Economic Slowdown Implication on HR-Hotel Industry

7/29/2019 Economic Slowdown Implication on HR-Hotel Industry

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Economic

Slowdown:

Implicationson HR

Practices

HotelIndustryXXXXXXXXXXXXXXXXXXXXXXXXXX

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Economic Slowdown: Implications on HR Practices Hotel Industry, March

2

TableofContentsIntroduction 3

Literature Review 6

Paper 1: Dimensions of HRD Climate enhancing organizational commitment in Indian

organizations. 6

Paper 2: Linking Corporate Strategy and HR Strategy: Implications for HR Professionals 8

Paper 3: Managing Human Resources in a Global Downturn, 9

Paper 4: Hospitality HR Leaders make Metrics Central to Strategic Performance Management 11

Background of the sector 13

Qualitative Analysis 16

Quantitative Analysis 18

Conclusion 27


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Introduction

Human Resources can be defined as employees in an organization, who work to increase the

profit for the organization. Human Resource Management and Development can thus simply bestated as the process of allocating people as per their competencies and helping people to acquire

competencies. Abraham defines organizational climate as a set of characteristics which are

referred in the descriptions employees make of the policies, practices and conditions which exist

in the working environment.

The HR climate consists of the organizational structure as well as the organizational culture.

Importance of looking at the organization climate is:

Looking at the organizational climate means taking a closer look at what is happening in

and around in the HR scenario of the various organization. It is essential to work upon

because directly or indirectly this environment affects the organization and the employee.

Environmental factors of HR are prime influencing elements of change in HR strategy.


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It gives HR professionals time to anticipate opportunities in HR area and time to plan

optional responses to these opportunities.

It helps HR professionals to develop an early warning system to prevent threats emerging

out from HR scenario, or to develop strategies, which can turn a threat.

It forms a basis of aligning the organization strengths to the changes in the environment.

It enables the entry of the latest national/international HR developments.

A major part of the climate is dictated by the HR policies and practices followed by the

organization.

HR policies and procedures are introduced to offer a fair and consistent approach for managing

the human resources.

Some of the policy or practice areas those are crucial to effective people management and

development:

recruitment and selection

training and learning/development

career opportunities

communication

employee involvement

team work

performance appraisal

pay satisfaction

job security

job challenge/job autonomy

Work-life balance.

Not all policies and procedures will be relevant to all organizations, and some policies arerequired by law while others are to promote good practice.

The survey conducted by us encompasses the effect of the current economic slowdown on HR

practices and their impact on employees. In order to obtain a focused analysis, we have limited

the survey to the hotel sector.


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Within the sector, we have obtained responses across different management levels.

Our rationale to pick the hospitality sector is that this is one such sector that gets affected by the

economic downturn gradually. Also, although developers of the industry believe this is the right

time to invest and build, as your property becomes ready at the time of the upturn, it is difficult

for them to finance the project. This situation brings about a lot of pressure on employees to

perform, in terms of the bottom line and also incur capital expenditure.

The survey is thus conducted to gauge the reactions of the gradual economic downturn pressures

on the employees and their organizations.


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LiteratureReviewPaper 1: Dimensions of HRD Climate enhancing organizational

commitment in Indian organizations

(The above article was published in the Indian Journal of Industrial Relations published on 1st of

April, 2008.)

Researchers and scientists have always stated that along with the commitment level of

employees a congenial climate within the organization is equally important for the achievement

of its ultimate business goals.

The present paper measures HRD Climate in terms of various dimensions like Participation,Succession Planning, Training, Performance Appraisal and Job Enrichment and its relationship

with the Organizational Commitment of managers.

A study was conducted in 5 organizations with sample size of 247 middle level managers in

order to establish a positive relationship between the climate of an organization and the

performance and commitment of managers. There was correlation and regression analysis

conducted to study the effects of HRD climate on organizational commitment.

Every organization has its own traditions, practices and culture, which together comprise the

climate for its members. While studies have related Organizational Climate perceptions with

Organizational Commitment (e.g., Mc Murray et al., 2004; Hanges et al., 2005 Mishra, 1992)

research has not related employee perceptions regarding HR practices with their organizational

commitment.

This study highlights the role played by various HR practices in improving commitment and

reiterates that it is imperative for HR managers, striving to build a workforce committed to the

organization, to formulate policies and practices that are perceived positively by employees. It is

also relevant to study the relationship in the context of Indian organizations, as the HR practices

have undergone changes post liberalization. There has been a paradigm shift in the HR's role

from mainly labor and pay-roll management to a critical component in achieving organizational

goals.


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Organizational Climate refers to the "perceptions that organizations' members share the

fundamental elements of their organizations".

The paper focuses on climate perceptions through different approaches:

1. Structural Approach

2. Selection-Attrition-Attraction Approach

3. Cultural Approach

At the individual level, climate is the summary perception of the organizations work

environment providing a common frame of reference for attainment of some congruity between

behavior and the system's practices and procedures, acting as a potent influence on individual

performance and satisfaction.

The structural approach proposes that characteristics of organizational structure influence climate

perceptions. This approach does not deny the influence of individual characteristics but it gives

primary consideration to structural factors. Climates should therefore change from setting to

setting.

The selection-attraction-attrition approach states that individuals seek and are sought out by

organizations to ensure a certain match between the individual and the organization. The process

of attrition improves this match, in which individuals move (quit or transfer) to affect better

person-organization congruence, or the organization takes remedial action to deal with initial

mismatches by means of termination or transfer. The selection-attraction-attrition process

highlights the role of HR practices in defining the Organizational Climate. It results in the

organization being constituted of distinct personalities that are responsible for "unique structures,

processes and cultures that characterize organizations'. The organizational leadership also

encourages specific policies and practices to achieve specific organizational goals, which give

rise to unique structures, processes and cultures within the organization.

A newer approach to Organizational Climate is the cultural approach, which proposes that

Organizational Climate arises from the inter subjectivity of members as they interact within a

context established by an organizations culture. A definition of Organizational Climate can then


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mean that it is the way in the organization by which deep structures of the culture are manifested

in the interplay between situational contingencies, interacting group members, and ultimately

culture itself. The climate then operates at levels of attitudes and values, while culture operates at

these levels as well as at the level of basic assumptions.

The paper concludes that organizational Climate has been found to be a determiner of an

organizations ability for sustaining high performance. It provides levers to form an integrated

people's strategy that shifts performance and the necessary tools that enable employees to do

their jobs properly. Studies linking climate and performance claim that when employees perceive

greater involvement in decision-making, information sharing and management support as

favourable it results in greater corporate effectiveness.

Paper 2:Linking Corporate Strategy and HR Strategy: Implications for HR

Professionals

(Rishikesha T. Krishnan, Associate Professor of Corporate Strategy, Indian Institute ofManagement Bangalore, in Emerging Asia: An HR Agenda, New Delhi, 2005)

Today HR has become more of a strategic function rather than just a support function for the

businesses. Thus it plays a very important role in achieving business objectives through careful

planning. The importance and role of HR managers has become significant for companies who

value their employees and realize the underlying importance of people in achieving sound

bottom-line in the longer run. The paper mentions several examples of companies that have

integrated their human resource strategy with their corporate and business strategy to create

inimitable capabilities and drive competitive advantage for them. For e.g. Nucors competitive

advantage is based on cost leadership. It achieves this through all the four building blocks

efficiency, quality, innovation and responsiveness. To keep costs down, it has very few layers,

all managers travel by economy class, and even frequent flier miles are used by the company.

Another company that has matched its business strategy to its human resource strategy is the

Lincoln Electric Company. These companies worked on cost leadership as their strategy. For

companies competing on differentiation plank the human resource strategies are more complex.


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As for the hotel industry, the human resource strategy has always been revolving around the idea

of recruiting skilled resources from the market, training them as per the need and retaining them

for the long run. Thus recession does not seem to have much of effect on the peoples job in the

industry.

Increasingly, questions are being asked about what value the business group adds to each

individual business. Most groups have focused on HR as an area for change. Some groups like

the Tatas recognized early that HR initiatives were a powerful way for the group to create value

the creation and running of the TMTC; the Tata Administrative Service; support for XLRI etc.

Hotel industry is a sector where people are the core of the business, it being a service industry.

Thus here is the hospitality of the people which matters to the guest as equivalent to the physical

facilities provided to the guests. During the times of current recession the job equation hasnt

changed much for the employees in the hotel industry except for some 5 star hotels. This sector

has always experienced a lack of skilled labor, thereby forcing the players in this area to retain

the employees for longer term. The employees are recruited and trained so as to fill the supply

chain gap in this area. Thus the human resource strategy in this industry has been aligned with

the business strategy of maintaining long term relationship with the customers. This aligns with

the strategy of consulting companies like McKinsey and Company where people are at the core

of value proposition. Also McKinsey puts a great emphasis on the credibility and integrity of it

performance measurement and feedback systems thus creating a highly skilled workforce ready

to offer best in class solutions to their customers with a view to have long term relationship with

them.

Paper 3: Managing Human Resources in a Global Downturn

(David Bartlett, Economic Advisor, RSM International, J anuary 2009)

The sharp rise in worldwide unemployment rates resulting from the economic downturn has

diminished the urgency of the global war for talent, as corporate managers undertake mass

layoffs and workers focus on job security. The long-term structural factors driving the

competition for human capital, however, remain unabated amid the recession: Globalization,


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demographic shifts, technological advances, shortages of skilled professionals, entry of

Generation Y persons into the work force. Nothing in the current economic downturn indicates

a diminution of these long-term drivers of the global labor market. Companies that succumb to

short-term disruptions will be poorly equipped to cope with these structural changes in the global

labor market, while enterprises that strengthen their human resource capabilities during the

downturn will be well positioned when the world economy recovers.

The human resource profession is undergoing a transition from the tradition model of HR

management (which focuses on administrative processes) to a New HR paradigm that

emphasizes the strategic dimensions of human capital management. The new model of human

resource management demands HR professionals who possess an understanding of the role of

human capital in corporate strategy, a capacity to navigate a complex and diverse global labor

market, and an ability to engage young employees who bring different values and expectations

than their predecessors. Effective human resource management also requires the active

participation of senior corporate executives who can identify rising stars in the organization,

mentor aspiring leaders, and transcend organizational turf battles that encourage divisional

hoarding of talent.

In times of the global recession, investments in human capital are not likely to be a high priority

for companies whose very survival is threatened, but for companies with strong balance sheets

and compelling business models, the economic downturn presents important opportunities to

strengthen their HR management capabilities and position them for the inevitable rebound:

Utilizing slack time to engage employees in professional development and technical

training programmes, which serves both to sharpen skills and to preserve morale during

tough times

Opportunistic hiring of talented individuals caught in downsizing at weaker

enterprises, which augments the companys human capital base for long-term growth

Promoting cross-divisional and cross functional collaboration, which improves

utilization of human resources and encourages teamwork between employees who

previously had little or no contact


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Redefining and expanding spheres of authority and responsibility of star employees,

which permits assessment of the leadership potential of individuals who may eventually

occupy executive positions in the organization

Even robust companies cannot avoid layoffs in the current recession. But skillful management of

the downsizing process (e.g., generous severance packages for departing workers) strengthens

the companys image and thus bolsters its capacity to attract talent employees when the economy

rebounds.

Paper 4: Hospitality HR Leaders make Metrics Central to Strategic Performance

Management

Debate centred on the industry wide talent shortfall and the use of metrics to establish

opportunities in response to this issue. The experiences shared illustrated that HR metrics are

widely used to recognize key indicators in business performance. The use of HR metrics has

evolved from just being a dashboard (where HR leaders decide what to measure and report on) to

highly strategic and sophisticated measurements that drive organizational and business

performance.

In the increasingly competitive business environment and the intensifying war for talent in the

hospitality industry across Asia, and in spite of these challenges, HR leaders in the industry are

getting closer to the Holy Grail of HR metrics that drive their companies' strategic performance.

The group concurred that the chief responsibility of the HR team was to deliver additional

workforce at all levels, whilst simultaneously maximizing the capacity of the current workforce.

There was a correlation between employee satisfaction and guest satisfaction and that

determining employee engagement and well-being required consistent monitoring.

Metrics add credibility to the human resource function in terms of quantifying and qualifying

business goals.


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Skills Shortage: There is a requirement for analytical skills within the HR function itself,

however many organizations borrow that skill from other departments. There needs to be a shift

in the talent mix planned for future recruitment drives to accommodate the lack of essential skills

in the modern HR environment. Succession planning was identified as a key contributor to

strategic growth and for the continuation of high quality standards for customer service levels.

The Lack of Talent: Most organizations face a similar shortage of available talent at all levels in

the workforce, particularly in management and leadership roles, mostly due to aggressive

expansion strategies in the region. New graduates deem the unsociable hours and perceived lack

of opportunity in the hospitality industry as unfavourable. Therefore the hospitality industry is

losing out to industries such as information technology, business process outsourcing etc.

Long term outlooks enable HR managers to predict and plan for specific areas of talent shortfall

and to adopt management training programs to prepare for the demands of future growth.


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BackgroundoftheSector

The hotel industry is a $61 billion dollar industry that is fueled by an ongoing need fornourishment. It consists of budget, limited service, full-service and luxury resort properties

throughout the world. This industry strives on achieving the highest Average Daily Rate and

Occupancy to maximize revenue and reduce operating costs to improve net income.

Indias strong GDP performance in the recent past, strengthening of ties with the developed

world and the opening of sectors of the economy to private sector/foreign investment, fuelled the

growth of the hospitality sector. Significantly, the bulk of international arrivals into India, both in

2004 and 2005, have been business travelers. Furthermore, Indias growing recognition as an

exciting place to visit (The Readers Travel Awards 2006, conducted by Cond Nast Traveler

had placed India at number four among the worlds must-see countries) has helped boost its

image as a leisure destination. TheIncredible Indiacampaign has also been a huge success.

Key Economic Indicators and Tourism Statistics, 2006

Domestic demand for hotels in India is much higher than demand from foreigners and much of

the domestic demand tends to be business related. However, with liberalization and an overall

improving economy, an increasing number of Indians had started taking annual holidays, both

within the country and overseas. As roads and other infrastructure developed, the requirement for

these hotels in secondary and tertiary cities was expected to increase significantly. A number of

international brands across all hotel segments also entered the Indian market and domestic hotel

chains embarked on strong expansion and development plans.


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Key Operating Characteristics by Hotel Classification Occupancy

The addition of many new hospitality products, and a much larger and more sophisticated hotel

industry in India brought with it a new set of pressures. After competing to raise occupancy and

average rate, hotels started vying with each other to capture the best talent. Hotel managers are

acknowledging the short supply of quality manpower to be the biggest obstacle they face. The

balance of power is steadily shifting from employers to employees. The addition of even one

new hotel in a city seriously impacts the HR equilibrium of existing hotels with similar market

orientation.

Salaries for the managerial level took a quantum leap, anywhere between 60-100%, in practically

all hotel companies in India till 2008. This allows lesser number of managers to be lost to other

sectors owing to purely financial reasons and also allow more Indian companies to be able to

open the gates for expatriates for key positions. While a crunch for managers is still felt, the real

challenge emanates from the supervisory/ junior management positions. It takes around 3-4 years

to prepare people at this level because of the skilled nature of the job and its accompanying high

service orientation index.

Various surveys and interaction with the HR heads of various hotel corporations in India reveals

only about 20% of new hotel management graduates are deemed employable. The rest is

absorbed by an erratic mix of budget hotels, unbranded hotels, QSF restaurants, food service,airline and the BPO sector industries. Thus, the industry had not yet fully realized the magnitude

of the problem that is, and during the recession the hotel companies are further expected to

motivate and provide job security so as to retain the trained employees working in managerial

positions.


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The Hotel Sector mainly includes Hotels, Resorts, Sanatoriums, Destination spas, Inns, Hostels,

Motels and Service Apartments. For our survey, we have been able to cover high end hotels,

budget hotels and service apartments.


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QualitativeAnalysisIn addition to the facts that came out from the questionnaire, we got some insights about the

prevailing HR Practices in Hotel Industry even from conducting interviews in general.

For example at 5-star and above hotels like Taj, Marriott and Grand Hyatt, human resource

policies have undergone some changes on the front of hiring i.e. labor force in terms of waiters

and entry level employees which were taken in high numbers an year ago were downsized. This

we came to know upon pushing the executives in addition to filling the questionnaire. This has

become more prominent after the 26/11 attacks on two premier hotels of Mumbai-The Taj and

The Oberoi. Theres been an increase in the security measures adopted by these lines of hotels,

which is also seen in their recruiting policies in form of background check of employees. And it

needs no explanation how increased communal tension and terrorism is becoming more and

more part of economic slowdown. Surprisingly in low-end hotel Sun and Sheel, human resource

policies havent changed particularly as in theres no sense of job-insecurity. In fact, some

people who had quit last year were re-absorbed. These hotels as it is have low employee base

which they are sticking to.

Other factors of HRD Climate have also been observed at various places, for example in the

middle-tier hotels likeVits, a 4-star business-class hotel, job-enrichment per say is observed very

particularly in form of on-job rotation. We have a system of time-sharing division according to

which executives spend certain fixed time at each function, said Hemant, Travel Desk Head at

Vits. However, increments have taken a hit as in the executives continue to take home salaries

same as that of last financial year. But interestingly this is only hotel that has taken steps in

enriching Human Resource Information by bringing a magazine called Hospitality Crisis to

sensitize the employees about the effects if at all that the crisis is having on their sector and how

their hotel in particular is responding to it. This keeps the employees abreast with the

management strategies adopted by the hotel and thereby ensures high employee confidence even

when outside the environment is low.

What we have observed in general is that Hotel Industry faces crunch in terms of right-skilled

people and therefore at all times i.e. crests and troughs of an economic cycle, their efforts are


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concentrated around hiring best of the people, motivating them and are retaining them for years.

This was also found in the paper reviewed above and was re-confirmed through our interviews in

these hotels. Also, the assistance and the guidance given to executives and employees in general

is more personalized in the middle and lower-end hotels whereas the same is more formal and

standardized in form of training modules in 5-star and above hotels.


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QuantitativeAnalysis

Our quantitative analysis is from two perspectives.

1) Industry as a whole - where we do not divide the responses based on Organizations or Level in

the hierarchy which an employee belongs to.

2) Based on three levels of employees whom we targeted for this survey namely - Junior Level

(Entrants), Middle Level and Top-Level Executives.

Since the employees of the hotel industry have been questioned on the HRD Climate at their

organization, we believe that an element of employee's perception about prevailing HR policiescome into picture, which shall be different for employees of different cadre in a company (in our

case, hotel). So we have analyzed industry as a whole and from various classes of executives to

study if there exists any pattern in their understanding of HR Practices. All this will be done with

the economic slowdown in the backdrop. Following is a snapshot of how parameters ratings

differ when analyzed from various executive levels:

Let's take a look at how various parameters have fared:

Participation:


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If participation is looked at from the industry level, then people are divided between no-

involvement and high-degree of involvement. This can be seen in the line-graph indicating the

evenly balance count of employees, but at the same time, highest number of responses are in

affirmative i.e. they feel they are involved in day-to-day functioning. In comparison to this, if the

responses are studied based on the seniority level, it can be seen except for entrant level; both top

and middle-level know the HR Practices in greater depth and grade their participation level to be

just above average.

Succession Planning:

Industry curve suggests that employees on an average agree to the fact that a prior preparation is

done before filling a vacancy in hotels. And the fact that on an individual basis, various classes

of employees also concur on around 3.4-3.9 rating means that indeed succession planning takes

place at all times and is observed by one and all though slightly on a subdued level which could

be due to less attention paid on it as a result of slowdown, more important areas being cost-

cutting related activities.


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Human Resource Information:

It's the parameter that has received highest rating. While industrial view might suggest a heavy

agreement for this factor, but if seen closely it's because of high scores from Junior Level

Executives who are perhaps influenced by the various initial communications that they receive as

part of training and awareness. Leaving that aside, executives higher up the order in hotel

industry simply agree with the presence of an efficient human resource information system at the

organization.

Organization Development:

More senior an employee is, more aware he is to the responsiveness of the organization to the

any problems/short-comings. The same pattern shows us even in Hotel Industry. As we go from

Junior Level Exec to Top level, the understanding level of how organization responds to

problems in development goes down. This remarkable difference at individual level gets blurred

when seen from industry point of view which suggests that Hotel Industry in general is high in

Organization development, which might not be the case exactly.


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Training:

Presence of proper training practice is felt and admitted by the Junior Executives, who may be

undergoing additional training in present times to well-equip themselves for future. The same is

not so enthusiastically felt by employees up the order, perhaps because most of the employees

are well-trained till now and can learn only on administrative front. An over-all industry view

suggests that the training as a parameter of HRD Climate stands at just above neutral.

Appraisal:

The parameter, second best rated after Human Resource Information stands at this position

because of high-rating by Junior Level in heavy numbers. In recessionary times, appraising a

junior employee good doesn't cost an organization much. Same has reflected in Hotels as juniors

seems to receive a fair and impartial appraisal whereas middle-level and top-level see appraisal

as just "Okay" because with time spent in the organization, they have higher expectations but

probably the appraisal they face is not so fair for example appraisal ratings not reflecting the

performance, this may be because higher rating would mean higher hike/bonus component which

hotels are not in a position to pay, considering the tough times.


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Counseling:

Counseling is one of the rare parameters to have received a high number of disagreements. But

then that could be because our survey could gather fewer middle and junior level executives as

compared to higher level and it is the latter for whom counseling doesn't mean much anymore

because counseling involves guidance in on-the-job problems which is faced majorly by entry

level and middle level executives.

Career Planning:

The only parameter which was concurred by all three classes of executives suggests that Hotel

Industry is not the best places where the organizations will involve in planning an employee's

career. This is also re-instated by the industry level curve for career planning.

Rewards and Welfare:

Everything aside, when it comes to rewards and welfare, the executives working in hotel industry

are well-off as almost all of them are in agreement and some strongly agree about a good reward

system. But this industry view is a result of averages. When broken up from seniority point of

view, a strange pattern comes up - (of course not absolute measure, but more of perception)


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suggests that Senior most who expect the most and perhaps deserve also are not getting at par

(perhaps due to a cut in overall goodies in the packages) are dissatisfied, middle-level who've

just started getting increased benefits have rated highly while junior most who normally are not

entitled to too many perks and facilities have rated just above neutral. So recession has had an

effect on rewards and welfare.

J ob Enrichment:

An overall view of the industry suggest that people are not sure if there are any steps taken to

make job challenging which comes under job enrichment. On the other-hand, the seniority based

study suggests that middle-level executives have rated this parameter highest of all, may be

because they have been through all the possible job-rotations which junior level executives are

going through and hence not able to comment and at the same time top level executives who

kind of gone up on the same track also do not rate the parameter high.


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Overall trend

All in all, following is a snapshot of behavior of various parameters:

As can be seen, Human Resource Information, Appraisal and Organisation Development are

some the key parameters that have emerged as the most looked after areas in hotel industry as

percieved by the employees.

Besides the parameters, an overall trend has emerged out of the data collected from the survey.

Following are some of the salient points:

- Highest rating given by the Top-Level Executives in Hotel Industry as a whole is 3.9 meaning -

just agreeing. It indicates that with time they have come to realize that there are a lot of flaws inthe HR Policies. Or it could be because, as they are experienced and really senior, they command

higher rewards and promotions which they are not able to realize in recessionary times nor are

they able to quit and join any other Hotel, as a result over all low-ratings.


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- Junior level executives have crossed the 4 (Agree) levels quite a few times which could be

because they are relatively new in the industry and hence too optimistic, have aspirations to

perform and not yet exposed to the policies in real sense.

- Middle level sense the HRD Climate differently. They have rated high to all those parameterswhich was rated low by other two classes due especially Appraisal and Rewards. They seem to

have suffered lesser than other two classes. On other parameters, they have rated somewhere in

between juniors and Top level Executives.


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ConclusionIn a difficult economic climate the HR function can be an unloved role as the business begins to

search around for ways of cutting costs, scaling back and even downsizing. It is important that

HR provides the right tools for survival. Following are certain tools which we could realize

during our interaction with the employees and HR managers of various hotels.

Organizations/Companies here refer to hotels as the analysis is based on hotel industry.

Participation: Use the access to cost effective outsourced advice from employees to help work

through difficult situations in the workplace and reduce the risks to the organization.

Succession Planning: To ensure the right kind of recruitment that can be retained and plan the

human resource requirement

Human Resource Information: Make sure that the employees are given a solid grounding in

the organization with the help of induction procedures.

Organization Development: Constantly developing by ensuring that you have a strategy for

keeping staff costs down, prepare worst case scenarios for pay costs and staff costs

Training: Ensure that the business needs are properly served by the training programme. Review

the areas of training and ensure that they are still relevant to the current needs of the business.

Appraisal: In a hardening economic outlook it is essential the greatest but most expensive asset

of a company - its staff are working to optimum efficiency. Make sure that appraisal systems are

being used effectively to maximize the performance of staff.

Counseling: Regular counseling to employees regarding any difficulty they are facing in the

current scenario.

Career Planning: Retained employees be given an equal opportunity to discuss their future

plans with the company and employees that are asked to leave the company be given career

counseling as to what can they do in the future.Reward & Welfare: During times of economic downturn it is not possible for the company to

give the employees the same rewards that were given to them at the time of economic boom.

However, it is vital that companies explain this situation very clearly to employees to gather their

confidence and faith in the company.


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J ob Enrichment: Employees that are retained can always be rotated among different

departments and also given additional responsibilities to ensure job enrichment.

We have found from the survey that during economic downturn the companies are increasingly

changing their recruitment and appraisal policies. As stated in paper 3, companies are using thisopportunity to enhance and enrich the job responsibilities of current employees as they are not in

the position to recruit and if they are recruiting, the companies are recruiting only the required

talent and the talent that they can retain. This is essentially because there is a crunch of talent

availability in this sector, so companies want to hire and retain the employees for a long time.

Also, as we noticed in paper 1, the climate that is provided to employees has a positive impact on

the performance of the employees. This can be observed from the data analysis of the responses

received. Increasingly, companies are trying to provide healthy working conditions that can be

reflected by the positive responses received by the young employees. The top level employees

may not observe such a phenomenon probably because working in the company from a long

period has developed a laidback tendency in them.

Paper 2 talks about how companies need to combine corporate strategy with HR strategies.

Higher level of satisfaction in Human resource information among entry level employees may be

an indicator of this idea.

Companies are increasingly trying to bring the HR perspective into mainstream corporate

strategy because organizations have realized the importance of correct and through handling of

employees for higher performance levels which in turn will bring about a higher profitability to

the company.


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References

1. www.citehr.com

2. HowtodeliverHRinacoldclimate,BradfordInternationalCommission3. Paper1:

http://goliath.ecnext.com/coms2/gi198527914/DimensionsofHRDClimateenhancing.html

4. Paper2:

http://www.iimb.ernet.in/~rishi/Linking%20Corporate%20Strategy%20and%20HR%20Strategy.p

df

5. Paper3:

http://www.rsmchiolim.com.sg/res_pub/ManagingHumanResourcesglobaldowntu

rn_jan09.pdf

6. Paper4:

http://www.cni.ntu.edu.sg/about/2008/June%202008%20Media%20Stories/AsiaTravelTips

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