Essay Example on COVID-19 Impacts: Hospitality Industry Hit Hardest by Pandemic

Introduction

Most of the businesses have been forced to close down or change their mode of operation due to the ongoing coronavirus pandemic that has affected almost every sector of the market that contributes to the national economic growth. One of the most affected industries is the hospitality industry since most of their prospective customers are from the other sectors of the business who frequently utilizes the conference and accommodation facilities in a hotel. Moreover, most of the companies have minimized conferences since; according to the world health organization (WHO) and the center for disease control and prevention statements is that one of the easiest ways the virus spread is through personal contact or crowding. Because the companies are no longer holding business meetings and workshops, the hotel industries are left with no option other than to close down and wait for the way forward. Hilton hotel is one of the affected hospitality companies that have been hit by the crisis, and they have developed strategies on how to deal with the pandemic. This paper will outline the approach adopted by the human resource department to deal with the current coronavirus crisis that is affecting the world.

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The Event (Covid-19 Outbreak)

The covid-19 epidemic has negatively hit Hilton than it was expected since most of their clients are from china where the disease originated. Due to the pandemic, human resource department is tasked with heavy duties and obligations to deal with the situation no matter the circumstances to avoid the hotel from shutting down (Denise & Griffin, 2018). The hotel is aware that the coronavirus outbreak may have some long-lasting adverse impacts on the general hotel industry sector, which already has manifested in so many aspects like slowing of the world economy concerning other geopolitical problems. After the announcement of the covid-19 issues, human resource management has been working hard to come up with techniques on how to handle this calamity in a more professional way that does not affect the stakeholders and the company's revenue.

Closing of 150 Hotels in China

China was one of the most and leading customers of the Hilton hotels since they have around 150 hotels in the country. The human resource department, in consultation with the CEO, had to shut down its operations in China to protect its clients and the employees from being affected by the covid-19 pandemic (Wang, Hutchins & Garavan, 2009). Nassetta, the CEO of the Hilton, announced in meeting at the Hilton Mclean that the hospitality industry was going to deal with impacts of the coronavirus outbreak for about 12 months and the only way to cut and lower the operation cost was to close the hotels which are based in China as they weigh the situation to embark on next move. The closing up of the china hotels portrays the role of human resources, which is the concern of the guests, and the stakeholders' welfare. The stakeholders include junior employees and top management employees. The first responsibility of the human resource department is to make sure that the working environment for the employees is conducive and does not interfere with their health or performance levels.

The human resource was able to conduct a lot of research, including the past crisis that affected the company, such as the SARS outbreak in the year 2003, and came up with the budget projections for the year ahead (Tyson, 2014). The industry had an experience with the SARS outbreak, and they learned some valuable lessons since the effects they are anticipating are more of the same to the covid-19 scenarios. Also, another factor considers in the close of the china hotels is the rate at which the death rates were occurring in the region, which means it was spreading fast and could end up affecting the whole company. Some of the transportation industries have shut down like airlines such as British Airways and American Airways, and they are among the top clients of the Hilton hotel, and that is why China provides around 2.7 percent of the Hiltons overall EBITDA.

Hilton Withdraws from the 2020 Outlook

Another best solution or decision made by the human resource was to suggest the option of withdrawing from the 2020 outlook. The rise of many cases of the covid-19 has resulted in the big withdrawal of the Hilton hotel from the 2020 outlook until things get back to normal to continue with their projects. It is the responsibility of any human resource department to maintain a good reputation and relationship with the stakeholders and the government. Hilton has the mandate of responding to any kind of market conditions to continue serving its customers and contribute a lot to the growth of the economy and also the personal developments of the employees. The guest's and employees' safety is the first priority, and that is why there has been the withdrawal of services such as redeeming the earned points or token awarded to the repetitive guest who visits the hotel to prevent them from being affected by the pandemic. Also, one of the reasons behind Hilton withdrawing from the outlook is to protect their financial state and to honor one of their missions, which are to offer guest safety at whatever cost.

Drawing $1.75 Billion Credit Line

The impact of coronavirus needs any company to be financially stable to prevent from crumbling down. One of the essential duties of a human resource department is to make sure that by the end of the day; the business is financially stable and knows how to survive in case of a disaster or any emergency that might affect the general operations of the company. Drawing a loan of $1.75 million is the best strategy to use so that it can deal with the projected impacts of coronavirus to the hotel, and this means that the loan comes at low interest since it acts as a risk management loan (. Closing down of companies means that there is no generation of revenue, and instead, the company will incur losses to deal with the crisis. Since the virus is a significant drag on taxes and more so to the business in Asia and that is why getting a loan from its affiliates Goldman Sachs Group Inc and Deutsche Bank AG plays a significant role in the mitigation of the expected impacts. Some of the expected liquidity shortfalls that the loan is expected to handle includes the staffs' salaries and other allowances that they did not plan for in their regular annual budget.

Sending of the Employees on Unpaid and Paid Leaves

Due to the coronavirus pandemic hotels have decided to send off their employees at home on leave and unpaid leave basis to avoid the spread of the corvid-19 among them. It is upon the responsibility of human resource management to have at heart the interests and the rights of the people, and this include being concerned about their survival at home (Loosemore, Raftery & Reilly, 2006). Sending the workers at home until further notice is one of the strategies to employ to help curb the effects of covid-19, and this means that when the situation is reasonable, they would not have lost one of their stakeholders through death. Keeping distance and staying at home is the safest and recommended measures by CDC and WHO that most hotels have adopted to help stop the spread of the covid-19 and this shows that the human resources have exercised the responsibility of sticking to the country's rules and regulations.

Conclusion

In conclusion, the human resource department is the most trusted department concerning the whole operations of the company. Every human resource manager has to possess some qualities to be able to exercise those leadership skills because the company entrusts them with their secrets, such as the financial levels of the company. As seen from the above example of the Hilton hotel crisis, it is apparent that communication skills are one of the best strategies to adopt in case of an emergency or a disaster that befalls a company. After that, it is when there are procedures that are recommended to be undertaken by the company to avoid further damages and, in some cases its closure. Therefore, proper human resource management can save a company from economic and political fall down in case of an emergency.

References

Denise, A. & Griffin, R. (2018).HR, Human Resourcess.5th edition. engage learning.

Hays, S. W., & Kearney, R. C. (2001). Anticipated changes in human resource management: Views from the field. Public Administration Review, 61(5), 585-597.

Loosemore, M., Raftery, J., & Reilly, C. (2006). Risk management in projects. Taylor & Francis.

Tyson, S. (2014). Essentials of human resource management. Routledge.

Wang, J., Hutchins, H. M., & Garavan, T. N. (2009). Exploring the strategic role of human resource development in organizational crisis management. Human Resource Development Review, 8(1), 22-53.