Recruitment Dissertation

8/3/2019 Recruitment Dissertation

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ABSTRACT

Title: Internal recruitment in the hotel industry a case study showing how this

factor affects the motivation of employees.

Background & Problem:The report reflects the idea of examining whether internalrecruitment can be a crucial factor adding to the success of an organization in the

hotel industry. It also examines how successfully internal recruitment can raise the

motivation and encouragement level to a large extent. This gives rise to two main

questions that will be answered in this report:-

- Is a well-known and recognized strategy sufficient as an incentive reward

system in hotels?

- Is there a disagreement between the views and perceptions of the

management and the employees of the incentive system in the hotel industry?

Purpose:The main aim of this report is to get an insight of the hotel industry and

assess whether internal recruitment exclusively can encourage and motivate the

employees.

Methodology & Delimitations: This report relies on two approaches. One of the

approaches is a qualitative one based on the interviews and other one is a

quantitative one, which is carried out through a survey. Both these approaches are

included in the case study that has been used in this thesis.

Results & Conclusions:The conclusions that were founded were related with thetwo different types of employees i.e. one who are young and are eager to do a

career in the company and the others who were mainly concerned regarding the job

security and a stable income. For the former ones, promotion works exclusively as

an incentive reward system and for the later group, promotion is not a matter of

concern as they would appreciate a higher salary rather. From the analysis a

discrepancy can be seen between the views of the management and employees

regarding the incentive system, where the workers were not well aware that there is

any kind of incentive reward system that existed.


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1. INTRODUCTION

In this section of the report, the author has presented the background, an analysis of

the problem and the purpose behind the research. The final part of this section

includes the disposition of the thesis.

1.1 Background

The world is transforming at a rapid pace. The globalization has affected every

industry sector and company globally, but some more than the other ones. One of

the industries that are growing at a faster pace is the tourism industry, which

according to Stutz (2005) is expected to grow at an annual rate of nearly 3 percent

globally. The highest rate of development and growth takes place in the developing

nations. Tourism industry has the potential to achieve greater heights but the

competition is very fierce. To offer the customers what they want and fulfilling their

expectations, the hotel companies need to settle in rapidly and widen theirknowledge. Kaufmann (2005) cited that the employees who are motivated and

encouraged perform better and develop a stronger feeling of belonging to the

company. One of the main factors is to encourage and motivate the employees so

that they are capable of providing and offering such services needed by the

company so as to succeed. Ljusenus and Rydqvist (2001) considered that employee

motivation and a high level of satisfaction within the employees aligned with

proficiency to be the key factors of success. When knowing what are the main

factors of success are, how do one execute a successful strategy to gain maximum

benefits out of it?

The companies are making use of reward systems to encourage the workers. Every

company uses its own developed incentive system that includes many other

systems. Incentive systems exist in many different forms and include four basic

processes as described by Merchant (2007):-

- Performance measures

- Level of targets

- Evaluating performances

- Rewards

According to Ahrnborg (1997), one of the most popular and recognized incentive

systems is internal recruitment and has an old tradition in the hotel industry.

Merchant (2007) mentioned internal recruitment as one of the non-monetary

rewards. This makes it an interesting area to examine whether internal recruitment

solely can inspire and encourage the employees.

The hotel industry has a comparative high labour turnover and is characterized by

inadequate academic education. High labour turnover emerges out to be an issue for

many companies as new recruitments and learning processes cost a lot and

companies also fear the loss of proficiency and productivity. But high labour turnover


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can also facilitate the companies in cutting down the expenses for employees,

providing them with minimum salary. This makes it very interesting to assess

whether it is possible to inspire and encourage workers exclusively via internal

recruitment (Jaghult, 2005).

1.2 Problem Discussion

The author aimed at examining whether there is any connection between internal

recruitment and encouragement and if this motivation can be considered a crucial

factor really motivating the workers in the hotel industry. The author has been

thinking and considering the doorman, who with excellent work and internal training

as well as education, accomplished to become the manager of the Hotel ETAP. The

author felt it very impressive and wonders if it is something that workers consider

while carrying out their activities and if it has significant impact on their motivation as

well as overall performance. Following are the two main questions that need to be

answered through this research:-

Question 1: How can an incentive reward system be designed and developed

in the hotel industry?

Question 2: How do the workers consider the incentive reward systems

utilised in the hotels inspected?

It is not sufficient that the employees are encouraged, but they have to be motivated

for the right things. This can be said that the motivation of the employees should be

connected with the goals and visions of an organization.

Here, the author expects that the hotel that is taken into consideration had

profitability as its vision. Further on, the author felt that in order to derive any

pertinent conclusions he wanted to get a wider perspective of the views of the

workers regarding their situation and the factor that truly encourages them. Merchant

(2007) asserted that many different aspects follow apart from being recruited

internally like increase in salary and increase in responsibility and recognition. It is

very significant that the management should be aware of the reward methods

followed to motivate the employees. The author carried out a survey for the workers

in order to get an idea. This provided the author with answer to his second question

and then comparing the answer with the view of the manager of what factors drive

and encourages the employees. The author also examined whether there is any

opposition among the views of employees and manager on motivation and how shall

the management act to develop the internal recruitment strategy of the company.

1.3 Purpose

The main aim of this report is to get an insight of the hotel industry and its incentive

systems for the workers. The author wanted to examine whether internal recruitment

is adequate to encourage the workers and if it could be the crucial factor for success.Further on, the author wanted to examine some topics where little research has been


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carried out. Keeping this in mind, the author wanted to answer the main questions

that have been described in section above.

1.4 Disposition

The author has provided with the disposition of the thesis in a brief manner in thissection. This disposition was developed after performing the literature review and

other thesis and the author felt that it would help a more logical flow throughout the

thesis.

Methodology

In the methodology section, the author has explainedthe different emthodological approaches utilised inthe research process

Theoretical frameof reference

The theories that will act as the base of the researchare prsented in this section

Empirics

The data collected including the empirical base for thethesis is presented

Analysis

The empirical daa is analyzed utilising the theoreticalframe of reference highlighting the significant findingsand to see how theory comply with the reality

Conclusion

The conclusions drawn by analysing the


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2. METHODOLOGY

The author has used two different methods of gathering the data i.e. qualitative and

quantitative method. The research process selected by the author for this thesis has

been chosen to suit the need of a high level of flexibility so as to change the existing

questions. Both the methods are explained as follows:-

2.1 Research Process

Usually the data can be collected of gathered through two different ways i.e.

qualitative method and quantitative method. Halvorsen (1999) asserted that both the

mentioned options differ in usefulness based on the kind of study being carried out.

Taking into consideration the way in which this research was carried out, the

research process was selected from different methods that suited the need of the

author regarding the high level of flexibility so as to transfer the existing questions

and fact, relying on the kind of information being found accessible as well asmotivating to carry on the research or study. Ejvegard (2003) explained that the

duality of methodology, where it sees very essential and necessary to attain a high

level of flexibility due to different situations influencing the accessible information and

the other perception where one have to, as much as possible stick to the actual plan

developed in the earlier stages. The author felt that researching on such a general

subject area; this approach was perceived necessary so as to perform the planned

study of the hotel industry.

2.2 Qualitative Research

Wallen (1996) described qualitative research as an approach of examining the

smaller sample of objects in a more thorough manner. As suggested by Trost (2005),

a qualitative approach can be utilised by the researcher while trying to portray,

explain, and find patterns or just trying to increase the understanding regarding a

phenomenon. This is what is being tried to achieve through this research, which led

the author to carry out a case study of the hotel in the Hounslow area of UK. A case

study has been described in this thesis as data gathered and presented in a

particular small group from a population and the small group represents the whole

population as close as possible. To answer the problem in a correct manner, a casestudy has been performed that will suit the time limitation of the author as well. The

key advantage of this approach is that the author does not have to examine all the

companies in the hotel industry and draw relevant conclusions from the study. The

main disadvantage is that the author needs to be very careful with the conclusion

drawn by the author and deduce them more as indices that might point in a specific

direction.

2.3 Quantitative Research

Denscombe (1998) described quantitative research as a method to utilise numbers

rather than words as a base for the analysis. The key objective with a quantitative


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research is to collect data and convert what has been collected to quantifiable units.

He further claimed that it is generally linked with the analysis, rather than a

description and it is especially good when it comes to making a comparison of the

data. Usually in statistics, the higher the population of a sample is, the higher the

level of validity will be. This research though, will rely on the small scale sample ofsurveys, being performed at the hotel in the Hounslow area of the UK, so as to look

for the discrepancies among the incentive systems being utilised and the ideas of the

floor workers regarding the aspects that truly encourages them to stay and work for

the company.

Denscombe (1998) further emphasizes the significance of isolating the variables,

which is to set them free from their correlation with other variables and takes into

consideration their independent affection of the issue aligned. As per Denscombe

(1998) the key aim of the quantitative study is that the object under study will have a

high level of objectivity. Another significant detail regarding the quantitativeresearches is that they have a set research design and format, i.e. the design of the

research process is intended prior to the conduction of the research study.

Taking quantitative research in mind, the surveys conducted by the author were

performed in line with the hints presented by Denscombe. Although, the author has

not considered this research as a purely quantitative one because of insufficient

respondents and small scale, but has rather considered it as a more qualitative study

carried out with the help of surveys.

2.4 Types of Data Gathered

It is significant to know the kind of data utilised while performing the study. Some

techniques perform better than others and some are not relevant enough. In the

survey conducted by the author, it has been found that:-

- Data on a nominal scale: The lowest level of assessing like man/woman

- Data on an ordinary scale: Graded answers like agree completely, do not

agree. These types of scales are ranked in numbers and are usually called

the Likert scale.

Denscombe (1998) stated that good science usually depends on both the qualitative

as well as quantitative sources and that there needs to be a difference as to where

the attention and emphasis of an approach lies. In this thesis, so as to attain

answers in a more thorough manner, it seemed more appropriate to carry out the

qualitative interviews for the management. A survey was selected so as to sort out

all the activity differences among the workers related with the floor staff.

2.5 The interviews conducted

So as to get in depth understanding of the situation in the hotel industry, the author

has aimed at interviewing the workers at ETAP hotel and Days Inn hotel in theHounslow area of the UK. The author has selected a qualitative approach via


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interviews and quantitative study through a survey carried out with the employees.

The employees of the hotel that has been selected by the author to interview were

the ones responsible for recruiting. The selection of the employees interviewed was

in the context with Trosts (2005) suggestions that the author should aim for a level

of saturation in the answers provided. By a level of saturation, Trost (2005) meansthat when the people who are interviewed give quite same answers to the questions

asked, an adequate level of saturation is attained and the validity of the study need

to considered high.

2.6 Reliability and Validity of the Research

Ejvegard (2003) stated that reliability is regarding the credibility of the measuring tool

that is utilised to carry out a study. In this case, it is related with keeping a high level

of honesty and credibility while performing the interviews and not to draw any kind of

conclusions that cannot be backed up with relevant theory and empirics and to keep

it as unbiased as possible. One of the ways through which the level of reliability can

be increased is by creating the questions that were used in the interviews with a

strong base from the literature, so that the questions should be more up to date and

relevant in nature. Apart from this, the author has decided to utilise semi-structured

interviews where open questions were given to the respondents where they could

talk more describing about the subject rather than asking the framed questions with

yes or no as answers. Ejvegard (2003) suggested this kind of approach so as to

perform more in depth study and analysis of the questions structured.

The employees with high level of skills and expertise in specific areas that need tobe examined by the author were selected so as to make sure that the answers given

should be reliable as well as trustworthy.

According to Ejvegard (2003), good reliability is an essential, but not adequate

decisive factor for good validity. As per Trost (2005), validity can be described as to

what level a measuring tool really measures what it is proposed to determine.

2.7 Selection of the Companies

When the author looked into the topic are of internal recruitment, the author

discovered a specific business sector where internal recruitment was broadly

utilised; the hotel industry. The self experiences of the author from the hotel business

were slim to none. So as to obtain a high reliability level, which is essential so as to

keep the scientific level of this thesis high, the author decided to select two different

hotels in the area of Hounslow, UK, which are not being owned by the same

company or group. The author made this selection of hotels as he intended to obtain

a wider view than would have been gained by only one hotel chain. So the following

listed hotels were selected:-

- ETAP Hotel

- Days Inn Hotel


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2.8 Method Criticism

When the author select to carry out a case study, the author knew that by

considering a small sample from a large industry, the results attained might become

a bit biased and the outcomes would include indications despite of the actual results.

Related with the survey, a small sample was prepared from both the hotels, where

the workers had the answer to the same questions, even though both the hotels are

different in some areas. The intention of the author related with conducting the

survey was primarily to get the answer to the second research question, which was

whether there can be found a discrepancy among the ways used by the

management to motivate the workers and the thoughts of the employees regarding

the motivation and the ways in which the incentive compensation systems can be

used by the hotels to encourage them. Among the questions that were answered

were: do you feel encouraged. One can hold discussion if the workers felt urged to

answer what the manager or leader desired to hear, so as to avoid reprisals from themanagement, although it was explicitly written that they were 100 percent

anonymous.Another question in the survey was: if promotion was the only kind of

reward in an organization, would it raise your motivation level? The question is

hypothetic in nature and the author is now afterwards being self-critical, developing a

sense that the question was not clearly enough defined.

A stratified sample cannot be developed, because of the insufficient number of

respondents and the author could thus not utilise a statistically secure answer from

the different types of workers. Even though a stratified selection cannot be made, the

answers obtained, aligned with the two deep-interviewed answers of therespondents gave the author a hint that is described in both the analysis and in the

conclusions as well.

The reason because of which some of the respondents did not want to answer the

questionnaire could be different. Either that something came in between when they

were believed to answer it or that they simply did not want to participate in this thesis

when not giving them any kind of aware while answering it.

Related with the sample of participants involved in the survey, a mere 50 percent of

the circulated survey became the actual outcomes. One could hold discussion thatthe inadequate answers from the workers would show impact on the outcomes in a

certain manner, but on the other hand, it might impact it in another way or simply not

at all as well. Thus, the author have decided not to draw any conclusions from the

insufficient answers, but rather than just citing it.

2.9 Delimitations

The area being examined by the author, internal recruitment in the hotel industry,

includes a wide variety of different parts. The author chooses to narrow it down, and

as objectively as possible to select the parts that seemed to be most pertinent. Afterbrowsing the different resources and appropriate literature, it was determined by


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author that in the frame of reference, to emphasize on the areas of internal

recruitment, incentive compensation systems and motivation. Of course, the author

also had to mention other relevant areas as well like value drivers and the hotel

industry in the United Kingdom. They seemed appropriate for attaining a better

understanding and a better overlooking picture, so as to develop a strong basis forthe questions and the observed part.

2.10 Literature

When the topic was selected by the author, he first searched for appropriate key

words at the different data bases and then searched for the books related with the

recruitment, encouragement and controlling. The key words that were being

searched by the author include: internal recruitment, the hotel industry and incentive

systems in the hotel industry.

2.11 A brief summary of the method

Firstly, the topic was chosen by the author and a small background research was

made by him. The sources for the authors frame of reference were gathered and

began preparing questions to be asked during the interviews. Then the author

gathered the information into empirics and by analysing the empirics with the frame

of reference in the analysis, the author came up with his conclusions.


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3. THEORETICAL FRAME OF REFERENCE

This section provides a theoretical background that is used to conduct an empirical

evidence part. This section is mainly categorized into three different parts i.e. the

hotel industry of the UK, incentive reward system and motivation.

3.1 The UK Hotel Industry

According to the Law (2002), the hotel industry in the UK is a big industry, which in

the last year had over 2200 hotels and nearly 35 million rooms available, where half

of them were utilised during that time. The hotel business is featured as a capital

rigorous industry, where majority of the funds are tied up in tangible resources.

Further on, it is related with four main factors i.e. high fixed expenses, big

fluctuations in demand, big problems and issues with capacity and the fact that they

perform their operations in the service sector. Law (2002) categorizes the customers

into two different segments and divides foreign customer from the native ones. Allthe segments accounted for the below listed percentage during the last year;

- Business travellers: 63 percent

- Private guests: 37 percent

- UK guests: 77 percent

- Foreign guests: 23 percent

3.1.1 The UK Year in Review: United Kingdom

The year 2010 proved to be a very challenging year for the economy of the UK. The

VAT in 2010 came back to 17.5 percent after a temporary decrease to 15 percent in

2009. Other factors increasing the challenge on economy in 2010 include rise in the

inflation rate to 3.7 percent, rise in the prices of oil and energy etc. Despite of the

ever changing economic and political scenario, the economy of the UK emerged

from the recession in 2010 with GDP growth of 1.3 percent in comparison to -4.9

percent witnessed in the previous year. This lead to a recovery in the conditions of

the hotel market for the first time following an economic downturn that started in theyear 2008. The continuous growth of the hotel market of London is the most

important factor that influences the overall performance of the UK. (HotStats, 2011)

UK Full-Service Hotel Performance Indicators

2010 2009 % Variance

RoomsOccupancy (%)

73.6 72.1 1.5 pts

Average Room

Rate ()

90.54 87.09 4.0%

Rooms RevPAR 66.68 62.78 6.2%


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()

F&B RevPAR () 33.72 34.05 -1.0%

TrevPAR () 108.78 105.30 3.3%

GOPPAR () 42.23 39.72 6.3%

GOP %age ofTotal Revenue (%)

38.8 28.6 1.1 pts

Payroll %age ofTotal Revenue (%)

28.3 37.7 0.3 pts

(Source: HotStats 2011, UK & Europe)

An increase was witnessed in the average room rate and rooms occupancy during

2010 leading to a significant rise of 6.2 percent in rooms RevPAR. A significant

driver for the rise in demand during the period of summer holiday was continued byStaycations as the UK based tourists continued swapping their overseas hotels for

the UK regions.

The downward trend in the tourism industry of the UK continued during the year

2010 with over 29 million overseas residents visiting the UK. The bad weather of the

UK also resulted in a sharp fall in the number of visitors coming to the UK from

abroad as heavy snow and rains led to severe travel disruptions. The hotel industry

of the UK was considerably affected by the bad weather because of a large number

of cancellations and harshly reduced access. There is still a sense of uncertainty

around the economy of the UK as well as nations operating environment of the hotelindustry with many potential hotel developments and transactions still being

postponed because of insufficient funding. (HotStats UK & Europe, 2011)

Still many hoteliers are felling optimistic regarding what lies ahead as the operating

figures show the signs of recovery that decreased in the year 2009.

3.1.2 The UK Year in Review: London

The hotel market of London has continued not only to satisfy but to exceed the

expectations in the recent years, with the economic downturn affecting the conditions

of the hotel market in a less manner than expected. London, which is considered as

a corporate, conference and leisure destination, has highlighted its spirit by showing

a significant recovery in the overall operating performance during 2010 as the UK

economy emerged out of economic downturn. Many global events have been

attracting the demand to the city that includes Wimbledon Championships and the

biennial Farnborough Air Show. The hoteliers of London will be much more optimistic

about building upon the recovery in the performance during 2010, specifically with

the London Olympics in 2012 on the verge. (HotStats, 2011)


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London Full-Service Hotel Performance Indicators

2010 2009 % Variance

Rooms

Occupancy (%)

82.1 80.1 2.0 pts

Average RoomRate ()

123.32 113.23 8.9%

Rooms RevPAR()

101.20 90.72 11.5%

F&B RevPAR () 33.81 32.89 2.8%

TrevPAR () 141.22 129.69 8.9%

GOPPAR () 67.47 59.29 13.8%

GOP %age ofTotal Revenue (%)

47.8 45.7 2.1 pts

Payroll %age ofTotal Revenue (%)

24.3 25.2 0.9 pts

(Source: HotStats 2011, UK & Europe)

The London hotel industry witnessed an increase in both the room occupancy and

average room rate in 2010. Despite of the rise in demand for the hotels in London,

the passenger traffic at all the airports of London fell. This was because of the rise in

fuel prices and many weather disruptions caused during 2010 such as disruptions

caused by the ash cloud.

3.2 The Labour Force in the Hotel Industry

The hotel industry is categorized as an industry with a large workforce, which usually

lacks adequate academic education and is considered low-paid. Because of the

insufficient qualified tasks for the workers, it is also categorized by a high labour

turnover. Freedman and Kosova (2010) cited that according to a survey conducted

by the American Hotel Foundation between the year 1995 and 1997, showed that

the average annual turnover among line-level employees was nearly 40 percent in

the US.

Freedman and Kosova (2010) found in their research that franchise-owned hotels

have stronger incentives to assess their workers than company owned hotel, since

they are outstanding claimants because of their franchise framework. While the

managers of the hotel chains that are managed by the companies are less willing to

observe their workers to a large extent, because they are not entirely tied to the

incomes from their properties, but instead have an opportunity to channel money

between the different hotels. One of the major reasons to observe their employees

was the risk of theft, as the hotels are open 24 hours every day and that they are

categorized by a high labour turnover. Freedman and Kosova (2010) also found that

the franchise-owned hotels are more pumped up where as the managers who have


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invested their money in their hotels work more hard and care a lot about their

investments.

3.2.1 Labour Market Trends

The analysis made by British Council (2009) showed that there has been a growth inthe employment rate in the UK. This is because of the new jobs being created in the

areas of cafes, restaurants and accommodation. This places the hotel industry of the

UK among the five top employers in the country. The report indicated job prospects

as very good and excellent for the chefs and cooks with strong future job growth.

There is a very high percentage of the part-time employment in the industry with

more than 50 percent of the jobs being part-time; in addition to a rise in the

casualisation trend of the employees.

3.2.2 Skills Shortages

There are enormous shortages in the skills in the hotel industry, which have been

recognized by the surveys conducted by the British Council considering the different

leading hotels. The report indicated that over 90 percent of the employers believe

that there is a considerable shortage of talented cook, chefs and bakers in the

hotels. And also there has been a shortage of skilful people holding the positions and

performing the roles as food as well as beverage attendants.

3.2.3 Skill Needs in the Industry

The requirements of the skills of the hotel industry are far wider than the technical

proficiencies easily recognized. This includes employability skills like problem

solving, communication as well as teamwork. These skills are very significant for the

success of the hotels in such an ever changing and growing industry sector. To

capability of the workers to multi skill is also very significant from the perspective of

the hotel employers. Also, the employers of the hotel industry are searching for

flexible combination of skills that can be tailored so as to meet and satisfy the needs

of the hotel businesses.

3.2.4 Challenges faced in involving young people

The hotel industry has been encountering a lot of barriers that need to be overcome

so as to engage the young individuals in the industry. They are not limited but

include the following:

- Young individuals still have a perception of the industry as being a job they

carry on while waiting to get a real job

- Inadequate knowledge of the career paths and job results possible in the

business sector

- Difficulty in involving the individuals who acquire the adequate attributes and

attitude to enjoy success in the hotel industry


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- Insufficient promotion of the portability of the abilities learnt in the hotel

industry

- To overcome the view of unfriendly working hours for the young individuals

that includes shift work, weekends and highly seasonal work.

3.3 Incentive Compensative Systems

The main aim of the incentive reward systems is to tie rewards to the performance

appraisals. Merchant (2007) cited that the systems inform and remind the workers

regarding the results are significant and encourage the employees to accomplish the

outcomes. In order for the rewards to be classified as compensation, it must be a

direct link among the results and the reward; it cannot depend on subjective factors.

Jaghult (2005) asserted that the incentive reward systems are significant for an

organization, so as to provide information to the workers. They also act as incentives

to encourage the workers and put an additional effort into their work. They are alsopersonnel-related in regard to attracting the right individual for the role. According to

Merchant (2007) when relating high payments to the rewards, the systems tend to

attract managers who are less risk-averse and have more entrepreneurial abilities.

The rewards in the incentive compensation system are categorised in two categories

i.e. monetary and non-monetary rewards. The author has stressed on the utilisation

of the non-monetary rewards. Merchant (2007) cited that the non-monetary rewards

usually include the following mentioned rewards:-

- Promotion- Rising in position or rank

- Autonomy

- Personal freedom

- Recognition that someone taking notice of the employees good behaviour

- More responsibilities and getting the chance to contribute more in the

discussions

3.4 Group or Individual Based Performance Measures

According to Merchant (2007), the rewards that depend on collectiveaccomplishments motivate the cultural control. These rewards can be categorized in

different forms, but are often state in the monetary terms and work as incentives to

encourage and develop a sense of involvement and make workers think in the

similar terms as the owners. Merchant (2007) cited that the group rewards in

comparison to individual rewards have a smaller connection among the personal

efforts made and the outcomes being rewarded.

A significant factor for an incentive reward system to work effectively and in a proper

manner is its ability to be affected by the actions of the workers. If the workers are

incapable of having an impact on the results being assessed, then it has to be


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considered as a rather pointless incentive reward system. The main issue with the

group rewards is the low level of affection, where the workers in the bigger groups

might feel that their performances impact the overall performance in a smaller way.

Merchant (2007) described another issue is the free rider effect, where some

workers tend to slack and enjoy the luxury ride on the expense of others.

3.5 Use of Non-Financial Measures

Today, many organizations tend to utilise non-financial ways like market share,

customer satisfaction or product quality, so as to work as indicators for future

financial performances. Banker et al (2000) described the utilisation of non-financial

ways as something that is used often in association with financial measures so as to

evade long-term goals with the ones that are short-term and overcome investment

myopia and offer better information regarding future results. It is also stated that non-

financial measures could offer more insightful control by going past the limits of

combined financial measures. Vaivio (1999) stated that the utilisation of non-financial

measures will emphasize the interactive control of top management over particular

targets within the firm and leads to a gain in majority of the objects having strategic

importance.

Banker et al (2000) found in his study that there is a direct link among the customer

satisfaction and future financial performances. In this direct link exists an interval of

nearly six months between the customer satisfaction and its impact on the financial

performances of the coming times in the hotel industry.

3.6 Use of Financial Measures

The main aim of profit-making organizations is to maximize the shareholder worth or

value. The term financial measures are separated into two different groups:-

- Market based measures like changes in the prices of stocks, dividends and

shareholders returns

- Accounting based measures like operational profit, enduring income, ROI,

return on equity or return on net assets

The above mentioned financial measures are easy to compute but harder topersuade and apparently they are also hard to tie towards performances. Many

experts claimed that even though a lot of firms make frequent use of merit increase

salary systems, the associations among performances and payments were on

average very low.

3.7 Incentive reward systems in the Hotel Industry

The hotel industry belongs to the service sector and the companies in service sector

strongly rely on their workers to deliver high quality services and thus require

motivate them somehow. Namasivayama (2006) cited that one of the ways of doingso is with the help of incentive reward systems, where the managers design and


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developed personal programs to encourage, retain and attract the employees.

Chiang and Jang (2008) asserted that motivation is one significant tool that affects

the behaviour of the employees as the work in a hotel is categorized by low salaries,

rigorous activities, low status and little opportunities to get promoted.

According to Simon and Enz (1995), there are four most significant factors to gain

encouraged workers in the hotel industry i.e. a good salary, a safe working

environment, opportunities for promotion and a healthy organizational culture.

Relationship with the boss is considered to be the least significant factor for

motivation.

According to Meudell and Rodham (1998) the most significant factor for motivation in

the hotel industry is the monetary rewards. But they also considered other aspects

such as age, length of employment, gender and ethnicity. Meudell and Rodham

(1998) found in their survey that there exists a considerable discrepancy among the

employees in different age groups, whether what factors make the workers perform

better and work hard. Kovach (2001) examined more than 1000 workers within the

hotel industry, and asked them to prioritise among the different categories that make

them work as well as makes them work harder. From the analysis, they found that

the age group ranging from 18 to 24 prefers money and monetary incentives. The

age group of 25-34 ranked majority of the factors significant. The 35-44 year age

group consider threat of losing the job as the most significant factor, whereas the

age group of 45-54 considered healthy and safe working environment as most

important. Meudell and Rodham (1998) also considered the factor of the length of

employment of workers. The employees who had been working from six months orso stressed more on money and incentives or bonuses. The ones who had been

employed for over a year or so emphasized more on the promotion and for the

employees working for more than a year promotion and opportunity to compete were

recognized as the important factors that make them work hard.

Meudell and Rodham (1998) also cited that the worker who are paid on hourly basis

show less affection towards their work and most of the times they only care about

the monetary rewards. Weaver (2000) cited that where work in its own is not a

satisfied work, the most significant and appropriate incentive compensation systems

are through the monetary rewards.

One of the main problems cited by Anthony and Govindarajan (2007) while

developing an incentive reward system in a firm belonging to the service sector is

that the fir cannot assess the quality of the product before it meets the customers as

a producing firm can do. This shows that the quality can only be inspected in the

moment of truth when the customers meet the employees of the company.

Gronroos (2002) stated that it is significant that the design of an incentive reward

system in a service firm is made in a way so that it shows the workers that the

company do consider and recognize a good service minded behaviour.


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Namasivayama (1997) found out by studying the compensation systems used in the

hotel industry of America that lower turnover rates in the hotels that had pension

plans. It is worth describing that the learning cost of worker turnover is negatively

associated with customer satisfaction and performance of an organization.

3.8 Value Drivers in the Hotel Industry

As cited by Merchant (2007), What you measure is what you get

For gaining a better understanding about the hotel industry and he considerable

factors related with measuring the performances, it is important to explain the value

drivers. As per the research in the UK hotel industry carried out by the British

Council, the core offering of a hotel i.e. price, location and room, contributed for 70

percent of the choice criteria. Graff (2003) cited that based on the kind of customers

to be examined; they showed different attitudes towards diverse value drivers. In

their research, they categorised them into two different segments i.e. business andleisure travellers.

The crucial as well as significant value drivers for the segment of the business

travellers seemed to be core amenities, location, and price and loyalty programs.

Graff (2002) cited that related with the leisure travellers, the key value drivers were

the amenities and the price.

Hotels provide services via renting the rooms out and offering comfort to the

customers. Kotler (2008) cited that a service is something that is being consumed at

the same time it is being developed and can thus not be stored. Thus, a newownership will not take place. But by viewing the hotel industry through a product

perspective, it s very easy to understand the important and considerable factors

associated with the hotel industry. By looking at every element and viewing them as

value drivers, one can easily analyse what makes the benefits and analyse the way

through which they can be made competitive. The companies who are successful

first recognize what is being required by the core customers that can be satisfied by

the product or a service. Then, they will design the actual product or service and will

finally look for the ways to enhance it so as to create many benefits satisfying the

customers. Kotler (2008) cited that now-a-days, most of the competitive takes placesat the level of product enhancement or augmentation. Kotler (2008) also asserted

that the successful organizations add benefits to the offers they provide that will not

only help in satisfying as well as delighting the customer.

So as to delight the customers and offer them something extra, many different

methods are being used by different hotel groups. But as per the article by Ropeter &

Kleiner (1997), the crucial factor is related with basic common courtesy. They stated

that if a hotel treats every customer, regardless of the situations as a king or queen,

offer basic courtesy and attention to every customer, the overall impression received

by the customer will be positive. It only takes one bad experience to shift thecustomer off, but several good ones to make them happy and increase their


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satisfaction level. Ropeter and Kleiner (1997) described that a dissatisfied customer

will tell ten other people about his dissatisfaction as compared to the customer who

is happy and will be telling only three people.

Core Product: A room and a bed

Expected Product: TV, sheets etc.

Extended Product: Something

that stick out, experience

(Source: Kotler, 2008)

3.9 The Significance of Selecting the Right Workers

Having the right individuals in the right positions and roles is a very crucial and vital

success factor for every organization. The managers and supervisors usually take

into consideration the recruitment and selection of the right individuals and them

keeping them, as the most significant and crucial factors for an organization in long

run. Hessner (2009) also cited that an organization is able to solve its issues and

problems and take advantage of the possibilities in a better way when anorganization does this.

Zeithaml and Bitner (2003) cited that it is very significant for the service firms to have

employed the service minded workers, as they are the front and significant tools of

marketing. They are the ones who offer services to the customers and who will be

remembered. Thus, it is significant to analyse in a careful manner whether the

potential worker is ready to emphasize on quality and encouraged to work in a

service minded manner, prior to the recruitment of a new worker.

Duggan and Croy (2004) stated that an organization has two different choices whilerecruitment of a new worker need to be made. Either, they employ an individual

Guarantee

Quality

Core Product

Styling

Service


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internally or externally. If an organization chooses to select externally, they can

either recruit a worker with already appropriate abilities or with potential abilities

where they need to provide training the worker and educate them.

3.9.1 Elements of Recruiting and Selecting the Right Staff

Different elements of recruiting as well as selecting the right workers as described by

McKenzie and McKenzie (2007) are listed as follows:-

1. The organization is a place that workers are proud to be related with

Every individual wants to be related with a winner. The word of the positive working

environment of an organization will get out into the greater community. The company

will be like a magnet, attracting the skilful and talented individuals towards it. Both of

them provided information, tools as well as methods for the managers and leaders to

make use of creating as well as sustaining a constructive culture for the workers andthe organization as a whole.

2. Job descriptions are meaningful and link to the core competencies and

desired outcomes of a position

It is very important to recognize the needs of a position or role. Job descriptions are

too often generic in nature and do not describe the real needs of the role. Good job

descriptions as well as job profiles include a list of core competencies needed and

necessary for the job. Core competencies lie at the centre of what makes the best

people in this role simply most effective and best.

3. An effective recruitment and selection process is in place and being

adopted

Recruitment as well as selection are viewed and treated as a top most priority for an

organization. Time is made available so as to adopt and implement the processes

put in place. Leaders need to be directly involved themselves as suitable, and

monitor the progress as well as outcomes. The open job roles are filled so as to

reduce the stress on the leaders and front line workers. Leaders are involved in the

process of hiring and viewed as having a major role in recruiting staff for their

departments.

4. The right people are chosen and put in right staff positions

The responsibility for recruiting as well as selecting the right people is hold by all the

management levels within an organization ranging from execution in charge to front

line managers. If the positions are improperly filled or go unfilled it can seriously

impact the supervisors as well as front line workers.

5. New people are helped to get off to a great start


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An initial experience of a new worker with the administration of the company plays a

vital part in the individuals decision either to stay or leave the company.

3.9.2 Six-step process for Recruiting and Selecting the Right Staff

Conducting interviews and selecting the workers for different positions within anorganization can be complex and a time consuming process. It is usually feel like

trying to search a path through a maze.

Selection needs a careful thought-out and repeatable process so as to do it in a

proper manner. The staff members who are involved in hiring will need to have a

continuous training in the process as well as opportunities to enhance their abilities.

Whether taking into consideration internal or external candidates, it needs to be

assured that the process must be designed for selecting the people who will properly

fit as well as stay in the organization for long-term.

The organization is aplace that staff are

proud to be associatedwith

job descriptions aremeaningful and

associate to a position'score competencies and

desired outcomes

an effective recruitmentand selection porcess is

in place and beingfollowed

The right people areselected and put in the

right staff positions

New people are helpedto get off to a great start


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Below mentioned are the six major steps that should be considered for the

development of the selection process:-

Step 1: Determining the needs of the position i.e. core competencies and job

descriptions

Job descriptions are too often generic in nature and not very helpful in defining the

main performance objectives associated with the position. Required working

experience, educational qualification, basic work functions etc. are usually descried

with the job descriptions. Although these pre-qualifications do not actually lie at the

centre of what a successful match between the job candidate and job role really is.

For providing true help, the job descriptions must properly and clearly define the

outcomes as well as achievements that are expected from the position and the skills

needed for the role as well. The job descriptions must describe the core

competencies that are required to be successful at a specific position. A sample job

description form is shown as follows:-

Tool: Sample Job Description Form

Title/Position:

Date: (date this job description was written)

Description of the service offered by this position:

(What is the aim of this job? Write a brief summary that describes this job. What are

the desired procedures utilised; desired results; what are the locations and special

conditions in which the job will be performed? What would doing this job successfully

look like?)

Primary tasks to be carried out:

Determine

NeedsRecruit

Screen

ResumesInterview

Compare

& Assess

Make

Offer

Source: McKenzie & McKenzie (2007)


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(What are the performance objectives related with this role? What are the particular

day-to-day, week-to-week, month-to-month tasks that must be performed to achieve

success at this position? Make use of verbs like plans, recommends, interviews etc.

for describing the tasks and functions. Also illustrate the work timing i.e. what need

to be done when or how often, etc.)

Prerequisites needed:

(What are the fundamentals for this position that includes academic, certifications

etc.?)

Job skill, knowledge and experience and personality traits:

(What abilities, knowledge and experience have? Think about the aspects that make

people work their best in this position)

Behavioural attributes, attitudes, motivational factors required:

(What are the behavioural and overall personality attributes, essential to achieve

success in this role?)

Primary people contacted:

(Who will the person doing this job be working with that includes customers and

peers? Who will the individual performing this role work for?)

Step 2: Developing and executing the recruitment plan

An organization can be unaware of the opening of a new job or role as an employee

can leave the company unexpectedly. The companies need to develop a plan in

advance to start the actual job specific recruiting effort that will help them coming out

of such unexpected problems. The fundamental components of the plan include the

following:-

- Worker policies and plans that seek for advance notice of the recruitment

needs of a company in order to fill the vacant positions in a controlled manner,

not in a crisis.

- Job descriptions need to be kept current and available in a place where the

recruitment of the supervisors and managers can access the latest version.

- The file including job descriptions also includes the pre-defined ads for printnewspaper and internet.


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- The company has existing resumes on file that are submitted before the job

opening for likewise roles.

- Management and administrative workers are offered with continuous training

in recruitment and interviewing

- An executive needs to be assigned to manage the process of recruitment andselection.

- Internal employees need to be made aware of the opening and motivated to

refer potential applicants or apply themselves as well.

Step 3: Screen resumes, evaluates and selecting the most promising

applicants

Develop an objective as well as repeatable process for how the resumes should be

collected and processed that includes assigning the responsibility of reviewing and

screening them. Different steps that need to be carried out in the process of

screening the candidates are:-

- Log in the resumes as they are received

- Conducting first level screening of the resumes that includes passing initial

criteria such as experience, education, legal needs, certification etc.

- Conducting second level screening of the resumes that includes reviewing

each of the core competency of the position.

- The telephone interviews need to be carried out for the candidates who have

passed the first two levels of screening

- Determine the ways of informing the candidates about the whole recruitmentand selection process

Step 4: Conduct the interviews, asking the right questions

The interview is a process of carrying out two-way communication. Through

interviews an organization can seek to gain information regarding the candidate and

the applicant can gain knowledge about the company. This is the time for an

interviewer to do some talking and a lot more active listening. A sample of different

behavioural interview questions that can be asked during the interview are listed as

follows:-

Tool: Sample Behavioural Interview Questions

Decision Making and Problem Solving

- Provide me an example when you had to keep from contributing or developing

a decision because you did not have sufficient information.

- Give me an instance when you had to be quick while making a decision.

Leadership

- What is the toughest team that you have had to gain cooperation from?


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- Mention a time when you faced difficulty in gaining support from others

regarding your ideas? What approach was adopted by you and how did it

work?

Motivation & Initiative

- Provide me an instance when you went above and beyond the call of duty.

- Give me a situation when you were able to have a constructive influence on

the action of others.

- Mention a situation that needed many things to be performed at the same

time. How did you handle it and what was the result?

Communication

- Describe a situation when you had to be assertive so as to get a point across

that was significant to you.

Teamwork and Interpersonal Skills

- Mention a recent unpopular decision made by you and the actual outcome

- What have been done by you to contribute to a teamwork environment?

- Mention a circumstance where others working on an assignment disagree

with your views. What was done by you?

- Describe a situation where either you had compromised or guided others to

do the same.

Planning and Organization

- How do you make decision on what gets more priority while scheduling your

time?

- What actions are taken by you when your schedule suddenly interrupted?

Provide an example

Technical and Professional Knowledge

- Mention a circumstance under which you had to request for help or assistance

on a particular assignment.- Provide an instance of how you have applied knowledge from one task to

some other project or assignment.

- Mention a situation when you found that your performance is not satisfactory

as per the expectations of your manager or team leader. What action did you

take to improve it?

Step 5: Compare, assess and choose candidates

It is very important to look beyond the first impressions and look at the real

requirements of the position and the future demands of the company. In doing so,


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the actual needs of the job position have to be matched with the skills and abilities of

the applicant. Some of the basic individual features essential for resilient worker are:-

- Sense of individual beliefs and mission that is accordance with the values and

mission of the company

- Desire to make a difference in the working of the company

- Strong sense of effectiveness n performing the different activities

- Sense of belonging and personal price in the company and its mission

Below described is the formula of traits and core competencies that add up to make

a great hire.

Step 6: Make the offer

When a decision is made for selecting a candidate for a job position, implement it. It

is very important to be aware of the time it takes from the final interview to the final

hiring decision and the offer is made. Candidates have a feeling of urgency and must

be treated in a respectful manner. Following needs to be considered while making an

offer:-

- Assure that the offer is fair as well as competitive

- Follow-up the verbal offer along with the written offer, thus avoiding the

misunderstanding as well as possible confusion

- Discussing the offer in a direct manner with the candidate for clarifying thedetails

Great

Hire

Personality

- The indiivudla's self-awareness senitivity toothers and ability for

managing the relaions

Performance

- -The individual's job-

related skills andcommitment to

effectiveness

Character

- The individual's

underlying valuesystem, sense of mission

etc.


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- Celebrate

3.10 Internal Recruitment

Internal recruitment can be defined as when an organization selects the existing

employees already working in the company rather than recruiting someone external.

The advantages of the internal recruitment include the benefits gained by the

companies from their present workforce, provided that the workers are well aware of

their roles, understand the company completely and are competent enough.

Molander (1996) stated that the major advantage of internal recruitment is its

capability of creating an atmosphere of loyalty and job security among the workers,

which could be otherwise very hard and difficult to achieve. Another advantage of

internal recruitment could be that it helps in saving the time that would have been

spent on advertisements and also helps in lowering the training expenses that would

be needed by an external employee to understand the company completely.

Lockyer and Scholaris (2004) cited that an employer who selects to recruit internally

also understand the abilities of an employee in a better way i.e. reducing the risk of

selecting an unsuitable worker. Molander (1996) also cited that by using internal

recruitment, the workers will have rewards to stay in the company so as to climb the

career ladder. This provides a boost to their incentives for effectiveness and

enhances their productivity.

Internal recruitment has some disadvantages as well as advantages. According to

Ahrnborg (1997) the main disadvantage of internal recruitment is the restricted

supply of candidates to select and recruit from. She stated that the internal

recruitment can be an issue for lethargic firms, as a reason of insufficient influences

and the fact that they maintain their slowness and restrict their opportunities for

development. This insufficient development and new ideas can raise issues for the

firms maintaining their market shares because of threats from new products and

competitors. Another disadvantage recognized by Ahrnborg (1997) is that an

individual who fills the vacancy is leaving its position and thus a new vacancy will be

developed.

Lockyer and Scholaris (2004) stated another aspect of internal recruitment as that

the workers might feel that they need to be recruited due to the experience they have

but are not talented enough. Further on, during the times of recession, a

phenomenon might takes place that the firms are trying to maintain their workers,

and take internal recruitment to places and shift their workers to the positions they

are not competent for.

3.10.1 Stages involved in Internal Recruitment

There are six different stages that are involved in the process of internal recruitment.

These stages are described as follows:-


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Publication Vacant internal posts need to be posted through the developed

communication channels of an organization that includes intranet, notice boards in

the power stations etc. for fixed duration of time. During this time, the applicants can

convey their interest through e-mails to the supervisors or managers.

Application

All the applicants applying for the vacant position will be requested to

send an e-mail, which should also include their reasons for applying. All the

applicants will then be sent their resumes to bring it up to date.

Pre-selection The candidates who satisfy the requirements of the vacant position

the best will be asked for an interview. The applicants who will not be selected for

the interview stage need to be informed with immediate effect that their application

has been unsuccessful because of them not fulfilling the needs of the position.

Assessment All the candidates who are pre-selected will go through the different

phases of selection performed by the department of human resources and the headsof the department where the vacancy exists.

Selection & Appointment The candidate who will be satisfying the needs for the

new position will be chosen and will then let the head of that particular department

about the promotion. The people involved in the whole process need to come at an

agreement about the start date of the new role.

Closing of the Selection Process The candidates who will not be successful

should be informed of the reasons behind their non-selection.

3.10.2 Advantages and Disadvantages of Internal Recruitment

Advantages

- It is less expensive that the process of external recruitment

- Better knowledge of the abilities and skills of the internal applicants than the

external pool of talent

- Internal recruitment will improve the commitment of the organization as a

whole as well as job satisfaction

- Internal recruitment will improve the organizations culture and would carry on

his duty successfully without any hesitation.

- Promotions in the job will help in increasing the confidence of the workers,

thus assuring improved and better performance of the role.

Disadvantages

- Promotion can be painful for the ones who do not get promotion, so the

confidence could be down

- Change is sometimes necessarily significant for the companies and the

continuity is not profitable for the company


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- It hinders the new ways of performing things and the same mistake can be

repeated with the continual actions and decisions made by the managers

- Internal recruitment politics might have the more impact on process of

recruiting and selecting internally than external recruitment

3.11 External Recruitment

The process of external recruitment is when an organization is recruiting workers

outside the company. Usually an organization is making use of another company for

the recruitment of new workers. The key advantage of doing this is that the

organization then can emphasize on their necessary activities and not spend both

time as well as resources on finding the new skilful employees. The organization can

also look for and hire new workers by themselves. The companies can carry out this

process by using different tools such as advertising.

The most significant advantage of the process of external recruitment is that the

organization has no restricted supply of applicants and can select the workers from

across the globe. As per Duggan and Croy (2004), a problem with external

recruitment is that it can be difficult to put words on what particular abilities needed

by an organization and in this way cause issues because the consultants

misunderstand as well as hire an individual who does not fit for the role. Another

disadvantage associated with the external recruitment is that it can decrease the

efforts of present workers, because of insufficient promotion opportunities. Chan

(1996) claimed that it does not have to be a drawback or disadvantage when an

organization uses combination of both internal as well as external recruitment and infact can turn it into advantage by increasing the motivational level of the workers,

because of the fear of external recruitment.

3.12 The significance of keeping the right workers

A man was walking down the street, carrying a heavystone. A passer-by asked him

why? He replied, I am a slave; I have to do it; I am ordered to. Another man was

walking down the street, carrying a heavy stone and was asked why. I am building a

Cathedral, He replied-ANON

Motivation verifies why or even if, an individual gets up in the morning. It is difficult to

measure and cannot be reviewed easily. Motivation is related with the incentives

which make people act in a particular manner. Whiteley (2002) cited that the

organizations with effective methods and approaches towards motivation seek to

coordinate the aims of the individual workers with the wider aims of the business.

Organizations make use of reward systems for many different reasons and among

them one is to motivate the workers. The definition of motivation as defined by the

Business Dictionary is:-


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Motivation can be defined as the internal as well as external factors that inspire

desire and energy in the individuals to be continually interested in as well as

dedicated to a job, role, or position and to exert determined efforts in accomplishing

the goals. Motivation is the stimulant of performance and mother of all the actions. It

leads from the interactions between both the conscious as well as unconsciousfactors like:-

- Passion of desire or need

- Inducement or reward value of the purpose

- Expectations of an individual and of his/her significant others

Management of an organization usually considers clear and well defined objectives,

right administration and planning as the most significant factors for the achievement

of profits and benefits in a team or group. But due to the huge and fierce competition

now-a-days, many firms are gradually looking more likewise in terms of what is being

produced or offered by them. And due to this, soft values are gaining more

importance. As cited by Hessner (2009), How we perform activities or things is more

important than what we do. But the issue with soft values is that it is difficult to see a

direct outcome from making an investment in it. For an instance, when making a

comparison in investments made in developing the leadership skills with a marketing

campaign, the outcome from the marketing campaign will have a high level of

visibility. (Hessner, 2009)

The view of human resource is emphasized on the abilities of humans and

companies and the way through which the relationship among them is shaped andmaintained. In the 1930s, it was discovered by Hawthrone that when the workers feel

recognized they perform in a better and enhanced manner. This was developed by

McGregor into his theory of X&Y. Where theory X assumes that the workers are lazy

and thus need to be forced to perform and theory Y assumes that the workers are

encouraged and motivated and desire to work but get lazy when their expectations

are not satisfied. Bolman and Deal (2005) asserted that the organizations have to

therefore try hard to give their workers opportunities to come up to their requirements

when they are performing their roles in the company. In this way, the workers remain

encouraged and willingly stay in the company.

4. EMPIRICS

This section forms the part where the author has used the collected information from

the interviews and surveys, integrated with the second hand sources from the

companys annual reports and information balance sheets. The author has

separated this section into two different segments i.e. one part representing the

views of management and the second part includes the information gathered from

survey, which aims to portray the views and perceptions of the workers.


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4.1 A brief overall introduction to the hotels where the interviews were held

4.1.1 ETAP Hotel Introduction

ETAP is a European chain of basic-service budget hotels that is owned by the Accor

Group. The group has many branches all over the world i.e. Asia and Europe. The

main competitors of the chain are the likes of Holiday Inna and Travelodge in Europe

and in the UK. The rooms of the hotels are well furnished and include basic

amenities like small desk, television, a shower and other basic necessities. The

company owns nearly 370 hotels within Europe and most of them are located in

France.

ETAP Hotel Worldwide

An Accor brand, ETAP hotel performs its operations in a network of 462 hotels with

over 41,000 rooms in around 15 nations across the globe. ETAP hotel is the leaderin Europe in the segment of budget hotels with more than 400 hotels and 34,000

rooms in 10 different nations. The company has been planning to expand its network

of operations in over 500 hotels as well as 45,000 rooms in nearly 20 nations. The

customer trend of the company includes 60 percent business customers and 40

percent leisure clients.

The company owns attractively priced as well as superior quality chain of hotels.

ETAP hotel provides its customers with best low cost product in the industry i.e.

highly affordable prices such as 34 in the UK. The company offers a comfortable

accommodation that includes a toilet and shower and in addition to this a television

that offers the customers with an access to a wide schedule of programs. The hotels

are also equipped with WiFi internet accessibility.

The author has selected an ETAP hotel that is located in the town of Hounslow in the

UK. The author made his interview with the HR manager of the company who has

been working for nearly 5 years in the hotel at different positions. The manager

began his job as a receptionist and advanced to become a supervisor. The HR

manager of the hotel is responsible for recruiting the employees and also to make

operative decisions of the hotel. The role of manager of the hotel can be easilycompared with the position of a CEO if ETAP hotel would have been a private hotel,

instead of a crucial part in such a big hotel chain. She is a very effective and good

example of an internally recruited manager. She began as a trainee during the

summers and continued after ending up being the director of the hotel. the

knowledge, experience and position of the manager made her appropriate for the

interview.

4.1.2 Days Inn Hotel Introduction

Days Inn is among the most popular as well as the leading brands around the globe

that is being owned by the largest group of hotels in the world i.e. Wyndham Hotel


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Group. It has been ranked as the fifth largest brand after the Hilton Hotels and it is

the largest mid-range brand of hotels around the globe. At present, Days Inn is

among the fastest growing global hotel brands on the UK with over 321 hotels in the

UK and more than 52,000 rooms.

The friendly workers of the hotels love to make their guests and customers feel

totally comfortable. The company has always been known and recognized for its

friendly service, comfort as well as value. Now that the re-launch of the Holiday Inn

across the world has completed, both the business as well as leisure travellers are

finding the offers of Holiday Inn even better service and quality.

The author has interviewed the HR manager, who has been working in the hotel

since 2005 where she had held different positions. She began in the restaurant and

advanced to become the kitchen manager. There she notified that how much interest

she had in providing education to the workers, an interest that she wanted to extend

and thus applied for the role of HR manager. With some education being offered by

the company and her experience she managed to get the role. She holds the

responsibility of hiring the individuals for various positions and is active when the job

interviews are conducted.

Overlooking Table of Examined Hotels

ETAP Hotel Days Inn HotelNumber of stars 4/5 4/5 deluxeNumber of rooms 194 349

Turnover () 63 Millions* 112 Millions** Approximated numbers being told by the respondents

4.2 Incentive Compensation Systems

4.2.1 Days Inn Hotel

There are many different ways of describing the incentive compensation systems

and there are no established guidelines that must be followed by every organization.

The manager of Days Inn Hotel i.e. Martina Garrod describes it as an organization

with a strong working culture where tokens of appreciation are handled betweenthe workers. She stated that service as well as attitude towards the customers are

very crucial for success and for doing that, they must assure that their workers are

encouraged to delight the customers and provide them with quality services. Also the

workers should take into consideration that only one bad experience to turn a

customer off, but many good and effective ones to make them happy and satisfy

their expectations. Indeed, a customer who is not satisfied will tell ten people, as

compared to a happy customer who will be telling only three. What they want to

achieve with their incentive compensation systems is thus to encourage the

employees to behave in these enviable ways.


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To provide strength to the incentive compensation system of Days Inn hotel, it

depends on non-financial performance measures and is described in monetary

rewards. The monetary rewards include two different systems; the Yes I can- rose,

that is provided to the worker who has performed more than well towards the

customers and is thus, handed out some bonus in their next pay. The second, largercompensation is the Worker of the year, which mainly depends on the attitude

towards the colleagues so as to stimulate the right kind of attitude among the

employees, but also on the behaviour towards the customers. The worker receiving

this reward will be provided a huge sum such as 1500-2000 in his or her next

wages.

Martina Garrod stated that the workers felt being an integral part of the company and

that they enjoy in performing their roles. The motivation of the workers is measured

through an annual survey, designed and developed by an external organization.

Days Inn used to follow a piecework system, where the employees were paid

additional as a result of the extra services offered. The company decided to remove

this system because of decrease in quality in the services. A good example of this

was the section of house-keeping, where the payments of the cleaners were based

on the number of rooms being cleaned by them. The results from these incentive

systems were that the cleaners became burnt out, the sick listings went up and the

quality of the cleanings fell. The workers were thinking more regarding their self and

also regarding the potential bonus and the competition among them were reducing

their level of cooperation. Consequently, the quality of the services provided to the

customers was in this way reduced.

4.2.2 ETAP Hotel

ETAP hotel is a lot different in regard with the incentive compensation systems from

Days Inn hotel. Days Inn majorly emphasizes on the smaller monetary rewards,

depending on the non-financial measures, adjusted for the hotel industry. The most

common were; small bonuses being paid to the workers every time they managed to

make a booking and some kind of competition among the kitchen staff who managed

to sell more items. When measured through the surveys, the others mentioned

measurements were satisfaction of the customers as stated by the manager of ETAPi.e. Linda Bruce.

Whereas Days Inn gets rid of their piecework system, Days Inn makes use of a

system that resembles that kind of incentive compensation system, but instead of

measuring exactly the number of rooms cleaned or the number of customer being

served, they make use more of a guess to decide which employees will be receiving

the extra salaries. This extra salary is derived from the collective pay agreements

raises, HRF, where some percentage is the raise that is received by everyone and

the rest of it works as a built up pot, where the ones who performed extraordinary

receive those additional percentages. (Linda Bruce)


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The factors that are utilised for distributing the money in a fair manner are: attitude

towards the customers, capability of cooperating and willingness to educate them.

The manner in which manager assess the achievements of the workers are

subjective, which Bruce mentioned as made it difficult to divide the money objectively

and in fair way.

Linda Bruce told the author that the crucial success factor is to provide the

customers with the high quality services; otherwise they would lose both the

customers as well as sales. To be able to offer this quality it is significant that the

workers feel that it is fun to work with. If it is noticed by Linda that someone in the

staff is not being encouraged, she tries to speak with the person and solve the

situation as soon as possible. The reason behind someone being not encouraged is

almost always the same ad because the individual has been performing the same

task for a long time. Then, it is significant to give them with the new opportunities in

the hotel through new roles.

Bar Chart.1 Levels of Motivation

As it can be viewed from the survey, with a mean of 1.89, where 1 is the highest

value, the workers seem to be highly motivated, which was also described by the

management. Both the hotels have a strong organizational culture and soft valueshave become a lot more significant. Linda Bruce described that the workers at ETAP

hotel felt like being a part of the company; and they enjoy performing different

activities. The same results are observed in Days Inn, where they carry out annual

surveys of the workers through an external firm as stated by Martina Garrod.

4.3 Internal Recruitment in the hotels Examined

Internal recruitment in the hotel industry is often used where the supply of the

workforce is large and majority of the positions are rather standardized. In Days Inn,

internal recruitment comprises of more than 90 percent of all the recruitments, whichforms the major part of their strategy. When a position becomes vacant, Days Inn

0

2

4

6

8

10

12

14

16

Highly

Motivated

Motivated Neither not Not very

motivated

Not motivated

at all

Series 1


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announces the applicants eligible via internal webpage. It is worth mentioning that at

the same time the external recruitment is also followed but nearly 90 percent of the

positions.

ETAP hotel resembles the Days Inn in regard with the internal recruitment, where

most of the vacant positions are filled through internal applicants as described by

Linda Bruce. Majority of the job advertisements go through internal as well as

external portal, where both the internal as well as external applicants have a shot at

gaining the job. Even though they also post external advertisements, most of the

vacant positions are being filled with internal applicants, which can be explained by

the companys size and the high supply of candidates.

Martina Garrod also mentioned that the key advantage with internal recruitment as

being a cost as well as time saver. The workers who are recruited internally already

understand the company, its culture and philosophy, have been via internal

educations and grab a career opportunity. Linda Bruce mentions that is also a time

as well as cost saving, because of the fact that they will save time as well as money

to skip most of the introduction and learning phase. It was also mentioned by her that

they already understand the culture and the concepts that characterize ETAP and

offering the workers with a career opportunity.

Related with the disadvantages, both the respondents gave quite the same answer.

They mentioned that the major disadvantage as insufficient new blood, where

majority of the candidates hired share the same values and have the same internal

education and have insufficient new manners of thinking and experience from thedifferent hotels, where they were expert in some activities and could bring knowledge

and experience from those areas and execute them in ETAP hotel.

Martina Garrod told the author that recruiting the workers internally is not enough, as

the company is expanding and requires more workers. Linda Bruce told the author

that the best way is to combine both the internal as well as external recruitment. She

explained that she tries to be open-minded when it comes to an open position that

must be filled and stated that it is based on the position attained. For an instance,

she told the author about when they required a receptionist for the bight and over

300 applications were obtained. It took a lot of time for sorting these applications out.So it can be better sometimes to recruit an individual internally. Whereas on the

other hand, when coming to recruiting a person as barkeeper and someone in the

crew heard rumours regarding a good fellow working in another bar then maybe the

best solution would be recruiting and employing him.

4.3.1 Internal Recruitment as an Incentive Compensation System

Days Inn Annual Report (2009) cited that in the large hotel chains, the career

opportunities are large and even global. With over 400 hotels located around Europe

and the Middle East, Days Inn tells that the company can offer a diverse range of jobpossibilities. And considering that majority of the vacant positions are being filled


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internally, the opportunity to a carrier within the organization exists for sure. But for

internal recruitment to act as an incentive compensation system in Days Inn, the

workers must be prepared to move. Martina Garrod differentiated among two sets of

workers, those who are driven and really need to climb the career ladder and those

more concerned regarding their family as well as routine life. Martina Garroddescribed that internal recruitment acts as a key factor for encouraging the workers

to work and remain in the hotel.

ETAP hotel is in similar kind of situation, being a larger hotel group with over 150

hotels in many different nations. The career opportunities as well as most of the

hotels are located in the Europe especially in the UK. Linda Bruce separated the

employees into two categories as done by Martina Garrod i.e. the youth and career

oriented and the ones who are mostly concerned regarding the safety of a stable

income and job security. For the ones in the first category, internal recruitment is

considered as the key incentive to encourage the workers, under the circumstancethat they are

Documents

Recruitment Dissertation