Imperial Hotel in London Case Study Paper Example

Introduction

The Imperial Hotel is among the many leisure and business hotels based in the United Kingdom. The business is located at the heart of London town. The hotel is owned and managed by Star Hotels. Star Hotels is an international brand which operates 25 hotels under a chain in the United Kingdom. Star Hotels organization is internationally recognized for high standards of service. Therefore the Imperial Hotel as part of the chain of hotels managed under brand name Star Hotels offers high quality services to both international and local hoteliers. The Imperial Hotel has a five hundred bedrooms capacity which is complemented by en-suite facilities. Also, the hotel has a thousand people conference facilities, twelve conference rooms, three bars, and four restaurants and a leisure center with a swimming pool. The hotel has a staff which comprises of six heads of departments, four hundred and fifty full-time and part-time staff as well as outsourced contractors who offer specialist services such as security, cleaning, laundry services as well as management of the leisure center. This combination of resources makes up the organization's general business nature. The hotel enjoys a high number of guest both international tourists and business personnel who are attracted by the high quality of services provided.

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Business management is a critical success factor in all organizations across various sectors. The kind of leadership styles and kind of management determines an organizations productivity and success (Martocchio, 2008). The failure of organizations to implement efficient business management strategies could result in losses and ultimate failure of the organization. Different organizations are faced with a variety of challenges among them, uncertainty about the future, financial management, monitoring performance, regulations, and compliance, recruiting the right talent and competencies, technological changes, knowing when to embrace change, employee turnover ratios, etc. This essay will discuss the case of Imperial Hotel business management challenges. In particular, the discussion will focus on the high staff turnover at the hotel.

Analysis of the Individual Problem

Imperial Hotel currently has a very high staff turnover ratio of around 80%. This is mainly as a result of the low staff morale. Secondly, the hotel has over the past few years recorded a low customer/guest satisfaction. Guests at the hotel have rated the hotel 60% rate on the organization's grading system. This guest satisfaction rates are lowest in the entire Star chain hotels in the UK. This can be seen from the data analysis of the various satisfaction ratings as indicated in the appendices. Also, the organization has a recorded a low actual average room rate. The rate is lower compared to that charged by the local competition. There is a negative culture among the organization's staff which has resulted in increased levels of staff sick leave and poor personal attendance. Another organizational management challenge is that of inefficient use of IT systems and poor team working among the staff in the organization. The staff also has a challenge of poor operating and control procedures whereby the organization's staff members do not meet the basic standard operating procedures. Also, the hotel is experiencing a refurbishment program whereby it expected to redecorate the hotel rooms. The Hotel was lastly refurbished eight years ago and thus required redecoration to meet the current hotel standards. The refurbishment is meant to take close to two years and thus to avoid business closer, the organization has introduced a program whereby sixty rooms will be closed at each given time for refurbishment. The costs will be incurred by the hotel, and this presents a budgetary challenge due to the increased building costs while at the same time decreased income due to the sixty closed rooms at any one time. Lastly, the organization is experiencing poor performance levels which are in turn influencing the costs of the hotel and the overall profitability levels in the organization directly.

The organization has recently hired a new manager by the name Peter Farnsworth to replace the retired manager. Peter has worked in several of the other Hotels under Star city hotels based outside London. Therefore he has the expert knowledge required in the management of a hotel. The manager is expected to solve the various management challenges which the Imperial Hotel has been experiencing. This essay discusses high employee turnover and provides recommendations which Peter can implement to solve this management challenge.

High Employee Turnover

As mentioned in the previous section, Imperial Hotel management has been facing a variety of organizational management challenges. The new management headed by Peter is tasked with coming up with business management strategies to solve the high employee turnover experienced by the hotel. Imperial Hotel according to the case study hires individuals for a short period. This has resulted in a high number of employees who are employed and released in a short period. This high turnover at the hotel has resulted in increased costs. The organization uses close to 35% of its total revenue on labor costs. The human resource department incurs higher costs each time the hotel is hiring new staff. This is through hiring processes such as organizing interviews, training of the new staff, as well as employee layoff packages. These costs are recurrent every time that the organization is hiring new staff. The hotel relies heavily on staff for maximum performance, i.e., high standard services to its guests.

On the other hand, the recruitment of new staff members has impacted on the quality of the service delivered to the guests at the hotel. This, in turn, reduces guest's satisfaction and thus explains why the hotel has been ranked lowest in terms of service delivery in the Star Chain of hotels. This has impacted negatively on the number of guests that the Imperial Hotel has been receiving throughout the year.

Employees who quit the hotel have been reported to join competitor hotels in the market. This is mainly because the employees are offered better deals and are motivated more than Imperial Hotel offers. This has resulted in diminished competitiveness of the hotel. The Hotel incurs costs to train the employees but ends up losing the skilled labor to competitor hotels.

In general, the high turnover at the Imperial Hotel is increased by lack of employee commitment to their jobs and low morale levels. Therefore, to avoid severe additional costs and business challenges the organization should address the high employee turnover challenge.

According to Holbeche (2012), it is important for a business to employ the most qualified and competent workforce. This ensures that an organization business visibility is achieved. It today's business world it is essential for organizations human resource department conduct intensive recruitment of its workforce by merit. Barrows (2012) states that hiring and retaining individuals is considered a necessary part of any business management. Sharpley & Foster (2013), an organization's productivity levels and performance among employees are influenced by the turnover rates.

A high turnover rate increases costs in any organization. Costs associated with the hiring of new staff, training to equip the employees with the necessary skills increases the overall costs incurred by an organization. McDowell, Batnitzky & Dyer (2014) states that employee recruitment process is expensive and thus causes adverse effects on an organization's profitability. New employees are likely to demand higher terms of payment compared to former personnel a factor that increases the overall organizational costs. The organization will tend to incur less cost if they have higher employee retention as opposed to higher employee turnover. Business management advice organization to invest more time and resources on solving the challenge of high turnover compared to marketing and business diversification. This is so because employee turnover impacts directly on the performance of the workers.

Solutions to High Employee Turnover

Human resource professional in management theory has suggested various tools to measure the performance of an organization's workforce (Nickson, 2013). In the case of the Imperial Hotel, the organization's management and human resource department should implement a holistic approach to determine the causes of high turnover. To solve the high employee turnover ratio, it is recommended that the organization implements the following strategies;

One, Imperial Hotel should ensure that it implements a correct recruitment strategy while hiring employees. According to Boxall & Purcell (2011), organizations in the service industry especially the hotel and restaurant industry should ensure that they hire the most suitable employees. This can be achieved by implementing the correct recruitment strategy. To achieve this organization needs to have robust recruitment where only the most qualified are employed. The human resource department then should provide the employees with long-term career development. This will ensure that employees are provided with a chance to improve their skills and thus are more likely to be motivated to work in the organization. The employees need to be offered long terms of employment which reduces their worry of losing their jobs.

Secondly, the Imperial Hotel should improve its employee training and development programs. Imperial Hotel management should ensure that it offers career development programs whereby the employees are impacted with the right skills and knowledge in the hospitality industry. Career development programs may include the organization paying tuition fees for some of the employees to acquire higher knowledge and skills from professional training institutions. This group of highly trained will then be required to train their colleagues which in turn results in increased work harmony. Career improvement programs will also ensure that the employees are capable of working according to the organization's goals (Boxall & Purcell, 2011). Employee career development will ensure that Imperial retains its employees as their levels of motivation are increased and thus reducing employee turnover.

Also, the Imperial Hotel management should implement equity theory in human resource management. According to Nickson (2013), equity theory improves employee morale as well as productivity in any given organization. Imperial Hotel, therefore, should ensure that all its employees are treated equally. This means that there should be no favoritism by the management, fair remuneration for those performing similar tasks, as well as fair duty allocations. This will improve the motivation of the employees which in turn is increasing their productivity. Employees are more likely to feel motivated when their output equals the inputs they put towards a task in the organization. Satisfactory remuneration doesn't mean high wages but means that employees should feel that what their inputs are equally rewarded. According to the theory of equity, workers become more encouraged to make positive contributions if they are treated fairly and equal (Sims, 2002). To create some form of competition, the Imperial Hotel management should create rewards for best performers. This encourages a healthy competition which in turn ensures that the motivation levels are increased.

Lastly, the Imperial Hotel management should ensure that it takes into consideration the needs of the employees. This means that the employee work environment should be such that it meets the set standards. A conducive work environment is likely to increase an e...