In this case, the operating environment for Elite Hotel run in Azerbaijan is like that it is a newly independent republic country which formerly part of the Soviet Union and situated between Iran and Turkey. It is a lowly economic developed country but recently Western oil companies are looking for inward investment in the development of its oil and gas industry in this country. Therefore, there are plenty number of clients for the hotel and the local hotel can’t service these high level clientele. Thus it is worth to open an Elite Hotel in Azerbaijan. The hotel industry heavily utilizes labor for its daily operations. It is people-centric and thus HR practices are crucial to organizational success. Coupled with new regulations on labor, the hotel industry is a useful example to learn from, due to its high dependency on manpower. This answer aims to solve some of the key issues faced by the industry and specifically Elite Hotel, through which insights are derived from Elite Hotel’s HRM strategies.
THE MACRO OPERATING ENVIRONMENT:
The hotel will locate at the capital city Baku in Azerbaijan. This city has a cosmopolitan reputation in an overtly Muslim country which can be defined as a traditional male dominance society. Therefore, the hotel needs to take care and show the respect to the local culture. Moreover, this city often loss its power such as gas, water, electricity during daily living. In order to maintain the high quality service and seeking to expand, the hotel need to solve this power issue at first.
2. DOMESTIC LABOR MARKET AND EVOLVING EXPECTATIONS
According to the Trading Economics (2014), Azerbaijan has a high rate of unemployment at 5.2% in 2013. Hence, there are lots of well-educated people willing to do any kinds of jobs. Due to the strong competition for labor, hotels face difficulties in recruitment and retention, especially when hotel jobs are viewed as a high level wage payment. Therefore, to hire the local employees, the hotel must consider very carefully. Furthermore, this country also enforced a curfew, so if the hotel is seeking to expand, they must obey the laws and consider about the risk about the political instability.
1. TRAINING AND DEVELOPMENT
The issue of productivity has never been more pertinent than now. Elite Hotel will have to enhance productivity from a smaller pool of labor without compromising on service quality due to challenges in employment. Training therefore is needed to boost productivity and standards of service to meet customers’ expectations. In departments with peak and trough periods, training can be mixed- the waiters in the F&B Division can be trained as lobby hosts or even wine sommeliers. Another problem is that the employee may not be reluctant to be training and spend off-work hours on job-related tasks (i.e. lessons)
THE IMPORTANCE OF KEY HIRES
The importance of the first one or two hires is also a challenge. ‘I have long endorsed and applied the approach of finding the one or two key candidates. These are leaders who are respected in their present positions in the market, or who may have previously worked there, relocated for career opportunities or unrelated personal reasons in another market and who may desire to return or are willing to return for the ‘right’ opportunity’, according to Owen Dorsey(2011).
3. LOCAL VS. EXPAT
Some local candidates should be recruited since hotel may be influenced by its ownership structure which includes political or governmental factors geographically.
Increasing governmental pressures have been witnessed to create more jobs for local people so as to eliminate the dependence on foreign employees. In this case, Elite Hotel is planning to employs a total of 300 full-time staff across 7 departments for locals are cheaper than their foreign counterparts. It is good news to the hotel owners and also forces hotel management companies to think carefully when staffing a hotel. As Tim Williams (2013) addressed, “Do not hire expats as Resident Manager, Rooms or F&B Director unless you think they have the potential to push through to GM.”
4. THE WORKPLACE ENVIRONMENT
Elite Hotel faces other HR challenge pertaining to the local culture workplace environment and because of the culture in Azerbaijan is a traditional male dominance society. Therefore, how to balance the relationship between female and male employees is very important.
Q2. WHAT STEPS COULD BE TAKEN TO ENSURE THAT THE COMPANY MEETS THESE CHALLENGES AND WHAT PEOPLE CAN THE COMPANY DRAW ON TO UNDERTAKE THESE TASKS?
1. EVALUATION AND SUGGESTIONS FOR TRAINING AND DEVELOPMENT
It is of vital importance to ensure that employees are provided with knowledge and skills which aims to achieve a high standard of customer service. Elite Hotel needs to examine its 1) Training Needs Assessment, 2) Training Design and 3) Training Delivery. Under assessment of training needs, it is crucial to identify the training objectives and priorities – what KSAs (Knowledge, Skill and Ability) are needed in which department? How will task-specific KSAs evolve in the future as job descriptions change? In tackling the problem of unreceptiveness, Elite Hotel should focus on Training Design by analyzing Learning Readiness, Learning Styles and Learning Transfer, these which will eventually lead to effective learning.
Managers need to find ways to boost their employees’ self – efficacy and motivation to learn before effective learning can occur. As part of job-site learning, Elite Hotel can introduce job rotations. This broadens one’s experiences and knowledge of overall hotel operations. E.g. in the Front Office Department, an employee can be rotated to the roles of concierge, front desk, porter. This is effective in teaching employees the technicalities of various roles, and in the event of manpower shortage, productivity will not be compromised.
However, an employee might also be rotated away from a position that he excels in, resulting in underperformance in the new position. To mitigate this, Elite Hotel has to ensure that managers know the strengths and weaknesses of their staff. This aligns with its belief to “spend more time on people, educate them, counsel them [and] invest in our people”.
2. EVALUATION AND SUGGESTIONS FOR THE IMPORTANCE OF KEY HIRES
In this case, if the Elite Hotel wants to set up a new hotel of international five-star quality, they have to look for experts to improve their network. Hiring an experienced GM or HR Director in the market would be the decisive factor especially when they are in place the whole thing unlocks. After their join, the hotel could take advantage of their network to find out who they have worked with, who impressed them. That’s to say, the hotel may find potential clients. Nowadays typically a new brand in a new market may establish an executive committee which includes half internal hires and half external from the local market respectively.
3. EVALUATION AND SUGGESTIONS FOR LOCAL VS. EXPAT
With a very limited hotel supply, now the owners of hotel have to concentrate more on training. Michael Farrell, an Elite Hotel senior manager, argue that in some markets we are entering there is no local talent full stop, so we have to develop it. We put in a General Manager and HR Director with very strong training focus and put a lot into people development. Over time we can then export and develop that local talent further in our older hotels back in Europe so that they eventually return back home with a raft of best practices to share.”
4. EVALUATION AND SUGGESTIONS FOR THE WORKPLACE ENVIRONMENT
Enforcing that only the English language is spoken during work hours can address part of this problem. Elite Hotel also needs to manage relationships with NTUC, especially when active union members try to lobby for increased welfare and in particular, increased salaries. The hotel mavens, say, HR, need to study in the latest legislation and regulations, for instance, Employment of Foreign Manpower Act, Trade Unions Act and Work Injury Compensation Act etc. Moreover they have to keep learning professional knowledge through programs, courses and seminars.
Trading Economics, 2014,
Owen Dorsey. 2011, Tourism student perceptions of a travel agency career.
Tourism and Hospitality Research, 1 (4), 295 – 312.