HR management troubles the global hotel industry

In a recent survey of 243 managers, human resource management issues were identified as the most troubling for property-level general managers and corporate executives.

Persistent problems often are the source of worry and lost sleep for managers in the highly competitive lodging industry. In a recent survey of 243 managers, human resource management issues were identified as the most troubling for property-level general managers and corporate executives. The study, administered in cooperation with the Center for Hospitality Research at Cornell University, identified a common set of shared problems that impede the ability of industry leaders to manage effectively. While economic, environmental, customer-need and operating cost issues surfaced from the open-ended questions in the survey, 64 percent of respondents from six different regions of the world reported human resource issues of attraction, retention, training and morale were their key areas of concern.
Exhibit 1: Importance of human resource concerns (means) by position

Concern All respondents Executives General managers
Attraction 4.65 4.51 4.78
Retention 4.58 4.63 4.54
Training 4.57 4.39 4.68
Morale 4.50 4.33 4.54
Career opportunity 4.24 4.10 4.23
Employee skills 4.15 3.94 4.20
Labor shortage 4.14 4.14 4.16
Benefit costs 3.93 3.78 4.00
Compensation costs 3.92 3.82 3.92

Training, employee morale and skill levels

Concern North America Europe Asia Middle East South America Africa
Attraction 4.87 4.57 4.49 4.65 4.65 4.44
Retention 4.58 4.61 4.58 4.52 4.71 4.44
Training 4.62 4.49 4.63 4.43 4.71 4.33
Morale 4.64 4.38 4.47 4.57 4.35 4.44
Career opportunity 4.32 4.08 4.30 4.30 4.29 4.00
Employee skills 4.24 4.02 4.12 4.30 4.35 3.78
Labor shortage 4.29 3.93 4.14 4.22 4.06 4.33
Benefit costs 4.32 3.66 3.89 3.83 3.65 3.56
Compensation costs 4.14 3.64 3.95 3.91 4.06 3.56

Attracting and retaining talented people

Exhibit 1 below provides mean importance scores about the key human resource issues, using a scale of 1 = very unimportant concern to 5 = very important concern. As the survey data show, general managers were more concerned with attracting talent, while executives expressed more concern with retaining people throughout time. Executives and general managers agreed the next two important areas of concern were the quality and consistency of training and employee morale. Finding time to train was a challenge expressed by many hotel managers, while executives said finding top talent for general manager positions was becoming more difficult. Competitive pressures were mentioned often as impediments to devoting time and resources to training staff properly.

General managers place greater importance on employee morale and the lack of employee skills than executives, who worry more about retention. Unmotivated staff and the lack of experience are common hurdles to providing quality service. Balancing skilled and inexperienced employees are viewed as operational challenges that often created morale problems. Many noted the stress of the work and linked too few rewards as an explanation for why employee morale is low. Aligning employees and company objectives to get staff to go the extra mile is viewed as a challenge, and morale issues often are linked to ongoing turnover problems that affect the ability of staff to deliver service standards effectively. With falling occupancies and staff layoffs, the concern for labor shortages might have receded during recent months, but new HR challenges are likely to emerge.

HR management worldwide

To refine our analysis of the most important HR concerns, Exhibit 2 shows the mean importance scores on the HR issues of concern broken down by six different regions of the world. As the data show, attraction, retention, training and morale are the top four issues of concern on managers’ minds from every part of the world. Attraction is most important for managers in North America and the Middle East; retention tops the list for European respondents; and training worries Asian respondents. Attraction, retention and morale are tied for most important in Africa; retention and training are tied for the top rating by respondents from South America.

Exhibit 2: Importance of human resource concerns (means) by region

This study confirms suspicions that a common set of shared problem impede the ability of hospitality leaders to manage effectively. The HR challenges mentioned in this study should be given serious attention by industry leaders, and their resolution viewed as an opportunity to think differently about how to address these problems. What HR issues will the industry face when it emerges from the current economic slowdown?

Rather than view key HR issues as an unchangeable fixture of the industry landscape, or unimportant in difficult economic times, now is the time to explore new solutions. To gain a sustainable competitive advantage in an increasingly challenging business environment, innovation in human resource management is needed. While some have come to accept the reality of low skills, high turnover and low morale, such as those in this study who worry and fret about how to improve their circumstances, perhaps it’s time for the industry to work together to make the jobs more attractive, the career paths clearer and investments in training more impactful.


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