Challenges faced by HR in the Hospitality Industry:

1. Globalization:

The process of globalization has brought a number of challenges for HR department and
managers in the hospitality industry. The immediate effect of globalization process is rapid
expansion of global markets, and HR managers have to struggle to balance their role to make
their organization able to think globally and act locally. In this regard, they have to support
managers working in different departments to acquire and manage people, ideas and information
in organizations across different countries of the globe to meet local demands of the people.
Similarly, in the process of globalization, our HR managers are now facing issues like diversity,
complexity and ambiguity while managing people in organizations. A workplace from different
countries with different values and cultures, education and training backgrounds are representing
different races and religions are participating in workplace. This trend supports to increase
diversity at our workplace and at the same time increases challenges for managing diversified
group of workers.

2. Managing Knowledge Workers:

The globalization of work and continuing advances in technology are changing the nature of the
workforce. Information specialists called knowledge workers are equipped to maintain and
expand the technological leadership role in the next century are replacing the manual labor also
known as the blue-collar workers. Knowledge workers are known for their special
characteristics. They are people who can analyze, synthesize and evaluate information to solve
various problems. Knowledge workers basically use their intellect to transform ideas, products
services and processes. Their main value to an organization is their ability to gather and analyze
information and make decisions that will benefit the company. Managing these set of employees
plays a very important role in the growth of the organization. Because of their own hand
experience they fail to obey the management principles. A knowledge worker’s personality is
typically an achievement oriented one. These people focus on achieving their individual goals
and not in the growth of the organization. For example when a new employee joins to an
organization and he has less experience he doesn’t follow the management principles. These
types of workers are called knowledge workers.

(Jyothi, 2010), (Bohlander G. a., 2009)

3. Managing Technological Changes:

Technology has had a positive effect on internal operations for an organization but also has
changed the way human resource managers’ work. Some managers in the hospitality industry
view the application of technology to operational issues as a problem. It is true because the
technological systems used in the bar, front office, restaurants etc. are far more advanced and
complicated today than those available only a short time ago, and these systems continue to
advance rapidly. They take a lot of time to adjust to these new technologies. Preparing workforce
to approve new technologies is very tough. Getting the approval of IT and other technologies by
all levels in a company is a huge challenge face by hospitality organizations. For example when
the systems are updated and new technology has been introduced the worker finds it difficult to
adapt to it. He does not show a positive attitude towards it.

Managing Change:

The business environment is highly unpredictable and introduction of change is essential for any
organization in order to make progress. Globalization and Technology are the two major factors
that have driven change in organizations today. Globalization has opened new doors for business
opportunities. However it has also lead to many interventions such as reformation, turnaround,
merges, downsizing, etc. In order to achieve success, the organizations have to manage these
changes that have occurred along with the staff issues that arise. Thus managing change is vital
in order for the organization to function smoothly.

For example when a new software is installed which is used to do company counts are installed
the knowledge workers refuse to work on it. (Bohlander G. a., 2009)

(Bohlander G. a., 2009), (Hayes, 2009)

4. Competence of HR Managers:

The human capital in an organization plays a very important role in the successes of the
organization. Human capital is an asset to the organization in recruiting the best people,
managing them efficiently, inspiring them and retaining them. People who have strong data
about the business and who understands the human resource management principles should be
developed which is necessary for the organization. One of the most important roles is
competence of human resource managers. Choosing the right people for the right job is the
greatest challenge for a human resource manager. For example when recruiting new employees
it’s important that the right person is adopted. (Bohlander G. a., 2009), (Nikolis, 2009)

5. Developing Leadership:

Business environment is changing at a faster rate than ever before. In this environment,
organizations need to be self driven by effective leaders. They have to be dedicated, devoted, self
driven inspire an image among the followers, be able to inspire and motivate junior colleagues to
get the work done. They must be able to set strategic direction and keep the organization moving
towards excellence. Organizations need leaders to understand the business scenario, plan actions
and implement then to derive business goals. Everyone has some leadership potential that can be
released for the benefit of society or business in an organization. For example when there is no
unity amongst workers a leader is required to guide them. (Haldar, 2009)

6. Turnover

Turnover is a problem in the hospitality sector. This has however been the greatest of all
concerns. Turnovers if done frequently become a problem. This happens because people in the
industry want to get better than what they are doing currently. Say, a person does the job of an
attendant in a restaurant not because he wants to or dream of doing it. He does that in order to get
something better later i.e. while getting ready for something else. This whole psychology aids in
worsening the conditions of the hotel or restaurant, as the workers working there are doing the
job for the sake of doing it. This lowers the standard of the hotel and mismanagement is
recorded. Turnovers happen in two ways –

• By the means of quitting the job (when employees leave a job)

• By the means of firing (when employers fire employees from the job)

Both the situations cost the hotel or the restaurant unnecessary expenditure on the recruitment
and training of new employees

Retention of Employees:

Many a times, employees work in hotels on short-term basis as it is not their ending professional
goal to work in the hospitality sector. Hence after a certain time, these employees leave their
jobs. On the other hand, certain employees have to be let go due to their low-grade job
performance or other job related issues. Thus retention of employees is a major problem faced
by HR in hotels.

When an employee gets into a hotel to work because he didn't get any other job his main goals
are based on his private life and will not like to stay in the hotel industry for a long time. (Karan,
Challenges faced by HR in the hotel industry, 2009)

7. Recruitment

With relatively high turnover rates, it should come as no surprise that recruiting is another
problem facing HR in the hospitality industry. Even finding candidates with the skills to
succeed in entry-level positions has become an issue. Part of the problem is pre-employment
assessments, explains Joyce Gioia, CEO of Employer of Choice. When an establishment fails
to fully assess candidates, it increases the chances of placing the right person in the wrong role.

8. Training

Also going hand in hand with high turnover are training problems, notes Hotel News Now, an
online news resource for the hospitality industry. When the rate of retention is low,
management tends to put new recruits on the floor before teaching them how to do the job
properly. The establishment may be fully staffed, but the service is now questionable. Plus, the
high turnover can increase the chances of employees moving into managerial positions before
they’re ready. Well-trained managers can best develop first-line employees, notes Gioia.

9. Morale

While executives in the hospitality industry emphasize retention and recruitment, those in HR
also note morale as a concern. Low morale has a large impact on service standards, which can
tarnish the reputation of a hotel, bar or a restaurant and eventually erode business. The causes
of low morale can vary by business, but some of the top offenders were lack of training,
unskilled colleagues, understaffing, stress and few rewards.

Morale plays an important role in the success of any company or restaurant. Therefore, keeping
your workforce happy and enthusiastic all the time is a real task. As might be expected, an
employer and an employee share a relationship of obligations. Therefore, it becomes the duty of
the employer to keep his employee always engaged and happy. Remunerating them on time,
giving them positive feedbacks, holding activities that require employee’ engagement to name a
few are things HR department of the restaurant requires to do. Often employers neglect their
employees without even realizing it. But the situation worsens with time and employees start
either quitting the job or do not do the work efficiently. If a hotel needs success it shouldn’t
neglect its workforce rather it should involve each and every worker of it's, no matter how small
or big, in every task and celebration. Holding meetings once or twice a week can also be a great
idea to keep the moral high of the people working for you.

10. Increased harassment cases

Harassment is a global issue. Like every industry, hospitality too faces this problem. It is
disgraceful and embarrassing that harassment is so enrooted in our culture that it causes
hindrances in every sphere of life. Back then, people didn’t have awareness and thus kept mum
about them getting harassed sometimes, at the hands of the guests and sometimes at the hands of
those having a superior position. Nowadays, things are getting a bit better and the victims are
coming forward to raise their voice. Hundreds of harassment reports are registered every year by
the HR department. This not only creates a fearsome situation amongst women but also lowers
the reputation of the hotel. The act of one or two causes problem to many. Therefore, strict rules
should be framed and implemented in the organization. However, not every harassment claim is
real. Many employees when fired from their job sue the hotel or their employers for indecent
behavior or sexual harassment. Many cases in the past have been recorded where the person
claiming to be a victim of sexual harassment has been proven wrong. All these things degrade
the level of the hotel and the guests refrain from choosing the hotel. When such a situation arises,
the HR team has to shift their complete focus from delivering the best services to the guest to
investigating the allegations levied by their staff which consequently adds salt to the injury.

11. Inequity amongst the employees

The issue of discrimination is a common bone of contention in all the industries. Unequal
remuneration, opportunity to perform or favoritism is some of the reasons that cause disharmony
in the organization. Unfavorable behavior with an employee due to their gender, religion, caste
or creed is not only morally and ethically wrong but also harms the company in too. When
employees register the complaints regarding inequality and the management does not take clear
and sound actions upon it, they lose the trust of their own employees which in turn harms the
name and reputation of the hotel. The focus or HR department shifts once again and it costs the
hotel a lot. Least a hotel management can do is to take quick actions against the offenders. Hotel
management should work hard to avoid such situations from arising by formulating strict laws
regarding indiscrimination at the workplace.

12. Shrinkage is detrimental

Shrinkage has become a grave issue for the restaurants and bars these days. Often it is seen that
the hotel or the bar management commits several small yet significant mistakes while filling
their pantries and bars. Lack of popular brands in your bar can prove to be detrimental for your
business. Therefore, the bar management should keep the bar up-to-dated and brimful amount of
edibles and drinks. To beat the problem of shrinkage hotel management requires to formulate
and design effective strategies and strong implementation of the same. There are certain reasons
that increase the chances of shrinkage in a bar such as over pouring, unnecessarily providing
large numbers of free drinks, rejected drinks by the customers for several reasons to name a few.
These reasons are enough to increase the chances of shrinkage and reducing the profits of the
bar.

Shrinkage, or the loss of goods, has become an issue for many bars, restaurants, nightclubs and
hotels, and it takes many forms. Unreported wastage, theft and misuse, such as providing free
drinks to friends, often top the list of causes of shrinkage. Loss is also attributed to both
transaction and inventory discrepancies.

13. Theft in hotels

It goes without saying that poor security and safety policies in the hotels can degrade the
percentage of profit of the hotel. An unsafe hotel room where their luggage and valuables are not
secured is a huge turn off for guests. Whether the theft is done by somebody from the staff or by
somebody out of the hotel management, it becomes the duty of the management to protect their
guests and their belongings. A strong security policy can avoid these thefts from happening and
save a lot of time and money from getting wasted, which can be sued to modify and increase the
profit ratio of the hotel.

14. Inexperienced or unskillful managers

A poorly managed hotel becomes a hub for various problems. An inexperienced or incapable
manager can be held partially responsible for poor management of the hotel if not completely.
Therefore, recruitment of capable managers, having a clear and firm vision, great sets of skills
required to manage the workforce and other resources of the hotel hold great value. A manager
who has experience and the quality of keeping its employees busy and enthusiastic both at the
same time is a real asset for the hotel. The process of recruitment of managers should be based
on a realistic approach. Instead of asking them bookish questions, putting them into real-life
situations can be a great parameter of judging the person’s capabilities. New and revolutionary
ideas and approaches should be implemented in the hospitality industry.
Challenges in recruitment:

The major challenges which are faced by the HR department in recruitment are:

Adaptability to globalization – The HR professionals are anticipated and required to keep

accustomed with the changing times, i.e. the changing taking place across the globe. HR should
maintain the appropriateness of the process. For example when a different kind of format is
followed around the globe the organization should also adapt to the same. Many organizations
in India fail to do this.

Lack of motivation – Recruitment is considered to be an unacknowledged job. Even if the

organization is achieving results, the HR department are not thanked for recruiting the right
employees and performers.

When an interview or a recruitment process is successfully completed by the HR department

there is no one to congratulate them or motivate them. Proper motivation is required to ensure
proper work in future.

Process Analysis – The closeness and the speed of the recruitment are the main concerns for the
HR department in recruitment. The process should be flexible, adaptive and responsive to the
instant requirements. The recruiting should also be cost effective.

If recruitment is to be taken place then a proper process should be set by the organization and
what has to be followed, such as written tests, personal interviews and group discussions.

Strategic Prioritization – The up – coming new systems are both an opportunity as well as a
challenge for the HR professionals. Therefore, reviewing staffing needs and prioritizing the
responsibilities to meet the changes in the market has become a challenge for the recruitment
professionals.

(Anonymous, 2011)

Workplace diversity

The future accomplishments of any organizations rely on the ability to manage a diverse body of
talent that can bring original ideas, perspectives and views to their work. The challenge and
problems faced of workplace diversity can be turned into a tactical organizational asset if an
organization is able to take advantage of on this melting pot of various talents. With the mixture
of talents of different cultural backgrounds, genders, ages and lifestyles, an organization can
respond to business opportunities more swiftly and resourcefully, especially in the global arena
which must be one of the essential organizational goals to be attained. More importantly, if the
organizational situation does not support diversity broadly, one risks losing talent to their
competitors.

One of the main reasons for ineffective workplace diversity management is the predisposition to
class employees, placing them in a different silo based on their diversity profile. In the real
world, diversity cannot be simply categorized and those organizations that act in response to
human complication by leveraging the talents of a broad workforce will be the most successful
in growing their businesses and their consumer base.

(Anonymous, Human Resources/challenges of cultural diversity in HRM, 2011)

Shortage of Skilled Employees:

One of the most essential requirements of the hotel industry is to have skilled labour force which
can help in achieving the various goals and objectives set by the organization. For the
functioning of any hotel, quality workforce having various skills is required. Shortage of skilled
workforce affects the industry, and it is not surprising that one of the greatest challenges faced
by the HR in the hospitality industry is the unavailability of skilled workforce in the different
skill levels. Also retaining this workforce is necessary.

When a hotel starts nearby offering higher salary the quality workforce shifts towards that hotel.
The HR has to retain these employees. (Karan, Challenges faced by HR in the hotel industry,
2009)

Lack of Quality Service:

Due to the shortage of employees in the industry and the overflowing of customers the quality of
the service I affected. When the work load increases the performance of the employees goes
down. Due to too much work pressure, the job performance of the employee falls and in turn it
affects the quality of service. Thus the HR department has to take the blame for the damage
caused to the hotel brand name. When a hotel is overbooked and there is lot of guests in the
hotel the quality of service reduces which affects the hotel’s brand name. (Karan, Challenges
faced by HR in the hotel industry, 2009)