Aditi Mam Final Assingment

8/2/2019 Aditi Mam Final Assingment

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HRM Case Study and Suggested Solutions

Beachside hotel human capital dilemma

This is a case of two competing hotels, Sunrise Hotel and Beachside Hotel

that are both located in a medium sized, tourismbased town in the

Northeast U.S. The hotels are both competing for the same set of guests,

as well as the same set of potential employees. They are both budget

hotels, right next door to each other, with 60 guest rooms each and a view

of the beach. The occupancy during peak season for the Sunrise Hotel is

98%, but during the winter months goes down to 65%. The Beachside

Hotel has peak season occupancy of 90% and off peak occupancy of 50%.

Joe is the General Manager of Sunrise Hotel and has been in his current

position for 5 years. He has been with Sunrise Hotel for a total of 10 years.

He worked his way up at Sunrise Hotel from front desk agent to front desk

supervisor, and finally to Assistant General Manager before he became the

General Manager. He does a good job of screening potential employees for

his front desk area of the hotel because he realizes the importance of that

area of the hotel, especially in tourist areas. He also has incentives set up

for excellent performance of the front desk agents and training and

development programs designed to give everyone information that will help

them do their job better. There is a sense of teamwork at Sunrise Hotel and

that helps everyone want to do a good job. His guest satisfaction ratings

for his hotel are overall excellent. On a rating

scale of 110, his hotel averages a 9. The average length of tenure of his

employees is 4 years, and his current front desk supervisor was promoted

from within, along with his Assistant General Manager. Because of the

small size of the hotel, Joe is actually involved with all of the hiringdecisions and helps to give training programs himself,

along with his leadership team. The employee turnover

at the Sunrise Hotel is 25% overall and that is primarily when

hourly employees graduate high school or college and leave

the Sunrise Hotel for a career somewhere else.

Brian is the General Manager of the Beachside Hotel and

deals with a very different situation. Brian was brought in

from another hotel in the same hotel group about 6 months

ago. He was told by his boss that he needed to fix this hotel


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so that it would start having better customer satisfaction ratings

and more return guests. Despite the fairly high occupancy

noted during peak seasons, the off peak season occupancy is

only 50%. Also noted by his boss, the occupancy should be as

good as the Sunrise Hotel. Brian has been with his hotel group

now for 2 years and he came out of the accounting and finance

department in his old hotel. He has a great understanding of

the numbers in the lodging industry, but has not been involved

with the human resource aspects of the job.

The turnover of hourly employees at Beachside Hotel is

120% and that means that Brian is constantly running the hotel

short handed and with new employees. The Beachside Hotel

has been doing the hiring through a human resource practitioner

in the hotel that was put in the position because she

really could not handle serving guests at the front desk very

well. Mary was promoted to human resources a year ago after

she had one too many altercations with the guests at the front

desk. The owner of the hotel wanted to make sure that she

would not make any of the other guests angry, so he promoted

her to a human resources practitioner. Since that time, she has

been busy trying to keep up with hiring and she has had no

time for training employees. Because she is so busy, paychecks

often come out to employees late, there are no policies written

down for employees to use as a guide for performance, customers

are treated badly by new and poorly trained employees,

and the departments of the hotel do not communicate

very effectively and therefore everyone blames everyone else

when things go wrong.

The average length of tenure of the front desk agents at the

Beachside Hotel is 3 months and the customer satisfaction rating

at the Beachside is a 6 out of a 10 possible rating. Most of

the front desk agents that are hired come from other hotels in

the area after they quit or are fired. Brian is not involved in the

hiring for the hotel at all, and does not get involved with training

and development. He spends most of his days looking atthe financial reports for the hotel and analyzing average daily


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rate, occupancy rates, and REVPAR.

Brian knows that he has many problems to deal with and so

he goes to the Sunrise Hotel to observe things over there for

a while. He sees a happy crew and talks to Joe about how he

is making that happen. Joe is happy to help, but wants Brian

to go back and observe his employees first and come up with

ways that he specifically can help guide Brian.

Class or small group discussion questions

1. What systems should Brian implement in order to start

changing the human capital practices in the Beachside

Hotel?

2. What could Brian learn from Joe in terms of the human capital

aspects of running a hotel?

3. How could training and development programs be implemented

in the Beachside Hotel in order to help with turnover

and occupancy rates at the hotel?

4. How could a return on investment perspective help or hurt

the Beachside Hotel in trying to compete with the Sunrise

Hotel?

5. What other human resource initiatives could be undertaken

by either the Sunrise Hotel or Beachside Hotel in order

to help with the overall performance of their respective

organizations?

This case study gives many examples of issues that could be

improved upon in order to help with the human capital performancein the Beachside Hotel. The Sunrise Hotel offers many good practices

that help to ensure a return on investment in their human capital

practices. The low turnover, length of service of employees, and the

positive ratings regarding guest satisfaction all point to the positive,

human capital focused culture of Sunrise Hotel. The above questions

give some discussion points that will help to focus students

and practitioners on some of the positive actions that can be taken

by Beachside Hotel to help improve performance and the tone of the

company. Here are some partial solutions to the case study questions.


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1. In order to start changing the human capital practices at the

Beachside Hotel, there needs to be a serious shift in the culture

there. Since Brian did not have any human resources background,

he does not get involved in hiring, training, and ensuring that

these functions are used to build a stronger service culture. Mary,

the HR practitioner, was put into place because she could not work

with customers, yet she is now in charge of the internal customers

in the organization, the employees. Brian needs to get involved

in building a stronger culture by making sure that he works with

Mary to make sure that she is focused on people and creating a

positive atmosphere. Investments need to be made in training and

development of the people currently employed at Beachside Hotel

and also in the new people to build a committed workforce.

2. Brian should start out by learning more about the human capital in

his own hotel first and getting himself immersed in the people of the

company. The service profit chain starts internal to the organization

and then looks to the external guest. Brian could then observe

some of the human resource practices that are being used at the

Sunrise Hotel and apply them to his own hotel. Joe gets involved in

all of the hiring at the Sunrise Hotel as well as the training there.

Brian should implement more of a focus in the top management of

Beachside Hotel in order to emulate Joes focus on developing a culture

of service and in taking pride in the people that work for him.

3. Brian needs to focus on hiring the correct people for the various jobs at the

Beachside Hotel and should then work with each person

to determine what it would take to get them to be satisfied in their

jobs. Training and development not only give people the skills

that they need to be successful in their jobs, but also they help to

develop people in other facets of their life, i.e., time management

skills, money management skills, and even tuition reimbursement

for college classes. These development classes help people feel

a sense of connection with their jobs and would help them to besatisfied in their overall lives. The more satisfied employees are, the

more that they tend to stay at a place of employment and the more

they tend to satisfy the guest that they serve. Having the top management

in a company get involved with the training and development

of their people, helps them commit to their future growth and

helps the employee feel that their employers believe in them.

4. Since Brians job is to fix the Beachside Hotel, there will need to

be an initial investment in order to get the human capital practices

to a point where there are some significant improvements. Theseimprovements will hopefully drive the service level up at the hotel


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and thus drive occupancy and repeat customers. There needs to be

a return on investment focus for the hotel as they try to change the

culture. It appears that currently, there is not a focus on investment

in human capital at all and the cost is the low customer satisfaction

scores, high turnover, and a lack of repeat guests. This

hotel needs to encourage a focus on the human capital areas as well

as focusing on the return on investment in this area. It needs to be

noted that the return on investment may take a period of time to

show a positive return, but hopefully the effort will be worth it.

5. Some of the other human resource initiatives that could be undertaken

by either or both properties are: regular and thorough performance

reviews, 360 degree feedback programs, round table

discussions with employees to focus on their needs, incentive programs

to reward employees for positive performance toward the

objectives of the organization, offer reward programs for guests inorder to boost the level of repeat guests to the hotels, more open

communication regarding progress toward the goals of the organizations

in order to keep employees in the loop regarding performance,

top management needs to focus on having a focus on the

service profit chain regarding the internal guest satisfaction as

well as the external guest satisfaction.

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Aditi Mam Final Assingment