishment. Does the customer expect to have that room service operational in the night shift? If not, will he/she shift his/her business elsewhere? Many organisations clamour for better star ratings to qualify for higher tariffs and a better image. But this desire comes at a cost. To keep that image, the establishment will have to maintain some services even though they are loss making for the sheer image of the rating. A five-star property at a mountain retreat may have to keep the kitchen operational at night even though there may be one order after 12 midnight. 8. Then there is the issue of medical leaves and maternity leaves. Such extended leaves are really a nuisance to the establishment because they have to hire a replacement for the extended period. In other words, they are incurring the cost of two salaries during that period. They cannot deny extended leave due to prevalent labour laws that permit such leave legally. Given all these factors, the HRD Manager has the following norms (Figure 3.18) to guide him/her to man 300 rooms in a downtown luxury business hotel: Department/Position

Straight Shift

General Manager

1

Secretary

1

1st Shift

2nd Shift

3rd Shift

Reliever

Comments

Front Office Front Office Manager

1

Secretary

1

Asst. Mgr. F.O

1

Shift Supervisor

Relieves supervisors

1

1

1

Receptionist

1

1

1

Information

1

1

Cashier

1

1

1

1

1

1

1

1

Reservationist

1 1

The receptionist doubles on information work at night if business slows down

Uniform Services Lobby Manager

FIGURE 3.18 | Hotel Staffing Norms

The reliever can fill the reservationist’s post on her off day

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Department/Position

Straight Shift

Guest Relations Executive

1st Shift

3rd Shift

Reliever

1

Senior Bell Captain

1

Bell Captain

1

Concierge

2nd Shift

Comments Duty hours to cover peak times

1

1

Senior Bell Captain relieves Bell Captains

1

Bell Boys

1/100 rooms 1/100 rooms 1/100 rooms

Doorman

1

Transport Supervisor

1

Drivers Valet parking Attendant

1

1

1

1

1/vehicle

1/vehicle

1/needed vehicle

1

1

1

1

Drivers fill in at peak times. Doorman also does valet parking duties

1

1

1

Modern digital equipment permits a number of functions from the guest room

As per number of vehicles and duties

Telecommunications Telecom. Mgr/Sup

1

Telephone Operators

1

Housekeeping Executive Housekeeper

1

Secretary

1

Assistant Housekeeper Floor Supervisors

1

1

1/32 rooms

1/50 rooms

Public Area Supervisor

1

Linen Room Supervisor

1

Uniform Room Supervisor

1

Night Supervisor

1/7 supervisors

1

Room Attendants

1/16 rooms

1/16 rooms

1/30 rooms

Floor Housemen

1/floor

1/floor

1/floor

Linen Attendant

1

Uniform Attendant

1

Desk Attendant

1

1

1

FIGURE 3.18 | Hotel Staffing Norms (Contd.)

Oversees Floors and Public Area needs at night 1/7 room attendants

1

84

Department/Position

Human Resource Management

Straight Shift

1st Shift

2nd Shift

3rd Shift

Public Area Housemen

1/2500 sq. ft. 1/5000 sq. ft 1/2500 sq. ft.

Cloakroom Attendants

1/cloakroom 1/cloakroom

Reliever

Comments

1/7 P.A. Night shift clean Housemen banquets and restaurants 1

Cloakrooms at night can be cleaned by public area housemen. Remember there are male and female attendants

Laundry Laundry Manager

1

Desk Attendant

1

1

Laundry Supervisor

1

1

Washer man

1

1

Drycleaner

1

1

Sorter/Marker

1

1

Spotter

1

1

Flat iron

2

2

Hot Head Press

1/machine

1/machine

Steam press

1/machine

1/machine

1

1

Shirt Press

Assuming that the night shift works two shifts only

Horticulture Horticulturist

1

Head Gardener

1

Gardeners

1/5000 sq. ft. 1/500 sq. ft.

Health Club and Recreation Health Club Manager

1

Health Club Supervisor

1

1

Receptionist

1

1

Pool Attendants

1

1

Tennis coach

1

Will come on split shift

Gym Instructor (male)

1

-do-

Gym instructor (female)

1

-do-

Masseurs/Masseuse

1

1

Aerobic Instructor

1

Yoga Instructor

1

-do-

Tennis Coach

1

-do-

Squash Coach

1

-do-

FIGURE 3.18 | Hotel Staffing Norms (Contd.)

Will come on split shift

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Department/Position

Straight Shift

1st Shift

2nd Shift

3rd Shift

Reliever

Comments

Engineering Chief Engineer

1

Assistant Engineer

1

Engineering Supervisor

1

1

1

1

Plumbers

1

1

1

1

AC/Heating Mechanic

1

1

1

1

Electrician

1

1

Boilerman

1

1

1

1

Carpenter

1

Mason

1

Control Room Attendant

1

Daily Wagers are hired for major works 1

1

1

Food Production Executive Chef

1

Sous Chef

1

Chef-de-partie

1/section

1/section

Night chef

Commis in each section relieve each other

Commis I

1/section

1/section

1/section

-do-

Commis II

1/section

1/section

1/section

-do-

Banquet Chef

1

Banquet cooks

As per As per As per function function function requirements requirements requirements

Banquet cooks, may come on split shifts

F&B Service F&B Manager F&B Assistant Manager

1 1

May be deployed on a split shift

Restaurant manager

1/restaurant

Are present on split shifts except night club

Maitre de’Hotel

Restaurants

1/restaurant

-do-

Restaurant Captains

1/station/ restaurant

-do-

Coffee Shop Waiters

1/12 covers

Specialty restaurant waiters Hostesses

1/12 covers

1/12 covers

1/7 waiters -do-

1/8 covers

1/8 covers

-do-

1/restaurant

Night Club Restaurant Cashier

FIGURE 3.18 | Hotel Staffing Norms (Contd.)

-do1/8 covers

1restaurant

1/7 waiters -do-

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Department/Position

Human Resource Management

Straight Shift

1st Shift

2nd Shift

3rd Shift

Reliever

Comments

Bars Bar Manager

1

Bar Supervisors

Will come in split shifts where appropriate 1/bar

Bartenders

1/5 bar counter seats

Bar waiters/waitresses

1/7 Come on split shift bartenders in afternoon and evening

1/16 covers

-do-

Room Service Room Service Manager

1

Room Service Supervisor

1

1

1

1

Room Service Order-taker

1

1

1

1

Room Service Cashier

1

1

1

1

Room Service Waiters

1/16 rooms

1/30 rooms

1/100 rooms

1/7waiters

Pastry Shop Counter Salesperson

1

1

Pastry Shop Cashier

1

1

Delicatessen Salesperson

1

1

Delicatessen Cashier

1

1

Morning tea and breakfast is the busiest time

Sales Counters

Banquets Banquet Manager

1

Banquet Secretary

1

Banquet Coordinator Banquet Captains

1 Multiple

Banquet Waiters

1/7 waiters

Finance and Accounting Financial Controller

Based on the number of functions projected

1

Secretary

1

Financial Analyst

1

Income Accountant

1

City ledger Clerk

1

Payable Clerk

1

Wages Clerk

1

General Cashier

1

FIGURE 3.18 | Hotel Staffing Norms (Contd.)

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Department/Position

Straight Shift

1st Shift

2nd Shift

3rd Shift

Reliever

Comments

F&B Controls F&B Controller

1

Food Clerk

1

Beverage Clerk

1

Purchasing Purchase Manager

1

Purchase Clerk

1

Receiving Receiving Manager/Sup. Receiving Assistant Storekeeper

1 1 1/store

Food Store

1

Beverage Store

1

Store Assistant

1/store

We have the General Store

Human Resources Human Resources Manager

1

HRD Secretary

1

Recruitment and Selection Executive

1

Compensation Executive

1

Trainer

1

Sales and Marketing Sales and Marketing Manager Secretary Salespersons

1 1 Multiple

Based on Territory or Market Segment

Information Technology IT Manager

1

Hardware specialist

1

Programmer

1

Network specialist

1

FIGURE 3.18 | Hotel Staffing Norms (Contd.)

Staffing Ratios If one had to go strictly by the above table a 300-room hotel will be staffed well above the number of rooms. To help HRD specialists determine the number of staff that should be on roll, they are guided by a ratio of employees to the number of rooms. The following are a guide to such ratios:

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European and American hotels: 1:1 rooms because of the high cost of labour. The above hotel would be staffed by 300 persons. Some properties can have a ratio of 1:0.75 even. Asian hotels: 1:2 rooms. The above hotel would be staffed by 600 persons. This is a healthy ratio. Asian/African hotels where labour is cheap: 1:2.5 rooms. The above hotel would have 700 persons. The additional ratios will be still affordable because of the cheap cost of labour. Having said this, there are government hotels that have a ratio of upto 1:4 rooms to meet some social responsibilities.

Strategies to Reduce Staff The HRD specialist has the onerous task of bringing the number of employees within acceptable ratios. He/She has the following strategies to help in reducing staff:

1. Outsourcing This is increasingly becoming a popular option. Outsourcing is giving the task of certain functions to external experts at a fee. The outside contractor bears the cost of human resources while adhering to the strict standards of the property. In the hospitality industry, the following functions could be outsourced: horticulture, laundry, butchery, bakery, Information Technology development and maintenance, external cleaning services, engineering maintenance, maintenance of fire prevention systems and equipment, recruitment, training, legal advice, restaurant operations, night club, beauty parlour, health club services, recreation services, event management, outside catering, security services, barber shop, and flower shop. Outsourcing is successful only when there are reliable contractors who are qualified to provide high standards of service. For example, an external laundry will have to deliver laundered linen on time to meet the housekeeping needs of the day. Any delay will prevent the hotel from selling rooms.

2. Leasing A hotel can consider leasing some restaurants to save costs of human resources. In this situation, the hotel collects a rent for the space provided and is free from the hassles of running the establishments themselves. Night Clubs have been successfully leased to outside tenants. However, this strategy is weighed against the reputation of the establishment. There is always the fear by the hotel that the lessee may indulge in activities that do not conform to the high standards and reputation of the property. Branded restaurants are popular but non-branded ones are suspect. The financial strength of the lessee—who will have to tide over the lean periods of business—is also considered. There is the fear of them not paying their leases on time. Lease contracts have to be tight and foolproof. Some properties have gone into lengthy litigations bringing bad name to the property because of failure in payments which were to be made to the property by the lessee.

3. Curtailing Services Hotels have the option to reduce services or not offer them at all. For example, resort properties may not have a night shift for room service or guest laundry. Others may not provide valet parking services leaving guests to do their own parking. Hotels may do away with pastry shops and delicatessens as the volume of the business does not justify their existence. The hotel will have to consider the image of the property in choosing such strategy.

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4. Split Timings We know that some functions have their peak and low times. For instance, specialty restaurants are busy at lunch and dinner times. The restaurants are kept open only at those times. In such cases, the staff is given split timings to be present at open times only. The Guest Relations Executive is present when resident guest leave and return to the hotel in the day. She will time her presence to be there in these critical moments. The recreation coaches notice that the guests use their facility in the mornings and evenings only. Their facilities lie fallow during the day. They position their presence to those demand times.

5. Multi-skilling A great mantra for HRD purists is to get people to multitask. A receptionist is trained to give information, take reservations, and perhaps do cashiering. A cook can be trained to fill in any section of the kitchen, a Maitre d’Hotel doing Hostess duties when she is off. Such strategy is wonderful for the HRD professional who will be able to eliminate the relievers who are recruited to fill occasional offs in a week. A reliever is hired when he/she relieves six employees in a week.

6. Cross Coordination This is a wonderful strategy to fulfill 24-hour presence yet reduce staff. For example, the banquet reservations can be handed to the reception which has to be manned for 24 hours anyway. The receptionist is multiskilled to take banquet bookings. The laundry gets the bell desk to collect laundry at night for washing the next day. They can also deliver guest laundry in the evening eliminating the laundry valets in the evening.

7. Gender Adjustment Some positions like female room attendants need housemen to do heavy tasks in their shift. Some hotels have eliminated maintaining two persons in a shift by hiring male room attendants. They are able to do what the female attendants did along with the heavy work. A whole cadre of room-maids is, therefore, eliminated.

8. Part-time Workers Another strategy is to keep the hotel staff strength lean is by hiring part-time workers to tide over peak periods. This includes the assumption, that the part-timers are skilled as per the standards of the property. This does not always happen, leaving the part-timers to do semi-skilled jobs like bussing or to act as helpers. The banquet department depends on part-timers to fill in additional functions. We know that the banquet department relies on hotel school students to fill in the numbers gap. The students are motivated with the additional experience and pocket-money that they earn.

9. Summer Training One great opportunity to hospitality properties is to hire summer trainees from hotel management schools. The schools have, as part of their curriculum, a need to give industrial exposure to their students. Such exposure is for six months which is long enough for the property to schedule them into their regular workforce. The students come with some basic skills to perform at non-critical positions. Students are motivated to complete their compulsory internship while earning some stipend. These students can fill in leave vacancies during that period at a cheaper cost, thereby saving the property from having permanent relievers.

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10. Maintenance Contracts The engineering department can benefit in numbers by extending maintenance contracts to suppliers of equipment. It makes good sense, especially as equipment is getting more sophisticated much of it being computerised. The suppliers would be the best to maintain such equipment with genuine spare parts and accessories. It relieves the engineering department from having specialists on their rolls to deal with the host of equipments in service. It saves them from carrying huge inventory costs of spares. Some of the areas where maintenance contracts work well are: elevators, telecommunications, fire alarm systems, housekeeping equipment, computer networks, close-circuit television networks, etc.

11. Just-in-time This process is highly successful in the Japanese automotive industry. Many industries have adopted the system for their needs. The hospitality industry is just a step away from it becoming a permanent way of life. Just-in-time works on supplies reaching the premises just in time for its need. This does away with large storage areas and the human cost of maintaining them. For example, the kitchen raw materials can reach just in time for the lunch production. Items are received fresh and the staff can avoid maintaining huge inventories. The system can only work if the suppliers are extremely reliable, both in terms of quality standards of supplies and delivery time reliability.

6. JOB ANALYSIS What is a job? A job is a paid individual performance that contributes to organisational objectives. Jobs must, therefore, be specified in terms of desired end results. A job has individual tasks and activities that are put together to create a performance. People see jobs more than a performance. They see it as a source of livelihood, and therefore, the job has to be protected and executed to the best of one’s abilities. Organisations see jobs as value-added contributions to their purposes. They do not wish to carry ‘passengers.’ Each job must contribute significantly in taking the organisation forward. If this be so, tasks and activities have to be carefully considered to add value to the organisation. This consideration is called job analysis. Earlier, organisations saw jobs also as a way of contributing to society’s social needs. They created employment. It did not matter how well they performed. Jobs in the government and the public sector undertakings are good examples of this. Job Analysis (or Work Analysis) is a systematic process of gathering information about work, jobs, and the relationships between jobs as also the knowledge skills and competencies required to perform the job successfully. The main focus of this approach in the service industry is to satisfy the needs of customers. This determines how the employee (internal customer) has to perform to satisfy that customer need. In other words, the customer defines how a server has to perform. This is the only sure way to stay in business. A Job Analysis determines the broad essential elements of a job. This step is important and has to be accurate as all following tasks faithfully follow what is recorded in this exercise. Components of a job analysis are content, job requirements, and context. The content is composed of the tasks and activities in a job; the requirements are the specification of the job holder to successfully do the job; and the context is a brief sentence as to how it contributes to the organisation. The following chart (Figure 3.19) gives the typical kind of information derived from a job analysis:

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Work Activities: l Work activities and processes l Procedures used l Reports that are generated by the job position l Responsibilities and accountabilities Equipments and Tools used Job Context l Physical working conditions l Reporting relationships l Work schedule l Job category (management, supervisory, skilled, semi-skilled) l Incentives (financial and non-financial) l People the job holder coordinates with internally and externally Job Significance l Products and services provided l Materials processed l Role in the service chain (initiator, sub-processor, end-processor, all-rounder) Work Performance l Criteria of work measurement l Work standards l Limits of error Personnel Requirements l Job-related knowledge l Job-related skills l Job-related competencies l Type of education and training l Special certifications required l Personal attributes

FIGURE 3.19 | Job Analysis Chart* * Adapted from Job and Task Analysis by E.J. McCormick The major guidelines for a Job Analysis are: 1. Job Analysis should arrive at observable behaviours and work outcomes. A job description is the logical outcome of this exercise. 2. Job Analysis focusses on the position and the person. It includes the desired knowledge, skills, and competencies of the performer to do the job. 3. It links to the Performance Appraisal System which determines how well the job components have been fulfilled. Job Analysis determines how the job will be measured. 4. The data collected must be reliable and verifiable. It should be recorded meticulously to avoid any future litigation that arises from it. Another step in the process of analysis is to see how we are going to measure performance. The measurements in the case of a Front Office Receptionist can be: 1. The number of guest complaints received 2. The number of rooms assigned correctly (or wrongly) 3. Number of tasks not complete from the previous shift.

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4. 5. 6. 7. 8.

Number of employee complaints Correct tally of room between the room rack and housekeeping Time taken to register a guest Number of wrong entries into the Fidelio computer system Amount of additional revenue earned through upselling

A crucial next step in Job Analysis is to ascertain the knowledge, skills, and competencies required to do the job. Knowledge is the organised body of information (usually of a factual or procedural nature) applied directly to perform the job. For example, a front office receptionist must have the knowledge of the systems and procedures adopted by the hotel to register a guest. He/She must further know the potential of the Fidelio computerised system before he/she can use it to give a quality performance. A Skill is the ability to perform a trained psychomotor act which includes manual, verbal, or mental handling of data, people, or things. So, the receptionist must also know how to execute the procedure or make an entry into the Fidelio system. Competence is an appropriate behaviour required to perform a job. The receptionist must demonstrate etiquettes and courtesy while dealing with the guest. She must also be well groomed to project the image of the property. The next step is to see whether the job is done by an individual, team, outside contractor, full-time, or part-time. The sequence of an effective Job Analysis would then be: 1. 2. 3. 4.

Determine the desired outcomes and measures of the analysis. List the essential broad elements of the job. Determine the knowledge, skills and competencies required to do the job. Determine who is to do the job to get maximum effectiveness.

If we were to take the example of a Front Office Receptionist, his or her job analysis would generally look as is given in Figure 3.20. The information given in Figure 3.20 is derived by: l

l

l

l

Observation: The person doing the job analysis (usually the HRD manager or Line Manager) can simply note a receptionist doing his or her job, over a period of a week and list the components of the job that occur regularly or infrequently. Observation hastens the collection of data using practice by someone else rather than having to re-invent the wheel. The benefit of observing over a week is to determine repetitive jobs from those done occasionally. The ones done repetitively become the core of the job. This may be further confirmed by observing others in a similar role. Interviewing: This is a method of questioning the employees, supervisors, managers, and customers regarding their expectations and perceptions of the job. A server does not work in isolation. His or her efforts impact others in the service chain. For example, the cashier may want the receptionist to clarify in advance the payment mode when settling bills, at the time of registering them. This helps the cashier in quick processing of the guest bill settlement. Then again, a guest may want the receptionist to pre-register him or her to avoid delays at the time of arrival after a long flight. These expectations can be brought in as a component of the job, if required. Brainstorming: This is a method to get servers and those influenced by his or her work, like the supervisor, fellow servers, kitchen personnel, support departments, etc. to sit in a room and discuss the job elements. The brainstorming can also be done by experienced people of the industry. Review of Existing Job Descriptions: This is a common method employed. Other existing job descriptions are taken from other hotels or textbooks and modified to the establishment’s need.

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Context The Front Office Agent registers all guests into the hotel with courtesy, following the prescribed systems and procedures. She enhances room sales using modern sales tools. Job Dimensions l Taking over a shift l Assessing arrivals and room position l Registration of guest l Allocating a room l Updating room position with Housekeeping l Upselling rooms l Coordination with the Bell Desk l Using Fidelio software l Generating occupancy reports Person Profile

Knowledge l l

Front Office Systems and Procedures Fidelio Computer Systems

Skills l Customer Relations Skills l Suggestive Selling l Computer Skills l Problem-solving skills l English language skills with preferably speaking proficiency in another foreign language l Computer literate to use E-Order pads Competencies l Energetic and physically fit l Well groomed l Team worker l Disciplined l Etiquettes and manners l Caring and sensitive to guest needs

FIGURE 3.20 | Job Analysis* * (Front Office Agent) Receptionist l

l

l

l

Work Sampling: Is a method of actually doing the job over a period of time and determining the job components by oneself. This is a tedious, but sure method and is time consuming. Often, supervisors are asked to develop the job elements as they have the appropriate know-how for these. Guest Comments: Many establishments install a written guest feedback system for improvements in products and services. For example, a questionnaire is presented to the guest at the end of the dining experience, which guests fill on a purely voluntary basis. Analysis of Records: Some records like sales-generated, breakages, material consumption, etc. can give valuable insights into the job performance. Role Clarification: Role clarifications are conducted by professional companies as a measure of recording the contributions of its employees. The appraisals note the expectations and contributions of the superior and the subordinate. It also states the employee’s own perceptions of the role.

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l

l

l

Hiring Outside Consultants: They have the know-how through experience to give an accurate account of a job, or may do the exercise of Job Analysis and the following tasks for a consultancy fee. Critical Incident: Noting worker behaviours that are critical for very good or bad performance. The incidents give the range of behaviours that are displayed under pressure. Video-Recording: The job is recorded on video for playback and analysis. Some training films can give an insight into certain jobs.

Outcomes of Job Analysis There are a number of benefits of Job Analysis. It brings out several subsequent processes that are essential to human resource management. 1. Job Descriptions which are formal documents profiling jobs. 2. Job Evaluation to evaluate the intrinsic worth of a job to determine compensation. This is a very scientific process adopted more by organisations these days. The Hays system of Job Evaluation reigns supreme in this category. (see “Job Evaluation” in Chapter 10 for details) 3. Job Design is the process to modify a job to suit changing circumstances. Individual broad components can be added or deleted to suit given situations. Job design can be used to enlarge or enrich the job to earn better responsibilities and remunerations. (see “Work Design” later in this chapter). 4. Job Specifications are formal documents that profile the person to do the job in terms of knowledge, skills, and competencies. Job Specifications are useful in framing job advertisements. 5. Performance Appraisal is a systematic method of evaluating a person’s performance in a given time period. Since the Job Analysis throws up what has to be done to meet the criteria to measure performance, performance appraisal becomes easier. 6. Career Plans to determine the next steps in the advancement of the individual. We know exactly the additional jobs and exposures an individual requires to claim advancement. Such progress can be planned to have the individual ready when the vacancy arises. 7. Continuous Improvement is a process of improving upon what already exists. HRD planners can research into jobs to see how tasks can be made more efficient. 8. Health and Safety concerns emerge when analysing a job. The HRD Manager can evaluate what jobs are exposed to health hazards (as in the case of housekeeping that use toxic chemical cleaners to remove stains) or those that are clearly not safe (such as external window cleaners). 9. Legal Concerns are thrown up when components of a job are studied. Some societies may not permit women from serving at bars. Labour laws may not permit working beyond certain work hours without compensation. 10. Recruitment and Selection is a strong area that benefits from Job Analysis. Recruiters know exactly what to look for when sourcing, interviewing, and selecting. 11. Training and Development becomes most effective when we know exactly what knowledge, skills, and competencies are required. It becomes easier to evaluate training needs of individuals as well as functions. The Task List (which we learn about next) become ideal material for training programmes.

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Task List From the Job Analysis, which spells out the broad components of the job, we go on to the next step of listing the tasks in each component. This process leads to what is called the Task List (or Job List). The task list focusses on: l l l l l l

Specific duties Work units Materials Equipment Administrative tasks Other requirements

Taking the example of the Job Analysis of a receptionist as mentioned above, one job component is called Registration which is enrolling the guest into the hotel. The tasks of the front office receptionist within the broad component of Registration are reflected in the task list given below. The Task List clarifies the establishment, the department, the job position, and the function concerned (Figure 3.21). This activity brings out the following tasks: Specific Duties: Handing over the registration form, checking the form after completion, verifying the proper name, address, passport details, room rate confirmation, payment option, and checking the authority of credit facility. Work Units: The list gives units like time for registration and room selection. Materials: In this case, the only material handled is the Registration Form. Equipment: Computer Administrative Tasks: Informing telephones and Room Service; creating the Guest Folio; requisitioning supplies; and generating reports. Other Requirements: Tallying room position with Housekeeping and telephones, Scanty Baggage Procedure, VIP procedure, Group procedure, etc. ESTABLISHMENT: XYZ Hotel DEPARTMENT: Front Office JOB POSITION: Front Office Agent JOB FUNCTION: Registration procedure l l l l l l l l l l

Smile when guest approaches the reception counter. Wish him or her the time of day and welcome him. Enquire if he/she has a reservation. Check for reservation or room availability on computer. Check if guest is a regular guest and check history card. Hand over the Registration Form and ask guest to fill it. Check form when filled and ask guest to fill any incomplete information. Ask guest if he/she has any room preferences. Check room availability and allot room. Hand over the room key and wish guest a pleasant stay.

FIGURE 3.21 | Task List

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This detailed listing then becomes the base information on how the job is done and acts as a valuable training material. The list can also incorporate the systems and procedures adopted by the property as also the standards to which the task is to be aligned.

7. JOB DESCRIPTIONS AND JOB SPECIFICATIONS Job Description A job description is a written profile of a job. Job Analysis and making a Task List ascertain this. The key issues listed in a Job Description are: the job title, category, reporting relationships, job summary, duties and responsibilities, levels of authority, and the departments that the job position coordinates with. The format may vary as per the practice of the establishment and can incorporate other information as well such as critical external customers, equipment used while performing the job and working conditions. These job descriptions can be made public in job advertisements and company websites, if required. The Job description can incorporate the job specification (discussed next) to complete the document. Continuing with the example of the receptionist, his or her job description is given in Figure 3.22. Typical good job descriptions observe certain rules: l l l l l l

Using a terse, direct style with action verbs (e.g. establish, prepare, handle, Inform, etc.). Using the present tense. Each sentence must reflect an objective either tacitly or through implication. Each word should provide information about the job. Unnecessary words must be omitted. Use words that imply only one meaning. The job description must reflect the scientific data collected through job analysis. Re-engineering of a job requires a separate job analysis.

As one sees in the job description of a Front Office Agent (Receptionist), it has the following information: Job Title: The job title is the name of the job position as reflected to the customer or the external public. It is different from designation which is a name given to the job that reflects in grading structures to bring parity between jobs. For example, the Front Office Agent position mentioned above may have a designation of Front Office Assistant to compare with assistants of similar level of responsibilities and compensation structure in other functions. So, a front office assistant will compare with a Health Club assistant. This parity is achieved through job evaluation discussed in detail in Chapter 10. Category: This distinguishes the level of the job in terms of management, supervisory, skilled, and unskilled workforce. This is particularly useful when the organisation gives fancy titles for public consumption, but needs an indication internally where that positions fits. Some organisations may even mention the grade scale or its number, e.g. 3000-250-5000-275-8000 or grade 10. In modern organisations, this term is replaced by the term ‘job family.’ Basically, job families are groups of jobs with similar end results. Within a job family, levels of work can be differentiated. The differentiation is based on output or contribution. A job family is distinguished from another job family, based on the level of knowledge, skills, and competencies required to do the job. Therefore, management orientation may be more towards planning and organisation while supervisory positions require more controlling and monitoring.

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Job Title:

Front Office Agent

Category:

Skilled

Reports To:

(a) Shift Supervisor (b) Front Office Manager

Job Summary:

To reserve, register, and assign rooms to guests and be a continuous source of information during their stay, within the policies, procedures and standards of the establishment.

Duties and Responsibilities:

1. Be informed of daily room status at the beginning of the shift to schedule allocation correctly. 2. Have detailed information regarding arrivals, their room requirements and expected departures for the day to manage room allocation. 3. Check the VIP reservations and issue VIP amenities voucher for fruits and flowers, beverages, etc. and any other special requests to give special services as per policy. 4. Prepare all records connected with the pre-registration of VIPs, invalids, handicapped and old people to reduce time at the time of check-in. 5. Handle group/crew registration as per laid down procedures. 6. Allot rooms to all arrivals using laid down procedures. 7. Constantly update room position (room racks in the manual system) to be able to attain high occupancy. 8. Open guest folio and send it to the Front Office Cashier for commencing the billing cycle. 9. Requisition fresh linen and flowers from housekeeping to decorate the reception counter. 10. Update rack rates as per yield management guidelines to maximise revenue. 11. Prepare a room discrepancy report and ensure a double check through the bell boy. 12. Work closely with the cashier and concierge to provide good service. 13. Inform housekeeping desk promptly of all guest departures to have them ready for re-sale. 14. Prepare occupancy statistics and room reports for decision-making. 15. Upsell rooms to increase room revenue. 16. Tally room racks with the room service and telephone operators (in the manual system) to give coordinated guest service. 17. Handle scanty baggage as per procedures.

Coordinates With:

Room Service: to update the room position and provide VIP amenities. Lobby: for arrival and departure procedures. Housekeeping: to inform the arrivals and departures of guests for room cleaning schedules. Engineering: for the maintenance of front office equipment. Telephones: to update room position.

FIGURE 3.22 | Job Description Reporting relationship: It is important to give the job position of the immediate boss. Good management principles allow one immediate boss. This is going to be the position for day-to-day direction. The boss will appraise his/her performance. Functional structures may have a position reporting to one immediate boss for administrative reasons and report to the functional specialist in the headquarters for technical guidance. This happens in divisionalised operations and chain operations. We see in the job description example above that

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there is another position mentioned. This is the boss’s immediate superior. This position is mentioned to enable the job holder to know who to go to in the long-term absence of the immediate boss. The immediate boss may be absent due to the annual vacation, sabbatical, temporary deputation to another assignment, etc. The boss’s superior then becomes the boss unless there is a temporary replacement to the boss’s position. The boss’s superior has another significant role. He/She is the second appraiser in the performance management system (see Chapter 4 for details). As a second appraiser, he/she nullifies any bias of the immediate boss and acts as an arbiter in differences. An employee has the comfort that there is another impartial party observing his/her performance. Job Summary: A job summary encapsulates the expectations of the management from the job holder. It specifies why the job exists. It is usually one sentence or maybe two. Other terms for it are ‘primary function’ or ‘job content’. It is the phrase used in job advertisements to explain the content of the job to future applicants. This statement is difficult to compose as it has to reflect the essence of the job. Each word has a significant meaning reflecting, maybe, one or many activities. For example, the word “reserve” in the job summary of the reception in fact has several sub-activities to make that action complete. Duties and Responsibilities: This is the main gist of the job description. It brings out the work activities essential to the job. Sentences start with active verbs, are terse and to the point. They also have an objective for each action so as to make these duties result oriented. Employees also like to know the ‘whys’ of each task. They get a total picture of the activity rather than a prescriptive narrow view. Coordinates With: The term can be represented in other words such as ‘internal linkages’ or ‘primary relationships’, etc. The main purpose is to list the people the job holder will coordinate with and how for the successful completion of the job. For example, the receptionist cannot be successful in rooming a guest unless the bellboy carries the guest baggage to the room. The bellboy gets the cue from the receptionist to room a guest. This coordination is essential to the job. It also helps in cross-training the job-holder in other coordination positions to get ‘their point of view’. While these are the essential components of a job description, it can get richer by adding additional information, such as: l

l

l

External Linkages: i.e. the external people or organisations that the job-holder coordinates with— the customer being the most important. So a purchase manager may have to deal with suppliers just as a sales manager has to deal with corporate houses. Equipment and Materials Used: This may be essential for job positions that may operate sophisticated equipment and materials. A room attendant must know how to use a vacuum cleaner just as the IT engineer needs to operate mainframe servers. Public area cleaners may use materials such as toxic cleaners while cooks handle food. Each requires separate expertise and precautions to handle those materials. Job Specifications: Some organisations include the job specification to make the document comprehensive. Others may have separate job specifications explained next.

Job Specification A job specification (Figure 3.23) is a written document that profiles the person who has to do a given job. It is the most important document for the hiring process. A job specification is driven by the following sub-headings:

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l l l

Job Title Education Skills

l l l

Category Experience Competencies

The information in this document has been gathered as part of the Job Analysis process. Unnecessary specifications can make the hiring process more difficult. Higher qualifications could also add to the labour cost. Care must be taken to precisely define the specifications to make it simple and cost effective to the recruiter. The example of the front office receptionist continues here: Job Title:

Front Office Agent

Category:

Frontline staff

Education:

Graduate with preferably a Craft course in Front Office Reception A minimum of I year.

Experience: Skills: l l l l l

l

Customer Relations skills. Suggestive Selling Computer Skills Problem-solving skills English language skills with preferably speaking proficiency in another foreign language Computer literate to use E-Order pads

Competencies: l l l l l l

Energetic and physically fit Well groomed Team worker Disciplined Etiquettes and manners Caring and sensitive to guest needs

FIGURE 3.23 | Job Specification As one observes, a job specification has the following information: Job Title: The title must conform to the job description. We know by now that job descriptions and job specifications are paired to give a composite view of the job. Therefore, the job title must have a consistent terminology to facilitate matching. Job Category: This has the same purpose as discussed in preparing the job description mentioned earlier. Education: These are the minimum academic qualifications required to be able to comprehend and execute the job requirements. While setting these, it is important to see the market availability for such talent. While a city hotel can stipulate a graduate qualification as a minimum requirement to do a Front Office Agent’s job, a remote resort property mentions high school as the minimum requirement. The job challenges, of course, would reduce in the latter making tasks much simpler. A remote front office operation may work on manual systems, while an upmarket property in the city may need computing and analysing skills.

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A job analyst may have an additional section stipulating technical certification. Some jobs are highly technical and require special certification to qualify for a job. The nurse in the hotel clinic may require a certification from St. John’s Ambulance or Red Cross in CPR and emergency medical attention. An IT professional may need an additional technical qualification in cabling and networking to perform the job. Remember that the qualifications must match the job requirements. Sometimes, jobs will have to be modified to meet certain limitations of availability of trained professionals locally. Skills: These are the psychomotor abilities required that are acquired through training. For example, customerrelation skills are vital in the service industry. A person should have gone through a training programme to acquire the skills. Some skills are supported by certification, while others are in-house programmes that confirm that such training has taken place. Competencies: These are professional behaviours required to do the job. These are personal characteristics that differentiate from job skills. These characteristics are personal and driven by a person’s exposure and background. For example, not everyone may know professional etiquettes. These can be taught if the person is willing to learn. A competency seen at the time of interview for customer service jobs is a simple smile. It is amazing how this is lacking in many job applicants. Some job analysts set behaviour indicators to clarify the competency as shown in examples (see Figure 3.24).

8. WORK DESIGN We have seen in this chapter that an enterprise is a complete system working in a larger environment. Management, therefore, shapes the organisation to respond to the changing environment. This shaping is called organisation structure. It is a macro-design that deals with the organisation as a whole. But there is another aspect of an organisation and that is Work Design or Job Design. Work design is looking at jobs (micro-design) to see how they can be made effective for the organisation. Work design has an added value in modern times when organisations are moving towards leaner structures, fewer numbers, induction of knowledge workers, the surge of technology in operating systems, and the need to motivate the modern worker. Modern workers are more educated possessing a wide range of skills. The old ‘carrot and stick’ method of motivating employees is no longer tenable because pay (used as a manipulative instrument) alone cannot motivate people who now want self-actualisation and the autonomy to control their environment. Employees want job satisfaction which is achieved by giving employee meaningful and responsible roles. Work design crafts jobs in such a manner that the modern aspirations are met. Research shows that satisfied workers produce more, are less absent from work, stick to their job, etc. which in turn improves organisation effectiveness.

Work Design Methods Job Enlargement As the term suggests, job enlargement is making the job bigger by adding additional tasks to be performed. The diagram below sets the example of a traditional front office receptionist of a hotel and how her job is enlarged to accommodate her additional skills. Her traditional tasks are in white while her enlarged tasks are shaded portions (see Figure 3.25).

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Integrity

Negative l Is willing to sacrifice the company’s values (quality, customer service, standards, etc.) in exchange for a short-term solution to an immediate problem in order to save time, effort for a quick fix. l Critcises team mates and the company and its policies in front of outsiders (suppliers, customers, principals) to make himself/herself look better, regardless of others. l Looks for personal rather than company gain—especially if these are conflicting—asking “What’s in it for me?” l Is quick to offer large discounts and inducements in order to get the business. Positive l Insists on company values being uppermost from the beginning of the negotiations and that company values should be upheld, whatever the principals, suppliers, customers are suggesting. l Even if privately disagrees with the company’s policies and colleagues, does not express it in public. l Does not make rash promises l Sells on quality, service, and company values—not just on price l Does not engage in a win-lose confrontation l Shows flexibility within a certain range, but will not compromise on values l Is transparent in dealings with customers and colleagues. Does not have any hidden agendas. Result-Orientation

Negative l Makes suggestions without considering the consequences l Interested in only short-term results without considering the long-term impact l Will make sacrifices for immediate gain with no future thinking l Sees things in terms of activities rather than objectives or results l Day-to-day attitude l No ‘big picture’ thinking l Will use all resources on one quick result without thinking of other requirements in the future Positive l Keeps reminding others of long-term objectives during the negotiations, rejecting suggestions which conflict with these l Talks about long-term, overall objectives at the start of the meeting, not leaving to the end or not mentioning them at all. l Has strong sense of budgeting, planning, and thinking about the future l Will make short-term sacrifices and is flexible on small matters in order to gain good overall result Innovation

Negative l Satisfied with the way things are, avoids change l Old-fashioned, conservative in outlook—rejects new things which are different l Plays safe, goes for guaranteed, low-risk options l Keeps saying “It won’t work” or “What if it doesn’t work?” or “It’s better to stick to the old way we’ve being doing before” l Copies others with tried and tested solutions rather than sticking one’s neck out l Suggests ideas, but reluctantly, and has no confidence that they will work Positive l Takes a different view, is risk-taking and outspoken l Individual style in dress and manner l Suggests ideas off the beaten track l Understands and embraces newness enthusiastically saying, “I like this, it’s new, it’s different”

FIGURE 3.24 | Behavioural Indicators

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Print Out Arrivals of the Day

Tally Arrivals with Departures

Check Room Availability

Produce Room Reports

Receptionist

Register a Guest

Take Guests on FAM Tours Tally Room Status with Housekeeping

Update Guest History Information

Provide Information to Guests

Take Room Reservations

Assign a Room Key

Upsell rooms to Enhance Room Revenue

FIGURE 3.25 | Job Enlargement Job enlargement has the following benefits as interpreted from the example above: (a) Reduces routine and boredom in the job because of the variety of different tasks. (b) Makes the job more meaningful and satisfying. The organisation benefits with more contributions from one individual. (c) Provides greater utilisation of skills and competencies as modern workers come with greater knowledge and skills. In the example above, the receptionist has to possess computing skills, sales skills, report analysis, guest relations skills, etc. (d) Makes the individual feel more complete and responsible. (e) Provides her with multiple skills. She can be deployed at reservations, Guest Relations, Sales, etc. in a situation of crisis. (f) Prepares the employee for other positions in her career plan (as the receptionist can move to Sales, Guest Relations). (g) Has greater accountability to generate revenue (as she has moved from a rooming clerk to a revenue generator. (h) Has greater control in the reception. (i) Has some management skills added (generating reports) so that she can analyse and be part of front office strategies. There are some assumptions here: 1. The worker is willing to take on the enlarged responsibilities. 2. The worker has the knowledge, skills, and competencies to take on additional tasks. The organisation would need to prepare the worker, both in motivation and in skills, to take on the enlarged job.

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Job Enrichment This method is very similar to job enlargement in as much as it expands the content of the job. The difference is that job enlargement expanded the tasks horizontally to include jobs related to the role, while job enrichment integrates tasks from higher jobs. It would typically involve managerial functions to bring about greater control on the job. The diagram below (Figure 3.26) depicts this concept well: Planning and Controlling

Job Enrichment

Additional Management Tasks Job Enlargement

Receptionist Additional Front Office Tasks

Update Guest History Information

FIGURE 3.26 | Job Enrichment In this method, the worker is doing the tasks of someone senior to the job position. This is a wonderful direction towards autonomy and empowerment. Modern organisations are working very fast today at providing enriched jobs to the knowledge worker because he/she comes with more education and awareness. The best form of motivation is when the individual has control over his/her environment and has a say in its future direction. Job enrichment provides the opportunity. We have learnt about flatter organisations. Job Enrichment helps in de-layering organisations. Therefore, what a supervisor did before is now done by a person in lower position because he/she has better skills and competencies. Of course, in such scenarios, the HRD manager has to think of innovative job titles to truly reflect the new roles. The receptionist, therefore, may be re-titled the Front Office Executive or Front Office Coordinator. In job enrichment, there is greater accountability and authority to make decisions that were earlier made by superiors. The receptionist is now responsible and accountable for the total guest experience. She may have the authority to upgrade a room for a regular guest or authorise special guest amenities. This was something that was done by her supervisor before. Here, the information processing that was done by a supervisor before is now done by computers.

Autonomous Work Groups This work design believes that people are more productive if they are part of a larger picture than a small tile in the large jigsaw. Take the example of a restaurant operation. A restaurant is divided into stations of allotted tables. Each station has a captain (team leader) and a set of waiters and busmen. Earlier, each had a specific role to complete. For example, the waiter would serve, the busman would remove soiled dishes, and the captain would supervise these tasks. The restaurant manager was responsible for the revenue budgets, sales efforts, food promotion, etc. In autonomous work groups, each station is given a target and they work out how they were going to achieve it. This involves everyone doing jobs beyond their traditional roles. Soon, the captain builds the client base and keeps calling cards of the people served, and call them often to come back again. He develops a personal rapport with guests remembering their special likes and dislikes. His personalised

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attention brings customers back. The captain, waiter, and busmen now have a larger picture of what they have to achieve than just provide service. They even go out into the market and promote their restaurant to prospective clients. This motivates them and brings out skills not thought of before. The Fast Food chain operations use autonomous work groups well. They make each restaurant an independent business unit responsible for their own profit and loss, customer relations, quality of food and service, etc. under certain corporate guidelines. Everyone in the autonomous business unit now thinks like entrepreneurs and generate ideas on how to increase revenue and effectiveness. They can draw upon the corporate resources to augment their efforts. The general argument for autonomous work groups is that they encourage job enlargement and job enrichment. People form what Tavistock Institute of Human Relations in London called “socio-technical systems.” Autonomous groups bring out their own synergy and work rationally. They assign jobs within their group and make use of talents within members of their groups. It gives a greater group freedom, thereby unleashing greater motivation. They also meet their social needs of belonging and interaction, rather than being an isolated entity in the organisation sea.

Benefits of Work Design The individual, group, and organisation can benefit from work design. Let us look at each:

Individual l l l

Gets a more meaningful job Has a larger picture of the organisation Is more in control of the work environment

l l l l

Links to career growth Utilises a range of skills and competencies Has more authority Relief from boredom

Group l l l l

Meets social needs People more cooperative Members become “entrepreneurs” Releases group synergy

l l l l

Releases creativity Sees the bigger picture Requires less supervision Group freedom

Organisation l l l

Has a more flexible workforce Gets greater commitment Able to motivate the knowledge worker

l l l

Has a satisfied workforce Able to develop resources from within Able to reduce numbers and layers in organisation hierarchy

9. HR BUDGETING Introduction A budget is a formal financial statement of revenue and expenditure for a future period. It is a process of setting goals that are attainable and comparing them to the financial performance of a previous similar period. The key to successful budgeting is the planning process where long-term and short-term objectives are in place, supported by sound policies and procedures. A budget serves the following purposes:

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It establishes the desired rate of return required by the investors. It establishes the cash flows required to achieve the targetted figures. It gets people thinking of the future. It sets goals against which performance can be measured. It is a measure of success. It sets parameters of expenditure that is acceptable to the business. It enhances management control. This is achieved by comparing the actual expenses against the budgeted amounts.

A budget is a management tool and not an accounting tool. However, it uses the accounting process established for a business. An understanding of accounting reports is essential to prepare a budget. The person making the budget must know the components of a profit and loss statement and how it is presented. It only differs from pure accounting by noting predictions, while accounting records actual facts. The HRD budget must cover a period that is controllable. Most hotels prepare an annual budget for a reasonable period for control. The question arises, ‘why do we budget?’ Budgeting is a management control function and improves the process of control. A budget works on the basis that business plans go according to schedule. Unfortunately, this is not always so. Plans are influenced by unanticipated factors internally or externally. An employee strike can affect plans just as much as a new sales tax can affect plans and budgets. Plans must be able to take remedial steps. Budgets have to be altered accordingly. Sometimes, plans have to be altered by deficiencies thrown up in the budgeting process. For example, a plan may include an expensive training programme with external experts, but the present cash flows reveal that the training programme cannot be held due to unpredicted business trends.

Preparing a Budget There are two types of budgets: the capital budget which is a statement of assets like training equipment, classrooms, furniture, etc. that will be used for a longer period; and the operating budget that lays down those anticipated expenses like stationery, printing costs, etc. to do business on a daily basis. When preparing a budget, there are certain rules to be followed: l

l

l

l

l

l

l

The goals set by a budget must be attainable. Many investors have set unrealistic tight expenditures that demoralise the HRD team. There should be wide participation in the budgeting process. An HRD Manager who prepares the budget without involving his or her HRD team can set goals that the team is unable to attain. Participation of the team gets their commitment to perform and achieve. All members of a team must be informed of the approved budget. Many HRD Managers believe that they are the only ones privileged to see the budget and try to steer the team towards it when the team itself is in the dark as to what they are expected to achieve. The budget must be completed before the performing period. The HRD team cannot be held accountable for time that has elapsed. We have seen that the budget is a measure of performance. The HRD team must know exactly what their role is in the attainment of the budget goals. The HRD team, once given targets, must have authority and control over their work process. They must be able to influence the amount that they are accountable for. Budgets must be flexible to permit revisions for unanticipated changes.

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Revenue Forecasts The first step in the budgeting process is determining the desired sales required. The revenue received is the yardstick on what can be spent. Revenue producing departments like food and beverage and the front office have to work hard to support staff departments like IT, Engineering, Accounting, etc. in their budget. Modern hotels expect HRD to contribute indirectly to the increase in performance to actualise sales. Alternatively, hotels may treat HRD as an internal consultancy cell responsible to give valued HRD services to revenue departments and earn their sales from such services. There are two possible ways at arriving at desired sales figures.

ROI (Return on Investment) Method An investor normally sets a target of net profit based on the desired rate of return on an investment. So, if he has invested $20 million in the hotel project he may say that he wants a 15 per cent return on that investment each year for the next 7 years. That figure translates into $3 million a year. This contribution comes from all the revenue departments. The return on investment was set in year one by the investor. This figure increases year by year to factor in the present value of the investment. Sometimes, the investor is reasonable and takes the product life cycle into account. Every product has four stages in its life—introductory, growth, maturity, and decline. The investor may lower his return on investment in the introductory stage of the property but get more aggressive in the growth stage, and then may ease out at the mature and decline stage. Working backwards, the accountant will add the prevalent income tax percentage. He will then add fixed charges like depreciation, insurance, and interest on loans taken, to arrive at the gross operating profit (GOP). The GOP reflects the efficiency of the operations in controlling expenditure. It represents the operating costs to run the business. Hotels consider a 30 per cent GOP as healthy. Each department is concerned with GOP as a measure of their performance, while the accountant will be concerned with figures relating to tax, insurance, interest, and depreciation. HRD is being increasingly looked upon as a revenue centre. Later, all the costs to run the business like salaries and wages, heat, light and power, stationery costs, etc. are added to arrive at the gross profit. This may vary based on the hotel’s unique circumstances. If we add the cost of goods derived from a historical percentage of direct costs like external faculty fees, stationery for a programme, etc. we arrive at the desired sales figure. The HRD revenues may not compete with the sale of rooms or food and beverage, but certainly makes HRD people think like entrepreneurs by exploiting their skills. Putting the formula in a simple manner the budget would look like this:

ROI Formula Plus Plus Plus Plus

Desired Net Profit (ROI) Income tax @ 30% of income before tax Income before Tax Fixed Charges (depreciation, interest, insurance, rent) Gross Operating Profit Operating expenses @ 30% Gross Profit Cost of goods @ 10% of sales Sales Room contribution @ 50%

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Historical Method Another way to arrive at desired sales figures is through an analysis of past performance. Normally, the HRD manager increases the sales by a standard 10 per cent from the previous year. This takes into account increases in operating costs and inflation.

Major Sources of Revenue in a Hotel The hotel generates revenue from various sources:

Rooms Division Rooms Rooms are the biggest source of revenue. Rooms come in various types, each with their own price range. The challenge is to maximise the yield from each room space. Business Centre This is a facility that most hotels nowadays are including in the list of facilities. Most hotels recognise the potential of revenue from the business sector and cannot overlook it. The business centre can be elementary with a secretary, office with computer and basic office automation. More sophisticated business centres can have meeting rooms, teleconferencing facilities, multi-offices, and the latest office automation. There is good potential for revenues from this facility. Health Club and Recreation This is put under the charge of the Accomodations division. This facility promises good revenue with an increasing population of health conscious travellers. Health Clubs can again be simple with a swimming pool, change rooms, and sauna facilities. Bigger health clubs would have, in addition, a gymnasium, Jacuzzis, yoga rooms, meditation centres, massage parlour, and perhaps, a range of water sports, trekking facilities, etc. Miscellaneous These Revenues can come from the sale of postage, safety deposit lockers, left luggage, and additional services provided to the room like baby-sitting, extra beds, cribs, etc.

Food and Beverage Division Restaurants A hotel may have an array of restaurants such as the coffee shop, specialty, night club, etc. that contribute to the overall F&B sales budget. Bars These outlets are where liquor is sold to the public. They may be independent or part of a restaurant or banquet operation. These are important revenue sources as their contributions are large. Banquets This is a major contributor of revenue as they make sales in volume. The contribution margin is high. Functions may be in-house or outside catering. Room Service This department creates sales by providing food and beverages to guest rooms. Pastry Shop Is a facility available to earn extra revenue when a hotel has an in-house confectionary and makes its products available for sale to the general public. Delicatessen A delicatessen is a facility that provides cooked meats for sale to the general public. The delicatessen is an opportunity for hotels that have an in-house butchery.

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HRD Consultancy Services The revenue for HRD comes from various expertises it possesses:

Training Programmes Internal training costs are apportioned to various revenue departments. These become a source of sales for the HRD department. Recruitment Services Modern hotels charge the revenue departments for the recruitment services provided by the HRD department. Counselling services HRD may charge for professional counselling services relating to performance, career, and individual growth. Assessment Centre Should HRD have an internal assessment centre facility, they can charge revenue departments for these services. Organisation consultancy The HRD department as internal consultants give valuable inputs in organisation design, work design, job evaluation, career planning, etc.

Expense Forecasts Before we venture into forecasting expenses, let us understand the broad expense categories. There are four different categories of expenses: 1. 2. 3. 4.

Fixed expenses Variable expenses Discretionary expenses Semi-variable expenses

Fixed Expenses These do not change with changes in volume. Such expenses are depreciation, interest payments, and insurance.

Variable Expenses These change proportionately with changes in volume of business. These are the costs of running training programmes such as stationery, printing, heat, light, light and power, training consumables, etc. Other variable expenses are the operating expenses. To an HRD manager, operating expenses will include:

Salaries and Wages Salaries are given to full-time employees, while wages are given to part-timers and temporary workers. Based on the company compensation package, salaries are supported by perquisites like accommodation, transportation, medical insurance, leave salary, leave tickets, pension contributions, etc. All these have to be built in this expense head. Advertising and Promotion Expenses While there are general advertising expenses for the entire hotel, there are some exclusive to HRD. Corporate advertisements are apportioned to revenue centres while HRD advertisements reflect directly in the HRD budget. HRD is concerned with job advertisements to source talent from the market.

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Stationery and Supplies These are required for daily operations. Under this head are the printing expenses for forms and formats that drive HRD operations. It would include computer accessories like CDs and printer ink. The HRD spends a lot on preparing training manuals, in-house newsletter, and internal surveys. Transportation This is an important expense head. Expenses are incurred on two counts: one for operating courtesy transport for guests and the other to pick employees from their homes to be on duty. With the increasing prices of petrol, transportation becomes a rising expense. The employee transport expenses feature in the HRD budget. Energy Costs These keep increasing year by year. The engineering department is able to apportion energy costs to all departments through a metering system. Energy cost would include power (including lighting, air conditioning, or heating for running HRD offices; and training classrooms. Repair and Maintenance Costs These are the usual costs for maintaining HRD facilities. It does not include major renovation costs as they would be a separate capital investment. Maintenance would include consumables like bulbs, furniture and fixtures, office equipment, etc. Duty Meal Expenses Though duty meals are prepared in bulk for all employees, the kitchen is able to allocate consumption to departments based on the number of employees in that department. Telecommunication Expenses The cost of external calls to suppliers and guests. Travel HRD staff may have to travel locally and outstation for recruitment. Contract Charges These charges are for hiring outsourced suppliers of services like external trainers, specialists, assessment centres, etc. External Training Programmes These are programmes that cannot be conducted internally due to their unique nature. The organisation may sponsor employees to external programmes to ‘bring-in’ the expertise learnt.

Discretionary Expenses These are short term expenses to serve a specific purpose. Such expenses would include: l l l

Major repairs Complimentary meals for promotion Special unplanned employee promotion expenses

Semi-variable Expenses These are that are partly fixed and partly variable. Incentive commissions to HRD staff are a good example. HRD staff may get a fixed monthly salary as well as a bonus for meeting performance standards. For the purpose of budgeting, semi-variable expenses are clubbed with variable expenses.

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The budget can be graphically represented as shown in Figure 3.27 below. SALES

$ 60,000 Revenue

Net Income

$ 50,000 Break-even $ 40,000

Variable Expenses

Expenses

$ 30,000 $ 20,000 $ 10,000

Fixed

$0

Expenses $ 10,000

$ 20,000

$ 30,000

$ 40,000

$ 50,000

$ 60,000

SALES VOLUME

FIGURE 3.27 | Budget Graph The HRD manager will, therefore, plan his or her budget to include fixed expenses, variable expenses, and sales. The HRD budget will look like this:

Budget Format There is no sacrosanct format for a budget. The budget must reflect the information that the management desires and can understand. It must be complete so as to interpret it for any purposes of revenue and cost. The diagram below gives a sample of an HRD budget format on an assumption that it is a revenue centre as most organisations are moving towards (see Figure 3.28). Should HRD remain a cost centre, then the sales figures are not relevant. The HRD costs then are carried as overhead costs of the organisation. The HRD Manager is also concerned with the Capital Budget. A capital budget is the planned expenditure for long-term assets like equipment, software, HRIS, classrooms, etc. The investor would have already provided for HRD offices, training classrooms, training and office equipment and employee cafeteria when the hotel was new. The HRD Manager has to consider the replacement of these capital items on an annual basis due to normal wear and tear of operations. Items that fall in the capital budget would be: 1. 2. 3. 4. 5. 6.

Training Equipment Office equipment Classrooms Renovations costs Furniture HRD hardware and software

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Budget Head

Jan

Sales Training Programmes Recruitment Services Assessment Centre Consultancy

Less: Direct Costs Stationery Travel Vendor fees Gross Profit

Operating Expenses Salaries and Wages Advertising and Promotion Stationery and Supplies Transportation Energy Repair and Maintenance Travel Duty Meals External Programmes Telecommunications Contracts Travel

Gross Operating Profit

FIGURE 3.28 | HRD Budget Format

Feb

Mar Apr

May

Jun

Jul Aug Sep

Oct Nov

Dec

Annual Budget

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Summary The HRD function has become a strategic arm of the organisation because it deals with the most important asset—people. HRD aligns human resources, thinking, and activity to frequently changing organisation goals as it responds to its strategic intent. It does this through several processes including plans, objectives, and structures. It brings about cost-effectiveness using staffing norms, using considerable creativity in parrying staffing challenges. An important part of HRD planning is to define job content to meet organisational objectives. This it done through job analysis which has significant influence on other HRD processes. Its immediate value is to develop job descriptions that profile the jobs, and job specifications that profile the job holders. It is used to restructure jobs through work design to enlarge or enrich them as organisations work towards offering meaningful roles to an emerging kind of employee—the knowledge worker. All these activities are driven by a financial outlay called the HRD budget. Many organisations are seizing opportunities within the organisation, and external to it, to make HRD a revenue centre using the expertise of its HRD people.

Key Terms Plan Mission Objective Organisation Structure Organisation Chart Employee turnover Intranet Vision Values Belief Strategy Diversification Stakeholders Environment De-layering

A blueprint of future action An overriding purpose of being in business A measurable end-goal A framework that establishes job relationships and communication channels. A graphic representation of the organisation structure The rates at which employees leave an organisation Internal computer network An ideal and unique image of the organisation’s future Fundamental beliefs and guiding principles that shape the culture of an organisation A conviction that something is true A long-term direction Moving into unrelated businesses People who are influenced or influence an organisation The internal and external influences on an organisation Reducing the number of hierarchical levels in an organisation (Contd.)

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Key Terms (Contd.)

Policies Productivity Delegation Job Job Enlargement Job Enrichment Job Analysis Job Description Job Specification Mission Statement Key Result Area Job Title Job Designation HRIS Budget Revenue Forecasts Fixed Expenses Variable Expenses Capital Budget Discretionary Expenditure Semi-variable Expenses

Broad formal guidelines for future action Output within a given time The allocation of higher responsibilities to a subordinate while holding the accountability A paid individual performance that contributes to the organisational goals Adding more responsibilities in relation to the job Adding higher responsibilities A scientific study of the components of the job and required profile of the job holder Profile of a job Profile of a job holder A generalised statement about the overriding purpose of the business A focussed activity that promises to deliver results Public name given to a job position Room name for a job position to establish internal parity Human Resource Information System A plan of revenue and expenditure Desired sales required Expenses that do not change with volume Expenses that proportionately change with volume Planned expenditure on long-term assets Short-term expenditure for specific purposes Expenses are those that are partly fixed and partly variable.

Review Quiz Short Notes 1. What is the importance of human resource planning? 2. Write short notes on the following: (a) Vision (b) Mission (c) Values 3. Explain the different types of organisation structures 4. Explain in detail, the various phases of HRD planning. (Contd.)

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Review Quiz (Contd.)

5. Explain how HRD responds to the following key result areas: (a) Growth (b) Survival (c) Managerial Productivity 6. Explain in detail the job responsibilities and job specifications of the following: (a) HRD Manager (b) HRD Information Assistant (c) Recruitment and Selection Specialist 7. What are the benefits of Work Design? 8. Explain the components of an HRD budget and detail the budget layout. 9. Case Study: Hotel Plaza is a 200 room airport hotel in a major metro. The features and facilities are as follows: (i) Four floors of two wings each of 25 rooms (ii) A coffee shop of 150 cover capacity (iii) A specialty restaurant serving Indian food with a 50 cover capacity (iv) 24-hour room service (v) 24-hour laundry (vi) One function room for local events (vii) A swimming pool with barbeque facility beside the pool (viii) A small unisex gym with separate massaging facilities for men and women (ix) Runs at 90 per cent occupancy throughout the year (x) Large landscaped gardens Staff this hotel maintaining a 1:2 ratio giving detailed explanations to your staffing considerations.

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4 Hospitality Recruitment and Selection 1. INTRODUCTION First let us understand the meaning of the two terms—“recruitment” and “selection.” Recruitment is the process of identifying suitable candidates from known sources in the market for a job. Selection is the process of choosing from the candidates identified. The term “hiring” is a composite of these two functions. The greatest challenge facing the hospitality industry is finding human resource’s with the right skills and competencies. Finding the right people is imperative since people are the backbone of the industry. Properties compare equally in terms of architecture, décor, and product offer in the same price range and market segment. The employees, however, create the cutting edge over competition with their standards of service. It is universally acknowledged that the employees in a service-oriented industry make the difference between a good or bad experience. Readers may claim that the labour market is full of people. Then why should the human resources pose a challenge? The truth is that it is not the numbers of people in the market, but the availability of the right people. In many parts of the world like Europe, North America, and Japan, the birth rates have fallen and are not keeping pace with replacement requirements. Numbers in those countries are a problem where demand is more than supply. In regions with large working populations like South Asia, South America, and Africa, the shortage lies in qualified personnel and not in numbers. The hospitality sector also has the challenge to attract the best talent of the society into the industry since most talents opt for traditional careers in engineering, medicine, and business management. Though there is an appreciable shift towards the service sector, getting the right people is still a challenge. In Chapter 3, we profiled the knowledge, skills, and competencies required of a Front Office Receptionist. Finding people with those competencies is not easy because very few people have the flair and desire to serve others and enjoy it. Skills may be taught, but attitude is inborn in any individual. It requires professional human resource practices to get the right people for the right job, and thereafter maintain them at a high level of motivation to serve the guest well. Hotels vie to get the few talents available, thereby skewing salary scales within the organisation and creating ill-will among competitors.

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Pre-recruitment Activity The process of recruitment starts with preparing a job description that profiles the duties and responsibilities of a job. We have seen in the previous chapter how job analysis leads us to profiling the job (job description) and the job holder (job specification). Recruitment and selection can only be done against specifications set for a job. The process is explained below in Figure 4.1.

Job Analysis

Task Lists

Job Descriptions

Job Specification

FIGURE 4.1 | Pre-recruitment Task Flow These have been discussed in detail in the previous chapter. Once this is in place, each organisation will like to enunciate recruitment policies to guide the recruiters.

2. RECRUITMENT POLICIES The policies are agreed upon by the owner and/or the top management. They are, however, created by the HRD manager in the first place as he/she is part of the strategic planning teams and knows what policies are required to configure the employees towards the strategic objectives. Therefore, while policies stand for long periods of time, they are changed to suit the evolving strategic scenarios. Recruitment policies impact the following: l l l l

Cost to the company Attracting and retaining good talent Speed in filling vacancies Organisation culture

Given below are some of the recruitment issues that need policies because they have repercussions on the business. These policies should be available in writing to all the decision-makers so that they are guided by them when hiring people for the organisation.

1. Internal vs. External Recruitment This is a formidable issue that needs a policy. Organisations believe that strong internal growth supported by career and succession plans motivates the employees to stay with the organisation longer. They also believe that people are committed when their individual growth is linked up with organisational growth. ITC Hotels Division believes that ‘the best form of growth comes from within’. While this policy has its virtues, there are several drawbacks when deciding upon it. The advantages and disadvantages of internal and external recruitment are discussed in detail later.

2. Impact on Compensation Policy Any recruitment has an impact on compensation policy. While progressive organisations keep their compensation in step with the market developments, there are organisations that lag behind. Hiring good

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talent from outside often upsets existing compensation policies because the worth of good talent follows market dynamics. Organisations that do not maintain parity with the market in compensation may be forced to hire less than the best talent. This issue is guided by the recruitment policy.

3. Entry-level vs. Experienced Some organisations believe in feeding job positions in the organisation at entry levels and give new recruits a career growth within the organisation. This policy is cost-effective and promotes good morale in the organisation. People selected at entry levels are from colleges/hotel schools. When recruiting graduates, their potential for higher responsibilities is a major consideration. While good selection processes identify potential, there are some who reach their level of maximum potential early and become ‘extra baggage’ to the organisation if they unable to grow further. There is also the issue of changing business strategies, products, and services. The concern is whether those selected are able to adapt to new changes. Organisations may be forced to hire from the market at that stage, creating resistance from insiders. A policy to hire experienced people from the market at all times poses the problem of culture fit. They will try to influence the organisation with their own experience and practices. Organisations may welcome such people to infuse new ideas into the organisation, but existing employees may resist the person and his/her ideas.

4. Outsourcing vs. In-house Some organisations are proud to have captive facilities like a butchery, laundry, beauty parlour, etc. It becomes a matter of prestige. The new service age, however, has thrown up several excellent specialised services that are cost effective and remove several hassles of running operations from within. Take for instance the hotel butchery. Why should a hotel maintain a butchery at a cost (including the labour cost) when they can get precut portions of meat from the market at a lesser cost? The cost of running an in-house laundry is also prohibitive. Yet hotels have in-house laundries when this activity can be outsourced to a nearby laundry. Future policies in the hospitality sector are in favour of outsourcing.

5. Human vs. Technology The hospitality business recognises that people give personalised service. The quality of service is the cutting edge over competition. The belief is that technology should only improve efficiency of the people. While this policy has its merits, technology has reached new boundaries, especially in processing information. Soon we find that technology is replacing human beings in the backoffices that processed information. Middle managements who did mainly processing work earlier have suddenly disappeared. We will see more hotels in future replacing people who do information processing with technology. Future developments will soon see more technology being used. For example, guests will be able to access and pay their bills through in-house ATMs. Guests will be able to check-in to a hotel with ATM like machines which will require a reservation confirmation number to discharge a room key through a slot. Recruitment policies will have to take into account those jobs that require ‘warm bodies’ to give personalised attention and those to be replaced with technology.

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6. Specialists vs. Generalists There are jobs which are branded as specialist jobs and those in which skills are easily transferable. A reservationist can easily handle the reception just as the waiter can be used in any type of restaurant, banquets, or room service. While most hotel jobs have a certain degree of multi-skill, there are some that are considered specialist positions where skills are not easily transferred as they require special qualifications which are sometimes rare to find. Jobs like a chef for a specialty cuisine, IT programmers, financial analysts, or telecommunications engineers may be considered specialists. Such positions should be identified and listed, which leads to the issue of compensating them. Some specialists are not easily fitted into the usual compensation parameters of a hotel. Their compensation is dictated by the market. So, when the recruiter goes out into the market he/she should be able to offer the market price for the specialist. However, there is a lot of heartburn among other employees when they see specialists getting more than them. A policy needs to be enunciated as to how to deal with specialists.

7. Sourcing Policy Organisations also stipulate a sourcing policy, i.e. from where the recruiters should get their candidates. Such a policy considers several factors such as cost, social responsibilities, the law, the quality of human resources, etc. For example, some hotels may not use recruitment agents as a policy because of their high cost. Others may source internally only as a policy to ensure cost efficiency. Many hotels, on the other hand, may frown on hiring relatives of existing employees. Others may want to exploit the hotel management schools as sources of regular employment. Such sourcing decisions are largely based on the reliability, cost-efficiency, and availability of human resources from those sources. Only experience and analysis tells the right sources.

8. Recruitment Authority Levels A recruitment policy will state who will approve the various levels of staff being hired. Small organisations may insist that all employees are approved by the owner. Larger organisations may not have that luxury. They, therefore, set levels of authority for recruitment. For example, heads of departments like the Food and Beverage Manager, Front Office Manager or the Executive Housekeeper may have the authority to appoint skilled levels provided they are within the sanctioned strength. The General Manager may have to approve the hiring of supervisors and junior management, while the Board of Directors may approve all senior appointments. All levels must pass through HRD manager who acts as the consultant to the authority. Such a policy must be clearly articulated.

9. Recruitment Budget Organisations set limits to recruitment costs that are part of the HR budget. Recruiters have to balance their sources of recruitment to keep within budget. There should be a policy as to what the HR department should do if they exceed the recruitment budget. There are approval levels for such excesses that need to be articulated as policy.

10. Retain or Release There must be a policy regarding existing employees who want to leave the organisation for better pay. The organisation has to weigh the option of increasing pay to save recruitment costs, or to release the employee

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and incur that cost. A cost analysis may be a simple way out to decide on the matter, but there are broader ramifications. Organisations do not want to release employees in whom they have invested by way of training, so that only they could be gainfully employed by the competition. Hotels must have a retention policy to safeguard against good talent leaving the organisation. Such policies are supported by career plans, succession plans, empowerment, job enrichment, job enlargement, flexible compensation policy, etc.

11. Employment Conditions Recruitment is guided by the compensation structure. Organisations may decide to get the best talent in the market by being the best pay masters in the industry. Others may want to maintain parity with the industry, while still others may want to pay the least. Each policy has an influence on the type of talent that will enter the organisation. Such decisions are based on the standards the organisation wishes to maintain. Then there are intangible benefits like career plans, meaningful job roles, and a professional culture that attracts talent and offsets compensation.

3. SOURCES OF HUMAN RESOURCES SUPPLY IN THE HOSPITALITY INDUSTRY Sourcing is the process of identifying qualified human resources from the market. There are two generic sources from where human resources may be procured. They are internal sources and external sources. Internal sources are within an organisation while external sources are those outside an organisation. Let’s look at each source.

Internal Sources Promotions When a job vacancy occurs, the best source to fill the position is from within the organisation, by promoting someone who is junior and ready to take the higher position. Organisations have career development programmes and succession plans as a way to fill positions from their existing staff itself. This gives employees growth and a tremendous motivation to stay with an organisation. Motivational studies have shown that growth and advancement are strong motivators. While growth refers to any increase in knowledge and skills, advancement is the movement up in the career ladder. Flatter organisation structures find it a challenge to provide advancement. However, this is managed by job enlargement, which is the expansion of the job role by adding more duties, and job enrichment, which is the quality of tasks added, such as some managerial tasks added to a server’s job supported by higher compensation.

Lateral Transfers These are transfers of existing employees who are either doing similar jobs in another section or branch of the organisation, or are from another unrelated department in the organisation, as part of a larger individual development plan. An example of this would be a telephone operator who wishes to progress to front-desk duties, or a counter staff at delicatessen who feels confident with customer interface and can move to the front office. These are the quickest ways to fill vacancies without having to induct a new person into the cultural style of the organisation. This source becomes especially important in filling critical posts immediately.

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Networking with Employees This is a cost effective way to fill a post by asking existing employees to recommend friends, relatives, or past associates to fill the post. The benefit of this is that the employee feels secure to bring in a friend and will cooperate fully to make that person productive soon. The disadvantage is that it leads to groupism. Camps develop that can work for or against the organisation. For example, a leading luxury hotel had recruited a specialist chef for a unique cuisine of which he was a master. They left it to him to select his team of cooks from the external market as the cuisine was unique. Once, when he was unhappy with the management, he snapped his fingers and led his entire team out of the kitchen. The team had their loyalty to the chef and not to the organisation. Such can be the consequences of groupism and loyalty of individuals. In the west, there are severe chances of litigation due to this strategy because of not providing equal opportunity in the market.

Talent Bank A talent bank is an inventory of “drop-in” eligible candidates during the year. Job seekers keep applying to an organisation even though the organisation has no vacancy and has not advertised for a post. Such drop-in applicants can be interviewed and, if found suitable, can be kept on a waiting list in the Talent Bank which is a filing cabinet with such applications and résumés. (Soft-copies of CVs are kept in internal databases nowadays). These applications have to be updated periodically for the availability of candidates who could have taken another job over time. Most organisations review these talent banks every six months by contacting the candidates and asking them if they are still available. This is another cost effective method as it saves the costs of advertising or paying a recruitment agency. The advantages of this strategy are: 1. 2. 3. 4.

It is very cost effective. It enlists those candidates who have shown a real interest in the organisation. Interviews can be spaced out during the year. It is the quickest way to access an eligible résumé.

The disadvantages are: 1. Candidates may have got alternate employment by the time a vacancy arises. 2. The databank needs to be constantly updated. 3. Candidates could lose interest in the organisation over time.

Job Postings These are announcements of vacancies on employee notice boards. Many organisations prefer to give opportunity first to their employees to apply for a vacancy. There are those who may get a rise in their career while others who may want the advertised job as their preferred career choice to the one they are presently doing. These postings are done on the employee notice board located in the human resource department.

Cross-Training It is the training of employees in other related job positions. The hospitality industry has set the lead in cross-training giving managements the flexibility to deploy workers in different departments when the need arises. It also gives an employee an

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appreciation of other jobs when they coordinate with them. A progressive organisation would rotate new recruits through various functions to give them an appreciation for other positions, develop additional skills, and have the flexibility to exercise them.

Internships Establishments, who anticipate a high turnover of staff due to competitive environments, conduct induction training of raw recruits as a way to keep the supply of trained human resources to the organisation through apprenticeship, internship, and management training programmes.

External Sources Recruitment Agencies They are the most popular external source from which recruitment can be done. Recruitment agencies keep applications in their talent banks. They are able to produce lists of interested candidates immediately. The organisation pays the agency a fee, for this service which is either fifteen days or a full month’s gross salary of each employee selected. Sometimes, they work on a percentage of the annual gross salary (about 10–15 per cent) which comes to approximately a month’s salary. The benefits of this source are numerous and it is useful in a number of situations: 1. The recruitment agent conducts the preliminary interviews to save time for the appointing organisation and is able to produce a number of relevant applications. 2. Provides resorces immediately when positions have to be filled in quickly. 3. Provide suitable human resources when the organisation is unable to build a pool of qualified applicants on its own. 4. Provide suitable human resources when the organisation is not equipped to conduct a professional recruitment search. 5. Provide suitable human resources when specialists are required. 6. Provide suitable human resources when the organisation diversifies into new businesses that they have little knowledge of. 7. Provide suitable human resources when they want to keep the identity of the organisation confidential till the final stage. 8. Some of them specialise in an industry and are able to target the right people. 9. They can act as outsourced recruiting partners reducing the need to maintain a recruitment team inhouse. The disadvantages of recruitment agents are: 1. They are expensive. 2. Research has to be done to find a reliable one that specialises in the hospitality industry. 3. They are interested in managerial positions more than inline staff as they get better fees for them. 4. Most of them insist on a contract precluding the organisation from going elsewhere to find candidates. In selecting recruitment agencies the following criteria are recommended: 1. The agency should preferably specialise in the hospitality industry. 2. The fees to the agency is paid only when the individual(s) is on board.

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3. The agency does the initial screening and does not just blindly send résumés. 4. The agency provides a placement guarantee for 30, 60, or 90 days, when they replace a candidate not found suitable or who leaves, at no extra cost during the guarantee period. 5. There should be a proper contract drawn and signed by both parties explaining clearly the period of recruitment and the positions sought. The contract ceases when the conditions are over. 6. The agency does not charge the candidate. It limits the search. 7. The agency should be able to provide references from clients and candidates who have used their services in the past. 8. The agency keeps the information of the organisation confidential especially from competitors. A good source for identifying qualified recruitment agents worldwide is www.recruiterlink.com that has a database of 400 executive recruitment firms, from ‘boutique’ firms to international agencies.

Hotel Management and Craft Schools They are wonderful sources to recruit from as the students have already made career choices for the hospitality industry and are specifically educated and trained for it. Such institutes hold campus placement activity when students complete their education by inviting the industry to conduct their interviews and selections. The hotel will advertise the positions on the campus notice board through the placement coordinator who will receive the résumés of all interested students. The organisation has the opportunity to present itself and field any questions before the selection process starts. The advantages of this recruitment strategy are: 1. 2. 3. 4. 5. 6.

It targets the right industry profile. It is cost effective (in local schools). The students come at entry levels and are cheaper. They come with the latest developments and research in the industry. They require a lesser induction time than someone fresh to the industry. Students recruited become ambassadors of the organisation to future batches of students.

The disadvantages are: 1. 2. 3. 4. 5. 6. 7.

They are only suitable for entry level jobs. Their skills levels are basic and need further induction time in the organisation. The entire industry is vying for the same pool of students. The ‘early bird’ recruiter gets the best of the crop. They are available only at certain times of the year. Some schools may lag behind latest developments in the industry. Some students may refuse confirmed offers when they get a better one, thus skewing recruitment plans. 8. Students prefer to join large properties as they see better careers, leaving smaller establishments empty handed. 9. Outstation campus recruitment can become expensive. One way to ensure a better contact with students is to provide them internship opportunities as part of their mandatory curriculum requirement. The organisation benefits by making sneak previews of suitable candidates for permanent employment. The students will also ‘spread the gospel’ of the organisation to other students upon their return from internship.

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Employment Agencies These are public agencies, run by the government of each country, to provide the unemployed population a common forum to get jobs. They keep applications of candidates for government run institutions.

Colleges These are colleges other than the Hotel Schools. Students want to work to meet tuition fees and personal expenses. The best place for most of them is the service industry where basic skills can be learnt quickly. Many opt for careers in the hospitality industry as an afterthought. They will need extensive training to develop skills from the basic to the advanced.

Headhunting from Competition The term “headhunting” refers to identifying specific talent and approaching them for employment. An alert recruiter keeps an eye out for good talent in other organisations. He would approach them discreetly to join up with a competing salary offer. Head hunting is also done by agencies to maintain confidentiality and avoid ill will with competitors.

Job Advertisements These are job announcements in the media. This is used most often in the newspapers, trade magazines, or appropriate media. This is an expensive proposition as media space is costly, but has the advantage of receiving applications directly without having to pay a fee to a recruiting agency. Job advertisements are preferred when there are substantial volume of candidates to be recruited. The advantage of job advertisements is that it acts as a publicity campaign for the company itself. The company logo is flashed in media that keeps the company presence fresh in the minds of customers. A great disadvantage is its cost which is prohibitive. The other problem is the text that is written. Recruiters have to be very careful, especially in the west, to not bar anyone on the equal opportunity issue. Any discrimination can lead to lawsuits. Small restaurants may post a vacancy on their shop window to attract job seekers passing by.

Professional Journals This is the most appropriate medium to reach the right target market for talent. Trade journals are read by professionals of the trade and serve as an active place for job seekers and job recruiters.

Job Fairs This is a relatively new concept bringing together recruiters to put up stalls either in a college campus or a common ground. Job seekers can contact several recruiters under one roof. The benefit of such fairs is that it attracts potential talent at one place. The disadvantage is the cost of setting up a stall along with head-to-head competition with the competitors.

The Internet The internet has grown to become a new cost-effective source of recruitment. First are the company websites that post job vacancies. Résumés are received on-line at no cost at all. Then,. there are the employment sites such as www.Naukri.com or www.Monster.com that display résumés by the thousands to choose from. In the

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US the E-Span Interactive Employment Network provides a résumé database that is accessible from several online service providers.

Non-traditional Sources There are situations when hotels and restaurants, especially in small towns and resorts, may not have access to traditional sources of human resource supply, as mentioned above. City-bred talent may not want to move to smaller towns. In such cases there are other sources, which can be considered and developed:

Part-timers They are a floating workforce who are called to work at peak operational times. They are paid on an hourly basis. They could possibly be people doing a second job to earn extra money.

Housewives They are a very good source to fill job vacancies. Often women are well qualified but are restricted in a career due to child rearing. Once children grow to go to school, these women can be available for jobs in the mornings when children are at school.

College Students They are a very big source of additional hands as they either want to earn extra money or want to get experience as in the case of hotel school students. They are paid on an hourly basis.

Handicapped People This is a good source, especially for backhouse jobs. For example, a telephone operator, secretary, accounts clerk, etc. can be wheelchair bound to be able to do a good job. Western nations are encouraging handicapped people to become part of the mainstream workforce. They provide special ramps for wheelchairs, lower door handles, elevator buttons, special toilet facilities, etc. to make it easy for the handicapped. This movement will increase over the years as a measure of harnessing potential good talent.

Retired People Organisations, due to dated policies, retire people especially when they are at the peak of their knowledge and experience. With people working hard to keep fit, retired people are still productive during their middle age. Many societies have extended the retirement age from 58 years to 65 years. Retired people can be excellent alternative sources when talent is scarce.

Management Companies The new age has sprung specialists in every field. It becomes sometimes more economical to outsource some functions of the human resources, accounting, legal, etc. operations to management companies who have larger resources and technical expertise to tap.

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Advantages and Disadvantages of Internal and External Recruitment There are several major advantages of internal recruitment: 1. It is considerably less costly (if not negligible) than recruiting from external sources. 2. Organisations know internal candidates better to be able to motivate them. External candidates are unknown entities that will take time to really understand. 3. Internal candidates are familiar with the organisation’s culture, systems, and processes. External candidates will take time to reach that level of understanding. 4. The workforce is motivated when they know that promotions are from within. They have the comfort that they will be considered first for higher positions before any attempt is made of external recruitment. Many organisations have well developed career plans and succession plans that give internal candidates the first choice. 5. Studies have shown that internal recruitment brings better stability and financial success to the organisation. The disadvantages in internal recruitment are: 1. The organisation becomes insular and resists change. Internal recruit propagates old ways leaving little room for fresh ideas. 2. When organisations bring in new business strategies with new skill sets then internal candidates are unlikely to fulfil the competencies needed for the new change. 3. Internal candidates have a sense of fierce ownership of the company and will resist any new person from joining the ranks. There will be initial attempts to oust the external candidate. 4. Some entrenched managers become obsolete to new changes in doing things. They become a burden to owners who want change. They will go out of their way to resist change. 5. Good internal candidates are always fought for by competing departments, divisions, and business of the organisation. There is political twisting to get good candidates resulting in ill will among senior managers. On the other hand, it is difficult to get rid of poor performers because of the protection they receive. 6. Internal candidates have their ‘godfathers’ in the company who fight for advancement even though the employee is average. Another side is the camps that develop by ‘warring’ departments and senior executives that do not allow the meritorious to progress. Such politics can be counter-productive to the organisation. 7. Many employees exemplify the Peter Principle when they reach a level of incompetence. The organisation is forced to put them in higher responsibilities because of announced succession policies. They have to carry the cost of their incompetence. This is often found in government hotels and some proprietary concerns where a candidate is retained for his loyalty towards the company for many years. The advantages of external recruitment are: 1. The greatest advantage of external recruitment is the infusion fresh blood. New entrants can look at systems and processes with fresh eyes and introduce new ways of doing things. Modern organisations believe in keeping a young workforce, easing out those who are above 35 years. The strategy is to bring in the latest concepts and skills by recruiting youth fresh out of university.

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2. Some organisations deliberately recruit external candidates from the competition to learn and introduce some of their successful strategies. Furthermore, those in sales and marketing of the competition bring their clients and contacts for the organisation to approach. 3. External recruitment is especially useful when new products and services are introduced. Such skill sets and competencies are not available within the organisation and will have to be got from the external market. The time taken to do this is lesser than having to train insiders into new skill sets. For example, ITC Ltd., which was traditionally a tobacco business, had to recruit most of their hotel talent from external sources when they introduced Welcomgroup, their hotel’s division, as part of their change in business strategy. 4. External recruitment is useful when the owners want to professionalise their operations and culture to adopt modern ways. For example, the Oberois who were successful in their style of hoteliering recruited MBAs from reputed business schools to infuse modern management into the organisation, once they went in franchise with the Intercontinental hotels. Following are the several disadvantages of external recruitment: 1. External recruitment severely demoralises the existing workforce which suddenly feels threatened. There is resistance to newcomers who have to deal with this for a while till their performance and actions gain them acceptance. 2. External recruits take a longer time to learn the ways of the organisation. It may take several months before they are fully in sync with the organisation’s processes. 3. External recruitment is very costly. Advertisement costs or recruitment agency fees are prohibitively expensive. Organisations have tried to circumvent these costs by posting vacancies on their websites. 4. There is a lead-time required to get an external candidate on board from the time the vacancy is announced to the time the person joins. It takes on an average two months. Most of the time is taken by the notice period that a new employee has to serve with his/her present company. While the average notice period is one month, senior appointments may require as much as three months notice period. 5. External candidates are an unknown entity. In spite of the best assessment and selection systems employed, there is always an unknown aspect to an external candidate. It is for this reason that an organisation relies on reference letters to narrow the unknown. 6. There is bound to be a clash between new and the old ways of doing things when an external candidate brings in new ways of doing things. Both outlooks jostle for power till one succeeds, but only after a lot of discomfort. The new employee is disillusioned and disappointed if his or her way is rejected.

Evaluating Recruitment Sources An important step for an HRD Manager is to evaluate the success of various recruitment activities. Obviously, they would desire the most effective one with the least cost. Some of the criteria used in evaluation are: 1. Measuring the lead time to fill a vacancy: Lead-time, as discussed earlier, is the time between the announcement of a vacancy and the time it is filled. Organisations prefer the least lead time. This is critical in the hospitality industry that relies on ‘warm bodies’ to be present to give service. 2. Retention rate: This evaluates how long an employee from a particular source remains with the organisation. Every hotel wants a new recruit to serve long because of the cost of recruitment, cost

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3.

4. 5. 6.

of training and inducting him into the organisation, and the cost of business loss because of a resignation. Quality of resource: Some sources throw up better quality of human resources than others. An organisation would like to get the best people available because the human resource, as we know by now, makes the difference. Cost per hire: This is a major criterion. An organisation would like to keep its recruitment costs to a minimum and will evaluate the HR Manager on the basis of cost reductions shown here. Number of applicants generated: A recruiter would like that source that will give him/her the maximum choices. A source that is able to generate large options becomes preferable. Job Performance: A way to evaluate a source is to see the performance of candidates from the source. A source that throws up better performers is more desirable.

4. SELECTION PROCESSES Selection is the process of choosing from the eligible human resources identified in the recruitment drive. Personnel selection is vital to the hiring process, and ultimately, in organisational effectiveness. The selection process aims to choose the eligible candidates closest to the specifications meticulously identified as part of the job analysis process. The selection process must also dovetail with the company’s mission and objectives. For example, the mission of Marriot Corporation is to be the hotel chain of choice for the frequent traveller. Their selection systems give particular attention to identifying people who can anticipate and satisfy customer needs. A challenge in selection processes is to identify those who show potential to perform and deliver results as desired. These are not as obvious as academic certifications or history of employment. Potential is amorphous and has to be drawn out by clever selection processes. There are several components in the hiring process as illustrated below in Figure 4.2. The selection phase is shaded: Job Analysis

Job Description

Job Specification

Sourcing

Interviewing

Testing

Contacting

Screening

Offer Letter

Reference Check

Appointment Letter

Joining Formalities

FIGURE 4.2 | The Hiring Process

Job Analysis, Job Descriptions, Job Specifications, and Sourcing These have been discussed in detail earlier. The sources of supply would have produced a number of respondents with résumés, biodata, or curriculum vitae (which mean the same). Let us look at the other components of the hiring process.

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Screening Screening is the process of matching the candidate’s résumés with the job specifications of the position. The illustration below is self-explanatory (see Figure. 4.3). Match Job Specification

Candidate’s Résumé

Shortlist

Contact

FIGURE 4.3 | The Screening Process

Contacting Contact is getting in touch with shortlisted candidates about the time, date, and venue of the interview or test. Such contact can be made by phone, e-mail, or letter. A written contact keeps a record in case of litigation (especially in government and public undertaking jobs). Some establishments mention the name and/or the job title of the interviewer(s). Another important aspect of contact is with the rejected candidates. The common courtesy of an organisation is to inform rejected candidates. This not only promotes a professional image but also saves having to attend to inconvenient phone calls from candidates who want to know the status of their applications.

Testing Testing is a way to ensure that a candidate has the knowledge, skills, and aptitude for the job. There are various ways to test candidates.

Technical Skill Tests (or Work Samples) These evaluate skills. A cook may be asked to prepare a four-course menu, a server to lay out a table cover, a room service order taker to do a voice test, or a secretary a typing test. However, there are mechanical paperand-pencil tests such as the Bennet Mechanical Comprehension Test (BMCT) which consists of pictures of mechanical situations where the respondent describes relationships between physical forces and mechanical issues. The BMCT is particularly effective in the prediction of success in mechanically oriented jobs like those in hotel engineering, kitchens, and housekeeping.

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Job Knowledge Tests These tests measurers bodies of knowledge (often technical) required in a job. These are samples of what is required in the job. Therefore, a front office receptionist can be tested on the typical systems and procedures of front office operations or the Fidelio computerised system. These tests are questionnaires in multiplechoice format or essay type. Knowledge tests are very valid and can be depended upon.

Cognitive Tests These are frequently used paper-and-pencil or computerised tests. These tests measure mental, clerical, mechanical, or sensory capabilities. Examples of these are the Scholastic Aptitude Test (SAT) and General Mental Ability Test (GMAT) which were developed to measure ability to master college-level material. Each organisation can develop their own cognitive tests for skilled, supervisory, or management levels. They are meant to measure a person’s aptitude or mental capacity to gain and retain knowledge from various learning sources. Cognitive or aptitude tests are used to predict future performance. There are number of cognitive tests for commercial use. Some notable ones are the Wechsler Adult Intelligence Scale and the Wonderlic Personnel Test.

Achievement Tests These are different from cognitive tests in that they evaluate knowledge already attained. They measure the effects of knowledge obtained from a common environment. So a candidate can be tested on what he/she has learned in his/her hotel school. They also predict future performance.

Biographical Information These tests measures a variety of non-cognitive skills and personal characteristics, e.g. achievement orientation, dependability, loyalty, etc. with questions about education, training, work experience, and interests.

Situational Judgment Tests These tests measure a variety of non-cognitive skills by presenting individuals with short scenarios or cases, either in writing or video and assess the response of the individual in terms of its effectiveness.

Integrity Tests These tests measure attitude and experience related to a person’s honesty, dependability, trustworthiness, and reliability. These tests are formatted in multiple-choice or true or false questionnaires.

Group Discussions These discussions ascertain leadership and team qualities. Groups of no larger than fifteen candidates are given a topic to discuss. They are evaluated not only on the content of their contributions, but also the way they relate to each other.

Extempore Speaking Extempore speaking evaluates oral communication and stress. The stress is created by making the candidate pick a topic from a bowl and speak instantly. Topics can be deliberately vague to create the pressure. In stress situations, even a simple topic can be daunting.

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Aptitude Tests These tests assess verbal, numerate, and conceptual abilities. An aptitude test also can test general knowledge. Aptitude Tests reflect the hierarchical structure of a candidate’s intelligence in relation to an average worker. Aptitude tests are composed of numerical, verbal, and spatial ability scales brought together as a test battery (questionnaire). They can then be scored and interpreted individually as a specific ability or aptitude measure, or together as part of a general ability measure. You cannot bluff these tests. Aptitude tests are only one of the inputs of a selection process. They are never an end in themselves. They actually measure a candidate’s abilities and talents in the four criteria mentioned above. So an accountant must be high in numeric ability; a salesperson good at verbal ability; while an ad-man must be good at spatial (conceptual) ability. Aptitude tests are usually administered at entry level jobs and trainee positions.

Physical Aptitude Tests These tests check out physical ability. A banquet server may be asked to carry a stack of twelve banquet chairs; kitchen steward carry a gas cylinder over his shoulder, or a busboy a tray of crockery. There are paper-and-pencil tests too that measure physical, psychomotor, and sensory abilities. l

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Physical tests are designed to assess a candidate’s muscular strength, movement quality, and cardiovascular endurance. Basically, they are linked to the probability of accidents and injuries when doing physical work on the job. Psychomotor tests assess processes such as eye-hand coordination, arm hand steadiness, and manual dexterity. Potential waiters who carry heavy loads on a tray can be administered this test as they carry precious assets of the property like crockery and glassware. Sensory tests are designed to assess the extent to which an applicant can detect and recognise differences in the environment. Security personnel as well as housekeepers can be administered this test. They should be able to detect changes in the environment that require attention. A simpler test in the sensory/ perceptual category is to present a tray of covered objects. Candidates are given a fleeting look at the objects in the tray and are required to list the items in the tray.

Case Studies Case Studies ascertain problem solving skills and attitude. A case study is a written account of a real life problem, which needs to be resolved. A group is given the case study to discuss and find solutions. This is often used for supervisory and management positions.

Psychological Tests (or Personality/Motivational Tests) These are being emphasised upon nowadays. Personality/Motivational Tests work on the belief that performance is a function of ability and motivation. Cognitive tests do not bring out anything on motivation. Personality tests are of two types: self-report inventories and projective tests. l

The self-report tests like the Myers Briggs Type Indicator, Firo B, Caliper Profile, Circumplex, and PF 16 accurately profile the person in terms of his or her attitudes and personality. They tell whether a person is suitable for the industry and job. We must remember that skills can be developed, but right attitudes are difficult to find. Personality is a person’s consistent behaviour. Behaviour is a result of psychological traits. Many tests confine themselves to a five factor model:

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Introversion/extroversion (level of sociability) Emotional stability Agreeableness/friendliness Conscientiousness Openness to experience (curious, imaginative, risk-taking, etc.).

Some new tests are Emotional Intelligence (EI) and Core Self Evaluations (CSE). EI is a set of abilities that enable individuals to recognise and understand their own emotions and those of others in order to guide their thinking and behaviour to help them cope with the environment. It has revealed an average validity (discussed later) of 0.23 in the prediction of performance. CSE uses four heavily researched traits: 1. 2. 3. 4. l

Self esteem (how one views oneself) Self-efficacy (how well one can perform across situations) Neuroticism (the tendency to focus on the negative) Locus of control (the extent to which a person has control over life’s events).

The core self-evaluation is an assessment of one’s capability and potential. Among the projective tests there is the famous Rorschach Inkblot Test which presents a series of inkblots to respondents who must then record what they see in each one. Another is the Miner Sentence Completion Scale (MSCS) where the respondents are required to complete sentences in seven areas: 1. 2. 3. 4. 5. 6. 7.

Ability to deal with authority figures Dealing with competitive games Handling competitive situations Assertiveness Motivation to direct others Motivation to stand out in a group The desire to perform day-to-day tasks.

It is especially successful in employment settings aimed to measure a manager’s motivation to manage others. Another famous projective test is the Thematic Apperception Test (TAT) which depicts a series of pictures of one or more people in various situations. The interpreter then evaluates the outcome of each situation. Graphology (or handwriting analysis) is another projective means of assessing personality. This test is just another indicator and not entirely reliable. No two graphologists would agree on performance related outcomes.

Assessment Centres These centres measure knowledge, skills, and attitudes through a series of exercises that reflect job content and types of problems faced on the job, cognitive ability tests, personality inventories, and/or job knowledge tests. The assessment centre will use a number of methods and tools, especially those directly related to the jobs by trained assessors. Most organisations use assessment centres for supervisory and managerial positions. (see “Assessment Centres” in Chapter 10 for more details)

Medical Tests These tests have become very important to organisations who want to recruit healthy individuals to perform their jobs on a regular basis. The main aim is to find a fit candidate. The second important concern is not to

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‘import’ diseases to the work place. The hospitality industry cannot afford to have absences from work due to sickness as we know by now that ‘warm bodies’ provide service. Moreover, the hospitality industry handles food which is governed by strict municipal legislation. Poor hygiene can lead to the cancellation of their licenses. The organisation also does not want alcoholics, drug addicts, or people with mental problems. These conditions could easily lead to criminal behaviour. Organisations outsource employee medical testing to a clinic which protects the organisation’s interests.

Background Checks Background checks are becoming more and more popular among employers who are trying to find the perfect employee for their company. Background checking is the process of authenticating the information supplied to a potential employer by a job applicant in his or her résumé, application, and interviews. This is a good practice because US research indicates that 20–25 per cent job applications include at least one fabrication. There is cost to negligent hiring, especially when incompetent (or dangerous) people are hired. There are many companies around the world, everything from Fortune 500 companies to the small businesses rely on background checks to give the final link to a hiring decision. There are now many outsourced companies that specialise in background checks. They offer great service, a very fast turnaround time of result, and available legal advice when tests come back with a doubt. Background check companies will also provide accurate reports and records that an employer can rely on. It is ethical to let the candidate know that the organisation will conduct background checks and even get a written consent from the candidate. Any hesitation by the candidate when informed about checks raises a red flag. Common background checks include: l l

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Verification of academic credentials Verification of prior employment including position, longevity, salary, and job performance, sometimes tracing back ten years or to the three prior positions Discussions with business, professional, and personal references and verification of letters of recommendation Physical examinations and psychological tests Testing to confirm skills and knowledge An Internet search, on the candidate’s name, especially at www.google.com to confirm an individual’s claims about their jobs, performance, awards, and more Criminal background checks.

The key question is: “Are these selection methods effective?” There are three terms related to effectiveness—reliability, validity, and utility.

Reliability Reliability relates to the consistency of measurement. Are the scores that are outcomes of various tests dependable? Scores can come from paper-and-pencil-tests, interview rating, or other methods mentioned above. The level of reliability is represented by a correlation coefficient. The extent of correlation is measured from 0 to 1.0. A selection method that has a coefficient of 0.8 or higher is considered very reliable. No selection method can achieve 100 per cent reliability, but the aim is to have an acceptable coefficient. What happens to those who do not use measurement in selection? Only time will tell whether their selection was right or not sometimes at great cost. HRD Managers must always evaluate their recruitment strategy thrown up by performance appraisals (see Chapter 5, “Performance Management and Appraisal” for details).

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Validity Validity is the extent to which a selection method predicts one or more important criteria. Most organisations may want to predict the chances of successful performance. But there are other criteria such as honesty, loyalty, logical thought, etc. which are difficult to evaluate. A selection method is valid when the scores at selection compare well with the performance of the individual. Then, validity has a job relatedness that is desirable by organisations. Validity also has a coefficient ranging from –1 to +1. The higher the coefficient, the greater is the relation between a selection method and ultimate performance. Below is a comparative chart (Table 4.1) of validity of various selection methods. TABLE 4.1 Comparative Chart Assessment Tool Aptitude Tests Structured Interviews Unstructured Interviews Work samples Job Knowledge tests Personality Tests Biographical Information Situational Tests Attitude Tests Assessment Centres Reference Checks

Validity 0.51 0.51 0.31 0.54 0.48 0.31 0.35 0.34 0.41 0.37 0.26

Utility Utility concerns the economic gains derived from using a particular selection method. The formula works by deducting the cost of using a selection method from the increase in revenue. Naturally, we want a low utility ratio. It reflects the success of attracting qualified personnel to the benefits they bring to the organisation. Selection methods with high validity, but low cost are ideal for utility. The HR Manager must attempt to devise new selection methods to get both validity and utility.

Reference Checks These are different from background checks in as much as the referees are provided by the candidate. The trouble with it is that the referees always speak in glowing terms about the candidate. One sees that the validity is very low (.26). Some organisations have found a novel way to improve validity. They have sent cleverly designed questionnaires seeking opinions on performance of the candidate to all the referees. They are able to compare the ratings of the various referees. This approach makes good sense as past performance is a strong predictor of future performance.

Interviews These are face-to-face interaction for the purpose of selection. It is the method of selection most commonly used. However, few people are actually skilled at interviewing. The process is critical because it tells the candidate how professional the organisation is.

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Interview Rating Sheets All interviews must have rating sheets that give scores from 1–5 against various personality traits and performance related issues. The scores are then collated to get an average score of suitability. Some organisations use rating sheets that records impressions of the interviewer(s). Such rating sheets cannot score the impressions.

Types of Interviews There are many types of interviews:

Directed or Structured Interviews These interviews elicit specific information. The questions are so framed to solicit an—answer either a “Yes” or “No,” or a monosyllabic answer. This method is used to ascertain facts. An example is, “Are you presently employed?” The answer can only be “Yes” or “No.” Undirected or Unstructured Interviews These interviews ask open-ended questions to get a person to talk more. Open-ended questions start with What, Where, When, Which, Why, and How. An example is “What are the duties and responsibilities in your present job?” The candidate is obliged to give an expanded explanation. Preliminary Interviews These interviews are conducted initially either in person or by phone, to determine whether a candidate has the basic qualifications to warrant a subsequent interview. This is conducted usually by the HR department. The interview could be a combination of directed and undirected questions to gather facts as also to understand your personality, ambitions, and intentions. Such preliminary interviews could typically ask questions like: 1. 2. 3. 4. 5.

Why do you wish to join our organisation? What are your career goals? What are your interests? What are your strengths and weaknesses? Why do you want to leave your present job?

Multiple Interviews Multiple interviews follow the preliminary interview. It could be with one person who makes the decision or a series of them individually or in a panel. In these interviews, the focus is on how a candidate will perform in relation to the company’s goals and objectives. After the interviews are completed, the interviewers meet and pool their information about a candidate’s suitability for the job. A variation on this approach involves a series of interviews in which unsuitable candidates are screened out at each succeeding level. Panel Interviews These are popular to save time. Panel interviews include all those involved in the hiring decision. They meet together to question a candidate from their respective perspectives and later discuss the candidate and give their decision there and then. A panel may have two to seven people. Board Interviews These are normally held at the final selection stage or for senior appointments. The board consists of senior members of the organisation who bring collective experiences to ascertain a candidate’s suitability for the organisation. Stress Interviews These are used when the interviewer intentionally attempts to upset a candidate to see how he/she reacts under pressure. Candidates are asked questions that are uncomfortable. Although it is uncommon for an entire interview to be conducted under stress conditions, it is common for the interviewer

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to incorporate stress questions as a part of a traditional interview. There are two types of stress—physical and emotional. Physical stress can be evaluated in physical group tasks. It is the emotional ones that are tricky. There are ethical issues on the use of stress interviews. Candidates feel humiliated and cornered bringing out sometimes unusual responses including anger, crying, black outs, uncontrollable giggles, etc. Some examples of stress questions are: 1. I don’t like you. Convince me to start liking you. 2. I don’t like the colour of your dress. Why did you wear it? 3. I don’t think that women will be able to do this job. Why should we select you? (asked to a woman candidate) 4. You look nervous. Why are you so?

Situational Interviews Situational interviews constitute a method where situations (caselets) are given of common problems encountered on the job. The responses to these situations are measured against pre-determined standards. This approach is often used as one part of a traditional interview rather than as an entire interview format. Some interviewers may even employ role-play, which is acting out a situation. One that is commonly used is asking a candidate to sell the interviewer a pen. The interviewer becomes the customer and the candidate the salesperson. Group Interviews These are used by selection panels for two reasons: 1. When there are too many candidates to interview in a given day—This method enables the interviewer(s) to assess large bodies of candidates and also save time. This process takes place at the preliminary stages of a selection process. 2. To observe a candidate’s behaviour in a group—This is important as organisations comprise large bodies of people working together towards a common objective. Such large bodies are further broken down into sub-groups who further distribute activities into teams. For example, an organisation breaks their workforce into functions with their own distinctive specialisations like marketing, finance, operations, human resources, etc. These departments will then have sub-sections as in the case of finance that will break their responsibilities into audit, income accounting, credit, payroll, cashiering, etc. Each would have their teams to fulfil larger goals. Interviewers want to see if a candidate can work in a team. It must be understood that group interviews are a part of the selection process and not an end in themselves. Group behaviour is only one part of an individual’s total personality. Group interviews are taken essentially in three ways:

Group Discussion (GD) A group of candidates will be asked to sit in a semi-circle or a full circle with or without a table in between. The group will be given a topic for discussion. Some groups may be given time to prepare while most have to discuss spontaneously. Sometimes, interviewers give two to three topics for the group to choose from, but assess how they go about choosing it. Once the topic is chosen the group is given 15–30 minutes to discuss the topic. The interviewer(s) observes the following: 1. Role Behaviour It is believed that when individuals are placed in undefined circumstances they adopt roles that they are most comfortable with. The following roles emerge:

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Leader: The Challenger: Active Debater: Maintainers: Isolationist:

A person who initiates and manages the discussion group. The person who gives counter arguments. The person who works on all aspects of the discussion. The person who manages the tensions of the group. The person who is silent in the discussion.

We cannot say which role is right or wrong. It really depends on the position(s) for which selections are being held. Management positions obviously value leaders; debaters are preferred for jobs that involve public interface like customer service, public relations, sales and marketing, purchasing, etc. The maintainers may be suitable for human resource jobs while the isolationists may be suitable for lonely jobs like research, accounting, IT, etc.

2. Communication Skills Another important outcome of a group discussion is the proficiency in communications. A group discussion throws up an individual’s ability to put forward ideas forcefully, articulately, and logically. The command over the language is essential for successful communication. The ability to listen and integrate other viewpoints with one’s own is also assessed. Customer contact jobs may need better communication skills than back office ones. Leadership roles will need good communication skills than followers who have to be good listeners. 3. Content Very often group members feel that it is the quantity of speaking which matters and not the quality of it. This is a misguided opinion. It is not how much the candidate says, but what he/she says that matters. The content is measured by their depth of knowledge and how logically and clearly it is put forward. Alternative viewpoints are always welcome to make the discussion richer. The interviewer must be ‘stirred’ by the discussion. 4. Emotional Stability Members in a group are under a bit of pressure especially since all are aspiring to be selected. An immature group would build up this pressure by being inconsiderate to others. Some become argumentative, dogmatic, over-bearing, biased, or emotionally aroused while others become insecure, quiet, withdrawn and nervous. Interviewers look for balanced individuals who are cool and composed yet assertive enough to hold their ground. Group Tasks This is a selection process where a group of 5–10 participants are given a physical task to accomplish. The task has several hurdles that require leaping, twisting, swinging, etc. to test physical prowess. This method is used by military selection boards but is increasingly used by other commercial ventures which require outdoor physical prowess such as in oil rigs, adventure sports organisations, etc. The human skills involve working as a team as well as leadership qualities like encouragement during failure, recognition in success, assisting members who are falling short of expectations, allotting responsibilities and setting personal examples. Physical abilities include endurance, stamina, coordination of the body, etc. While the above is usually performed outdoors there are group tasks performed indoors. Groups are pitched against each other to complete a task that require teamwork and inter-group coordination. Interviewers evaluate your behaviour in a team as well as interaction with other groups. Within the group, members automatically adopt natural roles. Typical roles that emerge are the leader who provides the plan, strategy, and direction; the negotiator who is comfortable to interact with other groups and negotiate for resources; the maintainer who looks after the psychological and emotional health of the group by managing differences within the group, especially when they are under pressure or crisis; the worker who is comfortable with industry and manual effort to complete the task; the loner who waits to be invited to take part in the proceedings

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or is totally disinterested in the group’s effort; and the philosopher who gives ideas and creative ways of looking at the task. The interviewer also sees the interaction with other groups whether they are cooperative or selfish, trusting or suspicious, fighting or sabotaging, shows pride for the group or brings it down. There are many other assessments interviewers can make.

Dialogue Panel This is a discussion between the candidates and interviewer who skillfully brings out personal qualities, attitudes, and motivations of candidates by clever questions. In this method, the interviewer ensures that everyone gets a chance to speak. The topic could be any topical issue. Case Studies Case studies are fun, interactive interviewing tools used to evaluate the multi-dimensional aspects of a candidate. Candidates are presented with information and asked to analyse, synthesise, and articulate a solution. Interviewers use case questions to see how well candidates listen, how they think, the logic behind their thoughts, and how well they can articulate their thoughts under pressure. Some interviewers ask case questions to gauge self-confidence, discover the candidate’s personality, and to see if problem solving genuinely intrigues them. The objective is not to determine if the interviewee got the “right answer,” but rather to evaluate the process the candidate used to structure a competent approach to derive a solution. Case studies test how a candidate: 1. 2. 3. 4. 5.

analyses information; sorts through an excess of data and identifies main points; thinks logically, structures his thought process, and organises his answer; maintains poise and clearly communicates under pressure; relays personality and characteristics that are considered a good “fit” with the company.

Verbal Case Studies Verbal case studies are when a candidate is given 30 to 45 minutes to read the case and make notes. He/She is then questioned about the case. Sometimes, this is done one-on-one and at other times the candidate is brought in as part of a group to solve the case. This is done to see how well a candidate can work as part of a team with strangers. What do interviewers observe in a verbal case study? l l l l l

Is the candidate writing down the case information? Is the candidate clear about the question and what has to be solved? Has the candidate asked about the client’s objective(s)? Has the candidate clarified questions about the company, the industry, the competition, and the product? Is the candidate laying out a logical structure to his answers?

What do interviewers observe during case discussions? l l l l l l l l l

Is the candidate enthusiastic and has a positive attitude? Is the candidate logical and making good business sense? Is the answer well-organised? Did the candidate state his/her assumptions clearly? Is the candidate creative? Is the candidate engaging, bringing others into the conversation? Is the candidate asking probing questions? Is the candidate quantifying his/her answer as far as possible? Is the candidate listening to others?

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Is the candidate bogged down in details? Has the candidate gone off on a tangent? Did the candidate use buzz words and business terms correctly? Did the candidate have trouble with math, percentages, etc.? Did the candidate summarise the answer? Was the candidate assertive or aggressive? Did the candidate keep to the time limits set?

Behavioural Interviews These interviews discover how a candidate acts in specific employment-related situations in the past. The logic is that past behaviour predicts future behaviour in similar situations, i.e. past performance predicts future performance. Traditional Interview vs. Behavioural Interview In a traditional interview, the interviewer asks a series of questions which typically have straightforward answers like “What are your strengths and weaknesses?” or “What major challenges and problems did you face? How did you handle them?” or “Describe a typical work week.” In a behavioural interview, the interviewer has decided what competencies are needed in the person they want to hire and will ask questions to find out if the candidate has those skills. Behavioural interview questions will be more pointed, more probing, and more specific than traditional interview questions. Some examples of behavioural questions are: l l l l l l l l

Give an example of an occasion when you used logic to solve a problem. Give an example of a goal you reached and tell me how you achieved it. Describe a decision you made that was unpopular and how you handled implementing it. Have you gone above and beyond the call of duty? If so, how? What do you do when your schedule is interrupted? Give an example of how you handle it. Have you had to convince a team to work on a project they weren’t thrilled about? How did you do it? Have you handled a difficult situation with a co-worker? How? Tell me about how you worked effectively under pressure.

Follow-up questions will also be detailed. Interviewers ask what the candidate did, what he/she said, how he/she reacted or felt. It’s important to keep in mind that there is no right or wrong answers. The interviewer simply tries to understand how a candidate behaved in a given situation. The response must fit the skills set and the position the company is seeking to fill.

Telephone Interview A telephone interview is a means of preliminary selection. It is used to cut distances and the cost of organising a face-to-face interview if a candidate is geographically separated. The phone interview must be viewed no less than an interview that is conducted in person. It is a means used to narrow down the list of candidates for a face-to-face interview. It is a popular method nowadays as one of the timesaving techniques. Fitting into busy schedules, the interviewer can discuss matters with a potential candidate prior to an official meeting; clarify discrepancies or concerns; conduct an informal introduction; discuss the position; and/or ask for additional career information. Interviewers take into account that the candidate is also evaluating the organisation by the way questions are posed; etiquettes and manners shown; and the tone of professionalism in the interviewer’s voice. One of

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the first courtesies is to ask if the call is at an appropriate moment as most calls come at inopportune times. The interviewer likes to make sure that the candidate is not distracted so as to give the proper answers. The interviewer must have good verbal skills to reflect a positive image of the organisation.

Tele-conferencing Interviews Technology has empowered organisations to conduct tele-conferencing interviews. The only handicap is that the candidate must also possess that facility. To circumvent that, the organisation may ask candidates to come to its local branch office at a specified time for the interview. In such a case, the interviewer has a chance to see the candidate ‘face-to-face’ as also to study the body language that accompanies such interviews. Luncheon Interviews Luncheon interviews are held when an employer has a schedule and they will try to kill two birds with one stone: a meal and the interview. There are some interviews that are held at breakfast with one interviewer, followed by lunch with another, and then dinner with yet another. Another reason why many employers conduct a meal interview is to evaluate a candidate in a social setting, particularly if this is something that is part of the candidate’s job description. Sales executives, for example, require meeting, with clients on a regular basis over a meal. A third reason for conducting luncheon interviews is when senior executives do not want to be seen by their present employer meeting a prospective employer. They do not want to be seen in the premises of another company, thereby raising suspicions. A meeting over a meal is less conspicuous. A Luncheon interview has some benefits. The relaxed setting can provide a forum for candidness. An interviewee can provide answers freely rather than regurgitating textbook versions of what the employer “wants to hear.” Luncheon meetings can discuss management obstacles, short- and long-term business goals, employee relations, confidentiality issues, and operations logistics. This type of meeting can be informative. Interviewers observe the following at the luncheon interview: Dress: Whether the candidate projects a professional image even though it is an informal setting. Punctuality: Whether the candidate is on time for the meeting. The interviewer likes not to be kept waiting. Seating: Whether the candidate shows courtesy by letting the interviewer sit first. Social Confidence: The interviewer would like to see the candidate’s comfort in a social setting. Posture: Whether the candidate sits upright or slouches in the chair. Table Manners: A confident eater will eat with poise and correctness and will manage the cutlery with poise and correctly even though questions are asked. This is critical if the job involves social entertainment. They will also be able to manage food, especially difficult items to handle. Consideration over Menu: Whether the candidate orders lower priced items or goes for the most expensive, showing least consideration. Offering to Pay: The interviewer will normally charge the lunch to the company, however, he/she will observe whether the candidate offers to pick up the tab. While these are the additional things that are observed in a luncheon interview, the main purpose is to evaluate whether the candidate is suitable for the job. (Offer Letter, Reference Check, Appointment Letter, and Joining Formalities are discussed later in this chapter.)

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5. BASIC INTERVIEWING SKILLS Interviews are a meeting of two interested parties. It is unfortunate that both interviewers and interviewees fear these meetings, when in fact it can be a wonderful dialogue. There are both advantages and disadvantages of interviews: Advantages: 1. It provides an opportunity for a face-to-face meeting. 2. Both the candidate and the interviewer can clarify doubts of mutual interest. 3. Both can get first hand information. 4. It provides an opportunity for negotiation. Disadvantages: 1. 2. 3. 4. 5.

It is time consuming. Not everyone is skilled in conducting an interview, but do so anyway. There is a stress on the candidate for selection. It is prone to be leaked out, especially when candidates are working in competing establishments. The issue of salary is an embarrassing point for both the candidate and the interviewer.

There are a few tips to make interviews pleasurable.

Preparation Preparing for an interview is vital to make the time of the interviewer worthwhile. Preparation includes: l

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Matching the candidate’s résumé with the Job Specification. This would have already been done at the screening stage. Résumés do not give all the information and the interviewer would like to make a list of questions and clarifications. Making questions specific to the individual. Many interviewers ask standard questions which candidates prepare with brilliant replies. Selecting an interview room free from distraction. Such a room must not have a telephone connection to disturb the interviewer. The room should be ambient and equipped with drinking water. It is recommended not to provide tea or coffee service because that may distract the conversation. Candidates who come from other organisations may not like to enter a competing hotel’s premises. Interviews may be held at neutral places like a coffee shop or a business centre. If the interview has to be at the organisation’s premises, then the interview hall must have a separate door for entry and exit in case another candidate is waiting outside. It is not recommended to keep a table between candidates and the interviewer. This shows power and candidates get intimidated with it. Keep Interview Rating Sheets available to record interview comments.

Putting the Candidate at Ease l

An interviewer’s objective is to get honest and accurate replies. Often interviewers put the candidate “against the wall,” which does not result in getting the best of answers or bring out only distorted ones.

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It is important to be on time. Candidates too have their schedules in a day and would like the interview to begin on time. It shows that the organisation is professional by valuing the candidate’s time. The interviewer must go to where the candidate is seated and receive him or her with a formal greeting. Often it is the receptionist or secretary who does the formal greeting and will lead the candidate to the interviewer’s room. It is important to put the candidate at ease with small talk. Perhaps a chat on the hobbies and pastimes of the candidate, or a special event in town, etc. would be useful. If nothing else is these to discuss, talk about the weather! Once the candidate is at ease, it is important to establish the purpose and format of the interview.

Interview Techniques l

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Let the candidate do most of the talking. The ideal distribution of discussion should be—80 per cent of the talk should be done by the candidate and 20 per cent by the interviewer. Use open-ended questions which start with What, Where, When, Which, Why, and How. This gets the candidate to give larger explanations. Use close-ended questions to ascertain facts. When a question is asked, give time to the candidate to compose his or her thoughts. The silence is a tactic to get the person to speak. Use body language to full advantage such as eye contact to show interest; smile to defuse the stress of the situation; nodding to establish comprehension, etc. Never write on application forms. There could be legal implications. Questions should not be discriminatory. Discrimination questions relate to caste, religion, sex, age, region, colour, etc. Stick to the job only. Some states by the enactment of law may have job quotas for minorities, women, handicapped, war veterans, etc. This should have been ascertained at the screening stage and not in the interview.

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Invite questions and clarifications from the candidate. Tell about the benefits of joining the organisation—its management, career plans, training, employee benefits, etc. Give details of the job position including working hours. Discuss salary expectations. Some organisations may like to tell a candidate why he or she is not suitable at the end of the interview. Most like to make a selection after interviewing other candidates. In each case, it is important to tell the candidate when to expect a reply. A reply must be sent. Thank the employee for his or her time and escort the candidate to the door. This is a common courtesy that gives the candidate self respect.

Pitfalls of Interviews 1. The main pitfall of interviews is bias. Managers use their own yardsticks of judgement that reflect the weaknesses of their own personality. Many like a candidate that has the same traits as the

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interviewer. Impressions are formed based on perceived similarity between the candidate and himself/ herself. Stereotyping is one of the biases. Stereotyping is ascribing a trait of a group of people to an individual. In the hospitality industry, a typical stereotype is that only women are suitable for housekeeping jobs. Another stereotype is men with beards cannot work in guest contact areas. Interviewers tend to use these stereotypes excluding good talent from being selected. In an interview rating sheet, the tendency is to choose the middle of the road score. So in a five point score, interviewers choose a rating of three to be safe. Rating sheet designers overcome this by having a four point rating scale. Interviewer fatigue is a common ailment, especially when there are a series of interviews scheduled for the day. The early candidates get all the attention and inquiry while the late ones are hustled through. Often the good ones come at the end also. Improper interviewing environment such as background noise, interruptions, telephone calls, etc. can influence interviews. While creating a proper environment is an essential condition to a professional interviewer, many managers interview in their offices or other inappropriate places where distractions are bound to happen. Emotional factors like stress, time pressures, the desire to succeed, etc. also have an influence on the quality of interview. Candidates then become a nuisance and disrupt the main purpose of the interview. Interviewers are only human and have to deal with their own emotions first before they can give objective attention to the interview. Some interviewers fail to do justice to an interview because of their lack of knowledge of the position they are interviewing for. Little background knowledge about the job may cause distortion in the decision-making process because of irrelevant assumptions of job requirements. It is said that interviewers make a first impression in favour or against a candidate in the first two minutes. If the impression is negative, then the candidate will have to work extra hard to negate that first impression. On the other hand, if the impression is positive, then the interviewer overlooks a few negative points to concur with his/her first impression.

Overcoming Interview Pitfalls Organisations know the value of proper interview processes because of the cost and time it involves. They overcome the pitfalls by the following precautions: l

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They insist that anyone interviewing must be put through a formal training in interview techniques. They believe that the interviewer must get full mileage from the time he/she spends with a candidate(s). Organisations want to standardise and quantify interview rating sheets. Such formats must be continuously evaluated for their validity till they find a good rating system. The ratings must be behaviourally specific to the kind of responses candidates can give. The ratings must only correlate to the job with those factors that would constitute a good performance. The ratings should be based on quantitative rating scales that provide a continuum of possible responses. There must be a policy on the interview rating environment. Most HRD departments of hotels are in the basement of the hotel. Should candidates be interviewed in the least attractive place of the hotel? A policy may insist that interviews are conducted in the banquets halls or a specially designed meeting

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room where the hotel can showcase themselves to attract the best talent. Such interview rooms must be free from distractions. Interview ratings must reduce rating personality traits leaving this to more scientific measurements. This reduces bias. Interviewers tend to concentrate on personality than job performance. Interview questions can be related to work analysis outputs that will bring responses closer to the performance desired. Avoid jargon or jokes that may distract from the formality of an interview. It is important for the interviewer to be aware of the strategies used by candidates to impress interviewers. There are many coaching schools which train the candidates on how to face interviews.

6. APPOINTMENTS AND JOINING FORMALITIES Offer Letters Offer letters show the intent of an organisation to provide employment to a candidate in writing. The following are the basic issues that offer letters must mention. Additional information may be added based on the policy of the establishment.

The Job Title This is important to confirm the job position being offered. There is a distinction between a job title and designation. The job title is the term used for a position best accepted and understood by the public. Considerable effort is being made to create innovative titles to give employees self-respect in society. A room attendant can be called a “Floor Hostess,” etc. A designation is the root role against which salaries and benefits are given. In the given example, the designation is “front office agent.”

Reporting Relationships These are the immediate boss and the boss’s superior. This establishes whom the job-holder has to get decisions and directions from and in his absence, the next senior person.

Date of Joining This defines when the hired person is expected to commence work. The date of joining establishes when salaries and benefits are applicable and when the incumbent can be scheduled into the workforce.

Salary and Benefits This is key information on which the candidate makes a decision whether to join or not. Salaries are basic components of pay to cover basic needs of an individual. These may be in the form of basic pay, house rent allowance, transportation allowance, and position allowance. Benefits are those additional facilities provided to an individual to attract the best in the job market. Benefits are sometimes statutory like gratuity, leave and leave pay, pension deductions, medical benefits, etc. while other benefits may be company specific offerings such as leave fares, free duty meals, company accommodation, education allowance, domestic help allowance, etc. Organisations have moved away from break-up of remuneration and prefer to give lump-sum remunerations to permit the individual the freedom to use the money as he or she pleases.

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Probationary Period It is necessary to give all new recruits a trial period in which the organisation and the individual can decide whether to make the employment permanent or not. Probationary periods can range from three months for junior positions to one year for senior management positions.

Reference Checks These are done to ascertain the candidates work proficiency, character, and teamwork from past associates. There are two types of reference checks: l

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Candidate References given by the candidate from the school/college, prominent people, and previous employers. Independent References are made directly by the establishment with previous employers, police, previous bosses, and social clubs.

Then, there are two purposes of references: l

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Character Certificates show the character traits of a candidate. Organisations prefer such certificates from valued people in society, including school and college principals, responsible people known to the candidate, police records, etc. Work References are given by previous employers to confirm the period a person has worked in the organisation, the role he or she performed, and the work application of the employee.

The Appointment Letter The appointment letter is the final contract between an organisation and the candidate. The issues mentioned in an appointment letter are: l l l l l

Job Title Reporting relationship Joining date Salary and benefits Probationary period

The above are the same as mentioned in offer letters. However, there are more clauses added in an appointment letter. l

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Notice Periods establish the time period required for the severance of service between the organisation and individual. During the probationary period, the notice is normally twenty-four hours, while during confirmed service the notice can be from one to three months based on the criticality of the position. Legal Provisions are those that are required by the law. These include not indulging in criminal activities, being intoxicated at work, being involved in malpractices, etc. Confidentiality Clauses are added by organisations to prevent company information and secrets being leaked to the competition. Job Description of the candidate’s position is enclosed in order to have a clear perception of what is expected from him or her.

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Joining Formalities There are processes to formally register the employee into the organisation. Some of the formalities are dictated by law, such as salary and employment contracts, while others are dictated by the organisation’s policies. Joining formalities include: l

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Copies of Original Certificates: Organisations insist on this to confirm that a candidate is qualified for the post. Certificates often asked for are the birth certificate, school leaving certificate, college certificates, employment certificates, and training certificates. A Medical Check: This is mandatory in many organisations to ensure that a candidate is physically fit to do the job. It also establishes whether the candidate has any communicable diseases like aids, tuberculosis, open sores, etc. This becomes critical, especially when dealing with guests. Formal Application Form: Most establishments prescribe their own application form for the candidate to fill, though they may have received the candidate’s curriculum vitae/résumé. This is to ensure that the information that the establishment values is consistent for all employees. For example, an application form may insist on an emergency telephone number in the event of a crisis to the candidate at work. Establishments may want to know the blood group of the candidate in case of an accident at work that requires immediate hospitalisation. Copies of References: We had seen earlier the importance of reference letters. These references are kept on file as a record of authenticity of the reference. Induction/Orientation: Progressive organisations will have an orientation programme to familiarise a new candidate to the organisation in order to make the candidate productive in the shortest period of time. The orientation includes the organisation’s products and services, history, who’s who, organisation structure, dos and don’ts, company policies, etc. Issue of an Identity Card: Most organisations would like their employees to carry an identity card to confirm their employment with the organisation. This identity card is useful in case of accidents on the road, or for identification for entry into the premises. Organisations also prescribe staff numbers for accounting purposes and the payment of salaries and wages. Information to Accounts for the Payment of Salary: It is a joining formality to inform the Accounts department, so that it can open a salary account for the new candidate. The Accounts department may want bank account details to deposit salaries directly into the candidate’s account.

7. ORIENTATION AND SOCIALISATION What is Orientation and Socialisation? Orientation is the process of familiarising a new employee to the organisation so as to achieve commitment and contribution. Socialisation is the teaching of the organisation’s culture, values, norms, and behaviours that are consistent to the success of the company. Another joint terminology for both is induction.

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Why should we Orient and Socialise? The first thirty days are crucial to get a new employee’s commitment. It is a period of anxiety, excitement, and uncertainty. The first objective is to remove the anxiety of the individual by adapting him or her quickly to the new environment. The employee can either become a positive member of the organisational team or a demotivated and disillusioned one. There are many benefits for both the organisation and individual, if they get to know each other at the earliest. The organisation benefits by introducing the individual into the work mainstream. It is an opportunity to communicate expectations as also how the job fits into the organisation’s mission. Orientation and Socialisation bring in a consistent awareness about the rules and regulations of the organisation. The individual benefits by getting an opportunity to learn about the organisation and see the broader picture. The new incumbent can clarify doubts of what is expected of him or her. An important benefit is the learning of new skills, if required, especially to meet the organisation’s standards. Orientation and Socialisation programs can last from a day to several months based on the policy of the establishment.

Types of Orientation and Socialisation Group Sessions This is done with two or more new employees. Organisations may find it tedious to do induction on a daily basis. They may allot a day or week to have sufficient number of joiners to attend the Orientation and Socialisation programme together. This method is important to large organisations that have many joiners in a week. A group session helps individuals know that they are not alone and can foster new relationships, some of which remain throughout their career with the organisation.

Individual Sessions These are done on a one-to-one basis. New managers, who join occasionally, may benefit from one-to-one induction. The greatest benefit is the personal attention that a new employee gets. Some organisations may give a general induction to a group of employees and then assign them to individuals in their department to further induct them in the job.

Self-Orientation Some organisations may not have a fully developed Orientation and Socialisation programme. They may leave the individual to orient himself or herself by providing the employee with company brochures, policy manuals, rules and regulations, etc. The individual will then list the unfamiliar information and have a question-answer session with a designated older employee.

Mentor Session Mentoring is a popular method used these days. A new employee is paired with an older employee of the organisation from another department. The mentor is trained to act as a catalyst to induct the individual without being the direct appraiser of the individual’s performance. (see “Mentoring” in Chapter 10 for details)

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What does Orientation and Socialisation Involve? The list below explains the various issues that are covered in a professional induction programme. We see that the information is broken into four parts: 1. that which concern the organisation as a whole; 2. unit information, which becomes more important in a multi-unit operation like fast food chains or hotel chains; 3. the department in which the individual is recruited and will be working; and 4. job related information. Orientation and Socialisation methods are many and are only limited by imagination. However, common Orientation and Socialisation programmes covers information given in Table 4.2 and include the following:

1. Distribution of Orientation Kits To deliver all the information given in an Orientation and Socialisation programme one requires a variety of sources and documents. Plenty of planning and preparation is necessary to get this information together in a folder. The person given the responsibility of Orientation and Socialisation has the following to put together. The information required is got from: l l l l l l l l l l l l l l l l l l l

Organisation Charts Facility Map Company Videos Company publications List of key terminology Policy Manual Union Contracts Job Descriptions Company Holidays List List of important telephone numbers Employee Handbook List of company benefits Performance Appraisal Format Training Programmes Sources of information Emergency Procedures Manual Orientation Checklist Copy of Company Publications Quality Manual

In addition, the folder may include the forms and formats concerning all the joining formalities as mentioned in the previous topic.

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2. Talks These are given by the head of the organisation or senior members who welcome the joiners on behalf of the management to the organisation. It is quite possible that the senior person provides the organisational input as shown in the chart.

3. Audio-Visual Presentations These support talks with PowerPoint presentations, slides, films, and corporate promotional movies. Wherever it is difficult for the head of the organisation to be present for all inductions, his or her message to new employees can be recorded in a film.

4. Luncheon To welcome joiners in an informal setting. Senior members of the organisation are invited to the luncheon to meet and chat informally and convey important information. Progressive organisations make it a must with management appointees. It may even include the spouse of the joining manager.

5. Tour of the Property This is an essential feature of an Orientation and Socialisation program. A hotel may like to show the departments that the employee will coordinate with such as kitchens, stores, housekeeping, etc. The tour also shows the important facilities like washrooms, locker rooms, employee cafeteria, training rooms, uniform exchange counter, accounts where salaries are paid, in-house bank, first-aid kits or in-house clinics, etc.

6. Introductions These are important to make up work linkages. Introductions are made to senior management, immediate boss, departmental colleagues, and others that influence the job position.

7. Questions and Answers These sessions at the end are done to clarify any doubts.

What Facilities are Required for Orientation and Socialisation? The induction room may be a classroom or banquet space with theatre style seating or U-shaped seating. It must have light modifier to dim lights when the audio-visuals are on. The general equipment required are: Overhead projector with stand l l l l l

Laptop computer LCD Projector with stand Video/CD Player Video Cassettes/CDs Flip Chart Board/White Board

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TABLE 4.2 Blueprint of an Orientation and Socialisation Programme l l l l l l l l l

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Organisational Vision, Mission, Philosophy Organisational Structure Who’s Who Cultural issues Products and Services Achievements Growth Plans Career Opportunities Training and Development Plans Quality and Customer Service Programme

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Unit Organisation structure Who’s Who Unit objectives Products and services Unit Policies and Procedures Rules and Regulations Tour of the property Communication Systems Laws impacting unit performance Welfare Activities Emergency procedures

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Job Related Job Description Working hours Work Schedule/shift Breaks Introduction to Department Members Training in Specific Skills Key Terminology Compensation Details

Who does the Orientation and Socialisation? The Human Resources Department drives the Orientation and Socialisation Programme. Large organisations may even employ a full-time Orientation and Socialisation expert. However, the programme is the responsibility of everyone. The principal characters would be the Human Resources Manager, Departmental Head, immediate boss, and colleagues. The person who leads the Orientation and Socialisation programme often has the following qualities: l l l l

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He/She is a role model He/She is well groomed and fit He/She is a good communicator He/She has thorough knowledge of organisational policies, procedures, and functions. He/She shows respect for others He/She is a Motivator He/She is people focussed He/She is enthusiastic

Summary Human Resource is the most important asset in the hospitality industry. However, it is a challenge to get the right person for the right job. It is not the quantity of people, but the right quality which is (Contd.)

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Summary (Contd.)

always in short supply. Hotels vie with each other for the “small pot” of right talent available. Organisations can attract them by first looking at internal human processes that should create the best internal environment to attract and retain good talent. Internal processes start with recruitment and selection policies, procedures, and practices. They must be progressive in order to improve the probability of getting the best talent using the many selection methods that are there. The HRD manager must be innovative in finding and developing the right sources to get the right people. It is not enough to get the right person on board but that the candidate’s initiation into the organisation is through correct joining formalities which include thorough orientation and socialisation.

Key Terms Contact Cross Training Employment Agencies Interviews Job Advertisements Job Analysis Job Description Job Fairs Job Postings Job Specification Head Hunting Lateral Transfers Lead-time Networking Promotion Recruitment Reference checks Reliability Selection Screening Sourcing Talent Bank Task List

Getting in touch with candidates for interviews and tests Training of employees in other related job positions Public organisations that connect the unemployed population to recruiters Face-to-face interface for the purpose of selection Job announcements in the media Defining the broad elements of the job A profile of a job Gathering of recruiters and job seekers Announcement of vacancies on relevant notice boards A profile of the person to do a job Process identifying talent in competition to attract for employment Moving employees with similar jobs to other locations The time lapse between a demand and the satisfaction of it Making contacts with other persons of use Advancing someone from a lower position to a higher one Process of getting qualified human resources from the market Process of ascertaining a candidates work proficiency, character, and teamwork from past associates Consistency of measurement Process of choosing from eligible candidates Process of matching résumés with job specifications Identifying suitable places to obtain qualified human resources Inventory of eligible “drop-in” candidates A detailed document of duties and responsibilities. (Contd.)

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Key Terms (Contd.)

Testing Utility Validity

Evaluation of a candidate’s knowledge, skills, and attitudes Economic gains derived from using a selection method Accuracy in prediction

Review Quiz Short Notes 1. Give in detail the internal, external, and non-traditional sources of recruitment. 2. What are the advantages and disadvantages of internal and external recruitment? 3. Write short notes on the following: (a) validity (b) reliability (c) utility (d) reference checks 4. What are the different types of interviews? 5. What are the pitfalls of interviews and how can they be overcome? 6. What does orientation and socialisation involve? 7. What is the typical kind of information found in an appointment letter?

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Performance Management and Appraisal

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1. PERFORMANCE APPRAISAL AND ITS IMPORTANCE Performance appraisal is a formal, structured system of measuring and evaluating an employee’s job-related behaviours and his/her potential for greater contributions to the organisation. The purpose of performance appraisal is, therefore, to ascertain an individual’s present and future value to the organisation. His present value is assessed by his past performance, while his future value is determined by his present potential. A good appraisal would bring to light these two aspects. There are four critical aspects of performance: 1. 2. 3. 4.

Performance must be linked to results. Performance is tied to behaviour (that produces results) Behaviour can be active or passive (not doing something can also achieve results). Behaviour must relate to the job only (unless off-the-job behaviour affects performance).

Unfortunately, many performance appraisal systems confuse performance with personality traits (e.g. honesty, hardworking, patient, etc.) and certain behaviours like punctuality, team orientation, etc. There may be an argument in favour of these traits and behaviours in a service industry like hospitality. It is important that servers are well groomed, show etiquette and manners, and are sociable and friendly. However, personality traits should be a function of recruitment and selection and not of performance appraisal. A person hired for the hospitality industry must possess certain essential traits as a ‘given’ to enter the industry. A person without those critical job traits should not have been hired at all. Performance management, on the other hand, is concerned with behaviours that effect performance. Behaviours such as punctuality, cost-consciousness, and sociability are important, but it is the result of those behaviours that matters in a performance appraisal and not the behaviours themselves. To summarise, performance appraisal is concerned with the work that is performed and not the characteristics of the person performing it.

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Benefits of Performance Appraisal Research shows that performance management when done correctly can effect corporate performance and the bottom line. It can also give an organisation a competitive advantage. Performance appraisals feed other development programmes such as career plans and succession plans. It also helps in reviewing and improving upon recruitment and selection methods employed. Performance measurement is used to compensate and reward (increments, merit pay, incentives, bonus awards, etc.) employees, determine performance improvements, and ascertain staffing decisions such as promotions, transfers and exits. It also becomes the central source of assessing training needs, employee development, and people research. It serves other broader purposes as follows: Performance Measurement: It establishes the relative value of an individual’s contribution to organisational goals. Performance Improvement: It encourages continued successful performance and identifies weaknesses for improvement in order that the employee becomes more effective and productive. Compensation: It rewards individuals according to their performance. Identifies Potential: Performance Appraisal identifies those employees who can be developed for higher responsibilities. Communication: It establishes a dialogue between the superior and subordinate on a regular basis to improve on contributions. Feedback: It lets an employee know how he/she is doing. This gives the employee emotional security as he/she has a chance to correct mistakes while taking pride in what is achieved. Development: It provides the framework for purposeful human developmental inputs. Human Resource Planning: It helps the organisation take stock of human capabilities and the knowledge and skill wealth that it has. An Organisation can then deploy its people gainfully.

Factors of Performance Appraisal A good performance management system will thus have the following factors built into it: 1. Precise measurement of performance in terms of quantity, quality, and timeliness. 2. Incorporating valued performance outcomes that link to the organisation’s strategic goals. 3. Weightage based on the frequency of activities. For example, a project will carry a heavier weightage than routine tasks. 4. Linking performance to internal and external customer requirements and expectations. 5. Taking into account perceived limitations and unexpected occurrences. For example, a bar manager cannot be held responsible for his sales targets if a new legislation reduces bar timings. 6. The system is focussed on development, continuous improvement, and an employee’s potential for future growth.

2. DESIGNING AN APPRAISAL SYSTEM In order to design a performance management system, it is important to first define what is meant by the term, work performance. Work performance is a tangible record of outcomes (results) of a job function or activity

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that has contributed to the goals of the organisation within a time period. A Restaurant Manager’s outcome can be the sales he/she generates against desired targets set for him/her; a hotel trainer can be assessed on the quality of training that he/she has provided on time, measured by the incremental performance outcomes of those he/she has trained. The IT professional’s performance can be judged by the number of hours of systems breakdown. The challenge really is to quantify all jobs, especially of staff functions. A Facility Planner, for example, works on project basis and can be evaluated by the timely completion of the project and the satisfaction of the user department to his/her inputs. An accountant can be evaluated on the accuracy of reports and records. Time becomes a criterion especially for job outcomes that cannot be quantified.

Who is Responsible for Performance Appraisal? A performance appraisal system is the property of the entire organisation and not the HRD Department alone. All stakeholders in the system must be consulted when developing it. These include the potential appraisers, employees, HRD professionals, and most preferably, the customers. Customers can give a feedback on their expectations in service in terms of time, quantity, attitudes, etc. All appraisers would decide on: l l l l l l l

Desired outcomes or results of each job function Measures of these outcomes Time period of assessment Who should rate the performance Who drives the performance management system What administrative requirements are needed to actualise the system What follow-up processes are required

Desired Outcomes The job analysis gives precisely the individual components of a job. What is desired next are the results required from each component. Poor appraisals concentrate on activities rather than on outcomes. For example, ‘registering a guest’ is an activity for a receptionist. An activity allows the rater to give impressions of the performance rather than the outcome of that activity. However, if the outcome desired of registering a guest were to be translated into measurable terms, it would read as: l l l

‘the average registration should take 3 minutes;’ ‘guest complaints should be less than 10 per cent;’ or ‘the number of rooms that are assigned correctly.’

Measurement makes the tasks more result oriented. Rating of personality traits as mentioned earlier are only predictors of performance and not measures of actual performance. While personality traits may be important in the service industry, they must be treated separately. Proper hiring practices would have addressed the personality traits already making those criteria redundant in the performance system. Effective performance appraisal focuses on the performance outcomes that contribute to the organisation’s goals. Generally, there are six broad categories of outcomes: 1. Quality: 2. Quantity: 3. Timeliness:

The degree to which an activity relates to the standards set. The amount produced in terms of money, units, cycles, etc. The degree of urgency an activity is performed with in relation to acceptable time standards.

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4. Cost-effectiveness:

The degree to which the organisation’s resources are maximised resulting in cost reduction, minimum loss, and wastage. 5. Need for supervision: The degree to which the employee can work independently. 6. Interpersonal impact: The degree to which relationships benefit the business. A receptionist in a hotel or a Maitre-d’Hotel in a restaurant can ensure repeat customers on the basis of their rapport and good service provided. Good outcomes are when employees contribute more to the organisation than what is stipulated in their job descriptions. Such employees integrate their personal traits and behaviour to outcomes that exceed expectations. There are some tasks that are contextual, which means that an employee’s efforts benefit other employees and their desired outcomes. For example, the accuracy with which a Reservationist makes a booking enhances the performance of the receptionist. Inaccurate information may negatively impact the receptionist. Similarly, coaching by the supervisor improves the performance of the subordinates. For instance, a restaurant manager may coach a waiter. The desired outcome of such coaching is the additional revenue the waiter is able to generate as a result of the coaching.

Measures of Outcomes Organisations should set standards of performance. So, if a standard set is three minutes for registering a guest, then we can measure the actual performance against that standard. If the acceptable standard for receiving customer complaints is 10 per cent of all customer interaction, then any excess is considered below average performance and anything less is good. A zero per cent customer complaint is excellent. Upselling of rooms is a desired outcome. These can be quantified in term, revenue. The greater the ability to measure performance, the greater will be the effectiveness of the performance system. Standards are established by various methods: 1. By comparing with industry standards 2. By ascertaining the average performance standards of existing employees (which could be lower than industry standards) 3. By observing the standards set by the best performer and benchmarking other’s performance against it 4. By making the setting of standards an essential part of job analysis in which an independent view is created by experts.

Quantitative Methods While individual outcomes are measured against standards, the rater also gives an overall rating for the aggregate performance. Most commonly used overall rating is a four-point scale of Excellent, Above Average, Average, and Below Average. There are other five methods employed: 1. Paired Comparisons Where the rater compares a performance to another on a single criterion, e.g. overall performance. The subordinate with the second greatest number of favourable comparisons is ranked second and so on. The formula with such pairs is n (n-1)/2, where n = the number of employees. This becomes difficult when they are large teams. 2. Straight Ranking This is when the rater identifies the best performer, then lists the second best, then the third best, and so on. 3. Alternative Ranking The rater puts the best subordinate at the head of the list and the worst at the bottom. He/She then selects the best and the worst from the remaining subordinates. Here, the next best is

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placed second on the list and worst placed next to the last. The rater chooses the best and the worst until all subordinates are ranked. The middle position on the list is the last to be filled by this method.

4. Forced Distribution This is when the rater is forced to distribute performance across ‘below average,’ ‘average,’ ‘above average,’ ‘excellent’ ratings in a Bell Curve where there will be 10 per cent or less incumbents each in ‘below average’ and ‘excellent,’ and the rest approximately 80 per cent distributed in the ‘average’ and ‘above average’ category. Such a system is used because raters find it difficult to rate people less than ‘above average.’ The term ‘average’ in many environments may seem ‘fair’ when actually they have received this rating having fulfilled all the desired results. Raters want to be the ‘good guys’ with the team whom they work with day-in-day-out and find it difficult to give ratings less than ‘above average’ when the employees have fulfilled all the desired outcomes. Moreover, overall ratings are linked to increments and rewards. An ‘average’ rating will attract one increment on the grade scale, an ‘above average’ would attract one and a half, while ‘excellent’ gets two increments. Raters want to get the best rewards for their team. Functional heads argue that they have coached and motivated their team to a high level of performance. This is fine provided the departments, results testify to that claim. In other words, outcomes must justify a claim. Jack Welsh, ex-CEO of General Electric, said, “A company that bets its future on its people must remove the lower 10 per cent and keep removing it every year—always raising the bar of performance and increasing the quality of leadership.” 5. Absolute Standard Here the comparison is not with other subordinates, but with absolute standards established through experience, comparison with industry practice, benchmarked with the best in the industry, or through time and motion study. Therefore, doing 16 rooms in a shift for a room attendant is an absolute standard. Qualitative Methods While the above mentioned methods are generally on quantitative basis, assessment can also be done on a qualitative basis. The qualitative basis does not evaluate the extent to which a job is accomplished, rather, it evaluates whether certain desired behaviour exists or not. There are three methods of qualitative assessments: 1. Critical Incident Method Here, the supervisor, along with the subordinate, makes a list of the desired behaviours in a job. These behaviours can be further segregated into various aspects of the job. For example, a waiter must complete mis-en-place efficiently, be well groomed at the briefing, and know the ‘non-available’ items of the day. All these may be classified under pre-operations behaviour. The operations behaviour would include behaviours like taking down orders correctly, providing service at international standards, upselling food items, etc. In this method, the supervisor then observes whether these behaviours are carried out. In fact, he/she may maintain a little ‘black book’ to note down incidents of desired behaviours not achieved. These incidents of behaviour are considered at the time of evaluation. 2. Weighted Checklist An experienced performer of the job lists the components of a job much like a job analysis, and then gives weights as to the importance of that component to the job. The rater then ticks the behaviours that were shown and those not shown with ticks and crosses. The illustration (Figure 5.1) of a counter salesperson of a pastry shop gives an idea of the weighting process. (The weights have not been scientifically determined. They just illustrate the point. They have to be established by an expert.) 3. Forced Choice Method This is also developed by an expert who is able to identify the correct dimensions of the job. This method forces the superior to choose between several alternatives along a scale that best describes the subordinate. The system has several statements that describe the various dimensions of the job. The diagram (Figure. 5.2) illustrates the method.

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Tick (ü) if behaviour exists Cross (x) if behaviour is absent

Job Component

Scale Value

Impeccably groomed

8.0

Requisitions adequate stock from confectionary

5.6

Checks stocks for freshness

6.0

Asserts for quality

4.0

Ensures minimum spoilage in transit to pastry shop

5.0

Displays items artistically

4.8

Courteous to customers

8.0

Uses salesmanship to increase sales

6.0

Packages items as per standard

6.4

Accounts for sales accurately

8.0

Tardy in maintenance requests

1.9

Keeps pastry shop barely clean

4.4

Contacts customers personally

7.4

Total

FIGURE 5.1 | Weighted Checklist

10

5

0

Punctuality Ahead of time Submits assignments on time

10

Submits ahead of time 10

On time usually 5

Submits on time

5

Always late 0

Submits late

0

Customer Orientation Always makes positive impression on customers 10

Comfortable with customers

5

Nervous with customers

0

Team Orientation Asset to the team

FIGURE 5.2 | Forced Choice Method

Sociable and friendly

Is not a team person

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While the example above has given three choices per job dimension, organisations usually give five descriptions to give a wider choice. There are organisations that have given as high as 25 descriptions per job dimension to make the evaluation even closer to the subordinate’s performance. It is significant to learn that all the qualitative methods above make it difficult to give a feedback to the employee, especially when the performance is poor, because the rating is on impressions, not on quantifiable or measurable criteria. While small enterprises may make-do with the above methods, it is certainly not recommended for larger organisations, especially those which are transforming into the new age of human resource management. The key to the future of evaluation is measurement of contributions to organisational goals.

Time Period A year is an acceptable period of assessment of performance worldwide. This period can offer quarterly or half-yearly reviews which are recorded for any misinterpretation of facts. Then, there is the question of aligning the performance period to the budget period as rewards and increments are often linked to appraisal systems. If the budgeting year was April to March then a similar period of appraisals is not conducive. The appraisals must finish at least three months earlier to factor in the increments and rewards into the budget. But again, the performance of the organisation is linked to the budget and individual goals are linked to organisational performance. There has to be agreement on alignment through creative ways.

Who Should Rate the Performance? The immediate supervisor is the best person to assess performance. He/She is close to the performance and can make realistic estimates of it. The boss of the immediate supervisor can be the second assessor to give objectivity to the system. He/She also acts as the arbiter in case of disagreements between the first appraiser and employee. The 180 and 360 degree (which we shall discuss later) have multiple raters. They are the ones directly influenced by the job position.

Who Drives the Performance Appraisal System? The HRD department is best equipped to drive the system throughout the organisation. They are also able to integrate the results of performance with other systems that they drive such as career planning, succession planning, training and development, recruitment, and selection.

Administrative Requirements The main requirement is to announce the appraisal time and the time by which they must be completed and returned. This is a great challenge to the HRD department in the hospitality industry. Appraisers are so caught up with daily pressures of providing quality service that they do not give or have time to spend on appraisals and consider these a nuisance. It seems so ironic, especially when people make the difference in the hospitality industry. The HRD Department is hassled with having to remind the appraisers of time deadlines. If we believe that performance appraisal drives organisation’s performance and creates the competitive advantage, then the argument of not having time to appraise is not valid. This is overcome by making appraisals a key outcome of the appraisers in their performance criteria. Another administrative requirement is to analyse the appraisals and send recommendations to the Finance and Accounts for increments and rewards. There is also the associated aspect of confidentiality and filing of documents for future reference in case of litigations, etc.

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Follow-up Processes The information from the appraisal system is fed into other HRD systems like career plans, succession plans, training and development plans, etc. This is the work of the HRD department.

Criteria for Performance Appraisal Systems and Procedures There are some criteria that performance appraisal should follow to be fair and legally correct. Performance Appraisals should enhance morale and motivation and not debilitate the workforce. Some important criteria are: 1. The system should be standardised and uniform for all employees in a job group. We cannot have different yardsticks for receptionists, for example. All receptionists must be judged by the same criteria to be fair. 2. The appraisal system should be communicated to all employees before it is introduced. They must be clear of the objectives and what will be considered an average, good, and excellent performance. 3. The appraisal must evaluate current performance to be considered legal. 4. The system must be reliable and valid. It must specify performance criteria that are job related and important. (Validity is established through job analysis. See “Selection Processes” and “Basic Interviewing Skills” in Chapter 4.) 5. Outcomes must be measurable. Such measurement must be against standards. 6. Subordinates must be informed and counselled on deficiencies in advance to give them time to rectify them. This is why mid-term appraisals are held quarterly or half-yearly to correct shortcomings. In other words, deficiencies should not come as a shock to employees. 7. The appraisal should be transparent. The results and what is recorded must be shown to the employee. It is for this reason that completed performance appraisal forms are required to be signed by the employee. Any disagreements are recorded for higher intervention. 8. The system should provide appeal mechanisms for disagreements on performance. Good appraisal systems provide the employee access to a superior’s boss for arbitration on disagreements. 9. Performance should eliminate bias. Some organisations have multiple raters. Normally the immediate superior and the boss give separate evaluation. 10. All appraisers should have gone through a formal training on how to conduct appraisal. Their comments and objections should have been taken into account while devising the system. 11. All performance appraisals should be documented. For this, there is a carefully devised performance appraisal form. 12. The system should be reviewed for any abuse of the system. 13. The criteria of rating should be job related based on job analysis. 14. If personality traits are essential to the job performance, then the results of behaviour should be assessed (and quantified wherever possible).

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3. TYPES OF APPRAISALS Management by Objectives (MBO) MBO is an approach to managing. It puts goals and objectives at the heart of this style of management— particularly in the processes of planning, leading, and controlling. It is a philosophy of management and unless this philosophy reflects in all the processes, the MBO is doomed to fail. The philosophy of MBO is: l l l l

that all people are responsible; that individuals and the organisation can grow together; that the assessment of performance should be transparent; and that the human potential is vital to the success of the organisation.

The main fault of all other appraisal systems is the element of subjectivity. One method of evaluation used earlier was the Trait Method. The Trait Method evaluated certain behavioural characteristics like punctuality, attendance, teamwork, grooming, ability to follow instructions, etc. While some could be measured most others could not, and opened the doors to subjectivity. In order to avoid subjectivity, the best approach is to evaluate performance and not personality. The Management by Objectives (MBO) is one such method to counter subjectivity.

MBO MBO involves the following: 1. Provide a subordinate with a framework of performance, its purposes, and objectives. 2. Subordinates set performance objectives for themselves. 3. Supervisors and subordinates discuss and modify these objectives of performance and mutually agree on them at the beginning of the performance period. 4. Review the progress of the performance quarterly or bi-annually to see whether objectives will be met. 5. Assess whether they have been achieved at the end of the year.

Setting standards of performance is implicit in the objective setting process to ensure quality of performance. The challenge in this system is measurement. A good system as discussed earlier, is when we are able to measure performance. Traits and behaviours, therefore, should be linked to outcomes of such behaviour resulting in questions like: “Were the standards not met?” “Was there a loss in revenue?” “Were services not delivered on time?” “Was there wastage and loss, and if so, how much?” Research has shown the MBO method has improved motivation and performance.

Benefits of MBO 1. It directs work activities toward organisational goals. 2. It aids in planning. 3. It provides clear standards for control.

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4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16.

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It provides improved motivation for managers and the managed. It makes for better use of human resources. It reduces role conflict and ambiguity. It provides more objective appraisal criteria. It better identifies problems. It improves the development of personnel. Deficiencies are not looked upon as areas for punishment, but as opportunities for training and development. The appraiser is able to identify training needs. The system is future oriented and gives a correct picture as to what potential an individual shows in terms of performance. It binds the superior and subordinate to act as a team to achieve targets. The actual appraisal becomes transparent and both look upon performance as something that is mutually beneficial. Focuses on the individual (his/her performance, feedback, communication, potential, reward). Opens communication between superior and subordinate.

Steps in the MBO Approach Step 1 Decide the performance year: Earlier organisations coincided the performance year with the financial year. While some organisations follow January to December as their financial year, others follow April to March. The financial year also makes budgetary provisions for the ensuing year for increase in salaries and bonuses. The problem of aligning the performance year to the financial year is that appraisals are done much after the financial year and miss the annual budget to put in the recommendations for increments and bonuses. Organisations alter this situation by delinking the two periods. So if the budgeting year was April to May, they made the performance year January to March giving ample time for recommendations and rewards to be factored into the next year’s budget. Appraisals earlier were used solely for the purpose of giving out increments and bonuses. Now organisations also use it as a powerful developmental tool, where weaknesses are looked upon as training opportunities. Step 2 Set standards of performance: Some standards are already fixed like cleaning 16 rooms in a shift or cleaning a departure room in 40 minutes for a room attendant. The appraiser must always seek to measure performance. Measures do not lie and are accepted by both the assessor and assessee. Step 3 Set objectives and targets with the subordinate at the beginning of the performance year: Objectives must be realistic and measurable and follow the SMART principle discussed earlier. For example, here are some objectives for a housekeeping room attendant: l l l l l l l l

Average number of rooms cleaned in a shift percentage of guest complaints Average time to prepare a room Number of mistakes observed during inspections New ideas introduced for continuous improvement Number of positive Guest comments Cost-control measures employed and the amount saved Feedback of colleagues (360 degrees feedback discussed later)

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Most important aspect of objective setting is that the employee must understand them and believe that they can be achieved. The appraiser must listen to any doubts or apprehensions in achieving them. The objectives must be realistic and attainable. The appraiser must also explain the performance required for an ‘Above Average’ and ‘Excellent’ rating.

Step 4 Review performance quarterly or mid-year: An employee likes to know how he/she is doing. Feedback is a strong motivator and the employee has time to correct his/her performance if there are any weaknesses. Sometimes, objectives will need to be altered as situations change. For example, an unplanned major convention booked during the performance year can introduce a set of new performance objectives. Step 5 Approach the system as a developmental tool: The appraiser must be perceived as a mentor and coach. he/she must discuss weaknesses as opportunity for training. The employee may need inputs of knowledge, skills, and attitudes which have different methodologies from the simple to the sophisticated. Such inputs become the individual development plan (discussed in Chapter 7, “Career Development and Succession Planning”) which dovetails into a larger departmental training and development plan. Step 6 Conduct an appraisal interview in a relaxed atmosphere and with an open exchange of ideas: Earlier, appraisals were done behind the back of the employee. Employees did not get an opportunity to express themselves, and received “surprises” at the time of increments and rewards. This closed door approach is obsolete. An employee must be given an opportunity to discuss his/her performance jointly and plan a way to overcome weaknesses, if any. The employee must be given enough time to prepare for an interview. The interview must be held in a quiet and relaxed place and the appraiser must guard against any distractions. It is an important time for the employee and he/she must get the full respect that the occasion demands. Strictly concentrate on the individual’s performance and not the personality, unless the personality is obstructing performance and service such as grooming and hygiene. Give the subordinate an opportunity to explain himself or herself. Help the subordinate to identify deficiencies and chalk out action plans for improvement. Recognise and praise a job done well. Show the subordinate the path for future growth. Encourage the employee to higher standards. Let the employee know the overall rating he/she will get for that performance and note down any objections. Such objections can be discussed with the superior or the HRD manager. Step 7 Document an individual development plan that is acceptable to the employee and receive a joint signature of agreement: Include the individual development plan in the Department Training and Development Plan that goes to the training department that will advise or organise appropriate training programmes. Step 8 Send in writing the recommendations for rewards to the superior. Figure 5.3 clearly illustrates the appraisal process.

Balanced Scorecard The Balanced Scorecard is an innovative performance system introduced by Harvard professor Robert Kaplan and consultant David Norton. It focuses management to ‘leading indicators’ of performance that will ensure organisation success. Leading indicators are key areas of success. Examples of leading indicators are innovation (continuous improvement), teamwork, customer orientation, and cost effectiveness. The ‘balance’ applies these leading indicators uniformly across the organisation. This means that each employee links his/her job outcomes to these factors and measures them. Therefore, a housekeeping floor supervisor will be assessed on improvements as a leading indicator for instance at her workplace just as much

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Job Analysis

Determine Performance Criteria

Determine Organisational Goals

Set Individual Goals with Employee Input

Set Standards of Performance with Employee

Establish Standards

Review Performance Periodically

Conduct Final Performance Interview

Select the Appraisal Methodology

Communicate and Train in the P.A. System

Submit Recommendations for Rewards and Future Development

Review of Recruitment and Selection Procedures

Compensation and Promotions

Reward and Recognition Scheme

HRD to Link Information to

Career and Succession Plans

Training Needs Assessment

Training and Development Plans

FIGURE 5.3 | The Appraisal Process as the restaurant supervisor or the Bell Captain in the Lobby. Balance Scorecard believes that if everyone made a concerted effort in a few key areas across the organisation, then the organisation will achieve a competitive advantage. A development on the Balanced Scorecard is The Workforce Scorecard by Professors Mark Huselid, Brian Becker, and Dick Beatty. These authors show that traditional financial performance measures such as return on equity, stock prices, and return on investment can be predicted by the way companies conduct their HRD. Therefore, HRD practices are the ‘leading indicators’ that predict subsequent financial performance. It makes HRD an important function to the success of the organisation. HRD, therefore, must: 1. respond to the highly competitive marketplace, 2. be closely linked to business strategic plans,

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3. ensure that the HRD Manager and Functional Heads jointly conceive and implement proactive HRD practices, and 4. focus on quality, customer service, productivity, employee involvement, teamwork, and workforce flexibility.

180-Degree and 360-Degree Assessment This system believes that the every individual is responsible to give the same amount of attention to internal customers (colleagues) as they would to the external customers. This has become a formula for teamwork. It believes that the internal people who are most influenced by a job position must be able to give feedback on whether they are getting the right service and cooperation from a job position that helps them perform to high standards. Take, for example, a front office receptionist. He/She coordinates with the telephone operator, reservationist, front office cashier, housekeeping supervisor, and Bell Captain. They are not able to perform adequately if they do not get the right inputs from the receptionist. This performance system permits them to assess the performance of the receptionist. A 180-degree assessment system makes the receptionist’s peers assess her performance in addition to her immediate superior. A 180-degree assessment system is a reasonable stepping stone to the 360-degree system. The 360-degree assessment system includes the subordinates as well. Through this, a person’s leadership is assessed. An organisation’s culture needs to be very transparent and mature to adopt a 360-degree assessment system because nobody normally likes to be assessed by his/her juniors. The diagram (Figure 5.4) below explains the concept.

Superiors

180-Degree

Peers

Job Holder

Peers

360-Degree Subordinates

FIGURE 5.4 | 180-Degree and 360-Degree Appraisal HRD professionals today should possess up-to-date knowledge of the best practices in performance management. Some organisations adopt a Performance Appraisal (PA) system for fashion and not for its spirit. A PA system should be designed to enhance employee competencies and productivity, so that people can be a reliable source of competitive advantage. The PA systems mentioned above are part of High Performance Work Systems (HPWS). HPWS ensures high performance teams.

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HPWS will have the following characteristics: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13.

Hire the right people for all positions and highly qualified ones for strategic positions. The use of validated selection procedures. Extensive training and development to enhance performance. Use performance appraisals to gain a competitive advantage. Focus on results, not activities. Bring about transparency in performance. Link rewards and growth to performance. Pay above average salaries for key positions. Link everyone to incentive systems. Link personal growth to organisational growth. Higher differential pay between excellent workers and the average worker. Empower staff to self-manage their affairs. Fill higher percentage of jobs from within.

The Appraisal Interview Preparing for the Interview The appraisal interview is the occasion when a superior and subordinate meet to discuss the performance of the subordinate in a given performance period. To make the meeting successful, both the superior and subordinate have to prepare for it believing that it is an important moment for both—the individual and the organisation. Here is what each would do before the meeting:

Superior’s Tasks l

l

l

l

l

Inform the subordinate of the date and time of the interview. The time must be convenient to both as neither must be under any pressure to meet other obligations. Advise the subordinate to come to the meeting with his/her self-assessment. Handover an appraisal self-assessment form if one exists. Honour the allotted interview time by clearing all appointments and noting the time of the interview in the diary as an essential responsibility to complete. Select a place for the interview that is free from distraction. It may need booking a meeting room controlled by someone else. Review personally the performance record of the individual. All performance must be supported by fact. Some managers maintain a log-book of performance to be accurate about data.

Subordinate’s Tasks l

l

l

Review the objectives set and evaluate the achievements in the past performance period. Support the data with facts. List the outstanding achievements in the self-assessment form. List the reasons for not meeting some of the targets set. Was it because of lack of skill or teamwork or organisation constraints or faulty systems and procedures or tools and resources? Complete the self-assessment form which also elicits the career aspirations, strengths and areas of improvement, training and development required, and what the subordinate considers his or her overall rating.

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l

l

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Review individual career plans and see what training needs are required in the coming year to improve present performance and to develop for future growth. List exactly the kind of programmes or certifications required. Clear all other commitments to attend the interview.

The Appraisal Interview Typically the interview will have six phases: 1. 2. 3. 4. 5. 6.

Re-explaining the purpose of the meeting Discussing performance Identifying strengths and areas of improvement Listing coaching and group training programmes to overcome immediate performance deficiencies Listing action plans for improvement Reviewing career aspirations and recording development plans.

At the interview, the superior makes the employee feel relaxed to get the best discussion. Inform the subordinate of the purpose and objective of the interview, emphasising again on the following aspects of the interview: l l l l

That the interview is meant to review past performance and record future career directions. That the interview is all about the individual and how to improve his/her potential. That the interview is an open discussion without malice. That disagreement will be recorded.

Normally an appraisal interview should go on smoothly because the superior and subordinates have been in close communication during the performance year. Quarterly reviews and mid-year reviews reduce the element of shock to the subordinate. It also gives him/her the chance to improve performance should it fall short. The subordinate is given the opportunity to discuss his/her performance first, based on a self assessment. The superior then reads out his/her assessment. Both then tally their perceptions of performance. Normally, there should be little disagreements because performance is supported with factual data against standards. It is only when facts differ that there is a disagreement. Both can go back to their respective fact sheets to determine the true picture. Disagreements are recorded on the performance appraisal form. The superior will then discuss the strengths of the individual. They then discuss the areas of improvement and ask the subordinate for the kind of help he/she requires for improving performance. Normally the subordinate has already prepared suggestions. The superior offers his/her help and suggestions to personally coach the candidate. This is an opportunity to counsel the employee if there are some attitudinal deficiencies and seek some individual resolutions. The superior will discuss the rating he/she is going to give. Any disagreements are recorded for review by the second appraiser. They will jointly agree on an action plan in terms of dates, training inputs, coaching inputs, self-learning, etc. The action plan will also record the superior’s actions to remove the organisational constraints that impeded performance. Both will finally review the career plans by recording the programmes attended in the past year and the future inputs required. The career plans may include delays in progress towards an aspiration till a subordinate shows a consistent above average performance. The appraisal form is filled and the employee is given a chance to read and sign it in acknowledgement.

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4. PERFORMANCE COUNSELLING Performance counselling is a one-to-one interaction between an employee and the counsellor. The counselor can be the immediate supervisor or a specialist from HRD. The basic objective of the meeting is to improve performance. Such a meeting obviously takes place when there is a deficiency in the way an employee is performing. The deficiency in employee performance comes from the following sources: l l l l l l l

The supervisor’s observations A shortfall in agreed outcomes expected Customer complaints about the person Colleague’s grievances about the person Procedural irregularities Equipment abuse Increase in costs

The performance counselling meeting is not prescriptive, but exploratory. The meeting is held in private, away from the view of other colleagues. Employees are very conscious of other team members and may be defensive. The employee is told at the outset that the meeting is to help the individual improve performance to gain selfesteem, recognition, and future growth. The meeting should not be treated as a disciplinary one (unless the issues are disciplinary in nature). The employee is encouraged to own up his or her shortcomings without fear and give possible suggestions to overcome them. He/She may even seek help. The counsellor merely asks probing open questions that start with What, Where, Who, Why, Which, and How. Questions would typically be: “What is coming in the way of your performance?” “Where do you think you can improve?” “Who do you think can best help you in reaching peak performance?” “Why are there customer complaints?” “Which training programme can help you the most?” “How do you plan to improve?” “How can the management help?” Typically, most employees tend to blame everything around them, but the self. We can expect to hear complaints about the immediate boss, non cooperation from team members, faulty systems and procedures, faulty equipment, and unreasonable guests. While the counsellor takes such feedback into consideration for further examination, his/her role is to direct the focus from the outside influences to the internal attitudes and capabilities of the employee. The employee must talk of the self. Sometimes, the counsellor can give suggestions and recommendations for the employee to consider and select. Employees are sometimes unable to find solutions on their own. Options for improving performance can be: l l l l l

Coaching in some skills Self-learning using recommended reading Cross-training Team-building Attending appropriate training programmes

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Revision of systems and procedures Skills in handling equipment

The real challenge to the counsellor arises when the problem is an attitudinal or motivational one. The first step is to identify the real issue of concern. It could be ex-work like domestic problems, personal health, differing goals, etc. It does become the counsellor’s concern if such issues affect performance. The employee must be given the opportunity to discuss it and find some solutions. Often employees need someone to talk with to bounce issues. They often get another point of view to resolving the problem. Lack of motivation can arise from various reasons: l l l l l l l l l l l l

Lack of capability to do the job Job is too routine and boring Lack of challenge in the job Ignorance Low self-esteem Lack of recognition and attention Lack of future for advancement Oppressive boss Inadequate support Poor teamwork Faulty systems and equipment Work fatigue

The employee and the counsellor should be able to identify exactly the reason for demotivation and jointly work on resolving the hurdles. The counsellor must lead the discussion to a plan of action. These must be time bound goals with follow-up meetings. It is important to end the discussion to reconfirm the employee’s importance to the organisation and a promise of support for improvement.

5. REWARD AND RECOGNITION SCHEMES First, let us understand the two terms—“reward” and “recognition.” A reward is a physical token of appreciation of service, effort, or achievement. Rewards can be in cash or kind. Recognition is an official praise of service, effort, or achievement. Both are distinctly different from an incentive which is a pre-condition to receive a reward. (Fredrick Herzberg called incentives negative KITA). Incentives are carrots held before an employee which really brings the human to an animal level that needs to be seduced into performance. Incentives are preconditions to performance. Incentives are typically an industrial age phenomenon when an uncommitted workforce needed incentives to perform. Motivational studies show that true motivation actually comes from within, not from outside. External methods are manipulative. Reward and recognition are more appropriate because they are not pre-conditions, but spontaneous appreciation of effort. While cash rewards are discussed under compensation, we can consider here non-cash rewards.

Non-Cash Rewards The hospitality industry has some unique ways of giving non-direct cash rewards:

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Free Vacation for Two Chain hotel operations have an opportunity to give good performers a free vacation with board and lodging at their property in another location. The hotel where the employee works picks up the cost of the stay, usually given at cost price to the hotel.

Free Meal for Two Hotels and restaurants can give a reward of a free meal to a deserving employee. The meal is charged at cost-price to the hotel.

Supplier Donations Due to of the volume business given to suppliers, the hotel can request them to contribute ‘gifts’ to their star employees. Some hotels are able to get refrigerators, TV sets, crockery sets, cutlery sets, etc. from suppliers. These are capital items that are always welcome in any home and stand as testimony of good performance achievement to the employee’s guests and visitors.

Membership The organisation sometimes picks up the membership fee for a year for the employee to a golf club, gymnasium, social club, professional association, etc. which is sometimes out of the reach of employee’s own earnings.

Used Cars Companies are willing to sell or gift a used company car at book-value to the employee. The book-value is the depreciated value of the car through normal accounting practice and is considerably cheaper than used cars in the market.

Write-off of a Loan Some organisations give company loans at low interest rates to their employees. A reward could be a write-off of balance loan to the employee. Loans are taken usually to buy a car, to build a house, or for important personal reasons. Organisations give these loans to secure the employee to the organisation on a long-term basis. The employee benefits tremendously if a loan is written off. Naturally, the employee’s contribution to business must be far greater than the loan amount due.

Recognition Scheme The first consideration that one must have is that recognition is not conditional. In other words, recognition should be unexpected and a surprise. Recognition is a management prerogative and the union cannot bargain for it. The selection process of employees for recognition must be fair and consistent. Recognition must always be done in public. It raises the status of the individual among his/her peers. It also raises self-esteem. Some methods of recognition are:

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Pat on the Back It is the most powerful physical acknowledgement of appreciation. It costs nothing, but means a lot.

Words of Praise These can be made at briefings and other public gatherings.

Certificates of Recognition These are documents than can be framed and displayed with pride. They are useful for future job considerations. They are a physical proof of having achieved something worthwhile.

Trophies of Recognition Organisations design purpose-built trophies of recognition with their logo. Organisational trophies are not the usual cups and salvers received in sport. They are uniquely designed table-top pieces that are ornamental and worthy of public display at home or office.

Gifts of Recognition These are utility items at work or home. They are monogrammed with the company name and logo and even the name of the employee. Some examples are premium pens and watches, office table appointments, wallets, diaries, coffee-table books, lapel pins, tie-pins, etc.

Summary Performance Management (PM) is a management tool that ascertains an employee’s present and future value to the attainment of the organisation’s strategic goals. The evaluation of personality traits used earlier is outdated as PM recognises that traits are a function of recruitment and selection rather than of performance. Performance, on the other hand, is measurable against desired outcomes. PM sets up a continuous dialogue on performance between a superior and subordinate. It records the achievement of results, areas for development, career aspirations and potential. While HRD drives the PM system, it is the responsibility of the entire management of the organisation. Several options—quantitative, qualitative, result-based, and influence-based—are available to appraise performance. The PM system must be consistent, reliable, and objective with total transparency. Such transparency is achieved through appraisal interviews and performance counselling.

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Key Terms Performance Appraisal Work performance Job outcomes MBO HPWS Reward Recognition Incentive

A structured system of measuring and evaluating performance and potential Tangible records of results achieved Results of job performance Management by Objectives High Performance Work Teams Physical token of appreciation Official praise An external attraction to perform

Review Quiz Short Notes 1. 2. 3. 4.

What purposes do performance appraisals serve? What are the criteria to appraise performance? Explain in detail the MBO approach. Write short notes on the following: (a) 360 degrees assessment (b) HPWS (c) Performance counselling (d) Qualitative evaluation methods 5. Explain the process of an appraisal interview.

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6 Training and Development 1. OVERVIEW OF TRAINING AND DEVELOPMENT Training is perhaps the most vital activity today. The hospitality industry has come to the view that training is key to its survival and success, given the high pressure to compete, improve quality, enhance customer service, and lower costs. Furthermore, technology has crept into the hospitality industry, which has traditionally been a hands-on industry. We see microwaves in food operations, networked reporting systems, wake-up call software, Mini bars, food dispensers in hotel floors, etc. Obsolescence is becoming a word much feared these days. Technology is getting outdated every eighteen months. Hospitality professionals need to keep up-todate with technology to survive in their careers. Progressive hotels build training into their way of life. We have seen in the previous chapter that performance management systems throw up training gaps. Performance is measured by results and training is the only way to fill performance gaps. To understand this subject, we need in the first place, to distinguish between three terms—“training”, “development,” and “education”. Training is the learning process in which an employee acquires the knowledge, skills, and attitudes that lead to changes in behaviour to meet some performance objectives. Therefore, training is performance driven and used in work environments. Ideally, training meets an organisation’s goals, at the same time meeting the individual’s goals. Development is the continuous improvement of human potential. Employees with experience need to develop themselves for higher positions as their jobs enlarge and enrich. Its focus is long-term, helping employees meet future work demands as well as their own career aspirations. Education is learning that contributes to total life growth. The time we went to school and college was indeed boring because we wondered how trigonometry, history, or social science would help us in our career. Education is not performance driven, but a system to help us adjust to the environment around us and assimilate it better. It lays the foundation to make better career choices. The new buzz word in the work context is “continuous education.” Unless we update ourselves periodically we are in danger of becoming outdated in our thinking. As a matter of fact, continuous education is not a luxury, but a means of survival nowadays.

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Organisational Viewpoint about Training Organisations generally train for the following reasons:

Convert Competencies into Currencies Specialised skills and behaviour can become the cutting edge for many hotels. For example, a professional concierge is a rarity. A multi-skilled houseman is a distinct advantage to a hotel with limited payroll budgets. A room-boy at a resort can double as a bell boy during the day. A chef of a rare cuisine can provide a competitive edge. For example, the Welcomgroup chain in India identified and perfected the North-West Frontier cuisine and the Dum Pukht cuisine. The special knowledge and skills of the chefs became money spinners.

To Get a Competitive Advantage Training does give an organisation a distinct edge. Large organisations have invested big money in setting up training schools of note. The Oberoi Hotel School, The Welcomgroup Graduate School of Hotel Administration at Manipal, the Taj Hotel school in Aurungabad are some Indian examples. These schools bring out human products that are uniquely special to their organisation adopting the unique culture and professionalism of that organisation. The Educational Institute of the American Hotel and Lodging Association in Michigan and Orlando was originally sponsored by large American chains to produce basic standards of knowledge and skills for their hotels worldwide. With these investments, the concerned chains are able to develop a continuous supply of quality performers to meet their high standards of service.

Fear of Obsolescence Every organisation fears obsolescence. With so many new hotels opening, the customer is pampered and is quick to forget an old way. Hotels have to update their product and services to match the practices in the market. For example, not long ago, hotels created executive floors in recognition of an expanding and lucrative business segment. Soon, business travellers got used to business lounges and business centres. Those that did not cater to this segment fell behind. Similarly, technology has made vast strides in the way hotel operations are run. Travellers are able to make room reservations directly over the web and get immediate confirmation. The future is promising as innovative ways are being introduced to provide unique dimensions to guest experiences.

Changes to New Technologies The change in technology as explained earlier, is a good reason to update oneself. The introduction of computerisation in hotel systems and procedures is a huge reason for training. The future is expected to introduce nano-technology, fiber-optics, bio-technology, etc. into the way hotels are run. Training is essential to keep up with these new innovations being introduced.

Globalisation This phenomenon has brought great opportunities. Not only it has opened doors to global employment but also shrunk the divide in work styles. A room attendant in Baku, Azerbaijan would soon have the same job description as the room attendant in Dublin, Ireland. Large American chain operations worldwide have introduced certain common practices to local professionals wherever their hotels have been located, be it in Madrid, Manila, or Mumbai.

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Improve Productivity As human capital is expensive and scarce, the challenge is to make existing staff productive. This is done by technology, work design, and outsourcing. The de-layering of organisations makes decision-making quicker. This brings in a whole new dimension to traditional ways of doing things.

Retain Customers The hospitality industry recognises that the cutting edge is customer service. The modern customer is fickle and will go to where they will get a better customer service. The web has given them several choices at bargain prices. The only way to counter price considerations is customer service and value for money. Customer recognition is a great motivator to a traveller. Training in this one aspect can bring customers back again and again.

Avoid Lawsuits The hotel industry is subject to many laws and regulations to protect guests. There are laws concerning hygiene, sanitation, storage, fire, safety, etc. Lawsuits can result in high fines or even the closure of the establishments. Employees are trained in tasks that meet requirements.

Individual Viewpoint about Training Individuals do recognise the importance of training to keep up-to-date. They welcome training and development. They realise that training and development helps them improve their worth. However, they also know that organisations are not willing to spend big developmental budgets on them for fear of losing them to the competition. Organisations rather invest in training to improve performance and capabilities that will earn them a return on investment in the short-term. Individuals, therefore, have no choice, but to put their precious earnings into continuous education and development. The employees also recognise that their careers could be cut short by the next generation which is coming with the latest knowledge and skills. Individuals train for the following reasons. l l l l l l l l l l l l l

Job security Growth Improvement Challenge Sense of discovery Improve self-worth Recognition Sense of achievement Knowledge power Social acceptability Contributions to work place Fear of obsolescence Status

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2. THE TRAINING PROCESS Figure 6.1 below depicts the training process clearly: Training Policy

Standard Operating Procedures

Task Analysis

Training Needs Analysis

Follow-up

Evaluating Training

Conducting Training

Planning Training

FIGURE 6.1 | Training Process

Establishing a Training Policy Policies regarding training have to emerge from the corporate management or the owner of the business to get employee commitment to training. The corporate polices are translated into operational policies that make training a continuous and committed way of life. Training policies are discussed in detail later in this chapter.

Establishing Standard Operating Procedures The logical flow from policies is to develop operational systems and procedures, with standards to ensure consistency. A receptionist, for instance, is guided by a set of systems and procedures that ensure proper documentation and customer satisfaction. International hotel chains have developed operation manuals for every aspect of hotel work life. They set the standards for the industry.

Task Analysis From these operational procedures flow the tasks that make up the procedure. These are documented through Task Analysis that addresses the sub-tasks, what has to be done, how it is done, and the standards that have to be maintained for each task. The task analysis becomes the base document for training (see the task list in “Job Analysis” in Chapter 3).

Defining Training Needs This is an exercise done in response to certain considerations that show deficiencies in organisational performance. “Training Needs Analysis” is discussed later in this chapter.

Planning Training Plans include setting training objectives, developing lesson plans, and organising the venue, methodology, and training aids.

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Conducting Training The training must follow the training objectives, lesson plans, and methodologies selected.

Evaluating Training It is important to evaluate training for their effectiveness. Trainers want to know whether training has achieved the desired level of learning; learners want to confirm their level of retention of knowledge and skills; and management want to know whether training has achieved their strategic objectives and addressed performance deficiencies.

Follow Up This is the step taken to correct/improve on the training effort. This exercise revisits every aspect of the training process to make it more effective. The diagram (Figure 6.2) below illustrates the concept of a systematic approach: Training Needs Analysis l Organisation l Functional/Job l Individual

Outcomes Desired l Organisational Results l Departmental Results l Meeting Standards l Behavioural Change

Defining Training Objectives

Choosing Evaluation Criteria

Training Design

Creating and Assembling Training Methodology and Aids

Conducting Training

Evaluating Training l Effectiveness l Cost

FIGURE 6.2 | Systematic Approach

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3. TRAINING POLICIES AND PROCEDURES A policy is a guideline for future action. It reflects the company’s beliefs as also its commitment to action. Procedures are the way policies will be enacted to fulfill its objectives. Given below (Figure 6.3) is a case study of a Hotel (name withheld on request) showing how policies and procedures are written. They are based on the following key result areas: Identification of Learning Needs On-the-Job Coaching Criteria for Training Programmes Evaluation of Learning Results Training Abroad Mentoring

l l l l l l

l l l l l

Line Management’s Responsibility for Training Learning Professionalism Training Cost Effectiveness Reporting and Budgeting Individual Development Plans

Objective To help attract and motivate the very best people, XYZ Hotel is committed to invest in human resources through relevant systematic training, development, and where relevant, supplemented business education that contributes directly to the achievement of business objectives. All new appointments (whether through recruitment, transfer, or promotion), should achieve operational efficiency in the shortest possible time, and with the maximum appreciation of principles and values. Scope All employees, whose skills and competencies can be improved by further training. These include: l Permanent employees of XYZ Hotel l Trainees under development Policy XYZ Hotel is committed to investment in human resources. We wish to attract, retain, and motivate the very best people in our workforce through relevant systematic learning, development, and where relevant, supplemented business education, that contributes directly to the achievement of business objectives. All new appointments should achieve operational efficiency in the shortest possible time. 1.1

Identification of Learning Needs

Policy 1.1.1 All learning programmes should be part of XYZ Hotel’s strategic/operating plans with the specific objective of correcting performance gaps, both at an individual as well as organisational level, so as to add value to performance improvement, productivity, and service. Annual Learning Needs Analysis processes will, therefore, highlight: l What the business intends to achieve? l What knowledge, skills, or attitude gaps exist that inhibit employee achievement? Procedure 1.1.2 Each Unit Head and Department Head shall review and identify the specific learning needs of his/her business unit from a strategic, operational, or individual development point of view, as part of the annual planning process. 1.1.3 The identification of learning needs will be incorporated as part of the Performance Management scheme. 1.1.4 They shall recommend specific needs for improvement in knowledge, skills, and competencies, both at an individual and team level. 1.1.5 Recommendations will be submitted to the Manager—Human Resources Development who will review and collate an Annual Training Plan.

FIGURE 6.3 | Training Policy of a Hotel

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1.1.6 The Manager—Human Resource Development shall identify the providers, both internally and externally, to meet those needs. 1.1.7 The Manager—Human Resource Development shall administer and monitor all learning programmes and give the VP Operations the relevant feedback each month. 1.2 Line Management’s Responsibility for Training Policy 1.2.1 Line Management should understand their responsibilities to identify and satisfy their employees’ learning needs and recognise that the majority of learning takes place on the job. His/her responsibility shall be a key result area for them. 1.2.2 Where the learning takes place away from the workplace, Line Managers should be fully committed to, and practice, effective pre-and post-course/event briefings with employees. 1.2.3 At the time of nomination, all nominees must be clear about the purpose the training event is to serve. His/ her clarity will usually be supplied by the nominating Manager or the Manager—Human Resources Development. 1.2.4 Employees should be made to understand the need for, and the benefits of, effective learning and development and take ultimate responsibility for their own development. 1.2.5 All employees should have access to appropriate learning facilities and resources. The Manager—Human Resources Development will make available to all employees the schedule of learning programmes at the beginning of each year. 1.2.6 Training will be a key result area for all managers, within the Performance Management Scheme. Managers must log at least five hours a year in training. 1.3 On-the-job Coaching Policy XYZ Hotel recognises that the most effective method of training is systematically coaching the individual employee or trainee on how to perform his/her job, at the work site. On-the-job coaching is considered a basic supervisory responsibility. However, to achieve the desired objective, a formal on-the-job training programme is established in consultation with the Line Manager to improve job skills and the productivity of employees. Procedure 1.3.1 On-the-job Coaching Programme XYZ Hotel’s Line Management will provide on-the-job training programmes designed to develop or upgrade existing skills of individual employees and trainees to assist them in meeting job requirements. Such programmes will be based on Task Analysis and will include coaching and practice. 1.3.2 Task Analysis Line Managers will be trained to perform Task Analysis. The Task Analysis shall be the sole source document for on-the-job coaching. It consists of breaking down the job into its component parts and defining the knowledge, skills, and standards of each task. 1.3.3 On-the-job Coaching Progress Reports The progress achieved by each employee or trainee included in the programme will be measured against established standards for the job. The employee’s immediate Line Manager will prepare periodic progress reports. He/she will discuss them with the employee or trainee to point out areas for improvement or commend him/her for his/her accomplishments during the period, and give such reports for review to the Line Manager or Branch Head. The finalised reports are sent to the Manager—Human Resources Development for assessment of any further learning needs, follow-up, and necessary action. 1.3.4 Follow-up by Manager—Human Resources Development The Manager—Human Resources Development will assist the employing Department in the implementation of on-the-job coaching programmes and ensure effective implementation of such programmes. When a training report indicates unsatisfactory progress of an employee or trainee, the Manager— Human Resources Development will discuss the report with the Line Manager to determine the individual’s status and potential for further training.

FIGURE 6.3 | Training Policy of a Hotel (Contd.)

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1.4 Learning Professionalism 1.4.1 XYZ Hotel intends to establish itself as a Learning Organisation through continuous coaching and selfdevelopment (through internal and external means) at all levels. Each Manager shall have learning and development as an essential part of their job description. They shall be accountable for high quality standards of training. 1.4.2 XYZ Hotel encourages its employees to acquire professional qualifications and certifications wherever possible. 1.4.3 Given the focus within XYZ Hotel on lifelong development/learning and on-the-job coaching, all Line Managers joining XYZ Hotel should attend an accredited ‘Train the Trainer’ programme within one year of appointment, subject to them not having attended such a programme in their previous experience. The Manager— Human Resources Development will organise the ‘Train the Trainer’ programmes. 1.4.4 The Manager—Human Resources Development will develop effective training facilities within XYZ Hotel supported by an exhaustive Resource Centre providing internet, intranet, books, educational and training material, videos, audio-tapes, CDs, etc. 1.5 Training Programmes XYZ Hotel may, where necessary, provide training and professional development for all staff at local educational and training institutions in addition to in-house training to improve their performance standards in their present jobs, to prepare them for future promotion to vacant positions, or to train them for other positions. 1.6 Training Cost-effectiveness 1.6.1 Training, development, design, and delivery should be timely, effective, and cost efficient. Where possible, the use of more cost-effective training delivery methods, such as text-based and computer-based learning material, should be encouraged. 1.6.2 The Manager—Human Resources Development will put forward a training budget based on the Learning Needs Analysis. The Manager—Human Resources Development, prior to enrolment, should endorse all nominations for internal and external training programmes. All contracts with external training consultants will be processed by the Manager—Human Resources Development. 1.6.3 To ensure effective use of the XYZ Hotel’s training resources, nominating Managers should endorse the principle of ‘The right person, on the right programme, at the right time, at the right cost’. 1.7 Evaluation of Learning Results 1.7.1 Training results should be evaluated against business results, and the measurement of the return on investment of training provided is the responsibility of the nominating Line Manager. However, the Manager— Human Resources Development has created procedures for evaluation at all four accepted levels, i.e. Reaction, Learning, Application, and Business Return which are described below: Reaction and Learning should be applied to all training events through: 1. Feedback from training course assessment form. 2. Tests, exams, case study to check absorption. Application and Business Return should be applied selectively, e.g. two events or programmes per year through: 1. Follow up discussion between the Manager—Human Resources Development, Line Manager, and trainee. 2. Feedback on performance from Line Managers. The rating scales used should reflect the Performance Management and Development Review ranges. 1.7.2 The Manager—Human Resources Development will also evaluate the training programmes to see their effectiveness in achieving the training objectives. 1.8 Reporting and Budgeting A summary of key training initiatives for the plan year and associated training investment will be reported by the Manager— Human Resources Development. The initiatives will reflect the business needs as well as the employee needs resulting from the training needs analysis. The required investment will be recorded so as to report overall, annual, quarterly, individual and event costs accordingly as per an agreed schedule.

FIGURE 6.3 | Training Policy of a Hotel (Contd.)

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It is a prime responsibility of the Manager—Human Resources Development to reach agreement with the Line Managers and agree on the training investment, for budgetary purposes, prior to budget submission. As a guide to Line Managers, XYZ Hotel will earmark a minimum of 3–5 per cent of Annual Basic Salary as potential investment towards training and developing its staff. Actual investment will be driven by the prevailing business needs. The Financial Controller will monitor on-going expenditure against the approved training and development budget. 1.9 Training Programmes Abroad In specific circumstances, XYZ Hotel may sponsor employees on full time overseas training programmes designed to develop staff to fulfil specific business needs. Such programmes include professional development programmes and specialised training at recognised institutions or organisations. The CEO/President alone will make decisions on foreign training. The employee will also undertake in writing to work for XYZ Hotel after completing his/her training for a period of at least one year, otherwise he/she will be required to pay XYZ Hotel the amount spent on him during the training programme. If after his/her return, he/she works with XYZ Hotel for part of the specified period, he/she will be required to pay a percentage of his/her training costs equivalent to the ratio of the period he has not worked to the entire training period. 1.10 Individual Development Plans Defining individual training and development needs and providing specific development activities is basic to XYZ Hotel’s career development programme. The Individual Development Plan (IDP) may include: 1.10.1 Projects and Special Assignments Typically, these include feasibility studies, audits of procedures or systems, work on recurrent XYZ Hotel operational or administrative problems, installation of new office equipment, capital projects, etc. 1.10.2 Conferences, Seminars, and Courses XYZ Hotel encourages the professional development of its employees through attendance and participation in approved conferences, seminars, courses, etc. and/or membership of external bodies (e.g. Toastmasters) where there is perceived to be benefit to the individual and the business. The selected programmes will aim to develop external awareness, i.e. the key factors which impact the effective organisation—social, economic, political, etc. Nomination to those programmes is at the discretion of the CEO/President based on his/her training plan for XYZ Hotel. 1.10.3 Rotational Assignments towards a Multi-skilled Workforce and Career Development Policy 1.10.3.1 XYZ Hotel encourages a multi-skilled workforce to bring flexibility to respond rapidly to changes in XYZ Hotel’s business focus. 1.10.3.2 XYZ Hotel may, at its discretion, rotate an employee within or outside his/her Department, or assign an employee to a location different from his/her regular work location, as part of his/her development programme, provided he has spent at least two years in his/her current job. 1.10.3.3 Secondments and Cross Postings are encouraged. The duration may range from a short liaison or familiarisation visit to a related area or Department to a six-month or more secondment doing a specific job. 1.10.3.4 Job rotation and skills development plans for employees should be drawn up by Line Managers and followed. The planned and systematic acquisition of job-specific skills should be recorded through the performance development process. 1.10.3.5 An employee of recognised potential gains in knowledge and experience by temporarily assuming duties and responsibilities of positions, other than his/her own. Therefore, it is XYZ Hotel’s intention that positions vacated by the temporary absence of regular incumbents be utilised to the maximum practical extent for the career development of employees of recognised potential. A primary focus for XYZ Hotel training and development efforts should be the continuous improvement in employees’ performance in their current jobs and with particular reference to managing for value, productivity, customer service, operations, and regulatory/compliance requirements.

FIGURE 6.3 | Training Policy of a Hotel (Contd.)

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1.10.3.6 Employees on rotational or developmental assignments will retain their job level classification and pay during the period of such assignments. However, the fact of having temporarily assumed a position of broader scope and having discharged the duties of that position satisfactorily will be taken into account in their consideration for progression and further development. 1.11 Mentoring Policy XYZ Hotel will operate a mentoring programme using specially selected and trained Managers to provide guidance and advice that will help to develop the careers of young recruits. A mentor will not be the immediate boss or one who influences the compensation and performance appraisal of the individual. Procedure Mentors will usually be in a different Department from the employee and will be ‘wise in the ways of XYZ Hotel’ and will provide the following: l l l l

l

l l

l

Advice in drawing up self-development programmes or learning contracts. General help with learning programmes. Guidance on how to acquire the necessary knowledge and skills to do a new job. Advice on dealing with any administrative, technical, or people problems those individuals meet, especially in the early stages of their career. Information on the way things are done in XYZ Hotel—the corporate culture and its manifestations in the shape of core values and organisational behaviour and management styles. Coaching in specific skills. Help in tackling specific projects—not by doing it for protégés, but by pointing them in the right direction, that is, helping trainees to help themselves. A parental figure with whom employees can discuss their aspirations and concerns and who will lend a sympathetic ear to their problems.

1.12 Responsibilities 1. Line Managers and Branch Heads Line Managers and Branch Heads are primarily responsible for determining learning needs, setting learning goals, and ensuring proper implementation of approved employee learning and development programmes within their respective Departments in line with XYZ Hotel’s overall strategy and Annual Training Plan. Line Managers at all levels are expected to identify learning needs and coach employees under their direction, evaluate their progress, and report on such progress in accordance with established training and development programmes. 2. Manager—Human Resources Development The Manager—Human Resources Development is responsible for supporting the Departments to determine XYZ Hotel’s learning needs and employee development plans, choosing appropriate training sources and preparing and administering training and career development activities, as also managing the overall programme in accordance with XYZ Hotel’s operating requirements. 3. Individual Employee Each employee is expected to take personal responsibility for learning and applying that learning in his/her work environment for mutual benefit.

FIGURE 6.3 | Training Policy of a Hotel (Contd.)

4. TRAINING NEEDS ANALYSIS A needs assessment is a systematic and objective determination of training needs at the organisational, functional, and individual level. Basically, it is the gap between what is desired and what exists. These gaps may be existing ones in performance or anticipated ones as shown (Figure 6.4) below.

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Employees’ Ready for Higher Responsibilities

Exceeding Performance Training Gap Desired Performance Level

Existing Employees

Existing Performance Level

New Hires

FIGURE 6.4 | Training Gap The goal of a training needs assessment is to collect information that will identify training gaps. It is an activity that is conducted as part of the HRD planning process. These gaps then define training objectives. Training needs can be obtained from performance records of the organisation, department, and the individual; observation; interview; anticipated changes in the organisation; career plans; succession plans; technological changes; employee surveys; feedback from supervisors; and new hires. The organisation shall commit to training only when they perceive a need that will improve performance towards the organisational goals. Companies that implement training without a proper needs analysis are likely to conduct unfocussed training, resulting in unnecessary expenses. Let us look at needs at the three levels.

Training Needs at the Three Levels 1. When Do Organisation Training Needs Occur? To determine organisational training needs, the HRD department will have to study the organisational plans, goals, and strategies; make a human audit to determine how the human resource is aligned to the organisations goals; analyse the present performance data; check the labour supply market; and evaluate those areas that impede proper alignment between the organisation and its human resources. Employee morale deserves a special mention here. The HRD department will first evaluate the quality of work-life that determines morale. Some of the indices are employee turnover statistics, grievances, absenteeism, productivity, accidents, employee surveys, employee suggestions through formal processes, and union relations. Study of these give a clear indication of the employee health. The HRD department can evaluate how training can reduce any barriers to better employee morale. Often performance is improved with attitudinal training. Below is a list of occasions when training needs arise: l l l l l

Change in business strategy New products and services Conforming to laws and new legislation Turning competencies into currencies Employee morale

l l l l

Change in policies Introduction of new technology To gain a competitive edge Lack of qualified people in the labour market

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An important part of organisational training needs is the attitude of the organisation towards training. The HRD Manager needs to evaluate the following: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

Does the organisation have formal training policies? Does the organisation provide a training budget? Does the organisation demonstrate its support of training by creating facilities for it? Are line managers supporting training by releasing their staff for training? Many consider training as an intrusion into their operations. Do top management involve themselves in training? Do line managers identify training needs at the time of performance appraisal? Do line managers give feedback on performance improvements after training? Do line managers willingly build in-training budgets as part of their departmental budget? Are line managers willing to be trained to train? Do line managers spend an important part of their day in coaching? Is training a key result area for all managers?

Without organisational training support the training cause is surely doomed. As a matter of fact, the organisation’s performance is in jeopardy.

2. When Do Function/Department/Job Training Needs Occur? The following table (Table 6.1) is an example of when training is required in the department. It is broken into knowledge, skills, and attitude. TABLE 6.1 Knowledge, Skills, and Attitude

n n n n n n n

Knowledge Costs increase Supervisors doing lower jobs High waste Hygiene concerns More supervision required Customer loss Lack of concern for quality

n n n n n n n n n

Skills Drop in standards Management complaints Staff increase Drop in sales Productivity drop Inter-departmental complaints Delays in service New technology New Equipment

n n n n n n

Attitude Customer complaints In-fighting Absenteeism Shirking responsibility Falling morale Lack of teamwork

The operational departments in the hospitality industry have a few specific limitations that come in the way of training: 1. Service requires ‘warm bodies.’ It is difficult for departmental managers to release their staff when they are on duty. 2. The next best thing is to release them in their off-duty hours. Staff is loathe to spend their personal time on training.

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3. Service is often provided on the feet. It is physically exhausting. A room attendant or a receptionist, for example, would have been on her feet for a straight eight hours in her shift. Many are plain fatigued to attend training programmes. 4. The hospitality industry works on a three-shift system. A training programme that is held during the day puts the night shift at a disadvantage. The hotel industry has found the time between 3 p.m. and 6 p.m. as the ideal time that favour all shifts. It is also considered the lean time in business. Most restaurants are closed between lunch and dinner service. Many employees prefer to rest in preparation for the evening shift making afternoon training undesirable. 5. Because of the pace of on-going service, employees are often called away from training sessions to meet a guest need. 6. The most popular training method employed by the hospitality industry is on-the-job training. While it is an effective method, it is fraught with danger. Untrained staff is forced to face the customer and may damage customer relations due to lack of skills and knowledge. Moreover, valuable assets like crockery and glassware are likely to break through inexperience in handling them. Trainees pick up the wrong ways of doing things because of service expediency. Many are even misled by experienced people who have old ways of doing things. 7. Some line managers give negative vibes to training because of their preoccupation with service. These negative vibes are transferred to the employees who look upon training as a chore that will have no recognition from their line manager. 8. Because of the brisk pace of service, line managers find it difficult to spare time for coaching. The HRD Manager is challenged to balance the operational needs with training responsibilities. They resolve this challenge by the support of corporate policy making training mandatory. Some hotels have stipulated a minimum number of hours a year for training of each employee. Training is also made a key result area in each manager’s performance expectation.

3. When Do Individual Training Needs Occur? Individual training needs assessment addresses who needs training and in which area of performance. The best source to get individual training needs requirement is the performance appraisal format. We have learnt by now that a good appraisal system is also a developmental tool. The HRD Manager analyses each appraisal and lists the needs. Often, a number of employees have a common training need. This is ideal to build a programme around that need. An ideal group for a training programme is 15 participants. Others may have unique needs and may be sponsored to external programmes. Some line managers may find it difficult to determine a training programme to meet a need. They will then consult the HRD Manager to arrive at an acceptable training programme to solve a problem. Common training needs identified in the hospitality industry include: l l l l l l l l l

Lack of job knowledge New to the organisation Below standards Lack of customer focus Ready for higher responsibilities Career plan Lack of telephone skills Unable to make decisions Computer skills

l l l l l l l l

Under-confidence New to the job Too many mistakes Indisciplined Organisational/Departmental changes Succession plan Poor time management Poor sales skills

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Focussed Training Options Organisations take the responsibility of training to meet specific performance objectives. Organisations earlier allotted huge budgets to train employees. They did this because employees planned long careers with them. Today, the employee no longer gives that loyalty and is willing to change for better pay because of perceived short careers as the hospitality industry believes in youth. Hotels worldwide are opting for younger workforces to keep the organisation fresh and infused with new ideas. Hotels can also exploit the energy of the young for long hours of work. Organisations have now rationalised this approach and are now willing to invest in critical training that will directly affect immediate performance. Such soft skills include: l l l l l l l l l l

Customer Service Teamwork Productivity improvement Orientation of new hires Communication skills Leadership Product and Service knowledge Time Management Interviewing skills Sales skills

l l l l l l l l l l

Quality improvement Organisation wide technological changes Computer applications Technical training Supervisory Skills Performance Appraisal skills Problem Solving and Decision-making Train-the-trainer Presentation skills Coaching skills

Some new topics have been found relevant for inclusion in common training programmes: l l

l l

Change Management Managing Diversity (in multi-cultural workforces) Environmental Consciousness Gender Management (sexual harassment, working under women bosses, etc.)

l l l l l l

Health and Safety (laws and practices) Strategic Planning Ethics Personal well-being (yoga, meditation, aerobics) Managing the Boss New Technology training

Sources of Training Needs Assessment TABLE 6.2 Training Needs Assessment Sources Organisation Organisation goals and objectives Skills/Competency Inventories Organisational climate indices Performance data Technology changes System changes Management requests Exit interviews n

n

n

n

n n

n

n

n

n

n

Function/Job Job Descriptions Comparison of Work Analysis to performance Performance below standards Work Sampling Analysis of operating problems

n n n n n n

n

n

n

n

Individual Performance Appraisal data Work Sampling Counselling interviews Performance tests Attitude surveys Assessment Centres Critical Incidents Self-assessments

While most of the sources given in Table 6.2 are self explanatory, a few need further explanation:

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Skill/Competency Inventories A skill/competency inventory is a list (now on the computer) of skills/competencies possessed by each person in the organisation. The HRD department creates and maintains this list. This list deploys the human resources with a particular skill wherever a need is identified within the organisation. For example, if there is a need to explain a computer application to new entrants, the inventory throws up existing employees who are skilled in this activity. Furthermore, it also identifies those with the ability to train. That individual is then deployed to train the new recruits. The individual may be within a department where the need has arisen or from another department. A chain operation may use their skill inventories for cross country or cross continent training. Rather than hire an expensive expert from the market it is cheaper to deploy an internal resource. The information is gathered at the time of hiring, listing those unique skills brought into the organisation by new recruits; skills acquired in internal training programmes; and those skills transferred from external sources.

Organisation Climate Indices Climate refers to morale and motivation of the employees. This information is gathered by conducting attitude surveys of employees; employee suggestion box; exit interviews; and counselling interviews. The trainer may have to devise appropriate programmes if the morale is low.

Work Sampling This is studying performance in its natural surroundings or under controlled conditions. The purpose is to see what factors enhance performance and those that impede it. The HRD person can then redefine the job to make it more effective. For example, a hotel found that its room attendants were unable to complete the standard 16 rooms in the shift. By observing their performance in a work sampling exercise, they found that they spent a lot of valuable time supervising the maintenance engineer when he attends to a maintenance job in the room. Room attendants were told to be in charge of the rooms allotted to them and not let anyone enter unless under supervision. The HRD person studying the job made the floor supervisor responsible for supervising all maintenance jobs on the floor. By eliminating this task, the room attendants were now able to complete their 16 rooms.

Critical Incidents Critical Incidents are those ones-off occurrences that cause a major hiccup in the performance of a job. These incidents are studied to find the solution and ensure that they do not happen again. For example, a floor housekeeper of a resort property lost a master key. The hotel had to spend a considerable amount of money changing the locks of all guest rooms. On study, they found that the housekeeper kept the key in her pocket to seemingly safeguard the key from theft. The key was on a small key chain. She apparently forgot to return the key to the housekeeping control desk and gave her housekeeper’s cloak for washing to an external laundry. As a result of this incident the hotel made changes. They had a larger key ring which could not be put into a pocket, but instead, hung from a belt worn around the housekeeper’s waist. They also created a checklist for the control desk attendant, which included the taking over of the key when the housekeeper completed her shift. The changed Housekeeping procedure required training.

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5. TRAINING OBJECTIVES AND DESIGN Training Objectives Training objectives describe the desired performance objective that a trainee should have attained after the training. Obviously, it should be distinctly observable (like behaviour); and measurable (against standards). The advantages of setting objectives are: 1. 2. 3. 4. 5. 6.

The trainers can measure the trainees’ performance as well as their own effectiveness in training. The trainer can be more focussed on content and delivery during the programme. The trainee knows exactly what the outcome of the training session should be. It makes the trainer accountable for the outcome of the programme. It addresses the direct issues of the line function and the individual. There is a synchronicity between the trainer and trainee in what will be covered in the programme.

Examples of training objectives relevant to the hospitality industry are:

Observable Training Objectives l l l

The trainee will smile at guests in all circumstances. The receptionist will exhibit courtesy and manners to guests. The order-taker will be able to upsell room service food orders.

Measurable Training Objectives l l l l

The room attendant will be able to complete 16 rooms in a shift to international standards. The room service waiter will complete dinner service in 20 minutes. The plumber will replace a washer in 10 minutes. The cashier will be able to process a guest check-out in 5 minutes.

Training Design A precondition to any training programme is to know how people learn. The training programme must create conditions for learning. It must also take into account that the learners are adults and need a separate approach than children.

Preconditions for Learning Before a learner can benefit from any formal training, he/she must be trainable. This means that he/she must have both the ability to learn and the motivation to learn. Ability requires the learner to have the prerequisite knowledge and skills to assimilate and master what is being taught. Some trainers administer a performance test in writing and/or through work sample. The learner must have background knowledge of terms and processes before any further learning can take place. For example, there is no point in teaching a room service order-taker upselling skills when he/she does not know the rooms service menu. Sometimes, a trainer may incorporate a separate background training session to bring all trainees to the same level of understanding before proceeding with the main objective of the training. Trainers in

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the hospitality industry must be aware of the cognitive capability of employees at skilled and semi-skilled levels. There is also the issue of language. The English language is the popular medium of instruction, but not all may speak and read it fluently. Trainers may have to use interpreters to explain the programme as it unfolds. Learners must also possess the motivation to learn. Adult workers are only motivated if they see a direct relevance to their performance on the job. A way to determine this is to ask learners at the beginning of the programme what performance issues they want to resolve through the training programme. It is also important to ascertain their career goals. Adults want training programmes to meet that end. The trainer has to assess whether the training input meets the career goals of the individual. Sometimes, it requires thorough explanation to make the learner see the relevance of the input to their immediate performance capability and long term development. In other words, the trainer provides the learner a vision. Line supervisors must also give support and enthusiasm to the training effort. When a learner sees the enthusiasm of his or her supervisor towards what he/she is learning, then the motivation to learn increases. Another challenge is to get a complete synchronicity between the line supervisor’s way of doing things and what the trainer teaches. The belief in training falls flat when the trainee returns to the work place only to be told that he/she has been taught the wrong thing. Sometimes, the line manager needs to learn to do tasks the correct way.

Conditions for Learning A challenge to a trainer is to ensure that the training conditions are appropriate for learning to take place. Training conditions are those steps taken that ensure learning. Here are some of these conditions: 1. Learning takes place when there are no distractions. Many hotels create purpose-built training classrooms and laboratories to make training conducive. The rooms have the right sound proofing, lighting, seating, etc. It also gives the learners an indication as to the seriousness of the organisation towards training. 2. Complex tasks and information must be broken down into digestible chunks, so that each component is thoroughly understood before going to the next. Here, the task lists developed at the time of work analysis is useful as a training tool. 3. Learners like to practice skills and behaviours before they use them at the real work place. A waiter likes to lay out a dinner table with all the crockery, cutlery, glassware, and linen in a non-threatening situation and perfect that skill in the classroom before using it at the work place. Certain behaviours like telephone etiquettes can be practised in the classroom through role-play where the trainer acts as the customer. Practice sessions can be supported with either the demonstrations by experts like in cooking or video films to demonstrate actual situations. We have often heard the saying, “Practice makes perfect”. 4. Training must be focussed to the subject or task at hand. Many trainers tend to give more information than required. This can be confusing. Learners tend to show disinterest when the main subject is clouded by irrelevant information. 5. Trainers must encourage the learners to set goals of performance. Research has shown that goalsetting has led to an average increase of 19 per cent in performance. Goals help the learner (i) focus on performance behaviour that needs changing; (ii) the learner can measure his/her progress towards the goals that challenge him/her to attain them; (iii) the learner works towards doing better than the standard set for the task; (iv) the learner develops his/her own strategies to attain the goal.

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One laundry valet developed his own style to deliver guest laundry to rooms. He found that he made several trips to the floors to deliver the laundry by hand. He borrowed a trolley used to deliver hung uniforms to the uniform room from the laundry. He took all guest laundry in the trolley for a set of floors saving him the frequent trips. He was, therefore, able to service all rooms in one trip. The practice was adopted by the hotel. 6. Trainees need constant feedback on their progress. There is an element of ‘hand holding’ till they are confident to perform the task on their own. Constant feedback enables the learner to constantly evaluate his/her progress. They are able to correct themselves in a timely manner before they convert the action into practice. 7. Teaching materials must be interesting and colourful. Teaching can be done with plenty of pictures and diagrams. As the Chinese proverb says, ‘A picture speaks a thousand words.’ The use of training films has greatly made training interesting. Task oriented training sessions are the most interesting when the learner actually performs the task. The retention and motivation is very high. The use of examples from real life situations also encourages learning.

How People Learn? People learn through various stages. The ultimate objective for a learner is to attain mastery in a skill. They go through four stages of learning to achieve mastery as shown in Figure. 6.5. Unconscious Competence

Master

Conscious Competence

Trained Performer

Trainee

New Entrant

Conscious Incompetence Unconscious Incompetence

Mastery

Acquired Skill

Awareness

Ignorance

FIGURE 6.5 | Four Stages of Learning

Levels of Learning Unconscious Incompetence In this stage, a learner is unaware and unable to perform a task. This is applicable usually to raw recruits to a skill. Apprentices fall in this category and require motivation and confidence to proceed further. Conscious Incompetence In this stage, the learner has been made aware of the skill. This is acquired through knowledge instruction and demonstration where a concept is made clear. The learner is still unable to do the task. Conscious Competence This stage brings the learner to a degree of skill. This is achieved through demonstration and hands-on practice. There is a studied effort to perform the task.

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Unconscious Competence This stage is when the learner performs the tasks automatically just like walking, swimming, or driving. This is the stage of mastery.

Issues of Adult Learning At the workplace, adults get trained. There are serious statutory issues of hiring underage people. Training gets more challenging with a mature age group. They need special treatment and have to be addressed in different ways than teaching school or college kids. Let’s look at these challenges:

What is in it for me? This is the first question asked by adults. Adults look at training as a measure of improving their status or earning power. They evaluate training in terms of hard currency that will come to them. They also look at survival and see training as a way to prolong their career.

Life, Task, or Problem Centered Adults are motivated when they believe that the training is going to directly solve, or enhance some of their performance issues or life issues. They like to get to the point and are intolerant or bored with issues that do not directly concern them.

Management Commitment Adults first assess the importance given to training by the management. If management does not support training and the generation of new ideas, then training becomes a pastime rather than a vehicle for change.

Cost of Negligent Training The hotel and restaurant business is subject to many laws as they serve the public. There are laws concerning hygiene, sanitation, storage of food, safety, etc. The law prescribes training in these areas and insists on keeping records kept for the government inspectors to evaluate. Apart from the statutory requirement there is the aspect of not training. Staff can follow wrong practices that could result in asset losses, damages, litigations, deaths, fines, and even closure of the premises. Imagine the implications of wrong food storage resulting in food poisoning or misuse of inflammable material that can result in fire.

Diversity Modern workforces are multicultural. There are religious issues, language issues, perceptions, sexual preference, gender, socioeconomic backgrounds, literacy levels, learning styles, and backgrounds that have to be contended with in training. Pork is a taboo subject to Muslims, meat to vegetarians, hand gestures to others. A trainer has to take into account several nuances before going into training. This requires awareness and flexibility on part of the trainer.

Learning Disabilities Adults have visual, auditory, and kinesthetic disabilities. There are those who have difficulty in understanding the written word. They prefer diagrams, audio-visuals, illustrations, or role plays to learn. Some have difficulty in concepts and need to feel objects to learn. They learn better with demonstrations and hands-on training. There are still others who are not adept with their hands. They need plentiful practice.

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Ego Managing the egos of adult learners is a challenging issue. Adults do not like to lose face with others. They find it difficult to accept that they do not know. A trainer has to be tactful to deal with such situations. One method is by enabling adults towards self-discovery.

Developing Training Material We have discussed how it is important to set training objectives. This focusses training sessions into specific training outcomes. Once the objectives have been set, the next is to prepare the training materials. Training materials are those elements that will drive the training programme. The most important is a training manual which will guide a learner from session to session. The trainer will follow the manual throughout the programme. Typical components in a training manual are: l

l

l

l

l

l

l

l

Training Schedule explaining the topics of each session: An important part is the time period of each session as well as the timings of coffee breaks. A typical session should last 45 minutes. Studies show that the attention span of learners starts waning after 20 minutes. 45 minutes is ideal time to bring in interactive exercises to restore attention. Rules of the training session that explains the dos and don’ts during the session: Some rules are switching off mobile phones; what to do in the event of a fire; coffee and lunch breaks; no smoking; etc. Broad training objectives: The overall objectives of the training programme need to be set. They act as a beacon towards which lesson plans are directed. Learners see how each session connects to the broad objective. Instructional pages are those texts that are the foundation of the programme: They act as a fallback to learners after the training programme is over. They comprise the knowledge component of the programme just as textbooks are in school. Review quizzes are those practice sessions that assess how much of knowledge or skills have been understood and assimilated: These quizzes must be easy to administer and complete. The best are multiple choices, true or false, and fill in the blanks. Workbook for students to do their exercises: These are blank pages to make notes and/or directed pages with exercises for students to complete. Having them in the manual enables the learners to have a permanent record of their notes and performance in exercises. They will be able to note what they have learnt from the exercises. Case Studies and Handouts are additional material included based on the training methodology employed: If case studies are in the training plan, then the relevant case studies would be included in the manual. Feedback form: This is a questionnaire that directs learners to give their opinions on the effectiveness of the programme with suggestions for improvement.

Other training materials could be the tools used to execute exercises.

Lesson Plans The most crucial training document for the trainer is the Lesson Plan. The lesson plan ensures that the trainer has planned and prepared for each training session. It takes the trainer through each session very meticulously

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and logically ensuring that all the elements that compose a session are included. A lesson plan will have the following elements: l l

l

l

l

Learning objectives of the training session Time for each sub-session: A trainer is required to break each training session of 45 minutes into subsessions as we learnt that learning takes place when delivered in small chunks. A trainer is always limited by time and must ensure that all that has to be taught in a sub-session is within the time limits set. This is a tool to assist the trainer’s time management. Content is going to address ‘what is going to be taught’. It is the main body of learning that is broken into sub-sessions. Training Methodology addresses the issue of ‘how a session is going to be taught.’ The trainer can choose from an array of training methodologies (discussed later) and show his/her creativity with how she uses various methods to keep the interest alive. Remember that just lectures in themselves are most boring and least effective! Training Aids are the tools required to execute a training methodology.

A typical lesson plan will look like the one shown in Figure 6.6: Customer Service Programme Day 1 Lesson Plan Learning Objective: Trainees will understand customer Service and be able to handle difficult customers. Time

Content

Training Methodology

9 a.m.–10. 30 a.m.

Welcome, introductions, and explanation of rules

Pairing exercise

10.30 a.m.–10.45 a.m.

Coffee break

10.45 a.m.–12.15 a.m.

What is Customer Service?

Training Aid l l

Lecture and Discussion

l l

12.15 a.m.–1 p.m.

Understanding Customer Service

Show training film— ‘The Customer and You’

l l l l

1 p.m.–2 p.m.

Lunch

2 p.m.–3.30 p.m.

Managing Difficult Customers

3.30 p.m.–3.45 p.m.

Coffee Break

3.45 p.m.–5.00 p.m.

Managing Difficult Customers

FIGURE 6.6 | Lesson Plan

Show Training Film— ‘Managing Difficult Customers’

Role Play

Training manual Code of conduct handout

Training Manual White Board T.V. C.D. Player Training Film White board for noting discussion

l

T.V. C.D. Player Training Film White board for noting

l

Flip Chart Board

l l l

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Transfer of Learning The goal of any training is that the trainee will transfer what is learnt in the classroom to the work place. Actual improvement of performance is the true test of a training session. To ensure that this does take place, there are certain conditions in the training session that ensure that: 1. There must be a close synchronicity of the training session with the actual workplace. 2. Examples cited in training must be from the real world. 3. Trainees must articulate their expectations of the training session at the beginning of the session. Most want to solve real problems they face. 4. Training sessions must incorporate role-play to change behaviour and provide practice in changing skills. 5. Simulate as many situations as possible from the real work situation. 6. Use training methodology that increases the chances of retention and learning. 7. Ensure that the main features of the training session are thoroughly understood. 8. Get trainees to list action plans for transfer of learning. 9. Invite the line manager/(s) on last day to inform what has been learnt and what will be transferred. It is important to get their buy-in, otherwise the skills and competencies learnt will fall flat. Share the trainee action plans with the line manager/(s). Also share the anticipated difficulties expressed by trainees to demonstrate their new skills and competencies at the work place. 10. Once back, trainees must be provided opportunities to demonstrate their new skills and competencies. 11. Conduct a review/refresher programme after a few weeks to learn the difficulties trainees encountered in transferring their knowledge. They may need new knowledge and skills or practice again. Sometimes, it is convenient for trainees to relapse into old ways. This is especially when the skills and competencies involve high risk.

6. TRAINING METHODOLOGY The training methodology used is the key to the learning process. It is the process used to convey information. The wrong choice of methodology could make learning difficult. However, it must be understood that there are two purposes of training methodology: 1. Those that convey knowledge and information, and 2. Those that are experiential which are interactive to develop skills and attitudes. As a guideline, the following graph (Figure 6.7) indicates the effectiveness of methodology in terms of retention after three days. Informational methods are used to teach factual material, and in some cases, demonstrate skills and attitudes. They do not require the trainee to actually experience or practice the material taught during the training session. Experiential methods, on the other hand, are more interactive where trainees practice and learn generating knowledge and feelings. The diagram above shows how much information a person retains after three days since receiving the information. Any methodology that uses the auditory function only is the weakest. The lecture method, therefore, is the poorest form of ensuring learning. Ironically, it is the one most used. By bringing in visuals like graphs, pictures, etc. we enhance the retention level to about forty per cent after three days when we hear and see. However, when we see others doing a task, the retention is greatly enhanced to sixty per cent. Methodologies that employ demonstrations or movies that show the performance

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of tasks are greatly effective. The best level for ensuring retention is when we do tasks ourselves. Practical training and on-the-job training have got their popularity on this account. 80% When We Do Ourselves (Interactive) 60% When We See Others Doing (Knowledge and Information) 40% When We See (Knowledge and Information) 20% When We Hear (Knowledge and Information)

FIGURE 6.7 | Knowledge Retention Graph The (Table 6.3) below gives the complete range of training methodologies available. They have been listed according to where they are most effective in terms of conveying knowledge, skills, or attitudes. TABLE 6.3 Knowledge, Skills, and Attitude

n n n n n n n n n n n n n n n n

Knowledge Lecture E-learning Tutoring Symposium Seminar Programmed Instruction Independent Study Group Discussions Case Study Projects Audio-Visual Methods Conferences Field Trip Brainstorming Guided Discussion Research and Library Work

n n n n n n n n n n n n n

Training Methodologies A thumbnail sketch of each will be useful.

Skills On-the-job training Role-Playing Management Games Transactional Analysis Communication Exercises In-basket Exercise Demonstrations Interactive Video Workshops Coaching Incident Method Field Projects Simulation

n n n n n

Attitude Sensitivity Training Fish Bowl Exercise Transcendental Meditation Mentoring Performance Counselling

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Methodologies to transfer KNOWLEDGE Lectures are given when knowledge is imparted to a large body of people. It requires an expert on a subject who needs little time to be able to talk. The challenge is to get the attention of listeners. It costs least. Learners are passive listeners who gain knowledge based on the lecturer’s ability to make the lecture interesting. It is not directed to individual learners, but is broad based for all. E-Learning is when knowledge is transferred through the computer. The material is developed by experts who have no direct contact with the learners. The learners have the benefit of learning at their pace but are unable to seek clarifications immediately. While it is interactive with a computer screen, it is still a ‘lonely’ way of learning not having the advantage of the knowledge and experiences of others when in a classroom. It is not useful in training in interpersonal skills and psychomotor functions. It is expensive and convenient. Tutoring is knowledge shared by an expert with a learner, on a one-to-one basis. This method is more effective than a lecture, but will need the dedicated time of a trainer to one person. This is effective when there are few learners to be taught. Symposium is a meeting of experts on a particular subject. The participants are passive as they watch the experts exchange their views. It is best used to acquire advanced knowledge on a subject. Seminars are conducted when a group of advanced students want to learn a specific subject. Experts on the subject give presentations on the subject, followed by an interactive question and answer session with participants. Programmed Instruction is one in which a learner studies a manual presented in modules (or installments) followed by quizzes to establish the proficiency in that module. Several modules lead to a complete subject. This is a self-study done through distance education. Group discussions get together groups of learners (maximum 15) to discuss a subject. The benefit is that students are exposed to facets of the topic that they may have overlooked or not visited. Case Study is a group discussion of a real life situation. Learners get the background of the case and work towards finding a solution to the problems. This method remains academic and does not solve problems in the real workplace. It develops decision-making skills, analytical skills, and communication skills, and generates a number of solutions. While most have no right or wrong answers, the focus is on the logical way decisions are arrived at. Projects are academic exercises that encourage learners to make a report on a subject. This method encourages research, project implementation, and report writing. Audio-visual methods include training films, slides, transparencies, etc. Students comment on the displayed visual. It allows for replays, but is expensive to possess. Sometimes, films are alien to local circumstances. Some films may need translated versions to cut across language barriers. The American Hotel and Lodging Association has excellent training films for the hospitality sector which show tasks without a language script. Local instructors can develop their own scripts in the native language to adapt to the action on the screen.

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Conferences are larger occasions when noted experts are called to give inputs on a subject or theme to learners studying or practicing the chosen subject. The conferences have a plenary session that includes everybody, followed by smaller groups which discuss issues to solve specific problems. Field Trips are used to expose learners to locations which cannot be reproduced in a classroom. For example, learners may visit other hotels and restaurants followed by a debriefing session in the classroom. Brainstorming is used by people, qualified on a subject, to solve specific problems. Guided discussion is one where a facilitator leads a discussion to cover pre-arranged issues of learning.

Methodologies to Impart SKILLS On-the-job Training is placing learners in live situations to learn from an assigned coach or against specified tasks. This is the most popular method used in hotels and restaurants and is most effective. The only disadvantage is that trainees may pick up the wrong ways of doing things and may make mistakes, which may be costly in terms of money and customer goodwill. They may also come in the way of busy workers who are concerned with their actual operational performance rather than teaching. Role Play: It is best used for behavioural training. The learners become the “actors” who are required to act out a scene presented by the trainer. A good use of this method is in developing customer service skills. Its costs are negligible and done with a lot of fun. Sometimes in the fun, the trainees may lose out in the lessons learnt. The trainer will have to focus them back on the learning gained. The motivation to learn is very high. Some trainers record a role-play to playback for analysis. Trainees learn from others, but are involved, active learning. Trainees, however, are shy and self-conscious to act and will need a lot of persuasion to come up-front. Management Games are used to simulate management situations in a study situation. Team building simulations are a good example. Transactional Analysis is an effective method to improve interactions between people. It works on three ego states of Parent, Adult, and Child. Each individual is required to respond to the appropriate ego state in given situations to make the transaction effective. Communication Exercises are designed to illustrate barriers in interpersonal communication. This could be in the form of Chinese Whispers to illustrate the distortion of communication when it passes through many people. In-basket Exercises are problem-solving exercises with current live problems of an organisation. These problems are tested in the classroom without fear of wrong decisions. Demonstrations are actual performances of tasks by an instructor to a learner or a body of learners who watch, but do not participate in the task. The benefit of this method is that learners get to see the actual task, which improves their learning considerably. Cooking demonstrations are a good example.

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Interactive Videos/CDs are used for self-study. Learners respond to questions after a body of instruction presented in parts. The benefit of this method is that situations in a video/CD are dramatised to give a more effective learning. Workshops are meetings by groups to solve actual problems. Coaching is done by an instructor, on a one-to-one basis, either at the workplace or outside the work area. This is best used for skill development. Incident Method is to train learners in problem solving and decision-making by providing information on an incident in phases. Decisions keep changing with new additional information. Field Projects are real research studies of real work places. A trip to a brewery or a vineyard would be a field trip. Simulation Exercises are computer-aided methods to give the individual a virtual reality of a situation. The best known example of this method is when pilots are in cockpit simulators. It is very effective in the transfer of knowledge and skills. This is a very expensive method and has not reached the hospitality industry as yet. Other forms of simulation are games and exercises used in a classroom environment. They are effective in terms of learner involvement with a lot of fun and good transfer of learning. The result of bad performance does not affect real operations and is indicative of a shortcoming. It takes time and is expensive to develop. Coaching has become a popular methodology nowadays because it is done on the job. The coach demonstrates a skill and lets the employee practise it. Naturally, each sub-task of an activity is dealt with in digestible chunks so that the learner understands fully the sub-task before proceeding to the next one. HRD train managers and supervisors with coaching skills as an essential skill to propagate training at work.

Methodologies to Develop ATTITUDES Sensitivity Training is a method of dealing with real feelings. The instructor has to be specially trained in this methodology to deal with human sensitivity. The learner goes through three phases of unfreezing, exploration, and freezing of attitudes. It improves self-concept, reduces prejudices, and brings about real change in interpersonal behaviours. Fish Bowl Exercises deal with the actual feelings of work groups towards each other. This methodology is ideal for building teams. Meditation is a method of learning to improve concentration and managing stress, towards a total well-being. It too requires a trained person to administer this method, but once learnt it can be applied at any convenient time. Mentoring is a process of assigning an elder and experienced person in an organisation to a new recruit. His or her role would be to lead the learner through the cultural, political, and performance aspects in the organisation. The mentor is someone who does not evaluate the learner’s performance or has a say in his or her salaries, benefits, and promotions. This ensures objectivity in dealing with the learner. Performance Counseling is a method borrowed from sports training to give learners the right attitudes to excel through inspirational talks.

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If we are to analyse the methodologies, we can see that the ones that ensure 80 per cent learning after three days are on-the-job training, coaching, sensitivity training, fish bowl, transactional analysis, and meditation. The most practical methodologies for skill training at normal workplaces are on-the-job training, role-play, and coaching. Performance counselling is the best way to develop attitudes. Knowledge is best developed through projects, exercises, demonstrations, audio-visual methods, and workshops. Knowledge must relate directly to work performance to sustain the motivation to learn.

7. TRAINING AIDS There are many training aids to assist in learning. For a long time, the chalkboard was used as the only aid in teaching. Projection equipments were rare and expensive. Whiteboards, with non-permanent marker pens, replaced chalkboards as a cleaner and more efficient method of teaching. The 80s saw the emergence of the overhead projector, which became the standard equipment in most training classrooms. The OHP brought a new interest to see written material and diagrams clearly. The OHP uses transparencies that give better reproduction of information. Projectors were supported by Flip Chart boards and chalkboards. Today, the laptop computers with Microsoft PowerPoint software have made presentations colourful, picturesque, and innovative. Laptop presentations are projected through an LCD projector, which is presently expensive. Soon, technology will make them cheaper and replace them with innovative inventions. The whiteboard for instance, has witnessed a revolution. We can take copies from these boards or transfer information to computers.

Projection Equipment l l l l l l l l

LCD Projector Overhead projector Slide carousal 35mm film projector Epidiascope Laptop computers Television CD/VCD players

Motion Picture Media l l l l

Compact Discs (CDs) Videos 35mm movies Film loops

Personalised Multimedia Systems l l l l l

Interactive CDs and videos Video cameras E-learning Instructional kits Tape recorders

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Accessories l l l l l l l l l l l l l l l l l l l l l l

Pointers—steel and laser Oil-based and water-based marker pens Transparencies Audio and Video cassettes Connecting cables Graph and Chart papers Screens Flip chart stand Projection trolleys Training Software Real objects Cutaways Models Whiteboards Posters Charts Flip Charts Graphs Pasteboards Pointers Handouts Training manuals

8. THE TRAINER The trainer is a very special person as he or she influences the learners in a very special way. They are experienced success stories in an organisation, who reflect all that is good about the organisation. He/She is a role model that everyone respects and the learner looks up to. He/She loves to teach and has the patience to see the slow and painful process of change of the learner. He/She has exceptional communication skills with perhaps a sense of humour. While these are noble qualities of a trainer, there are other important qualities that are essential. l l l l l l l l l l l l

Industry awareness Leadership skills Interpersonal skills Technological awareness Problem solving skills Systems thinking Personal competence Discipline Training skills Care for people Negotiating skills Consulting skills

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9. MANAGEMENT TRAINING AND DEVELOPMENT Management training and development is a composite of two independent HRD drives—management training and management development. Let’s look at them independently:

Management Training Management training in the hospitality industry connotes the captive supply of qualified management personnel at the management entry levels. A typical management structure of a hotel has the following levels as shown in Figure 6.8: General Manager

Head of Department

Assistant Head of Department

Assistant Manager Management Entry Levels

Executives/Officers

FIGURE 6.8 | Management Structure of a Hotel Captive management training supply is subject to two important factors: 1. The hotel has a high attrition rate at management level that justifies constant supply. 2. The hotel/chain is growing and will be able to accommodate and provide management careers.

Candidates for Management Training Programmes As one can see in the diagram above, the management entry levels are at the executive/officer level or the assistant manager level. The candidates that enter the management training programme are from two sources— internal and external sources. Candidates from internal sources are those deserving supervisors who have shown potential to enter the management cadre. They have already acquired excellent technical skills and now need good management orientation. Candidates from external sources are from hotel schools, graduates from any discipline, and working professionals from the hotel industry who have aspirations into management. Hotel school students and graduates are recruited through in-campus placement programmes. The placement officer of the educational institute informs hotels of the placement season which is closer to the graduation year. Hotels make presentations of their property/chain and organise their selection procedures in time slots allotted to them.

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Type Duration for Management Training The time period of management training programmes ranges from 18 months to two years based on the ability of students. Hotel school students, for instance, have already gone through three years rigourous hospitality education, and only need an orientation to the hotel processes and culture. They may need lesser time than plain graduates who are new to the industry.

Components of Management Training A typical management training programme has three essential components—classroom theory, practical training, and on-the-job rotation training.

Classroom Theory consists of hotel subjects (front-office management, food and beverage management, F&B controls, Food Production theory, housekeeping, etc.); management inputs (Finance and Accounting, Human Resources, Management Principles, etc.); communications (foreign language, business communications, interpersonal communications); engineering (hotel engineering, facility planning, blue-print drawing); law (labour laws, health and safety laws, hotel laws); and computer applications. Practical Training consists of in-class demonstrations and practice in lab kitchens, lab restaurants, and mock guest rooms. Here, students put their theory into practice in simulated conditions. Hospitality is a hands-on business and the progress of management is based on their proficiency at hotel skills. Managers will earn respect when they are able to lead by example. While most managers will not cook or make a bed, they are supposed to roll up their sleeves and perform some tasks in times of pressure. Trainees develop skills important to the industry in these sessions. The practical training includes food preparation (usually French classical cooking); food and beverage service; guest room preparation; self development (telephone manners, interpersonal communication, business communication, public speaking, meetings, case-studies, etc.). On-the-job Rotation makes it essential for all trainees to rotate through all job positions in each department. There are several advantages to this approach: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14.

Trainees get a chance to put their theory into practice in actual situations. Trainees understand the dynamics of real life situations. Trainees get a chance to make contact with customers. Trainees appreciate the pressures and concerns of each level. Trainees perform tasks under time pressures. Trainees work in a team and understand their unique concerns. Trainees get to use some equipment not found in classrooms. Trainees learn the hotel systems and procedures. Trainees gain respect for each position and what they contribute to organisation goals. Trainees understand the conditions under which each job position works (heat, cold, physical strain, etc.). Trainees understand customer needs and behaviour in various circumstances. Trainees understand the role of external contractors and suppliers. Trainees develop internal networks of cooperation and support for the future. Trainees perfect skills already learnt, from practicing professionals.

The combination of all these inputs makes a good hotel manager. There is another aspect of being a hospitality professional that is not taught in a classroom but imbibed as a way of life. Management trainers

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continuously re inforce the need for self-discipline, the joy of service, the hunger for more knowledge, the urge for healthy competition, innovation and continuous improvement, supreme computer proficiency, and maintaining a healthy body and mind.

Facilities for a Management Training Programme A professional management training programme will need the following basic training facilities: l l l l l l l l

A well-equipped training laboratory kitchen A training restaurant with a mock bar A mock guest room Classroom/(s) Language laboratory Library Locker room with bathing facilities Administrative office (with meeting rooms)

Hotels have the advantage of assigning a satellite kitchen not in use during the day; a restaurant and bar closed in between shifts; and a guest room not in use for practical training should be held within the premises. Trainees are also required to eat the food they prepare and serve it in the mock restaurant to the faculty and official guests. The basic faculty required to hold a management training programme is: l l l l l l l

Management trainer who takes management classes and doubles as administrator of the facility Finance and accounting instructor who doubles as the accountant of the facility Chef Instructor F&B Service instructor Housekeeping instructor Engineering instructor Office coordinator-cum-librarian

The facility can hire part-time specialists like language instructor, architect for blue-print reading, law instructor, etc. Many line managers volunteer to teach also.

Management Development Management development activity is meant for existing managers who have shown potential for further responsibilities and are in the career development and succession planning programmes (see Chapter 7, “Career Development and Succession Planning” for details). The training programmes selected are carefully designed to give inputs necessary at the next stage of development. Typical topics include: l l l l l l l

Advanced Leadership Coaching skills Performance appraisal for high performance teams and individuals Business planning and developing strategies Organisational Behaviour Union Management Resource Management and Controls

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l l l

Problem-solving and Decision-making Management by Objectives Conflict Resolution

Future development programmes will include: l l l l l

Managing Knowledge Workers Working in a De-layered structure Advanced Financial Management Developing Flexible Workforces Developing High Performance teams

Development programmes are planned in advance using external specialists on the subject. These programmes are mandatory for those selected to attend the programme.

10. EVALUATION OF TRAINING Evaluation of training is the systematic assessment of whether the training has been effective in terms of return on investment and time spent. It answers several questions such as whether: l l l l l l l l l l l l l

It has contributed to individual performance Trainees have learnt Trainees have been able to transfer their knowledge, skills, and attitudes to the workplace Supervisors and managers see the benefits to improve their operations Training methodologies have been effective The human capital has increased its value to the organisation There is knowledge capital within the organisation Human capabilities are able to respond to changes in business strategy Training is cost effective The morale of employees is high Employees believe that the training has been an asset to them It has created a competitive advantage Training has developed an image and reputation of quality in the society to attract the best talent.

Evaluation Methods In order to answer these questions the training evaluation adopts the following measures:

Trainee Feedback This method assesses whether the training has been useful to improve the knowledge skills and attitudes of employees. Trainee feedback is obtained through a questionnaire at the end of the training programme. Trainees are given ample time to fill the questionnaire. Typical issues that are evinced in the questionnaire are: l l l l

Relevance of the subject to the employees’ work. The value of the contents to personal growth, i.e. subject matter and contents The time spent on topics—some topics need more time and some need less The most valuable topics and the least valuable ones

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The trainer’s style and presentation The materials used for training The training methodologies employed The training environment—lighting, climate control, seating, breaks, etc. The knowledge and skills that the learners will employ at their workplace.

The trainer will use this feedback with several objectives in mind: 1. To improve the effectiveness of the programme 2. To assess the level of satisfaction of the trainees 3. To make the programme respond to real work requirements more effectively.

Level of Learning Every training programme desires that trainees have, in fact, learnt, adding to the organisation’s knowledge capital. Level of learning measures the degree to which trainees have mastered the concepts, knowledge, and skills taught in a training programme. Learning can be evaluated through paper-and-pencil tests (for knowledge inputs); performance tests (for skills); and simulation exercises (for concepts and attitudes). All tests must directly relate to what has been taught in the training programme. Measurements can be made by testing the trainee before a training session and after, to record the change that has taken place.

Changes in Performance Training programmes also desire improvements in performance in relation to performance standards. Performance is evaluated by the performance appraisal system which throws up training needs. It is the direct supervisors who assess changes in performance after training. The appraisal after the programme will evaluate whether the need has been satisfied. It must be remembered that skills practiced under simulated conditions may alter when real life influences affect performance. Such influences must be identified in the appraisal interview before a measurement is confirmed. For example, a room service waiter may be trained to provide morning tea service within 5 minutes. But what if there is a shortage of crockery and cutlery in the department? The waiter may have to wait for another tray from the guest room to provide this service. His productivity is, therefore, stunted by extraneous factors.

Organisational Results The purpose of this method is to evaluate the impact of training on the organisation. This is reflected in sales turnover, cost effectiveness, less waste, competitive advantage, absenteeism, productivity, guest complaints, grievances, and customer satisfaction. Again, measurement is done by comparing past performance with performance after training. The trainer will have to relate training to the improvements. While this may be difficult to do at individual levels, it is possible when large bodies of people are involved. For example, if there were guest complaints from a particular restaurant, the reduction of it after the whole restaurant was trained has a direct impact on the contribution of training. Sometimes, the organisation may commission organisation-wide training in customer service. The results can be directly attributed to training.

Return on Investment ROI is measured in monetary terms, i.e. benefits of training minus the costs of training, expressed as a percentage. Let us look at the costs of training:

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l l l l

l l l l

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The opportunity cost of a trainee’s time away from work The salaries and wages of the training department Specialist fees of external trainers One-time capital costs of physical premises (classrooms, laboratories, etc.), training equipment, audiovisual, and computer software, etc. Running costs of utilities, hiring of equipment, stationery, and other supplies. Cost of surveys (customer satisfaction, employee satisfaction, performance, etc.) Programme costs of manuals, training accessories, handouts, meals, etc. Travelling costs of trainers and trainees if the programme is outstation. Such costs include travel fares, local transportation, board and lodging, incidental expenses, etc. Chain operations often have central training.

These costs have now to be compared to the benefits the organisation has derived. It is measured by the following formula:

ROI% =

Net organisation benefit × 100 Training costs

While net organisation benefit is difficult to evaluate, the organisation uses the indicators of sales turnover, repeat customers, morale index, absenteeism, etc. to give numerical interpretation to organisation benefit.

Other Evaluation Methods 1. Pre and Post Test Measurement Another way to measure the impact of training is to evaluate performance before and after training of an individual or a group. This is simply quantified by comparing the effectiveness or contribution to sales, department costs, or customer satisfaction, etc. before and after training. Any change can be directly attributed to training. Formula: Change in Performance after Training – Original Performance = Benefit of Training

2. Trained-Untrained Measurement An alternate way is to compare the performance and behaviour of a trained team with another untrained team. The assumption here is that the conditions of performance remain exactly the same. The measures used are also the same. For example, if we have Team A who is trained and Team B who is untrained, and we use the measure of sales dollars generated, then the difference can be the benefit of training. Formula: Team A performance measure A Team B performance measure B Measure A – Measure B = Benefit of training

3. Control Group Measurement Another powerful method of comparing performance is to select the dream team who provide the desired performance standards. Then, Team A which is trained, may be compared with the dream team performance. The difference is the improvement by training.

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Formula: Dream Team measure Team A measure Dream Team Measure – Team A Measure = Improvement by Training

4. Benchmarking The training department can benchmark its performance with the best in the industry. They would compare their performance on the following criteria: l l l l l l l l l l l l l l l

Percentage of training activities compared to the payroll Percentage of people trained to the total number of employees Ratio of in-house programmes to external programmes Average training hours per employee Training dollars per employee Ratio of employees trained per 1000 employees Cost savings as a ratio of training expenses Training cost per employee Percentage of positive ratings Number of training programmes held Increase in performance as a result of training Employee morale index Demand for repeat programmes Training budget Ratio of trainers’ salaries versus number of programmes generated

A comparison with the best in the industry is a guideline of success and not an end in itself.

Summary Training and development has become vital in the hospitality industry to attain a competitive advantage and also for survival. It is the responsibility of all the management. While training leads to changes in work performance, development is the improvement of the human potential. They benefit both the individual and the organisation towards mutual growth. The training process is a commitment of the organisation that is enunciated through progressive policies and procedures. Training inputs are provided after a precise training needs analysis from various sources. From these needs, purposeful training objects are set and designed, keeping in mind how people learn and the issues of adult learning. Training sessions are supported by training manuals, lesson plans and training aids. Training sessions also utilise the most effective training methodology for the transfer of learning. There are large investments in management training (supplying qualified numbers to an expanding organisation) and development (improvement of the human capital) for higher responsibilities. Training is evaluated for its effectiveness at various stages to improve performance.

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Key Terms Training

Development Education Continuous Education Training Methodology Training Aids Trainer

The learning process in which an employee acquires the knowledge, skills, and attitudes that lead to changes in behaviour to meet some Performance objectives The continuous improvement of human capital Learning that contributes to total life growth Process of upgrading one’s knowledge periodically The way information is imparted Equipment and accessories required to impart knowledge and skills Specialist who imparts training

Review Quiz Short Notes 1. 2. 3. 4. 5.

What is the difference between training, development, and education? Why do organisations train? Give the organisational and individual viewpoints on training. Explain the Training Process. Write short notes on the following: (a) Advantages of setting objectives (b) Goals of performance (c) Issues of Adult Learning (d) Transfer of learning 6. How do people learn?

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7 Career Development and Succession Planning 1. OVERVIEW Historically, organisations have placed a lot of importance on employee loyalty to the organisation. They hired employees offering a ‘cradle to the grave’ policy. It simply meant that organisations offered long-term careers and expected employees to pledge their lifelong loyalty to them. Organisations gave perks and benefits to meet every need of the individual. They provided housing, transport, medical benefits, educational grants, loans, etc. to secure the employee’s loyalty. They, in a way, ‘bought off’ the individual. Candidates competed hard to enter such organisations because they knew that the lives would be taken care of. There was tremendous job security. Even mediocre performance was tolerated as long as employees were loyal. Career choices were made when individuals were young (at the time of entry into a career). Some were lucky to have their choice of career that matched their personality traits and temperament. Others somehow ‘fell’ into a career. The belief was that once a choice was made, the career was irreversible. The career was an upward movement in the organisation characterised by earning more money, status, power, and security. To illustrate the mood, one organisation had monogrammed towels of senior executives in the exclusive washroom for them. Every young entrant aspired to have their monogrammed towel one day, perhaps towards the end of their career. One great benefit to the individual was that the organisation invested greatly in their training and development. While there was no such label as career development, people grew on the basis of seniority. Their length of service in the organisation was the criterion for advancement in the organisation. People reached senior positions at the end of their career. They were wise and grey haired and respected for their knowledge and experience with the organisation. Old age was recognised as a sign of experience and wisdom. They had shown their loyalty and that needed to be rewarded. Employees who showed disloyalty were summarily discharged as traitors to the organisation. Career Development later (in the 80s) became a formal process based on what already existed. The inputs required to reach various milestones in a career span were now planned. Every milestone was time bound and had to ensure a minimum level of knowledge and experience to be ready for consideration for the next milestone. We must remember that the post-industrial revolution organisation was strictly hierarchical having several layers of management, supervisory, skilled, semi-skilled, and unskilled workers. Within each band were several grades to climb with exceptional performance and contributions. Some organisations deliberately

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created this hierarchy to be able to give employees advancements within level bands. These milestones were in the form of change of salary grades or job designations. People jumped a grade level when they were taking up significantly higher responsibilities. Many bureaucratic organisations may still adopt such practices. The career plans still believed in the ‘cradle to grave’ policy.

Careers in the 21st Century The information age has brought a sea change in the way people look at careers. The ability to sell products and services across geographical boundaries with the aid of cyberspace creates global markets. Organisations are suddenly faced with competition worldwide with products and services that are of better quality and cheaper in price. The career of the 21st century is measured by continuous learning and identity changes rather than by chronological age and life stages. With downsizing, delayering, right-sizing, restructuring, and layoffs the employee sees very short career spans with an organisation. They are forced to re-engineer themselves in different roles by the time they reach middle age. Here are some examples that illustrate the point: l

l

l

An Executive Chef of a prominent chain started a culinary school. He was no longer a gourmet cook but the administrator of an educational institution requiring additional and diverse skills. A Food and Beverage Manager gave up his career at the age of 40 years and opened a banquet hall. He became an entrepreneur catering to a niche market. An HR Executive was laid off due to cuts in salaries and structures and started her own Recruitment Agency operating from home. She supplied human resources to her old hotel.

Modern Perspectives on Careers Today, we have careers without borders. It means that individuals can change careers easily. To do this, individuals continuously learn as their career goals keep shifting. Many individuals have made career corrections too. Some may enter into a career through parental pressures, but soon find out that they have to compete with those who had made that career as their first natural choice. They are unable to compete on equal ground. They make career changes mid-way to align closely to their career of choice. For example, many hotel school graduates do not enter the hospitality industry. They find that they made the wrong choice, but had to complete that course due to personal reasons. They then enrol in other courses of their choice. A housekeeper opened a coaching school for those entering competitive examinations. A Guest Relations Executive became a T.V. Presenter. There are many reasons for these dramatic changes in the 21 st century: 1. Organisational careers are unreliable and short. This happens due to several reasons beyond organisational control. Market dynamics are forcing traditional giants to make incredible decisions that were unthinkable before. Such decisions include: l Downsizing—reducing the workforce numbers resulting in reduction of jobs. l Delayering—breaking down a hierarchical organisation structure to a few levels only. This creates a flatter structure where traditional layers of management control are removed to bring more direct management control. There is more delegation and empowerment at lower levels. l Decentralisation—the breaking down of central control into smaller self-governed units. Hotels in a chain are an example. Team-building is an important training strategy to integrate segmented units. l Acquisitions and Mergers—Acquisition is when another company buys control of the organisation resulting in new management and ways of running business. It can lead to job

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2. 3.

4.

5.

replacements by the induction of the new parent company employees. Alternatively, the organisation may acquire another company and have to integrate the employees of the new company into the old one. Mergers are when two companies become one controlled by a holding company. These business alignments bring about changes in jobs and careers. Many lose their jobs in such strategies, while others have to re-learn the work style of the new organisation. They have to adapt to the employees of the other organisation, which is often not easy. l Reorganisation—This is when the organisation is refocussing on new business strategies, products, and services. Here, some core competencies are replaced by new ones. l Technological changes—These happen when organisations introduce new technology like computerisation or process equipment to bring in better efficiency. Due to this certain jobs are made redundant as technology takes over. There are many new specialisations and disciplines opened that were not there a decade ago. Who had heard earlier of nanotechnology, film animation, bio-technology, space astronomy, etc. Continuous education has become a way of life for survival in a changing world. Educational institutions now admit students of any age. In the west, many mature students, some with families, are empowering themselves with new qualifications quite unrelated with their first career, as they make mid-career changes. Cyberspace has spawned many careers. Many, like the HR executive mentioned earlier, who became a recruitment agent, has built her website and become her own master from home. All she needed was a computer that connected her business onto the net. Youth have become knowledgeable at a young age. They are in the know-how of world dynamics to make seemingly bizarre career choices. One girl had a hobby of astronomy. She had her own collection of telescopes and knew the sky by heart while in high school. She believed that she could be a NASA space explorer. Her parents who were financing her higher education would have none of that because they did not understand this new career. She is presently doing her Computer Sciences, but pledges to pursue astronomy once she is independent.

Youth are no longer looking for status, power, and prestige in an organisation because they possess knowledge power. They master their sphere of talent. The fun they get out of their chosen career is more important to them than organisational power and glory. We have read of IT software programmers who are quite happy to live in jeans and maintain a modest lifestyle in pursuit of their thrill of creating new programmes. An MBA graduate chucked a promising career in business management to own a small recording studio. He had studied recording software while doing his MBA. His income is erratic, but his motivation and thrill is enormous. Both the organisation and individual look at careers from different perspectives. Let us examine each.

Modern Organisation’s Perspectives on Careers 1. Nowadays, organisations cannot afford to carry non-performers. The ‘cradle to the grave’ policy is no longer tenable. Competency has replaced loyalty. People with the latest skills easily replace those that have become obsolete. 2. Organisations now prefer youth for several reasons: (a) The energy and enthusiasm of youth is essential to keep a competitive advantage. (b) They are easily moulded to organisation’s needs; older people are generally less flexible. (c) They come with the latest knowledge and skills from university and are always researching new ways of doing things. Obsolescence is a fear that organisations cannot afford to have. They have to constantly update themselves with the latest products, services, and practices.

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4.

5.

6.

7.

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(d) Youth have the energy and stamina to work for many hours, particularly in the service industry. (e) Youth are ambitious and will go that extra mile and take risks to meet their career goals. Organisations do not believe in spending large sums to develop people with the fear that they will leave in an extremely mobile market once they acquire additional skills. Budgets for training and development are spent for immediate performance enhancement and strategic intent. Organisations do not see employees spending a lifetime with their organisation. They realise that employees are money conscious and will join any organisation that gives them more salary and benefits. Organisations put a price tag on skills and competencies and give lump sum money, rather than cater to expensive benefits and perks. Individuals can spend their lump sum money the way they want to meet their specific needs. Because of better education, youth are able to hold higher responsibilities at a much younger age than their parents. Organisations realise that youth will seek quick promotions and will leave if they get these elsewhere. Organisations are all moving towards staying lean to be cost efficient as well as flexible in the market place to adapt to changes in it. We hear of massive layoffs, retrenchments, downsizing, etc. to stay trim. The employees who remain have to contribute to the bottom line. They are given enlarged and enriched jobs. It is a matter of survival for the organisation and they have to be cost efficient.

Modern Individual’s Perspective on Careers 1. Individuals realise that they are now hired for their competence and contribution to the bottom line. They spend large sums educating themselves, sometimes at foreign universities. They spend additional sums getting important certifications in specialisations. When they start working, they want a return on their investment. They will go to the organisation that pays them the best. They are willing to overlook some things that were important to yesteryear employees to get the salary cheques they find adequate. 2. Individuals realise that career span is till the age of 40 years. They realise that organisations prefer youth to bring new knowledge and skills into the organisation. After 40, individuals either re-engineer themselves into new roles or spend money in upgrading themselves to extend their career. Many will opt for entrepreneurship to provide knowledge services to organisations. 3. Individuals are driven by money to fulfil all their long-term dreams (e.g. owning a house, children’s higher education, owning a car, foreign holidays, etc.). They have to consolidate these savings and acquisitions before their career runs out by the age of 40. 4. There is no loyalty to organisations, however big their brand name may be. They are willing to join unknown companies as long as they are paid well and given larger responsibilities. Individuals realise that they are hired for their competencies and wish to cash in on them before they are perceived as obsolete. Their demand for higher salaries also factors the money they will have to spend to acquire new certifications. 5. Modern individuals are more aware of what they want to do with life. Some do not want to be subservient to a company for their money and well-being. They are willing to take risks to start their own enterprises. Cyberspace has provided them with worldwide markets and they are able to sell their services to gigantic markets.

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6. Individuals see the world as their employment market. Many opt for emigration to foreign lands while many are willing to seek expatriate jobs. Migration to the Middle East, Canada, New Zealand, and Australia are good examples. These countries have opened their doors to talent to plug severe gaps in their labour markets. Individuals want the hard currencies of the world to access better education, holidays, and better standard of living. Many convert their hard currencies to return home (especially in the east) with better wealth and an enviable lifestyles. 7. Individuals want to retire early to enjoy life doing what they value most. They want to earn quick money to be able to do exactly that. 8. Job opportunities for those individuals with the right qualifications are limitless (worldwide). They may, therefore, become arrogant and picky. They want career plans offered by organisations to tailor themselves to their demands. 9. Gen-Y (those born in the information age) is less interested in fancy titles, climbing the corporate ladder, or spending their career in one vocation. They want to explore new job avenues where they can get more challenge and work fulfilment. With better information and worldwide access, they want to explore new countries in employment or leisure. Where does career planning fit in with all these dynamic changes in thinking? Simply put, career plans in modern organisations have to give fast-track progression that meets the individual’s needs.

2. CAREER DEVELOPMENT Career Development is a systematic programme to develop the knowledge capital in the organisation so as to meet future needs of growth of the individual and the organisation. Most people associate career development with advancement in titles and positions. While this is true, it also involves growth in knowledge, skills, and competencies related to work. Career Development addresses the aspirations of both—the individual and the organisation. A career plan that mates both these aspirations is bound for success. Any career development programme has two components: (1) Career planning—which addresses the career aspirations of an individual and developing the plans to meet those needs; and (2) career management that addresses the planning, implementation, and monitoring of individual career plans, and mating them with organisational aspirations. This is illustrated in Figure 7.1. Organisational Career Development Programme

Career Planning l Occupational Choice l Career Goals l Self-development

Career Management l Recruitment and Selection l Job Allocation l Performance Appraisal l Training and Development

Mutual Benefit

FIGURE 7.1 | Career Development Programme

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Let us examine the diagram in detail: Organisational Career Development Programme is a formal planned and organised effort to achieve a balance between an individual’s career aspirations and the organisation’s aspirations as to how best to use those talents in the progress of business. It is a mechanism to create individual work satisfaction, while meeting organisational effectiveness. For example, a hotel may want a competitive advantage by introducing a new cuisine such as Mongolian food or Georgian Food. The HRD manager will then seek a chef who prepares the unique cuisine and may even go abroad in his search. Here, the role of recruitment and selection plays a part in the career management system. Once the person is on board, the organisation will ask the chef what he requires further to attain excellence and consistency. He may suggest international study tours to learn latest developments, and perhaps a course on standardising recipes and recording them. This individual aspiration is then planned and implemented because it meets the needs of both the chef and the organisation. His suggestions would be factored into his career development programme. There are times that individual aspirations cannot be fully met. As in this case, the organisation may not be able to send him on international study tours due to budget constraints. They may find an alternative by inviting experts on the cuisine to teach more cooks and impart latest developments.

Benefits of a Career Development Programme A career development programme benefits the individual and the organisation in the following ways:

Individual Benefits 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16.

Exercises greater self-determination Brings about greater self-awareness Is more proactive to gather organisational information Enhances personal growth and development Generates additional earning capacity Creates better work satisfaction Gives a direction for the future Helps in reviewing personal aspirations and adds legitimacy to goals Has more realistic goals and expectations Weaknesses are looked upon as developmental opportunities Gets a continuous feedback on performance Is more alert to the development of the organisation Personal growth is linked to organisational growth Is more responsible for his career Gets organisational investment for personal career plans Has better communication with the organisation

Organisational Benefits 1. Has a better individual-organisational fit 2. Integrates individuals more realistically with organisational plans 3. Better attraction and retention of good talent

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4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22.

Improves the quality of communication between management and employees Better image in the market as a developer to attract the best talent Integration of other HR processes Synchronicity of individual and organisational goals Develops organisational leaders as mentors and coaches Training and development programmes are more focussed Develops knowledge capital Prepares individuals for future needs Makes the performance appraisal system more productive Makes individuals accountable for their growth Sets above average performance as a precondition for career records Creates a better relationship between the superior (looked upon as a developer) and subordinate Creates the flexibility for change in business strategies Increases employee loyalty Reduces labour turnover rates Reduces absenteeism Enhances employee morale Makes individuals think more professionally Addresses the special needs of fast-track employees, women, and minorities, the disabled and mid-career employees.

Career Planning Career Planning is the process of understanding an individual’s career goals and planning how to meet them. This is a three step process: 1. Being aware of individual aspirations 2. Determining whether these aspirations can be met and are in consonance with organisational aspirations 3. Developing programmes, experiences and steps to meet those needs. Let’s see how these steps are actualised.

Individual Aspirations Individual aspirations are ascertained at the time of the hiring process. A common question asked by most recruiters is “What are your career goals in five and ten years?” This question is asked in the belief that an individual is most motivated and committed when his/her career aspirations are met. If an F&B Executive wants to be the Food and Beverage Manager in five years, it is possible. If the F&B Executive wants to be the General Manager of the hotel in five years, it may not be possible. Then, there are off-beat requests such as an F&B Manager who wants to become a Facility Planner in three years, or a Housekeeper who wishes to move into Sales and Marketing. One Purchase Manager wanted to become an outsourced supplier of hotel supplies in five years and wanted the hotel to develop him into one with the guarantee of the hotel business! Everything is possible provided it is in sync with the organisation’s plans. Aspirations can also change from the original one as the career unfolds. One hotel chain started a hotel school a few years after an HR executive joined. His original aspiration was to become the Director of Human Resources in five years. His plans went per schedule till the opening of the hotel school. The HR executive asked to be considered for the post of Principal of the

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hotel school. He felt that being a principal gave him a greater motivation in life than being a business executive. As business grows, several new opportunities arise and the career plan must be flexible to change course to facilitate new aspirations. Individuals can demand career plans from the organisation provided they fulfil certain criteria: 1. They should possess the right education, experience, and competencies to be employable. 2. They must be very clear about what they want in their career. A person who is not clear about this at the time of hiring is not desirable. 3. They should be willing to take control of their careers by investing in their skills through continuing education. They cannot afford to wait for the organisation to upgrade them. They must guard against obsolescence. 4. The new age demands mastery in subjects and skills. Once a career choice is made, the individual is required to try to attain the highest qualification and certification on the subject. This determines his/her competitive advantage over others. Organisations only want the best. For example, the ideal hospitality trainer would be one with an MBA with specialisation in Human Resources. However, if he/she has certain other achievements to show like he/she has an outstanding record of experience in human resources, he/she has a formal Hospitality Train-the-Trainer certificate, he/she has contributed articles to leading journals, he/she holds an office with the local Training Association, he/she has won national recognition and rewards for the contributions he/she made to training, etc. then he/she would appear to be the dream person for the job at hand. This is the way organisations are defining their specifications for key positions. 5. The individual shapes his/her own career. He/She want to attain career milestones very quickly. He/ She cannot afford to wait for the organisation to plan his/her careers. Careers of the 21st century are without borders, clearly opening unbelievable opportunities and placing the responsibility of career plan on the individual and not the organisation. 6. Individuals invest in building their own reputation to enhance their success and employability. The example of the hospitality trainer is a case in point. He holds an office in the local training association and contributes articles to leading journals to be known in the training fraternity. This enhances the image of the individual. 7. The individual will have skills in working in teams. He/She has good networking skills and is able to get collaboration and cooperation from others internally and externally. For example, the hospitality trainer who is able to get other trainers with special expertise to deliver talks to employees, is doing an excellent job by using his social networks. 8. An individual is required to demonstrate continuous learning to the recruiter and organisational career planner. He/She will have to show the training programmes attended; new certifications attained; and new knowledge gained from other sources, in the last 18 months. Anyone who has not done so is likely to be obsolete. New research on various subjects is emerging each year and knowledge and skills are constantly getting upgraded. 9. An individual should hunger for feedback on his or her performance. Any weakness becomes an opportunity for development and ultimate mastery. Without this attitude, an individual is creating his or her exit from the organisation. Many professionals make their own standards of performance. They are raising the bar constantly to challenge their ability and ultimate mastery. For example, a restaurant waiter may be set a target to generate X dollars in a week from the tables assigned to him. He may set his own target of X+2 dollars which keep on increasing as he attains a set level of proficiency.

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Individuals with this background and attitudes can then claim real organisational intervention in their careers. They have made themselves worthy of organisation’s attention as committed and efficient employees working towards career goals.

Career Goals Career Goals are those important career milestones in a person’s life that make significant changes in his/her life. He/She is driven by these milestones and work towards achieving them. The significant changes in career can be in the form of:

1. Money Money is a strong goal, especially when one thinks of a career change in the 40s to finance the next career. Today, youth want to make quick bucks to perhaps set-up a business by the time they are 40 years old. A banquet executive may want to set up his own events management company. Others may want to make money to finance their education in another field. An engineer may want to do his MBA to become a generalist, rather than a specialist. Most want to also secure their long-term assets like their own home or their children’s educational fund.

2. Position, Status, and Power Modern generation wants to occupy senior responsible positions at an early age. The wonderful thing is that they are capable of doing so. Someone with good higher education comes equipped with the latest know-how of doing things which their fathers took a lifetime to learn. Their learning encapsulates the learning of generations and is based on new research. The new generation is also intelligent and much more aware. Earlier, it took a person a lifetime to become a General Manager of a hotel. Today, an employee can hope to be one by the age of 30 years and be just as effective, if not more than his predecessors.

3. Mastery Mastery is a byword in this world of specialisation. Today’s practice is specialisation in a narrow field because the field itself is so large. Take for instance, the area of selection tests. People can become specialists in testing candidates who apply for jobs. There are so many tests that require knowledge of psychology along with sophisticated math. There are institutions that certify people in the use of a test. There are so many tests that one can qualify in. A person who has chosen this specialisation would go to master them all in order to give him/her employability, mastery, and uniqueness.

4. Career Change Career change is now a common goal in a borderless career life. People may join organisations that afford them that career change. A F&B executive who wishes to be a Facilities Planner is a true example of this. The organisation that will enable him to make the switch is where he will go.

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5. New Significant Knowledge and Skills As learnt earlier, continuous education is a lifelong process. Individuals list this upgradation process as a milestone in their career plan. Organisations that promise to upgrade their skills at frequent intervals will buy their loyalty.

6. Going Back to School Some employees may want to take sabbatical (study leave) to return to school to acquire new knowledge, skills, and certification. Those organisations that provide that facility can hope to secure the loyalty of the individual.

7. Self-Actualisation This means being in control of one’s environment. People want to become their own masters. Most career goals these days are heading in this direction. Many opt to become cyber entrepreneurs selling their skills and knowledge to worldwide markets. Some are satisfied to do business to niche markets. An HR Executive who started her own recruitment agency decided to provide human resources to Back Processing Offices (BPOs) only. She has enough business to sustain herself as a specialist in this field.

8. Finding the Right Occupation to Match Talents A person’s real talents may lie in an area other than that he/she has educated and developed as a specialisation. This is the case of the girl mentioned earlier who is studying computer sciences while her real talent lies in astronomy. Her qualifications will naturally lead her to a career in the computer field. Her actual talents lie in astronomy. She is bound to search for such an organisation that will offer her a computer job but will lead her to astronomy. It could be some kind of space agency.

9. Organisational, National, and International Recognition Some goals are to work towards receiving recognition in the belief that recognition will enhance image and will automatically generate a demand in the employment market for the individual. Those who opt for consultancy as their second career find it the ideal route to create a personal brand name much like Steven Covey or Tom Peters have done.

10. Multiple Skills Multiple skills are wonderful strategies by individuals to broadbase their employability. An HR Manager could also be a trainer. A restaurant hostess can also be a Guest Relations Executive. The Senior Bell Captain could also be a Concierge. Each has their own specialisation. It requires separate training and experience to reach a level of competency in both. Naturally, individuals would be exceedingly talented to be able to develop two or more specialisations.

11. Balance of Work and Home The modern employees are looking at a perfect balance between work and home. They are willing to sacrifice some advancement in their career to maintain this balance. The home circumstances become critical in an environment where both the husband and wife are earners. Sometimes, a spouse has an equally important job

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to pursue. The concept of separating their ways in pursuit of their respective careers is unthinkable. Both are required to nurture their children to adulthood. Some non-operational positions may allow for flexi-hours working from home by being connected via the web. Then, there is the aspect of education. In India, it is difficult to get admission into reputable educational institutions because of the sheer number of aspirants. Classrooms are full. Parents do not want to upset the schooling of their children and are willing to make cutbacks in their career to meet that need. Their career goals then become modest if not slow. One hotel chain had to reserve seats in good schools in locations where they had hotels. They got the seats by donating heavy education subsidies to the school to enable their executives the flexibility of movement within their geographically spread hotel chain.

12. A New Experience This is a career goal to get all-round exposure to different work environments. Some individuals opt for projects to get that new experience. A Food and Beverage Manager would like to be a member of a preopening team; a Chief Engineer would like to lead the construction and commissioning of a new hotel; or a housekeeper may want to be seconded to a hotel school to teach. Such new experiences help them develop new skills as also make them eligible for higher positions.

13. International Exposure This is a career goal to create international experience for employment abroad. Most people want to have international exposure in their résumés. Hotel chains especially have the opportunity to second their executives to international hotels within their chain to get that global identity.

14. International Employment This has become a way of life now. We know that the world is now a global village and people with the right qualifications can get international employment, if they so choose. People opt for international jobs for global identity as well as to earn foreign currency. As mentioned earlier, we know that nations like the US, Canada, Australia, and New Zealand have opened their doors for permanent residency due to shortage of skills in their local workforces. Then, there is the Middle-East which is exploding in growth but does not have native competencies to meet that. They, therefore, opt to hire expatriates to fill the vacuum of skills. Many youth chose working in foreign lands as a career option to create wealth for their second career at home.

15. Self-employment This is a very strong career goal especially as a second career option. Many workers suddenly find that they are no longer wanted in the employment market due to organisational reasons (restructuring, downsizing, mergers and acquisitions, etc.); or because of age as we have learnt that modern organisations prefer youth; or outdated skills. Many choose to become their own masters, however modest, made easy through the internet. The future of service will be provided by small individual entrepreneurs who will leverage their experiences and skills to serve niche markets.

16. Acquiring New Skills This along with the changes in technology is a good reason to prolong careers. Organisations that can commit to empowering employees with new skills have a more dedicated workforce who otherwise see their careers ending.

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Sometimes, individuals need help in determining their career goals, especially when they are newly entering the job market as also at various stages in their career. They can get this help from career planning workshops, career counsellors, information services, career resource centres, assessment centres, skills inventory tests, and career workbooks.

Organisation’s Ability Organisation’s ability is the next step in the career planning process. HRD Managers have to determine whether the organisation can meet myriad career aspirations. Organisations would have to become more proactive in career development as a competitive tool to get the best talent in the market. While hotels are creating facilities such as crèches for working mothers, in-house grocery store to enable people to work longer hours, concierge services, etc. to improve the working life of the employee, they have to facilitate career goals of the talent they hire. We must understand that there seems to be a dichotomy in the labour market. Why the fuss? On the one hand there seems to be unemployment and on the other it is difficult to get good qualified talent. We have learnt earlier that it is not the number of people available in the market that matters, but the quality of talent. Organisations can only survive with good talent to have the competitive edge. Good talents have so many employment options and will go to the highest bidder. Career planning is a strong motivator to attract good talent. The top concerns of employees today are burnout, obsolescence, lack of career growth, feeling of alienation from the firm, and a lack of trust in the future of organisations. We read of sudden acquisitions and mergers, downsizing, re-structuring, management change, etc. that create insecurity in the employees. They need a powerful force that can allay their doubts. A career development programme does just that. Here are a few things that the organisation should do: 1. While employees are responsible for their own career plans, organisations must also provide the tools and opportunities for the employees’ growth towards their career goals. By this, they not only benefit the worker, but also enhance their own knowledge capital to meet the challenges of an unpredictable market place. 2. Create an environment for continuous education through proactive policies and facilities for that. Creating a learning organisation is the way forward (see “Creating a Learning Organisation” in Chapter 10 for details). Progressive hotels provide e-learning facilities; video rooms for individuals to play skill-based video programmes; library; training programmes; study circles; invitation to experts whose fees are borne by the hotel; membership to professional associations; sabbatical; etc. 3. Provide career counsellors and career resource centres for employees to evaluate their career options. 4. Provide training and development as a way of life in the organisation. There is the orientation training for new hires, core training to enhance performance, computer training to make everyone computer literate, and development programmes for future growth. 5. Develop coaches and mentors to train employees. Organisations must make training a key result area for every manager. This ensures continuous development at the work place on a daily basis. 6. Assist in creating a balance between work with facilities like child care, vacations, etc. as mentioned earlier. 7. Develop reward and recognition schemes that support career development. The ‘Best Employee of the Month’ scheme adopted by many hotels is a wonderful example of this point.

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8. Integrate other HRD processes such as performance appraisal, succession planning, recruitment and selection, and orientation and socialisation to the career programme drive. 9. Find innovative methods of retaining good talent. For example, an organisation may help talent develop their own contract business to support the hotel if that is the direction of the individual. The horticulturist can become the outsourced contractor to landscape the gardens. The florist can become the official supplier of flowers for hotel needs. They can provide sabbatical and re-employ the employee on better terms.

Career Management Career Management is the integration of the various HRD processes aimed at building careers of employees as well as improving the knowledge capital of the organisation. It involves an ongoing process of preparing, implementing, and monitoring career plans. These career plans may be individual initiated or with organisational interventions. It starts with the hiring process. Recruiters are briefed to probe the career goals of candidates to ascertain the best fit with the organisation. Organisations realise that abetting a career aspiration of an individual is a strong buy-in of the candidate. Such aspirations must meet the overall goals and plans of the organisation. Moreover, the organisation must have the policies, budgets, opportunities, and capabilities to fulfil those career aspirations. There are other methods of ascertaining the career potential of an individual other than just asking an individual. Assessment centres, psychological tests, cognitive tests, and self-assessment tests are some of the methods used. The recruiter must then evaluate whether the job best integrates with the career aspirations of the aspirant. Sometimes, the recruiter may consider other job options within the organisation than the one he/she is being considered for, to get the best fit. Recruiters often keep résumés in the active talent bank for the right fit. Once the organisation gets the right fit between the career aspiration and the job, the performance appraisal records performance achievements potential, and career aspirations on an ongoing basis. The appraisal also records the appropriate training and development inputs required to enhance performance as also the career plan. The process is transparent and the individual knows exactly how he/she is progressing. The superior is clued in on the aspirations of the individual at the time of joining and keeps on assessing the progress of the individual along the career path. The HRD Manager reviews the recorded statements and confirms or modifies the individual career plan. The HRD manager then plans the necessary training and development programmes that include both the performance enhancing inputs for the current job and the long term inputs as per the career plan. Training and Development inputs do not necessarily mean classroom sessions only. It could also mean job rotation, job enrichment, job enlargement, cross training, field studies, delegation, and projects. It could also include providing sabbatical to go back to school, tuition refund programmes, sponsorship to external training programmes, and formal mentoring programmes.

Procedure for a Career Development Programme The HRD department drives a career development programme. It is the HRD Manager who integrates the various HR processes to the career development programme. The HRD manager may co-opt an external Career Consultant(s) to make the system more professional and reliable.

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Here are the steps in a career development programme:

Step 1 The HRD manager recommends Career Development policies to the top management for adoption. These policies become the legitimate guidelines for future career development activity.

Step 2 Develop the career development tools (explained later in detail) for the programme. These tools may be inhouse or outsourced. The common tools in a career development system are assessment tests to ascertain capabilities and competencies of individuals; career guidance tools; training and development programmes (including e-learning); libraries; videos and CDs; self-learning materials; performance appraisal system; development programmes.

Step 3 Communicate the programme and facilities to the employees and management. The marketing may like to promote this as a competitive advantage to get better talent as also more business.

Step 4 Study the business plans and strategies; plans for new products and services; and Chairman’s speeches and news announcements of the organisation’s long term goals to determine the needs of human capability.

Step 5 Ascertain the career goals of all existing employees, using the assessment tests and career guidance tools, wherever required.

Step 6 Make a skill inventory and match it with the organisational needs. Establish gaps in skills not available within the organisation.

Step 7 Ensure that the existing performance system has an assessment of career potential.

Step 8 Create individual career plans setting the career path in terms of their aspirations. Career planning software is now available. Establish the milestones for development and the time frames by when they should be reached. Study past performance appraisals to see whether performance warrants inputs to enhance current performance and for future development.

Step 9 Conduct the following training in preparation of the system launch: l l

Managers in the art of mentoring Managers/Supervisors in coaching skills

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Managers/Supervisors in appraisal interview skills Recruiters to conduct executive assessment tests Trainers in new areas of development Career Planning Workshops Career counsellors to hone their counselling skills.

Step 10 Launch the career development system

Career Development Tools There are career development tools of two types: (1) for career planning in order to ascertain individual aspirations; and (2) those that are necessary to realise the career management system.

Tools for Individual Goal Setting Self Assessment Tool This is a reliable first information questionnaire. It makes individuals think about their career aspirations and pen them down. They then take ownership of their aspirations. This may be administered at the time of interview; at the time of joining the organisation; or when the career development programme is launched in the organisation. Typically, the self assessment exercises are meant for individuals to evaluate their life, interests, skills, competencies, attitudes, and preferences. The tool facilitates individuals in setting short and long term goals and deciding what they need to do to accomplish them. They make action plans and identify the impediments that come in the way of actualising them. They list the assistance they require from external sources including the organisation. Career Planning Workshops These are conducted at high school and university level in the first instance. These workshops help the students to select their high school subjects to fulfil their career goals. Career Workshops are also conducted by external private agencies to guide individuals on the threshold of careers. They may help individuals determine the higher education courses or skill certifications they require. Many organisations hold these workshops at universities and schools to help determine career options within the organisation. Hotels hold presentations and answer questions about careers in their property when they visit hotel schools before the students graduate or at the time of campus recruitment. Organisations hold career planning workshops when they launch a career development programme within their organisation or as a continuous process to help individuals review their personal career stances. Career Counselling This is a potent method to help individuals plan their careers on a one-to-one basis. Career counsellors are specialised in that field with a wide knowledge of psychology, sociology, and work environments. They may even conduct cognitive and psychological tests to determine individual abilities and potential. A typical career counselling session will first explore an individual’s past, interests that developed over the years and those sustained over time, special talents and competencies, personal achievements, and personal life aspirations. They confirm these by tests. It is only then that they are able to present various career options that match the personality and capabilities to the career.

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Career counselling is not prescriptive but exploratory. The individual is the one who decides the career path he/she wishes. Career counsellors use the same approach for practicing employees who are seeking a career review. The career counsellor provides the new developments and options in the job market. They also guide candidates on the courses and programmes available to meet the new career goals. Within the organisation, the HRD professionals take on the role of career counsellors. They need to be trained for these roles and be constant career coaches during the career life of the individual within the organisation. The coaches must learn how to listen, know how to ask the right exploratory questions, know thoroughly the career options within the organisation, help to frame realistic career goals, and recommend appropriate career actions.

Career Workbooks These consist of appropriate questions and exercises to help individuals explore their career options. They help individuals identify their strengths and weaknesses, develop skills inventories, and give options on career choices. The workbooks also give possible career paths and are guide on how to choose courses. Career Resource Centres These are the least expensive method of getting information on careers. They are usually found in university campuses, city town halls, and employment bureaus. They have a library of reference books, videos, brochures, career development materials, self-study tapes, and CDs. Many also offer free information material. They keep profiles and brochures of various companies explaining careers in them. They also have free internet service to help employees browse through various career options. The HRD Departments in organisations offer career services with newsletters, brochures, company literature, and manuals. Hotels who want to get the best talent may offer this service as an image building tool in the job market.

Career Tools Used by Organisations Assessment Centres These are an increasingly popular method to evaluate individuals. Surveys find that 43 per cent of the organisations in the US use assessment centres. These centres have professional psychologists who administer a battery of tests, exercises, games, and role plays to determine human capability and potential. They give measured feedback on an individual’s strengths and weaknesses. Assessment centres are good at predicting career options, potentials, and fields of success (see “Assessment Centres” in Chapter 10 for details).

Psychological Tests These are powerful forecasters of capabilities and potential. These are scientific diagnostic tests with a high level of predictability. These tests are supported by career counselling. These are basically paper-and pencil tests and questionnaires that help in determining an individual’s vocational interest, personality profile, work attitudes, career needs, and preferences. Some notable tests are the Myers-Briggs Type Indicator, Strong Vocational Interest Inventory, PI 5, Big Five Personality Factor, Kuder Preference Schedule (which assess preferences for certain jobs and job characteristics).

Career Paths (or Career Ladders) These are maps which specify the steps (job positions) required by an employee over time. Some paths are standardised while others are fast-track development. The career path will also specify the courses and experiences required to attain each step. The following (Figure 7.2) is an example of a standard career path of a receptionist (which is indicative only and may be modified by each hotel).

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Step/Time Frame

Job Position

Entry Point

Receptionist

Knowledge l l l

Reservation Procedure Registration Procedure Information Procedure

Skills l l l l l

Supervisory

Shift Supervisor

l l

Std. Time: 3 year Fast-track: 1 year

Front-Office Procedures Shift Taking-over Procedure

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Junior Management

Front Office Assistant Manager

Std. Time: 5 years Fast-track: 2years

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Inter-departmental Understanding Management Principles Hotel Management Front Office Procedural Knowledge

l l l

l

l l l l l l l l

Middle Management

Front Office Manager

l

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Std. time: 3 years Fast-track: 2 years

l l l l

l l l l

Resource Assessment and Procurement Career Planning Group Dynamics Hotel Marketing Yield Management Performance Management Policy Making Career Management Revenue Management Accounting Knowledge

l l l l l l l l

l l l l

Tallying Room Rack Fidelio Computer Skills One Foreign Language Communication Skills Customer Service Skills Work Allocation Attendance Briefing Supervisory Skills Problem Solving Skills Team Building Motivation Coaching Skills Customer Handling Skills Upselling Skills Leadership Motivational Skills Business Communication Skills Problem-solving and Decision-making Skills How to take Briefing Disciplinary Skills Staff Scheduling Skills Coaching Skills Team Building Mentoring Career Counselling Coordination Skills Business Communication Resource Allocation Budgeting Skills Conducting Meetings Counselling Skills Interview Skills Orientation Skills Developing Job Descriptions Appraisal Interview Skills Setting Standards Public Relations Skills Interpretation of Reports

Competencies l l

l l l

l

l l

l

l

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Well groomed Etiquettes and manners Teamwork Punctuality Setting an Example

Leading by Example Self-discipline Benevolent Dictator

Representing Management in Public Forums Crisis Management Self-discipline

FIGURE 7.2 | Standard Career Path of a Receptionist We will notice in the career path above that the standard time taken to reach a Front Office Manager’s position is 11 years. The time taken in a Fast-track is 5 years. There are several assumptions here when considering the time frame of development: 1. The individual has shown potential for management positions at the time of hiring. This has been confirmed by tests.

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2. The individual hired displays management qualities and is the best. Students of hotel management are the best at entry level because they are already groomed for management positions. 3. The individuals show exceptional performance in their annual assessments. The above average performers go through the standard time while the outstanding are put on fast-track. 4. That the organisation believes in development from within and gives the first choice to their employees. 5. That the concerned position vacancy arises at the time when people are ready. In today’s world of career mobility this is quite a concern. Sometimes, organisations individuals develop individual well in preparation for a hopeful vacancy, only to find the individual decamp to another organisation in pursuit of a ready position. 6. The organisation is willing to take the risk of development, only to lose their resources to competition. Sometimes, attrition is good. It is a filter to identify the die-hard company loyalists who deserve further advancement. 7. The concerned knowledge, skills, and competencies are developed on time. Sometimes, financial resource constraints may stymie the best laid career plans. 8. The entire management is in sync with the career development programme. 9. The immediate supervisors are aware of the career aspirations of their subordinates and are willing to release them when their time for advancement comes. Immediate supervisors in the hospitality industry are comfortable with a developed team. They loathe releasing them when their department is performing well. 10. Fast-track employees create jealousy among colleagues who may ‘switch off’ when they are advanced ahead of them. This is particularly true when junior employees supersede senior employees in the fast-track programme. Many employees resign in frustration. Fast-track employees face great resistance and find it difficult to get cooperation. The management should be able to manage the disappointments of others. 11. Department heads are willing to release the fast-track employees for training and development programmes which are intense and take them away from the workplace periodically. The department has to perform with one less excellent ‘warm body.’ 12. Manager’s give continuous feedback to the HRD department on the progress or deficiencies of individuals. HRD cannot wait for the annual appraisal only. They need constant feedback to rectify or enhance progress. 13. Managers take coaching, mentoring, and counselling seriously. In the hospitality business, the pressure of providing service is so intense that such managerial responsibilities are overlooked or postponed. 14. That the operational managers are in sync with the intentions and urgency of the HR department in career plans.

Fast Track Fast-track needs an explanation. Fast-track is a career progression that proceeds faster than standard time. Fast-track employees go through an accelerated progression with intense inputs. The organisation often identifies star performers who cannot be retained unless provided with fast growth. The HRD department gives closer counselling, requires more frequent feedback, creates out of the way development programmes and monitors progress closely. They need the close cooperation of the immediate supervisor and the department.

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Both also have to manage the discomfort of the other employees. Here are some ways to deal with non-star performers:

Exit Programmes A Career Development programme not only works towards retaining good performers but also has to identify and manage those employees who are no longer useful to the organisation in the present job. Such employees are usually older employees who have outlived their utility and are unable to move with the current trends. They command high salaries because of the years put in by them. They are entrenched in the organisation and hold on to their jobs because they cannot get employment elsewhere. The only thing in their favour is that they have shown their loyalty and have contributed with their skills when it was in vogue. Such people sometimes become dysfunctional and do not let the younger generation into their “territory.” The HRD manager has to identify such people and think of strategies to deal with them. The strategies are: 1. Retrain them into new skills. They may take time to attain a level of proficiency in a new skill. But some are unable to learn new skills and are candidates for exit. 2. Offer generous severance pay packages to enable them to start another career. 3. Offer career counselling and advise them the courses they need to attend to re-engineer themselves. 4. Provide sabbatical when they are in service to gain new competencies. 5. Reimburse their tuition fees. 6. Rotate them in other positions to discover where they can be useful. 7. Provide them a phased retirement plan. 8. Give them loans against their pension funds to set up their business. 9. Retire them but keep their benefits (medical, insurance, leave travel, company housing, etc.) for another year. 10. Give them frank feedback of their depleting career with the organisation, but let them go with dignity. Have a farewell ceremony and give them a token of appreciation of their services. 11. Use organisational networks to get the employee another suitable job employment. 12. Retire them and rehire them on retainership at a much lesser cost as also avoiding the contribution to long term funds. Organisations do this to retain their guest contacts and goodwill.

Mentoring This has become a popular and powerful tool nowadays. (see “Mentoring” in Chapter 10 for details). A mentor is a senior person in the organisation who becomes an internal guide to an employee (especially a new hire). The mentor is not the direct supervisor and has no influence in the rewards and recognition systems influencing the employee. The mentor, to put it in common words, is a ‘friend, philosopher, and guide.’ The objective of the mentor-employee relationship is to enhance job performance and integration with the organisation.

3. SUCCESSION PLANNING Succession Planning is a formal process driven by the HRD Manager to identify excellent performers in the organisation and develop them to hold higher key positions immediately (drop dead successor) or in the future (long term successor). It looks at immediate subordinate levels to key positions of leadership by identifying and developing those who have the potential to fill the vacancy at the higher level on an immediate or long term basis. Through this process, organisations create pools of candidates for leadership positions.

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This process is necessary as it takes time to develop good leadership. It works on the belief that the best form of growth comes from within the organisation. Internal candidates can fill important positions with least disruption to operations. Leadership is a critical issue to the organisation. It is the leader who brings continuity, progress, and survival in a turbulent market place. Succession Planning is a powerful tool to ensure minimum brain drain of knowledge capital. While it is a part of the career development programme, it specifically addresses leadership issues at middle and top management. Succession planning relies on certain assumptions: 1. The organisation is growing, giving upward opportunities and mobility to its leadership. A succession plan is fraught with danger when the organisation is stagnant and leaders have no growth opportunities. 2. The leadership is actively involved in the development of successors. 3. The pool of potential candidates is of a high calibre. 4. The succession plan is kept confidential and is known only to a few as the ripple effect on those not on the plan brings de-motivation. 5. The organisation has a strong training and development set-up to give quality inputs to potential leaders. 6. The organisation has set aside a budget for this particular training and development effort. 7. The organisation has a strong and transparent performance appraisal programme that throws up star performers. Selections must be made on hard facts, not impressions. 8. The selection is made on merit and not on politics and favouritism. 9. There is a contingency plan for those not selected, once promotions are announced.

Steps in Preparing a Succession Plan Step 1 Study the short and long-term growth plans of the organisation.

Step 2 Identify the key leadership positions. A key position is one that is not easily replaceable and one which must have continuity for the function to survive.

Step 3 Conduct a human audit of possible candidates. The study will examine the last five-year performance records, achievements, innovations, personality traits, integration with the organisation’s ethos, leadership qualities, etc. Such criteria may be supported by psychological tests. The audit will throw up areas of development.

Step 4 Map out the positions and persons as shown below. The example (Figure 7.3) is of a hotel which is part of a growing chain. Senior managers may be ready for General Manager positions of new hotels elsewhere in the chain. Stand-alone hotels should not have a succession plan.

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General Manager

Director Accommodations

Director Food and Beverage

Financial Controller

Chief Engineer

F.O. Manager

Executive Chef

Income Accountant

Assistant Chief Engineer

Executive Housekeeper

Assistant F&B Manager

Financial Analyst

Critical Positions

In this case three positions have been found to be critical. The Chief Engineer has a ready successor, therefore, it is not listed as critical.

Drop Dead Successor

The drop dead successor is one who fills in a sudden vacancy. He/She holds the position till the long-term successor is ready (less than a year).

Long-term Successor

The long-term successor is the final occupant of the position.

FIGURE 7.3 | Key Leadership Positions

Step 5 Organise the development programmes within time frames of development. A long-term successor must not take more than three years to be ready.

Developmental Programmes Developmental programmes are those inputs that prepare human resources for the future. They are the bedrock for the Career Management Programme and the Succession Plans. Developmental programmes are run by the human resources department who may have in-house trainers or outsourced experts to conduct them. The developmental programmes range from 3 days to 15 days. The formal management training programmes and Supervisory Training programmes may even last for upto two years where participants are full-time trainees on a stipend. These programmes provide the main source of supervisory and management supply to the organisation. The students will be typically from hotel schools. Some organisations even provide sabbaticals to deserving candidates to improve on their knowledge and skills. Hotel and restaurant chain operations have their experts who conduct developmental programmes for the needs of employees. They are able to source and finance such experts from around the world. The developmental programme selection and course content is based on the specific needs of the employees thrown up

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by the performance management programme, career development programme, and the succession plans. Further, needs are identified by assessment centres.

Executive Coaching Executive coaching is a focussed one-to-one personal learning for executives. It works well in a succession planning system. The coach is an internal counsellor or an external expert. The coach evaluates the past performance appraisals (preferably a 360 degrees assessment) to give the executive a feedback of seniors, peers, and subordinates. The strengths and weaknesses are identified. The strengths are further tuned while weaknesses are areas of development and counselling. The basic purpose of an executive coaching scene is to work closely with an executive to improve his performance and effectiveness as a leader. The coach attempts to modify behaviours to get better results. The coach may recommend external programmes such as sensitivity training or leadership seminars for personality and leadership effectiveness. The benefit of executive coaching is that it does not disrupt the executive’s daily schedule, but can fit easily into it. It is also confidential and the executive can set aside his/her public image and ego and be truly in a humble learning mode. It is individualised, targeted, and flexible, responding to the immediate improvements required. It is especially valuable in the modern global workplace when executives have to lead multi-cultural workforces. The coach is able to train the executives to the nuances of various work values of different cultures. Executive coaching is also valuable to women leaders and those from minority groups.

Mentoring It is discussed above. (see “Mentoring” in Chapter 10 for exact details).

Mid-Career Counselling Mid-Career counselling is a new method employed to help older employees or retirees to re-engineer themselves and cope with the circumstances. We have learnt that the modern workplace wants youth in their workforce. This is especially true in the hospitality industry that needs high energy and active enthusiasm to give quality service. Those who do not fill the profile need help to re-establish themselves. There are many older employees who are not selected in the succession programme and their disappointment has to be managed. New directions have to be evolved outside the organisation. With restructuring and layoffs the need for such counselling becomes more valid.

Benefits of Succession Plans 1. 2. 3. 4. 5. 6. 7. 8. 9.

Respond to short and long term business strategies. Succession is planned taking personality and capability into consideration. Able to retain star performers. Avoid risks caused by random or politically induced selection. Maintain continuity of functions. Prevent shocks to the organisation with sudden vacancies. Increase the pool of leaders in the organisation. Move specialists into generalists with wider people orientation. Create leaders.

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10. 11. 12. 13. 14. 15.

Integrate the various HRD processes Identify star performers. Broaden the use of cross functional development Improve internal promotion opportunities. Get management to think seriously of protecting their leadership capability Are a strong motivator for those on the programme. Others will hopefully work hard to be on the programme. 16. Enrol the leadership in the developmental process. 17. Increase the knowledge capital of the organisation.

Summary The attitudes towards careers have changed dramatically for both the employee and the organisation. Today individuals have seamless career opportunities globally to seriously think of long-term careers with a particular organisation. Their loyalty lies with their profession. Organisations reconfigure themselves to meet the fast changing market scenarios with the result that they create unstable careers within the organisation. Organisations prefer a youthful workforce as they come with latest knowledge along with exuberance and energy. Youth are also very adaptable to changing environments. Individuals pick careers of their choice matching their interests with their talents and strive to master their specialisation at their own cost. Organisations, therefore, opt for fast career tracks to meet the individual and organisational aspirations. The development of potential is done through career plans and succession plans. Not only do these processes attract the best talent, but also help in retaining talent once they are on board.

Key Terms Downsizing Delayering Decentralising Acquisition Merger Mentoring Re-organisation Career Development

Reducing the number of jobs Reducing the number of levels in an organisational hierarchy Reducing central control A company buying the control of another organisation When two companies become one A formal relationship between a senior manager who is not the immediate superior to help the growth of a subordinate Change in business focus A systematic programme of individual and organisational growth (Contd.)

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Key Terms (Contd.)

Career Planning Career Management

Developing individual potential in keeping with his aspirations Planning, implementing, and monitoring career plans to meet organisational goals

Review Quiz Short Notes 1. 2. 3. 4.

What are the organisations’ and individuals’ perspectives towards careers in modern times? Why are organisational careers unreliable and short? What are the benefits of a career development programme? Write short notes on: (a) Mentoring (b) Career Counselling (c) Career Resource Centres (d) Executive Coaching (e) Benefits of a Succession Plan 5. What are the steps in preparing a succession plan?

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8 Compensation and Benefits 1. OVERVIEW The term compensation refers to all forms of financial payments and tangible benefits received by employees in exchange for their services with the organisation. It constitutes a major part of the employment contract (appointment letter) which seals the relationship between the organisation and the employee. As business environments gets more complex, the challenge of compensation increases, requiring innovation, professional expertise and vision, at the same time managing the costs of such programmes. The traditional compensation elements comprise a basic salary which is the root worth of a job. The basic salary moves along a salary grade that is fixed for various job positions. Many traditional organisations (especially in the public sector) still give employees salary grades.

Salary Grade A salary grade is the minimum and maximum value of a job along a monetary scale. The scale pre-determines increment values to compensate for the increase in standard of living and acceptable performance. When the job position changes, so does the grade. Let us take the scales below as an example: Superior position Subordinate position

6500 – 500 – 9000 – EB – 650 –12250 – EB – 800 – 16250 3000 – 250 – 4250 – EB – 350 – 6000 – EB – 500 – 7500

We notice that the lower grade scale starts at a minimum of 3000 and a maximum of 7500. A new job entrant will start at the beginning of the scale. The scale has a span of 15 years from the minimum to the maximum, on the assumption that a job holder gets one increment each year. Between two larger values we see a smaller figure which is the increment. The increments in this case are 250, 350, and 500. Each increment value has a span of five years. This means that the employee will continue to get an increment value each year for five years till he/she reaches the efficiency bar on the scale. Within the grade are efficiency bars (EB) which are points in the scale where the value of the increment increases. Crossing an efficiency bar means that the person has earned a higher value of increments based on his/her efficient performance which is tantamount to at least an average performance. In this way, a person

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can get a reasonable enhancement in salary in recognition of the years of service put in with the organisation. It is recognition for loyalty. People move along the scale based on performance. An average performance is one where all standards are met as per the objectives of the job and the employee gets one increment. An above average performance means that some standards are exceeded while most have been met. In this case, the employee gets one and a half increments; while excellent performance is when an employee exceeds all the standards set and therefore, gets two increments. Those giving below average performance may not get an increment or cross the efficiency bar. The grades are well-stretched to give an employee ample scope for salary advancement. The moment a person reaches the maximum of the scale, he/she should ideally be promoted into a higher grade which adopts all the principles as discussed above. The minimum point of the higher grade may perhaps start at a figure in the third section of the previous grade. This is done to ensure that the costs to the company do not gallop unreasonably. The real challenge comes when a person in the subordinate grade reaches the maximum of the scale but is not fit for a promotion. There are several stances that a hotel may take in such a case: l l

l

Get rid of the person because he/she has not shown potential for higher positions. Freeze increments in ensuing years. Older employees may not mind this if they have no more career time left for a career change. Extend the grade at the last increment value for another five years provided the employee has proven to be an asset at that position, but is not suitable for the next.

Basic Salary The basic salary is an important component of a pay package. It influences other compensation elements like long-term benefits (provident fund, gratuity, pension, etc.); leave entitlements; housing limits, etc. For example, a leave salary is one month’s basic salary, while the house rent allowance is a percentage of basic salary. This enables the organisation to budget and control wage expenses within reasonable costs. Funds for long-term benefits are mandatory as per the law. A company has to contribute a percentage of the basic salary to the various long-term funds. The basic salary is benchmarked with the competition to be on level fields to attract and retain good talent. The basic salary is the nodal point of discussion in union-management negotiations. The union always fights for increases in basic salaries as it impacts other benefits automatically.

Benefits Benefits are those compensation elements that improve the quality of life of the employees by providing them and their families with a level of financial protection. The objective of benefits is to attract and retain qualified and competent employees. It works on the premise that people will give their best productivity if their personal non-work needs are taken care of. Women and single mothers are particularly attracted to company benefits. The importance of benefits increases when there is a shortage of qualified and competent people in the labour market. It becomes critical when other organisations compete for the same pool of talent. Benefits constitute one and a half times the direct pay package. While some benefits have to be provided by law, others are discretionary, i.e. based on the organisation’s financial ability to provide them. Traditional organisations that believed in the ‘cradle to grave’ policy took

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control of the employee’s total well being, which included his/her work and family life. They felt responsible to look after the complete needs of the individual as a measure of securing their lifelong career and loyalty with the organisation. Modern organisations do the same, but prefer to give lump sum money to the employee to decide where he/ she chooses to spend it in his/her list of personal needs. This flexible (or cafeteria) style also saves the organisation from the complexities of administering the different benefits. At one time, benefits were quite uniform, but in the cafeteria style, two employees doing a similar job may have separate benefits suiting their specific needs. Benefits also attract personal income tax and employees distribute their lump sum taking the full advantage of tax exemptions. Benefits like health programmes and free duty meals are tax free, while pension plans are tax-deferred to the time when they are actually paid. Individual and company contribution to long-term plans are not taxable. The discretionary benefits vary based on the size of the organisation, the industry it belongs to, the human resource philosophy of the organisation, and the job position the employee holds. The hospitality industry may provide free duty meals, while the automobile industry may provide a company maintained car as a benefit. Benefits are, therefore, divided into two categories: (i) statutory and (ii) discretionary.

Statutory Benefits These are covered under the provisions of law. These benefits are: l l l

Provident Fund or Pension Funds Medical Leave Annual Leave

l l l

Gratuity Minimum Wages Maternity Leave

Discretionary Benefits These are those that are given on the basis of the organisation’s policies and capacity to support such schemes. These are:

Company Housing or House Rent Allowance The organisation feels obliged to help an individual meet one of the basic needs—a roof over one’s head. Senior employees are provided with accommodation— some with furnished accomodations and others with accomodations which are not furnished. Accommodation may be owned by the organisation, however, some organisations reimburse rent payments. In the middle-east, hotels provide accommodation to all their expatriate staff. They have self-contained staff compounds with a grocery store, cooking facilities, club-house, sports facilities, etc. Company Transport or Transport/Petrol Allowance Senior executives are provided with company maintained cars. The company may have their own cars which they allot to individuals or purchase new ones to meet the special choice of the executive. The company may pay the EMI (Equal Monthly Installments) or include it in the lump sum payment made to the individual. Typically, the organisation will have a budget limit for a car. Alternatively, executives may possess their own car and are given a transport allowance for petrol and maintenance. The belief in providing this benefit is to provide the executive the means to reach office from home and return, as also to meet their outdoor business commitments. Companies also provide re-imbursement of fare for local business travel. They may specify the mode of transportation.

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Benefits also include: l l l l l l l l

l l l l l l l l l l l l l l l l l

Health Care or Health insurance Life Insurance Education Schemes or Fees Re-imbursement Company loans (interest free or interest below the market rates) Domestic help salary re-imbursement Annual Leave ranging from 21 days to a month Leave pay (amounting to one month basic salary) to have money when on holiday Leave travel for self and family; (the class of travel is based on job position) or limited to one month basic salary Maternity leave for women employees with full pay Casual Leave with pay to attend to domestic exigencies Emergency leave with pay Medical Leave with pay Medical insurance or reimbursement Education reimbursement for children Sabbatical leave Reimbursement of tuition fees when on sabbatical Training and Development costs Domestic help reimbursements (for gardener, cook, driver, security guard) Long-term benefits (pension, provident fund, gratuity) Life Insurance Entertainment allowance Job insurance (for jobs with risk like the cashiers) Cooperative Store for daily groceries Transport services to pick and drop employees from home Free accommodation in some locations

The hospitality industry provides the following benefits in addition: l l l l l l l

Free duty meals Company maintained uniforms Transportation for pick-up and drop from residence Hotel medical clinic Free counselling service Co-operative grocery store Crèche for working mothers

North America has also the following benefits for those on foreign assignments: l l l l l l

Social Security Unemployment Insurance Health Insurance Workers Compensation Insurance Work Visas Paternity leave for husband when wife is on maternity leave

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Modern Views about Benefits Traditional organisations take care of practically all aspects that govern a person’s work and domestic life as mentioned above. They do this because of the ‘cradle to grave’ policy. This also has changed dramatically in the information age. Organisations now recognise that the employee has changed and no longer looks at lifelong employment. Employees now have borderless employment opportunities to achieve personal satisfaction and independence as their life infolds. The ambitious young also work with an organisation for shorter spans and go to organisations that give them better compensation. They are no longer awed with big brand names. Their competency is currency that goes to the highest bidder. In order to survive in a fierce global competitive environment, modern organisations are forced to look at employee competency rather than loyalty. Organisations have to reorganise their businesses frequently to compete. They are forced to use strategies as restructuring, downsizing, de-layering, etc., that make their workforces leaner and meaner. They can no longer afford to carry mediocre performers and have to painfully release them in favour of those who have the latest skills and competencies. They need performers who will add to the bottom line. We also learn that organisations are looking at a young workforce to bring energy, enthusiasm, commitment, and burning ambition to succeed and excel. Older workforces have to keep up or exit to accommodate the young. Older employees have to re-engineer themselves into new roles not necessarily working for an organisation. They may start-up on their own.

New Compensation Strategies These changes have a stunning impact on compensation. Such new changes are: 1. Compensation becomes person specific. This means that compensation is no longer confined within grade structures. If grade structures exist, they will be loose giving wide berth to position talent. Organisations pay the individual what he/she wants to attract and secure him/her in the organisation. This strategy brings diverse compensation packages within job positions bringing inequity. 2. New specialist skills have no comparisons in the market. The specialist can demand salaries in terms of what he/she thinks he/she is worth. For example, a specialist chef, in say Georgian cooking, cannot be compared to a common chef. A telecom expert who brings new dimensions to communication cannot be compared to an ordinary telephone engineer. 3. Organisations are forced to downsize to keep their workforces lean, to contain spiralling wage costs. They use innovative means such as multi-skilling, longer working hours, and enlarged and enriched jobs. They are thus able to pay the fewer people in the organisation better. 4. Organisations have adopted a ‘Cost to Company’ (CTC) approach where a sum of money is paid to the employee leaving him or her to spend it in any manner to meet their needs. This ‘cafeteria’ approach has become more popular in today’s compensation strategies. The individual will distribute components of the lump sum to take full advantage of tax planning. 5. Organisations have stopped taking the load of employee benefits except those of a legal nature. Instead, they secure employee loyalty with career development programmes and fast-track advancements in their career. 6. Other innovations in compensation are the performance bonuses, merit increases, stock options, commissions, and share in profits. These methods give disproportional funds to employees based on their excellent performance.

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The composition of the workforce influences compensation strategies and practices that in turn influence performance and effectiveness. They have important implications for business and their ability to create and sustain competitive advantage.

2. DOES MONEY MOTIVATE? Research shows that money matters tremendously to the Gen-Y. The new and future employees see salary in the following manner: 1. The cost of living has increased tremendously. They have to be able to maintain a reasonable lifestyle. 2. The employee has spent a lot of money in higher education. Many have sought admission to foreign universities at great cost to stay competitive. They have to get the return on investment. In India, private institutions charge capitation fee under several names such as building fund, student welfare fund, etc. These additional fees, over and above the tuition fees, are prohibitive. Most of them have either taken lifelong loans or have borrowed from family. These have to be repaid. 3. Most realise that their direct working career is short. They have to earn enough during their short career to secure their life assets and pay for their future plans. Many want to buy their home now as real estate prices surge each year. Some may invest in the suburbs of cities and major townships where real estate costs are lower, increasing local travel costs for work or pleasure. 4. Lifestyles have changed. Youth today believe in branded products and services. A pair of Levi jeans will cost thrice the amount over a local one. Peer societal pressures prohibit them seeking unbranded products. Using branded products give them a status. The same goes for vacations. With travel made easy and the breaking down of state boundaries, foreign vacations are a must each year. The modern youth work hard and enjoy hard. They do not think less than eating at branded restaurants or possessing a Japanese car. They need money to live that lifestyle. 5. They prefer performance linked-compensation. The rewards for good performance must be substantial to make a difference to their living. They are willing to work long hours under pressure as long as they get financial rewards. Their financial rewards will be proportionate to their inputs and results. They want financial rewards that will secure their future. 6. Employees today know that the onus to keep upgraded on new developments in their profession lies with them. They want to be able to afford the cost of new or higher certification to be of value to the organisation. The cost of not staying with the times can result in a loss of employment. 7. Some customer oriented jobs of the service industry require personal maintenance to be competitive. A Guest Relations Executive once asked for a very high pay. She said that to stay glamourous and fit for the job she has to go regularly to the gym, beauty parlour, buy new dresses, have her hair coiffed every day, go to a diet clinic, and buy expensive cosmetics. She said that the high salary was necessary to maintain herself to be the right person for the job. She was right. She got the job and the salary. 8. Money is a status symbol in society. Good money reflects an image of being rich, successful, intelligent, and motivated. A well-paid employee commands respect and position among his/her peers, family, and society.

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9. As people get older, the benefits of a compensation package assume importance. It is the time when employees establish a family. Those benefits that will serve the family are valued, like maternity benefits, children’s education, annual vacation pay, etc. So, we learn that money does matter. However, as we shall see in the section, “Individual Motivation” in Chapter 12, money only serves to meet lower order needs such as survival, security, and social needs. Higher order needs such as self-esteem and self-actualisation are attained through factors other than money. These factors include achievement, personal growth, and the power to influence the environment. Organisations have to plan their strategies creatively so as to marry individual motivations at various stages of their career to organisational effectiveness.

3. DEVELOPING A COMPENSATION PACKAGE Compensation is divided into two components: 1. Cash compensation

2. Benefits

that is the basic salary, overtime, hourly wage, allowances; and pay that is contingent on performance such as bonus, merit incentives, commissions and stock options. that are legally guaranteed such as superannuation funds, compensation funds, etc. and those that are discretionary benefits such as housing, car, insurance, etc.

Cash Compensation A crucial element in this category is the basic salary. The basic salary maintains equity in the organisation, both in the traditional and new system of compensation. The basic salary influences the long-term benefits as we have already learnt because they are calculated as a percentage of basic salary. The following model (Figure 8.1) gives the steps in determining a basic salary or base pay: Job Analysis

Job Descriptions

Job Specification

Job Evaluation

Compensation Policy

Reconciliation with External and Internal Considerations

Job Worth Hierarchy

Pay Structure

FIGURE 8.1 | Steps to Develop Base Pay

Competition

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Let us understand this model:

Job Analysis and Job Description The Job Analysis (or Work Analysis) has been explained in detail in Chapter 3, “Hospitality Human Resources Planning”. We have learnt that it breaks down the broad components of the job. It lists ‘What’ has to be done in the job. During the job analysis, we also define the internal and external people that the job holder coordinates with, the authority that the job holds, the equipment that the job position handles, and the type of knowledge, skills and competencies required to perform the job. The Job Analysis gives the base matter that is translated into a job description which is a formal document that specifies the profile of the job. The job description further helps in determining the job specification which outlines the knowledge, skills, and attitudes required of the person who does the job.

Job Evaluation The next step that is job evaluation is a crucial one in developing a compensation structure (see “Job Evaluation” in Chapter 10 for details). Job evaluation is the process of evaluating the value of each job in relation to others. It is a method of creating internal cohesion and equity of salaries. Through this, employees have the confidence of receiving a fair wage comparable with others. Job evaluation is an objective procedure that evaluates the content of the job, its complexities, amount of responsibility, risks, and the level of effort required in the job in relation to other jobs. It does not evaluate the traits of the person occupying the job or the quality or the performance of the job occupant. However, it takes into consideration the qualifications, skills, and experience required to do the job. Such comparisons of jobs bring about a hierarchy of job worth, based on points, against which pay structures can be created. This is a highly specialised science and done by qualified and certified people. To bring in better objectivity, it is recommended that job evaluation is done by an external consultant who will counter any biases lying within the organisation. There are three steps in the job evaluation process: 1. Job Analysis, Job Descriptions, and Job Specifications that clearly profile the job and the person required (in terms of knowledge, skills, competencies, and experience). This has already been discussed in detail in “Job Descriptions and Job Specifications” in Chapter 3. 2. Job evaluation by rating the job. 3. Comparing the results with other jobs. The sub-values are totalled to give a grand total and average that can be compared to other jobs. The important thing is review and rationalisation. The jobs are then placed in a hierarchy which becomes the format for grade and salary structures.

Job Evaluation Methods There are basically three evaluation methods: Job Ranking, Job Classification, and Point-factor Method.

Job Ranking involves placing jobs in order of the most important (or most difficult) to the least important (or least difficult). The importance is determined by the impact it has on the business to give it a competitive advantage. The method looks at each job as a whole and not the components that make up the job. The diagram (Figure 8.2) below gives an idea:

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Revenue Generators

Reservationists Receptionists F&B Captains Floor Supervisors Chef-de-Parties Beautician Health Club Bartender

Direct Service Providers

Room Attendants Waiters Cooks Bell-Boys Masseurs Telephonist

Indirect-service Providers

Gardeners Accountants Security Technicians

FIGURE 8.2 | Job Ranking It is the simplest method but most difficult to explain to employees. The main problem with this system is that there is no value given for comparison. It is determined by perceived value and not quantifiable criteria.

Job Classification is used usually by the government to set their grading structures. In this system, the job is measured against pre-existing set of job classes designed to cover the full range of jobs. In other words, broad descriptions are designed in advance to reflect the characteristics of the various jobs. Existing jobs are compared with these generic job templates and matched closest to the one that best describes the job. The classification system is relatively inexpensive and easy to administer. As the level of jobs become unique and complex in the new business world, it will be difficult to create generic job templates that cover unique Senior Management

Middle Management

Junior Management

Senior Technical

Supervisory

Senior Clerical

Technical

Skilled

Clerical

Semi-Skilled

FIGURE 8.3 | Job Classification

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competencies and qualities. In the absence of these generic job templates, it is difficult to place them in a job category. They are broadly placed without any direct rationale. Moreover, it is difficult to explain the rationale of relating the unique job to an existing generic job template to the job holder or others. The challenge is to determine what jobs fall in which category. In the hospitality industry, most jobs have, through the process of evolution, fallen into place. The difficulty comes when we are dealing with specialists. Where does a Chef, Facility Planner, Horticulturist, Florist, Tennis coach fit in? This is most difficult to explain to employees. There is a suspicion of bias. Some jobs may lose their earlier ranking as business strategies change. For instance, an IT specialist may demand a management position if the organisation is embarking on major computerisation. He may feel that he is the most important in the organisation strategy.

Point-factor is the most reliable and popular method used these days. In this system, a variety of job factors are evaluated and given points. The factors chosen relate to the business strategy, work performed, and the conditions under which they are done. After the factors are chosen and described, they are weighted in importance to other factors as all factors are not equally important to the organisation. For example, in the hospitality industry, factors such as customer interaction, level of skill to provide service, and decision making may carry a heavier weight than working conditions or degree of risk. The rating is done by in-depth interviews with existing job holders, their superiors, and their peers. The rating is done in a pre-determined questionnaire that gives values (points) and weights (worth) to each component of the job. Other factors could include physical effort required, level of risk, knowledge, skills, competencies, and experience. It also takes into account external and internal relationships and the level of importance in a process. Once the position evaluation is complete, the point scores on each factor are totalled. The more valuable the job is, the higher is the total score. As a result of this rating method, jobs with similar points that fall in a hierarchy of points, can be identified. Point-factor evaluation does not compare jobs as in a ranking system which relies on the perceptions of rankers, but actually first establishes the worth of the job in terms of weighted points and then compares the jobs. As a matter of fact, the total points automatically throw the job into job clusters of similar worth. Typically, point-factor system evaluates jobs in a job family in order to attain equity. A job family is a group of jobs having the same nature of work, with common vocations, behaviours, within a continuum of knowledge, skills, and competencies For example, guest contact, clerical, engineering, management, supervisory, skilled, etc. Each job family has similar skills, effort, responsibility, working conditions, etc. So, a receptionist in the front office has guest contact just as a counter salesperson in the delicatessen. However, the knowledge and skills to be a receptionist is superior to that of a counter salesperson. The same receptionist requires higher mental capacity to process information than a bell-boy who is also guest contact, but requires more physical competencies than mental competencies. The point-factor has a higher degree of integrity when explaining to the employee the job worth. This is an expensive method requiring certified skill. It is also a time consuming process. While there have been several attempts to create a point-factor evaluation format, the Hays System reigns supreme. (see “Job Evaluation” in Chapter 10 for details). Benchmarking is another job evaluation method which by making comparisons with external works practices. It is the process of setting financial values to the job hierarchy. The most common method is to benchmark with the competition. Each job cluster is compared to what the market pays. This is done to attract the same pool of talent in the market. Hospitality organisations may, however, adopt the following strategies when benchmarking with competition: 1. Be the market leader. This means paying the best in the market and continuing to upgrade the salaries to be ahead of competition. The benefit of this strategy is that the company will attract the

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best talent. This strategy is employed by quality hotels that set the lead in all aspects of their operations. They will have the highest room tariffs as also superior services and facilities. The quality human resources will support quality service and bring in unique innovation. The downside of this strategy is that the payroll costs will be high with the hope that revenues will offset the cost. 2. Be the market follower. In this strategy the organisation pays at the same level as the competition. This strategy is employed by organisations that have other strong reasons to attract good talent. This could be the brand name, chain affiliation, better growth prospects, financial stability, continuous training and development process, career plans, and the opportunity to express oneself. Most organisations adopt this strategy. 3. Be lower than the market. This strategy is adopted because of cost considerations. The organisation does not necessarily mean to hire sub-standard human resources, but is proud of other aspects of the organisation such as brand name, professional HRD processes, happy working environment, progressive organisational culture, opportunity to learn, etc. Such organisations may recruit students fresh from hotel school and have a strong training and development set-up to bring them at par with performance requirements in a short time. They have motivational schemes and quick career progression. Organisations in this strategy give a quality of work with job challenges well ahead of time. Candidates are willing to take a lesser initial pay to join reputed organisations in the market. Benchmarking is done through compensation survey. The survey may be conducted by several means:

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By in-house resources who may get informal information through networking with employees of the competition. Organisations may commission an outside agency to conduct one. They may get the information from recruitment agents who get their data from candidates that they interview or through their own compensation surveys. Purchase compensation surveys from consultancy houses. Consultancy houses conduct such surveys periodically and sell the information. A common method is to encourage a group of hotels of similar standards to share their salary information in a limited survey which is privy to only the participating hotels. Government agencies like the local Chamber of Commerce, Labour Department, or Employment Agency. The Hotel and Restaurant Federation may also have some useful information. HRD Departments also study job advertisement columns and keep a record of salaries offered.

Naturally, the surveys must follow certain norms: l

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They must compare with similar properties in terms of size, classification (1 star to 5 star), market segments, and location. They must compare like-to-like jobs. Some hotels only compare key jobs of job families and extrapolate the salaries of others. The job contents of the jobs must be similar. Some job titles may be similar, but may have enriched or enlarged jobs that may distort roles. The comparison must be with relevant markets—local, regional, national, or global. The survey must go beyond just basic salary. The other benefits may compensate for lower salaries.

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The survey must take care of salaries at different stages of experience such as entry level, after three years, after five years, etc. The salaries must compare with the market average. Some properties may display above average compensation, while others will show low salaries. The average is a good yardstick. The compensation survey acts as a benchmark only and not an end in itself.

Pay Structures The final stage is developing a pay structure. The pay structure must respond to the company’s compensation philosophy, policies, and strategies.

Traditional Pay Structures The pay structure is then evolved by developing overlapping pay ranges with a minimum, mid-point, and maximum limits. These ranges are called grades. The job hierarchy will have a cascade of grades. Normally, a person entering a grade should start with the minimum of the grade. However, this does not always happen, especially in a competitive salary environment. It was found that good talent were brought in higher in the grade thereby skewing equity with other positions. The organisation may adopt several strategies once the grades are set: 1. Have a single rate structure in which all the employees doing similar jobs will receive the same pay. This strategy does not differentiate between the good and the mediocre. The good are likely to leave if they are not differentiated from the rest. 2. Tenure-based strategy is one in which people are progressed along the grade according to the number of years of experience. This system recognises experience, but not necessarily quality of performance. Government establishments and bureaucratic organisations follow this system where the years put in earns the employee a higher remuneration. There is another problem as we have seen earlier. There are some employees who reach the maximum of the grade, but are not suitable for a higher grade. The person is doomed to stagnate. However, if the contributions of the employee in the existing job is still valued, then the organisation may think of extending the grade as a special case. 3. Merit-based plan: This is the one where good performers move quicker on the grade scale. Organisations may set increment norms such as: poor performance—no increment; average performance—one increment; above average performance—one and a half increment; and excellent performance—two increments. This is an improvement from the above strategies but again compensation is restricted to the amount of increments defined on the grade scale. Star performers would expect substantial incentives and may leave due to the slow progression of emoluments. 4. Performance-based Plans: These maintain the sanctity of base salaries, but give unusual financial rewards for good performance. Examples of these are bonuses, share in profit, stock options, merit rewards. This works well in modern times where contributions matter. 5. Productivity-based plans are those strategies where employees get a commission on sales generated. Some may operate on straight commission only while others may work on base salary plus commission. Naturally, these jobs have to be linked with sales.

Modern Pay Structures We have learnt by now about the sea changes that are taking place at the market place because of globalisation, competitive pressures, unpredictable business environments, changing workforce, the shift from the industrial age to the service age, and the demand for quality at the least cost. This

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has forced managements to shed traditional ways and look at more innovative ways to structure work, manage performance, and redefine leadership. This they achieve by having flatter structures, leaner workforces, letting technology improve efficiency, empowering the knowledge worker, team-based management, career plans, and coaching style of supervision. Job descriptions have been redefined to make work more enriched, enlarged, with more accountability and authority, more challenging and more result based. Naturally, the compensation structure has to change with the times. While the traditional approach to compensation had a sense of orderliness, rationality, and job value, employees today no longer have the patience with structured compensation considering their perceived short span of employment. Traditional approaches were competitor led and were reactive rather than proactive. With lesser job opportunities before, employees were ‘enslaved’ in organisations with mindsets to fight for their rights. The new age has brought about borderless career paths with a market place teeming with diverse opportunities, the biggest being the web-based entrepreneur. The new methods of compensation structures are as follows:

Broadbanding Broadbanding is the consolidation of several traditional grades into fewer expanded grades. So, if an earlier grade ranged from a minimum $400 to a maximum of $1000 the new grade would be a minimum of $400 to a maximum of $3000. This would include several higher grades. Broadbanding responds to several organisational strategies: 1. Reducing the number of layers in a hierarchy (flatter structures) 2. Reducing the number of people with the help of technology, thereby enabling the few to get higher salaries 3. Hiring star performers at any cost and yet fitting them in a grade 4. Expanding the traditional roles, empowering it with greater autonomy and authority 5. Ability to give merit pay to good performance 6. Have the ability to be flexible with rewards 7. Paying for roles and responsibilities, and not for titles.

Pay for Knowledge, Competencies, or Skills In this scheme, employees are paid for the degree of knowledge, skills, and competencies they have. These have to be supported by certification and testimonials. It works on the belief that these qualifications will translate into better job performance and results thereby adding to the bottom line. Qualified people with an attitude to improve effectiveness are more productive. This system decreases absenteeism, turnover, and accident rates. Good talent would add new knowledge and perhaps a competitive advantage. Pay structures in this system are benchmarked with qualifications rather than job positions. The grades are a cascade of qualifications. It typically starts with the entry level of a fresh person with a qualification and rises based on additional qualifications and knowledge gained as also the contribution to the bottom line. The benefits of this system are: 1. Employees feel rewarded for the time, effort, and money they spent in acquiring the knowledge. 2. People want to learn more and get additional certification to warrant higher pay. The result is that the organisation is constantly upgrading its knowledge capital. 3. The employees now push the organisation to invest in new opportunities to learn. The organisation is geared to continuous education. 4. Employees attain mastery in their field. 5. Employees are able to solve more complex problems with higher knowledge. 6. Employees are able to assume more responsibilities.

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7. The breadth of skills gets expanded giving the organisation greater flexibility in deploying resources. 8. Employees are able to manage themselves better. They need little or no supervision. This gives the organisation confidence to fix accountability. This leads to a greater empowered workforce. 9. Cross-training gives the organisation greater flexibility of deployment of resources. 10. Employees take greater control and responsibility for their own development. They expect the organisation to give sabbaticals to enhance their knowledge and skills. They hope that organisations give incentives for such upgrade through partial fees re-imbursement or sponsorship. They can also avail of company loans. 11. In this system, fewer supervisors are required. Certain layers of supervision can be removed, thereby delayering their hierarchy. 12. Employees take control of their own compensation growth. The great challenge of the organisation using this system is to define the outcomes (results) desired that warrant the compensation for knowledge which is usually higher than the traditional grading system. The outcomes must justify the high salaries. The other challenge is to constantly use the corpus of knowledge available. Non-use is an under utilisation of talent that can get rusty. A very real concern for organisations that adopt this system is to provide meaty roles and growth with the increase of knowledge.

Team Pay Plans There is a move by organisations to make teams responsible for results. While each team member gets a base pay, they can augment their compensation with team bonuses. The rewards are targeted towards the team who will distribute the spoils among themselves based on individual contribution to the outcomes. Of course, the acceptable team behaviours have to be defined and the quantum of outcome has to be determined. This system works, but brings fierce competitiveness between groups. Groups tend to develop mini-empires where a lot of dysfunctional behaviour is covered up. One way is to change team compositions frequently that give the organisation greater flexibility in team compositions. However, it does not allow a team to settle into a rhythm.

Summary Compensation is witnessing a major change from traditional methods. Traditional organisations adopted a ‘cradle to grave’ policy that looked at lifelong employment. They took care of the employee and the family needs completely. Compensation then comprised a basic salary established through benchmarking and/or job evaluation and benefits that took care of the physiological and social needs of the employee. Modern organisations and employees have shed long-term associations and now work together to convert competence and expertise of the employee to mutual advantage. The knowledge worker expects handsome pay to compensate for short career spans and is even willing to invest in his/her value to the organisation through continuous education. New workers are willing to work hard and take ownership of results. Once those results are attained the worker expects good rewards. Organisations can adopt traditional or modern compensation practices according to their circumstances. However, the market is going to determine the way it compensates good talent.

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Key Terms Compensation Basic Salary Salary Grade Benefits Job Family Benchmark

All forms of financials and benefits paid to employees for their contributions Root value of a job The maximum and minimum value of a job along a monetary scale Financial and non-financial elements that improve an employee’s quality of life A group of jobs having the same nature of work The best standard

Review Quiz Short Notes 1. 2. 3. 4.

How does money influence a modern employee’s thinking? What are the job evaluation methods available? What are the modern methods of compensation? Write short notes on: (a) Tenure-based compensation plan (b) Employee benefits (c) Job Family (d) Benchmarking strategies (e) Job Classification 5. Explain the statutory and discretionary benefits of an organisation.

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9 Head Neck

Employee Health and Safety

Arm Hand Elbow

Leg

Shoulder Wrist Back Hip

Knees Ankle

1. OCCUPATIONAL HAZARDS Most jobs in the hospitality industry are physically demanding. This requires a level of physical fitness. Employees in customer contact jobs are on their feet for a full shift of 8 hours during which they perform various tasks that are demanding on the body. Room attendants have to stoop, squat, kneel, etc. several times in a shift when preparing their allotted rooms. The main concerns arise out of physical workload; excessive bodily motions; and awkward positions that put a strain on the back, limbs, shoulders, and neck. On a typical day, skilled employees in a hotel would be: l

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Walking: Consider the miles that public area personnel will cover when cleaning the length and breadth of a hotel. The gardeners will be walking long distances to care for landscapes and gardens. Standing: Most hotel employees are on their feet in a full shift. The receptionist has to stand behind the counter for long hours just as a counter salesperson at the pastry shop. Stooping: Room attendants will need to stoop to pick garbage from floors; to clean bathtubs and closets; and to get linen from bottom shelves of maid carts; to tuck in corners of bed sheets in guest rooms; etc. Kitchen stewards have to stoop to pick up heavy pots and pans as well as gas cylinders. Squatting: Gardeners will need to squat for long hours while preparing flower beds and planting seeds. Their work at the nursery involves long hours preparing flower pots for indoor decoration. Kneeling: Room attendants would kneel while cleaning bathroom floors. Public area staff would do the same to clean stubborn stains from floors and staircases. Stretching: Linen keepers and storekeepers will stretch to get supplies from higher shelves. Room attendants would stretch to clean the upper reaches of bathroom tiles and mirrors. Reaching: All employees will have to reach for something or the other. Waiters have to reach to serve guests. Linen and uniform keepers have to reach for items in exchange; the florist while doing the flower arrangements; etc. Twisting: Public area cleaners have to twist their torso to clean areas around them to achieve maximum productivity. So do cooks who have to move continuously between kitchen equipments. Crouching: This is required to clean lower reaches of furniture like dining table legs, lower wardrobe shelves, etc. Gardeners have to crouch to tend to floor indoor plants, etc.

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Lifting: Waiters have to lift trays; bellboys have to lift guest luggage; and room attendants have to lift weighty linen off beds and maid carts; housemen have to lift heavy furniture and carpets; public area housemen have to lift furniture to re-arrange it; gardeners have to lift potted plants; and the list goes on. Pushing: Housekeeping personnel have to push maid carts; waiters, service trollies; laundry personnel, the linen hampers, etc.

The above are only sample situations when the body is under pressure. There are countless numbers of other situations in a shift that truly challenge all employees. Statistics show that a room attendant changes body position every three seconds while preparing a room. If we assume that the average cleaning time for a room is 40 minutes and she does 16 rooms in a shift she would end up doing 8000 different postures every shift. It can be classified as “heavy” to “very heavy” work because the energy required is approximately 4 kilo calories per minute. The question then arises, how do we reduce this physical stress on employees and who is responsible to do this. The HRD department drives the health and safety concern of employees, though all management is responsible in their respective departments. The following suggestions to reduce physical stress are useful.

Suggestions to Reduce Physical Stress 1. Lighter equipment can reduce work. While purchasing equipment, one of the criteria would be its lightness. Also, all heavy equipment must be on wheels. Portability helps greatly in work management. 2. Motorised equipment like the vacuum cleaners helps in relieving the effort. Motonsed lawn mowers can help mow grass in long stretches. With the same intention, mops and brooms must have long handles to reduce stooping, crouching, and kneeling that contribute to musculosketal injuries immediately and in later years. 3. Modern detergents help in cleaning spots and stains easily with a swipe that may eliminate tedious scrubbing. The housekeeper must constantly research the market for new developments and encourage trials when suppliers arrive at the door step. 4. Job Rotation is one possible approach to prevent permanent injuries. It requires workers to move to different tasks to allow muscles already stressed to rest. Employees can perform other administrative duties just for a change in body movements. 5. Job enlargement is a credible alternative where the scope of tasks is broadened to give balanced exposure. For example, public area cleaners can be asked to do some administrative duties like general supplies; cleaning equipment; issue of equipment from stores; etc. 6. Teamwork is a wonderful idea when teams plan their work and help each other out. Tasks can be shared like housemen doing the vacuuming of rooms or supervisors helping in replenishing maid carts. 7. Education and training in safe work practices must be part of an ongoing agenda. Training must concentrate on removing bad habits and replacing them with improved work habits.

2. PREVENTION OF WORK HAZARDS Let us examine the areas where accidents take place: 1. Falls from slippery floors; make-shift ladders; cluttered work areas; and improper carpet lay out 2. Cuts from broken glass in linen bundles and garbage 3. Back pains from improper working postures

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4. 5. 6. 7.

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Muscle cramps from improper lifting Breathing problems and burns from the use of hazardous chemicals and detergents Electrocution from live electric wires and improper maintenance or use of equipment Injuries due to improper work habits.

Let us look at each of these and examine how to prevent them.

Falls It is customary nowadays to put the sign “Wet Floor” whenever wet cleaning is done. This protects both guests and employees. It protects hotel management from litigations due to injuries caused by accidents. Ladders are key tools for cleaning high places or reaching higher shelves. Ladders come in many sizes from step stools to extended ladders. Ladders must be stable and strong. The rungs must be well fixed and any loose rungs must be attended to immediately before use. Ladders come in wood and aluminium. It is better to use aluminium ladders as they are light and look better than wood in public areas. The base must have rubber footing to prevent slippage. Ladders come with support rods so that they do not have to lean against walls. Should the ladder be without support, it should be inclined at one-fourth of its length from the wall. The person climbing must have his hands free and should climb while facing the ladder. The employee should not climb to the top of the ladder to prevent the ladder from becoming top heavy and losing balance. It is preferred to climb leaving the last two rungs. Employees must position the ladder so as to reach the desired spots easily. Over-reaching can cause imbalance of the ladder. It is preferable to have someone hold the ladder from below even if it has support rods. The helper can pass tools as well as caution passers by from walking under the ladder. It may be prudent to put a sign—“Do not walk under the ladder.” Employees must be prevented from using make-shift ladders like packing crates or chairs. Cluttered workplaces can cause falls. Employees must keep their areas free for easy traffic. Tools and articles must be kept against walls in corridors. Curled carpet ends can cause trips and falls. Usually hotels use synthetic carpets that are stuck to the floor to prevent curling. However, due to heavy traffic ends may come loose and can pose a hazard. The housekeepers must be vigilant in their daily inspections towards these carpet ends and immediately have them re-glued to the floor. Rugs can show curling over time. It is prudent to turn them over for a while so the edges regain their natural fall on the floor.

Cuts Any heap whether linen or garbage is a potential hazard especially with regard to broken glass or exposed syringes. The cleaners must not place their hands into garbage heaps. Dust bins must be emptied completely into the garbage hamper of the maid’s cart. Room attendants are trained to shake soiled linen for guest belongings in occupied rooms. This is a good precaution as it also ensures that broken glass or other sharp objects are not hidden in the folds.

Back Pains Back pains are a common complaint among housekeeping, bell desk, and waiting personnel due to the sheer pressure on their backs while doing their daily chores. The secret is to keep the correct posture while doing work. A correct posture balances the neck, chest, and lower back in the natural curve. Those who have to stand for hours

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must do so in an upright position. It is good to circulate the blood by walking around for those like linen and uniform keepers and receptionists who have to stand for long hours in a fixed position at the counter. Back pains and cramps are also created by improper lifting. Most hospitality personnel have a lot of lifting to do throughout their working day. Here are a few tips for correct lifting: l l

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Tighten stomach muscles in preparation to lift. Bend at the knees and not the waist. Keep the head and back straight. The strong leg muscles help in the lifting process. Leg muscles are stronger than back muscles. Use both hands. Lift while hugging the load close to the body. Do not be over ambitious in carrying heavy loads. Carry loads that are comfortable and ones that you can get your hands around. Avoid twisting the body. Seek another person’s help for heavy loads. Walk with firm footing ensuring that the path is clear. One should be able to see ahead, over the load. Use the leg muscles again when lowering the load at the destination following the same steps as lifting.

Back pains and cramps are also caused by sudden movements like tugging or pushing heavy carts. Ensure that items are well oiled, after all, mechanical parts are meant to ease the work tedium.

Hazardous Chemicals Housekeepers normally use mild detergents for daily use. However, potent chemicals like acids and strong detergents are unavoidable for difficult stain treatment. Exposure to such chemicals can cause allergy, nausea, burns, vomiting, breathing problems, skin rashes, blindness, and even death. Cleaners must be trained in the safe use of these chemicals. Suppliers often provide the training and safety pamphlets for the use of these chemicals. Employees must be provided with safety goggles, gloves, and masks for operations that involve the use of hazardous chemicals. Another aspect is their storage. Housekeepers must make sure that these items are labelled properly and stored in separate areas in the store that is not easily accessible to everyone.

Electrocution There are several precautions to be taken to prevent electrical hazards. First, the purchasing must ensure that the equipment they buy has the ISI stamp of safety. This stamp is provided by local regulatory bodies confirming that equipment manufacturers have followed safety rules before they sell their equipment to clients. Second, all supervisors must ensure that the employees are properly trained in the use of equipment. The manufacturers are the best people to provide this training. The supervisors must release the employees for such training as it is not only a safety precaution for the employee, but also for the equipment to ensure their long life. Third, employees using the equipment must take the following general precautions: l l

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Never operate them in water (unless specifically built for water), as it is a deadly conductor of electricity. Ensure that connections to sockets are made with proper insulated plugs and not with open wires. Connections must be made by holding the plug firmly. The same must be followed when unplugging the appliances. Switch off equipment as soon as the sparks, smoke, or flames are observed.

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Cords must be uncoiled before using the equipment. They should not be kept loose to prevent falls in traffic areas. Cords must not be stretched beyond their length. Extension cords are handy to extend their lengths. The employee must check all appliances like guest room television, coffee machine, and mini-bar for loose connections. Lamps must also be checked and faulty connections reported to maintenance. Most open plug points nowadays have in-built safety features. However, if there are sockets without safety features, they must have proper covers.

All department heads must also ensure a preventive maintenance schedule for the upkeep of equipment.

Proper Work Habits Many injuries are caused by poor work habits. These can be corrected by proper training. Employees can follow the tips given below: l l l l l l l

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Smoke in designated areas only and never in the elevator. Ensure that elevators are not overloaded and keep to the limits as indicated in the cabin. Use the correct equipment and accessories for cleaning. Do not operate equipment when not trained. Use accessories like gloves, masks, and goggles when dealing with toxic material. Use ladders, not crates and boxes, for climbing. Look for broken glass when cleaning. Dispose it in broken glass containers only, and not in garbage bags or dustbins. Do not use bare hands to dip into trash cans for fear of cuts from glass or razor blades. Use the handrails while climbing steps. Untangle cords of equipment before use and keep them away from pathways. Report any safety hazards if they cannot be rectified by the self. Rely on maintenance to complete fixing jobs. They are the experts. Check equipment for serviceability.

Supervisors’ Responsibilities towards Safety Supervisors are responsible for the safety of their employees. It is, therefore, imperative for them to ensure safe conditions and practices in the department. Here are some guidelines towards safety. 1. 2. 3. 4. 5. 6. 7. 8. 9.

Prepare a safety manual that is read and understood at the time of induction of new employees. Paste safety rules on walls at strategic points in the work areas. Reinforce safety rules in daily briefings. Ensure that all equipments bought have the ISI stamp of safety and reliability. Organise continuous safety training. Involve experts like the equipment manufacturers; occupational safety department of the government; fire safety officials; and the municipal health department. Build safety into all job descriptions. Have a preventive maintenance programme for all equipment. Include safety inspection in the supervisor’s daily cleaning checklists. Declare rooms and public areas unsafe for use till safety faults are rectified.

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10. Make sure that safety equipment and accessories are always in stock. 11. Ensure that toxic chemicals are stored in closed cupboards and properly labelled. 12. Ensure that all waste disposal containers are leak proof and maintained in sanitary conditions. Waste disposal external to the building must be in designated municipal areas and with concern for public health. Also oversee that cleaners put recyclable items in their appropriate containers. 13. Make sure that locker rooms have proper washing and shower facilities, with adequate supply of soap and towels. Locker rooms must be kept clean and dry at all times. Water closets must be sanitised frequently. 14. Ensure that employees consume food and beverage in the staff canteens and not the public areas. 15. Keep a timetable that ensures rest breaks for employees during their shift vigil. 16. Keep appropriate signs at hand to caution guests and employees towards safety. Signs include caution signs like “Wet Floor;” labels for detergents and toxic material; safety instructions on equipment.

3. FIRST AID It is important for all employees to know about first aid as they could be the first ones on the spot to give immediate attention to a guest or employee. It is part of the overall safety programme. Many hotels organise training classes, run by the Red Cross or St. John’s Ambulance or similar health organisations, for their staff who are awarded certificates in recognition of having completed a first aid programme. This shows the importance hotels and restaurants give to skills of first aid as inherent to employees’ jobs. Large hotels may have their own basic clinic with a qualified nurse. The first step is to have a first aid cupboard or box in a central location in each department. The cupboard could be located at the desk control room; reservation back-office; chef’s office; engineering control room; bell-desk; etc. for easy accessibility. The cupboard normally contains the following items: 1. 3. 5. 7. 9. 11. 13. 15. 17. 19.

Clinical thermometer Bandage roll ½”, 1”, and 2” Sterilised gauze Bed pan and urine bottle Safety pins Tincture enzoine Dettol Crocin tablets Mercurochrome Antiseptic creams

2. 4. 6. 8. 10. 12. 14. 16. 18.

Cotton wool Adhesive dressings (band-aids), etc. Tweezers Rubber sheeting Tincture iodine Junction violate solution Burnol or Furacin Aspirins Fruit salts

The cupboard should be cool and dry and clearly captioned for easy identification. Following are some immediate steps that can be taken towards first aid:

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First Aid Steps 1. Burns and Scalds

2. Bleeding

3. Clothes on Fire

4. Fainting

5. Fracture

6. Heart Attack

7. Object in Eye

(a) (b) (c) (a) (b) (c) (a) (b) (c) (a) (b) (c) (a) (b) (c) (a) (b) (c) (d) (a) (b) (c) (d)

8. Sprain

9. Shock

(a) (b) (a) (b) (c) (d)

Apply Burnol liberally Place burnt area under cold running water or ice. If burns are serious, apply sterile dressing and send to hospital immediately. Clean wound with cotton dipped in Dettol. Put dry antiseptic dressing or tincture iodine for bigger wounds. Put pressure on wound by placing gauze on it and bandaging the area tightly. Prevent person from running Smother flames by wrapping victim with a heavy material, e.g. curtain, blanket or heavy coat. Treat burns as above Loosen clothing Lay victim flat on the back with feet raised or place in chair bending the head forward between the knees. Apply warmth to lower limbs and rub them upwards. Immobilise both limbs by tying both legs and the arms across the body respectively. An alternative is to get two boards and tie legs/arms between them. Send for the doctor. Call for a doctor immediately. Do not move person from the room. Clear the room of people. If critical, try artificial respiration by mouth-to-mouth method. Do not rub the eye Use an eye bath with warm water to rinse the eye. If no improvement is noticed, check eye against the light and locate foreign matter. Remove it with the corner of a clean handkerchief. If foreign matter is embedded in the eyeball do not try to pick it out. Drop two drops of castor oil in the eye, cover the eye with a soft pad, bandage lightly and take to a doctor. Apply dry bandage firmly wrapped round the affected part and soak with cold water. Rest the limb. Rest the patient by laying him or her on a couch Loosen clothing Give warmth with hot beverage and hot water bottle. Keep the surrounding area silent.

Recently, local occupational hazard authorities of each country are making assertive legislation to ensure safe working conditions at work places. They issue certain rules and processes that hotels have to comply with. Some of these essential requirements are: 1. Employers have to build in the safety guidelines issued by the authorities and sign a declaration of compliance. Authorities make announced and unannounced inspections to ensure this on a continuous basis.

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2. Employers have to declare the person or persons who are responsible for implementing and monitoring the safety rules set by the authority. 3. Employers have to declare the job positions that are exposed to hazards. They have to write the safety procedures for these positions. 4. Employers must keep records of accidents and illnesses caused by occupational hazards that will be studied by the authority’s compliance officers. 5. Employers must permit inspections announced or unannounced to the authority’s inspectors. 6. Employers must inform the concerned employees about the hazards in their jobs. 7. Employers must declare the chemicals and detergents stored in their property as also their storage conditions. They must keep physical inventories and dates of issue. Chemicals include detergents, alkali, emulsifiers for degreasing, flammable material like polishes and cleaners, fungicides, adhesive materials and pesticides. 8. Employers must label all such toxic materials and mark them with the symbol “X.” 9. Employers must procure safety manuals from manufacturers and make them available to employees. 10. Employers must conduct safety training programmes and keep records of all such training for inspection. They must list the names of all employees who go through these training programmes. 11. Employers must display safety signboards and safety instructions in prominent places. Some of these displays are provided by the authority itself. 12. Manufacturers must supply the employer with details of ingredients in chemicals supplied. They must also mention the potential hazards on users, e.g. health, fire, explosive, radiation, etc. and safety precautions to be taken.

4. FIRE PREVENTION In dealing with this subject, it is necessary to understand that it falls into two separate categories—fire prevention and fire-fighting.

(a) Fire Prevention Fire prevention includes those steps that are taken to ensure that fire does not occur. One of the most important requirements for fire prevention is good housekeeping. Housekeeping and the maintenance department coordinate to make the public areas and guest rooms free from fire hazards. Housekeeping personnel permeate all parts of the hotel during the day and night, and are, therefore, the eyes of the property in preventing, locating, and reporting fire. The chief engineer, on the other hand, is the chief fire officer to fight fire in the hotel. He lends support in fire prevention by organising and supervising fire drills for all staff. He is responsible for the fire fighting equipment and training his maintenance team to work as fire patrols as well as fire-fighters. Given below are some of the fire prevention methods:

Stairs In most hotels, the stairways used as the service stairway is also the fire escape stairway. Stairways are hazardous even under the most favourable conditions. It is important to keep steps clean and free of oily substances that may cause slipping. Steps and rails must be kept structurally safe. Passageways should always be kept well lit and clean and free of obstruction and debris. Keeping stair shaft areas clean and bright with

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suitable light coloured paints helps a great deal in promoting general safety. Most stairways lead to fire escape doors that are different from the usual exit doors. These doors have a push lever to exit. These doors must be kept clear and only used for fire emergencies.

Care of Fire Extinguishers Fire extinguishers may be rarely or never used. However, when they are needed, it is an emergency, and they must always be in working order. All fire apparatus, including extinguishers, hoses, valves, and sprinkler systems should be inspected semi-annually and carry tags indicating the date of inspection and the initials of the inspector. This work is delegated to trained maintenance department employees or an outside contractor. Used extinguishers and hoses should never be reused unless they have been properly serviced. In the case of a woven fire hose, the procedure involves stretching the hose flat and drying it thoroughly before replacing it. If this procedure is not followed, weak spots will develop which rupture the hose the moment water pressure is applied. Tank type (soda acid, fog, and foam) extinguishers must be recharged. This work should be done by experienced professional people. In addition to the periodic inspection described above, it is necessary that the soda acid extinguishers be tested at least every two years to ensure the solidity of the outside container and to ascertain the condition of the discharge hose and nozzle. These tests will avoid the possibility of explosion which can occur where tank bodies are weakened by corrosion or blocked nozzles. Both housekeeping and maintenance department employees should constantly be on the alert to ensure that fire extinguisher stations are not used to store or serve as temporary resting places for room service trays or cleaning materials.

Fire Regulations In following the suggested procedure outlined above, each hotel should develop a set of fire regulations. These regulations should be printed, framed, and posted adjacent to every extinguisher and on service landings and personnel locker rooms.

Fire Detection Systems All hotels nowadays have to comply with fire safety regulations. This requires certain equipment to be installed as also people training. Unless this is in place, the hotel is unlikely to be given its licence. Many hotels are under threat of having their licence revoked if fire safety is not attended to on an on-going basis. The main hardware that is required to be installed are fire detection systems. There are different methods of detecting and dealing with fire:

Fire Alarm Systems The fire alarm system is a method in which alarm bells ring when activated. Hotels provide these fire push buttons enclosed in glass and painted in red at strategic points throughout the hotel. Normally, such points have hoses, fire axes, extinguishers, and sand buckets. They are all handy for the first person at the site of the fire. Fire alarm systems should be tested monthly. These tests might well be conducted in concert with employee drills. If an alarm has been pulled it should be reset and the glass replaced immediately following the fire. This is the responsibility of the chief engineer.

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The Chief Engineer ensures that the fire alarm system has an uninterrupted supply of electric power. He is responsible for ensuring that the system is connected to the emergency generator, or in the absence of such a generator, an alternate supply of power, such as batteries, which are properly connected and in working order.

Smoke Detection Systems Most hotel rooms have smoke detectors. Smoke detectors trip the alarm system if the smoke exceeds permissible limits. They set off alarms in fire detection panels located in the telecommunications room or the engineering control room. There are two types of smoke detectors: photoelectric and ionisation. Photoelectric systems go off when smoke obstructs a beam of light located inside the detector. Ionisation detectors sense smoke when there is a shift of electrical conductivity between two plates. Sprinkler Systems Sprinklers are set off by heat, not smoke. Therefore, even if the smoke detector indicates a fire the sprinkler will not be set off. The sprinkler system has sensitive glass bulbs that crack with a certain degree of heat letting loose open water valves that sprinkle water in the area. They are located in ceilings of guest rooms, public areas, linen room, and those areas prone to fire. The sprinkler systems are fed from dedicated water reservoirs that must be full at all times. Small hotels may create their swimming pool on the rooftop to act as a fire reservoir also.

Fire Doors Fire doors are provided, especially in long corridors, to seal off a section of the corridor affected by fire. Like other fire equipment, when the need arises, their proper functioning is very important. Therefore, they should be under constant observation and care. Fusible links and door closers should be inspected semi-annually and fire doors must never be blocked.

Fire Drills The HR department and the maintenance department should creat an internal fire brigade around a cadre of employees. At the time an alarm is called this brigade should be so organised that it can arrive at the scene properly equipped in less than two minutes. Employees of other departments such as housemen, maids, and waiters can be organised to assist in such tasks as removing furniture, directing guests, etc. Properly organised drills held on a monthly or bi-monthly basis can serve as a very effective weapon in preparing for a potential emergency.

Fire Protection Checklist The manager of each hotel should either personally supervise the use of a Fire Protection Checklist or delegate the responsibility for examining the checklist after the engineering department has made a survey. Items that are shown as ineffective as a result of the review should be promptly entered in a log book for correction. The management should follow up and insist that appropriate action be taken on every open item in the log book until the deficiency is corrected. A notation should be made in the log book when the defect has been eliminated.

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Item Monthly Checklist Corridors and Stairs Exits and exit lights Stairways and fire escapes unobstructed Stair doors are closed Fire alarm boxes and hoses unobstructed Fire extinguishers in position Fire extinguishers full Fire doors and shutters checked Fire alarm system checked Bottom of fire shafts clear Exit signs lit Fire appliances visible for use Emergency lighting systems checked Rooms Cords of floor lamps checked Fire escape plans behind doors Sprinkler control valves open Air conditioning filters cleaned Kitchens Kitchen hoods clean Waste behind kitchen equipment removed Gas pipes checked Power sockets checked Housekeeping and Laundry Detergent and Chemical store locked Detergents and chemicals labelled Upholstery shop fire hazards checked “No smoking” signs in restricted areas Public ashtray bins provided Laundry steam pipes checked for leaks Electrical wire system check Fire Pump Operations Fire pump operating Water supply lines are clear Watchman’s time charts checked Electrical load checked Fire water tank full Semi-Annual Checklist Number of fire drills Safety of documents Electric motors cleaned Central heating checked Kitchen range extinguishing system Vent ducts cleaned

FIGURE 9.1 | Fire Protection Checklist

Date Checked

Log Page Number

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(b) Fire Fighting Housekeeping personnel most probably will be the first to locate a fire and will have to take the initial steps in the fire fighting chain. In the first instance, they need to know how to classify fires and the methods of extinguishing them. Some fires call for a wetting and cooling method below the ignition point. Others require a blanketing effect which either excludes or dilutes oxygen to a point where it will not support combustion.

Classification of Fires For all practical purposes there are three general classes of fires:

Class A Fires occurring in ordinary dry combustible materials such as wood, textiles, paper, rubbish, etc. In these fires, the quenching and cooling effect of all quantities of water or solutions containing a high percentage of water are of first importance. Class B Fires caused by inflammable liquids such as oils, grease, petrol, chemicals, etc. In these fires, a blanketing effect is essential. Class C Fires caused by electrical equipment and short-circuits that require non-conductive agents to extinguishing them. To deal with such emergencies, experts have developed fire extinguishers to deal with initial fires of a low to medium magnitude:

Types of Extinguishers There are three types of extinguishers for hotel industry purposes. They are classified by the type of fire they are good at extinguishing. One must understand that as fires grow, other combustibles may ignite needing all three types of extinguishers. Most hotel fires have been caused by electrical short circuits. Class A fires require soda acid extinguishers, which eject water under gaseous pressure when they are inverted. They involve fires of wood and paper materials. Their use is limited to smaller fires since they contain only two and a half gallons of water. Water from hoses is used when fires are beyond the capacity of small extinguishers. Class B fires require carbon dioxide fog or foam extinguishers for liquid, grease, and oil fires. Class C fires require carbon dioxide fog as the preferred extinguishing agent since it is non conductive. These are used for electrical fires. Care must be exercised in using carbon dioxide extinguishers. The nozzle should never be touched with bare hands when the extinguisher is in operation.

Distribution of Extinguishers The following suggestions ensure the adequacy of protection over given areas:

Class One Extinguishers These are placed in areas of light occupancy such as offices or light public areas. There should be one fire extinguisher for every 5000 square feet, so located, that an individual will not be required to cover more than 100 feet to reach the nearest extinguisher.

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Class Two Extinguishers They are located in high occupancy, where fires of a broader extent may be anticipated, such as kitchens, boiler rooms, etc. Locations of this nature should have an extinguisher for every 2500 square ft., so located that an individual will not be required to cover more than 50 feet from any point to reach the nearest extinguisher. Class Three Extinguishers They are positioned in hazardous work areas such as woodworking shops, upholstery shops, paint shops, etc. This class should be protected with one extinguisher for every 2500 square ft., so located that an individual would not be required to travel more than 50 feet from any point to reach the nearest extinguisher; plus special extinguishers in confined areas for special hazards. It is to be understood that fire hose racks connected to standpipes or emergency water supplies are included in the extinguishers mentioned above.

Suggested Procedure Following is a suggested sequence to enable hotels to develop their own fire fighting procedure. Circumstances may not always permit adherence to all points in this line of approach, but it should prove to be advantageous as a guideline. 1. Close windows and doors of the room in which the fire has started. If in a general area, close doors to all surrounding rooms. 2. Ascertain the extent and seriousness of the fire. 3. Ring the fire alarm box or call switchboard operator for internal assistance. Remember that it is advantageous to avoid the hysteria which accompanies a general fire alarm by comforting people that help is on the way. 4. Inform the telephone operator and give a quick accurate description of the location of the fire as well as location of extinguishers. 5. Employees of the maintenance department should proceed to the location of the fire with extinguishers from their department as rapidly as possible. A fire cart is recommended. 6. Employees of the maintenance department should consider it their duty to remove all combustible or volatile material from the fire area. 7. The first consideration must always be for the safety and peace of mind of the guests. All personnel in contact with guests must maintain an attitude of calm and reassurance. 8. If the fire is in a guest’s room, the guest should be evacuated immediately into the corridor and the corridor doors and adjoining room doors should be closed. 9. It is recommended that the emergency stairs be used for evacuating guests.

5. EMERGENCY PLANS Introduction Nobody expects an emergency or disaster—especially one that affects them, their employees, and their business personally. Yet, the simple truth is that emergencies and disasters can strike anyone, anytime, and anywhere. Employees could be forced to evacuate the guests and employees of the hotel least expected. In these turbulent times, things like bomb scares; tornadoes; tsunamis; etc. that one hardly used to hear about before, have become part of our times.

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This chapter is designed to help employers plan for emergencies. The HR department is the key driver of such plans. The best way to protect oneself, the workers, and the business is to expect the unexpected and develop a well-thought out emergency action plan that guides everyone when immediate action is necessary.

What is a Workplace Emergency? A workplace emergency is an unforeseen situation that threatens employees, guests, or the public; disrupts or shuts down operations; or causes physical or environmental damage. Emergencies may be natural or manmade and include the following: l l l l l l l

floods, tornadoes, earthquakes, bomb scares, toxic gas releases, radiological accidents, civil disturbances, and

l l l l l l l

hurricanes, volcanic eruptions, fires, tsunamis, chemical spills, explosions, workplace violence resulting in bodily harm and trauma.

How do we Protect Ourselves, our Employees, and our Hotel? The best way is to prepare to respond to an emergency before it happens. Few people can think clearly and logically in a crisis, so it is important to do so in advance, when we have time to be thorough.

Brainstorm the Worst-Case Scenarios Ask yourself what you would do if the worst happened. What if a fire broke out in your boiler room? Or a hurricane hit your building head-on? Or a train carrying hazardous waste derailed while passing your loading dock? Once you have identified potential emergencies, consider how they would affect you and your workers and how you would respond.

What is an Emergency Action Plan? An emergency action plan covers designated actions that employers and employees must take to ensure employee safety from fire and other emergencies. Compiling an emergency action plan is a good way to protect everyone and the hotel during an emergency. Putting together a comprehensive emergency action plan that deals with all types of issues specific to your worksite is not difficult. It is beneficial to include the management team and employees in the process. The goals of protecting lives and property in the event of an emergency must be explained. Participating members will be required to establish and implement emergency action plans. Their commitment and support are critical to the plan’s success.

What should your Emergency Action Plan Include? When developing an emergency action plan, it is a good idea to look at a wide variety of potential emergencies that could occur at the workplace. It should be tailored to the worksite and include information about all

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potential sources of emergencies. Developing an emergency action plan means doing a hazard assessment to determine what, if any, physical or chemical hazards at the workplaces could cause an emergency. Multi-worksites will need a separate emergency action plan.

At a Minimum, an Emergency Action Plan must Include the Following l l l

l

l

l

A preferred method for reporting fires and other emergencies An evacuation policy and procedure Emergency escape procedures and route assignments, such as floor plans, workplace maps, and safe or refuge areas Names, titles, departments, and telephone numbers of individuals, both within and outside the company to contact for additional information or explanation of duties and responsibilities under the emergency plan Procedures for employees who remain to perform or shut down critical plant operations, operate fire extinguishers, or perform other essential services that cannot be shut down for every emergency alarm before evacuating Rescue and medical duties for any workers designated to perform these.

Consider designating an assembly location and procedures to account for all employees after an evacuation. In addition, it may be helpful to include the following: l l

The site of an alternative communications centre to be used in the event of a fire or explosion; and A secure on or offsite location to store originals or duplicate copies of accounting records, legal documents, your employees’ emergency contact lists, and other essential records.

How are Guests and Employees Alerted to an Emergency? The plan must include a way to alert guests and employees, including disabled guests and workers, to evacuate or take other action, and how to report emergencies, as required. Following steps should be taken: l

l

l

l

l

Make sure alarms are distinctive and recognised by all guests and employees as a signal to evacuate the work area or perform actions identified in the plan. Make available an emergency communications system such as a public address system, portable radio unit, or other means to notify employees of the emergency and to contact local law enforcement, the fire department, and others. Stipulate that alarms must be heard, seen, or otherwise perceived by everyone in the hotel. Such systems must have an auxiliary power supply in the event that electricity is shut off. Using tactile devices to alert employees who would not otherwise be able to recognise an audible or visual alarm. Providing an updated list of key personnel such as the telephone operator, maintenance engineer, security officer, or lobby manager in order of priority, to notify in the event of an emergency during off-duty hours.

How is an Evacuation Policy and Procedure Developed? A disorganised evacuation can result in confusion, injury, and property damage. That is why when developing an emergency action plan, it is important to determine the following:

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Conditions under which an evacuation would be necessary. A clear chain of command and designation of the person in the hotel authorised to order an evacuation or shutdown. The plan may designate an “evacuation warden” to assist others in an evacuation and to account for personnel. Specific evacuation procedures, including routes and exits. Post these procedures where they are easily accessible to all employees; guests have them on the back of the guest room door. Procedures for assisting people with disabilities or who do not speak English. Designation of which, if any, employees will continue or shut down critical operations during an evacuation. These people must be capable of recognising when to abandon the operation and evacuate themselves. A system for accounting for personnel following an evacuation. Consider employees’ transportation needs for community-wide evacuations.

Under what Conditions should an Evacuation be Called? In the event of an emergency, local emergency officials may order an evacuation. In some cases, they may instruct the shutting off of the water, gas, and electricity. For national disasters, it is prudent to listen to radio or television, listen to newscasts to keep informed and follow official orders. In other cases, a designated person within the hotel should be responsible for making the decision to evacuate or shut down operations. Protecting the health and safety of everyone in the facility should be the first priority. In the event of a fire, an immediate evacuation to a predetermined area away from the facility is the best way to protect employees. On the other hand, evacuating employees may not be the best response to an emergency such as a toxic gas release at a facility across town from the hotel. The type of building may be a factor in the decision. Most buildings are vulnerable to the effects of disasters such as tornadoes, earthquakes, floods, or explosions. The extent of the damage depends on the type of emergency and the building’s construction. Modern hotels, for example, are framed in steel and are structurally more sound than neighborhood business premises. In a disaster such as a major earthquake or explosion, however, nearly every type of structure will be affected. Some buildings will collapse and others will be left with weakened floors and walls.

What is the Role of Coordinators and Evacuation Wardens during an Emergency? When drafting the emergency action plan, select a responsible individual to lead and coordinate the emergency plan and evacuation. It is critical that employees know who the coordinator is and understand that person has the authority to make decisions during emergencies.

The Coordinator should be Responsible for the Following l

l l

l

Assessing the situation to determine whether an emergency exists and requires activation of your emergency procedures. Supervising all efforts in the area, including evacuating personnel. Coordinating outside emergency services, such as medical aid and local fire departments, and ensuring that they are available and notified when necessary. Directing the shutdown of engineering plant operations when required.

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The hotel may find it beneficial to coordinate the action plan with other employers when several employers share the building. In addition to a coordinator, designate evacuation wardens to help move employees from danger to safe areas during an emergency. Generally, one warden for every 20 employees (guests) should be adequate, and the appropriate number of wardens should be available at all times during working hours. Employees designated to assist in emergency evacuation procedures should be trained in the complete workplace layout and various alternative escape routes. All employees, and those designated to assist in emergencies, should be made aware of employees with special needs who may require extra assistance, how to use the buddy system, and hazardous areas to avoid during an emergency evacuation.

How to Establish Evacuation Routes and Exits? When preparing the emergency action plan, designate primary and secondary evacuation routes and exits. To the extent possible under the conditions, ensure that evacuation routes and emergency exits meet the following conditions: l l l l

clearly marked and well lit; wide enough to accommodate the number of evacuating personnel; unobstructed and clear of debris at all times; and unlikely to expose evacuating personnel to additional hazards.

Post layouts that show evacuation routes and exits at strategic points for all employees and guests to see.

How to Account for Employees after an Evacuation? Accounting for all employees following an evacuation is critical. Confusion in the assembly areas can lead to delays in rescuing anyone trapped in the building, or unnecessary and dangerous search-and-rescue operations. To ensure the fastest, most accurate accountability of employees, consider including these steps in your emergency action plan: l l

l l

Designate assembly areas where employees should gather after evacuating. Take a head count after the evacuation. Identify the names and last known locations of anyone not accounted for and pass them to the official in charge. Establish a method for accounting for non-employees such as suppliers and customers. Establish procedures for further evacuation in case the incident expands. This may consist of sending employees home by normal means or providing them with transportation to an offsite location.

How to Plan for Rescue Operations? It takes more than just willing hands to save lives. Untrained individuals may endanger themselves and those they are trying to rescue. For this reason, it is generally wise to leave rescue work to those who are trained, equipped, and certified to conduct rescues.

What Medical Assistance should be Provided during an Emergency? If the hotel does not have a formal medical programme, investigate ways to provide medical and first-aid services. If medical facilities are available near the hotel, make arrangements for them to handle emergency

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cases. Provide employees with written emergency medical procedures to minimise confusion during an emergency. If an infirmary, clinic, or hospital is not close to the hotel, ensure that onsite person(s) have adequate training in first aid. The Red Cross, some insurance providers, local safety authorities, fire departments, or other resources may be able to provide this training. Treatment of a serious injury should begin within 3 to 4 minutes of the accident. Consult with a physician to order appropriate first-aid supplies for emergencies. Medical personnel must be accessible to provide advice and consultation in resolving health problems that occur in the workplace. Establish a relationship with a local ambulance service, so that transportation is readily available for emergencies.

What Role should Employees Play in your Emergency Action Plan? The best emergency action plans include employees in the planning process, specify what employees should do during an emergency, and ensure that employees receive proper training for emergencies. During planning, encourage them to offer suggestions about potential hazards, worst-case scenarios, and proper emergency responses. After the plan is developed, review it with the employees to make sure everyone knows what to do before, during, and after an emergency. Keep a copy of the emergency action plan in a convenient location where employees can get to it, or provide all employees a copy.

What Employee Information should the Plan Include? In the event of an emergency, it could be important to have ready access to important personal information about the employees. This includes their home telephone numbers, the names and telephone numbers of their next of kin, and medical information.

What Type of Training do Employees Need? Educate employees about the types of emergencies that may occur and train them in the proper course of action. The size of the hotel and workforce, processes used, materials handled, and the availability of onsite or outside resources will determine the training requirements. Be sure all employees understand the function and elements of the emergency action plan, including types of potential emergencies, reporting procedures, alarm systems, evacuation plans, and shutdown procedures. Discuss any special hazards onsite such as flammable materials, toxic chemicals, radioactive sources, or water-reactive substances. To minimise confusion, clearly communicate to employees who will be in charge during an emergency.

General Training for Employees should Address the Following l l l l l l l l

Individual roles and responsibilities Threats, hazards, and protective actions Notification, warning, and communications procedures Means for locating family members in an emergency Emergency response procedures Evacuation, shelter, and accountability procedures Location and use of common emergency equipment Emergency shutdown procedures.

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Train employees in first-aid procedures, including protection against blood borne pathogens; respiratory protection, including use of an escape-only respirator; and methods for preventing unauthorised access to the site. Once emergency action plan are reviewed with employees and everyone has had the proper training, it is a good idea to hold practice drills as often as necessary to keep employees prepared. Include outside resources such as fire and police departments when possible. After each drill, gather management and employees to evaluate the effectiveness of the drill. Identify the strengths and weaknesses of your plan and work to improve it.

How often do Employees Need Training? HR should review plans with all employees and consider requiring annual training in the plan. Also offer training when doing the following: l l l

l l

Developing the initial plan Hiring new employees Introducing new equipment, materials, or processes into the workplace that affect evacuation routes Changing the layout or design of the facility Revising or updating the emergency procedures.

What does the Plan Need to Include about Hazardous Substances? No matter what kind of business is run, we could potentially face emergencies involving hazardous materials, such as flammable, explosive, toxic, noxious, corrosive, biological, oxidised, or radioactive substances. The source of the hazardous substances could be external, such as a local chemical plant that catches fire or an oil truck that overturns on a nearby freeway. On the other hand, the source may be within the hotel. Regardless of the source, these events could have a direct impact on employees, guests, and the hotel, and should be addressed by the emergency action plan. Hazardous substances have already been discussed earlier in the chapter. If the hotel has a store of hazardous substances, there is an increased risk of an emergency involving hazardous material which should be addressed in the emergency action plan. Occupational Safety authorities require employers who use hazardous chemicals to inventory them, keep the manufacturer-supplied Material Safety Data Sheets (MSDS) for them in a place accessible to workers, label containers of these chemicals with their possible hazards, and train employees in ways to protect themselves against those hazards. A good way to start is to determine risk from the hazardous chemicals kept in inventory and gather the MSDS for the chemicals. MSDS describe the hazards that a chemical may present, list the precautions to be taken when handling, storing, or using the substance, and outline emergency and first-aid procedures.

What Special Equipment should be Provided for Emergencies? Employees may need personal protective equipment to evacuate during an emergency. Personal protective equipment must be based on the potential hazards in the workplace. Assess the workplace to determine potential hazards and the appropriate controls and protective equipment for those hazards. Personal protective equipment may include items such as the following:

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Safety glasses, goggles, or face shields for eye protection; hard hats and safety shoes for head and foot protection; proper respirators; chemical suits, gloves, hoods, and boots for body protection from chemicals; special body protection for abnormal environmental conditions such as extreme temperatures; and any other special equipment or warning devices necessary for hazards unique to your work site.

How to Choose Appropriate Safety Equipment? Consult with health and safety professionals before making any purchases. Respiratory protection may be necessary if employees pass through toxic atmospheres of dust, mists, gases, or vapours, or through oxygen-deficient areas while evacuating.

Summary Occupational safety is a concern that has gathered serious attention. Most states have enacted laws that protect the employees from occupational hazards. All organisations would have to comply with legislation to stay in business. Occupational hazards include physical postures, chemical material, fire and proper use of equipment. The best precaution is to have emergency plans, proper training of staff in emergency procedures and investment in equipment that make the workplace safe.

Key Terms Occupational Hazards First Aid Fire prevention Evacuation MSDS

Dangers at work Immediate emergency medical attention at the accident site Precautions employed to avoid fire Removing people from dangerous environments Material Safety Data Sheet

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Review Quiz Short Notes 1. 2. 3. 4. 5.

6. 7. 8. 9. 10.

How can we reduce physical stress? What are the proper work habits that prevent accidents? What are the housekeeper’s responsibilities towards work safety? What are the items at a first aid station? What steps should you take in the following circumstances: l Bleeding l Clothes on fire l Fainting What are the classifications of fire extinguishers? What are the essential requirements of any local occupational hazard authority? What is the recommended fire-fighting procedure for a hotel? What minimum requirements are there in an emergency plan? What are the responsibilities of an Emergency Coordinator?

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10 Human Resource Best Practices Just like everything around us, HRD processes too have gone through significant change. The aim of this chapter is to introduce readers to some new innovations in HRD practices. While this is not an exhaustive list, the ones mentioned are certainly significant in making organisations more effective.

1. ASSESSMENT CENTRES An assessment centre is a procedure (not a location) that uses multiple assessment techniques to evaluate employees for a variety of human resource purposes and decisions (Thornton and Byham, 1982). This approach uses techniques like paper-and-pencil tests, questionnaires, and the use of background information. The main focus is on relevant behaviours displayed by those who are being assessed with the use of simulations. The term assessment centre means: l l l

the assessment centre method itself; a programme designed for selection, evaluation, and development purposes; an interaction with a person/(s) with the purpose of evaluation.

The evaluation is conducted by psychologists, behavioural scientists, practicing managers on the job and/or senior managers. In other words, the assessment is conducted by multiple assessors. HRD managers use assessment centres in the following circumstances: 1. 2. 3. 4. 5. 6.

To determine a candidate’s suitability for a job at the time of hiring To ascertain a candidate’s potential for career planning and development To ascertain an employee’s suitability in certain task assignments/projects To assess individual growth and development possibilities To ascertain if an individual fits into the culture of the organisation To ascertain an individual’s behaviour patterns in certain situations (especially guest contact)

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Assessment Centre Technology Basically the assessment centre simulates situations close to what a person will encounter while performing a job. This requires assessors to have a thorough understanding and analysis of the job. Assessors also have to develop criteria for the job. Assessment centre method consists of a series of exercises tuned to the job (future job) in question. They are simulations of the concerned job. Simulations involve creating real-life experiences in non-real environments. Some exercises involve groups where interpersonal interactions are observed. The information on behaviour is gathered in a standard controllable manner through a series of tests which are conducted in a step-by-step manner where each step is an entity in itself. There is also an evaluation at each step. These simulation exercises are supported by interviews and tests. Reports to the management by the assessment centre do not use psychological terms, but are written in business terminology that most managers can understand. Research shows that the simulation exercises combined with psychological tests provide reliable prediction about a person’s future behaviour. It is generally true that no single test can assess all behavioural criteria. The assessment centre method believes that the best way to get accurate evaluation of behaviour in a job is when an individual is put into a simulation close to the job. A simulation is closest to reality. The array of tests used is shown in the Table 10.1 below with the frequency of use. The list was made after reviewing 500 centres: TABLE 10.1 Array of Tests Used for Evaluation of an Individual’s Behaviour Assessment Exercise In-basket Assigned-role leaderless group discussion Interview simulation Non-assigned-role leaderless group Scheduling (for supervisory positions) Analysis (for higher positions) Management Games Background interview Paper-and-Pencil Tests Intellectual Reading Mathematics and Arithmetic Personality Projective tests

Frequency of Use in % age 95% 85% 75% 45% 40% 35% 10% 05% 05%

n n n

n

Source: Thornton and Byham (1982)

Let us look at some of the methods used above:

1%

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In-basket It is also called in-tray exercise. It consists of a basket of letters, memos, and other written notes that give typical incidents and situations that occur on the job. The individual is supposed to assess the particular problem and make decisions to solve the problem in a limited time. The situations are from real life and everyday job practice. The method evaluates the candidate’s management skills such as planning, organisation, written communication skills, and decision-making capability. It is best to follow up the exercise with an interview with the candidate to understand the logic and motivation behind a decision. The results are assessed by qualified and trained assessors. He/She writes a report based on his/her analysis.

Leaderless Group Discussion Such group discussions are of two types—with and without assigned roles. They do not have a group leader or coordinator to guide the proceedings. The roles are from the work situation such as supervisor, peer, subordinate, etc. Participants are required to solve real life problems. Sometimes the members are asked to approach the problem as consultants to the organisation. At other times, the members of the group are assigned roles to approach a specific task. There are lot of emotions and tensions generated in the group.

Interview Simulation This is also called role play. Candidates are placed in customer contact situations where they have to play specific roles—e.g. lobby manager, receptionist, restaurant manager, etc. The ‘guest’ is primed in the role and behaviour to exhibit during the interaction. Such roles bring out interpersonal skills, behavioural flexibility, listening skills, etc. This method can be used for various scenarios such as boss-subordinate relationship, project team member, inter-group interaction, etc. each with separate criteria for evaluation based on what is desirable in the situation profile.

Analysis Exercises This is used for management positions. In this method, complex situations and information is analysed ending with different alternatives. This can be conducted by giving a case study of a real life situation. The candidates read the case followed by group discussion. The main stress of assessment is on analysis and interpretation of written material. There is some element of stress and tension during the group discussion. Participants communicate their findings to the assessor(s) at individual interviews.

Management Game Management games are fun simulation exercises depicting real life situations and company background. It requires working in teams to attain certain objectives. The games are designed to create chaos to ascertain individual responses to pressure situations and how they are able to work in a team. Some games are designed to include participants from other organisations, so that their experience and company background does not matter in the proceedings.

Criteria-based Interviews These interviews are designed to assess behaviour in various situations. The assessor takes the candidate’s qualifications, experience, and background in designing the behavioural questions. The interviewer puts questions to the participant to elicit information against certain behavioural criteria. Such questions can be

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theoretical and expect theoretical answers. These questions are not like what are asked at job interviews such as “What would you do if ...” Instead the questions would be “How would you....” Questions will be open, encouraging the participant to give expanded explanations rather than closed “Yes” or “No” answers.

Dimensions of Assessment The job related dimensions that are possible from an assessment centre are: l l l l l l l l l l l l l l

Adaptability Behavioural Flexibility Decisiveness Development of Subordinates Independence Interpersonal Stress Leadership Oral Communication Skills Organisational Sensitivity Planning and Organisation Sensitivity Tenacity Tolerance for Stress Written Communication Skills

l l l l l l l l l l l l l

Analysis Creativity Delegation Impact Initiative Judgement Management Control Oral Presentation Skills Persuasive Sales Ability Risk-taking Ability Technical Translation Time Stress Work Standards

The main thrust of assessment centres is to evaluate potential for the purpose of development. While evaluation of knowledge and skills is fairly simple, potential requires a wider range of assessments. Potential goes beyond what exists presently and looks at the additional skills and competencies that a person is likely to develop and evolve in future. In other words, it evaluates the growth potential of individuals to fill other positions. So, the emphasis is not the past or present, but the future. The assessment centre method does not replace other psychometric and knowledge tests and interviews for selection and career advancement. It only supplements other assessment tools; in a manner, it rounds off the profile of a person. The assessment centre method is based on the following assumptions: l l

l l l

That every individual can develop his or her capabilities further. That development possibilities can be defined even though there is no opportunity or evidence of it in the present. That the organisation continually requires people who can perform various kinds of jobs. That the organisation has an active career planning scheme. That the organisation has a strong training and development capability.

Creating an Assessment Centre It is quite possible that an HRD manager is presented with the challenge of creating an in-house assessment centre. This is not such a daunting task as it follows logical steps, each within the capability of the manager. The following diagram (Figure 10.1) illustrates the various steps in establishing an assessment centre:

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Formulate Objectives

Analyse Jobs and Situations

Identify Criteria for Success

Select Exercise and Design Programme

Select Candidates

Select and Train Assessors

Write Script and Run Assessment Centre

Prepare the Report

FIGURE 10.1 | Steps for Establishing Assessment Centre Let us examine each step:

Formulate Objectives The HRD manager must first determine the purpose of the assessment centre and how it is going to benefit the organisation. The assessment centre method is not an end in itself, but a means to an end. The uses have been discussed earlier in this section. The main purpose is to evaluate potential for a specific purpose, e.g. job suitability, career plans, etc.

Analyse Job and Situations The first is to understand the nature of the job thoroughly. The job analysis and job description are starting points. More important than that is the translation of a job description to the actual scenario. The job description may not bring out individual tasks that comprise a job responsibility. More important is the set of behaviours required to perform the job. The job is further exposed to an array of situations. The hospitality industry experiences new situations everyday. This is because each guest is different. Each situation requires unique responses to succeed. Then, there is the next higher job. The HRD manager wants to see the components of that job and the scenarios that surround that job and what knowledge, skills, and competencies are required to fill that job. Also, he identifies the set of behaviours required in that position.

Identify Criteria for Success Criteria are accurate descriptions of the expectations of an organisation in terms of the individual’s behaviour. However, there is a difference between basic job requirements and those requirements that will make the job

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a success. The assessment centre method looks at the latter. It sees the potential for a person to succeed in the job by identifying those criteria that lead to successful behaviour.

Select Exercises and Design Programme The exercises chosen must simulate elements of the job. It must be close to actual practice, recreating the complexities and level of difficulty. In other words, the exercises must elicit job-related behaviour.

Selecting and Training the Assessors Assessors selected are normally those managers who work two levels above the position. Immediate supervisors are not recommended as they pose a threat to the candidate. The assessors must be thoroughly trained. Normally, there is an assessor for every two candidates. External consultants and psychologists are also hired for senior positions or when there are not enough assessors internally who are capable or can spare time from work. However, the HRD manager and his team play a vital and active role in assessment centres. Training of assessors takes three to five days. They take part in the exercises to experience and get the feel of the exercises. They must understand the purpose of each exercise and their strengths and limitations. The training also includes observing behaviour, evaluating it in relation to criteria, writing reports, and arriving at final recommendations. The assessor must be familiar with interview techniques and evaluating role plays. Finally, the assessors must be trained inputting their evaluations into a report.

Selecting Candidates There are external candidates and internal ones. Both have different approaches. External candidates seeking employment have to be evaluated for their suitability for a job. Internal candidates are those who are identified for promotion. Obviously, such candidates have displayed consistent above average performance and are in the career plan for the higher position.

Writing a Script The assessment script is actually the schedule in which each exercise, interview, and feedback discussion is timed and programmed. Since it involves a number of people on a given day, participants have to be scheduled into groups as well as programmed for individual interviews and feedback sessions after the exercises. There may be many groups that have to be programmed for separate tests simultaneously, so that all go through the selected tests at the end of the day. Assessments can extend over two to three days depending on the number of people.

Report Writing The report is written after candidates are explained the criteria adopted for evaluating them and the findings of the exercises. Though each has an in-depth feedback session, they also get a final chance at closing to express their feelings about the programme. The report is written after each assessor has given his evaluation. There is an evaluation discussion where observations are aired and perceptions clarified. The assessment is done for each individual. There are no comparisons between candidates. Behaviour is evaluated against definite criteria pre-determined in all the exercises. There is no average scoring or consensus by voting. The report lists the candidate’s strengths and weaknesses in simple language. The evaluation is not on impressions, but demonstrated behaviour. The assessor may define behaviour that can be easily developed.

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The modern organisation, as we have learnt by now, has a leaner workforce which will be able to multi-task various functions including some management skills, information processing, diagnosis, and customer service in addition to functional tasks.

2. CREATING A LEARNING ORGANISATION A Learning Organisation is one where learning is a continuous process. It may be argued that most traditional organisations have a training and development department, and therefore, should be considered to be learning organisations. True that training and development (T&D) is a learning process, but it is programmed and designed to meet some present and future performance objective, of the organisation. In other words, it is the organisation that drives the T&D initiative. Employees get lulled into believing that their future development is in the hands of the organisation, which know best. The Learning Organisation reverses the trend. The onus of learning is on the employee who will take initiatives to fill the gaps in his/her performance. He/She will also keep updating on new developments for application at the workplace. The organisation now creates the conditions for continuous self-learning. Why do learning organisations receive prominence these days? Earlier, the organisations adopted the ‘cradle-to-grave’ policy in which employees once recruited had life long employment. Organisations met all their needs and even decided on the employee’s career path within the organisation. The organisation chose those T&D inputs that served the self-professed career path and performance objectives. Employees trusted the organisation and depended on them extensively for their developmental inputs and their career.

New Perspectives in a Global Age The global age changed that thinking. 1. The information age has created knowledge workers. Knowledge workers are those who have invested considerable time and money in acquiring knowledge and skills (often of a specialised nature) to the extent of mastery. They become experts who are self-driven, accountable, and result oriented. They bring knowledge-power to various functions and may be considered the expert consultants on the subject. For example, a wine butler can be an expert on wines; a concierge in customer service; an events planner on functions; a cook on a special cuisine; an IT professional, a hospitality software developer; or a facility planner. 2. The employment opportunities have increased globally for knowledge workers who do not place their lifelong career in the hands of one organisation. Employees know that they have to invest in their own learning to attain mastery and enhance their own employability. Organisations are also aware of the mobility of knowledge workers and are wary of long-term investments in people, lest they leave. The T&D inputs they invest in are meant to improve immediate performance. 3. Knowledge workers expect facilities within an organisation to update their knowledge and skills. They are more likely to join organisations that provide that facility than those that do not. Organisations with a learning culture are able to attract and retain good talent because they are assured of continuous growth. 4. Knowledge workers are increasingly seeking employment in global markets where they know that employability is based on their capabilities. Such employment is contractual; renewable each year. Foreign companies employ on project basis in a short to mid-term employment span. They are

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unwilling to spend huge sums in T&D on expatriate staff that are just transitory. They would rather spend on their nationals from whom they can expect long term employment. The best they can offer are self-learning facilities. 5. Innovation and continuous improvement are valued performance criteria of organisations to maintain a competitive edge. For this to happen, a learning organisation encourages employees to update their knowledge and skills continuously and bring these to their workplace.

Learning Facilitators The HRD manager who wishes to create a learning organisation must introduce the following:

1. A Learning Centre The learning centre may be a purpose-built facility or just a small room in the complex that provides the resources for learning. The fact that it is there is a start to create the tools of learning. The learning centre has the following facilities:

A Library It must be understood that it is not the quantity of books that matters, but the quality of books. The books must be updated each year with the latest practices. HRD managers will typically review the bestseller lists (non-fiction) in various countries to determine what is being read. The HRD Manager must have a close communication with the local bookseller to update him/her with the latest releases and books available. The HRD manager will take considerable time to review these books. He will forward books of other disciplines to a senior person or knowledge worker in that function to review and recommend its suitability for the library. A learning organisation will have other employees actively recommending books for the organisation. The HRD manager must review such recommendations using other experts in the organisation to endorse them. Issue of books is done on trust. A computer or register is placed in the library. Employees fill their names, date of withdrawal, and the book title into it and return it within a reasonable time period (usually 2 weeks). Trust is important in the borrowing of books. Learning Centres with larger libraries may have a part-time librarian, or give the responsibility to the coordinator of the library. An Audio-Visual Library This is important, especially for non-specialists who learn better through audio-visual means than written material. Typically, the library will have a collection of videos, CDs, slides, PowerPoint presentations of past T&D programmes, audio-tapes, and self-learning training modules. This is an expensive investment by the organisation. The room will have cubicles each with a screen monitor, player, and headphones. Today, computers are fitted with media-players. An employee may use this facility at any time during the day (or night) by selecting the concerned training film and have a private screening. The employee can make notes and can learn at his/her own pace, rewinding and playing difficult portions at will. The library has another purpose. Many audio-visuals are used in T&D programmes. These are shown only once in a programme. A participant of the programme can replay the audio-visual, off-programme hours to gain better understanding, and tally it with his/her notes taken during the programme. Distance Education Cells This is a facility for employees to educate themselves through distance learning while working. It is the biggest benefit an organisation can give to employees in the modern age. Typically, employees enrol into various distance education programmes to upgrade their skills. With modern technology, employees can receive lesson plans, study them, and review their progress on the net. After enrolling, employees

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get study kit from the distance education source. They can plan their learning at their pace. Some distance education sources allot specific times when tutors are on line to field any questions and doubts posed by the student. The organisation provides a broadband facility to make the internet quicker. Advancement on this facility is video-learning where trainers give lectures online. Such a facility prevents the employee from taking sabbatical for continuing education. Employees in the hospitality industry can use off-shift hours for self-learning.

Reading Room A reading room is a quiet place for employees to read their books and periodicals. The reading room may be part of the library or a separate dedicated place. The main discipline maintained is silence. The HRD manager will keep a collection of periodicals relevant to update knowledge. The Harvard Business Review and the Cornell Quarterly are excellent examples of the type of quality periodicals maintained. They give the latest research and knowledge. The HRD Manager also keeps cuttings of important articles that are published in daily newspapers and other sources for the benefit of employees. Classrooms These are dedicated facilities for learning in groups to a maximum of 20 participants. The classrooms are equipped with the latest audio-visual technology, proper lighting, sound systems, ambient environment, etc. The classrooms are where the organisation’s T&D sessions are held. Counselling Room(s) These are small rooms with round tables to seat four. The learning organisation provides counselling to employees on matters concerning their performance, career plans, and mentoring meetings.

2. Learning Circles These are innovative processes to spread the ‘gospel’ of learning. Typically, there are several ways in which it operates: (a) Employees with the same learning need form an informal group. Members in the group exchange what they have learnt via the intranet (inter-office net) or meet periodically to share their learning in face-to-face group meetings. It gives an employee the advantage of harnessing the learning capabilities of others. (b) The informal groups set tasks of learning. Each member thoroughly learns a chapter of the whole text and presents it to the group. Group members can ask questions to clarify their doubts. The presenter acts as the ‘expert’ on that topic. There is sufficient informal competition and pride to give authentic and learned presentations. (c) Any employee posts a new topic that has been studied and researched on the intranet for all employees to read. (d) The organisation arranges a monthly presentation on a topic in the classroom by an employee most competent to deliver it. The speakers are usually volunteers in the organisation. Initially to kickstart the process, the HRD manager requests senior managers to prepare a topic for presentation. The quality of presentation may differ based on the capability of the individual to present. The presenter has to field questions after the presentation. His/her ability to do so capably is based on the level of his/her preparation and authority on the subject. Attendance to these lectures is voluntary and suitable for those who would benefit from the topic. Organisations may build a system where each employee gives one presentation in a year and perhaps attends to at least five presentations in the year for the purpose of encouraging a learning organisation initially.

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3. Coaching This is a vital skill that all managers and supervisors must have. Coaching is one-to-one instruction on the job, mostly to impart skills. The learning organisation likes all managers and supervisors to demonstrate their interest in learning by coaching on the job. Employees view them as facilitators of learning rather than police persons. The organisation takes the responsibility to impart coaching skills to its management and supervisory staff and expect them to use this skill liberally. Very often, learning organisations build in a mandatory requirement of a minimum number of coaching hours that is evaluated at the performance interview. Each manager/supervisor has to log the name of the employee he/she has coached, the time spent, date, and the nature of coaching.

4. Performance Appraisal A learning organisation takes stock of the new learning that has taken place. Since innovation and continuous improvement is a vital cutting edge of modern organisations, the knowledge wealth of the organisation becomes an asset, and in fact, a capital asset, since competencies can be converted into currency. The HRD manager must devise performance indicators on how successful the learning organisation has been. It can measure the increase in skills inventory of the organisation; it can relate new innovations to the new skills acquired; it can measure the employee morale and motivation because of the learning facility; it can measure the growth of employees (not in terms of advancement), but new knowledge acquired. Learning organisations must bring in accountability of learning and progress in individual performance appraisals. Assessors actually list the new knowledge and skills gained. They will also assess how this new knowledge has translated into performance and the generation of new ideas.

5. Reward and Recognition To foster a learning attitude, the organisation must introduce reward and recognition for outstanding initiatives in learning. Learning behaviour must get public recognition, and new innovations given due recognition, with substantial monetary rewards. A new idea may have increased revenue perpetually or reduced cost.

3. DEVELOPING A HIGH-PERFORMANCE ORGANISATION HRD Managers are asked in modern organisations to develop initiatives towards a high-performance organisation. High-performing organisations are those whose human systems perform at levels of excellence far beyond those of comparable systems in the market. The first mention of such a phenomenon was by an American academic, Peter Vaill, in 1982. According to him, organisations that qualify for a high-performance status are those that: l l l l l l l l

Perform excellently against a known external standard. Perform beyond what is assumed to be their potential best. Perform excellently in relation to what they did before. Are judged by informed observers to be substantially better than comparable groups. Are achieving levels of performance with fewer resources than assumed necessary. Are seen as exemplars, as a source of ideas and inspiration. Are seen to achieve the ideals of the culture. Are initiators of new processes.

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Vaill further argued that high-performing organisations tend to have a number of common characteristics: 1. They have clear shortand long-term purposes. 2. Members show a high level of energy, motivation, and commitment in pursuit of those objectives. 3. Tasks are achieved through integrated teamwork. 4. The leadership is predictive and reliable and adopt new ideas relevant to the task quickly, and cross-department ideas with caution. 5. Employees are devoted to maintaining the organisation’s image. 6. Freedom to employees to contribute. The key to high performance organisations is flexibility, i.e. the capacity to respond quickly and effectively to highly uncertain environment. This is achieved by employees having a powerful shared vision in generating high levels of commitment. Another major breakthrough in high-performing organisations came again in 1982 by Peters and Waterman in their book, In Search of Excellence. It had a profound impact upon management thinking and upon behavioural science in organisations. The book describes the business practices of a number of American companies. They identified eight attributes common to most of these excellent companies.

Eight Attributes of Excellent Companies 1. A Bias for Action: The tendency to get on with it rather than get bogged down with extensive analysis and bureaucratic hiccups. 2. Close to the Customer: The high-performing companies were customer-centric and had the strong desire to please them. 3. Autonomy and Entrepreneurship: The companies broke their activities into small units, each with the autonomy to show initiative. Innovation was highly valued. 4. Productivity through People: Employees were considered as key resources of the organisation and were involved in the all activities. The activities were designed to reinforce the importance of their contributions to the organisation with just rewards. 5. Hands-on, Value-Driven: Senior executives promote a strong corporate culture and obtain feedback by keeping in close touch with core business activities. 6. Stick to the Knitting: Successful companies stay close to the business they know best and avoid the temptation to become conglomerates. 7. Simple Form, Lean Staff: The high-performing companies maintain a simple organisation structure, avoiding deep hierarchies and the complexities of matrix organisations, and employ relatively few senior head office staff. 8. Simultaneous Loose-Tight Properties: Companies had core company values which were not negotiable within which employees were given considerable freedom. Even errors were tolerated.

In 1985, Tom Peters teamed up with Austin in a follow-up book called A Passion for Excellence. It was a book to explain how to put the first book—In Search of Excellence—into practice. Though the eight attributes were still valid, emphasis was now placed on four factors considered to be the most important: (a) customers; (b) innovation; (c) attention to employees; and (d) leadership. Tom Peter’s third book, Thriving on Chaos, brought out in 1988 departed even further from the first book. He emphasised on the need for constant, rapid change to survive in a changing world. Having gained some insight into high performing organisations, the HRD manager is now confronted with how to convert it into action. Here are some useful steps to take in the pursuit of high-performance:

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1. The top management must have a clear vision as to where it sees itself in the marketplace. The vision obviously is to be the best. It must place the customer as the main reason to be in business, as also emphasise the importance of its people in making it happen. 2. The management must translate the vision into values of the organisation that promote excellence. Old values need to be replaced by new ones. The values determine the culture of the organisation. Some important values can be that all actions must be customer focussed; that innovation and continuous improvement is imperative to organisation success; giving more autonomy to the employees; etc. 3. Benchmark all activities of performance. Set standards that are better than the competition’s. Train employees to those standards. 4. The vision and values must be communicated to all employees and it should be ensured that they understand them. It is important that employees share the vision and demonstrate the values in their day-to-day actions. Reward behaviour that supports commitment to the vision and values. Open communication is supported by physical demonstrations of it, e.g. open seating offices, managerial offices with glass partitions with an open door policy—meaning that employees can access managers at any time without prior appointment. 5. The organisation must promulgate policies that support the vision and values. Important policies relate to hiring, compensations, rewards, training, and career planning. 6. The organisation should look at its structure and make decision-making less cumbersome. There should be fewer levels so that tactical decisions are made at the customer contact level. The support staff must be on the spot for easy reference and not in cloistered corporate offices. The management style should be supportive in a manner that encourages team autonomy, problem-solving, and decision-making skills to the point that management interference is not needed on a daily basis. The ability to stand back and let the frontline utilise is a managerial attitude of the future. Manager’s job would be to promote business development, optimise resources, forecast business and make functional strategies, improve operational logistics, coach individuals and teams, evaluating and implementing new ideas. Managers must add value to performance teams than act as inspectors and police persons. 7. Organisation and work design must provide enriched jobs with holistic view of operations. 8. Recruit the best talents and find ways to reward and recognise them. Give them a career plan. 9. Empower the frontline workers with greater autonomy. Enrich their jobs to have greater control at their workplace. They must be accountable for their actions and given just rewards for their performance. Employees must have a sense of ownership of what they do. 10. Develop highly skilled, flexible, coordinated, and committed work teams. High-performance teams are self-managing, self-organised, and self regulating. They have total responsibility with accountability. Members must be multi-skilled within the team and must be able to share skills, knowledge, experience, and problems. Evaluation should be 360 degrees. 11. Have a learning organisation that encourages new knowledge, skills, and competencies. Training and Development must now respond to individual needs. Believe that personal growth and organisational growth can go hand-in-hand. 12. Invest in technology that will improve efficiency and speed up processes and information. 13. Introduce innovative compensation practices that will reward performance well. It should preferably be a combination of skills-based payment with merit awards. 14. Develop a transparent performance appraisal system that rewards group and individual performance. 15. Develop recognition schemes that will demonstrate the upholding of organisational values. Some recognition must be on the spot.

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16. Develop a strong partnership between management and unions. As a matter of fact, knowledge workers should not need unions. However, the management and union relationship should be a win-win one. 17. Introduce career planning and individual growth (as against advancement). An important aspect of management is managing the transition from traditional ways of working to the high-performance work culture. Sometimes, management may create a test group first to examine all the problems in the process of transition. The test group becomes the ideal state that the organisation wishes to be in future. Once the transition has taken place with the test group, the process of change is introduced to the rest of the organisation. The test group could be under a project team of managers whose specific task is to see that the test group attains high-performance goals. The project team must be able to achieve the following in the test group: l l l l l l l l l l

The ability of the team to respond to change quickly Improvement in communications within the group Ownership of actions Identification with the group vision and values Better business understanding and priority setting Flexibility through multi-skilling Problem-solving and decision-making ability Self-management in teams Planning skills Customer focus

4. KNOWLEDGE MANAGEMENT Knowledge management has become one of the most significant developments in organisation theory and practice brought on by the information age. The knowledge economy is based on three pillars: 1. Knowledge has become what we buy, sell, and do 2. Knowledge is currency in what is known as Intellectual Capital 3. Knowledge requires more vocabularies, management techniques, and technologies to manage it. Knowledge management has been defined by Todd R. Groff (2003) as “the tools, techniques, and strategies to retain, analyse, organise, improve, and share business expertise.” It capitalises on an infinite resource—the knowledge of the people. Unlike other resources, knowledge does not deplete when it is shared. In fact, the sharing of knowledge almost invariably results in increased knowledge of those who share it. Knowledge, therefore, becomes the intellectual capital of the organisation. Intellectual capital comes in two forms (Stewart, 2001) ‘hard assets’ and ‘soft assets’. Hard assets are patents, copyrights, and software and data bases, while soft assets are employee focussed in terms of skills, capabilities, expertise, culture, and loyalty. While hard assets are well taken care of, soft assets are not harnessed to advantage. As a matter of fact, the moment we terminate an employee or the employee has left by his/her own volition, the organisation loses knowledge, much touted as ‘brain drain.’ Stewart points out that worldwide we produce 700 to 2400 tetra bytes of information annually. One tetra byte is equivalent to a thousand billion bytes. Knowledge was USA’s most valuable asset in 1999

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accounting for $37 billion in licensing fees and royalties. Hospitality franchised operations are a towering example of knowledge export. Knowledge management owes its inspiration to the work of the philosophers Michael Polyani and the Japanese organisation guru Ikijuro Nonaka. Both theorists argued that knowledge has two forms—explicit and tacit. Explicit knowledge is found in books, manuals, reports, documentation, files, and other accessible sources. Such knowledge available to an organisation can be replicated (with the hope it does not leak to competition). Tacit knowledge is found in employee heads. It is difficult to access and use. Sometimes, organisations do not even know that it exists. Upon an employee’s exit that knowledge is lost. Grant (1997) argues that HRD can improve an organisation’s competitiveness by harnessing the knowledge base of skills and competencies of its employees and converting it into currency. Therefore, if a chef has skills in a unique cuisine, those skills must be recorded and used to convert has into revenue. Welcomgroup Maurya Sheraton did just that when they recognised and tapped the skills of two particular chefs who produced the North West Frontier Food and Dum Pukt cuisine converting them into branded restaurants, well before this concept was recognised. At another level, a Financial Controller of the chain was an accomplished magician. They used those personal skills in promoting their New Year gala evenings! Therefore, if an organisation wishes to introduce knowledge management it should: l l l l l l l

Accept knowledge as a vital resource. Inventorise it formally. Distinguish it clearly as explicit and tacit knowledge. Recognise that tacit knowledge rests inside individuals and is learnt from their unique experiences. Tap this tacit knowledge and make it the intellectual capital of the organisation. Set aside budgets to research and develop it further. Use it as key business products and services to gain the competitive edge.

To propagate it, organisations must understand the following:

Data, Information, and Knowledge These are three different concepts: Data is hard factual information often found in numerical terms. It tells how, when, and how often something happened, how much it cost, and so on. It does not say why it happened. Information comes in the form of a message and it is the receiver rather than the sender who determines its value. Information comes through voice, fax, letter, etc. that has meaning and shape. In fact, data can be converted into information by adding meaning by: l l l l l

Contextualising it by determining the purpose the data was generated for. Categorising it into predetermined components. Calculating it through statistical and mathematical methods. Correcting it to remove errors. Condense it into digestible information such as summaries, tabulations and graphs.

Knowledge is the learning of this information for a future use.

Practice Amrit Tiwana (1999) points out that technological companies which have prospered are those who have not invented technology, but those who have applied it. Microsoft is a towering example. Microsoft applies

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knowledge rather than creating it. Competitive advantage comes out of applications of information and knowledge. Organisations must first know what knowledge they possess; think of how to use it for competitive advantage. Often organisations do not know what they know. If they do know, they may not know how to convert it into an asset. A caution is required here. Some knowledge can be outdated. Many organisations may be working with obsolete knowledge and skills and are unaware of it. They can only know this if they inventorise this knowledge and audit it with the best practice available. This process requires someone who is curious and hungry for knowledge. This person should be HRD who drives the knowledge management process. When organisations replace someone with fresh blood, they tend to mould the new person in the old ways of the organisation. Instead, progressive organisations would first recognise the new knowledge coming into the organisation and give it opportunities to be put to use. The future organisations will look for youth and constant replacement to bring in the latest knowledge into their ranks. This new knowledge must be used to transform, rather than decay with a lack of use.

Expertise An expert is “a professional who sets the standards for a job. He/She is someone who sets a clear path for others to follow” says James Shanteau, psychology professor of Kansas State University. The qualities of an expert are: 1. Knowledge: An expert must develop a knowledge base and be educated and experienced in his or her field. 2. Ability to Apply Knowledge: Experts must be able to use their knowledge and apply it appropriately to whatever situation they may encounter. 3. Make the right choices: Once the expert has figured out the right knowledge to apply, he/she must be able to make the right choices. An expert says, “Here is the problem and this is the way we can approach it.” 4. Never Quit: Experts keep thinking and re-thinking. Experts always evaluate how a decision can be made better. They never stop probing their own skills and developing them further. An expert says, “There is so much more to know. I know so little.”

Developing Teams of Experts The future organisation will be run by experts in their respective fields. Most probably, they will work with other experts in the team. This can be a challenge because each is a master of his profession. HRD will have to do the following in developing them: 1. Communication: Develop a clear communication between team members who have a thorough understanding of each others’ expertise and respect it. 2. Mental models: Models are the way people conceptualise the world and the jobs they are doing. Experts on a team must also work with mental models to conceptualise the team’s expected output. 3. Understanding: Members must have an understanding of each other, their strengths and weaknesses, working style, and space required to perform. 4. Cooperation: Watching out for each other is a key aspect of teamwork. Team members must be able to recognise when another is in need of help and be willing to offer help. Peter Drucker (1998) said that knowledge management will be the future of organisations as it de-layers their structures to half of what exists today. The number of managers will be cut by two-thirds. Future

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organisations will resemble hospitals, universities, and orchestras composed largely of specialists who direct and discipline their own performance through organised feedback from colleagues, customers, and the headquarters. In the 20th century, information was used to control people. Knowledge was held by top management where strategies and decisions were made. Specialist knowledge workers will resist primitive command and control and will manage their own affairs.

5. JOB EVALUATION Job Evaluation is a process of assessing job worth. The rapid expansion and growth of many organisations in the recent past has necessitated a scrutiny and review of grade structures that influence the salary administration system to ensure that these were still appropriate to business needs in a changing and highly competitive business environment. In particular, many organisations have found it necessary to examine whether the grades still adequately reflected the relative size of the various jobs. Certain companies have modified their activities or re-organised their jobs significantly, and consequently, some jobs have been enriched by additional responsibilities, while some others have been enlarged by the increase in the volume of work. Some other jobs have become smaller. From time to time, it is necessary to measure the extent of such changes and wherever necessary, realign the jobs to reflect their current worth. It is important that line managers are advised on the implications of taking the decision to change the structure and job contents. After the structure is approved, the line manager must submit them for job analysis and job evaluation, so as to realign the job worth. A common method for salary grade review is job evaluation. Job Evaluation is a quantitative measurement technique to ascertain the worth of a job. The Hay Guide Chart and Profile Method, developed and refined over the past 40 years, is recognised as one of the most versatile, systematic, and technically sound methods of evaluation today, although there are many alternatives. The Hay system has the advantage of providing international comparisons on the Hay Point System.

Job Evaluation Objectives A typical job evaluation system is expected to accomplish the following objectives: 1. Establish a basis for the continuing review of internal relationships between jobs, dependent on their relative contribution. 2. Utilise a point score to determine the grade of the job that influences the remuneration for the job. 3. Enhance organisational effectiveness by ensuring that each manager and subordinate agrees on job content, job objectives, and scope of authority. The resulting job description thus clarifies the scope, content, and roles of various jobs in the organisation. 4. Develop a basis for making external comparison of remuneration practice with other companies. 5. Provide a basis for organisational analysis when necessary.

Job Evaluation Process Step 1 A need for job evaluation arises when two things happen: 1. Creation of a New Job New jobs are created to respond to new activities such as new products and services, new markets, new roles, new strategies, etc. A new job definitely requires a job evaluation to fit it into the grade structure.

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2. Re-organisation of an Existing Job This is an existing job that has been re-organised because of changes in work methods, job design, introduction of technology, new focus, new authority, etc. Such changes must also be sent for job evaluation to realistically position the job in the grade structure.

Step 2 Developing a Job Description (see “Job Descriptions and Job Specifications” in Chapter 3 for details). A job evaluation responds to valid job description developed after job analysis. The HR manager is responsible for this activity. While developing the job description for the purpose of job evaluation, it is important to define the following: 1. Job Purpose This requires an accurate and concise statement of why the job exists. In other words, it should answer the question, “What is the job’s primary purpose for being included in the organisation?” The reason for such a succinct statement at the very outset is that the evaluation panel can immediately understand the job’s overall role. The job evaluator must be clear as to what objectives of the organisation this role would accomplish. Typical purpose statements will be: “To achieve or exceed given sales targets for an assigned range of products and services.” “To complete registration formalities as per procedure and standards to customer satisfaction.” 2. Job Dimensions Job dimension is the range of responsibility preferably expressed in quantitative terms. It identifies the area of the organisation that it most clearly affects. Some jobs will have budgetary responsibilities and/or staff to control. For some jobs, there may be no specific figure on which there is even an indirect impact. All figures are mentioned in annual terms. In analysing dimensions, it is useful to outline the list of products or services handled or territories or markets covered to supplement the quantitative dimensions with other features which give an indication of the size of the job. 3. Organisation Chart The job description gives a visual organisation chart that indicates where the position fits in a section of a department, department, or organisation. The extent to which the organisation chart is drawn may vary from job to job, but in all cases it should be able to pinpoint where the job fits into the organisation. The position box itself should be highlighted to facilitate such pinpointing. An example is given below (see Figure 10.2). 4. Accountability This is where the ‘buck stops’. This aspect gives those areas where the job holder is obliged to explain actions or decisions. The end result lies squarely on the job holder. Clear accountability statements are: l l l l

Realistic Explicit Suggestive methods of measurement Properly related to accountabilities above

l l l

Challenging Guides to action Reflective of organisational constraints

Typical Accountability Statements “Develop and recommend (Action verbs) budgets (function) to meet planned growth requirements (end result).” “Manage, motivate, and train (Action verbs) a team (Function) to meet goals set (end result).” “Meet or exceed (action verbs) planned sales (function) by adapting marketing strategies to local market conditions (end result).”

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Front Office Manager

Assistant F.O. Manager

Shift Supervisor

Front Office Agent

Reservation Agent

Concierge

FIGURE 10.2 | Organisation Chart 5. Job Context Is the role of the job within the company and the external environment. It stipulates how the job fits into and serves the rest of the organisation. It also gives the environment of the job in terms of technology, market, geographical considerations, statutory requirements, historical background, customer focus, etc. 6. Relationships Describes here the internal and external contacts essential to the job. Internal refers to those contacts that are within the organisation, and external refers to those that are outside the organisation. Here, we mention the titles of job holders to describe the contacts. Sometimes, it is a complete department as in the case of a restaurant that coordinates with a kitchen. Such contacts can be: l The superior l Peers within the department l Colleagues in other departments l External persons and agencies (suppliers, government agency, customers, principals, etc.) Along with the contact is listed the nature of the relationship, type of contact (face-to-face, telephone, e-mail, etc.), and the purpose of the contact indicating whether it is to receive information, negotiate, solve problems, provide service, etc. While developing the job description, it is important that the job holder and the supervisor are involved fully and have the opportunity to comment on the factual content and emphasis given to the activities of the job. Once the final version is agreed, both should sign off before the job evaluation takes place. A skewed job description will certainly give a wrong value to the job and an unfair compensation package. The diagram (Figure 10.3) below gives the flow of activity:

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Job Specification

Job Analysis

Job Description

Job Evaluation

Grade Structure

Sign Off Job Holder

Supervisor

FIGURE 10.3 | Flow of Activity

Step 3 Prepare an Evaluation Rationale Form This is either originated by the line manager who forwards it through his/her chain of command, or by the HRD manager to his/her superior. A sample of the form is given below: Job Title: Job Holder: Present Grade of the position: Estimated grade of the job: 1. Outline the circumstances which have led to the need for a fresh evaluation (New Job, Job Enrichment, Job enlargement, Job Dilution, Re-organisation)

2. Outline the precise aspects of the job that have changed since last evaluated (for old jobs only)

3. Describe briefly the background and evolution of this job (list any grade changes this job has undergone in the past).

Date:

Department Head Signature

HR Manager Signature

FIGURE 10.4 | Evaluation Rationale Form

Step 4 Conduct a job evaluation interview with the job holder along with the superior, and in some cases, the department head. The effectiveness of the interview will have a significant impact on the job evaluation. Such an interview cannot be undertaken unless the organisation and the job holder are clear and concur with the job description.

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Before the Interview l

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The interviewer must confirm his/her understanding of the organisation, its dynamics, and some understanding of the jobs, functions, and processes. The interview must be in an office that has least distractions. Set up a definite appointment well in advance, so that the interviewees clear other responsibilities to give full attention to the job evaluation. Copies of the job description must be at hand, so that each member in the room is seeing the same document. The interview must keep away any preconceptions that could taint the job evaluation. The proceedings must be based on facts. Inform the parties to bring any factual documents that will support claims made.

The Job Evaluation Interview l

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Build an initial rapport with lighthearted conversation. Clarification of the organisation chart is a non-controversial topic to start with. Most employees are shy, nervous, and diffident. Confirm to the employee that the interview is about the job and not the person. Establish that all must concur in the rating. Discussions are permitted to arrive at that. Ask questions that are open-ended (what, how, why, where, which, who) Listen carefully, and if things are not clear ask for clarification. When asking questions, do so in an enquiring manner and not a challenging one. Do not show approval or disapproval, but curiosity and enquiry. Do not ask leading questions that may end in desired answers to suit prejudices. Summarise answers to be clear that what the employee is saying is perfectly understood. Be patient with complaints about the job because employees see the job evaluation interview as a dumping ground. Be non-committal. Be specific in the question. Do not dominate the discussion. Listen between the lines for information. Try to keep the discussion moving. Items which bog down the job evaluation process can be temporarily abandoned to be picked up later.

Closing the Interview Make sure that all aspects of the job evaluation are complete. Thank the participants and seek their support should you need to get back to them.

Step 5 Give point values to each aspect discussed in the job. The following example gives a flavour of how point values are presented. Job evaluation takes certain factors of a job and gives values. The factors chosen in this example are for a management position. These factors are: l l l

Accountability Corporate Authority to Act Professional Knowledge and Experience

l l l

Degree of Judgement Nature of Relationships Planning

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The above six factors are expressed in terms of various degrees, each of which is given a weighted score or Point Value. The hierarchical level is also taken into consideration in addition to the six points. The scores for each of the above factors are fed into a pre-programmed formula for determining the job grade. Each factor is further divided into criteria, each with a value.

Accountability This section considers the job responsibility for managing others and the scope of control exercised. The control may be at various levels: 1. No supervisory responsibility. 2. Section: Supervision of several people engaged in similar activities. 3. Unit: Management of a unit in business, operating, or functional component, with budgetary accountability. 4. Department: Management of a business, operating, or functional component where the activities are primarily related to a single function (i.e. product development, marketing, delivery, or infrastructure). 5. Division: Management of two or more business, operating, or functional components through subordinate managers, or management of a major area, or a corporate-wide function. 6. Group: Management of a major group or a fully integrated business component (i.e. integration of multiple functions, such as product development, marketing, delivery, and infrastructure) toward a common result.

Degree of Judgement This section addresses the complexity and degree of judgement required to solve the most important problems encountered in the job. Note that many of the problems faced have already been defined by senior management in the establishment. The problems may be 1. Clearly Defined: Problems are clearly defined. 2. Generally Defined: Problems are clearly identified, but must first be clarified in order to proceed. 3. Somewhat Defined: Problems are not well defined, but are recognisable. Further investigation is necessary to define causes before proceeding. 4. Vaguely Defined: Problems are vague, dealing primarily with symptoms that may not relate to the real problem. Extensive investigation may require inquiry in unrelated areas. 5. Undefined: Problems lack definition and issues bear little discernible relationship to real problems.

Authority to Act Each authority in the organisation is governed by the authority delegated to it by the organisation to accomplish its primary goals and to accept accountability for the results. 1. Work is guided by specific instructions and/or detailed procedures. Normally activities are closely monitored and require to follow simple procedures. 2. Work is guided by standard instructions, written procedures, and established methods, normally subject to managerial review of activities in progress.

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3. Work is defined by defined policies and guidelines and established practices, normally subject to review of completed assignments. 4. Work is guided by broad operating policies, guidelines, and approved plans, normally subject to managerial direction, progress review and evaluation of achievement objectives. 5. Work is guided by the approved strategic plans for the specific business or functional entity, normally subject to guidance and periodic review by CEO. 6. Work is guided by the owners/Board of Directors.

Nature of Relationships A critical aspect of any job is the need to work with the others to accomplish the job’s primary goals. Interaction may occur internally and externally at many different levels and for different purposes. Nonetheless, every job can be characterised in terms of primary purpose of relationships necessary to accomplish the job’s principal goals, which are: 1. 2. 3. 4. 5.

Provide and receive information required. Provide customer service or functional support of line activity. Provide professional advisory services. Gain cooperation and commitment, and/or sell to those with similar backgrounds. Gain cooperation and commitment, and/or sell to those with divergent backgrounds.

Knowledge and Experience All jobs have a set of professional knowledge requirements that contribute to successful job performance. Consider the knowledge area that is most critical for successful performance in the job. 1. Familiarity with basic concepts, policies, procedures, or practices. 2. General working knowledge of basic concepts, policies, procedures, or practices with a little experience. 3. Full working knowledge of the fundamental concepts, procedures, or practices with experience. 4. Specialised knowledge of relevant theory, concepts, or practices with a great deal of experience. 5. Comprehensive knowledge of relevant theory, concepts, or practices with a great deal of practice. 6. Mastery of a specialised field with broad experience, understanding, and contribution.

Planning What is the most common type of planning required? 1. Position Planning: To plan activities limited to the position itself; procedures, priorities, and results are planned and monitored by the manager. 2. Procedural Planning: To plan for and monitor assignments, methods, procedures, schedules, and results of planned activities within defined limits and requirements. 3. Operational Planning: To plan for and manage objectives, activities, priorities, and resources, provide definition and guidance for compliance with methods, standards, and procedures, and facilitate achievement of planned results.

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4. Tactical Planning: To plan for and manage the priorities of major objectives and resources, develop alternative courses of action, response to new or changing needs, and ensure the achievement of planned objectives and results. 5. Strategic Planning: To develop and manage on the basis of assessed opportunity and capability, and short-and long-term strategies and plans. To plan for and manage the achievement of growth, profitability, and performance targets in the organisation’s long-term business planning. 6. “Balance Sheet” Strategic: To formulate and direct the organisation’s long-term business direction and broad strategies. To plan for and direct the acquisition, investment, and deployment of organisational and financial resources to maximise business opportunity, growth, and profitability. Indicators as used by Hay are: l l l l l l l

Know-how—specialist and managerial Human Relations Skills Thinking Environment Thinking Challenge Freedom to Act Impact on end results Magnitude

The scoring is done on pre-designed scoring sheets developed after considerable research.

6. MENTORING What is Mentoring? Mentoring is an intense work relationship between senior and junior organisational members in which personal guidance and support are given beyond supervisory responsibility. It is a modern developmental programme gathering popularity. It is a formal relationship between a senior manager and a subordinate. The mentor is essentially not the immediate superior who rates the performance of the individual, but an objective third person in the organisation who is capable and has a proven career record. The mentor in other words, acts as a “friend, philosopher, and guide”. Mentoring is an ideal method in career and succession planning. It is also valuable to new entrants who need help to integrate into the organisation.

Features of Mentoring l l l l l l l l l

The mentor has no supervisory responsibility over the protégé. Mentors cannot directly reward the subordinate. It develops the leadership skills of the mentor. It increases the organisational effectiveness of both the mentor and protégé. The goal is to maximise performance. It involves personal and professional counselling. The mentor has a successful career background within the organisation. The mentoring programme extends over 18 months. Mentoring can be both formal and informal.

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l l

A mentoring relationship terminates after the formal mentoring period. Each mentoring session lasts from two to four hours each month.

Mentor’s Qualifications An organisation chooses a mentor to enhance the knowledge capital and performance of the organisation. The job is given only to successful individuals in the organisation who are proven performers. The process is meant to develop the mentor apart from being a key result area for senior management. The qualifications of a mentor are: l l l l l

Long service in the organisation A sincere desire to develop Has exemplary interpersonal skills Has integrity Is objective and does not possess his/her own political agendas

l l l l l

A track record of success Devotes time for mentoring Has good organisational skills Is service oriented Does not misuse the protégés time and relation

The 4 ‘Cs’ of a Mentor Nancy Chase, an expert on the subject, gave four ‘Cs’ as requirements of a good mentor. They are:

Commitment Commitment is the quality to see things through to the end. The mentor exhibits his/her commitment in the following manner: l l l l l l l

Gives his/her time for mentoring Works towards expected performance outcomes Negotiates the skills and knowledge areas to be developed Defines the methods and activities that will be used in the process Evaluates the protégé before and after the mentoring process to determine the progress made Defines the resources required to accomplish the tasks Negotiates the release of the protégé from the immediate superior for mentoring.

Courage Courage in this case is the responsibility of taking a protégé under one’s wing and be accountable for his/her success. The mentor must integrate the individual with the organisation, especially when dealing with some difficult senior management.

Curiosity The mentor goes through the journey of discovery with the protégé. He/She must also explore various creative avenues for learning.

Compassion The mentor has to put himself/herself in the protégé’s shoes to understand the difficulties in learning. It needs patience to deal with a protégé’s fears and weaknesses.

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Mentor’s Role Sponsorship A sponsor in this context is a person who introduces and supports a candidate for advancement. The mentor becomes a sponsor for the protégé. Sponsorship can be of two types—external and internal. The mentor may sponsor a protégé to external training programmes, memberships to professional organisations, or memberships to prominent committees and forums. Internally, the mentor can sponsor the protégé to internal development programmes, cross training opportunities and memberships to internal committees, e.g. quality circles, learning circles, etc. He/She recommends organisational funds where required in the interest of the individual and organisation.

Coaching Here, the mentor shares his/her knowledge and skills. The mentor will also share his experiences in dealing with various difficult situations. Coaching can also be in areas of personality development. For example, a protégé may be nervous to face people in a presentation. The mentor will help the protégé to overcome that fear.

Counselling The mentor counsels the protégé on matters of performance and how to attain full performance potential.

Political Advice The mentor helps the protégé to get through red tape within the organisation. He/She guides the protégé to deal with the politics in the organisation. He/She also helps the protégé to access senior members in the organisation when required.

Sounding Board The mentor is a good listener and must be trusted implicitly. The protégé must feel that he/she can discuss any aspect of his/her personal and professional problems that interfere with performance. For example, the protégé may find it difficult to deal with his/her boss. The mentor advises him/her on how to manage the boss while retaining the confidentially of the protégé’s problems.

Role Model The mentor is expected to show a high level of discipline and competence so that the protégé can model himself/herself to the mentor’s standards. An important aspect is the meeting of mentoring deadlines. The mentor must honour the mentoring meeting as important. It gives the protégé the confidence that the relationship matters and he/she is also expected to honour the commitments.

Mentor’s Tasks l l l

He/She has to read books/journals to see how he/she can contribute to the growth of protégé. Coordinate special assignments and tasks. Encourage protégé to join learning circles.

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Arrange cross-training and understudy. Sponsor participation to professional associations. Encourage professional certification. Career Counselling. To be successful in this he/she has to do the following: Determine the protégé’s interests Identify the level of the protégé’s knowledge, skills, and abilities Help the protégé develop career goals Target the areas of development Create a written development plan Determine success indicators Evaluate progress and take appropriate corrective actions. l l l l l l l

Protégé’s Commitment Just as the mentor is required to display commitment to the process, so is the protégé required to satisfy some expectations. These are: l l l l l l

Assuming the responsibility of one’s personal growth Openness to learn from others Being receptive to seek new responsibilities and challenges Desire and potential to succeed Self-discipline Have aspirations for higher responsibilities

Benefits of Mentoring l l l l l l l l

Newcomers socialise early into the organisation Protégés develop a higher job satisfaction Protégés reach potential earlier Protégés develop enhanced self-esteem and satisfaction Protégés have new perspectives at work Protégés exhibit positive performance Mentors groom successors to key positions Mentors have a chance to leave a legacy

Problems with Mentoring l l l l l l l l l

Protégés attract jealousy. Protégés come up with unexpected demands. There is sometimes a mismatch between the mentor and protégé. There is the chance of both not meeting commitments. It is an additional responsibility for the mentor. Both have to give time away from work. Mentor’s ego may come in the way of a benevolent relationship. Mentors get possessive of their protégé Separating from the relationship is a challenge to both.

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Phases of Mentoring There are five phases in the mentoring process. Let us look at each:

1. Initiation This is the stage when both develop a relationship. The meetings are often held outside the workplace at perhaps a coffee shop or a park. The mentor’s objective is to develop trust. This can be achieved by showing sincere interest in the protégé. This he/she does by being open in the first instance. Subjects discussed do not necessarily have to relate to work, but can be any subject of common interest, e.g. sports, theatre, music, movies, hobbies, etc. The mentor gauges the protégé’s personality, habits, traits that are useful and also those that are counter-productive. Perhaps they can make a programme to go out fishing or even come over for dinner. The mentor must, however, make a distinction between friendliness and familiarity. A certain distance is necessary to exert authority when required later. The protégé must reach a stage of accepting the mentor as a learned friend; at the same time maintaining respect and admiration for the mentor’s past successes. This is the time for the mentor to establish that the protégé is in ‘safe hands’. New employees in this phase are introduced to important people in the organisation and put through a process of formal induction and socialisation.

2. Cultivation At this stage, the mentor and protégé get to brass tacks of performance, potential, and future growth aspirations. Some protégés may need help in setting goals. The mentor confirms his/her commitment to learning. He/She shares the vision, culture, values, and plans of the organisation. The mentor helps the protégé discover interests and talents. He/She takes an inventory of capabilities and deficiencies. This gap analysis is done against the present job expectations, and later higher job responsibilities. They jointly make an action plan of the inputs for development. The methods employed could include coaching, sponsorship to in-house programmes, attendance in external programmes, counselling sessions, cross-training, understudy, self-learning through books, etc.

3. Transition In this stage, the protégé follows the development plan that was mutually set. The mentor must be professional. The mentor should also not overload the protégé with too many expectations and tasks. The process of transition to new learning requires self-discipline, dedication, and commitment on the part of both. Most of the times, these could be assignments and tasks given by the mentor. The mentor will try to give as many real tasks as possible. He/She follows up with the assignments at the next meeting. The mentor coordinates this transfer of learning. The mentor should be patient and not expect too much. He/She treats mistakes as learning experiences. He/She will share as much resources available to complete tasks. The mentor must also develop the character of the protégé while he/she acquires knowledge and skills. Evaluation of progress made is an integral part of this phase. Meetings are, therefore, vital on a periodic basis. Both must honour the agreed dates and times for the meetings. This phase takes the maximum time as it is the main development period.

4. Separation This is the stage when the mentor starts distancing himself/herself and letting the protégé work on his/her own. The mentor is trying to create a psychological independence to deal with issues. The mentor keeps

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his/her door open, but the onus of the meeting is on the protégé. The mentor would wish that meetings with the protégé at this stage do not take place, indicating the protégés independence. Sometimes this is painful for a protégé who has had the emotional security of a friend in the organisation who could bail him out whenever he faced a problem.

5. Termination It is the final phase of the relationship when both feel satisfied with the progress. At this stage, the mentor may reinforce what the protégé has learnt and that he/she need not worry in carrying on. The mentor informs the management giving them a report on the capabilities and potential of the protégé. The mentor then, may be assigned another protégé.

Mentor’s Training Programme Mentoring is a specialised field. All future managers are required to become mentors as the skill is valuable to an organisation with career and succession plans. Future organisations have to think of developing their knowledge capital as well as ensuring a steady supply of leadership. Mentoring is a valuable tool in achieving this. It also makes all managers responsible to develop the knowledge capital and encourages them with active participation in the process. An HRD manager has the responsibility to organise mentoring programmes for managers and supervisors. The key elements of such a programme are: l l l

l l l

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Explaining the phases of mentoring Clarifying expectations How to reinforce the organisation’s goals and values How to evaluate a protégé’s style Selecting congenial meeting places How to develop a proactive agenda of development How to separate the relationship Present facilities and tools available for support in the mentoring process.

l l l l l l l l l

Role definition of a mentor and protégé Instructions on how to coach Developing active listening skills How to develop an open relationship How to remain objective How to encourage and motivate Learning processes, especially of adults Rewards for mentors and protégés How to get the organisation’s support

Summary Best practices are those processes that have proven themselves in successful organisations. The HRD best practices selected for this book are new concepts that have risen from the revolution of the information age. They are focussed on the type of work and development of individual potential to meet the new organisational challenges. (Contd.)

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Summary (Contd.)

Assessment Centres, for instance, are meant to predict a person’s performance in a job as also his/her potential. The challenge for HRD managers is to get and position the right person in the right job. Assessment Centres use an array of evaluation techniques that look at all angles of a person’s personality and whether he can meet the challenges of the job. It is useful in selection processes of new hires, as also existing employees being considered for new roles. The new knowledge worker once hired needs opportunities for continuous education so as not to become obsolete. He/She is likely to join organisations that believe and implement continuous learning as a way of life. The philosophy of continuous learning increases the knowledge capital of an organisation. This asset can be converted into competitive advantage and opportunities for profit. Considerable attention these days has been given to the concept of excellence. Excellence brings customer loyalty and promotes the organisation’s reputation in the market. Researchers have found that excellence is provided by high performance organisations. Such organisations give their employees sufficient autonomy to shape their impact. The information age is called so because of the profusion of information generated by organisations. Often, the organisation is not even aware of the information they possess. Successful organisations are able to harness this knowledge and use it effectively for strategy and decision-making. This ability is called knowledge management which examines tangible information that is recorded and written, and intangible information that lies in the heads of its employees. Job evaluation has never had a more important role than today. As jobs change complexion frequently, their worth have to be evaluated constantly in order to position the job in the organisation and fix the right compensation to attract and retain talent. Then again, there are new jobs and expertise arising out of new ways of doing business, innovation, and new technology. These new jobs cannot be fit automatically into traditional salary grades. They have to be evaluated in terms of the contributions to a changing organisation.

Key Terms Assessment Centre Simulation Learning Organisation Learning Centre Coaching Intellectual Hard Assets Intellectual Soft Assets

A procedure that uses multiple assessment techniques for a variety of HR purposes A real-life experience in a non-real environment An organisation where learning is a continuous process A facility that provides the resource for learning One-to-one instruction on the job Patents, copyrights, software, and databases Skills, capabilities, expertise, culture, and loyalty (Contd.)

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Key Terms (Contd.)

Explicit Knowledge Tacit Knowledge Job Evaluation

Information in published and written material Knowledge that is understood or implied without being stated Process of assessing job worth

Review Quiz Short Notes 1. 2. 3. 4. 5. 6.

Explain three methods of evaluation used in an assessment centre. Explain the steps in creating an assessment centre. Explain how learning circles are organised. What are the characteristics of high-performance organisations? What are the actions required to create a high-performance organisation? Write brief notes on the following: (a) Explicit and Tacit knowledge (b) Hard and Soft assets of Intellectual capital (c) Data, Information, and Knowledge 7. Explain the job evaluation process.

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11 Employee Relations 1. OVERVIEW Unions are formal organisations that represent the employees’ interests to management on all important critical issues. Unions typically want to improve the financial status of employees and their working conditions. Unions emerged in the early part of the 20th century in England when people worked in factories and mills in England under inhuman conditions. The management at the time demanded 60 hour work weeks with no provision for safety, sickness, vacation, or retirement. People were viewed as extensions of machines and productivity was the only concern of the employer. People had no voice and suffered in emotional isolation. Unions came in as a wonderful ‘one voice’ of the labour force to improve their working conditions. Unions provided that collective force to counter management exploitation. Worker-management relations were strongly affected by the presence of unions. HR decisions such as compensation, promotion, discipline, and termination required union involvement. Unions interceded in management’s direct communication with workers and spoke on their behalf. With globalisation and the knowledge worker, managements have recognised the importance of employee involvement in many decisions. The concern for motivation and commitment has produced many innovative HRD processes. Employees today have a voice—individually and collectively. One wonders whether unions have a future in the service age with more enlightened HRD management practices. The traditional manufacturing sector may continue to have unions which have become vote banks in democracies and enjoy political patronage. The service industry, of which the hospitality industry is one, will have declining use of unions because of a more knowledge-based workforce. Managements are more willing now to offer organisational justice, job satisfaction, and perceptions of fair pay as their human resource strategy. While unions have been traditionally thought of as anti-management, the modern union is quite clued into new developments and has become a valuable partner in policy formulation. Managements are happy to negotiate with a ‘one-stop shop’. Nowadays, managements go to unions to solve some of their problems because of the influence and reach unions have with workers and society. Labour Relations is a very specialised subject. Managements need to have specialists who know the labour laws and the principles of collective bargaining. Labour relations come under the purview of HR.

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2. WHY DO WORKERS JOIN UNIONS? It is important for managers, especially HRD professionals, to understand why employees are willing to part with some of their salary to enrol in a union. There are three general reasons why workers join unions: 1. Dissatisfaction with the work environment which includes working conditions, compensation and nature of supervision. 2. A desire for more influence in changes that take place in the work environment. 3. The ability to give one influential voice through the union. Fredrick Herzberg in his groundbreaking study showed that working environment, salary and supervision were strong dissatisfiers (see “Individual Motivation” in Chapter 12). A ‘dissatisfier’ is one that creates unhappiness, while a ‘satisfier’ promotes motivation. Unions somehow fitted in well to remove these dissatisfiers, though they were neither qualified nor had the opportunity to provide satisfiers. Today, managements recognise this and give attention to better remuneration (enhanced with merit-pay), working environment, and enlightened supervision, where the supervisor is a facilitator and coach for better performance, rather than being a policeman. Fortunately, the service industry is generally able to give better working conditions than manufacturing units. For example, people who work in hospitality get duty-meals in a comfortable cafeteria; work in climate controlled environments; have clean and orderly surroundings; etc. The second reason why workers join unions is to have more influence in organisational change. Earlier, workers looked upon changes with suspicion. They felt that management was there to get the most out of them with little compensation. There was a perception of unequal management justice. People were looked at as means to productivity and output, and not as human beings with feelings. The modern ways have corrected that situation and given employees a say. First, through grievance procedures they have given the employee a vehicle to address their concerns. Managements believe that festering grievances can lead to negative performance and dysfunctional teamwork. These grievances must be heard and removed in quick time. Second, they have involved employees in meetings, committees, and quality circles to get their view on how to improve existing conditions and how to prepare for new changes. Employees are involved at the root level. This involvement is crucial in the hospitality industry as the employees provide direct interface and service to the customer. They make or break business. They are involved in giving feedback on changing customer needs. Managements now respond to employee needs to perform better, in comparison to previous practices when employees had to respond to management directives. The third reason is to give one collective voice through the union. The need for a collective voice came from a semi-literate employee of the industrial age who looked at the organisation as omnipotent. They felt that they had very little chance of influencing it. They felt small and unimportant. They needed an institution that gave them muscle against a powerful organisation. That institution was the union. With their vote in favour of unions, they empowered it with muscle to negotiate for their well-being. The modern worker, on the other hand, is more knowledgeable and qualified and believes in his/her right to assert himself/herself with the management. The knowledge worker is intolerant to being ignored and will leave the organisation that does so because of several opportunities in the job market that he/she has. The knowledge worker is an important co-partner in the success of the business. The management has to listen to him/her as the formula for success because he/she creates the guest experience and knows what matters in a customer-centric world. While the above are the major reasons for joining a union, there are others that are equally significant.

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1. Self Expression Through a Third Party Sometimes employees feel reluctant to represent their cases to the management. They feel that by doing so the management will discriminate and even boycott them, resulting in dismissal. This insecurity becomes more significant when they have little opportunity for alternative jobs in the market. They feel captive to the organisation generating a feeling of being a puppet in the hands of management.

2. Control Over Work To gain control over their own work. Motivation studies have shown that the greatest motivator to human beings is to gain control over their environment and work place. Post industrial revolution, workplaces were inhuman and inconsiderate to the human cause. People had little say in their work and had to perform as instructed. This was largely because of a semi-literate workforce. The modern workplace has changed dramatically though. Managements have recognised the importance of worker participation in work matters. This is largely because of a more knowledgeable and skilled workforce.

3. Social Reasons Unions, like any other meeting opportunity, provide the chance of being part of a group. We learn in “Individual Motivation” in Chapter 12, that people naturally like to bond together. It meets their social needs of interaction and belonging. They form informal groups if formal groups do not satisfy their social needs. These informal groups can make or break a business.

4. Respect Membership to a union gives workers a new status among their peers as also in the eyes of management. Supervisors are cautious in the way they treat their employees who are members of a union. They know that any injustice meted out will bring on the wrath of the union.

5. Unfair Treatment Unions provide a window to air grievances. Workers know that the union officials have their interest in mind. They can get counsel on how to deal with situations, but most importantly, that they can intervene in situations that are unfair.

6. Job Insecurity This becomes more poignant because of modern organisational changes such as restructuring, downsizing, delayering, etc. Workers feel strong when represented by the union with muscle.

7. Poor Grievance System Earlier, management gave scant attention to grievances because they believed that workers had no choice and no where to go. They let grievances fester for days, weeks, and months. Workers with unsolved grievances

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were bound to get de-motivated and let their productivity suffer. In such circumstances, unions provided the perfect alternate source to force grievances to be addressed and resolved.

8. Poor Security System The industrial revolution brought inhuman conditions of work in mills and factories. There was scant attention to health and safety. Sometimes, people worked in toxic and hazardous environments that resulted in permanent health concerns. It is the unions who fought for better working conditions and the provision of safe and healthy environments.

9. Inconsistent Policy Enforcement Sometimes management may be inconsistent in the way they handle policies, rules, and regulations. Unscrupulous supervisors may even be partial to some and impartial to others. This inconsistency can lead to grievances and de-motivation. Unions act as watchdogs to ensure consistent use of policies and rules by the management.

10. Being Ignored This is perhaps the most significant reason to join unions. Motivational studies (Elton Mayo) have shown that one of the greatest ills of the industrial worker was being alienated. Workplaces were unfamiliar to employees who had to work with multi-cultural colleagues and supervisors who could not identify with certain concerns and problems. This led to informal groups which provided the alienated worker with some feeling of emotional security. Unions stepped in and provided the identity that workers wanted in an alien environment.

3. HOW DO WORKERS FORM UNIONS? Workers in an organisation have several ways to form unions. The various alternatives are: 1. A group of workers decide to form a union. They influence employees through personal talk or through campaigns. They educate the workers on their principles and code of conduct and have a ready manifesto to deal with immediate problems. The union leader’s aim is to achieve a 30 per cent membership to be recognised as a union. Each member gets a membership ticket once they have paid a membership fee. Sometimes, members may have their own candidates to become union leaders. In such a case, they hold elections to choose their union leaders. Armed with the right representative percentage, unions register themselves with the labour department. Sometimes workers form an informal collective bargaining group to represent their concerns to the management. 2. Another method available to workers is to join an external registered union. There are unions who represent special sectors. They would like to join those unions which have an understanding and clout in a sector. There are also national unions who represent larger bodies of workers from various industries. National unions would normally represent workers of government organisations. The unions have established rules and conduct of representing workers. 3. External unions solicit the membership of workers. They hold talks with opinion leaders in organisations and are able to hold meetings and talks to understand the concerns of workers and offer to represent them. Unions adopt a bottom-up campaign to influence workers to join them. They use top-down strategy to increase their membership.

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4. Sometimes, workers are split in their view as to who should represent them. It is quite possible to have multiple unions that represent different bodies of workers in an organisation as long as they have the requisite 30 per cent of workers. 5. Sometimes, managements sense that workers want a representation and actively encourage opinion leaders to form a union. Such unions are more management friendly and give the front of a union, yet understand organisation’s stances. Once the majority vote is received, the union registers itself with the Labour Department as the representative of the workers. The union then enters into negotiations with the organisation. The workers also have the opportunity to decertify a union if it has exhibited misconduct that compromise workers. They surrender their membership ticket. Management try to counter the formation of a union, especially an external one, with campaigns of their own. They try to educate the workers towards the disadvantages of unions. However, the management cannot intimidate the workers or dismiss them on grounds of joining unions. By law neither the management nor union can intimidate them. Typically, the code of conduct concerning the formation of unions is: Management cannot: l l l l l l l l l l l l l l l l l

Interfere with or coerce employees by denying their rights for collective bargaining Threaten employees with dismissal or salary cuts if involved in union activities Dominate, administer, or interfere in union activities Influence unions with financial contributions Encourage or discourage workers to join a particular union (unless for security reasons) Reduce pay or working conditions of members who wish to join unions Discharge or discriminate against employees who have filed charges through the union Refuse to bargain with elected representatives of a certified union Fail to bargain in good faith Attend union meetings Introduce unscheduled wage increases Prevent members from wearing union buttons Canvass during off hours Conduct private meetings with employees Ask employees about their vote preference Meet employees within 24 hours of an election Put up their candidate for union election.

Management can: l l l l l l l l

Explain employee benefits Relate management’s past successes Improve working conditions Explain policies that favour employees Explain disadvantages of union membership Point out untrue statements by union Explain that all sides can lose in a strike Explain unfair practices of unions.

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Unions cannot: l l l l l l l l l l

Restrain or coerce employees in their rights to join or not join a union Restrain or coerce an employee from selecting his/her representative Influence a member to discriminate another worker who is not a member Refuse to negotiate with the management if they are the elected representatives Induce a worker to stop work as a measure to get recognition, when another union is elected Influence another stakeholder in doing business with the organisation Charge an excessive or discriminatory membership fee as a condition to join the union Influence an employer to pay monies for dropping issues Campaign for 12 months Cannot force an employee from attending work.

Unions can: l l l l l l

Assemble, nominate, vote, attend meetings, sue other unions, receive copies of agreements Conduct union elections every five years (or any other period as per the Labor Contract) Submit bye-laws of the union constitution File nominations within one month of campaign Regulate financial transactions Go on strike.

4. COLLECTIVE BARGAINING Collective bargaining occurs when union representatives and management representatives discuss better wages, benefits, and improved working conditions. It is a two-way communication where both must appreciate each other’s limitations. To do this, managements and unions need to have the knowledge of bargaining strategies and guidelines in order to successfully protect their interests. HR managers must have knowledge of this as they create employee contracts that stipulate the salaries, benefits, and working conditions. Most collective bargaining agendas centre on compensation as it is perceived to be negotiable. It must be understood that managements are equally interested in the workers’ interests. After all, they serve the organisation and are responsible for the business results. Organisations are concerned with their capacity to pay without effecting business health. The management appreciate unions because they stand for the collective concerns of all employees. The major issues discussed in collective bargaining fall under the following four categories: 1. Salary issues—which include how basic salary is determined, increased cost of living, wage differentials, overtime rates, and performance linked bonuses. 2. Benefits—which include contributions to long-term benefits, paid vacations, health care plans, leave entitlements, etc. 3. Union-Management issues—which include codes of conduct, rights and duties of employers, unions and management, election schedules, etc. 4. Administrative issues—which include employee seniority, employee discipline, termination procedures, grievance procedures, health and safety, technological changes, work rules, job security and training.

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Types of Bargaining Bargaining can take several different forms. The most common are: 1. Distributive Bargaining involves win-lose negotiations. In other words one party has to accede to the demands of the other. Typically, they will state their initial offers/demands and stipulate levels that they cannot cross. The negotiation is in between. In win-lose negotiation, the union uses threats including strikes while the management will respond with equal muscle and take on the strike and even announce a lock-out. External unions usually adopt this approach. 2. Integrative Bargaining involves a win-win negotiation approach where both work towards a mutually acceptable formula. Both parties respect their limitations and work to find a solution that is acceptable to all. The objective of both parties is to find a common ground to build relationships and remove the adversarial element of distributive bargaining. They may come up with creative solutions like training, health and safety, programmes, suggestion schemes, etc. Another term for this kind of negotiation is “interest-based bargaining.” Internal unions usually adopt this approach because they are equally concerned with the health of the organisation that they are part of. 3. Concessionary Bargaining is when the union gives back to the management some benefits it gained in previous negotiations. This approach is taken to safeguard operation costs of the management. Runaway expenses could lead to lay-offs and job cuts to save the organisation. This does not benefit the employees. In other words, economic considerations lead to concessionary bargaining. To foster such concessions, there has to be transparency of information and trust between management and the union. In exchange for concessions, the union may negotiate for performance-based rewards, profit-sharing, or stock options. If organisation closure is inevitable, the union may negotiate for severance pays and ‘golden handshakes’ which are substantial monies to help the discharged employee re-organise his/her working life.

5. THE LABOUR CONTRACT A labour contract is a formal agreement between a management and union that specifies the conditions of employment and the union-management relationship over a mutually agreed period of time ranging from two to five years. The contract specifies the broad issues (compensation, benefits, and working conditions) that both agree to bring to the table. Both sides have to be willing to drop their differences and set a code of conduct that fosters good faith from both sides. Both agree on their obligations to discuss these issues by setting time schedules when they shall meet on the subject; convenient locations for such meetings; submission of realistic proposals by the union, reasonable counter-proposals by management; and that both parties jointly sign on the agreement reached.

Labour Contract Negotiations A great deal of preparation is required by both parties before going into negotiations. For this there is time given by both parties for negotiations. Each must develop their own plan and strategy. Basically, preparation involves data-collection. Data collection is an ongoing process but these are collated and analysed closer to the time of negotiation. They shall study the following information:

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1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16.

Diagnosis of the mistakes and weaknesses of previous negotiations Recent contracts of competitors in the area Comparative industry and occupational wage ranges and benefits National, regional, and local economic conditions Consumer price indices Cost-of-living trends Organisational short- and long-term outlook Existing job grades and when they were last revised Overtime data Analysis of grievances Disciplinary actions Recent transfers and promotions Job enlargements and comparative pays Organisation’s future plans and expansions Performance measures Recent performance rewards.

Each party assigns the task of preparation to a team of ‘researchers.’ Each party develops a written plan laying out the bargaining strategy. It sets the parameters of negotiation, especially the limits to which they can concede. By this, they are able to prioritise the important issues. In collective bargaining there are certain issues that can be brought to the table. They may be classified as: l l l

Mandatory Voluntary Illegal

Mandatory Issues l l l l l l l

Wages Incentive pay Layoffs and Recalls Management rights Safety Retirement Drug testing

l l l l l l l

Hours of work Overtime Security concerns Seniority Benefits No-strike conditions Grievance procedures

Voluntary Issues l l l

Supervisory compensation Performance bonds Company price/product issues

l

Supervisory discipline Contract ratification

l

Close shop agreements

l

Illegal Issues l l

Violation of laws Bribing

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At the date and time of negotiations, both parties send their respective representative teams. The union will have the union officials, union stewards, and one or more specialists from the national union staff. Management’s negotiating team consists of HR Manager (or the labour relations specialist in the team) who heads the team, one or more operations managers, a labour lawyer, the compensation and benefits specialist, and perhaps a consultant on collective bargaining. The first objective is to create a climate for negotiations. The tone establishes whether the climate is hostile or suspicious or in mutual trust. This is assessed in the early introductions and casual banter. In the early chit-chat, the parties try to establish their authority. They also discuss and agree on the agenda of the discussion. Both parties guard against revealing their priorities lest they have to pay a heavy price for it. The union representatives are the first to present their initial proposal which is in writing. Obviously, the proposal will be more than what they expect to end up with. The demands should not be outrageous, so as to cause discredit in negotiation. The management negotiating team then states the management’s case, often presenting excessive counterproposals that are reasonable enough to avoid losing face. Normally, the management team extol what they have done for the employees and state that they have been fair to the employers. They normally bring comparisons with the competition, highlighting those issues where they are superior. The management also tries to explain the changing market place and the new opportunities the employees will get. The distant stances each party takes slowly move towards conciliation as discussions proceed. As each item is discussed, each party assesses how far the other is willing to go in giving concessions and the minimum level each is willing to accept. It is recommended not too have limits that are to extreme. The limits should be flexible so as not to bring discredit should a concession be given. “Take it or leave it” proposals are typically ineffective. Successful negotiation are contingent on each side remaining flexible. It is hoped that the figures that are finally agreed upon are within the maximum and minimum levels of both parties. Figure 11.1 below gives a good idea of this: Union’s Desired Objective

Maximum Management’s Tolerance Limit

Union’s Realistic Expectation

Bargaining Zone

Management’s Realistic Expectation

Minimum

Management’s Desired Objective

Union’s Tolerance Limit

FIGURE 11.1 | Expectation and Tolerance Levels The bargaining zone is the limit to which both parties are willing to concede. The objective of negotiations is to bring the other party within the bargaining zone. There is an element of concession by both parties. If either party is rigid, then it is bound to result in an impasse. This is when negotiations breakdown. However, both parties understand this and give time for the other party to review their stance. They postpone deliberations on the difficult issues and clear lesser issues to show progress. Sometimes, negotiations go on for several weeks. If neither party is able to compromise and resolve a deadlock, then they have an option to call in a mediator. The mediator is a neutral third party who reviews the dispute and opens up communication channels

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with compromise solutions and concessions. A mediator comes in when both parties are willing to be flexible. He does not have any power or authority to impose a solution. His inputs are purely recommendatory in nature. Should the negotiation reach an impasse, the last resort is arbitration. Both parties share the cost of the arbitrator and weigh the benefits of going to an arbitrator against some concessions by both parties. It is a disincentive to go into arbitration which can be a costly affair. Arbitration involves bringing a third party arbitrator (or adjudicator) who is a person mutually agreeable to both parties to break the deadlock between the union and management. Unlike the mediator who has only recommendatory powers, the arbiter brings a ruling that is final and binding on both parties. Most private sector organisations prefer to resolve their differences at their level. Either the union withdraws their claims or the management makes concessions. The arbitrator is usually brought in by public sector organisations that use him in order to ward off a strike. Arbitration is usually used in grievance disputes of employees. The management must agree to an arbitrator if a grievance is not resolved. The arbitrator is usually selected from a panel of names provided by the labour department. They are usually with a legal background with considerable knowledge of labour laws and are respected as being impartial. The arbitrator can be a permanent one as per the union agreement or someone chosen on a case-by-case basis. Most organisations prefer the later. Arbitration is a quasi-judicial proceeding but less formal than a court. Here, each party is responsible for presenting facts and information about the issue. The arbitrator does not actually go out to seek information as a detective, but makes decisions based on information provided to him. He may ask for more information and even examine witnesses (in the case of employee grievances). Throughout the proceedings, a court recorder is present to prepare the transcripts for the formal ruling. The ruling is done in writing using the formal legal language wherever possible. Usually, the arbitrator’s decisions are based on the facts of the case and not on any previous rulings on the case. The time taken for arbitration is usually 30 days.

Union’s Powers in Bargaining The union has the power to economically hit the employer. It generally takes one of these forms: strikes, picketing, and boycott.

Strikes A strike is halting of all work. There are different types of strikes: l

l

Strike with Notice: This is when management is given a date and time when work will stop. This is a civilised way to browbeat management to re-think their proposals and prevent the strike from actually happening. On the other hand, the management gets time to make alternative arrangements to provide service. The success with which they make alternative arrangements can also deter striking employees to think whether to go on strike. Management can also use the time to influence opinion leaders among the workforce from going on strike. Wildcat: These are flash strikes when people just walk out of the premises suddenly leaving the management in a crisis. This can be devastating in the service industry where customers are in the process of receiving service. It can be bad for the image of the organisation which will take a lot of time to reclaim the customer’s trust.

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l

l

l

l

Sit-down: This is when employees stay at their workplace but stop working. This can be bad for the service industry to experience uncooperative workers. To customers, this attitude will reflect poor service and force them considering moving their business elsewhere. Lock-out: This is a management stance of closing operations and not allowing workers from resuming work until the union comes to a compromise. Of course, this means loss of business and goodwill among customers. Confirmed business is diverted elsewhere to the competition. A lock-out is a lose-lose situation where the employees and the management suffer irrevocably. Work-to-rule: This is a method where employees will do just enough as per their job descriptions. They will also close shop when they finish their official shift timings. Obviously, productivity suffers and in the hospitality industry, it means denying the customer that extra service that makes the organisation competitive. Go-slow is a process whereby the work slows down even below normal productivity. In the hospitality industry this can affect the efficiency of services and the management will receive continuous customer complaints of poor service. Customers are not concerned with internal processes and can perceive only shoddy service. Employees find ridiculous excuses for not giving proper service. To the management, there can be loss of goodwill with the guests that patronise them.

Strikes are a much dreaded means to coerce the employer as it means loss of business. In the hospitality industry, it also means loss of image and reputation. Guests’ perceptions are that they do not want to associate with a service provider who is unstable. Strikes occur when the union is unable to obtain an acceptable offer from management. Normally, before a strike is called, the union assesses the implications of such a move. First, employees are affected through loss of pay and suffer hardships. There is general insecurity. Second, workers may be unwilling to take this step. There are issues of loyalty and commitment to work that differentiates this approach. Third, not all employees will agree to a strike. Some loyal workers will continue to work. The organisation may reduce their level of business with the hands they have. Fourth, the union has to take into account the possible actions of the management in case of a strike. (a) The management can close the operation and announce a lock-out. (b) It can operate with the executive and supervisory staff that will have to roll up their sleeves and do hands-on work. (c) It can hire temporary and part-time workers. (d) It can cut some services and make do with those workers who do not join the strike. There are a number of risks to the union to call a strike: 1. The union is under pressure to make the strike succeed. A failure is a loss of face to the union. 2. The workers are in distress with loss of pay and may pull out of a strike prematurely, before it can have an effect on management. 3. Workers can lose faith in the union if the strike does not succeed and de-certify the union to represent them. 4. A strike can result in a loss of members. 5. The union may gain a negative reputation among those members who wish to employ them. 6. Replacements can take over the jobs of some employees. 7. It gives the management the opportunity to weed out the undesirable workers.

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Picketing Picketing is when striking employees wish to publicise their dispute with management by discouraging workers and guests from entering or leaving the premises. They seal the main accesses to the premises and shout slogans and display placards. It can severely affect the business and reputation of the organisation. Picketing can become very emotional and violent, especially when replacements are prevented from entering the premises. There is a lot of slogan shouting, verbal abuses and physical assaults. The picketers want to destabilise the organisation and force them to concede. Properties hire security personnel and sometimes the local police to gain access to temporary workers and those workers who wish to rejoin work.

Boycott Boycott is a strategy that refuses patronage to an employer, i.e. refusing to buy or use the employer’s products and services. It is used mostly in the manufacturing sector because employees in the hospitality sector are not allowed in any case to use the products and services on the belief that guests do not like to share the privilege of products and services with the people who serve them. Boycotts are of two types: the primary boycott where employees are legally forbidden to use the products and services, and the secondary boycott where the union influences or prevents other suppliers and stakeholders from using the products and services. This is illegal.

Management’s Powers in Bargaining The management comes to the bargaining table with its own set of powers. Foremost among them is the power of money. The organisation has the capital to spend as it wishes as long as it is within the law. The organisation has many choices in deploying its financial resources. It may buy new equipment, or start a subsidiary, or enter into a new product range, etc. One of the choices is to pay its employees better. Every organisation likes to give its employees fair pay for the work they put in. Without being exploitative, they would like to keep the wage bill within a manageable limit as salaries are a recurring cost involving long-term commitments. Organisations normally follow the industry norms as to what the wage bill should be in relation to its revenues. Runaway salaries can threaten the organisation’s survival in the long run and may even force it to close business. Organisations may even endure a strike if it feels that the cost of it will secure future labour contracts favourably. The second great power that management has is the choice whether to retain an employee or not. Managements can insist on good performance from its employees and decide whether mediocre performance is acceptable. The management may prefer to opt for performance-linked pay rather than across the board increases which do not distinguish between the mediocre and the best employees. The third great power that management has is to decide on the number of people it wants to keep. Today, organisations exercise their right of downsizing, delayering, or restructuring if the business is threatened. Though they pay handsome severance pays, the employee has no guarantee of permanent employment. Should wage bills threaten business survival, the organisation can exercise their choice to manage with fewer numbers and introduce technology to fill the gaps. Also, management can decide on the quality of human resources. This becomes critical in changing times. As knowledge workers are replacing industrial workers, the concern for competence in a new technological world is becoming increasingly valid. Managements can insist on self-development to upgrade skills or look elsewhere for better quality of human resources.

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What do Union-Management Bargain? The bargaining agenda may be classified into: l

Economic Issues

l

Non-Economic Issues

Let us see what they include:

Economic Issues l l l l l l

Wages Management discretion Profit sharing Pensions Holidays Sick pay

l l l l l

Pay ranges Wage adjustments Bonus plans Insurance Vacation

Non-Economic Issues l l l

Quality of Work Work rules Types of work

l l l

Union security Size of workforce Grievance procedures

6. MANAGING GRIEVANCE A grievance is a formal complaint about an action or practice that violates a worker’s work understanding or contract. Most grievances are expressed by individuals but there are also grievances that are expressed by groups. A grievance procedure is a process of registering a complaint, evaluating it, coming to a decision about the grievance, and communicating it. Grievances could be personal or official. The belief behind a grievance procedure is to ensure that the grievance is aired and actioned so that it does not fester into low productivity morale or more seriously, a union intervention. Grievances do occur in a fast-paced work environment when people are pursuing performance. There are two types of grievances: (1) Personal grievance and (2) Work-related grievances. Let us look at what issues come under each and how a supervisor can resolve these in Tables 11.1 and 11.2. While these are common grievances, there could be others. The resolutions too may have to take into account the local circumstances. The basic approach to handling grievances is to have an open door policy. Employees must feel free to express their grievances and not have the fear of reprisals. The management must give the employee confidence on this matter and must view that it is an employee’s right and privilege to express a grievance. A grievance is usually expressed orally by an employee to his/her immediate supervisor. An effective supervisor will ‘nip the grievance in the bud’. In other words, he/she will act upon the grievance immediately and resolve the issue. It is only when grievances are not attended to in the first instance that an employee is forced to put it in writing. The advantage of a written record is that it confirms that a grievance exists and that there is no distortion to the grievance. In the examples above, most solutions are within the control of the management. It shows that methods of operation have to be reviewed constantly.

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TABLE 11.1 Personal Grievances Issue Non-cooperation from colleagues

Possible Resolution n n n

n

Feeling ignored

n n

Over-work

n n n n

Under-utilised

n n

Poor compensation

n n n

No advancement

Review team spirit and either call a team-meeting to reinforce team spirit. Organise a team-building workshop. Review systems and procedures to analyse their contributions to perceptions. Counsel the employee on how to gain cooperation. Give more attention. Delegate some responsibilities that will bring about greater interaction. Review sanctioned strength if additional persons required. Assign another under-utilised person to help. Roll-up the sleeves and help the employee especially at peak times. Rotate the employee to easier jobs. Enlarge the job. Delegate some responsibilities. Review salaries and wages. See if employee needs financial assistance to tide over a financial problem. Link performance to productivity so that the employee can earn more pay.

n

Review career objectives with employees. Recommend for training and development. Enrich the job. Enlarge the job. Provide cross training. Counsel employee on self-development for better jobs.

Health and safety issues

n

Rectify health and safety issues immediately. It can become a legal case.

Sexual harassment

n

No recognition

n

n n n n n

n

Refer the matter to the supervisor immediately. It can become a legal issue. Give recognition. Simply announce the good performance in the next staff meeting. Counsel employee what better performance is required to get recognition.

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TABLE 11.2 Work-related Grievances Issue Tasks outside job description

Possible Resolution n

n

Need for training to improve productivity Unreasonable boss

n n

Examine Job Description and evaluate whether it deserves job enlargement Review extra tasks and assign to someone else Conduct training needs analysis Recommend for training

n

Employee should approach higher authority for resolution Counselling of boss

Poor working conditions

n

Improve working conditions

Work not challenging

n

n

n

Rules not being followed by supervisor or colleagues

n n n

Lack of team spirit

n n

Delegate additional responsibilities Give special projects Re-emphasise code of conduct at briefings Evaluate if rules need revision Employee should give feedback to HR Manager if supervisor is erring Counsel team Organise team-building workshop

The most important aspect of a grievance is that the employee should get a reply within three days. Most grievances are dropped by employees if they see that the management has considered it important and has given a reply. Some grievances cannot be resolved immediately but employees need to know the course of action the management is going to take to address it. Employees need to be given constant feedback on long-term resolutions. It is when grievances are not given importance and the employee is not given feedback on grievance resolution that the employee goes to the union for intervention. To avoid reaching the stage of the employee going to the union, managements employ a simple grievance procedure: 1. The employee must approach the immediate supervisor and express the grievance. 2. The immediate supervisor may resolve it at his or her level and give a feedback to the employee. 3. If the employee does not get an answer in three days he/she is authorised to go to the next higher authority who must respond within three days. 4. If the higher authority does not respond within three days, then the employee is authorised to go to top management with the grievance and it must give a feedback in three days. The system ensures that the grievance is not allowed to fester and that a solution or feedback is given within a reasonable period of time. The employee cannot be censured for going to higher authority if the grievance is not resolved or if he is not given feedback within three days at each level. As a matter of fact, the managers at each level are censured for not taking action.

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If, because of negligence on part of the management, an employee approaches the union steward, he/she must give her grievance in writing. Most grievances are given attention immediately when the union steward presents the grievance to the management. However, there are managements who take a tough stand and turn the event into a win-lose situation. Sometimes, a mediator is brought in to resolve the situation. Basically, the mediator gets the two parties to communicate with each other to resolve the issue. The mediator only recommends a resolution. A grievance may gain momentum when other employees with the same grievance join in. Such disputes may even call for arbitration. Such cases are rare and usually centre around a dismissal from service, or being overlooked in promotion. An employee is usually bound by the labour contract as far as compensation and benefits are concerned. Pay issues are only brought up in the next union negotiation.

7. MANAGING DISCIPLINE Discipline is self-control. It is the hallmark of a good hotel professional. Discipline is required for many reasons: (a) Guests like to see employees in professional outfit doing their duties with clockwork precision. (b) Indiscipline reflects on the image of the property, which can be ruined through word-of-mouth. (c) A lack of discipline severely affects the final quality of service. (Imagine a room attendant who forgets to log a request for baby-sitting services by a guest or a room attendant who forgets to leave water tumblers in the room. (d) It reflects on the hygiene and sanitation standards of the property if employees are not well groomed and unclean. (Imagine waiters with soiled uniforms!) (e) There is discipline in the way employees communicate with guests. A lack of courtesy, etiquettes, and manners can spoil the entire experience for a guest. (f) Discipline is necessary for following systems and procedures to avoid chaos during busy operations. Shortcuts to service invariably affect standards. (g) Discipline is necessary for coordination with other departments and fellow-members to get their cooperation. If the kitchen decides to slow down its service, the restaurant brigade will be faced with the wrath of the guests as they are in the frontline. (h) Discipline in punctuality and attendance—If there are no “warm bodies” the restaurant cannot give the desired standards of service. Indiscipline happens for several reasons. Table 11.3 below gives the reasons for indiscipline and how they can be addresses. While the above are some reasons for indiscipline and how to deal with them, the following are some general guidelines to maintain a disciplined team: 1. Ensure that there are written house rules and code of conduct. These must be distributed to each employee and reinforced at briefings. 2. Motivate staff to follow rules and maintain discipline. Inform them how it can benefit them in terms of advancement, better tips, and cooperation from team members. 3. A fault committed must be checked at once.

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TABLE 11.3 Reasons for Indiscipline Reasons

Course of Action

Unavoidable Circumstances

Pressing domestic situations like family sickness, parent-teacher meetings, etc. cannot be avoided. This should be excused provided the employee has excused himself or herself before the operation starts. Any proof like a medical certificate authenticates an absence, however, the housekeeper is guided by the track record of the employee.

Adventurism

Young employees are hot blooded and like to beat the system. Don’t kill adventurism because it can be converted to enthusiasm. Give such staff challenging tasks and additional responsibilities that will occupy their time and need for adventure.

Lack of Control Systems

Many acts may seem as indiscipline, but actually they are caused by a lack of systems and procedures. A manager must seal loopholes in the system. A written code of conduct is also necessary to let employees know the rules. The manager can seek the assistance of the human resources department to draw-up a code of conduct.

Ignorance of Rules

Ignorance of rules is a crime and therefore, employees can be penalised for this. However, the manager must re-emphasise rules during briefings to keep such things on top of the mind daily.

Attention

The industrial age has brought isolation and anonymity when huge work forces are employed. It is easy to be ignored and lonely. Many people deliberately cause indiscipline to attract the attention of the supervisors. A manager, in the first instance, must know and hold dialogue with his/her team collectively and individually to get respect. It is a necessary ingredient of leadership.

Not Accepting the System

The manager should counsel the employee and make him/her realise the importance of the system and how it fits into the larger scheme of things.

Rebellion

People rebel because of perceived injustice. A manager can sit with the “rebel” and understand the injustice meted out to him/her. Well defined grievance procedures have helped in avoiding rebellious situations. More important is that the manager must be fair and equitable in his or her dealings with the team.

Affiliation with Negative Groups

The manager should identify these negative groups and their leader. He/She should try to understand the reasons behind negative behaviour. Win over the group leader by giving him/her importance and a say in proceedings.

Bad Habits

Reinforce good habits during training sessions and briefings.

Shortcuts

First counsel and then penalise the employee after giving two warnings.

Wilful Motives

People with wilful motives are dangerous. If counselling has failed, then dismiss the person from the team.

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4. Always discipline in private. 5. Set an example by being self-disciplined. Staff must see their supervisor as the role model. 6. Check the Labour laws regarding disciplinary proceedings. Normally, two warnings are given in writing before formal charges can be made. 7. Take the help of the human resources department who are trained and qualified to handle disciplinary proceedings within the law.

8. EMPLOYEE SOCIAL PROGRAMMES An important role of the HRD department is to organise and implement certain social programmes for the employees. These social programmes serve the following purposes: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

Give employee a sense of belonging Create a sense of camaraderie Improve employee morale Take employees away from the humdrum routine of work Support employees with personal, domestic, and social needs Bring management and staff together in a fun environment Help employees link with those from other departments Are an opportunity to reward and recognise Link employees with the community and its concerns Bring out the other talents of employees and recognise them Thank employees for their commitment, thereby reinforcing it

The various programmes that organisations employ are:

Sports This is a wonderful way to foster healthy competition and keep the workforce fit. This is particularly important in the hospitality industry that requires employees to be fit in a physically exacting environment as also to develop cooperation between departments. It is a time to develop sports talent within the workforce who gain their special place in the organisation because of their sporting achievements. Some organisations participate in inter-organisation tournaments that are covered by the media. The organisation gets its free publicity through the triumphs of their team. Sports may be classified as indoor sports like badminton, table tennis, squash, darts, and carom; and outdoor sports like cricket, football, basketball, volleyball, tennis, and athletics. The HR department can organise activities for sheer recreation or for formal tournaments.

Socials These are annual or bi-annual get-togethers of all management and staff. The hotel industry has a great advantage of banquet space, food preparation and service, and bar services. The social consists of variety entertainment using the talent of staff, guest star performers, dancing, party games, wining and dining. Usually, the management serve food to the staff as a gesture of goodwill and thanks. The social is a wonderful platform to present certificates of recognition (e.g. “Best Employee of the Year” award) as also prizes for various tournaments and party games. The hotel industry approaches their suppliers who willingly give gift hampers and attractive prizes for the staff. They treat it as goodwill gestures to the hotel for their business. It is a

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wonderful opportunity for management and staff to mingle and share some light moments together. It is also the opportunity for the Chairman to address the management and staff to share the business strategies, performance results, seek recommitment, and most importantly, to thank the staff for their contributions.

Counselling Services These are very valuable to employees to see answers and direction on personal matters, job matters, family matters, career issues, training issues, re-employment issues (in case of termination or lay-off), performance issues, and employee issues. It is very important for the hospitality industry to have a workforce free from tension so as to give guests a good service. This service is usually provided by the HRD department through a dedicated counsellor or someone outsourced. Matters discussed are kept exceedingly confidential and counsellor helps employees to find their own solutions to the problems.

Health Clinic Large hotels maintain a clinic with a qualified medical practitioner who can give immediate attention before hospital assistance is sought. The hospitality industry is about people. There are guests who need medical attention as well as employees who are put under physical stress. We cannot forget the hazards in a kitchen, for example. There are ample opportunities for cuts, burns, slippage, etc. The housekeeping too are exposed to toxic cleaning materials and have to do hard physical tasks that could result in strains, backaches, cramps, nausea, etc.

Crèche Support to working mothers has become a growing concern in nuclear families where both the husband and wife have to work to make ends meet and to earn the little luxuries of life. Domestic help is not always available or affordable. A crèche is a great support to women. It reduces absenteeism, turnover, and lack of punctuality of female employees. It enables mothers just returned from maternity leave to nurse their child. A crèche has qualified child carers who feed and keep children occupied in a fun environment where they also learn.

Grocery Store A hotel buys in bulk items that are useful for the home. From basic toiletries to dry food rations, the hotel has it all. Some hotels leverage their purchasing power to pass on the cheaper rates to their employees by opening a grocery store. It supports employees who can complete their grocery shopping at the workplace tremendously.

Life-skills Orientation This is especially valuable to employees entering a working environment for the first time, especially outstation employees and expatriate employees in a multi-cultural workforce. The HRD department drives this programme to complete a vast number of skills such as opening a bank account, finding accommodation, knowledge of local customs and practices, transportation facilities and how to get around, social etiquettes and manners, local dos and don’ts, getting driving licenses, enrolling into local associations and clubs, programmes on time management, managing the boss, team work, etc. This helps employees adjust to their local circumstances as

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early as possible to start performing freely at the job. We must understand that the hotel industry is a place of high society social interaction. Many employees may be introduced to it for the first time. They need to be empowered to deal with the new environment which includes addressing their anxiety and fears.

Socialisation It is part of the orientation process for new employees. The socialisation bit concerns introducing a new employee to members of the organisation so that the employee is able to develop the relationships necessary to perform. A new employee may not be able to meet everybody, but should definitely meet senior executives, immediate supervisor, and team members. The specialist in the HR department in-charge of orientation and socialisation may have to ‘hand-hold’ the employee in the first week. Sometimes, he/she assigns a member of her immediate team to do it. The main focus is to get the new employee internalised into the organisation and be comfortable with relationships within the organisation.

Environmental Programmes The hospitality industry is very conscious of environmental issues and supports it. The future trend is for hotels becoming eco-friendly using materials and processes that do not harm the environment and ecology. Some of the steps used are the recycling of paper, bottles, cans and tins, etc. It is essential, therefore, that employees are committed to environmental issues and participate actively and otherwise in these issues. To serve the community, the organisation organises environment drives such as cleaning the beaches, keeping the hotel and its environment clean, planting tree saplings, participating in eco-marches, and running other community programmes. The HR department drives such environment programmes on behalf of the organisation.

9. SUGGESTION SCHEME A suggestion scheme is a system of employee feedback towards continuous improvement. In the modern age of business, the employee is given enriched jobs, autonomy to work, and accountability for their actions. This is on the belief that they are the ones who create guest experience, especially in the service industry. Organisations have de-layered their hierarchies pushing decisionmaking downwards. Managements, who were the custodian of knowledge and authority earlier, were sometimes far removed from the realities at the service-end. They now understand that the server is important and his or her views are essential for excellent service. Their participation to continuously improve is vital. Management has, therefore, created many participative groups like quality circles, continuous improvement teams, safety groups, learning groups, etc. to get greater employee involvement. The precursor to this participative model was the suggestion scheme. It was a time when employees were semi-literate but still had wonderful ideas from their hands-on experience in operations. Earlier, they did not get an opportunity to air their views or were plain diffident to put them forward. Organisations valued their inputs when they began to think that employees mattered to the success of business. The suggestion scheme started with a conveniently placed suggestion box where employees could write their ideas. Some organisations may make it more formal by devising special forms to fill. The more easy and informal the scheme, the better it was to get the employee to come forward.

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These ideas were evaluated periodically by a committee of senior management. The committee could be flexible to include the expert on the subject. The ideas were studied and the employee interviewed, if needed, to get a better understanding of the suggestion. They would then test the suggestion out in a controlled group and with its success expand it throughout the organisation. Types of suggestions could fall in the areas of: l l l l l

Customer service delivery Equipment Processes Revenue Quality improvement

l l l l l

Productivity Procedures Cost-efficiency Better teamwork Innovation

Once the suggestion is accepted on the way the work is done, the employee is recognised and even rewarded. This recognition is done in employee social gathering, like the annual staff party, to spread the message of the importance of continuous improvement and innovation. Some organisations give cash awards or valuable gifts because the suggestions would have earned the organisation revenue, cost-efficiency, better productivity, or a competitive edge.

10. EMPLOYEE EXIT An employee exit is when an employee ceases to be in employment with an organisation. It is the end of a contracted relationship. Employee exits happen due to several reasons:

Termination Termination is a cancellation of employment initiated by the organisation. There are several reasons for a termination: 1. Consistent poor performance 2. Insubordination, which means not carrying out the instructions of the supervisor, or being disrespectful to him/her 3. Not following policies and procedures laid down 4. Consistent unauthorised absences 5. Poor health leading to lack of performance and absence from work 6. Obsolete skills which seem to be a common malady in modern times 7. Organisation re-structuring, downsizing, delayering, etc. 8. Failure to be a team player 9. Misconduct (assaulting an employee; coming drunk to work, taking drugs, neglecting work, etc.) 10. Being disloyal to the organisation (e.g., leaking information to competitors) 11. Being misfit in the organisation culture. Termination is a delicate matter and requires careful handling. Though an organisation has the privilege of terminating an employee’s service at will, it is restricted by labour laws and unions. Typically, an organisation has to appear to be fair in making such a decision. Some guidelines are: (a) that policies and procedures are applied consistently; (b) the decision is consistent with earlier decisions on the same matter; (c) the employee has been given feedback and a chance to alter his behaviour or performance;

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(d) that honest efforts were made to improve performance through training and development and behaviour through counselling; (e) the employee has had a chance to state his/her position; (f) HRD has been consulted; and (g) the union has been consulted in highly unionised environments. The usual termination process is: 1. Giving the employee a verbal warning (followed with counselling and perhaps some corrective actions like training). 2. If the problem persists, giving a first warning in writing. 3. If the problem still persists, giving a second warning 4. Issuing a termination order in writing. In the process above, the employee has been given enough notice of his performance or behaviour and a chance to amend his or her ways. All actions leading to a termination must be written and the employee’s signature received in acceptance of having received warning letters. It is more difficult to terminate rank and file than it is to terminate an employee at the level of the management. Staff are unionised and it is prudent to keep the union appraised of each warning given to the employee. Unions may also be asked to intervene to counsel the employee. Appointment letters stipulate the notice period when serving a termination. The notice period usually ranges from a month to three months depending upon the importance of the job. Termination during a probation period may be made giving 24 hours notice. The notice period is given to give the employee a chance to seek alternate employment and the organisation to find a replacement. The salary is paid during the notice period. The management or the employee may forego the notice period by paying the other party compensation equal to one month wages for each month of the notice period. Some organisations prefer to incur the cost in vital positions to prevent any form of ‘sabotage.’ They recognise that the employee is ‘switched off’ during the notice period, and in malice, may incite other workers, pass on information to competitors, destroy information, spoil equipment, etc. Employees prefer to avoid serving notice to save face with the other employees. All terminations must take legal counsel before they are served. Terminations that do not follow all the precautions are liable to become labour disputes requiring arbitration, and sometimes, cause embarrassment to the organisation.

Guidelines for a Termination Interview Before the Termination Interview l

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Study the employee’s personal file and ensure that all procedures have been followed in writing. Two warning letters must be on file. Ensure that the warning letters are for the same misdemeanour. If in doubt consult the legal advisor. The labour laws, company policy, and union agreement must be satisfied. Ensure that a full investigation has been held for incidence of misconduct. The investigation report must be in file duly signed by the investigating officer who is preferably a third party. Prepare the severance compensation ensuring that all dues are covered. Make a list of all items belonging to the company that are in the possession of the employee. Identify a person to take over the company possessions including information and files in the possession of the exiting employee.

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Consider the appropriate time of the day when the termination will be served (usually after the shift when employees have gone for the day. This will minimise the negative impact of such a termination on other employees as well as uphold the dignity of the employee. Decide whether the organisation wishes to serve the notice period. It is better to let employees in non-critical positions to leave immediately.

During the Interview l l l l

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Have a witness present when serving the termination. Maintain full control of the meeting. Ride out the storm of the initial emotional outburst of the employee. Be firm and get to the point immediately regarding severance compensations, notice period, outline of the letter of service with the organisation, and give suggestions for alternative employment outside the organisation. Outline a joint strategy as to what will be told to others that will minimise the embarrassment. Suggest not meeting other employees except the person to hand over charge. Tell the employee to leave the premises immediately to vent the frustrations outside. Get the employees signature on the copy of the termination letter. Do not apologise for the termination but shake hands with the candidate and wish him or her the best for the future.

After the Interview l l

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Update the personnel file and store it. Provide the handing over list to the person identified to take over and get his/her signature in confirmation that handing over is complete. In the hospitality industry the following departments have to sign the handing over form: uniform room supervisor for uniforms, accounts department for any outstanding loans and advancements, general cashier for any petty cash outstanding (for cashiers), engineering supervisor for hand tools and equipment (for engineers); personnel department for ID cards, name tags, time card, locker key. Give the severance pay only after all dues are received and the person cleared. Sometimes, financial outstanding may be adjusted against the severance pay if the person is unable to clear it. Inform the security to stop access of the terminated employee to the premises. Review how the termination could have been prevented. Look at recruitment and selection policy, training and development, supervision, etc. Communicate the termination to the rest of the team as jointly agreed with the terminated employee. Inform the person who will cover those responsibilities till a replacement is found. Inform the recruitment and selection specialist to find another person providing a job specification.

Terminations due to General Layoffs In recent times, organisations are compelled to announce major layoffs because of changes in business strategies. Such layoffs are undertaken as a matter of survival. Obviously such a major step requires the involvement and support of the union. Initially, unions are bound to resist, but when provided with facts and information, will agree, provided the employees are compensated well to resettle themselves. The organisation considers the following when deciding on a lay-off.

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l

l l l l l l

A ‘golden handshake’ which is an attractive severance package to help individuals rehabilitate themselves. Assistance in finding an alternate job. Career counselling to help employees find solutions towards future directions. Training employees in skills that will be useful to gain employment elsewhere. Examine whether skills can be utilised in other associate companies of the organisation. Write-off company loans taken by the employee. Continue benefits (like health coverage, life insurance, etc.) for a specified period upto a year.

Resignation Resignation is a voluntary termination of an employment contract with an organisation by an employee. In modern times where opportunities of employment abound for qualified personnel, quick mobility is a common practice much to the dismay of organisations. While organisations may anticipate and prepare for a degree of employee turnover, the unanticipated ones are of concern. Why do people resign? l l

l l l l l l l l l

Better salary offer by competitor Poor work culture in the existing organisation Job not challenging enough Unreasonable supervisor No training and development Lack of cooperation by co-workers Change to a different profession Do not see organisation growth Being superseded by juniors No recognition and rewards Moving out of the city

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Offer of higher position by competitor No career plan within the organisation Poor fit between talents and the job Fear of layoffs due to organisation restructuring Possess inadequate skills for the job Anticipating a termination Unable to adjust to multi-cultural environments Domestic reasons No advancement Poor working conditions Move to a bigger banner

Resignations are offered in writing by the employee to the employer. They mention whether they are serving the notice period or not. If the notice period is not being served, then the employee has to pay equivalent to one month’s salary. The management too can decide to accept a notice period or terminate the employment immediately by paying one month’s salary. However, it is usually a mutual arrangement where no party suffers. Organisations may welcome a 10 per cent employee turnover when: l l l l l l l l l l

They want to get the latest skills into the organisation Organisation is moving to a leaner structure Poor performers leave There is a misfit between the skills and job An employee is not adjusting as a team member An employee is a misfit to the organisation culture Organisation wants to infuse youth Organisation is unable to provide a career growth to an individual Organisation has changed its business strategy requiring new skills Organisation is unable to meet the competitor’s salary offer

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Organisations do not welcome resignations when: l l l l l l l l l l l l

The employee is a high-performer The skills are rare to find The experience with the organisation is valuable Considerable investment is made in the individual through training and development The employee is going to the competitor The cost of recruitment is high The position will lie vacant, especially in guest contact jobs The employee takes with him/her guest contacts The employee is a critical member of a work team The employee’s exit will cause a loss in morale The employee is likely to take other key performers with him/her The resignation will affect organisation performance

The first action to a resignation is to investigate the reasons for a resignation. Organisations work hard to retain key performers through counter salary proposals, a better position, reinforcing the career plan, etc. Bureaucratic organisations are less flexible to make counter proposals due to rigid grade structures, union interventions, and helplessness to reward an employee out-of-turn. Modern organisations are more flexible to accommodate out-of-turn counter offers. The organisation must be very clear to identify the high performers and follow their progress closely. A policy decision must be made to retain them at all cost. Organisations must, however, strive to create conditions where the employee is loyal and does not want to leave. Some ways to do this are: l l l l l l l l l l l l l l l

Recruit employees who are the right fit to the organisation culturally Be competitive in compensation and benefits Orient and socialise new employees thoroughly Have a career plan that involves the employee’s aspirations Giving the employee feedback on performance Help the employee learn new skills and improve performance through training and development Give the employee a say in shaping the work environment, thereby enhancing commitment Provide a safe working environment Have a timely reward and recognition scheme, especially a merit pay for good work done. Have leaders as coaches Provide opportunities for growth, development, and advancement Be transparent and let employee know the progress of business Have effective mentoring and counselling schemes Have an effective grievance procedure Be empathetic to family needs

A valuable part of resignation is the exit interview. An exit interview is to get a feedback on the organisation. An employee who is leaving will be less on guard and will be more forthcoming in feedback. The interview must be without distraction and the interviewer a listener. He/She should be prepared with written questions to ask to ensure all aspects of the organisation are covered. The responses in the interview help the organisation to review some of the ways of its working. Alarming resignations may need some change in policies and sometimes, a complete organisational development input.

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Here is an exhaustive list of issues that are discussed in an exit interview:

Organisation l l l l l l l l l

Were the organisation’s mission’s and objectives clear? What areas of the organisation culture were dysfunctional? What could the management do to improve its effectiveness with employees? What are the weak points of the organisation? What are the strong points of the organisation? Was the compensation adequate for the job? What additional benefits would secure employees commitment? Do you find our career planning system effective? If not, what suggestions do you have? Did the training and development help in your performance? If not, what suggestions do you have?

Department and Job l l l l l l l l l l l l

Were the department’s objectives clear? Was the job explained properly? Were the objectives set very difficult? Did the supervisor give adequate feedback on performance? Was the support by management adequate to perform better? What improvements would the employee suggest in the supervisor’s style? Were colleagues cooperative? Who would the employee recommend as a replacement? Are there any suggestions for improvements in the systems and procedures? Were grievances addressed in time? How were the working conditions? Was their recognition for good work?

Downsizing and Layoffs Let us first understand the meaning of these two terms. Downsizing is an organisation strategy to reduce the number of employees working in the organisation. Layoff is the physical action of reducing staff. There is another term often used—rightsizing. It is a more acceptable term for downsizing for the benefit of the public. The main purpose of downsizing is to reduce the labour cost to make the organisation more effective. Downsizing may be part of a merger or acquisition where certain functions are made redundant, or when the merger or acquisition results in duplicate activities that need to be trimmed to a single one. A merger is when two organisations merge into one organisation, while an acquisition is when a financially sound organisation acquires another firm for various reasons—the biggest being when entering a new market and product line. The acquisition enables the parent organisation to procure the skills, goodwill, and customer base. The main reason for such large employee reduction is financial survival. The union has to be consulted and those retained and those laid off have to be managed. Employees who are laid off experience anger,

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cynicism, frustration, shock and insecurity followed by deep resentment of the management. Those who are retained experience shock, anger, insecurity, relief, and anxiety regarding to their new roles. Here are some ways the organisation can manage both.

Employees Retrenched l l l l l l l

Give adequate notice of downsizing for employees to seek alternate jobs. To reduce bitterness employees must be informed that it is a business necessity. Give hefty severance packages to help the employees resettle themselves. Give older employees early retirement packages with full long-term savings and benefits. Provide outplacement assistance by actively finding alternate jobs for them. Coach them to prepare their résumés and face interviews. Provide unemployment compensation (in states that have laws for unemployment compensation).

Employees Retained l l l l l l l l l l

Counsel employees to regain their commitment Retrain employees with enlarged jobs (since they have to perform the jobs now of those retrenched) Improve compensation for the enlarged jobs Announce a hiring freeze to assure employees of their surety in the organisation Cross train employees for better job flexibility Revise career plans for fast track advancement Empower employees with new skills through training Introduce merit pay and bonuses Be transparent with the new business strategy Train supervisors in coaching skills

Retirements Retirement is when an employee has reached the age limit for employment as per law and/or as per company policy. Organisations may offer early retirement with full benefits for those within five years of retirement if the employee is showing reduced physical or psychological ability. Sometimes, employees chose to retire early due to personal reasons. It could be because of health, post-retirement job opportunities that will give a longer lease to one’s career, family circumstances, post retirement commitments (building a house, re-settling in hometown, etc.). Organisations try to make the impending retirement easy for a retiring employee by adopting some of the following means: l l l l l l l l

Give longer leaves, vacations, or sabbatical in preparation for retirement Advance part of the retirement fund due, to set-up a business or build a house. Assistance through networks to find post-retirement jobs Re-employ the individual on retainership (provided his/her skills are valuable) Reducing the content of the job Provide a demotion or a lighter job assignment Hire the employee as a consultant or contractor, i.e. outsourcing his/her services Appoint a senior manager on the board as an honorary member

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l l

Counsel employees to prepare them for retirement. (Sometimes the spouse is invited for such sessions.) Using the employee for the company’s social programmes as representatives

One option that is available to the organisation is to extend the retirement age of the individual if the person is physically fit and valuable to the organisation. A retiring employee gets all the long-term benefits such as provident fund, pension, gratuity, life insurance, salary, encashment of unavailed leave, fares for the family to the hometown and in some cases, relocation expenses. The organisation must give the employee a farewell get-together where the organisation thanks the employee for his/her services. Such a gesture strengthens the relations with other employees who witness the dignity given to a departing employee. Some organisations present a souvenir as a remembrance token.

Summary Unions were formed in the early industrial age to give voice and muscle to the workers who were ignored and worked under poor working conditions. Both the unions and management were suspicious of each other and adopted a win-lose stance. Labour laws enacted slowly gave rights to the workers to prevent exploitation. Labour relations then worked within these laws, each trying to get the maximum benefit within the law. Soon managements realised that unions were an avoidable part of the industrial environment and legitimised their existence as the sole bargaining partner of the workers. Collective bargaining became an essential part of worker welfare and managements entered into long term labour contracts that worked under strict codes of conduct. In the 1930s, the management gave attention to the worker as a human being with motivation that enhanced or impeded productivity. Managements began to give attention to the welfare of the employee. One such area was the handling of personal and work-related grievances. Managements set out grievance procedures that were fair and quickly sorted out the problem before it festered into union intervention. Another area was discipline. Discipline had to be handled fairly and consistently within labour laws. Progressive managements would look at potential indiscipline with proper interventions before it reached a stage of indiscipline. It recognised that people show indiscipline because of certain environmental factors, most of which were in the management’s control. As organisation’s progressed they realised the benefit of worker participation. As a matter of fact, in the modern age of worker autonomy and accountability, the feedback of employees is vital for decision-making and strategy. The employee suggestion scheme is a wonderful precursor to full involvement of employees in all aspects of business. Exits are unfortunate. Some are unavoidable and some that are regrettable. Organisations can make use of these exits to gain useful feedback to improve themselves. All aspects of employee relations are guided by Acts and Rules that must be thoroughly understood, executed, and complied with on a regular basis.

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Key Terms Union Dissatisfier Satisfier Mediation Mediator Arbitration Strike Picketing Boycott Grievance Discipline Termination Resignation Downsizing Layoffs Retirement

A formal organisation that represent the employees’ interests to the management Factor that creates unhappiness Factor that creates motivation Process of opening communication between two parties giving recommendations to reach a settlement A neutral third party who opens channels of communication The process of bringing a third party to make a judgement of differences between two parties Stoppage of work Dissuading others from entering a premises when on strike Refusing patronage A formal personal or work related complaint Self-control A cancellation of employment initiated by the organisation A voluntary termination of employment by an employee A strategy to reduce the number of employees The physical action of reducing staff Attaining the age limit for employment either by law or company policy

Review Quiz Short Notes 1. 2. 3. 4. 5. 6.

Explain why workers join unions. What is the code of conduct for management and unions? What are the different types of bargaining? What are the issues that can be brought to the bargaining table? Describe the union’s powers in bargaining. Explain each option. What steps would you take in the case of the following personal grievances: (a) No advancement (b) Overwork (c) No recognition (Contd.)

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Review Quiz (Contd.)

7. How would you handle the following potential indiscipline: (a) Adventurism (b) Ignorance of rules (c) Rebelliousness 8. Write short notes on the following social programmes. (a) Sports (b) Counselling service (c) Life-skills programmes 9. Under what circumstances do organisations welcome or not welcome resignations?

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12 Organisation Behaviour 1. WHAT IS ORGANISATION BEHAVIOUR? Organisation Behaviour is the study of how organisations, groups, and individuals work to achieve organisational goals. It will be best understood by using the analogy of a football (soccer) club. A football club has an owner who promotes the club to attain certain goals—financial, social, and personal goals. He empowers the club with his vision, mission, objectives, and strategies to realise these goals. He also provides the organisation with an identity that has to be protected. He wants to make sure that the club is always performing well to gain a positive reputation in society. He hires a management team (coach, trainers, physiotherapist, accountant, and others) to coordinate the direction of the club. He also hires a captain and team members with the sole objective to win. Each member is a specialist (goalkeeper, full-back, mid-field, strikers) who must coordinate with others in such a manner so as to score goals. Each member must be in sync with the team purpose to succeed. When in play, everyone subordinates their personal goals to the larger purpose of the team and that is to score goals. A striker may pass the ball at the goal mouth to his compatriot who has a better chance of scoring the goal, foregoing his own glory of scoring one. All performance is governed by strict rules and regulations and team members are penalised for breaking them. Many have their own personal concerns, motivations, and competencies that have to be managed before play, to be able to get them as a cohesive force to perform and meet the goals. The owner pays everyone to accomplish their tasks and provides bonuses for exceptional performance. However, there is another important factor. The individuals and teams have to be provided with the required tools to perform. These tools may be in the form of specialist equipment, training, tactics, and skills to meet exigencies when in play, health support for physical fitness and individual counselling to bring out their best performance. An organisation is very much the same. There is an owner (or owners) who provides the organisation with the vision, mission, objectives, and strategies to attain certain organisational goals. He hires a corporate management team who will coordinate various activities through policies, procedures, and systems to enable the team to perform and attain the objectives. The corporate management team will assemble a work team (employees) who will best attain the goals of the organisation. They structure the team in such a manner in which there are those who coordinate sub-activities (management) and workers who will perform the day-to-day tasks. The organisation structure will have a General Manager (captain of the team) and a team of

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specialists (finance, operations, production, sales and marketing, etc.) who now need to work together in an organised and systematic way (systems and procedures) to attain the goals. The organisation too operates under rules (code of conduct) and procedures, and breaking them attracts penalty. While the football team is a simple work group, an organisation is more complex. It needs a structure that can respond to changes in goals dictated by market influences; it needs groups (or teams) who themselves form sub-teams that have to work cohesively, aided by systems and procedures, and collaboration. Each sub-team has its specific goals that couple with the organisation goals. Within each team, there are individuals who have their own motivations and personal aspirations that have to be understood and met so as to sub-serve the common goal. Just as the soccer team needs certain tools, so do the teams in organisations need equipment and tools to perform at their best. This is supported by technology that brings a valuable dimension to performance. Organisation behaviour, therefore, sees how best organisations can be designed to meet the goals. It studies how groups work and what needs to be done to make them a cohesive and performing team. It also recognises the individual in the teams and what needs to be done to motivate him/her. It evaluates the tools and technology required to support performance.

2. ORGANISATION DESIGN Mission Every organisation has a reason for being in business. All its managers and staff must be coordinated to fulfill this purpose. The purpose is enunciated by the owners of the business in the form of a mission statement. A mission statement is a generalised statement of the overriding purpose of the business. This leads to the strategic intent which is the desired future state or aspiration of the organisation. All stakeholders need to be clear about what they are seeking to achieve, and in broad terms, how this is expected to be achieved. The mission statement expresses the philosophy of the property. Further details on the subject may be found in “Organisation Vision, Mission, Culture, Values, Strategies, Objectives, and Structure” in Chapter 3.

Objectives and Goals From the mission statement flows the specific objectives and goals to achieve the mission. While objectives are long-term aspirations, goals are short-term aspirations. Objectives are of two types: Strategic Objectives which are long-term goals; and Tactical Objectives which are short-term goals. Objectives and goals are reflected in formal plans—how they are to be achieved (action plan); when they are to be achieved; and who is accountable to achieve it. We have seen in Chapter 3, that goals or objectives are set at the planning stage. There are Perspective Plans, Long-Term Plans, Short-Term Plans, Annual Plans, and Budgets. While the corporate management is concerned with perspective and long-term plans, the Department Heads are concerned with short-term and Annual Plans.

Organisation Structures Organisation Structures respond to the specific strategies of the organisation in a changing environment. Structures have moved from hierarchical (top down) ones that typify the industrial age to inverted pyramids that suit the service age. They have delayered organisation levels to make accountability and autonomy exist

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at the point of guest contact. Structures have to deal in the future with the knowledge worker who brings expertise to his/her profession and function. They have to be managed to give organisations greater effectiveness. Chapter 3 gives the various structures available to organisations.

3. GROUP DYNAMICS A group (team) is like the human body. Just as the body has a heart, stomach, liver, etc. each with a unique role, so a group is an assembly of specialists each with his/her unique role towards a common goal. Any component that becomes dysfunctional makes the whole body sick. If one member starts becoming dysfunctional, the whole group falls in performance. The anatomy of the group is best illustrated as follows: Interaction

Activity

Sentiment

FIGURE 12.1 | Anatomy of a Group Interaction is the behaviour between people. If the interaction is negative, the responses to work diminish. If the interaction is supportive, the behaviours at work enhance. It is like two tennis players or ballet dancers. They respond automatically in harmony without a word being spoken. Such is the level that organisations desire. Organisations want the interactions of group members to be so fine-tuned that each knows the expectations and capabilities of the other to respond in a supportive manner. Activity is the job and the several tasks that compose a group function. Teams are assembled in such a manner that each member of the team makes unique contributions to the group and the entire group depends on the individual to perform well to make the group succeed. We have learnt earlier that a soccer team is a group of specialists each contributing to the group goal in their unique manner. Sentiments are the emotional and mental processes that underlie relationships. These in modern terms are called ‘vibes’. If the vibes are positive, then the group performs well. If they are negative, then the performance falls. Sentiments are limitless, but groups adopt certain joint feelings called group norms. These norms are powerful and can enhance or destroy performance. Should group members not find these vibes within their work groups, they find it in other groups called informal groups. Informal groups are those that are created by common interests and vibes not necessarily related to work. One has to just look at an employee cafeteria where individuals always prefer to sit with informal groups. These are informal groups that are related by other interests than work. Their common interests set positive vibes and are powerful for an individual’s emotional health. Groups are systems whose parts are related and interdependent. A change in one part in the anatomy of a group means changes in other parts as they are linked together to operate as a functioning whole. Groups serve three functions for the individual:

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1. The satisfaction of complex social needs; 2. Emotional support in dealing with their environment; and 3. Assistance in meeting goals. The social needs come from the root human behaviour to interact with others. Individuals, since the human evolution, needed others for survival. The early human being formed tribes which later evolved into societies. This affiliation can either be a means to an end (survival, meeting goals, etc.), or be an end in itself (i.e. my performance is based on the people around me). The worst punishment to an individual is solitary confinement. People want companionship to deal with the world. The lack of it at the workplace results in low productivity and employee turnover, and high absenteeism. Emotional support is vital for the human being because they crave for affection. This explains why teenagers are influenced by their peers in everything they do (music, clothes, hairstyles, etc.) because they want affection and acceptance. The groups define the norms of acceptable (ethical) behaviour and those that are not approved. This form of affiliation brings social esteem, prestige, and status among group members. While organisations have their code of conduct, groups affirm them by correcting errant members. Sometimes, the group may not agree to certain organisational rules and may disobey them. They expect all their members to fall in line, otherwise they will withdraw their emotional support making the errant member an outcast. Sometimes, individuals outperform their job not because of the loyalty to the organisation, but because of their loyalty to the group. In other words, they do not want to let their ‘buddies’ down. Soldiers at war are willing to lay their lives in the cause of their buddies. Meeting goals is the prime purpose of working in groups. A group can assist in solving very specific problems and protect individuals from their mistakes. A receptionist may have a clutch of guests who arrive at the same time to be checked in. She may turn to her team members to help her out. They prefer to rely on their immediate group members than look elsewhere for help. The help is a matter of give and take.

How do Groups Decide? Any decision-making process has three conditions: 1. there are different alternative courses of action; 2. each alternative has a set of consequences; and 3. criteria are set to select the best possible alternative (Miller and Starr). Given these conditions, the process of decision-making includes the following steps: 1. Diagnosis—where problems are identified and the causes established; sets the kind of solution desired. 2. Find alternative solutions—this requires creativity and experience. 3. Analyse alternatives—where the advantages and disadvantages of each are considered and compared. 4. Decide—choose the best alternative. The above may seem easy and ideal, but this does not actually happen. There are many assumptions underlying a decision-making process: l l l

That people are aware that there is a problem That they have identified the real problem That they know the several alternatives available

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l l

That there is time to go through the decision-making process That they have chosen the best solution.

Sometimes, decisions are not made for several reasons: (a) (b) (c) (d) (e)

Managers do not have time People are scared to make decisions should it backfire on them They tend to make decisions in haste rather than going through the process They do not have enough experience to solve a problem They do not know what the problem is.

It is with these fears and shortcomings that decisions are made by groups. A workplace is known to have meetings, committees, and conferences. An average manager would spend a lot of his professional life attending meetings. Research has shown (Blau and Scott) that groups are superior to individuals on certain problems because several alternatives are generated from diverse experiences; there are checks and balances for errors by group members; and each member competes to find the best solution that is accepted. Argyle observes that collective judgement of groups is superior to the judgement made by an individual because discussion takes place; it combines the knowledge of several people; and groups are able to generate more alternatives than an individual (Maier). Another advantage of group decision-making is that groups are more willing to take risks (Clarke; Dion, Baron and Miller). However, all groups do not perform alike. Their ability to make decisions and solve problems is based on the characteristics of group members and the size of the group. Group decision-making is more effective if there is homogeneity in attitudes (Schutz). The group’s performance is stunted when members have mixed attitudes. However, it is also found that heterogeneous personalities of members enrich the quality of decisions (Hoffman). To be effective in small groups, it is preferred that one member is dominant and others average or low in their dominance (Ghiselli and Lodahl). Even in a team of two, it was preferred for one to be dominant and the other submissive (Haythorne). One thing is clear, that for a group to emerge with a quality discussion and solutions, it is imperative that each member of the group is capable and has the skill to work with others. The group does not have to be heterogeneous or homogeneous (Bither). In terms of the size of groups, research has found that larger groups (above 12 members) have the potential to generate more ideas, provided there is a mechanism to draw out members who are shy in a large group (Collins and Guetzkow); middle-sized groups (5–11 members) tend to make more accurate decisions than those outside the range (Manners); while small groups (2–5 members) tend to achieve consensus more effectively than larger groups (Manners, Hare) and have greater member satisfaction. In group decision-making, it is preferred that members sit face-to-face. A round table is best as members tend to talk face-to-face than with adjacent members. The main problem of group decision-making is the jostling for dominance. Someone with greater specialisation of the subject is bound to dominate more. Then, group cohesion is important to bring in a better spirit in the meeting. While one is outstanding in one meeting, he may be non-participative in another. Arriving at a consensus is the main challenge, especially in large groups. The objective of any meeting must be a ‘win-win’ one and a not a ‘win-lose’, one. The best way to improve group decision-making is to ensure that 1. 2. 3. 4.

contributions must be made by facts and not impressions; logic must be used rather than emotions; the decision should avoid majority vote, averages, coin flips and bargaining; and everyone is involved in the process of discussion.

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Organisation’s Role in Shaping Groups Organisations have a great role in shaping formal groups. In the organisation design, we have seen how departments are created with unique specialisations that contribute to the organisational goals. These departments are groups in themselves. Each department breaks the function into sub-groups which further break them into smaller groups. Let’s take an example (Figure 12.2) to further illustrate the point: Hotel

Food and Beverage Department

Food Service

Food Production

Bakery

Butchery

Kitchen Stewarding

Pot Washing

Dish Washing

FIGURE 12.2 | Departments of a Hotel We see in the above diagram how formal groups are formed through organisational design. While the hotel is the mega-group, it is further subdivided into departmental groups each with its unique specialisation. The departments further break their large activity into smaller specialist activities each with their specialist teams. The sub activities are further broken down into smaller work groups each with their team leaders. Each group has its own script of functioning using methods like planning, organising, controlling, and execution. These are knit together by systems and procedures, rules and regulations, code of conduct that lay the boundaries of behaviour. The work areas are fitted with the appropriate technology and tools to perform the tasks. The bakery will have industrial baking ovens and the dishwashing area, an automatic dishwasher. Each group is also influenced by certain working conditions. The bakery is hot and the dishwashing area is noisy. The employees then come into the scene as actors. Each has a part to play and collaborate with one another to meet the team goals, department goals, and organisational goals.

4. MANAGERIAL LEADERSHIP Management Role in Shaping Groups The way the management leads the workforce has a bearing on group dynamics. Management practices determine who interacts with whom. The organisation structure is the first step in defining the formal groups in the organisation. It determines the teams based on their competencies. Some leadership styles are:

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(a) The management can ‘impose’ their leadership on the group which brings in certain group dynamics where the ‘we-they’ sentiment creeps in. (b) Management can share their leadership in which case there is a joint ownership to the tasks and goals. The manager becomes part of the team. (c) There is modern style of giving groups autonomy in the way they plan and execute tasks. This brings in greater deal of self-control, motivation, and sense, of achievement. The manager sets broad guidelines and expectations within which the team can operate. While individuals bring their own status into the group based on their origins, expertise, and experience, management create status based on titles (using terms as ‘Senior’, ‘Chief’ ‘Head’, etc.), pay, mobility (areas at the workplace one is allowed to move), and physical symbols (stripes on the uniform sleeve, which cafeteria they are entitled to eat in, etc.). In carrying out their assigned duties in a group, workers interact and generate sentiments. Some are expected sentiments that go with being professional, while others are unplanned. Managers have to manage the unplanned sentiments to bring cohesion within the group. Failure to do so will force the workers to form informal groups that develop a life of their own. Informal groups are quite separate from work groups. Cohesion in work groups is encouraged through team-building exercises. The success of informal groups is their cohesion. Cohesion is the ability to be coordinated, logical, and consistent in bringing results. Cohesion aids the pursuit of group objectives and emotional health of group members. The source of cohesion in groups is:

Homogeneity This is caused by coming from the same ethnic background, having common interests, sharing the same set of values, and coming to each other’s help. A manager’s ability to build a team with such common characteristics is ideal, but a challenge. Competitive spirit hinders cohesion unless the management remove those rewards that create the competition. There is a lot of merit in awarding group rewards than individual rewards to foster cohesion. Group cohesion can also form when there is a stable team. Constant changing of members does not foster cohesion.

Communication Communication with one another fosters cohesion. If people are unable to express themselves and negotiate their expectations, cohesion will be difficult. The Kitchens, Stewarding, or Laundry have problems communicating within the department due to a noisy environment. Language is very important to establish communication. Multi-cultural workforces have a difficulty in establishing easy communication.

Isolation Isolation prevents group cohesion. Some jobs tend to isolate people. Positions such as gardeners and public area cleaners have a problem of communication because they are dispersed to remote corners of the property. A counter salesperson at the in-house delicatessen may have difficulty in finding cohesion with a group. It is important for group dynamics to develop mechanisms for those in isolated jobs to interact with other group members frequently. Job rotation is a wonderful method, just as much as daily briefings. Large organisations even provide walkie-talkies to establish communication.

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Size Size of the group influences group cohesion. Larger the group, the more difficult it is to bring in cohesion. Larger groups will invariably splinter into smaller informal cliques. The smaller the group, the better is the cohesion. People are able to communicate easily. The management, therefore, breaks larger groups (like departments) into smaller groups with similar objectives and skills (sections within a department).

External Pressure We all know that groups drop all differences and create temporary cohesion when there is a threat or pressure from the outside. Continuous pressure creates permanent high cohesion. Management can create such pressure by focussing on an external competitor. They also can apply pressures of deadlines, customer service, bottom line results, and quality. This stress works in creating cohesion in groups. Under pressure, groups tend to decrease vertical communication and increase horizontal communication among peers. They need to coordinate closely to meet goals.

Status Status of the group also has an influence on cohesion. The higher the status of the group, the greater is the cohesion. A group gets a status when it has constantly shown excellence, has a monopoly on certain practices, autonomy, opportunities for promotion, working conditions, and location of activity. The Finance function always enjoys status because they sit on the same floor as the General Manager! A functional and healthy group is ultimately dependent on the kind of leadership they receive. We shall look at what makes a good leader.

What Makes a Good Leader? The much used term “a born leader” comes from the pre-industrial age of kings when leadership roles were hereditary. A prince was born into a leadership role whether he was intrinsically a leader or not. This led people of the day to list traits that suited a king and the princes were cajoled or beaten into those traits. A leader, therefore, had to show traits as self-disciplined, commander, decision-maker, good communicator, etc. These were the thumb rules for good rulers. As situations changed, social scientists found it difficult to reach agreements on a common set of leadership traits that suited all situations in an organisation. This led to an approach of defining styles. The styles were based on who made decisions. From this emerged the following styles:

Leadership Styles Autocratic Style Dictatorial Style Persuasive Style Democratic Style Authoritarian Style Bureaucratic Style Charismatic Style Delegative Style

Leader asks others, but makes the final decision Leader makes all decisions Leader sells ideas of decisions already made Leader involves all and goes by the majority vote Leader defines scope of authority and monitors it Leader makes decisions by the rule book Leader is allowed to make decisions by his sheer personality Leader gives broad parameters within which people make their own decisions.

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The style approach believed that leaders could effectively control the behaviour of their subordinates. They adopted a style that they were most comfortable with based on their own personality. There has been no consensus as to which style is the best. In fact, later studies showed that certain styles can be the best in certain situations. For example, a dictatorial style would fit in well in a fire emergency, while communicating a change in policy will require a persuasive style. There is no leadership style that is a success in all situations. Situations, therefore, dictate the best style for the occasion.

Theory X and Theory Y It was well into the industrial revolution that organisations started thinking about leadership and motivation when they got concerned about productivity to produce as many goods as possible in a shift. They turned their attention to social scientists for help. One of the forerunners of those times was Douglas McGregor of the Massachusetts Institute of Technology who discovered that managers tended to create situations at the workplace that they are most comfortable with. He detected two distinct leadership styles which he termed Theory X style and Theory Y style. His study found that the attitude of the leader was crucial to success of the group they led and their productivity. Theory X leaders believed that (a) people do not like to work; (a) they have to be cajoled to work; and (c) they rather be told than to think for themselves. In other words, the leaders were dictatorial and authoritarian. This style was fine when the workforce was illiterate. This is a rather archaic style of leadership of the agrarian society that outlived its time as workers became educated and intelligent. The other end of the pendulum was the Theory Y leader who believed: (a) People do not like or dislike work but develop an attitude towards work based on experiences. (b) While authoritarian methods get things done, they have severe sideeffects. (c) There are other kinds of styles to employ where people set goals for themselves if they see some possibility of a reward, either material or psychological. (d) If people are given the right circumstances they do not shun responsibility. While Theory Y did not achieve dramatic results and transformation as Theory X did, the people were more psychologically secure and work went on even in the absence of the leader. Theory Y was a great step in thinking, perfected over years and certainly adopted in modern times.

Robert Tannenbaum and Warren H. Schmidt These scientists believed that leadership was not a bi-polar phenomenon like Theory X and Theory Y. Instead, leadership was a composite of styles that spanned over a uni-dimensional continuum. Leaders used these styles based on their circumstances (Figure 12.3). The continuum ranges from what they termed as “Boss-Centred Styles” to “Subordinate-Centred Styles.” They believed that somewhere in between was the best style to adopt. They also postulated that leaders could base their style on the circumstances they found themselves in. These circumstances were influenced by the forces in the manager; the forces in the subordinates; and the forces in the situation.

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Use of authority by the manager Area of freedom for subordinates

Manager makes decision and announces it

Manager sells decisions

Manager presents ideas and invites questions

Manager presents tentative decision subject to change

Manager presents problem, gets suggestions, makes decisions

Manager defines limits, asks group to make decisions

Manager permits subordinates to function within limits defined by superiors

FIGURE 12.3 | Uni-Dimensional Continuum Forces in the Manager include: l l

His value systems His own leadership inclinations

l l

His confidence in the subordinates His insecurity in unfamiliar situations

Forces in the Subordinates include: l l l l l

Their expectations from the manager Readiness to assume responsibility Ownership of a problem Identity with the goals of the organisation Willingness to share decision-making

l l

l

The amount of direction they desire Tolerance for ambiguity. (Some people prefer clear cut directions) Knowledge and experience to deal with problems

Forces in the Situation include: l l l

Culture and values of the organisation. Some like their managers to make all decisions. Effectiveness of the group. Whether they have the collective experience working together. Type of problem—whether general or specialist in nature.

In modern times, changes are a way of life. This leadership style takes into account the following issues: l l l l l

How ready are the employees to accept change? How much motivation is required to change? How much gap is there in employees to make quality decisions? How to develop teamwork after change? What further individual development is required for change?

Managerial Grid Blake and Mouton made another great leap in leadership study. They were able to define leadership on a bi-dimensional grid that had 81 situations (Figure 12.4). In this grid leadership style is based on two factors—task and people.

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1.9 People High, Task Low

5.5 People Medium, Task Medium

People

Low

9.9 People High, Task High

1.1 People Low, Task Low

Low

9.1 People Low, Task High

Task

High

FIGURE 12.4 | Managerial Grid

People Low, Task High (9.1) Here, the leader gives task the highest importance at the cost of people considerations. Team leaders prioritise work and determine outputs desired. They are comfortable with systems and rules and can set high standards. They lead with close supervision. The people are likely to be low on commitment. They will work steadily when the leader is present, but will slacken when the leader is absent. This is much the Theory X leader or the Dictatorial Style. At a positive level, this may be appropriate to crisis situations where the best shall command and people feel secure.

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People High, Task Low (1.9) This is more like a country club where the leader gives concern to people issues and sacrifices the task. Such leadership style is bound to fail because the tasks and objectives are not achieved. People can take advantage of the leader. The leader uses the Persuasive Style to get things done. At a positive level, a leader may think that his people are capable to accomplish the task, and therefore, leaves them alone to achieve results. He instead concentrates on encouraging them towards better results.

People Low, Task Low (1.1) In a worst scenario, this shows an impoverished situation where the leader abdicates his responsibility to people or the task. The leader is concerned with maintaining his leadership position and concentrates on external powers that can make this happen. The organisation is bound to decay and die. At a positive level, the leader is so confident that his team is mature and capable to achieve results on their own that he delegates the internal running of operations to it. Today’s autonomous groups comprising experts and specialists could well thrive in this approach because they form the directions towards success. The leader adopts a Delegative Style or even the Laissez Faire style where employees are given total freedom.

Moderate People, Moderate Task (5.5) This is the middle of the road where people and tasks are moderately balanced, but not enough to bring outstanding results. Such leaders will get average performance only. A positive way of looking at it is that a leader may adopt this style when he is new to the organisation and needs time to understand the task requirements and people.

People High, Task High (9.9) High priority is given to both people and task. The leader takes a participative approach through which he achieves high performance. The people are highly motivated and conflicts are low. Quality of work is good and both employee and customer satisfaction is achieved. This is claimed to be the ideal situation in which both the organisation and the people prosper. This could be the Democratic Style.

Situational Approach Kieth Blanchard brought in another revolutionary study where he narrowed the 81 situations in the managerial grid to only four situations that leaders need to worry about. The situations are caused by what he called the maturity of the team or individual. Maturity was defined as ability (competence) and willingness (motivation). He worked on the bi-dimensional grid (Figure 12.5) and proposed four styles.

Directive Style Is when the leader makes decisions with little input from employees who merely act on instructions. This style is used in situations where work is done by beginners like apprentices and trainees who are unable to do a job and unwilling to perform them because of their nervousness. This style can also apply to illiterate or semi-literate workers. They need close supervision and guidance.

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High

Delegative Style

Persuasive Style

High Ability High Willingness

Low Ability High Willingness

Consultative Style

Directive Style

High Ability Low Willingness

Low Ability Low Willingness

Willingness

Low

High

Ability

Low

FIGURE 12.5 | Styles

Persuasive Style Is when the leader makes the decisions, but encourages the individual or team. The employees have low ability at this stage, but are willing to perform tasks as the leader encourages them. The leader sets higher standards and gives the individual or team the confidence to perform.

Consultative Style Is when the individual or team is high in competence but unwilling. These are mature experienced individuals and groups who may not have the managerial qualities to reach leadership positions but have sound experience. They are normally old timers. The leader would take them into confidence and consult with them on how to proceed in a situation. Their willingness to help improve situations arises because they are made part of the decision making process.

Delegative Style Is when the individual or team has high competence and are also well motivated. They can be left to perform without supervision. These employees need broad directions and are empowered with authority to make decisions. They are also given deadlines and milestones when work is reviewed.

Theories Put into Action What do all these studies mean to the Manager? How can he/she interpret them into an effective leadership approach? 1. The manager must examine her assumptions about people and how to lead them. He/She needs to identify his/her own leadership style through reliable psychometric tests available as also from plain feedback from those he/she leads. He/She will need to work on weak areas while emphasising his/her strong ones. 2. He/She must balance both, concern for tasks and objectives, with concern for people. 3. He/She must know his/her team well. This he/she does by spending time with individuals on a oneto-one basis to understand their abilities and motivation. He/She must know individual levels of competence and draw on each team member’s strengths, while having action plans of development to overcome their weaknesses.

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4. He/She must assess situations and people that require the four styles—directive, persuasive, delegative, and consultative. For this, he/she must develop these styles effectively and know the attitude and language to be followed in each style. 5. He/She must communicate the departmental objectives on a long- and short-term basis so that employees know the direction in which they are going. In other words, there must be transparency of the goals of the organisation, department, and their immediate workplaces. 6. Employees require feedback on how they are doing. People like to know where they stand. The manager must institute a fair evaluation system that is designed to improve performance and willingness and not destroy them. Feedback on performance is given daily in briefings as also in the periodic appraisal. 7. People like to see their leader as a coach and mentor and be approachable to resolve conflicts, grievances, and doubts. The leader should be personally responsible for the growth of the individual and team by introducing training as a way of life. This can be achieved when there is a degree of trust achieved through transparency and candour. 8. The manager must build self-confidence in his/her teams with the objective of making them self-reliant. 9. The manager must be part of the team and be humble enough to learn from his/her subordinates, some of whom may be older and more experienced than him/her. 10. Celebration and rewards are equally important as work and toil. The manager must be free to give recognition. Recognition motivates.

5. INDIVIDUAL MOTIVATION What is Motivation? Motivation comes from the word motive. A motive is an inner drive to achieve an objective. Motivation is, therefore, the process of releasing the inner drive to achieve an objective. Motivation has to be generated from within an individual. Readers must keep this in focus when considering this subject. To be able to understand the subject of motivation, it is important to learn the different work conditions that existed over the years and the subsequent motivational studies that were undertaken as work practices evolved.

Pre-Industrial Revolution Motivation in pre-industrial revolution times was based on the fact that the general workers were illiterate, and therefore, preferred to be told what to do, rather than think for themselves. Education was the privilege of the nobility and a select few in those days. Business was run by a collection of artisans in villages and towns and was known as the cottage industry. Owners of small businesses then motivated people by the “carrot and stick” method. Fredrick Herzberg later called both as KITAs (kick in the a…) as both were externally influenced. He called punitive methods (stick) as negative KITAs, while incentives (carrot) as positive KITAs. Owners before the industrial revolution kept their trade within the family. Though they used “carrot and stick” methods, they also provided concern and care for their kith and kin. The style of management was benevolent dictatorship. The head of the small business was the shaper as well as the provider of careers. This created great loyalty among

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the workers who were carefully chosen, mostly based on relationships. This care was a great motivator as it provided emotional security.

Industrial Revolution These conditions existed for centuries till the industrial revolution in the 18th century. Machines changed the criterion for hire from relationships (of the paternalistic owner) to competence. The person hired in the industrial age had to come with knowledge and skills and the competence to handle machines. The work force then consisted of people of varied socioeconomic backgrounds. Mass production by conveyor belt had only one mantra—productivity. The more they produced the better was the business health. Management adopted the age old “carrot and stick” method without the paternalistic care. This resulted in excessive labour turnover due to low self-esteem, work monotony, and fatigue; workers sank into depression and they lost tempers quickly and resigned impulsively. This was a serious problem for factory owners who wanted productivity at all costs.

Hawthorne Studies The quest for productivity led owners to academics for help when all their attempts failed. As late as 1927 AD, Hawthorne Works of Western Electric Company in Chicago hired Elton Mayo of Harvard Business School to provide a solution to a very demoralised work force. Mayo created an informal test group from the larger workforce as a means of comparing their performance with the rest. The test group were subjected to various working conditions from the good to the bad. These conditions included lighting, tea-breaks, noise, temperature, etc. In spite of different conditions, this test group displayed incredible productivity. The working conditions did not seem to matter. He then made a startling discovery—informal groups. Workers formed informal groups to fill a void in their lives (alienation) and this void resulted from a basic need for cooperation and comradeship which modern industrial organisations had ignored. Further, these informal groups could exert a far stronger pull on the worker’s motivation than the combined strength of management, money, discipline, and even job security itself. The test group chosen by Mayo was an informal group who decided amongst themselves to break all production records to show what a little attention from management could do! They were getting attention from the management for the first time, through this study. By singling the test group, Mayo gave these workers an “elite” feeling and attention, to which they were willing to give themselves wholeheartedly. Mayo shifted his attention away from workers to the managers and supervisors. He found the secret to success lay there. Mayo told managers to improve communications with the workers so that they would have a sympathetic insight into the minds of its workers, and to put supervision into the hands of men to whom a respect for their fellowmen came naturally. Alienation was a demon in the industrialised world and people needed the touch of humanness in this mechanistic environment. Managers and supervisors were to be trained in the skills of listening, understanding, and eliciting cooperation—quite a departure from the classical image of an iron boss. He also found that workers liked to participate in managing their own work which informal groups provided. This reinforced that motivation came from within and not externally. The concept of team spirit grew from here.

Michigan Studies In 1942, two social scientists Rensis Likert and Daniel Katz launched a sophisticated research better known as the Michigan Studies. They wanted to know the secret of high performing groups and low performing

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groups. They found the target groups who were clerical workers at the Prudential Insurance Company of America in Newark, New Jersey, where there were distinctly two groups—high performing and low performing. They concentrated on the behaviour and attitudes of frontline supervisors. They discovered that supervisors that led high performing groups were characterised as “employee centred” and those leading low performing groups were “production centred” (or task centred). The Production Centred supervisor considered that his main job was to get the work done and looked at his people as pure instruments. He interfered with all decisions and provided close supervision. The study showed that the emphasis on productivity at the expense of workers’ dignity was self-defeating. The production centred supervisor was defensive, authoritarian, and arbitrary. Employee Centred supervisors were task oriented too, but gave more importance to the workers. Their supervisory tactic was to give their people a general outline of how the work was to be accomplished leaving the details up to the workers themselves. They assumed that their people were responsible enough and capable to get things done without someone peering over their shoulders. The employees were in control. The Employee Centred supervisors were cooperative, democratic, and amenable to reason.

Theory of Needs Abraham Maslow, a social scientist, brought the concept of human needs that changed the concept of motivation most dramatically by claiming that: 1. 2. 3. 4.

All humans have needs. These needs can be collated into five broad categories. The categories have an ascending hierarchical order. That one must be satisfied to move to the other. (Later scientists proved that all needs can co-exist together in varying levels of importance to every individual).

Needs are essential to human well being. These could include those that are essential to human survival such as food, water, clothing, and shelter at the basic level, to those that are essential for social survival like belonging and status. This has been illustrated in the famous Maslow’s Need Hierarchy as shown below (Figure 12.6).

Self Actualisation Status Self-Esteem Belonging Security Physical Emotional

Physiological Needs

FIGURE 12.6 | Maslow’s Need Hierarchy

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The needs start from the bottom and we shall examine how they impact human beings.

Physiological Needs These are the basic needs for survival such as food, water, clothing, shelter, air, and sex (for procreation of the human species). The hotel industry recognises these needs and meets them by providing free duty meals that satisfies the need for food; uniforms that satisfied the clothing needs; housing allowance for housing that satisfies the need for shelter; potable water in staff cafeterias; fresh air through climate control mechanisms; etc. For example, the kitchens and laundry which are very humid and hot, especially in hot climates are provided with proper exhausts and fresh air supply. Hotels give a salary to start and maintain a family.

Security Needs When survival is no longer an ever present danger, there is a tendency to become more concerned with preserving this good fortune. Employees want to be secure in their jobs to provide constantly for their physiological needs. The security need is both physical and emotional. The employees want to be sure that the Hotel they are working in is physically safe from anything that may endanger the body. Hotels provide locks, fire warning systems, sprinklers, fire-fighting equipment, etc. to satisfy this need of physical safety. Employees want to be warned of wet floors and the name of callers before responding to a telephone. A well trained security staff protects the safety of guests and employees. There is another security need—emotional security. A worker’s need for emotional security comes in many ways. First is the need to be welcomed into the organisation and inducted well when they join; they want to know what is expected of them through job descriptions; they want to be treated with courtesy and respect; the property provides safe working conditions and gives safety training, especially in the use of equipment and carrying heavy loads; grievance procedures; performance evaluation to inform them how they are doing; and an opportunity to grow and improve their lot. These are all organisational processes meant to give the employees emotional security.

Belonging Human beings are social animals. They prosper and grow when interacting with others. This behavior was noticed right from the early cavemen who lived together to form tribes. We have seen in the Hawthorne studies that in the absence of attention leading to loneliness (alienation), people formed informal groups to provide that sense of belonging. Membership to a group was a powerful motivator. Hotels realise this powerful motivator—employees are given identity cards to identify them with the organisation. Establishments provide social clubs and take welfare measures where employees can meet for sport or social meetings.

Status and Self-Esteem While status is the way others perceive us, self-esteem is the way we perceive ourselves. Employees within the industry are given ranks, perquisites, and uniforms to distinguish them within and without the organisation. They get a status in society. Hotels do have a hierarchy that sets a chain of command. People can aspire for higher positions in the organisation to improve their status. Self-Esteem is a bit tricky. The first step towards it is to give employees respect and dignity. Self-esteem is also given by bestowing authority and empowering employees. Suggestion Schemes also permit employees to participate in the progress of the organisation by acting on their views and ideas.

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Self Actualisation This is a state when human beings reach their potential and are able to control and contribute to the environment. This is the main motivator of the modern age. Hotels provide the conditions for people to attain their full potential through delegation; training and development; accountability; job rotation; challenging tasks, etc. Employees want to feel that they have a say in the prosperity of the organisation. Personal growth by attaining mastery over one’s environment is potentially the most powerful motivator of all because, unlike other motivators, it can never be satiated.

Pittsburgh Studies One of the most sophisticated studies on work motivation came from Fredrick Herzberg and his colleagues at the Psychological Service of Pittsburgh. It is for this reason the study is called Pittsburgh Studies. They studied a more sophisticated group of 200 engineers and accountants. The employees were asked to recall specific incidents in their recent experience which made them feel either good or bad. Herzberg found that good feelings were felt in the nature of work that they performed, rather than background factors like money, security, or working conditions. This led the researchers to classify those that they called ‘Motivators’ and those that they called ‘Hygiene factors’ (hygiene here does not mean cleanliness, but good emotional health). Motivators had an uplifting effect on attitudes or performance whereas Hygiene factors provided no improvements, but prevented loss of morale and efficiency. They met the lower order of Maslow’s theory of needs such as physiological and Security needs which were necessary to survive and be ready for higher order of needs. The hygiene factors were things like pay, security, working conditions, and supervisory style. These were dissatisfiers. When they were inadequate, they had a significant negative effect on worker attitudes, but they had no important positive effect when they were properly administered. This showed that these factors, especially pay, did not motivate but was a means to higher needs. Motivators were satisfiers that left an uplifting impact such as recognition, growth, achievement, and challenge in the job. For this cadre of professionals, sustained motivation lay in assignments that pushed their capabilities to their limits. It made a person feel responsible and worthwhile. This required the leader to provide support to subordinates so that they might satisfy social friendship, accomplishment, and self-esteem.

Competence, Affiliation, and Achievement Motives Robert W. White of Harvard University discovered in his research of work motivation that the individual is more than just a vehicle for a set of instincts; he is also an active observer and shaper of his environment. In the broadest sense, people like to be able to make things happen—to create events rather than merely await them passively. White called this desire for mastery “the competence motive.” In adults, the competence motive is very likely to express itself as a desire for job mastery and professional growth. A man who trusts his own ability to influence his environment will actually try to influence it more often and more boldly than someone who is inclined to let the environment influence him. Stanley Schachter of the University of Minnesota discovered that people need other people’s company and that some like it more than others. This need for socialising was “the affiliation motive.” He confirmed

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Mayo’s theory that people formed informal groups in an impersonal work environment. He went further, that people sought the company of others for what they gave them as also for the sheer pleasure of it. Those that believe in similar interests will seek each other out with urgency. They go through an excited process of comparing notes, speculating about the event, and seeking explanations. They get relief in exchanging notes. Misery certainly does love company. The informal group was an antidote for dull working environments and oppressive bosses. Groups provide pride, importance, and security to the individual. David C. McClelland from Harvard University led a group of psychologists on a research and discovered “the achievement motive.” They found that the achievement motive played a very vigorous role in the lives of people. This motive makes accomplishment an end in itself. People with this motive enjoy winning, in competing successfully with a difficult standard; this means more than money or recognition. The higher this motivation was in people, the higher was their rise in positions of greater power and responsibility. They were willing to take risks and wanted feedback that was prompt, precise and unmistakable; they committed themselves emotionally to accomplishing tasks.

Expectancy Theory Expectancy theory believes that individuals must satisfy their personal needs while meeting exigencies of work (external outcomes) to a job situation. It states that people will behave in a manner that fits their personality (needs, abilities, aspirations) to satisfy the requirements of the situation. In addition, the expectancy theory believes that people are emotional (seeking satisfaction of needs) and reasonable (thinking through what alternatives will satisfy those needs). He predicts outcomes of situations. These predictions are called expectancies. An individual sets probabilities for an outcome and chooses those actions that will most likely satisfy his/her needs. Managers have to understand the needs of each individual to understand why they behave in certain ways in different situations.

Future Approaches The frontiers of human productivity already lie beyond decent supervisory relationships. The tightly controlled organisation is obsolete. Management will move toward greater flexibility and individual responsibility because these are more efficient principles of organisation than the traditional chain of command. Organisations will believe in decentralisation, autonomy, delegation, and human development. Normal decision-making functions will be automated and will most probably replace middle management. People will have greater information to make better decisions so that younger generations will hold positions far greater than their forefathers at that age. Organisations will find ways to make good employees permanent stakeholders in the company by giving them a share of profits in addition to pay. Jack Welsh, a modern guru, the CEO who turned around General Motors into a winning organisation recommends the following: l l l

Human resource management must build leaders and careers. Introduce a non-bureaucratic evaluation system. Identify with unions and star performers.

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l

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Use the 20-70-10 principle in which 20 per cent of the workers are stars that drive the organisation. 70 per cent are the work horses who provide continuity to the organisation and are the heart and soul of the organisation. 10 per cent are “sliders” and “disrupters” who are losing motivation and those who downright bring down the organisation because of their incompetence. Keep the organisation as flat as possible with clear reporting relationships and responsibilities.

Converting Studies into a Motivational Strategy 1. The manager must evaluate and restructure, if necessary, ones own attitude towards people first. There are valuable psychometric tests, the most modern being the Circumplex that identifies one’s leadership style. The manager must perceive those working under him as human beings with feelings and It’s not what you push.... It’s what pushes you.... needs. He/She must understand those needs in order to motivate. People are not automatons within complex work machinery. They have a say in how work is to be conducted. (Michigan Studies—Employee Centred) 2. Know your people well and give them personal attention. The absence of a high touch will only alienate them and they will only run to informal groups which may or may not be productive. (Hawthorne Studies; Affiliation Motive) 3. Provide excitement in the job by job enrichment, job rotation, and job enlargement. (Herzberg’s Motivator—Challenge in Job; Achievement Motive). 4. One of the greatest needs of today’s worker is to have a feeling that he is in control of his environment and not vice versa. The manager should delegate responsibility and give limited authority for the employee to execute his or her job. Once he is ready to assume this, he can be accountable for his job. Set targets and standards and let the employee have ownership of his area. For example, there will soon be no floor supervisor, but superior room attendants or teams who “own” the floor or set of rooms. Very often, supervisors assume all responsibility and authority for fear of losing control at the workplace. This is a misnomer. Accountability gives the worker a purpose in life and the need to do his job well. It also releases the manager to do other more important things. (Competence Motive; Self-Actualisation). 5. Chalk out common objectives with the employee and agree on norms to achieve them. This gives workers a security as to what is expected of him/her her. When he has met his objectives, he certainly has a feeling of achievement. This feeling of achievement is the greatest motivator. (EmployeeCentred Supervisor; Emotional Security). 6. Recognise good work done. This should not be a precondition of performance, otherwise it lapses into positive KITAs. Recognise in public and institute such programmes as “Best Employee of the Month”. (Pittsburgh Motivator of Recognition; Maslow’s Self-esteem) 7. Make training and development an important part of organisational life. Individuals must be nurtured to achieve their own potential and a mastery over their given field. (Growth as a Powerful Motivator— Pittsburgh Studies) 8. Follow the 20-70-20 principle. Empower those 20 per cent who drive the department. Delegate responsibilities and develop them into leaders. Do not take the 70 per cent for granted, but respect and recognise them for keeping the wheels of the department/organisation turning. The “sliders” must be helped to reach their peak potential with personalised action plans such as training, job enrichment, and job rotation. Get rid of “disrupters”!

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6. CONFLICT MANAGEMENT Walton and McKersie defined conflict as “a deliberate interaction of two or more complex social units which are attempting to define or redefine the terms of their interdependence.” To put it simply, conflict is a disagreement of two or more parties who have separate goals where gains of one is at the expense of the other. It stems from the free will of people to exercise control over their environment. However, there is increasing belief that conflict is good in some circumstances when rational people assert themselves in what they believe. Therefore, no conflict leads to stagnancy, while too much leads to chaos. Research shows that managers spend 20 per cent of their time in managing conflict, and positive conflict will only grow as people become more knowledgeable. Why do people create conflict? There are two reasons for this; (a) when people have incompatible goals; and (b) when they have to share scarce resources. Figure 12.7 below explains this concept: High Conflict

High

Goal Incompatibility

Low

Low Conflict

Interdependence

Resources Shared

High

FIGURE 12.7 | Conflict Management Let us take an example. The kitchen and the front office of a hotel have little in common in day-to-day interaction. Therefore, the chances of conflict are less because their interdependence is low. Their goals are different and they do not need to interact with each other. On the other hand, the kitchen and the restaurant may have conflict because of differing goals. The waiter may want to give food on time to a guest while the cook may be concerned with preparing a fine dish rather than be concerned with time. This could result in a conflict. Within each department, there is high compatibility in terms of what they have to achieve, so the chances of conflict are low. However, since members within the department share resources, there is a potential for conflict, especially when the resources are scarce. If cooks have to share limited stoves then there could be flashpoints. Similarly, if a number of front-office personnel have to share one computer we can expect trouble. Needless to say, if both the departments have to share a common resource like the hotel’s financial budget, then the department heads are bound to get into a conflict to get as much out of financial kitty as is available. While this concept is a backdrop to all conflicts, there are different forms of conflicts.

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Forms of Conflict Individual versus Individual We witness conflicts almost everyday between two individuals, e.g. two managers competing over a promotion, two men vying for the same woman, two executives fighting for the same office space, etc. We see that they are competing for a scarce resource by symbolically eliminating the rival. Scarce resources can be material objects or a nonmaterial state (e.g. status, prestige, power, fame, etc.). It is also interesting to note that there are some people who thrive on conflict. These are power motivated individuals who need to test their ‘strength’ periodically to assess their powers. They deliberately create conflict and enjoy the challenge of conflict. Conflict is satisfying in itself.

Individual versus Group In a work context, this can happen in a group which operates on strict informal norms. Membership and acceptance by the group comes from each individual’s conformity to group norms. Norms are informal codes of behaviour set by a group. So if a group decides that no employee will outshine the other, it becomes a particular flashpoint for an individual who is capable and wants to do better. The individual wants to promote his or her own self-interest at the stake of other group members to get recognition, better pay, or even a promotion. The group will immediately treat the individual as an outcast and give little cooperation.

Group versus Group This kind of conflict manifests itself in inter-departmental conflict, union versus management, hotel against another competitor, etc. At a macro level, it could be two political parties, two nations resulting in war, etc. A great area of conflict is status within the organisation. Each department believes they are more important than the other and vie for influence on the powers that influence the organisation (Chairman, Board of Directors, Owner, etc.). One great reason for inter-group conflict is when they are not interdependent on each other. Interdependence brings mutual trust, respect, and willingness to make the relationship succeed because both suffer. With this lack of interdependence, groups tend to protect their own territory and develop influential ‘empires’. The only way to bring groups together is to provide them common goals and make them dependant on each other to achieve those common goals. For this to happen, both groups must be stable in their internal relationships, share the same values and goals of the other group; and be clear on the boundaries within which each should work including their authority and level of interaction. The main challenge in bringing inter-group harmony is to integrate their diversity. Values may vary with each department. For example, the sales department may want excellent customer service; food production may want predictability of business; engineering may want proper use of equipment; while finance may look at profit margin. One way perhaps is to make them jointly responsible for attaining revenue targets of the hotel. The Front Office, Housekeeping, and Engineering have to cooperate to have rooms available for sale. Similarly, the Food Production, F&B Service, Kitchen Stewarding have to cooperate with each other to provide the perfect meal food service. Each set of departments has to depend on the other to generate revenues. Organisations also employ extensive team building programmes because inter-group harmony is vital for the success of the organisation.

Competition Conflict and competition are similar as both have incompatible goals and one has to succeed at the expense of the other. Competition is healthy (like in sports) bringing out the best in individual and group capabilities. However, if competition is not handled well it can turn ugly with sabotage and efforts gaining success through

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unfair means. Hospitality organisations compete with each other which is healthy. Here, the organisation brings out the best innovation, individual competencies, and group performance to achieve success. The competitor becomes the external super-ordinate goal that brings all internal parties together to outperform the external competitor.

Anatomy of a Conflict Let us look at the symptoms and characteristics of a conflict. A manager should be able to recognise them to find ways to resolve them. Here are some of the traits of a conflict with regard to the individual: l l l l l l l l l l l l l l l l l l l l l l l l l l l l l l

People have differences and exaggerate them Decrease in communication between the parties Quarrelsome Distrusting Tendency to listen to only what matters to them when they communicate Fierce loyalty to the group to which they belong, to the point of being unreasonable Feigning to understand the other parties’ points of view with overtures of concern when there are none Blind to the areas of mutual interest A feeling of being superior to the rest Overlooking the faults of fellow group members and justifying their behaviour Adopting a ‘Win-Lose’ attitude Celebrating the failures of the other party Blaming the other party Distorted perceptions to justify hostility Being stubborn in their stances Being hyper-sensitive to the words and actions of the other party Blowing perceived negative actions out of proportion Constant ‘sniping’ and verbal exchanges Refusal to cooperate Sabotaging the other’s success Tale-tattling to higher authorities Finding ways to bring the other party down in public (and higher authority) Suspicious of the other parties’ gestures of reconciliation Snooping into the other parties’ affairs to find an area of shame Influencing other individuals and groups against the warring party Soliciting alliances and support of other groups Look for opportunities to display muscle Look for champions of their cause (e.g. unions) Insisting on third party presence (witness) when communicating with other party Communicating with insinuations

Conflict Resolution Conflicts are inevitable when people work together. Differences occur as long as there are free thinking minds. However, conflicts are a source of organisation stress. Organisations may like to retain some conflict as long it is manageable and constructive. Conflicts of opinions are good to see ‘the other side’ before making

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decisions. Such conflicts come from mature and rational people who make the difference between assertiveness and aggression. Assertiveness is when people uphold what they believe in as true and the belief is backed by facts and experience rather than with impressions. Aggressiveness is when people attack personalities to shame and disrespect, and humiliate the other party. Aggression is ugly and leads to chaotic confrontation. Managers would like to retain assertiveness and dispel aggressiveness. A manager should be able to make the distinction when managing conflict. But there are other methods to resolve conflict.

Dominance Dominance is the use of status, power, authority and resources to overcome conflict. Most conflicts emerge as win-lose rivalries where one party must succeed and the other must surrender. Dominance is an effective method and may be exercised by individuals, coalitions or majorities.

Individual Dominance Traditionally, individuals displayed their dominance through physical strength. Humans fought for territory, mates, and influence by literally vanquishing the enemy with bloody consequences and often with hurt to the self. Such attitudes may have carried into the organisations where the opponent was to be dismissed or forced to resign. However, over the years the physical manifestation of a conflict changed to more subtle forms of victory over the other. It could be in the form of losing face, withdrawal from engagement, or transfer of hostilities to lesser strong parties. In organisations, managers are given authority (or position power). By virtue of this authority, they can exercise dominance over conflicting individuals or groups. The use of positive authority results in people disengaging in conflict, reinforcing them to see the larger picture, i.e. the organisation’s success, or mediating and giving superior decisions over the issues of conflicts. The use of negative authority results in conflicts not being resolved (therefore, festering for another conflagration elsewhere) and people being humiliated. But individual dominance using organisational authority is a good way to resolve conflicts. Coalition Dominance Coalition is a temporary alliance. This form of dominance is when people seek the support of others with power and influence to get benefit. The best coalition is with superiors who have power and authority. If an employee is able to win the support of the superior by being the plain ‘yes man,’ he/she is likely to have the superior intervene in conflict situations. It may mean that the manager gets involved in conflict situations, but a manager’s role is to resolve conflicts anyway. Here, the individual is countering the tactics of the rival by use of power from another source. Sometimes, smaller groups join larger, more influential groups, to get ‘protection.’ In such a case, the smaller group will have to lose its identity under the shadow of the larger group. Majority Dominance This is used when people use the support of others to outnumber and outwit the rival party. The minority is expected to withdraw and keep quiet when confronted with majority consensus. People support a group when they see a superordinate goal that benefits them. One great benefit is the support of the group whom they are allied with when tackling their own conflict agendas. The same holds true with individuals within a group. Usually, a group will try to seek unanimity through an informal poll. If there is no consensus, some members of the group are open and listen to dominant individual(s) or a coalition within the group. Members of the group will evaluate the status of the individual outside the group. After the differing parties have stated their points of view, they may go for a majority vote to settle the conflict.

Appeal to Hierarchy Humankind has found another method to seek conflict resolution—the appeal to someone superior. Even here, there are a few nuances:

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Appeal to God Human beings simply pray for divine intervention to resolve conflicts. They wait for signs and omens to give them direction. Others consult seers who use magical powers to guide people in conflict. This is when humans are helpless and do not have enough knowledge to decide their fate. Humans have to possess tremendous faith to follow divine signs. Most conflicts in medieval times were resolved by this method. Appeal to Higher Positions As humans gained knowledge, they looked for justice through rational processes. Thus, society created the judge. In simple tribes, the judge was the leader of the group who was perceived as the one who had the best wisdom on human affairs. The leader was usually the eldest with considerable experience of their limited worlds. Translated into modern organisations, competing parties, within a department, approach the superior for judging the issue. The superior will listen to both the contentions and give a decision. People are comfortable with that even though one party is disappointed. Of course, the people must view their supervisor as fair and just. Should they lack that trust, they will go to the next higher authority. If there are two unrelated groups they will go to the manager who is common to both for justice. The diagram (Figure 12.8) below explains this well: General Manager

Department Head A

Supervisor A

Worker

Worker

Department Head B

Supervisor B

Worker

Worker

FIGURE 12.8 | Appeal to Higher Positions We see that the workers of each section within a department take their conflict to their immediate supervisor (represented by dotted lines); the supervisors take their conflicts to the department head (represented by dash lines); and the department heads take their conflicts to the General Manager (represented by bold lines). Each level may supersede their immediate superior if they perceive him or her to be unjust. Each level also has their limits of authority. So a supervisor may have the authority to approve leave, he/she may not have the authority to approve expenditure.

Appeal to Arbitration We have learnt that unions and management go to arbitration for conflicts in labour relations. The arbiter is a person with some judicial background approved by the labour department. Arbiters give decisions on the conflict. A similar arrangement may be made by management to deal with other individual or group issues. They may appoint an impartial third party (ombudsman) to make an inquiry into a conflict and to give a recommendation on the matter. Unlike an arbiter, they can only give recommendations. The third party could be an internal person or an external one who possesses a professional reputation to give realistic recommendations. An ombudsman’s contribution is to gather information and help people overcome misinformation and misunderstandings.

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Systems Restructuring An organisation has other methods to resolve conflicts—through systems restructuring. Through this, there is greater interdependency and appreciation of other roles to get better cooperation. The systems approach ensures logical sequence of doing things and linking it with some authority and autonomy to process information. Such restructuring methods are:

Job Rotation This is an effective method with its origins in the hospitality business. Employees are rotated through other positions to eliminate myopic thinking and narrow loyalties. The employee entering another department may encounter suspicion and distrust initially, but soon becomes member of the team by contributing earnestly. Employees are able to see the other side of the fence and appreciate their strengths and limitations. This awareness brings a greater understanding, cooperation, and collaboration in the hospitality industry. Creating a Buffer One way to manage potential conflicts is to decouple conflicting groups and make them dependent on a third party. Most conflicts arise from the sharing of resources. The third party will be the impartial body to decide the allocation of resources based on needs. Chain operations have used this concept successfully when hotels in a chain, conflict in purchasing limited supplies in the market. They have created the central purchasing to purchase supplies for the entire chain at lesser bulk costs. Hotels in the chain need to go to only one source for all their needs. The concept is shown in Figure 12.9. Hotel A Central Purchasing Hotel B

Common Resource Centre

FIGURE 12.9 | Common Resource Centre

Creating a Buffer with a Linking Role In this system, an individual or group links two or more conflicting individuals or groups as shown in Figure 12.10. For example, in a hotel the sales executives always fought with the Sales Manager to get his time to discuss sales reports. The sales manager had other priorities and had little time or late hours left to discuss field reports. He solved the problem by creating a sales coordinator positioned in the sales office and available to sales executives and the sales manager at varying times in the day. Sales executives had to log their reports with the sales coordinator who was always in the office. The sales coordinator now discussed the field reports with the sales manager whenever he was free. The relationship is depicted in Figure 12.10: Sales Executive A

Sales Executive B

Sales Coordinator Linking Role

Sales Executive C

FIGURE 12.10 | Linking Role

Sales Manager

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Decoupling by Duplication This is a method which duplicates certain functions to ensure the smooth function of an operation. Take, for example, a hotel which has several specialty restaurants. There is bound to be conflict if all of them had to rely on the central kitchen for their food production needs. There could be conflicts over equipment, time, food supplies, and manpower utilisation. To solve this problem, the hotel creates smaller satellite kitchens to serve the food production needs of each specialty restaurant. The hotel has to invest in duplicate equipment, additional cooks, and separate stores for food supplies. Though this is more expensive, it compensates for food delays, employee conflicts, and the loss of control. Figure 12.11 below explains the concept: Duplicate Resources Satellite Kitchen A

Restaurant A

Service

Satellite Kitchen B

Restaurant B

Service

Satellite Kitchen C

Restaurant C

Service

FIGURE 12.11 | Duplicate Resources

Unifying the Work Flow Another structural style that can be used is to unify the work flow. That is, certain resources are made common to save costs. It may seem the very antithesis of duplicating resources. However, in certain scenarios it works and is cost effective. For example, modern large hotels build “hotels within a hotel.” They may have an executive tower, convention tower for groups, and a general tower for tourists. Each tower may have an independent reception for check-ins to take the load off the main reception. This is a duplicating strategy. However, all the receptions may use a common reservation centre for all their bookings. The reservation centre will distribute the concerned bookings to the respective tower reception. It is depicted in Figure 12.12.

Central Reservation Centre

Reception Executive Tower

Service

Reception Conference Tower

Service

Reception General Tower

Service

FIGURE 12.12 | Central Reservation Centre

Matrix Organisation Matrix organisation is one where certain specialist functions are made common to all functions. This supports the modern thinking that specialists support the frontline functions which give guest service. Previously, specialists had their own empires and it was difficult to get their assistance. Today, the specialists are evaluated

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in the manner they empower and improve the frontline performance. For example, the front office receptionists will get support from their function specialists as well as the other staff specialists. A matrix organisation would look like Figure 12.13 below: Functional Specialists Reservations

Telecommunications

Housekeeping

Staff Specialists Human Resources

Accounts

Front Office Receptionists

Information Technology

Service

FIGURE 12.13 | Functional Specialists There could be conflicts between the functional specialists and staff specialists, but it is here that the front office manager welcomes such conflicts using the expert opinions to make better decisions. For example, telecommunications may demand latest equipment to give the front office better service, but the accounts may not provide the budget. Both bring their respective arguments to the front office manager who makes a considered decision.

Bargaining Bargaining is the ability to influence the other party to agree to your terms. It is a method of resolving conflicts. Bargaining can happen when two parties have equal interests and authority. Organisations give formal authority to managers to bargain on behalf of their group. Bargaining can be explicit and implicit. Explicit bargaining is when both parties are aware that each is trying to influence the other by using authority, power, and bargaining skills. Implicit bargaining is more manipulative where one party does not recognise the situation as one of bargaining. The manipulator develops a relationship of value with the other party, and then tries to trade on that relationship by threatening to break or change it. This is normally found among individuals who have no official power over the other. A manager may use implicit bargaining by giving small favours to employees, only to encash upon than when in need. The union becomes a formal bargaining power to employees with otherwise no authority. Bargaining differs from dominance. In dominance, the dominator does not need the loser any longer. In bargaining, both parties recognise that they have to continue working with each other after the conflict. What we are dealing with is a continuum of attitudes from open hostility to closer cooperation. Along this continuum are two types of bargaining—distributive bargaining and integrative bargaining.

Distributive Bargaining This is like dominance but recognises that the other party can hurt you as well and will be around. In this bargaining, each party tries to get the bigger slice of the pie using power and bargaining ability but without totally disrupting the relationship.

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Integrative Bargaining This is more civil as it transcends conflict from bargaining to problem-solving. The parties work out how to bake a bigger pie so that both are satisfied. Each surrenders ‘territory’ for a common cause which is bigger and better. Research shows that bargainers tend to concede more when the other party has made a small initial concession. There is a willingness to cooperate but not to the extent that they will be exploited. Successful bargaining requires rational dialogue rather than emotional ones. Managers often ask conflicting employees to bargain and resolve their minor situations. They prefer to use this tool to ‘sort things out’ at their level than escalating it into serious conflict.

Mediation Mediation is a successful way of resolving conflict. Management, especially those who are leaders of teams, are given the authority to mediate between conflicting parties. The purpose of a mediator is not to decide what is right or wrong (that is the job of an arbiter), but to stem the conflict by making each party see the differing points of view and arriving at a compromise. The mediator helps re-establish communication, and if requested, recommends some solutions to the problem. Mediators assist both parties in confronting their real differences and discovering their common problems, and making adjustments to solve the problem. Of course, both the parties must be willing to confront each other. Most conflicting groups go on a barrage of tale-tattling behind the backs of the opponents. The mediator brings them to confront face to face their differences.

Essence of Conflict Resolution Conflicts in organisations are a good thing as they garner differing viewpoints to make quality decisions. A lack of opposition makes the organisation insular and stale. Conflicts, therefore, must be maintained and resolved at a rational level and not on emotional one. However, when conflicts fall to emotional levels, parties want to hurt each other till one surrenders. Sometimes, both hurt each other till both lose. There are three stances popularly known in conflicts: l l l

Win-Win Win-Lose Lose-Lose

Unfortunately, most conflicts end up as win-lose situations due to emotional reasons than rational ones. A manager’s task is to arrive at a win-win situation. How he/she does that?

1. Create a Superordinate Goal A superordinate goal is one that is larger than individual and group aspirations. People drop their petty differences to attain the larger goal. The goal has to be convergent rather than divergent. The intent is to foster cooperative behaviour. Tribes created an external enemy who could destroy them all. The goal was to vanquish the enemy. Soon individual and group differences vanished or were put on hold till the enemy was vanquished. That same concept is true today. Management can create a competing hotel as the ‘enemy’ and beating it as the superordinate goal. Another way to create a superordinate goal is to create one internally. The organisation can declare that unless all employees ‘pull up their socks’ the organisation is forced to liquidate or restructure involving layoffs. Employees pull together to make their jobs secure by making the organisation succeed.

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However, one must be cautious with this strategy. When all employee attempts fail or when failure is inevitable, conflicts will arise to unimaginable emotional proportions for individual survival.

2. Use Reward Systems Rewards are a wonderful way to resolve conflicts. Rewards to some may be a de-humanising concept. Fredrick Herzberg called it positive KITA (Kick in the A…..!) He promulgated that people were manipulated using external incentives to perform. He believed that motivation came from within not without. However, managements today have changed from the industrial age and look at inter-group performance as a measure to earn rewards. We saw in matrix organisations that specialist performance was evaluated on how they were able to augment the performance of the frontline. They received rewards of there performance of which this was one of the criteria. Modern organisations are looking at group incentives and inter-group incentives as means of giving merit awards.

3. Use Internal Structuring We have several structuring models mentioned before to prevent conflicts. Organisations should study their process flows to avoid potential conflicts that could be counter-effective to the organisation.

4. Encourage Interdependence Make jobs and functions interdependent so that both parties need the cooperation of each other to succeed. Connect processes that will be complete when both parties perform well. Reward cooperative behaviour.

5. Review Conflicts Past conflicts must be studied to see the points of friction. Try to eliminate those contentious points so that the conflict will never arise in future. Friction can be caused by individual behaviour, faulty systems, and processes or a lack of collaborative arrangement.

6. Give Equal Authority Both parties must have equal authority to convert conflicts into bargaining behaviour where both have to cede a bit to solve the problem. Authority also enables problem solving and mutual resolution.

7. ORGANISATION DEVELOPMENT Organisation Development (OD) is a diagnosis of the organisational ills and focusses on the organisation purpose, organisation culture, and human interaction process in the belief that these factors are the root of all problems. OD is a process of planned change through a change of personal values and how people treat others. OD is conducted by an expert—the HRD Manager who is trained in OD or outside consultants. They are ‘change agents’. The general model of OD development is: l l l l

Diagnose the organisation Plan the change process and have it approved (by top management) Change the attitudes of individuals in the way they treat each other Change group climate or culture through change in values and habits

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Introduce elements like sub-goals, job descriptions, authority, etc. which will foster better working environment Solve day-to-day problems that arise out of change.

The OD effort is driven by strong training and development programmes that discuss interpersonal problems and those behaviours that impede progress. It is the groups who identify problems and evolve solutions for better effectiveness. In discussing day-to-day problems following questions are answered: l l l l l l l

Do we trust each other? Do we have genuine concern for others? Do we openly discuss our feelings? Do we listen to others or do we work on our own? Do we accept conflicts and work through them? Do we utilise the strengths and capabilities of our team members? Are we committed to team objectives?

Need for OD OD had never been so crucial in the past as it is in modern times. Globalisation has brought worldwide competition. Markets are demanding better quality at the cheapest price. Technological advancement has brought shorter lifespans of products and services. This has forced organisations to restructure themselves and their strategies. We hear of layoffs, downsizing, flatter structures, etc. as means for survival in a turbulent marketplace. Technology has introduced new specialisations and equipment. With all this, the workforce has to be flexible to realign themselves. Customers are changing and so are their demands. Old ways of doing things are suddenly dumped, bringing fear and uncertainty to employees. OD interventions, therefore, are now more relevant in these changing times. OD is the method to alter attitudes and relationships constantly. OD interventions enable employees to express their apprehensions and needs. The employees also have a voice to tide over these changes in a manner that is comfortable to them. Just as employment is a work contract, the relationships in the organisation become psychological contracts. Through OD the organisation can harness commitment and loyalty. The main challenge comes from older employees who bring with them certain attitudes based on past experience. Their attitudes need to be reconfigured in changing circumstances. OD efforts try to get people to see the world as it is ‘here and now.’ The modern world has made information and technology obsolete in short periods. Continuous education is no longer a luxury, but a need for survival. OD helps people to learn how to learn. People have to learn to adapt to new situations and formal relationships. They have to learn to give constructive feedback and exhibit transparency in dealing with others. The key to relationship building is to appreciate the other person’s job and concerns. Change is a good thing. It makes employees sensitive to changes at the marketplace and changes in customer needs. People, who have done the same job for years, may lose sight of external changes. Older people are lulled into matters of status, prestige, and holding office rather than in solving problems and being part of change. An organisation that is adaptive to change is organic (Burns and Stalker) characterised by: l l l l

Loose boundaries between departments Flexible job assignments adapting themselves to where a problem has to be solved Commitment to company goals which means they have vision beyond their team and department goals Creating committees and task forces to cut across departments and jobs to solve problems.

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Mechanistic organisations with fixed job descriptions and precise department boundaries produced employees loyal to the immediate boss. Their aim is to please the boss and not to solve problems. In OD, power and authority is shared. This has facilitated the creation of empowerment of employees as a viable and potent practice.

Methods of OD There may be various methods employed specifically to the organisational condition. However, all will take the following approach: 1. Diagnosis, that is the gathering of information about the organisation and interpersonal relationships. 2. “Unfreezing” which is giving a feedback to the employees bringing attention to those interpersonal relationships that are dysfunctional and cause operating problems. 3. “Freezing” by team planning of new solutions to operating problems and the way work should be conducted. The OD expert becomes a facilitator, educator, and trainer. He ‘looks into’ the organisation from the outside and gains people’s confidence as he/she has no personal stake in solutions. The above may be done by several methods:

Questionnaires The OD expert conducts surveys with pre-defined questions. The questionnaire is administered individually. Another way is to get department heads to call a conference of his or her team to fill the questionnaire as a collective opinion. Typical concerns brought out are: 1. 2. 3. 4.

clarity of organisational goals; organisational climate; how employees feel or believe about themselves; and the manner in which decisions are made especially when resources are allocated.

T-Groups or Sensitivity Training T-Group stands for Therapeutic-Group—this method goes to the root of people’s attitudes to discover why they behave in certain ways. In this method, an individual is placed in an unstructured environment (i.e. without chairs and tables) with other people. There is no agenda, no subject to be discussed, no rules for operating, and no leader (or authority figure). The trainer is just another member in the group. The trainer only reminds the group of the purpose of the meeting and that is to observe our own behaviour and that of the others. The nonintervention of the trainer is exasperating making participants feel the situation is really nonsensical. Another characteristic of such sessions is that they concentrate on the ‘here and now’. Many may tell stories or past experiences to fill time, but the trainer focusses on them to see what they are doing and why they are doing it. The system works on the belief that a vacuum situation brings out behavioural insights never seen before. With no family, no parent, no duties, no agenda, no boss, no organisation, no rules, no customs, no policies, and no direction people are forced to rely on their inner attitudes and beliefs they bring to the group. The insights that emerge in T-Group sessions are inner attitudes, beliefs, habits, behaviour in a conflict situation, leadership issues, etc. The process of unfreezing takes several days and trainers are then able to discover ways to modify attitudes that bring about positive changes. T-Groups have been used successfully in many organisations. It has to be administered by trained trainers in sensitivity training.

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Simulated Games This is very different from T-Group session because it simulates real life scenarios. The simulated games create goals, agendas, time limits, performance, code of conduct, etc. just like the real world except that the consequences are not as threatening as in the real world. People normally assume the attitudes and behaviours of the real world. The trainer’s job is to bring them out for analysis and discussion. Most games are designed to bring below average performance only to highlight the attitudes and behaviours that result in failure. Participants are willing to look at themselves more readily in a fun environment and are able to receive critique easily. Critique is different from criticism. Critique is a feedback meant to develop a person focussing on the issue and not the person, while criticism is aimed at the personality, and is, therefore, aggressive and humiliating. Then they discuss ways of how they could have performed better with renewed attitudes and behaviour. Many groups want to get the second chance to perform using their new knowledge of themselves. Most simulated exercises bring out competition (issues of winning and losing), trust and openness, conflict and its resolution, shared problem solving, and attitudes to leadership and authority.

Fish Bowl Exercises This is a unique method in OD. It differs from the earlier two methods as it deals with real life issues at work. It is especially useful in developing effective interdepartmental coordination. Departments are required to bring their real life issues and list them down. These lists are displayed. The entire group of departments form a circle (fish bowl). Each department nominates a pleni-potentiary to represent them. These representatives sit inside the ‘fish bowl’ and negotiate solutions to the problem. The trainer focusses them on problem-solving rather than problem surfacing. He focusses on attitudes and behaviours impeding solution-finding. Traditionally, departments come to sling mud at each other. The trainer’s role is to prevent that and focus on problem solutions. The trainer also highlights the dysfunctional stances and attitudes in finding solutions to problems. The larger groups’ job is to sit silently and observe behaviour. The interaction within the fishbowl is a microcosm of the attitudes and stances they hold in real life. They are able to look inside their own stances and behaviours. The departments finish the exercise with solutions to problems and new ways to bring about better inter-relationships. The most important learning is the importance of openness and candidness, personal attitudes and stances, inter-relationship issues, and problem solving through discussion.

8. MANAGING CHANGE One thing is constant and that is change. The hospitality industry has witnessed sweeping changes since the first inns. Who could have imagined super-structures like the Burj-al-Arab that has caught the attention of the National Geographic, or the Hydropolis, a hotel below the sea in China and Dubai? Hotel chains revolutionised hotelkeeping exporting brands and systems abroad. The restaurant industry was not far behind when fastfood was introduced into our common lifestyle. Globalisation has made available cuisines which people never before thought they could get next door. The future too is only promising change with space hotels and the underwater Hydropolises becoming more numerous and glamourous with time. New sets of skills have also emerged. People are required to be multi-skilled with proficiency in many languages. Who would have imagined Mongolian barbeque in upmarket shopping complexes or the cybercafes at street corners? These transformations have brought home to the organisations the lesson conveyed by the saying—change or stagnate.

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The global economy has brought unprecedented competition of the best quality at the cheapest price. This was only possible through innovation. Innovation is the cornerstone of the competitive edge. This naturally brings change in skills, knowledge, attitudes, and organisation structures and systems. Another saying— “Innovate or die!”—shows the spirit of modern times. To survive, organisations are forced to restructure, de-layer, merge with other organisations, or acquire new organisations. All these business strategies require changes in management, organisation structure, work systems, and ways of performing. If change is inevitable, then organisations have to adapt to the changes. There are two types of business approaches that are likely to succeed in the future—micro business and mega-business. It is, therefore, not surprising that we have hotels with over 5000 rooms in Las Vegas, or real estate companies building mini-communities to support hotel operations or hotel chains swallowing up independent properties worldwide. At the other end, we have boutique hotels that serve very narrow niche markets. Also consider this: l l l l l l l l l l l l l

Computer technology has produced information for on-the-spot better decision-making Mass communication has made the consumer more aware and he demands the best The employee has now become a knowledge worker with better skills Management education has also changed, backed by research Technological discoveries have changed lifestyles and the way we do things The market is now global and organisations think big Society has changed with technology and the breaking of traditional mindsets Governments have broken down national barriers for global business The organisation now has to perform with a multi-cultural workforce The earning power of an emerging middle class has created new markets The global traveller is more adventurous and is culturally aware People value leisure and recreation to counter their humdrum work-life The future workforce consists of youth with seamless career opportunities and shorter career spans

This is a testimony to the rapid changes that have taken place for the individual, organisation, and society. With this background we have to think of change as a way of life and learn how to ride with it.

Essential Features of Change 1. Change redefines what drives an organisation. For example, if an organisation moves from a product-centric approach to a customer-centric one, we are changing the paradigms of how the organisation wishes to do business. This shift is transformational. 2. A change reconfigures the relationships within the organisation. The main relationship change takes place between managements. Modern organisations have changed from benevolent-autocratic approach to a more participative one. Information that was held holy by organisations has now become transparent. This brings in organisational structural changes. This shift is again transformational. 3. A change brings new ways of doing work. Organisations have moved from using manual to high technology systems. Organisations have also empowered front line staff to make decisions that their supervisors did in the past. Jobs have been enriched from repetitive and routine to wholesome and challenging. 4. Change brings in a cultural shift in terms of values, beliefs, reward systems, ownership of tasks, etc.

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Pre-Requisites to Change There are ten conditions, in order of priority, before a change can be achieved in an organisation:

1. Commitment of Top Leaders The CEO and his/her team of senior top management must be committed champions of change. Such commitment must be visibly supported. Lower levels, who will be implementing the change, must see the top management’s commitment and enthusiasm.

2. Written Description of Change It is essential to have a statement, written in behavioural terms, of how the changed organisation will function. The statement should include the basic organisational character, policies, values, and priorities that will exist as a result of change. This statement is not a list of short-term objectives, but a detailed description of process and what behaviours will are desirable.

3. Reason for Change There has to be a document explaining the reason for change. Normally transformational change involves survival issues. Employees must feel the fear of maintaining the status quo. Maintaining the status quo could result in winding up of the business, major layoffs, acquisition by another company, inability to pay salaries, cut in salaries, etc. This fear will motivate them to want a turnaround for their own survival.

4. Developing a Critical Mass of Support for Change The management will need to reach a critical mass of support for change to actually affect it. The HRD Manager can play a part in finding out present thinking through surveys and interviews and organising information seminars to rally support. The top management plays an important role in influencing their teams. While there are formal ways to drum up support, there are informal ways too, in cafeteria talk, approaching informal leaders, etc.

5. Taking a Medium to Long Term Perspective Transformational change takes years, not months. It is important that top management sees that perspective. They cannot expect a quick-fix solution like putting a band aid. Change involves dramatic changes in the organisation’s character. This cannot be done quickly. Change involves several smaller components that have to be addressed and mastered before transformation actually takes place. They have to do tight rope walking while juggling the issues of stability and continuity versus change.

6. Honour Resistance to Change Resistance to change is inevitable. Management must work with it rather than fighting it. No change can happen without resistance. As a matter of fact, resistance sharpens the approach to change. Resistance is the process of internalising change. It is the time required to let go of old familiar ways. It is normal. The important thing is to harness this resistance and make it work for the organisation rather than against it.

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7. Awareness of Training Training can be a wonderful tool to reduce resistance to change. An accurate needs assessment must be conducted followed by tailormade training and development programmes to address the knowledge and skills required for the change. The HR manager can play an important role in driving this education to align the organisation to the changes in behaviour required.

8. Willingness to Try The organisation should be willing to experiment. Some organisations do a test case with a department or unit and iron out any difficulties that are encountered before the change is introduced on a large scale. It must be accepted that difficulties will be encountered. It is the conviction that change is inevitable that drives the willingness to overcome obstacles. It is when difficulties are encountered that creative problem solving occurs. It also establishes the additional resources required to overcome problems.

9. Willingness to Commit Resources The biggest resource is the capital outlay for change. The organisation must raise finances to fuel the change. Other resources could include consultancy costs, technology costs, and the time of internal change agents.

10. Commitment to the Flow of Information Any change process must have a free flow of information. Transparency is vital. Employees must be aware of the new vision, values, objectives, plans, and rewards that will accompany a change. Everyone must also receive information about the progress of change including the difficulties faced. This avoids replicating the mistakes saving time and resources. Inadequate information leads to morale problems. The HR manager can be the conduit of information to all employees.

The Change Process 1. Organisation Diagnosis In introducing change the following initial phases must apply: l l l l

Define the change Determine the organisation’s capacity to change Determine the elements of change Determine the change agent(s)

Defining the Change The desired future state has to be articulated. It can be in the form of the change of vision and the strategic objectives of the change. Change goals must be clearly defined in terms of the change desired. These should be measurable to evaluate later whether change has taken place. In effecting change, the present set of conditions has to be ‘unfrozen’ and replaced by new conditions that have to be ‘refrozen.’ For this to occur, the change must happen from within the organisation. Change must be goal oriented and serve individual purposes also. The organisation should look at its own operations, test them against alternatives, and plan future improvements. The internal and external factors that influence the need for change have already been discussed above. Organisation change learns from its own experience. Generally, the existing situation is seen as the problem and the future state as the solution.

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Determine the Organisation’s Capacity to Change This is a diagnosis of the present state which obviously is not working. This can be done through employee surveys, interviews, and management’s human audit. The organisation looks at the organisation climate and its flexibility to change. It studies the attitudes and values of the people in the organisation and the skill deficiencies. The organisation also studies its processes in terms of practices, communication channels, ways of handling conflict, boss-subordinate transparency, policies and procedures, etc. The organisation has to also evaluate the impact change will bring to the purpose of the organisation. Will change destabilise the organisation or enhance its effectiveness? The organisation has to see the cost-benefit of such change. Determine the Elements of Change This is a complete analysis of what are the key factors of change. These key factors will need committed resources, change in behaviour, restructuring, new technology, etc. Some of the key factors are how the organisation will cope during the transition from the old to new; how to overcome resistance to change and get a critical mass of support; how to test change first; and what training and communication channels need to be created, etc. Determine the Change Agents Normally a professional HRD Manager is qualified to manage change. However, employees may view his/her input as manipulative and treat such attempts for change with suspicion. Organisations may still look to the HRD Manager for small internal changes. However, when larger changes are required, an outside consultant is hired who provides the blueprint for change after diagnosing the organisation.

2. Executing Change The formula for all change is the 7S formula—strategy, structure, systems, style, staff, skills, and superordinate goals. Lets us look at each: Strategy: Change in business strategy is based on internal and external conditions. Let us look at these: Internal Factors l l l l l l l l

l l l l l l

Organisation performance is declining Low morale of the workforce Guest service is slow Many guest complaints Lack of cooperation among departments In-fighting Resistance to change New business strategies (national to international, mergers and acquisitions, new products and services, creating multi-units, centralising-decentralising, etc.) Misfit between existing skills and new strategies Introduction of new technology Re-alignment of workforce (local-multinational, gender parity, age disparity, old-new skills, etc) Changes in methods and work processes Changes in organisation structure More crisis management

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External Factors l l l l l l l l l

Change in guest expectations Change in strategies by competition New emerging market segments (women travellers, budget travellers, baby boomers, etc.) New legislation impacting business Competitive market place Globalisation New technology Demographic changes (emerging middle class, age distribution, etc.) Psychographic changes (lifestyle, women earners, purchase behaviour, leisure patterns, etc.)

Organisation change requires the symbiotic realignment of all seven factors. This is reflected in a new business plan that has the strategic objectives of change along with the strategies that will bring about change. It will necessitate re-examining the organisations’ mission and creating a vision or desired future state. Strategy has the following considerations: l

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National versus International: For example, most American and restaurant chains started domestically perfecting their craft to the level that was ready for international expansion. They are now in every continent. Mass Markets versus Niche Markets: Hotels provided lodging to anyone who could afford the room price. They later saw the potential for a niche market—the business segment. Soon, hotels were building tower blocks and reserving floors for corporate and business market with appropriate facilities like the business lounge, business centre, broadband internet facilities in the room, writing desks, etc. to serve this segment. Hotels world wide saw the merit of serving other niche markets by opening casino hotels, convention hotels, furnished apartments for long staying guests, etc. Product Orientation versus Customer Orientation: Earlier hotels built beautiful edifices with luxurious appointments and convenient facilities. They then ‘pushed’ sales to fill the rooms. Product orientation was alright as long as there was a shortage of supply. Once the market became competitive with abundant supply and with a demanding customer, the hotels had to become customer-focussed. They built hotels and services around the needs and expectations of the customer to survive. Today, most hotels and restaurants adopt the customer-focussed approach. Discounting versus Value for Money: Earlier, the only tool that sales people had to get business was to offer discounts on room tariffs. This naturally affected the revenue earnings. Through product differentiation the same sales person is able to earn higher revenue. For example, a receptionist could sell a room facing the golf course at a higher rate than one facing a building block. The room at the end of the corridor was quieter than one opposite the guest elevator. The room at the end of the corridor could earn better room rate than the noisier room. Backward-Forward-Horizontal Integration: Backward integration is a strategy of developing a business in source markets. For example, a hotel chain may decide to establish a central reservation office to feed the hotels with bookings from geographically spread locations. They make it convenient for people to book a room easily from wherever they are located. Forward integration is when the business wishes to capture the business in the next step in the business chain. Airlines opened their own captive hotels—Air France, the Meridien Chain; Air India, the Centaur Chain, etc. Here, they believed that since they carried passengers to destinations they had a greater influence on where they stayed. They were able to bring substantial success in this strategy. Horizontal integration is when

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hotels enter into similar lines of business, but for a different market. Big hotel chains now have segmented hotels to serve different markets. For example, the Marriot Chain has segmented brands of properties like J.W. Marriot, Marriot Marquis, Marriot Hotels, Marriot Inns, Courtyard by Marriot and Fairfield Inns to serve the luxury, mid-range and budget consumers. The strategy uses the synergy of its core business to enter many more market segments. Single Product Line or Diversification: Diversification is going into other unrelated businesses. ITC Ltd., a traditionally staunch cigarette company, had used backward integration by growing tobacco and forward integration by opening their printing and packaging business to pack their cigarettes. In the 70s, they decided to diversify into hotels opening the prestigious Welcomgroup chain. They have further diversified into foods, agri-business, retail, consumer goods, etc.

All these strategies require change in terms of structure, organisational conditions, and behavioural changes. Structure: Structure is the way the business is organised to meet strategic goals. The structure of the organisation has to fit the strategies. Structural decisions will have implications on the type of people employed, size of the firm, and the level of technology required. There are many options to structure: l

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Centralisation versus Decentralisation: For example, the corporate office may centralise business strategy formulation, allocation of capital, legal issues, central audit, etc. The strategic units can be concerned with unit revenues and profit, labour relations, operations, local marketing, purchasing, etc. Decentralisation occurs when the organisation has multiple units and/or is diversified. Hierarchical versus Flat Structure: Modern organisations are de-layering their structures to bring in greater participation and autonomy at customer contact levels. Line versus Staff Structures: Line is the operations who are in direct customer engagement. Staff is the specialist support, e.g. HR, IT, Finance, etc. Their inter-relationships and roles have to be clearly defined to suit the new business strategy. Internal versus Outsourced Resources: Decisions have to be made whether certain functions can be outsourced to save cost and reduce departments and people. Naturally, such decisions are based on availability of reliable contractors and the cost-benefit factor.

Structures must move towards fewer layers of accountability. Systems: These are the processes employed that drive operations. The greatest revolution has been created by technology. Computers and innovative software have made information processing quicker as much as providing much needed data for quick decision-making. Yield management has been an innovative systems change to rake in more revenue. Work organisation has the tricky challenge of ensuring continuity, at the same time guiding the organisation to change. Work design reconfigures jobs to bring in more customer focus empowered with autonomy and authority. Certain changed goals may require change in job descriptions and retraining job holders into their new roles. This will require work rationalisation and job redesign. The new work practices should move to fewer and more flexible jobs. The fewer jobs would have increased responsibility and accountability. The buck should stop at the guest contact level. Employees should no longer depend on hierarchies to resolve their problems. Style: The style is the cultural configuration of doing things. It starts at the top where the approach to change is first conceived. The distribution of authority is essential to the process of change. Let us look at this in detail:

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Distribution of Authority (Power) In looking at the various major approaches to introduce organisation change, one finds it has a relation to the continuum of power and authority. This means who brings in change. The diagram (Figure 12.14) explains it:

Unilateral Action

Shared Action

Delegated Action

FIGURE 12.14 | Authority Continuum

Unilateral Action The unilateral action is at one end of the continuum where the authority lies with a power figure, usually the owner or Chairman. He can exercise his power for change in three ways: By Decree This has been a historical approach introduced by kings, the military, or sole proprietor. They believed that they were the only ones who were competent in deciding the future of the followers. They just gave an order and it had to be followed. There were heavy penalties for not following the orders. It was a one-way downward communication which decreed that “This is the way it is going to be done from now on.” The nature of the decree is impersonal, formal, and task-oriented. It works on the belief that people like an authoritative decision. This method works when people are uneducated and cannot rationalise the outcomes. They have faith in the leader and willingly surrender to the power. It is very unlikely that this approach will succeed in today’s work environment unless people are unaware of the new change. By Replacement Once the decree system has failed, the next best option is to replace key personnel who have become outdated, with younger ones. Obviously, the older key people were unable to bring change as desired and needed to be replaced. It works on the belief that if key persons who are the drivers of change are unable to change to modern ways, the best is to replace them with younger change agents. Again, the decision is made at the top and directed downwards. The approach is to get the task done. By Structure One great method to bring in change is to reorganise the structure. Organisation structures have been discussed in Chapter 3. It is with this intent that modern organisations opt for flatter structures or reverse pyramid structures where the service givers are given much more authority to determine the best guest experience. Structural changes are rational, formal, and sometimes impersonal. The structural changes are made by the top authorities who may refer to organisational consultants. Sharing of Power This approach comes at the centre of the continuum. It is more participative and involves groups in the change process. This approach has two forms: By Group Decision-Making Though the problems and changes desired come from the top, the process of creating the processes for change is left to the group. It works on the belief that people are more committed to solutions that they have evolved in comparison to a decree from the top. It also recognises that the people are now capable and knowledgeable to come up with quality action plans for change. They have to be aware of external changes and be able to adapt them to the internal circumstances. By Group Problem-Solving In this approach, the group is required to identify the problems and find solutions through change. It differs from Group Decision-making in that as the problems were earlier decided by the top and presented to the group to solve, in this approach, the group has to find the problems through group discussion, analysis of performance, etc. and find viable solutions. Again, the belief is that the group members are capable, and because they are close to the problem source, are able to rectify it.

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Delegating Authority This approach is the other end of the continuum and gives complete freedom to employees to manage their own problems and find solutions. They are made accountable for their performance to bring in change and are even evaluated for the new ideas they bring to the work place. They are responsible to iron out the problems they encounter during change and find lasting solutions. Here too, there are two approaches: By Case Studies Here, the groups are required to gather information through research and deliberate upon it. They may use a facilitator who is a consultant or senior boss to guide their decision-making processes. The facilitator does not impose his/her views, but asks meaningful questions that will help them evaluate all angles to a problem. By T-Groups This approach is specifically to alter individual and group attitudes to change. While it is targeted to the key management, it is hoped that they will be able to translate their new learning into action within their functions and influence the group affected by the change. T-groups concentrate on social processes, i.e. how to help people accept change and remove resistances to it. The modern organisation has adopted a more participative process of work organisation. Unilateral approaches will only be used in a crisis when there is no time for group consensus. There has to be a major cultural change. Organisations must review those values that are outdated (e.g. Product focus versus customer focus; closed versus transparent information; problem prevention versus problem resolution; etc). Staff The sharing of authority implies that the employees have to be fully involved in the change process. Communication is perhaps a very crucial aspect of change. Employees must be spoken to individually and in groups to get their buy-in. Every query or doubt must be addressed. They must realise the need for change and how it will affect their future. The communication must continue during the progress of change to receive feedback and resolve niggling issues that may arise. The communication continues further in the quarterly performance reviews. It is important to understand that change implies continuous dialogue. The process will hopefully create an informal network of innovators. Employees will have to possess enriched skills with a degree of management. Skills The term is a composite of knowledge (cognitive information), skills (psychomotor capabilities), attitudes (the predisposition to change), and competencies (desirable behaviours). The existing capabilities of employees are critical to the change process. It is essential to conduct a human audit to make an inventory of skills available and whether they serve the purpose of change. Deficiencies must be identified, following which the organisation has two choices: (i) To retrain existing staff to the new skills required; or (ii) to hire employees with the new skills required. Education, in the form of training and development, is vital to the change process. Training may come in many forms: (a) (b) (c) (d) (e) (f) (g)

sponsoring senior management to executive programmes by reputed business schools; T-group programmes to renew personal values and stances; Technical training in new skills; Cross training to gain flexibility; information seminars; team-building workshops; and planning conferences.

Set Goals Goals have to be set at the organisational level, functional level, and individual level. These goals will later be translated into annual objectives in the performance appraisal. This involves all the management to pledge ownership of the goals. The planning conference/workshop is an excellent vehicle to

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set goals. Organisations use a change strategy of competitive benchmarking to adopt the best practices. They would have benchmarks for revenue realisations, costs, quality, lead times, and routine business administration. The business plan should be transparent and employees should be involved in how they can meet the goals.

How to Effect Change in Modern Times? Here is a list of suggestions that can help an organisation in bringing about change. l

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Successful change can take place when the power distribution moves from unilateral authority to shared authority. People will change when they are involved in shaping it. The management can hope for greater commitment and lesser resistance. Change must start from the top. People in authority must be able to change first. Change cannot happen suddenly. There has to be a process of consultation with the workforce and developmental tools used to prepare people for change. The best way to manage change is to be in a constant process of change. People learn to become more adaptable. Make change a key performance expectation. Build innovation and change into performance expectations at all levels. It gets people thinking of new ideas. Support innovation with reward and recognition schemes. To bring about change is not the privilege of management alone. It is the responsibility of every employee in a small or big way. It can be encouraged through a philosophy of continuous improvement. It involves everybody. Bring in fresh blood into the organisation, especially in key job positions. Empower them and make them the nucleus of change. Create a research cell to continuously monitor external changes. Alternatively, make research a key task of senior management. The HRD can be the research cell for internal matters, especially involving employee orientation. In fact, HRD introduces and implements those development processes to realign the workforce to change. There is no shame in consulting external experts on change issues. Make the organisation more transparent. Transparency means, first, to employ an ‘open-door’ policy where any employee can access their superior at any time; and second, let the employees have the right to information. They should know where the organisation is heading.

Summary Organisation Behaviour (OB) sees how organisations work to meet their goals. It evaluates individual and group behaviour and those factors that impede harmonious relationships. Its objective, therefore, is to come up with a design and action to empower an organisation to meet its goals. This becomes especially relevant when goals are constantly changing. OB, therefore, requires an understanding of organisational design, group dynamics, managerial leadership, and individual motivation. Conflicts arise between groups and individuals when they work together. Therefore, conflict resolution is an integral part of the OB process to create a better working environment. Better working relationships are fostered by improved interpersonal and business communication. The application of new behaviours desired is through a process of Organisational Development (OD). The process involves (Contd.)

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Summary (Contd.)

diagnosis, unfreezing old practices and beliefs, and refreezing them with new behaviour to meet the changing goals. The underlying purpose of Organisational Behaviour and Organisational Development is managing change. These disciplines empower an organisation to develop a culture of continuous change using all the elements of change management. Change is inevitable, invoking the proverb “Change or Die!”

Key Terms Interaction Activity Sentiments Group norms Informal groups Cohesion Organisation Development T-Group

Behaviour between people A job comprising of component tasks Emotional and mental processes in relationships Joint feelings that lead to group behaviour Groups outside work contexts with members having common interests and sentiments The ability to be coordinated, logical, and consistent A process of planned change A training method to change attitudes

Review Quiz Short Notes 1. Write short notes on the following: (a) Organisation Design (b) Anatomy of a Group (c) The Managerial Grid (d) Forms and Formats in business communication 2. Explain Maslow’s Need Hierarchy. 3. What are the various forms of conflict? 4. What are the ways to resolve conflict? 5. What are the methods used in Organisational Development (OD)? 6. What are the pre-requisites of change? 7. Explain the 7 S of change.

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Human Resources Information System (HRIS)

Human Resources Information System (HRIS)

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1. CRITERIA FOR SELECTING AN HRIS We have learnt by now that we are in the Information Age and that information is a valuable asset to make quality business decisions that give an organisation a competitive edge. While technology and software have pervaded most hospitality operations, HRD is not far behind, and needs to keep pace with the changing business scenario. This chapter is not meant to prescribe HRIS software brands as most are costly. An HRD manager cannot just buy software and hope for the best that it will serve its purpose. Each organisation is different and what HRD managers need to know is what they need before making HRIS software purchasing decisions. India has the advantage of software development capability which is cheaper here than in most parts of the world. An organisation can benefit from developing a system from local expertise because the software can be tailormade to their way of working and needs. The HRD manager needs to know how to guide the software developer to serve its needs. So let us first see what the criteria are when selecting an HRIS.

Integration Integration is the ability to link with other databases and computers. HRD managers make quality decisions by harmonising information from various sources. These sources may lie in finance, operations, marketing, business development, and strategic planning. We have learnt by now that top management considers its human resources as an asset and makes decisions about it in their strategic planning. HRD, therefore, is an essential component in making decisions about the future of the organisation. HRD cannot work in isolation but must be integrated with business planning and operations. Therefore, the HRIS selected must be compatible with all other systems and information databases. For example, it is quite possible that HRD has different software for career planning, succession planning, performance management, etc. The HRIS must be able to integrate the individual software into one composite system. When looking at integration the HRIS must be linked: l l

to other computers, to other software,

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to other databases, to e-mail and fax,

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to legal help, to intranet applications, to payroll,

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to word processing, to reporting systems, to other HR software.

Such integration combines information for better decision-making.

Cost-effectiveness Decisions to deploy an HRIS must bring cost savings to the organisation. Research shows that a 10 per cent cost saving is possible and acceptable. The HRIS must reduce backoffice work and costs and bring speed in transactions and sharing of information for better decision-making. Then, the investment in HRIS must also be considered. It should be able to give a fair rate of return to the organisation in terms of reduced costs. Investment decisions in HRIS can ensure cost-effectiveness if the HRD manager has done a thorough study and analysis of its information needs. It is not advised to buy just any HRIS off the shelf. It is recommended to tailormake it to the organisation’s needs.

Data Access Control Modern HRD practice has brought much more transparency into the organisation. Transparency means the access to information. Organisations have created intranets, i.e. internal networks of information through the computer accessible to all employees. Some information is “view only” to general internal public while others can be modified and updated by the HRD. For example, the HRD policies are now displayed on intranet as a “view only” feature. Employees can refer to policy at any time from their desk top computer. No longer do they have to refer to a superior or the HRD for clarifications on policy. It is all there before them and it saves time and frustration. The HRIS now must be able to configure that information that is “view only” and those that are modifiable. The HRIS must be compatible with the existing intranet. It must provide the following: l l l l l

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Employee self-service Updates on HR records (leave, rewards, compensation, etc.) Online MIS Ability to carry large texts like policies and procedures Job vacancies integrated with the organisation’s official website under the subject ‘careers with the organisation’ Leave records.

Upgrades The HRIS must have the capability to be upgraded. We know that knowledge and technology is changing very fast. Obsolescence is a common fear amongst most organisations. The arrangement with the vendor of the HRIS must ensure that upgrades are part of the contract, provided at cost or free so that the system is current and fresh.

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Seamless The HRIS must become part of the ocean of information generated by its link to various databases. We have discussed integration, but here we want unfettered information as part of the transparent organisation. HRD must know on a moment-to-moment basis what the developments in tactics of various departments are and what are the new strategies employed by them in order to adapt quickly to those changes.

In-depth Reporting The main purpose of HRIS or any other information system is information. Information is useless unless acted upon for the organisation’s benefit. The HRIS must be able to analyse, interpret, and present visually data and information, so that decisions can be made. The kind of features required for reports are: l l l l l

Analysis trees Unlimited user license Graphics Interactive graphs Response to pre-determined formulae

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Drag and drop use Integrations Analysis through different databases Customisable and configurable system

Warehousing Warehousing is the ability to store information. While smaller organisations can manage with desktop computer capacity, large organisations will need mainframe servers. The HRD manager has to look at the volume of information required and that which has to be stored. Organisations store information to retrieve at appropriate times for decision-making. It is particularly useful to see historical trends for present and future decision-making. The HRIS must factor in exactly the kind of information and its volume each year required for warehousing. Each organisation has its policy of the number of years they wish to store data. It may range from one to five years.

Mining Mining is the ability to retrieve information easily from the morass of information stored in the warehouse. The HRIS must have the ‘search’ capability to retrieve information quickly. This is particularly important for the HRD manager to make strategic and tactical decisions in fast changing scenarios.

Scalable This is the ability of the HRIS to be expanded as the business grows. A hotel or restaurant chain may need to expand the capability of its HRIS with each new hotel or restaurant it adds to the chain. It should be able to expand its capacity as well as its features.

Training The vendor that supplies the HRIS must provide training to the employees using it. This training is ongoing as new features and upgrades are incorporated. The training must be accompanied with user manuals. An HRIS

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is as useful as the skills of the people using it. The HRIS must be fully exploited in its potential to serve the organisation. This potential can be only understood through training.

Maintenance The vendors must provide maintenance in case of systems breakdowns. Their response to an SOS must be quick and the downtime minimal. The disadvantage of international HRIS purchases is this factor. They are too far away to provide immediate attention. Some organisations may have online maintenance facilities but this would mean giving access of the system to the vendor.

Security This is of major concern and needs to be addressed. While the HRIS must have multiple access, some information must be controlled. This is done through user IDs. The HRIS must have this facility and be able to compartmentalise information that is ‘view only’ and that which needs user IDs to access and modify. For example, personal salaries can be only known to HRD, finance, and the individual employee. This information must be secured.

2. APPLICATIONS OF HRIS Let us examine the kind of information required by HRD:

HR Planning l l l l l l l

Organisation charts HR Policies and procedures (on intranet) Organisation Rules and Regulations HR Budget Job Analysis and Design Succession Plans Software and records Job Evaluation Software and records

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Organisation information Organisation standards HR Annual Plan Industry standards Career Plans Software and records Knowledge and Skills inventory Hospitality Staffing Norms

Recruitment l l l l l l l l l l

Job Descriptions Talent Bank Vacancy details Applicant search Applicant correspondence Applicant addresses and contact numbers Online applications Compensation structure Photographs of applicants Record of Orientation Programmes

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Applicant details Job Specifications Job Advertisements and postings Applicant status Applicant tracking Standard Job Offer and Appointment Letters Departmental and unit vacancies Job-person matching Interview scheduling

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Analysis and Reports l l

Sourcing cost analysis Recruitment cost analysis

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Sourcing statistics Vacancy costing

Compensation and Benefits l l l l l l l l l l

Compensation and benefits structure Overtime records Individual pay slips Individual pay histories Leave records Leave requests and entitlements Wages administration Performance Appraisal rating Vacation entitlements Progressive Payroll costs to sales turnover percentage

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Salary grades Attendance Pay reviews and proposals Deductions Maternity benefits and trail Ad hoc payments Allowances Payroll costs Information on rewards issued (bonuses, increments, etc.)

Training and Development l l l l l l l l

Training Needs Analysis Budget control and cost allocation Trainee profiles Cancellation management Classroom bookings Post Training Knowledge inventory Skills gap analysis External training programmes

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Programme scheduling (colour planner) Online course bookings Lecturer profiles T&D administration Performance appraisal recommendations Training Records Competency details Course evaluations

HR Administration l l l l l l l l l

HR files Standard letters Contracts with vendors Labour Laws Budget control Employee turnover records Grievance reviews Expense control and management On-line expense approvals

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Personnel files Staff Lists Employment history Competition data Absenteeism Disciplinary reviews HR reports Time-recording New Employee joining records

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Expenditure analysis

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Analysis and Records l l

Expense cost analysis Administrative costs

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Employee Relations l l l

Union Contract History of Disciplinary cases Employee Recognition records

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History of Union issues Suggestion Scheme records

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Emergency Plan (on intranet)

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Employee Health and Safety l l

Employee Accident Records Safety Rules (on intranet)

Summary An HRIS must be specific to the needs of the organisation. For this, the HRD manager must know his or her needs and the kind of decisions he/she will be required to make on an ongoing basis. There are several criteria to be kept in mind in selecting the HRIS software which primarily hooks up with other databases. Information must be easily retrievable. HRIS is expensive and a capital investment that must ensure a return on investment in terms of cost savings and profitable use of information.

Key Terms HRIS Warehousing Mining Scalable

Human Resources Information System The ability to store information The ability to retrieve information The ability of the HRIS to be expanded

Review Quiz Short Notes 1. Explain the criteria for selecting an HRIS. 2. Give the applications of HRIS to Training and Development.

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References

References

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