Audit of the Rocks Hotel

Audit of the Rocks Hotel

The Rocks Hotel has significant potential to be a world-class resort, yet must overcome significant process and system-related challenges from a Human Resource Management (HRM) standpoint first. The intent if this audit is to provide prescriptive guidance in the areas of staffing, training and development, employment issues and the alignment of the HRM functions at the resort to the Pacific Coast Hotels (PCH) strategic plan. PCH recently acquired the Rocks Hotel Resort, so this audit will be used as a framework for us with the subsequent acquisition in Thailand.

The Rocks Hotel Resort is in chaos from an HRM standpoint. There are no training programs, employment certification for hotel staff ranging from lifeguards to those in food service and catering, and no consistent standards in place for staffing and development. The net result is above-average turnover and very high costs being incurred from absenteeism, workplace injuries and a continual state of attempting to get new members of the workforce training and productive. Due to the complete lack of training standards there is also the potential for litigation due to the hiring practices in the food and beverage areas as the hiring manage openly admits to discriminating on women who are attractive. From that premise for a hiring decision, conditions can go bad quickly, inviting sexual harassment and discriminatory hiring practices. The conditions are such that the Rocks Hotel Resort is fortunate to not have been involved in human resources-related litigation yet. Much activity is needed to clean up these below-par practices in human resources management. The one positive note from this audit is that the concepts defined can be quickly applied to the acquisition in Thailand to ensure a high level of compliance to IHRM standards and local regulations about hiring.

Table of Contents

Introduction and Purpose

The Rocks Hotel Resort is the latest in a series of acquisitions by PCH, and the following HRM audit of their current recruitment, staffing, training and development, and resort management show drastic need for improvement across all areas. The purpose of this audit is to alleviate the systemic problems inherent in how Rocks Hotel Resort is being managed today, and in so doing define a framework for the next acquisition in Thailand. What is immediately apparent from the audit is the lack of a governance framework and structure that is critical for unifying each component of the HRM strategic plan and defining its contribution to the overall strategic plan of PCH. The role of governance is to galvanize all elements of an HRM plan first for consistency internally, and second for integration to the firms' overall strategic plan (Drew, Kelley, Kendrick, 2006). Clearly, this is not happening at the Rocks Hotel Resort at the current time as each component of the HRM strategy is not integrated to any other. The audit has shown that the Rocks Hotel Resort is experiencing exceptionally high turnover, absenteeism, workplace injuries while also not effectively utilizing customer satisfaction data to improve performance. Job descriptions and certifications for pool personnel, which as of this audit show none has lifesaving certifications, no cross-training or onboard training programs, and no employee management systems keeping all employees focused on a common set of objectives. There are also no clear goals defined for the resort. As a result, employees working in one department have no idea how their contributions affect the resort's total performance, including if their efforts are making a difference. When there is a lack of governance specifically in the area of cross-department coordination and workflow integration, employees often don't see the connection of their efforts to the broader accomplishment of a goal of objective (Carcello, 2009). Due to lack of governance and leadership, the Rocks Hotel Resort is struggling to operate reliably on a daily basis.

Situational Analysis

At the most fundamental and systemic level, the Rocks Hotel Resort lacks any kind of leadership culture at all. It is absent, and the pep talks and means of motivating through speeches are not closing the more critical gaps in recruitment, staffing, training and development, only making them more apparent by the very rapid turnover, absenteeism and workplace injuries. When there is a void of leadership culture, employees will not have a strong sense of purpose, lacking motivation to master their jobs, they will often seek other areas of mastery in their lives (John, McGuire, Rhodes, 2008). This lack of leadership culture is the catalyst of nearly every one of the problems that this audit has found. The ten functions of successful leadership as originally defined by Dr. Yukl and since analyzed in the context of leadership frameworks b Avolio, Walumbwa, Weber (2009) show that the endorsement of a cultural frame of reference first, even before mentioning strategy, sets the expectation and parameters of how any organization will operate over time (John, McGuire, Rhodes, 2008). The Rocks Hotel Resort has no such governance framework in place to execute a leadership strategy from. As a result, the attempts to motivate the various departments fails nearly very time. Despite "pep talks" and external motivation, the employees have a complete lack of internal motivation as evidenced by absenteeism, workplace injuries that are higher than average, and the threat of lawsuits and litigation of having a pool onsite with no one trained in lifesaving, resuscitation or pool treatments and testing as well. These factors and the lack of cross training as evident by one employees' response to a question during the audit further underscore how lacking a leadership governance structure is within the Rocks Hotel Resort.

The lack of governance structure at a strategic level has many symptoms present in how the resort is being run today as well. At the most central level, the lack of autonomy, mastery and purpose that the employees have about their roles in very evident on how each doesn't know what the other department does nor do they feel ownership of their jobs as well. When an organization lacks a governance framework and there is no leadership, employees find it very difficult to attain long-term learning in the workplace, as autonomy, mastery and purpose must pervade a company culture for self-learning to flourish (John, McGuire, Rhodes, 2008). At the most strategic level, the HRM audit indicates that employees see little connection between their long-term learning and the direction of the resort in terms of performance, and do not connect their efforts with the satisfaction of guests as the customer satisfaction data is handed back to sales and marketing for upsell and cross-sell of future visits. A more effective governance framework, supported by a leader with emotional intelligence (Kevin, Groves, Pat, Winny, 2008) and a transformational leader skill set (Howard, Bromley, Kirschner, 2007) is necessary for transforming the resort. This will most likely mean the current manager or director of the Rocks Hotel Resort will need to be replaced with a more senior manager, skilled in taking the many different functions and workflows of the report that are now either only partially working or not working at all, and transforming them completely. A proven characteristic of an effective leader is the ability to transform organizations (Ann, Pamela, Jerry, 2008). For transformation to take place at the Rocks Resort Hotel there will also need to be a much greater level of trust in the manager of the resort than there is today. Trust is the catalyst of an organizational culture changing and leaders gaining the credibility they need to transform processes, workflows and increase customer-centered performance (Ceasar, Suzanne, 2008). At present, the Rocks Resort Hotel does not have this, and is as a result struggling to meet customer expectations on a daily basis.

International HRM

The international aspects of HRM that the Rocks Resort Hotel presents are also multifaceted and revolve around the need for more consistency of leadership from both an emotional intelligence and transformative standpoint. The symptoms of dysfunctional leadership pervade this audit and show just how lacking any form of transformational and for that matter, transactional leadership is at the resort. With the recommendation made of replacing the manager and finding one more experienced with creating a unified governance structure than can transform the resort, the need for also defining strategies to enabling feedback to employees on their performance also needs to be acted on (Schaubroeck, John, Simon, Sandra, 2007). A major factor is the lack of autonomy, mastery and purpose throughout the resort on the part of employees is that they are not receiving any feedback at all. There are for example no performance appraisals or reviews given, no interactive feedback provided on how well a given task is accomplished or not, and most troubling, no connection provided for employees as to how their efforts affects guest satisfaction. Following the principles of the social constructs of followership, the management team at the Rocks Resort Hotel could concentrate on creating more effective levels of ownership between employee's intentions and actions and how those actions were perceived by guests (Carsten, Uhl-Bien, West, Patera, McGregor, 2010). Today there is no such feedback mechanism or process in place for either the resort employee or the management team to quantify how effective their strategies are at serving guests and delighting them with service or not. The management team is literally flying in the dark with no compass, altimeter, or method of navigating just how they are doing, which strategies are working or not, and what corrective action to take to improve. This lack of measurement is exacerbated by the cultural differences between guests, who may be from international locations. With no method in place for capturing the variation in expectations vs. experiences, the management team running the Rocks Resort Hotel is completely oblivious to how they are also being perceived by foreign guests as well.

From an International HRM standpoint, the lack of measurement with regard to service efficiency, customer satisfaction by nationality visiting the resort, and areas needing the most improvement all underscore the need for a new governance model to unify all the changes necessary to ensure the success of the Thailand venture. The PCH management team needs to consider implementing a Lean Six Sigma-based approach that is consistently applied across all customer- and service-based process areas to begin to develop a baseline of performance to improve from (Mehrjerdi, Yahia, 2011). This is the most critical area of the entire audit from an International HRM standpoint. Having this baseline of performance will provide insights into how best to improve with customer-facing process first, by how much and through specific strategies, while also ensuring the most glaring areas of weakness are dealt with first. This audit needs to deliver a Balanced Scorecard that gives the incoming management team at the Rocks Resort Hotel a very clear focus on what to address first and improve over time (Winston, Patterson, 2006). Only be doing this will the resort improve. The prioritization of which areas to first address will also be critically important in defining the expansion strategy for the Thailand location too, as the new acquisition will require a Balanced Scorecard to manage and continually refine its customer facing processes as well (Mehrjerdi, Yahia, 2011). As an additional step, the management team needs to consider using SERVQUAL (Service quality index) to further isolate the most critical factors to increasing customer satisfaction. The audit found that the customer satisfaction surveys were not used for evaluating how effective personnel performance had been; they were used for selling additional services. The link between employee effort and customer satisfaction must be measured and continually reported to management and leadership for improvement to occur. It is the recommendation of this audit for PCH to get a very thorough definition of metrics and key performance indicators (KPIs) in place for the Rock Resort Hotel first before acquiring the property in Thailand.

International Staffing

The staffing of the Rocks Resort Hotel reflects a lack of governance and consistency of HRM strategies to the broader objective of increasing occupancy by 20% in the next twelve months. The Audit shows that are no standardized processes, procedures or workflows defined for hiring the best possible candidates to fill the unique roles in each of the departments audited. The front-desk staff needs to be recruited more for the employee's ability to be cross-trained for answering telephone calls on the switchboard, assisting with concierge duties, and helping to coordinate major events at the resort for guests. The audit of hiring the front desk clear alone shows how deficient the standards are for defining how this role will contribute to customer satisfaction and lead to the 20% increase in occupancy being achieved over the long-term. Having consistent staffing requirements will also minimize turnover as the positions will be re-designed after the audit to allow for greater levels of autonomy, mastery and purpose in each role. The intent of having these attributes in each job definition and hiring criteria is that the culture is drastically in need of change. One of the best methods for accelerating the change in any culture is to concentrate on modifying job responsibilities and goals, making them measurable while at the same time based on the concept of giving employees the freedom to pursue their methods of solving complex problems (John, McGuire, Rhodes, 2008). From an international standpoint, having more effective job descriptions that underscore accountability and measurable results, and also are designed to provide each employee with as updated and recent feedback as possible about their performance is critically important.

The audit shows that the role of each job or position must be re-evaluated in the current Rocks Resort Hotel to first define internal process workflows to ensure they are more customer-driven, and second, to associate desired, measurable outcomes with each position as well. As the job descriptions are created today, there is first no definition of responsibilities from a cross-functional or interdepartmental standpoint, and no mention of metrics or KPIs which will be used to re-evaluate performance. The completing of a policy manual will not resolve this issue either; there is a much more systemic effort required to redefine which position interacts with and is integrated to which. The measures of performance from both an individual contributor and cross-functional performance standpoint must also be addressed so that each employee understands their role clearly. As the audit clearly shows, job descriptions lack the clarity of just how one relates to another, and how success is measured from one position to another as well. From an internal staffing standpoint will must be defined first so expectations with employees and managers at Rocks Resort Hotel share a common set of expectations about performance. This must be done before the Thailand acquisition, as the framework of job descriptions needs to be validated through actual performance in the Rocks Resort Hotel first.

Another factor from an international staffing standpoint that the audit uncovered was the need for ensuring cultural consistency across each of the job description and structure of the hotel organization itself. Today the structure is Australian, yet for Thailand, the cultural requirements will vary considerably. What PCH management must do is concentrate on defining how these job descriptions interconnect with one another to form a unified organization, how they plan on measuring performance as well, and then revamping them to be Thailand-specific. An excellent framework for accomplishing this is the Hofstede Cultural Dimensions Model. The five dimensions that comprise this model can be found on Dr. Geert Hofstede's site at http://www.geert-hofstede.com / . As there are significant cultural differences between Australia and Thailand, using the Cultural Dimensions Model to take into account differences on the five dimensions and plan accordingly will ensure a high probability of success with professional staffing in Thailand. The Hofstede Cultural Dimensions Model was originally developed when Dr. Hofstede worked at IBM, where executives wanted to gain insights into how best to manage culture shock amongst their teams moving from one country to another.

International Training and Development

Just as glaring as the lack of consistent job descriptions integrated across the resort is the complete lack of training and development. The audit shows that this is so severe that the potential exists for the resort to potentially be held liable for harassment or discriminatory hiring practices in its food and beverage operations. The hiring managers in food and beverage need training on how to hire for the skills necessary to run their operation, not resorting to discriminating on age, gender, or looks. A thorough sexual harassment training and development program is needed first at the Rocks Resort Hotel and second, structured to scale to international acquisitions including the Thailand property. Of the many areas of international training and development, the legal implications of making hiring decisions based on factors that could be easily seen as discriminatory needs to be addressed immediately. This is a legal and brand reputation liability to the resort and PCH that must be addressed.

Second, there is no training for any of the front office staff on how to support multiple roles at the same time, including checking guests in, assisting with questions on excursions and also managing the switchboard if the hotel is short-handed. This cross-training aspect of hotel operations today is non-existent which is why there is a lack of mastery and purpose in the jobs at the resort today. By working to create training programs that infuse autonomy, mastery and purpose into the organizations' culture the senior management of PCH can accelerate a more customer-driven mindset and a higher probability of retaining employees (John, McGuire, Rhodes, 2008). Training programs are often about the unique skills sets, knowledge and expertise to complete a job, yet they can also be about creating a unique customer-driven culture, which is what the Rocks Resort Hotel needs badly now.

The lack of international training and development is most acute in the context of preparing managers for the complexities and many challenges of running a resort. This is a key lesson learned from the audit, and underscores the need for an international training program aimed at finding managers with high levels of potential to become transformational leaders. Transformational leadership is going to be a crucial skill set for the Rocks Resort Hotel and the planned acquisition in Thailand. Transformational leadership is a powerful catalyst for galvanizing all aspects of a HRM framework so each contributes to the strategic plans and objectives of a business (Niti, Venkat, 2008). Transformational leadership is also crucial for employees to learn how to trust and believe in their leaders (Hurley, 2006). This is particularly relevant in the Rocks Hotel Resort, where turnover statistics captured during the audit point to confusion over what the direction of customer service strategies are, what roles are given to which members of the team, and how best to manage multiple priorities. The need for creating a consistent level of trust in leadership across multiple levels and departments of an organization is critical if the strategic plans and objectives are going to be attained (Cshawn, Dana, Sims, Eduardo, 2007). PCH needs to focus on these unmet needs of managers for additional training, and select those that have the highest potential to be transformational leaders, taking on more intricate and challenging leadership tasks over time.