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Introduction to Managing Human Capital
Managing human capital is about how employees are managed by an organization to meet specific objectives of the business. It is a process of recruiting and selecting people and developing them for improving their value in the workplace. The main functions of managing human capital are planning, organizing, directing and controlling human resources. The report is based on Hilton hotel of UK. It is the chain of hotels operating in more than 550 locations across six continents. This project covers important aspects such as history of the company and achievements of Hilton hotel. Further, the report also identifies the staff attrition rate in Hilton Hotel over the past three years. The current problems and challenges faced by human resource department in Hilton and impact of these issues in the organization are discussed. The solutions of various issues are justified with the suitable suggestions to Hilton. In further section, suitable theories and models have been used for the organization. The report also emphasizes on individual element of Managing Human capital in the organization.
History of Hilton hotel
It is started when Conrad Hilton bought his first hotel in 1919. The Conrad Hilton opened its first hotel with cold running water and air conditioner in the public room in 1927. After this, he started many services for their guest in 1947 to 1987. He installed first televisions in guest room in the Roosevelt hotel in New York City. Further, he also introduced modern day reservation system which is known as multinational reservation system. Hilton created its first special amenity for women i.e. a sewing kit and booklet with necessary telephone numbers. Hilton hotel offers for their guest room first brand-wide direct-dial telephone service. Then he opened its first airport i.e. Hilton hotel launched eforea spa in China, Thailand and the United States. In 2014, First hotel i.e. Hilton Times Square brand live stream a concert on YouTube. Recently, the hotel expanded its business in 100 countries and now it is operating in more than 550 locations.
Milestones achieved by Hilton hotel
The milestones achieved by Hilton hotel is given below
- The Hilton hotel generated revenue in 2014 more than 10.5 billion U.S. Dollars which is highest revenue in UK hotel industry.
- Light stay announces result in 2010 that the hotel has saved more than 74$ million in utility cost and it has decreased its energy use by 6.6%.
- Hilton hotel has become one of the multi-national organization to be certified, ISO 9001 certification for quality management and ISO 14001 certification for environmental management system.
- Hilton hotel has received award for best use of social media for Europe in the year 2015.
Industry position and key competitors of Hilton hotel and resorts
In 2016 ranking the position according global Forbes list Hilton hotel rank on 476 in worldwide(Forbes, 2016). The key competitors of mentioned hotel is Marriott International, Inc.,Starwood hotel and resorts and Intercontinental Hotels Group PLC.
No. of employee in above hotel
In the all Hilton hotels the Total number of employees is 164000(Forbes, 2016). and the attrition rate in hotel is high in over the past three years
What HR delivers and what business unit needs
At Hilton hotel, HR department’s role is to support the organization so that management would concentrate on the growth of business and instruct the employees accordingly to attain the set goals. There are many roles which HR department at Hilton Hotel has to play. Some of them are as follows:
Role of HR department is to recruit skilled employees, review the job description and assign the job according to their skill. At Hilton hotel, HR department also include compensation and benefits that are to be given to employees based on their performance. Along with that, it also includes keeping a close eye on wages as well as observing and controlling the division of labor among departments.
Morale and mentoring
HR department creates employee development program, for continued the growth of their employees. They also focus on employee’s development through mentoring and guiding them on different stages for accomplishing their goals. They also make a specific plan for staff members for providing directions in the areas where attention is needed.
At Hilton hotel, HR department is responsible to give training to employees so that they would provide better services to the ultimate customers. Through cross training, employees get opportunities to work on multi task. Along with that, training helps employees in improving their skills by which they can work more efficiently and effectively for hotel.
HR department delegates the workload among experienced and skilled staff. Different culture customer come in organization. Staff are required to make their customer comfort by giving them room service or any other facility they want in their hotel.
List the challenges and give brief explanation of the issues
HR department not only hires new talent for Hilton Hotel but also make initiatives to retain the existing talent in organization. In the present scenario, it is one of the major challenges to make employees stay in the firm in the long run. HR manager’s responsibility is to protect the valuable assets of firm, that is, human resources. Hiring and retaining the best employees is the biggest challenge for HR department.
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At Hilton hotel, employees sometimes get demotivated due to heavy workload. To keep the workforce motivated to perform their jobs effectually is another challenge for the hotel. In this case, HR manager required to motivate their employees so that they can perform their best for the hotel. Employee motivation is also a challenge for business because their performance affects the overall development of organization.
This is another issue faced by HR department at Hilton hotel. Leadership is also associated with employee retention; hence there should be proper emphasis on strategic leadership. Employees at Hilton hotel generally leave their job because of poor leadership. They require an active and supportive leader who can guide them at the time when they face any problem and also motivate them toward their work. Effective leaders set targets and motivate employees for achieving them in the specified manner.
People from different backgrounds come in organization and thus, they all possess distinct personalities. When employees from different culture work together, chances of conflicts may arise because they all would have different opinions regarding a specific issue. In this situation, it is important for HR management to have effective communication with employees so that they can share their problems with him easily and issue can be resolved.
In Hilton Hotel, lack of technical talent is one of the challenges for development and growth of business. Advanced technology is being used by the hotel in order to sustain in today’s competitive environment. If employees are not skilled or if they would not adequate knowledge of new technology, then productivity of firm will get affected as well as cost would also get increased.
Discrimination and diversity
When discrimination is made in between employees, it affects the workflow of firm as it increases the chances of conflicts among workforce if one would feel that partiality has been done with him. By this, employee would get demotivated and not work hard for their business or there may be chances that they would leave the firm. Thus, discrimination should not be there in the hotel on any of the basis.
Flexible work arrangements
At Hilton hotel, it is necessary to have flexible work arrangements for employees. It will allow employees to work with higher efficiency as in a healthy and positive working environment, they can perform in a better way that will increase the productivity of business. For this purpose, working hour for employees should be flexible so that they can manage their work within specified duration effectually.
Consequences that happen (internally or externally) if actions is not taken
At Hilton Hotel if actions are not taken, internal consequences can be as follows
Delays in production
At Hilton hotel employees are not skilled so they cannot complete their work on time. This creates delay in production activities. This delay also lead to decrease the demand of customer. If customer demand not met on time, it will also effect the sales of the company. Labor are important for manufacturing process may be the causes of delay in production for example vacation taken by employee affects the production. It also depends upon the supplies of raw material from outside sources. Some problems are of transportation or inclement weather. Time is taken to adopt new technology for business purpose. Then also required to hired skilled worker or either give training to their employees. These all are the reason for delay in production of business. Organization required to hire more employees for production so if in absence of any employee they can manage their work and there will be no delay in their work.
Business performance drops
Performance of business will drop because of many reason. When employees will not perform according to the demand of customer. If employees not used technology in proper way. If they delay in providing their services to customers then customer will get dissatisfy it effects the overall performance of organization. At Hilton hotel if the room service is poor business performance effects. Different culture of people come in hotel, if service are not provide to them according to their culture they feel uncomfortable. They will feel that employees of hotel have no respect for any culture.
Unskilled employees will also be a reason of unsuccessful business because if employees don't provide better service to customer they get hurt and not like to come in their organization. For example if customer in hotel treated not well by staff members or employee misbehave with customer they will not like to come their again.
Lose market share
Market share can be loss if business face any losses because of many reason like if customer will not want to stay in their hotel. Customer will not like to visit their if they not get good service from their employees. When hotel condition is not well or they cannot invest in their business. There are many competitor in the market, so they will lose their shares if they cannot compete with them. For increasing market share business need to increase the productivity. Invest on improving the hotels room and services and make their hotel luxurious. So that customer wan to visit their again and again. It is necessary to differentiate their hotel form other competitor it can be done by offering free HBO 3.00pm checkout are just a few possibilities. Hotel should have a policy where they are near to the lowest rate in city.
At Hilton Hotel if actions are not taken, external consequences can be as follows
At Hilton hotel if employees will not well trained they will give poor service to their customer. Angry or frustrated employee can destruct the business. When employees personal life is in crisis or out of control, then their negativism and aggression will attempt toward the customer. If employee of company not provide correct solution to customer problem they will get dissatisfy. It is necessary to provide constant feedback on what customer feel in their hotel, customers view regarding their services (Ulrich, 2013). This all the reason of poor services. Action are required to be taken for improving the poor services are proper training facility to customer so that they win the trust of the customer. Tourist come from across the country should provide facility according to their culture and should show respect to their country. So that they feel happy and feel like a home. Make your employee happy by paying them according to their work and incentive on their extra work, they will get motivate and work with more effort for their company.
Reduce Customer loyalty
When hotel no longer able to retain their status in market then for longer periods. Then loyal customer base will easily disappear with the time. At Hilton hotel if employees no give service according to customers needs, then they will move toward the other organization. When business will fail to keep up with customer exception it decline the customer loyalty (Zarutskie, 2010). Customers don't care that service provided to them are better then a year ago. At Hilton hotel fail to focus on the customer experience then it effects company, because they have no idea that customer are satisfied or not. If the image of marketing and promotion of the company is quite different from reality,for example like if they advertise of any special; service for customers or they will give discount but in reality they don't provide such services. Then customer will not believe on them any more.
Poor brand perception
when customer get negative information of their hotel, because of many reason like continuously falling in market shares effects the brand of their hotel. People will think negative about their business. Customers will not like to book their room in that hotel. Hotel not provide luxury service to their customers then no tourist like to stay in their hotel. Action are required to be taken of for improving the poor brand by selling hotel branded products (Haynes, and Hillman, 2010). For example, by accidentally pack a couple of towels in their bag before they check out. It may make customer happy and they like to visit again in their hotel. Poor brand perception are required to improve for increasing market shares of business. Employees are required to give some free room services and discount in hotel for increasing the sales. If company sales increase then overall profit of company will also increase. Then they can improve their brand image and can be stable in market for longer period.
Importance of staff engagement in order to sustain or for performance Management
The importance of staff engagement is that because it is based on trust or integrity and communication between organization and its human resource. It is an approach to increase their organizational growth, contributing to individuals, increase productivity and well-being. It is important because its about understanding individuals role in organization and energised in where the individuals fits in the business purpose and goals to achieve objectives.
Employee engagement is about being involve as a member of team, focused and clear goals, empowered and trusted, receiving regular feedback, supporting in develop new skills, recognised for their achievement. This helps to organization is that they feel comfortable at workplace and give full effort to achieve goal.
It is about positive attitudes and behaviours which leading to improved and increased organization outcomes, in a way that they trigger and learn one another. It is important because the organization employees feeling pride and give loyalty in working for its organization. It is important to reduce conflict and grievance between employees and employers and increase productivity. The employee engagement helps to individual that is they motivated and feeling worth of own in its organization.
Use motivational models and concentrate on change management or the team that will bring about change
Benefits of Maslow hierarchy theory in change management:
According Maslow model every employee wants fulfil their five needs i.e physiological needs, safety, self esteem, self actualization and belongingness. According to them the organizations motivated through fulfilled these needs of employee. According Maslow , if organization fulfilled their basic needs i.e food, job, sleep or feel secure. This basic needs beginning of motivation of employee after fulfilled they feel give more efforts in organization.
After this the second need of employee is belonging needs i.e the need of feel part of organization or need of acceptance if organization motivated though fulfil these needs then the employee feel comfortable at work place and feel part of group, so they give more efforts to achieve objective and goals. Furthermore,the needs of self acclimatization and self esteem i.e feel good about themselves, recognized for their achievement, need for personal fulfilment and the need of grow and development. If organization motivated through fulfil these needs that they recognized for their achievements and gives opportunity to development the the employee then they feel proud for the part of organization and doing work more efficiently. The last needs is safety, if organization motivated through fulfil their safety need like pension, job secure etc. these needs helps to retain employee in long term. The motivation models help to change organization management culture and structure.
The barriers in change and funding of resources
The barriers in change is that sometimes employee not adopt new technologies because of untrained employee. To remove this barrier the organization gives training to employee to understand technology. The barriers in change is that proper number of resources are not available in organization. The number of resources are available through more funding in organization for resources and minimum utilisation of resources The barrier of untrained and unskilled people. This barrier remove to gives proper training to employee and recruit suitable employees for organization. The funding of resources and sponsor responsibility is manager duty.
The resource implications about resource adequacy
In Hilton hotel they provide training through expertise people for adopt technology and understand workforce. They provide proper resource to workforce to doing effectively and efficiently working at work place. They retain highly capable employee in long term time And recruit new employee to reduce turnover and attract suitable employee for organization. To retain and attract best employee in organization they motivated through fulfilled their needs. They retain employee though gives rewards. The organization gives development opportunity to best candidate to retain long term. The organization gives appreciation for achievement of employee through these employee retain in long term.
According to Michael Armstrong(2008), human resource management is a strategic and rational approach to manage organization most valuable assets i.e human resource. The people who are working in organization, individually and collectively contribute their efforts in achieving business objectives.
Cross culture management
In International business, managers are understand that that the success factor for improve employee performance in economic system is organization culture. When planning for new foreign enterprises, employers select the best employees who are best suitable for new business. It is a crucial factor for business that when new enterprises started to interact with different nationalities, values and belief of employee is create issue to understand organization culture. It is not acceptable in foreign enterprises to expect that members of different culture and values will understand the main objective of the message.
Greet Hofstede culture dimensions
The professor of Maastricht university, Greet Hofstede conducted study that how value differences in the workplace influence the organizational culture. Hofstede creates a model that identifies five dimensions to understand and assist the differences of culture i.e. power distance, individualism, masculinity, uncertainty avoidance and the long term orientation.
Power distance measures the employees needs and preferences in the ways to interact with their managers and supervisor, subordinates and peers. The issue here is that the ways a society handles inequalities among people. According to Hofstede, it is evidence that the employees performance is much better when it fits their preferences at workplace. So the organization needs to understand employee preferences and fits their preferences into system. This dimension describes the relationship between managers, bosses and subordinates. When the power system is high, employees communicate Little to their managers and bosses. If low power system in organization culture then the employee more communicate with their superiors in decision making process.
According to Hofstede, individualism represent the relationship between individual or loose. The individualism word describes as a political, moral and the importance of employees self- reliance and liberty. This dimension promote the unrestricted efforts of individual objectives and desires. Furthermore, the opposite meaning of collectivism where enterprise concern into employees family matter. The word collectivism about group of people who are strong and cohesive in team.
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Masculinity is also called assertive pole as they are competitive from one country to another. According to Hofstede, the femininity working as the opposite pole of masculinity, it is concern about “ caring and quality of life” thus its called caring pole. When women working in feminine countries they have same worth and caring value as men. If women working in masculine country then they are still competitive and impressive, but not as much as men. So if both dimension arrive to similar dimension country then this happen. These countries show a differences between men and women values.
Uncertainty avoidance indicates that the individuals to which the employees of enterprises feel comfortable with reduce risk and ambiguous future. The issue here is the ways of enterprise deals with the fact that the future can never be known so the enterprise control the future through many process. In countries strong UAI enterprises maintain rigid codes of values and belief and weak UAI enterprises maintain a more relaxed attitudes and beliefs.
According To Hofstede, long term orientation includes that the many enterprises maintain some links with its own past to dealing with challenges of the present and future.
According to Abraham Maslow, The people are motivated to achieve certain personal needs. When one need is fulfilled a person look for another need and fulfilled the next one. The Maslow's stated five motivational needs in hierarchical theory i.e physiological needs, self esteem, safety, self actualization and belongingness. These needs of every employee in organization. The organizations motivated employees through fulfilled these needs according their wants. The physiological needs are basic needs of people so the needs are motivated people when they are unmet. After basis needs fulfilled the employee wants to fulfil their higher growth needs. Once these needs fulfilled then want to achieve highest level of needs i.e self actualization. Maslow analysed that only one in a hundred people fulfilled their self actualization needs because in enterprises rewards motivation commonly based on esteem, love and other social needs.
From the above report it can be concluded that HR plays important role at Hilton hotel. They delivers best service to their customer by providing training facility to their staff. Manager focus on the employee need and their satisfaction. There are many challenges faced by HR like they need to motivate employees, hire a good quality leader for giving direction to the employees. HR are required to provide better service to their customer. Internal and external consequences on business are providing poor service to customer. Performance of their company will fall. Their will be delay in production it may decrease the demand of their sales. Action are required to be taken for improving their brand image and for gaining the trust of employee.
further it can be concluded that Maslow theory is useful for motivating the employees. Cross culture model shows the effects of different religious people in organization. Employees get benefits from the motivation theory.
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