Introduction
According to Wood and Brotherton (2008, p.440), in the modern world, there is increasing competition in different industries. This has resulted from globalization, and the adoption of modern technologies. The intensifying competition has forced companies to develop strategies to sustain their survival.
As such, strategic human resource management has been one of the areas where companies have been forced to improve competitiveness. Various challenges have been experienced in the field of strategic human resource management. For instance, change management has been a significant challenge to the manager because the business world has been turbulent.
Many changes have been happening, and keeping in touch with new business aspects being introduced has been a considerable challenge to many companies in the market. The application of technology has also been a serious challenge in developing strategies to manage organizations.
In addition, high employee turnover has been experienced in organizations. The challenges in the management of human resources have caused the development of strategic human resource management in organizations (Information Resources Management Association International Conference, & Khosrowpour, 1991, p. 149).
This assignment is a discussion on the topic of Strategic Human Resource Management (HRM). Of main concern, is how strategic HRM can help organisations face the challenges of the future as well as strategies for managing change. The discussion achieves this through the use of the hospitality industry.
It looks at contemporary issues, which can be challenges to the industry, why the issues are a challenge and how strategic HRM can be used to address the mentioned challenges. The challenges to be discussed include technology, the threat of terrorism, human resources (staffing), marketing and economic challenges.
The discussion begins with a brief overview of the concepts of organisation, strategic human resource management and organisational change. It then moves to tackle the challenges facing the hospitality industry and how strategic HRM can be used to overcome the challenges.
Aim and Objective
The aim of this assignment is to explore the aspect of strategic human resource management. The objective of the assignment is to explore the challenges facing the hospitality industry as well as how the HR officials can overcome the challenges. The objective will be achieved through articulating the issues which are challenges to HR in the hospitality industry with the possible solutions to overcoming them.
Definition of terms
An organisation is a group of people who work together with coordinated efforts to achieve certain objectives or goals. Organisational goals and objectives are of various categories, and it is this variation of goals and objectives which classify organisations into three main categories namely profit making, service based and social responsibility based organisations (Murray, Poole, and Jones, 2006. p.45).
Service based organisations may be profit making or not profit making or both. Service based organisations make a profit through providing certain services to people. The same organisations may offer services for free or as a corporate social responsibility. When offered for free, services are usually paid for through charity by donor organisations.
For example, while an organisation concerned with the provision of resort facilities may provide the services purely on business terms, it may engage itself in corporate social responsibility activities like fighting hunger and poverty, conservation of the environment as well as economic (training communities on entrepreneurship and giving them soft loans) and educational empowerment (sponsoring needy and poor children to acquire education) of communities.
These corporate social responsibility activities strengthen the bonds between the organizations concerned and its customers (Maier, 2009).
The study of organisations is made possible by the use of organisational theoretical models or approaches. These theoretical models are mainly used to explain organisations in terms of structure and culture. Organisational culture refers to shared beliefs, values, norms and practices which characterise an organisation.
Organisational structure refers to how the organisation is structured, how power and authority to make decisions are distributed along the structure of the organisation and who takes what directives or instructions from whom and when (Robbins, 1996, p. 29).
Strategic human resources management is about using minimum resources to achieve maximum results. It is also about remaining relevant in the market, which is achieved through being innovative as well as introducing the necessary changes in a business or organisation.
The implementation of any changes in organisations needs to be taken with caution because employees are social beings complete with feelings, perceptions, needs and expectations. Change management completes the package of strategic human resources management.
Strategic human resource management emphasizes on utilizing the minimum human resources at the lowest cost possible to maximize the benefits and profits of the company or organisation. It also emphasises on motivating employees depending on their individual efforts and commitment to the company but not on collective efforts as in traditional human resource management (Maier, 2009).
Organisational change may occur as a result of internal or external forces. Internal forces may include things like growth and expansion, bankruptcy, change of objectives, acquisitions and mergers, adoption of new technology and change of policy.
External forces of change are the things which an organisation is not able to control and may include things like competition, political or social risks, economic recessions, unfriendly or harsh taxation polices and unpredictable business environment (Kezar, 2001).
Organisational change may be of various types. It may be planned or unplanned. Planned change is the one which involves a conscious effort to introduce new procedures or do away with old ways of doing things in an organisation. For example, an organisation may decide to merge with another organisation or acquire its properties due to the similarity in objectives (Kezar, 2001).
Unplanned change is the one which occurs spontaneously without any conscious effort to plan and execute it. Unplanned change may have negative or positive impacts on an organisation because the organisations are not prepared to handle the change. A clear example is the external requirement by some authorities to comply with certain guideless like environmental regulations (Kezar, 2001).
Change may also be gradual or transformational. Gradual change occurs in an incremental manner in which one aspect of change is introduced at a time, and then the subsequent aspects are introduced as the organisation stabilizes with the initial changes.
Transformational changes are radical in nature and involve the introduction of multiple changes at a go. The changes may be as a result of internal or external forces and may be planned or unplanned (Kezar, 2001).
Discussion
The Service Industry
The economy of any country is composed of three main pillars namely the primary pillar, the secondary pillar and the tertiary pillar. The primary pillar is composed of those activities which generate revenue from primary production of products, goods or services.
Examples include mining and agriculture. The secondary pillar is the one which generates revenue to a government through the processing of the products of the primary pillar (Walker, Miller and McBee, 2009).
The third pillar is called the tertiary pillar (service sector) and involves the generation of revenue mainly through the provision of services using a wide range of knowledge and professionalism. In a business context, the service sector may provide its services to consumers and businesses equally (Walker, Miller and McBee, 2009).
The Hospitality Industry
The hospitality industry lies under the third pillar of the economy of any country. It is primarily concerned with the generation of revenue from the provision of a wide range of services which enable people to spend their leisure time effectively and conveniently.
It includes services such as catering, lodgings, planning and logistics for various events, resort services and general tourism services (Walker, Miller and McBee, 2009).
This sector is one of the key sectors of the economy which generate a lot of revenue to any government. If properly planned and managed, it can be an exceptionally reliable source of income for a country. Taking the example of tourism, a country may invest a lot of resources in this sector so as to make substantial returns from it.
The government may embark on the conservation of natural resources like forests and would life as well as culture. These may be exceptionally strong attraction for the tourists. Upon arrival in a country, tourists need places to stay; means of transport as well as people to guide them and translate the languages for them.
Through the visiting of tourists, the host country may generate a lot of money within an extraordinarily short time (Maier, 2009. There is the need to have in place a sound strategic management infrastructure so as to maximize on the financial returns, due to the ability to generate massive financial returns.
Even though, it is a multi-million industry, the hospitality industry is faced with a couple of challenges which are related to strategic HRM. The issues may manifest themselves directly or indirectly and may have a wide range of effects on the industry. The three most common contemporary issues facing the industry are discussed below.
Current Issues Which Can Be Challenges in Hospitality Industry and how they relate to HRM
The issue of terrorism
One of the contemporary issues facing the hospitality industry is safety for the tourists. The issue of safety became an issue of concern to the hospitality industry after the September 11 terror attacks on the United States.
These attacks sparked a wave of fear and uncertainty among and between nations as well as intense hatred between the western countries, majorly the United States and its allies and the rest of the world (Barrows and Powers, 2008).
Following the attacks, many managers of hotels and resort services around the world have been speculating about the stability of the industry especially due to the threat of retaliatory attacks by terrorists. This has made many governments invest a lot of their resources in managing their image abroad so as to instil confidence in tourists.
It is necessary to note that a country, which does not have peace, may not attract international tourists. Peace and safety, both for the citizens of a country and for foreigners is a pre-requisite for a stable hospitality industry (Walker, Miller and McBee, 2009).
The issue of terrorism is a challenge to HR because managers have to spend large resources and time trying to convince their potential customers that their facilities are safe especially to foreigners.
Human resources
The other issue of concern to the hospitality industry is the issue of human resources. Many of the countries do not invest a lot of human resources in the industry due to lack of commitment and the will to maximize the collection of revenue from the hospitality sector.
Many hotels do not have adequate personnel to handle large numbers of tourists. In some situations, especially in the developing world, some hotels have been unable to serve a large number of tourism due to a small number of employees. Such countries usually have a limited capacity to handle international tourists, which leads to massive loss of revenue (Hayes and Ninemeier, 2008).
The issue of technology
Technology has been a serious challenge in the hospitality industry. Technology has been revolutionizing virtually all sectors of the economy. The funny thing with technology is that it keeps on changing, and what is advanced technology today becomes obsolete within a few days.
The changes in technology impact the way people relate, associate and do business with each other. Some of the aspects of technology which have been changing the way people relate and do businesses across the globe include Facebook, twitter, my space, electronic funds transfer, online purchasing and selling as well as booking of transport and accommodation facilities (Kusluvan, 2003).
The innovations in the fields of information and communication technology have made many organisations keep on changing their systems so as to remain relevant in the current business environment. Those organisations which do not embrace technology are been faced with the threat of becoming obsolete or irrelevant in the market.
This is because many customers prefer to use communication technology in virtually all aspects of their lives including education, travelling and access to a wide range of basic services (Allison, 2010).
This becomes a challenge to HR because employees have to be given constant training on the emerging technologies. This requires massive financial resource which may not be available in many organizations.
In the hospitality sector, technology can be used in the booking of accommodation and travel services as well as the paying for such services. Many hotels and other hospitality organisations have embarked on an on-going upgrade of their systems.
This upgrade and adoption of new technology in the hospitality industry requires a lot of financial resources as well as expertise. The hotels should have websites which contain all the information about the services which they offer.
They are also obliged to do a lot of online advertisement and marketing of their hotels because most of the potential tourists cum customers rely almost entirely on the internet to get information on the best places to go and spend their leisure time and holidays. This becomes a challenge for HR because it requires large financial resources and time.
The issue of marketing
Traditionally, the hospitality industry did not attract the attention of many investors because they perceived as a reserve for governments and large corporations. However, this has changed. Many private investors are now engaging in the business of providing tourism services and facilities.
This can be attributed to the liberalized economies which have seen many banks become more willing and able to give private investors hefty loans to invest in the industry.
This has increased competition in the hospitality industry thus creating the challenge of marketing. Managers in the hospitality industry are now obliged to do a lot of ground work in studying the market and coming up with marketing strategies, which increase their competitive advantage. The challenge for HR is that marketing is an extremely expensive, technical and time consuming exercise.
The issue of global economic recession
Since the start of the year 2008, the world has been undergoing through difficult economic times similar to those of the great depression of 1930s. The recession has affected many economies of the world, including the United States which is known as the world’s super power.
Currently, the United States is grappling with the ever increasing economic deficit (Keys and Fulmer, 1998). Many businesses have also been affected by the recession. This has forced them to lay off their employees so as to cut on their expenses in order to remain in business. The service sector has not been left out.
Many governments and private investors in the hospitality industry have reported reduced number of tourists or customers of their services or facilities. This has made it a challenge to the managements to sustain the businesses because the reduced number of customers means reduced profit.
Some of the managers in the industry have also embarked in early retrenchment or laying-off some of their employees due to the global economic recession (Keys and Fulmer, 1998).
Why the Issues are a Challenge to HR within the Hospitality Industry
The issue of terrorism is a challenge to HR in the hospitality industry because many tourists have the fear of visiting countries, which may be tagged as supporters of terrorism.
This is a considerable challenge for human resource management because they have to do a lot of ground work to clear image of their country at the international level through the use of various types of media and marketing channels.
It is also a challenge because many hotels rely on international tourists for their income. If the number of tourists is reduced, the income for the hotels also decreases meaning that jobs may be lost as well as large lose in revenue.
The worst thing with terrorism is that the terrorists are not predictable. It is not easy for any country to predict where the terrorists may strike next. It becomes exceedingly tricky for the human resource management to know how to deal with the challenge.
The issue of insufficient human resources in the hospitality industry is a challenge because it makes organisations in the hospitality industry lose a lot of funds due to their inability to handle a large number of tourists at any given time.
While the management of the hospitality industry may want to increase the number of personnel, they also fear that the number of tourists may go down due to the threat of terrorism.
This makes them opt to operate with a minimal number of personnel, rather than engaging many personnel whom they may not be able to support in terms of remunerations. This in turn negatively affects the ability of the Hotels to maximize on their business.
The issue of technology is a challenge because as mentioned, it requires a lot of resources. For instance, it requires technocrats in the field of technology, who are conversant with the latest technology in the market.
These people are not easily available, and what this means is that the few who are there are extremely expensive to hire, especially in full time basis. Technology systems also need a lot of funds to install.
For instance, the development of electronic systems for booking of accommodation and travel facilities may require a lot of funds, which may not be easily available for many organisations. The challenge of technology is further complicated by the ever evolving nature of technology.
What this means is that an organisation may spend a lot of money in developing and installing a technology system, only for that system to become obsolete or out-dated within unusually short time thus calling for the adoption and installation of the newer form of technology. This affects HR in that lot f time and resources are used in the same.
The five issues of terrorism, technology, marketing, economic recession and human resources (staffing) stand out as key challenges facing the service sector in general and the hospitality industry in specific.
The reason why they are challenges to the industry is because the industry highly sensitive them. They can be explained as the corner stones of the industry because for any tourist activity to be implemented successfully it must be structured around these issues.
How Strategic HRM Can Overcome These Challenges
As I indicated earlier, strategic human resource management is about planning in advance so as to put an organisation in a better position to deal with any challenges which may occur in the future.
It is about positioning oneself in a good position in anticipation of any change or challenge in the market. Strategic human resource management can be used to deal with the issues outlined above (terrorism, insufficient personnel and technology).
For the issue of safety, strategic human resource management may be applied to make their organisations be on the safe side in regard to the threats of terrorism. One of the ways in which organisations may deal with the challenge of safety and terrorism is through offering pure comprehensive policy measures and guidelines on tourists safety during their stay in a country.
The information on safety may be included as one of the key points of the organisations so as to capture the attention of the tourists, most rely on speculations and hearsay when choosing the countries of destination.
The management may go a notch higher and offer some form of insurance cover to the tourists especially on any losses incurred as a result of terrorism. This may as well attract many tourists for a country.
On the issue of technology, strategic HRM may be used in coming up with adaptive mechanisms for ensuring that they remain effective in the market. They can do this through engaging on permanent terms of employment, a person who is solely responsible for monitoring and identifying any changes or modifications in technology and advising them accordingly.
Through this, the organisations may be in a position to anticipate any changes in technology and adopt the latest and popular as well as the most convenient form of technology in their processes, functions and procedures so as to remain relevant in the challenging business environment.
Strategic HRM may also be used to invent and popularise newer forms of technology. This may be particularly instrumental for the organisations because apart from being conversant with the form of technology which they invent, it also boosts their image at the international arena thus increasing their competitive advantage.
Strategic HR can also be used to deal with challenges to organisations through capacity building and training of employees so as to enable them to multitask.
Theoretical Perspectives to Organisational Change
There are various perspectives of looking at organisational change in terms of how it occurs, why it occurs and how to address the issues of resistance to change in organisations. The perspectives take the form of theories or models.
These two terms (theories and models) are used interchangeably although they do not mean the same. While theory is used to imply abstract insights to a subject, models are used to connote a set of procedures, methods or plans which may be used to undertake action (Kezar, 2001).
There are two main theoretical models of explaining and conceptualizing organisational change namely the Evolutionary and the Teleological models. The major distinction between the two is the manner in which they address the issue of determinism in the change process.
The Evolutionary model seems to embrace the idea of determinism in explaining organisational change while the Teleological perspective tends to de-emphasize it.
However, both models tend to conceptualize organisational change as a linear and rational process which occurs due to forces internal and external to organisations. Each of the models has got several other approaches of explaining and conceptualizing organisational change (Kezar, 2001).
Evolutionary model of organisational change
The major assumption in this model is that change in organisations depends on the situations and environments in which organisations operate. This model has its origin from the natural selection theory which was adopted in organisational change with the philosophy that change is always happening naturally, and no force can effectively prevent it from happening (Towers, 2008).
Later on, there emerged the Resource Dependence approach which purports that organisations can never be self-sustaining, but they rely on the external environment and resources and managers in organisations have to come up with adaptive systems to enable them to cope and survive in the ever changing internal and external organisational environments (Towers, 2008).
The Evolutionary model in general tends to emphasize on determinism that is, organisations operate in unpredictable socio-cultural, which automatically dictate how they should operate. According to the model, change occurs in a liner manner but may also occur spontaneously as the environment may dictate and managers cannot anticipate it.
Managers should embrace change, either from internal or external forces and develop adaptive mechanisms. Employees are supposed to understand and embrace organisational change without questioning (Towers, 2008).
Teleological model
This model is also known as scientific management or planned change. The major assumption of this model is that change in organisations occurs as a result of concerted efforts by organisational leaders who see the necessity of change, plan and execute it for the benefit of organisations.
This model is perhaps the most common in the literature of organisational change (Keys and Fulmer, 1998). Approaches, which lie under this category, include Organisational Development, Strategic Planning and Organisational Learning.
The Organisational Development approach is hugely popular in this category, and it involves managers doing an analysis of their organisations to know the problems they are facing and then coming up with solutions to these problems as well as strategies of how to improve organisational productivity using minimum resources (Keys and Fulmer, 1998).
The Change Process and Change Management
The change process can be contextualized using the Kurt Lewin’s approach to change management which falls under the category of teleological model of change. Lewin came up with what he called three stage theory which involves three stages or steps namely unfreezing, changing and freezing (Cummings and Worley, 2008).
In the first step (unfreezing), the organisation is supposed to be motivated and prepared for the change. The management must engage the employees and create a state of discontentment with the prevailing conditions in the organisation.
While doing this, the management should also ensure that they set out deadlines for themselves to come up with a new dispensation of doing things (Cummings and Worley, 2008). This stage is about doing a cost benefit analysis about the proposed change and weighing whether the pros of the change outweighs the cons, then creating the necessary motivation for the change.
This stage is the preparatory stage and is highly crucial because it determines the success of the change if effected. When employees are highly motivated to change, the resistance to change is minimized and vice versa (Cummings and Worley, 2008).
The next stage is the change stage which is also known as the transition stage and involves implementing the change. This is the hardest stage in change implementation because employees are always reluctant to move out of their comfort zones despite any motivation.
During this stage, employees need to be guided and encouraged to undertake the change. In order to realize a smooth sailing through this stage, employees need to be given the necessary training for them to acquire the knowledge and skills for navigating successfully through the transition stage (Cummings and Worley, 2008).
The final stage is the freezing stage, which is also known as refreezing stage. During this stage, the organisation has successfully sailed through the change process and is now leaving in a new dispensation.
There is the need of creating a new culture in the organisation which is in line with the new organisational dispensation (Cummings and Worley, 2008). This approach to organisational change has been criticized for being exceedingly simplistic especially in the way it assumes that people can be taken through these stages without difficulties.
Its critics argue that the approach is a bit mechanical and unrealistic. Despite the criticism, the approach remains common in the world of organisational change even today, especially in the preparation of employees for change mainly through doing appraisals and evaluation of organisational activities and their effectiveness (Cummings and Worley, 2008).
The practices of appraising and evaluating organisational activities and programs can be explained as a contemporary Lewins’ approach to organisational change, which may be described by many as a participatory approach to organisational change (Cummings and Worley, 2008).
Conclusion
This assignment was a discussion on strategic HRM and how it can be used to deal with contemporary issues in the hospitality industry. The discussion has found out that strategic HRM is an immensely valuable tool in addressing the issues of terrorism, economic recession, marketing, poor staffing of personnel in the hospitality industry and the issue of technology.
The issue of terrorism has emerged as the most serious one to the hospitality industry in the sense that safety is the most relevant criteria used by tourists when deciding which country to spend their leisure time and holidays.
The discussion has also discussed various theoretical perspectives of organisational change and a model for the change process and how organisations can sail through organisational change successfully.
The theoretical perspectives discussed include the evolutionary and teleological models of organisational change. The theoretical perspective for the change process and management which has been discussed is the Lewin’s approach to organisational change and management popularly known as the three stage theory which involves unfreezing, changing and freezing.
It has emerged that all organisations in the hospitality industry must be willing to commit a lot of their resources in publicity so as to attract as many customers as possible as well as increase their competitive advantage in the very crowded business environment.
Organisations must also consider engaging on a permanent basis of employment technocrats who should be tasked with updating them on the latest forms of technology used in the hospitality industry. The objective of the assignment has been met in the sense that the issues highlighted as challenges have been well articulated and possible solutions offered.
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