Tuesday, July 26, 2011

Factors that impede the tight integration between business strategy and Human Resource strategies in the hospitality industry.

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Factors that impede the tight integration between business strategy and Human Resource strategies in the hospitality industry.

The integration of corporate and human resource strategy is one of the much-debated topics within the concept of strategic human resource management.

Truss and Gratton (14) describe strategic human resource management as the linking of HRM (Human Resource Management) with strategic goals and objectives in order to improve business performance and develop organizational cultures that foster innovation and flexibility. Thus, Strategic HR means integrating the HR function of an organisation with the companys strategy through HR activities such as recruitment, selection, training and rewards and any other HR activities specific to the hospitality organisation.

The necessity of this integration is demonstrated by Miles and Snow (14) who suggest that, without human resource strategies and policies linked into strategic business objectives, high levels of organisational performance are not likely.

Custom Essays on Factors that impede the tight integration between business strategy and Human Resource strategies in the hospitality industry.

There are, however a number of problems that arise in the process of this integration both within the concepts demonstrated by Hoque (1) as internal fit and external fit.External fit being the HR strategy meshed with the business strategy such that there should be a consistency between the values and aims within each. Internal fit therefore refering to

the introduction of HRM as an institutionally supported package of practices that cohere with and mutually reinforce each other i.e. employee policies, commitment, flexibility and quality of work.

It is to be argued that one of the main barriers to the successful integration of business and human resource strategy is the lack of commitment and understanding of management (both corporate and line management) to the cause of HRM integration.

Dyer and Holder (188) adopt the stance that top management is probably the most powerful force that can work against the adoption of HRM iniatives.

Whilst Kane (1) takes the view that, top management take a short-termist perspective on HRM because they believe that evidence of HRM having a long-term and positive impact on individual or organisation level performance is sketchy.

Kane goes on to report on the possible reason for senior and middle managers negative perspective on the value of HRM could also be attributed to their inability to establish tangible elements and positive outcomes directly linked to HRM therefore their commitment deviates or becomes non-existent.

Hoque, Ks (1) research into UK hotels indicates poor practice and a lack of interest in HRM among managers in the hotel industry.

Whilst, Tyson (17) portrays the attitude of line managers towards human resource activities as one of the key organisational features for successful HRM.

Due to management at a “floor” level being at the source of HRM in terms of its implementation at an operational level, line managers can been viewed as a major barrier to impede the integration of corporate and HR strategies.

It is therefore suggested that if the integration is to be achieved to its utmost potential, management on all levels must realise the effectiveness of HRM policies and procedures and how to sucessfully immplement them into the organisation.

Taking all this information into account, the research undertaken by Hoque (1) into Human Resource Management and Performance in the UK Hotel Industry, takes a different stance suggesting that for corporate management to impede the integration of strategies, it is done so indirectly through taking a focus [within the business strategy] on cost reduction or on price factors [which] leads to sup-optimal performance within the industry.

Thus illustrating that corporate management should ideally emphasise an opposite quality- enhancer method with regard to service and the product in question.

Schuler and Jackson (187) reinforce this issue by arguing organisations that have a quality enhancement or innovation approach within its business strategy will make effective use of HRM. Thus leading to suggest that if the organisation has to priortise cost reduction within its strategy, the logical approach to deal with the issue would be to emphasise numerical flexibility and cost control.

However, this deviation does not fully resolve the situation as, if cost reduction is priortised within the business strategy, it could potentially upset policies and procedures that have been instilled by the HR Department.

These policies and procedures will be discussed later in the essay.

Hoque (1) also puts forward the view that HRM practices implemented in a seemingly piecemeal and uncoordinated fashion have fewer benefits, which is true of practices in any hospitality department.

In order for said practices to be otherwise strategically implemented in a fashion relevant to the firm, a functioning, effective, well supported Human Resource Department must be in place. This point being relevant to any organisation which wishes to advance its performance through the aims and objectives outlined in its business strategy.

The level at which HR staff are proactive/reactive to their role within their department can also be foreseen as a major contributing factor to the integration of the aformentioned strategies.

The view that staff within HR departments, are lacking knowledge in their field, are poorly trained and most importantly have an overall ineffective presence in terms of tangible results, is one held widely throughout not only the hospitality industry, but across many other industries. As Kane, Crawford and Grants (1) research shows, there is a general agreement that they [HR managers] lack the knowledge, skills, influence, credibility and perspective on their roles to implement a strategic approach to HRM.(MORE THAN ONE QUOTE!!!)

It is therefore vital that the Human Resource department takes a proactive approach to their roles within strategic plans and subsequent activities undertaken, as Tyson, S (DATE) suggests, strategic HRM will not occur unless the human resource professional takes steps to make it happen.

In terms of HRM the HR department is the first point of contact in a hospitality establishment for employees and line managers. If the knowledge of the staff in the HR department is sub-standard, the information, policies and procedures that are passed onto managers/employees could be of comparable relevance. This potentially may lead to the integration between the two strategies being even further impeded.

Therefore the HR department must not only possess the basic skills of Human Resource management, but also realise the individual features of the business strategy the company is adopting, how the strategies support each other and their role to support the fit between the two. Through this, the department can then adopt its policies and procedures to suit, but can also recruit, select, train and reward employees according to a set strategy.

HR staff therefore need to be able to realise the importance of their actions and how it impacts on the integration of the business and HR strategy.

If their signifiance to the strategy is realised and the support given from management is forth-coming and effective, the “fit” between strategies potentially can be achieved to a greater degree.

The previous factors of management commitment to the integration between business and HR strategies and the relevance of HR staff have both been shown to be of significant importance when integrating strategies.

However, the current state and perception of HR as a concept and its relevance to the hospitality industry, is a factor that if not shown to demonstrate its relevance, may have further detramential effects on the aforementioned elements.

Price (14) enforces this statement by arguing that practices in the hotel industry were so far removed from both the personnel and industrial relations and the human resource management ideal types, that neither model should be used to inform research on the [hotel] industry.

Whilst this representing one end of the spectrum, the relevance of Human Resources to the hospitality industry is a widely debated and much critisised one.

This factor is of significant importance when linking back to the previous areas of management and the HR department. Management have already been shown by Kane and Crawford (1) to need tangible and positive outcomes to comprehend and support the incorporation of a HR strategy whilst also realising the potential it has to work positively and help make strategic, informed decisions for the organisation.

Kane and Crawford (1) state that, there is considerable agreement about the lack of proven knowledge and the difficulty in quantifying the results of HRM, thus not supplying the essential tangible results.

The acknowledgement of opinions by managers/employees in hospitalitycould lead to possible cynicism from managers/employees in hospitality when required to adhere to policies and/or procedures set by the HR department.

Sisson (1) reports findings of only fragments of HRM being found in his study of UK hotels, this in uxtaposition with Lucass (15) view there is sparse evidence to be found of any UK hotels that have taken HR “seriously onboard”, lead the reader to a fairly poor outlook on the current state of HRM in the hospitality industry.

It is therefore made all the more clear that in order for HR departments to effectively integrate with businesss strategy, they need to have clearly defined policies and procedures to lead tothe tangible results when dealing with an organisations personnel. Legge (15) suggests the soft approach involving encouraging motivation, development and commitment. This methods main emphasis is on developing a workforce that is innovative and of a valued resource to the company therefore emphasising self-development.

Hoteliers such as Malmaison and the Hilton (REFs www) group can be used as examples of companies that employ a variety of soft models when dealing with policies and procedures, due to their detailed training methods, appraisals and procedures that encourage employee feedback.

The hard method on the other hand is more closely tied with the business strategy and is suggested to be used by companies with a stress on cost control due to its strict reliance on policies and procedures. The outcome of this being that it leaves minimal room for employee innovation and development.

Schuler (18) has undertaken research into cost reduction and quality enhancement strategies, even though the context is aimed more towards the manufacturing and industrial sectors, the basic principles are demonstrated to have hospitality relevance.

His evidence takes the skeptical view that as predictable as the outcomes of the hard model are, the relevance and existence of a HR department comes under question as reliance on this model means power rests in the hands of the top executives and designers of the workflow processes.

The negative aspects of the “hard” model being the effect on staff morale and motivation as there is little room left for deviation from the policies and procedures potentially leading to increased employee turnover.

However, the positive aspects of employing this system being the low level of un-certaintity due to the predictability of competition and customer behaviour.

The obvious examples of hospitality firms that employ this system being major standardised fast food chains and quick service restaurants.

The logical approach when considering the application of hard and soft HR models would be to integrate models that compliment each other. As previously discussed the concept of fit is all important when discussing the integration between the two strategies in question, however this concept of close fit may contradict the elements of the soft model. Due to the hospitality industry being renowned for cutting costs/corners through minimum wages, low quality service and products, this may be the reason why HR strategies have failed to have a positive impact.

Therefore; it is essential that HRM practices are consistent with what the organisation is trying to achieve otherwise, as Schuler (18) reports, role conflict and ambiguity may result in poor individual employee performance and affect the organisational performance of the organisation.A point argued by Tyson, S is that without human resource strategies and policies linked into strategic business objectives high levels of organisational performance are not likely. If this resource is successfully employed, the concept of HRM depends on how it is applied in a work situation and the tangible outcomes of integrating HR into a business strategy.

The evidence illustrated therefore demonstrates that the concept of fit between strategies lacks specific concepts and empirically elusive

The research conducted and points highlighted have shown that the aligning of business and HR strategies complex whilst there being a multitude of research conducted on the subject, the amount of research specific to hospitality is minimal.

Therefore the validity of HRM within the context of this essay depends on the extent to which human resources are used for the achievement of competitive benefit and added value to the firm and therefore should be treated one of the organisations decisive strategic resources.


In search of HRM Sission K British Journal of Industrial Relations 1

Strategic Human Resource Management and Industrial Relations R.S.Schuler

Human Relations Volume 41 Number 18 pp157-184

Human Resource Management and Performance in the UK Hotel Industry Hoque,K

British Journal of Industrial Relations September 1 pp41-44

The Practice of Human Resource Strategy, Tyson S, Pitman Publishing

Barriers to effective HRM Kane, B and Crawford, J International Journal of Manpower Volume 0 No8 1 pp44-515

Linking Competitive Strategy with Human Resource Management Practices Schuler R.S and Jackson, S.E The Academy of Management Executive 187 Volume 1 No pp07-1

HRM in Hotels a Focus on Commitment, Guinngle P.J and Jameson S, Employee Relations Volume No 4 00 pp40-4

Human Resource Management a strategic approach to employment Hendry C Butterworth Heinemann 000

Introducing Human Resource Management nd Edition Foot, M and Hook, C, Longman, 1

Lucas, R. (16) Industrial Relations in hotels and cateringneglect or paradox?, British Journal of Industrial Relations Vol. 4 No pp. 67-86

Price, L. (14) Poor personnel practice in the hotel and catering industry does it matter? Human Resource Management Journal Vol 4 No 4 pp.44-6

Sission, K.(10) Introduction Human Resource Management Journal Vol.1 No.1

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