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A PROJECT REPORT
ON
ANALYSIS OF THE STAFFING PROCESS IN THE HOTEL INDUSTRY
SUBMITTED TO
SYMBIOSIS INSTITUTE OF BUSINESS MANAGEMENT
BY
Nitya N, Sharmita Bose, Monalisa and Punit Sharma
IN PARTIAL FULFILLMENT OF
EXECUTIVE MBA (HRM)
JUNE, 2015-2017
# 95/1.95/2, Electronic City, Phase 1,
Hosur Road, Bangalore- 560100
1
Chapter No Title Page No
Declaration 3
Acknowledgement 4
1 Introduction
1.1 Background of the study 5
1.2 Background of the topic 7
1.3 Company Profile 8
1.4 Research Topic 10
1.5 Need of the study 10
1.6 Scope of the study 10
1.7 Objectives of the study 10
2 Research Methodology
2.1 Research Design 12
2.2 Primary Data 12
2.3 Secondary Data 12
2.4 Sample Design 12
2.4.1 Sample Size 12
2.4.2 Sampling Method 12
2.5 Methods of Data Collection 13
2.5.1 Instrument of Data Collection 11
2.5.2 Drafting of Questionnaire 11
2.6 Field Work 13
2.7 Data Analysis Techniques 14
2.8 Limitations 14
3 Data Processing and Analysis 14
4 Findings 25
5 Conclusion 26
6 Recommendations 27
7 Bibliography 29
2
CONTENTS
Declaration
We hereby declare that project Titled “The Staffing Process in the Hotel Industry” is an original
piece of research work carried out by us under the guidance and supervision of Mr. G. Mohan
Prasad(Proprietor of Hotel Akshaya) and Prof. Dinesh. The information has been collected from
genuine & authentic sources. The work has been submitted in partial fulfillment of the
requirement of MBA to our college, SIBM, Bangalore.
Place: Bangalore Signature:
……………………..
Date: Nitya N
Sharmita Bose
Monalisa
Punit Sharma
MBA-2015-2017
3
Acknowledgement
The success and final outcome of this project required a lot of guidance and assistance from
many people and we are extremely fortunate to have got this all along the completion of our
project work. Whatever we have done is only due to such guidance and assistance and we would
not forget to thank them.
We respect and thank Mr. G.MOHAN PRASAD, for giving us an opportunity to do the project
work in Hotel Akshaya and providing us all support and guidance which made us complete the
project on time. W are extremely grateful to him for providing such a nice support and guidance
though he had busy schedule managing the company affairs.
We owe our profound gratitude to our internal project guide and lecturer, Prof. Dinesh, who took
keen interest on our project work and guided us all along with valuable suggestions, till the
completion of our project work by providing all the necessary information for developing a good
system.
We are thankful to and fortunate enough to get constant encouragement, support and guidance
from our Prof. Dinesh, lecturer of Talent Acquisition which helped us in successfully completing
our project work.
4
1. INTRODUCTION
1.1 Background of the study:
The hospitality industry is considered to be the world’s fastest growing industry contributing for
only 2% of the GDP in 2003-04. However, it is projected to grow at a rate of 8.8% by 2016,
which would place India as the second-fastest growing tourism market in the world. This
increasing importance was the result of vigorous process of expansion undertaken in the last
decades. As a consequence, hospitality organizations expanding to a global market have started
to face the challenge of selecting and managing an increasingly multicultural workforce.
The fact that people from dissimilar cultural backgrounds , values, beliefs, behaviors and
expectations were joining the industry demands a new approach to the selection process .Hence
the use of effective and culturally sensitive selection methods are more important than ever .It
becomes one of the key factor of success for hospitality organizations in their process of
nationalization or internationalization and an important issue for academics or practitioners at the
beginning of the millennium.
On one side, it’s a necessity of shifting towards a more sophisticated Human Resource
Management Approach that takes into account the selection of staff from diverse cultural
backgrounds. Thus, the most important challenge for the hotel industry was none other than the
Selection process followed by recruitment and retention.
Historically, the hospitality industry has drawn heavily from the dissimilar background labor
pool to meet their workforce needs, but the industry has been left with an insufficient pipeline of
new workers to satisfy demand. Faced with a shrinking pipeline of workers, the hospitality
industry is increasing its recruitment efforts towards youth and developing targeted strategies for
previously untapped labor pools. Employers had difficulty finding workers who possess basic
5
"soft skills," which are often a prerequisite for success in a customer service-oriented field.
English proficiency was a key challenge because a large percentage of the hospitality workforce
did not speak English in order to deal with various types of customers. Employers never used to
provide language training programs which could allow workers to effectively perform their job,
and include providing quality customer service and understanding safety requirements.
The hospitality industry as a whole lacked consistency and portability in training models and
skill certifications.
High turnover was a key challenge in the hospitality industry. The restaurant, hotel and lodging
sectors had difficulty retaining skilled workers because of the negative image that the industry
faces. Many hotels used to treat employee recruitment at the same level as their corporate
branding efforts, realizing that the two go hand in hand. But, the traditional recruitment effort has
completely shifted over the last several years.
In recent years, it is observed that the entire recruitment process is like a “ time bomb” for the
hotel industry. When things are slowly picking up in the hotel industry, employers are becoming
increasingly selective with whom they hire. The quality of employees, after-all, reflects the
quality of service, which in turn determines whether a hotel is going to be successful or not since
experience is a consumer's bottom line. The importance of finding good employees, especially
youth workers with adequate talent and soft skills, is a high priority for the industry .Hotel jobs
are found rarely advertised in the classified section of newspapers. Hotels are now using
colorful full-page ads, job aggregators, and industry specific job boards to attract candidates to
appealing "careers" rather than jobs. Recruitment strategies have changed significantly over the
last fourteen years. A majority of today's employees are hired from online applications and get
retained by the company through higher compensation and benefits. Employers started providing
various kinds of training programs which could allow workers to effectively perform their job,
and include providing quality customer service and understanding safety requirements. The
hospitality industry gained consistency and portability in training models and skill certifications.
Thus, we are interested on the whole staffing process in the hotel industry like how does it work
in reality after observing the inconsistency between theory and practice within the industry. In
6
other words, in recent years the approach which is adopted by the hotel recruiters during
selection processes, followed by recruiting, retaining and deploying the talent , has been
documented in this study of research.
The purpose of the report is to look at recruitment, selection and retention methods used in the
hotel industry. Thus, firstly, to discuss relevant previous findings in connection with aim of this
study. Secondly, to provide new evidence about the current practices or data analysis in relation
to the staffing methods used by the industry.
The study has been structured in three parts. The first part focuses on Research Methodology in
order to analyze key topics strongly related to the aim of this study .The second part describes
the details of an exploratory research conducted with the purpose of Data Analysis. The third
part includes both a Systematic analysis of the Research Findings and the final discussion
regarding links between theory and findings followed by Recommendations.
1.2 Background of the topic:
Topic is to analyze the staffing process of the chosen firm (Hotel Akshaya, Vishakapatnam) from
the hotel industry in order to utilize our knowledge to recommend further implementations that
could help the firm achieve a greater competitive business advantage.
1.3 Company Profile:
7
Introduction:
Hotel Akshaya nested in the heart of Visakhapatnam, Andhra Pradesh, India is easily accessible
to downtown business centers, Tourist attractions, Shopping and Dining places. It is a Business
Class hotel having 27 Executive Rooms and 3 Deluxe Rooms; rooms providing exquisite
facilities and services of executive standards. They have a tasty multi-cuisine restaurant “ Tasty
Point”, secure, round the clock communication networks, well planned banquet hall named
“Canopy” and mini-conference hall named “ Swagat”, etc. The hotel was designed with the
business and family travelers in mind. The goal at the Hotel Akshaya is to ensure that their
guests feel welcomed from the day of the arrival until their departure. Their standards and
personal level of quality service ensure that their guests enjoy a memorable stay.
8
Company Profile:
Hotel Akshaya began its journey in the year 2008 to crave for itself a niche in the Hospitality
industry.
Name of the Company AKSHAYA
Year Of Establishment 28th
February,2008
Company’s Address Opp.DRM office,Dondaparthi,Vizag-
530016,Andhra Pradesh, India
Phone +919908664422
Email mail@hotelakshaya.in
Website www.hotelakshaya.in
Proprietor Mr. G. Mohan Prasad
Nature Of ownership Private Limited Company
Nature Of Business Hospitality/Hotel Industry
1.4 Research Topic:
9
To critically analyze the Talent Acquisition or Staffing Process of Hotel Akshaya and to
recommend further implementations that could help the firm achieve a greater competitive
business advantage.
1.5 Need of the study:
The need of this study is to know the recruitment, selection and retention methods used in the
hotel industry in order to enhance our practical knowledge about the staffing process in this
industry.
1.6 Scope of the Study:
The aim of our study is to explore the extent of Staffing by looking at the best practice for
recruitment, selection and retention in the private sector of the hotel industry by analyzing the
prospects of each area and its components; looking at studies conducted which relate to the
industry and analyzing this with a snapshot of current practice within the industry as well as
perceptions of benefits and reward expected from employees to draw realistic and practical
conclusions for the way forward.
1.7 Objectives of the study:
Primary Objectives:
 To understand the process of staffing.
 To review and analyze recruitment, selection and retention methods from a theoretical
point of view in the hotel industry.
 To understand what the industry offers in terms of financial and non-financial benefits
and their relevance.
 To review of additions to basic pay offered by the industry.
10
 To know the sources of recruitment at various levels and jobs.
Secondary Objectives:
 To identify the probable area of improvement to make staffing procedures more effective.
 To analyze themes from the research which relate to industry issues and produce
recommendations for improvements and best practice.
11
2. RESEARCH METHODOLOGY:
2.1 Research Design:
The research design adopted in this study is exploratory. The objective of this is to gather
preliminary information that will help define the problem and to describe the characteristics of
various aspects like to determine the staffing, recruiting process and retention methods in the
hospitality industry.
2.2 Primary Data:
The primary data was collected by the authors by conducting structured interviews with the
sample.
2.3 Secondary Data:
The secondary data was obtained from the internet sources like the hotel website.
2.4 Sample Design:
Non probability sampling method was used here as the sample was not random and was
determined beforehand.
2.4.1 Sample Size:
The sample size is the employee strength of the hotel which is 48 including the 5 heads of the
departments- Food & Beverage, House Keeping, Front Office, Maintenance, Accounts and the
proprietor who represented all of them for our structured interviews.
2.4.2 Sampling Method:
A purposive or judgmental sampling technique was used here. Since the objective of the
interviews were to collect data on the internal processes of staffing, recruiting and retaining the
employees of the hospitality industry, only the 5 heads of department and the proprietor
comprised the sampling as the need was specific to internal procedures and decisions.
12
2.5 Method of Data collection:
The method of data collection was through telephonic structured interview. The authors
approached the proprietor(who represented the entire staff) and conducted a structured interview
regarding the various aspects of staffing, recruiting and retaining in their hotel.
2.5.1 Instrument of Data collection:
Questionnaire (through telephone) was the data collection tool used.
2.5.2 Drafting of Questionnaire:
The questions asked in the structured interview are as follows:
 Which recruitment media do job applicants look in?
 How do you generate the pool of candidates to apply for the jobs at your hotel?
 Which of these methods results in the most number of jobs offered?
 Who carries out the recruitment drives?
 While hiring, what are the questions asked?
 What are the main reasons why employees leave?
 What are the benefits and incentives provided to the employees?
 Which of these benefits are most appreciated by the employees?
 What are the non-financial aspects offered in order to retain the talent?
 What challenges do you face in retaining the talent and how do you overcome them?
 How do you manage performance of the staff?
 What are the competitive measures taken by the company to retain the talent?
13
2.6 Field Work:
Primary data was collected with the help of structured telephonic interviews that included
conference calls.
2.7 Data Analysis Techniques:
Qualitative data analysis technique has been followed by the authors as the research design is
descriptive.
2.8 Limitations:
Although the research has reached its aims, there were some unavoidable limitations. Firstly,
there was no actual field work involved in this research due to time constraint and feasibility,
telephonic interviews were our primary source of data. Direct conversation at the hotel premises
would have been apt as the authors could have got more accurate primary data through other
more reliable methods such as observations. Secondly, the sampling design was non-probability
sampling wherein the samples could be bias-based and gatekeepers to the responses. Better
response would have been obtained if it was a probability sampling.
3. Data Processing and Analysis:
With employee strength of 48 staff, 30 being the old staff, Hotel Akshaya has been successfully
thriving in the market with a quite healthy staffing process.
Recruitment:
Methods of recruitment: Formal and informal methods.
Formal methods must attract attention, create and maintain interest and stimulate action.
14
Informal methods are where employees, suppliers or personal acquaintances get to hear about
the vacancy via word of mouth. There is often a reward for the introducee when the employee
successfully completes an induction period.
The hotel has a combined method of both formal and informal methods- via newspaper
advertisements/resume database (social media does not play a major role in the supply of labour
for this hotel) and employee reference by old or new staff or by the management relationship
with the external contacts who refer candidates to the hotel.
Selection:
The selection process enables the organization to decide which people best fit its needs and
individuals to decide to what extend the organization fits their needs. Unless selectors are very
clear about what they are looking for then it is difficult for them to know when they have found
it. Selection criteria can be at three different levels: organizational, functional/departmental and
individual job criteria. The choice of the selection methods will depend on factors such as type
and level of job, abilities of the managers involved, time required, accuracy demanded and cost.
Interviews:
The style of interviews usually reflects the job specification. Most interviews assess general
abilities, experience and cultural suitability; if experience is not a prerequisite then it may be
based on personality and attitude.
They should provide the answers to three questions:
1. Can the individual do the job? Is he or she competent?
2. Will the individual do the job? Is he or she motivated?
3. How is the individual likely to fit into the organization?
Structured interviews
The individual interview is most popular but can be open to most bias or superficial decision.
Interviewing panels with two or more people to interview one candidate are frequently preferred,
usually the Human Resources Manager and the Line Manager together. Selection boards that are
15
more formal with a larger selecting panel have an advantage that more people can see the
candidate and compare notes at one time but disadvantage is that questions tend to be unplanned
and delivered at random.
Specific to Hotel Akshaya, the below questions are asked as a part of interview process:
1. What was the candidate’s last experience?
2. How does the candidate know about the hotel? (to assess the source of reference)
3. What is the candidate’s expectation from the role?
4. What is the candidate’s expected salary?
Assessment centres
These involve a range of assessment techniques. A benefit of their use is to show and indicate the
extent to which candidates match the culture of the organization observed through their
behaviour in different situations, a range of tests and structured interviews are considered.
Assessment test in Hotel Akshaya is conducted only for the Chef role during recruitment where
in the candidate is asked to prepare 2 Vegetarian and 2 Non Vegetarian dishes; based on which
final decision is taken for selection.
Retention:
It is important to distinguish between recruitment and retention. The greater part of recruitment
is to replace labour, i.e. following a failure to retain, although this does not necessarily imply that
the failure to retain reflects adversely on the firm. It could be that the employee is testing if they
actually want to do a certain job role and find that they do not or it could be the employer who
makes errors in recruitment and has to deal with the situation. Thus not all recruitment, which is
caused by non-retention of labour, is to be criticised. A good deal of non-retention is seen rightly
by business as indicative of failure of policy and its application somewhere along the line. When
complaining about recruitment difficulties business should be examining the causes of turnover
difficulties.
16
People may leave because they cannot obtain the rewards or job conditions enjoyed by others.
Concepts of fairness and equality are very relevant in retention, and depend considerably on the
benefits and conditions seen or believed to be enjoyed by others. The way in which we value
features of jobs and our degree of satisfaction is strongly influenced by what we believe others
are receiving; whether our belief is based on fact or error is not so important.
Some industries/firms decided that it is better to accept high turnover as long as there is a
continuing flow of recruits willing to enter its employ, even if only for short periods. Other
industries may find that its labour force is too stable, with the effect that the average age is high
with great bunching, and consequential problems for future flows of adequately trained and
qualified workers. If the labour force is too stable, attitudes can become fossilised and change
and adaptation made much more difficult.
As it seen that Hotel Akshaya has retained almost 30 employees out of the 48 employee strength,
it suggests that the hotel has a healthy practice of employee retention. It was noted that the
atmosphere created by the management is a key factor for employee retention. Employees are
recognized and rewarded for their performance equally which has helped the hotel motivate them
and retain them. Not only are employees are rewarded, but they are considered for the
managerial decisions through the suggestions/ feedback which they provide in the Suggestion
Box.
Exit interview:
Ideally should not be carried out by someone too senior or the employees line manager. The
interviews must find out the reason for leaving, where the employee is going to work, what was
good and bad about the job, management, pay, and other benefits, training and career prospects,
working conditions and amenities.
In Hotel Akshaya, exit interviews are conducted to assess the reason for job change. But most of
the time, management feels the reasons to be invalid or not genuine.
Compensation:
17
Direct financial benefit being the basic rate of pay as well as any bonuses paid.
Indirect financial benefit being regular or intermittent payments not related to performance made
for employee contributions to the company or for loyalty or commitment. This could be bonuses
for suggestions, pension plans etc.
Non- financial benefit aims to increase the morale of employees.
With an annual increase on base salary, a pay change of 10 per cent to 15 per cent is probably
required to increase motivation.
Performance related pay and incentive features:
Incentives and performance related pay often define the working relationship between employer
and employee. The working assumption is that the person doing the work has to be goaded into
action.
Performance-related pay (PRP) arrangements typically embody the view that those who may
receive the payments are loyal, keen and hardworking. Incentive schemes are most common
among people at the bottom of the organizational hierarchy; performance-related schemes are
most common at the top.
An assumption of PRP is that monetary incentives linked to performance will act as a motivator
and increase performance.
The expectancy theory links concepts of expectancy instrumentally and valence suggests that
only if rewards are valued will individuals adjust their behaviours to attain them.
Hotel Akshaya has a formal process of selection of the employees for PRP which is as follows:
• Considering the review and ratings on online travel websites like Make My Trip and Trip
Advisor. The employee with best rating or review is recognized and rewarded on a
monthly basis with some amount of cash. The employees are even encouraged to talk to
the customers whom they service to request for the online rating/review.
18
• In addition, each employee is monitored for the hard work and overtime hours put into
the work when need be (for eg, extra hours filled during banquet parties). Thus overall
individual performance & efforts are recognized.
Non-financial rewards:
Reward is a holistic concept, which includes extrinsic (external and including pay and benefits)
and intrinsic (internal and non-financial) elements. Extrinsic factors include pay, job security,
working conditions, quality of supervision, organizational policies and administration and
interpersonal relationships. Intrinsic factors include a sense of achievement, recognition,
responsibility, interest in the work itself and potential for growth and self-actualization.
Hotel Akshaya has been fair enough is motivating employees at all levels in each department
with its concept of EMPLOYEE OF THE MONTH where every employee is given a chance
every month and the cycle is repeated so that all the employees get a chance to be recognized.
The employee’s photo would be displayed as a non-financial recognition act.
Benefits:
Benefits are any items or services that employers offer to employees although not legally bound
to do so; which are often seen as part of the contract of employment, such as sick pay, holiday
entitlement, maternity pay and paternity leave and flexibility of hours. Benefits rarely make an
immediate impact on performance but can help commitment in the long term.
It was found that Hotel Akshaya does not have any particular benefits apart from the generally
followed ESI and PF schemes.
Training and development:
Though uncommon in this industry unless it is a 5-star hotel, Training and development is
practiced at Hotel Akshaya where external people are invited to come over and impart the
trainings which enables the employees to gain self/career development through the firm.
Succession management:
19
Firms aim at succession management by identifying, assessing & developing an organization’s
leadership capabilities to enhance its performance.
Hotel Akshaya does not have any Build strategy for the same. The 30 old employees are still in
the same positions and in same departments as the management needs them for the same work.
So no promotions have been given to these employees. Instead they hire talent from the external
market for their key positions (Buy strategy).
HRIS:
HRIS is a recent concept of IT solutions being adopted across all industries to enable employers
to organize and carry out administrative tasks in an incredibly efficient and streamlined manner.
Hotel Akshaya has adopted Ezeetechnosys (http://www.ezeetechnosys.com/) which is an
integrated hospitality solutions covering from front desk to online booking to digital restaurant
table menu to the payroll systems (via punching attendance) to generate pay slips for the
employees.
20
21
22
23
Workforce Diversity:
All firms across all industries face diversity in the workforce.
In Hotel Akshaya, only the utility and housekeeping employees are females; all others are men.
Hence there is gender workforce diversity seen here.
24
Overall business strategy:
Any firm should have its business strategy in first place to gain competitive advantage in the
market.
Hotel Akshaya has adopted cost-leadership as its business strategy wherein the pricing of the
services is offered at lower rate without compromising on its quality of hospitality. The
proprietor claims of its evidence through the feedback and reviews received by his customers.
4. Findings:
• Using formal and informal methods of recruitment process, Hotel Akshaya is able to fill
its job vacancies.
• Specific questions during selection interviews help the hotel management to understand
key sources of its labour supply.
• The assessment method is restricted to only the Chef role.
• By creating a motivating environment and by using strategic and innovative recognition
& compensation methods, Hotel Akshaya retains its employees and thereby reduces the
turnover.
• However, the exit interview seems to have a biased mindset. Management finds the
reasons to be invalid which might not be true.
• The benefits are very generic to the industry standards and not much policies are
implemented in that perspective to further motivate the employees.
• Hotel Akshaya has no promotional/career development plan for employees.
• Use of HRIS is an added advantage.
• Workforce diversity is found in terms of gender ratio.
25
• In par with its cost-leadership business strategy, Hotel Akshaya has been hiring people
who are adaptable, trainable and willing to follow standard procedures (highly evident in
the staff who have been working without promotions).
• Overall, the hotel seems to follow traditional staffing methods.
5. Conclusion:
The hospitality industry suffers from a poor image as a low skill, low pay, high turnover
industry, which is not seen as an exciting career choice for employees particularly at supervisory,
and management levels. They then tend to move often as they perceive hours and pay to be poor
and therefore are constantly looking for a reason to move to another position in the industry or
outside.
Interviewing is somewhat unstructured not always using the resources of the Human Resources
department as well as the technical experts. Advanced methods of recruitment using assessment
centres etc are rarely used to ensure that the best candidates are chosen. Most candidates leave as
they are looking for a new challenge in their role and factors such as pay and hours do contribute
to employees leaving but they are not the prime reason.
Employees see non-financial benefits of good training and career development as important and
encouragingly they are present in industry. Pay systems other than basic pay are very limited and
not in line with other industries.
The industry by its nature attracts workers for different reasons. Being a low skill industry also
attracts transient employees who can relatively easily find work when it suits them in the
knowledge that there is a plentiful supply to move on to. In some areas the seasonality of
employment is a factor. The industry often sells itself on the need for few or no entry
qualifications, therefore attracting in general a less qualified and disciplined workforce. It can
26
also result in individuals joining as a second option if grades were not obtained for their chosen
industry, which often reflects in their motivation. As a result of the high competition for
employees, there is a common need for recruits at short notice due to the availability of work and
individuals often not completing notice periods with employers. Severe shortages of employees
hampering levels of service to the industry means that individuals are often recruited who do not
have the skills for the job therefore perpetuating the problem.
Though the industry in general has these shortfalls, Hotel Akshaya has proven itself to be quite
successful in staffing by attaining good talent, retaining and developing them and in turn
reducing the overall turnover rate. However the management should consider the benefits
policies & exit interviews seriously for the employee welfare and for self-introspection
respectively.
6. Recommendations:
• With its atmosphere being such employee oriented, Hotel Akshaya can strengthen its
Employer Brand to gain competitive advantage in the market (for eg, focus on external
brand strategy-continue social media, implement sponsorship, conferences, events).
• Referral program incentives could be introduced to keep employees engaged in the
staffing strategy.
• Behavioural interviews to be conducted to distinguish the top performer from the average
ones- specific behavioral traits stand out as the key to their success, they fall into four
categories: Motivation – what drives a person, Thinking – how to gather information and
reach a decision, Acting – how they do their job, Interaction – how they interact with
others.
• Succession planning can be considered by the hotel to work in a more professional way
to retain the talent with career development opportunity.
• Workforce diversity can be reduced by hiring more women staff.
27
• Assessment centres for all job levels must be followed instead of only for chef.
• Benefit policies like paid sick leave, health insurance schemes, educational aids to the
illiterate man power, etc should be included for further employee welfare.
• Exit interviews should be taken seriously by management without biased based
judgements, though turnover rate low, so that it provides scope for further improvement
of the hotel.
28
Bibliography
 Wasmuth and Davis, (1983, May) Managing Employee Turnover: Why Employees Leave, The
cornell hotel and restaurant quarterly, pp.11 – 18.
 Woods, R.H., and Macaulay, J.F (1998, May). Rx for turnover: Retention programs that work.
The cornell hotel and restaurant quarterly, pp.79-90.
 www.worldatwork.org
 www.hotelakshaya.in
 http://www.ezeetechnosys.com/product.php
29

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A PROJECT REPORT ON ANALYSIS OF THE STAFFING PROCESS IN THE HOTEL INDUSTRY

  • 1. A PROJECT REPORT ON ANALYSIS OF THE STAFFING PROCESS IN THE HOTEL INDUSTRY SUBMITTED TO SYMBIOSIS INSTITUTE OF BUSINESS MANAGEMENT BY Nitya N, Sharmita Bose, Monalisa and Punit Sharma IN PARTIAL FULFILLMENT OF EXECUTIVE MBA (HRM) JUNE, 2015-2017 # 95/1.95/2, Electronic City, Phase 1, Hosur Road, Bangalore- 560100 1
  • 2. Chapter No Title Page No Declaration 3 Acknowledgement 4 1 Introduction 1.1 Background of the study 5 1.2 Background of the topic 7 1.3 Company Profile 8 1.4 Research Topic 10 1.5 Need of the study 10 1.6 Scope of the study 10 1.7 Objectives of the study 10 2 Research Methodology 2.1 Research Design 12 2.2 Primary Data 12 2.3 Secondary Data 12 2.4 Sample Design 12 2.4.1 Sample Size 12 2.4.2 Sampling Method 12 2.5 Methods of Data Collection 13 2.5.1 Instrument of Data Collection 11 2.5.2 Drafting of Questionnaire 11 2.6 Field Work 13 2.7 Data Analysis Techniques 14 2.8 Limitations 14 3 Data Processing and Analysis 14 4 Findings 25 5 Conclusion 26 6 Recommendations 27 7 Bibliography 29 2 CONTENTS
  • 3. Declaration We hereby declare that project Titled “The Staffing Process in the Hotel Industry” is an original piece of research work carried out by us under the guidance and supervision of Mr. G. Mohan Prasad(Proprietor of Hotel Akshaya) and Prof. Dinesh. The information has been collected from genuine & authentic sources. The work has been submitted in partial fulfillment of the requirement of MBA to our college, SIBM, Bangalore. Place: Bangalore Signature: …………………….. Date: Nitya N Sharmita Bose Monalisa Punit Sharma MBA-2015-2017 3
  • 4. Acknowledgement The success and final outcome of this project required a lot of guidance and assistance from many people and we are extremely fortunate to have got this all along the completion of our project work. Whatever we have done is only due to such guidance and assistance and we would not forget to thank them. We respect and thank Mr. G.MOHAN PRASAD, for giving us an opportunity to do the project work in Hotel Akshaya and providing us all support and guidance which made us complete the project on time. W are extremely grateful to him for providing such a nice support and guidance though he had busy schedule managing the company affairs. We owe our profound gratitude to our internal project guide and lecturer, Prof. Dinesh, who took keen interest on our project work and guided us all along with valuable suggestions, till the completion of our project work by providing all the necessary information for developing a good system. We are thankful to and fortunate enough to get constant encouragement, support and guidance from our Prof. Dinesh, lecturer of Talent Acquisition which helped us in successfully completing our project work. 4
  • 5. 1. INTRODUCTION 1.1 Background of the study: The hospitality industry is considered to be the world’s fastest growing industry contributing for only 2% of the GDP in 2003-04. However, it is projected to grow at a rate of 8.8% by 2016, which would place India as the second-fastest growing tourism market in the world. This increasing importance was the result of vigorous process of expansion undertaken in the last decades. As a consequence, hospitality organizations expanding to a global market have started to face the challenge of selecting and managing an increasingly multicultural workforce. The fact that people from dissimilar cultural backgrounds , values, beliefs, behaviors and expectations were joining the industry demands a new approach to the selection process .Hence the use of effective and culturally sensitive selection methods are more important than ever .It becomes one of the key factor of success for hospitality organizations in their process of nationalization or internationalization and an important issue for academics or practitioners at the beginning of the millennium. On one side, it’s a necessity of shifting towards a more sophisticated Human Resource Management Approach that takes into account the selection of staff from diverse cultural backgrounds. Thus, the most important challenge for the hotel industry was none other than the Selection process followed by recruitment and retention. Historically, the hospitality industry has drawn heavily from the dissimilar background labor pool to meet their workforce needs, but the industry has been left with an insufficient pipeline of new workers to satisfy demand. Faced with a shrinking pipeline of workers, the hospitality industry is increasing its recruitment efforts towards youth and developing targeted strategies for previously untapped labor pools. Employers had difficulty finding workers who possess basic 5
  • 6. "soft skills," which are often a prerequisite for success in a customer service-oriented field. English proficiency was a key challenge because a large percentage of the hospitality workforce did not speak English in order to deal with various types of customers. Employers never used to provide language training programs which could allow workers to effectively perform their job, and include providing quality customer service and understanding safety requirements. The hospitality industry as a whole lacked consistency and portability in training models and skill certifications. High turnover was a key challenge in the hospitality industry. The restaurant, hotel and lodging sectors had difficulty retaining skilled workers because of the negative image that the industry faces. Many hotels used to treat employee recruitment at the same level as their corporate branding efforts, realizing that the two go hand in hand. But, the traditional recruitment effort has completely shifted over the last several years. In recent years, it is observed that the entire recruitment process is like a “ time bomb” for the hotel industry. When things are slowly picking up in the hotel industry, employers are becoming increasingly selective with whom they hire. The quality of employees, after-all, reflects the quality of service, which in turn determines whether a hotel is going to be successful or not since experience is a consumer's bottom line. The importance of finding good employees, especially youth workers with adequate talent and soft skills, is a high priority for the industry .Hotel jobs are found rarely advertised in the classified section of newspapers. Hotels are now using colorful full-page ads, job aggregators, and industry specific job boards to attract candidates to appealing "careers" rather than jobs. Recruitment strategies have changed significantly over the last fourteen years. A majority of today's employees are hired from online applications and get retained by the company through higher compensation and benefits. Employers started providing various kinds of training programs which could allow workers to effectively perform their job, and include providing quality customer service and understanding safety requirements. The hospitality industry gained consistency and portability in training models and skill certifications. Thus, we are interested on the whole staffing process in the hotel industry like how does it work in reality after observing the inconsistency between theory and practice within the industry. In 6
  • 7. other words, in recent years the approach which is adopted by the hotel recruiters during selection processes, followed by recruiting, retaining and deploying the talent , has been documented in this study of research. The purpose of the report is to look at recruitment, selection and retention methods used in the hotel industry. Thus, firstly, to discuss relevant previous findings in connection with aim of this study. Secondly, to provide new evidence about the current practices or data analysis in relation to the staffing methods used by the industry. The study has been structured in three parts. The first part focuses on Research Methodology in order to analyze key topics strongly related to the aim of this study .The second part describes the details of an exploratory research conducted with the purpose of Data Analysis. The third part includes both a Systematic analysis of the Research Findings and the final discussion regarding links between theory and findings followed by Recommendations. 1.2 Background of the topic: Topic is to analyze the staffing process of the chosen firm (Hotel Akshaya, Vishakapatnam) from the hotel industry in order to utilize our knowledge to recommend further implementations that could help the firm achieve a greater competitive business advantage. 1.3 Company Profile: 7
  • 8. Introduction: Hotel Akshaya nested in the heart of Visakhapatnam, Andhra Pradesh, India is easily accessible to downtown business centers, Tourist attractions, Shopping and Dining places. It is a Business Class hotel having 27 Executive Rooms and 3 Deluxe Rooms; rooms providing exquisite facilities and services of executive standards. They have a tasty multi-cuisine restaurant “ Tasty Point”, secure, round the clock communication networks, well planned banquet hall named “Canopy” and mini-conference hall named “ Swagat”, etc. The hotel was designed with the business and family travelers in mind. The goal at the Hotel Akshaya is to ensure that their guests feel welcomed from the day of the arrival until their departure. Their standards and personal level of quality service ensure that their guests enjoy a memorable stay. 8
  • 9. Company Profile: Hotel Akshaya began its journey in the year 2008 to crave for itself a niche in the Hospitality industry. Name of the Company AKSHAYA Year Of Establishment 28th February,2008 Company’s Address Opp.DRM office,Dondaparthi,Vizag- 530016,Andhra Pradesh, India Phone +919908664422 Email mail@hotelakshaya.in Website www.hotelakshaya.in Proprietor Mr. G. Mohan Prasad Nature Of ownership Private Limited Company Nature Of Business Hospitality/Hotel Industry 1.4 Research Topic: 9
  • 10. To critically analyze the Talent Acquisition or Staffing Process of Hotel Akshaya and to recommend further implementations that could help the firm achieve a greater competitive business advantage. 1.5 Need of the study: The need of this study is to know the recruitment, selection and retention methods used in the hotel industry in order to enhance our practical knowledge about the staffing process in this industry. 1.6 Scope of the Study: The aim of our study is to explore the extent of Staffing by looking at the best practice for recruitment, selection and retention in the private sector of the hotel industry by analyzing the prospects of each area and its components; looking at studies conducted which relate to the industry and analyzing this with a snapshot of current practice within the industry as well as perceptions of benefits and reward expected from employees to draw realistic and practical conclusions for the way forward. 1.7 Objectives of the study: Primary Objectives:  To understand the process of staffing.  To review and analyze recruitment, selection and retention methods from a theoretical point of view in the hotel industry.  To understand what the industry offers in terms of financial and non-financial benefits and their relevance.  To review of additions to basic pay offered by the industry. 10
  • 11.  To know the sources of recruitment at various levels and jobs. Secondary Objectives:  To identify the probable area of improvement to make staffing procedures more effective.  To analyze themes from the research which relate to industry issues and produce recommendations for improvements and best practice. 11
  • 12. 2. RESEARCH METHODOLOGY: 2.1 Research Design: The research design adopted in this study is exploratory. The objective of this is to gather preliminary information that will help define the problem and to describe the characteristics of various aspects like to determine the staffing, recruiting process and retention methods in the hospitality industry. 2.2 Primary Data: The primary data was collected by the authors by conducting structured interviews with the sample. 2.3 Secondary Data: The secondary data was obtained from the internet sources like the hotel website. 2.4 Sample Design: Non probability sampling method was used here as the sample was not random and was determined beforehand. 2.4.1 Sample Size: The sample size is the employee strength of the hotel which is 48 including the 5 heads of the departments- Food & Beverage, House Keeping, Front Office, Maintenance, Accounts and the proprietor who represented all of them for our structured interviews. 2.4.2 Sampling Method: A purposive or judgmental sampling technique was used here. Since the objective of the interviews were to collect data on the internal processes of staffing, recruiting and retaining the employees of the hospitality industry, only the 5 heads of department and the proprietor comprised the sampling as the need was specific to internal procedures and decisions. 12
  • 13. 2.5 Method of Data collection: The method of data collection was through telephonic structured interview. The authors approached the proprietor(who represented the entire staff) and conducted a structured interview regarding the various aspects of staffing, recruiting and retaining in their hotel. 2.5.1 Instrument of Data collection: Questionnaire (through telephone) was the data collection tool used. 2.5.2 Drafting of Questionnaire: The questions asked in the structured interview are as follows:  Which recruitment media do job applicants look in?  How do you generate the pool of candidates to apply for the jobs at your hotel?  Which of these methods results in the most number of jobs offered?  Who carries out the recruitment drives?  While hiring, what are the questions asked?  What are the main reasons why employees leave?  What are the benefits and incentives provided to the employees?  Which of these benefits are most appreciated by the employees?  What are the non-financial aspects offered in order to retain the talent?  What challenges do you face in retaining the talent and how do you overcome them?  How do you manage performance of the staff?  What are the competitive measures taken by the company to retain the talent? 13
  • 14. 2.6 Field Work: Primary data was collected with the help of structured telephonic interviews that included conference calls. 2.7 Data Analysis Techniques: Qualitative data analysis technique has been followed by the authors as the research design is descriptive. 2.8 Limitations: Although the research has reached its aims, there were some unavoidable limitations. Firstly, there was no actual field work involved in this research due to time constraint and feasibility, telephonic interviews were our primary source of data. Direct conversation at the hotel premises would have been apt as the authors could have got more accurate primary data through other more reliable methods such as observations. Secondly, the sampling design was non-probability sampling wherein the samples could be bias-based and gatekeepers to the responses. Better response would have been obtained if it was a probability sampling. 3. Data Processing and Analysis: With employee strength of 48 staff, 30 being the old staff, Hotel Akshaya has been successfully thriving in the market with a quite healthy staffing process. Recruitment: Methods of recruitment: Formal and informal methods. Formal methods must attract attention, create and maintain interest and stimulate action. 14
  • 15. Informal methods are where employees, suppliers or personal acquaintances get to hear about the vacancy via word of mouth. There is often a reward for the introducee when the employee successfully completes an induction period. The hotel has a combined method of both formal and informal methods- via newspaper advertisements/resume database (social media does not play a major role in the supply of labour for this hotel) and employee reference by old or new staff or by the management relationship with the external contacts who refer candidates to the hotel. Selection: The selection process enables the organization to decide which people best fit its needs and individuals to decide to what extend the organization fits their needs. Unless selectors are very clear about what they are looking for then it is difficult for them to know when they have found it. Selection criteria can be at three different levels: organizational, functional/departmental and individual job criteria. The choice of the selection methods will depend on factors such as type and level of job, abilities of the managers involved, time required, accuracy demanded and cost. Interviews: The style of interviews usually reflects the job specification. Most interviews assess general abilities, experience and cultural suitability; if experience is not a prerequisite then it may be based on personality and attitude. They should provide the answers to three questions: 1. Can the individual do the job? Is he or she competent? 2. Will the individual do the job? Is he or she motivated? 3. How is the individual likely to fit into the organization? Structured interviews The individual interview is most popular but can be open to most bias or superficial decision. Interviewing panels with two or more people to interview one candidate are frequently preferred, usually the Human Resources Manager and the Line Manager together. Selection boards that are 15
  • 16. more formal with a larger selecting panel have an advantage that more people can see the candidate and compare notes at one time but disadvantage is that questions tend to be unplanned and delivered at random. Specific to Hotel Akshaya, the below questions are asked as a part of interview process: 1. What was the candidate’s last experience? 2. How does the candidate know about the hotel? (to assess the source of reference) 3. What is the candidate’s expectation from the role? 4. What is the candidate’s expected salary? Assessment centres These involve a range of assessment techniques. A benefit of their use is to show and indicate the extent to which candidates match the culture of the organization observed through their behaviour in different situations, a range of tests and structured interviews are considered. Assessment test in Hotel Akshaya is conducted only for the Chef role during recruitment where in the candidate is asked to prepare 2 Vegetarian and 2 Non Vegetarian dishes; based on which final decision is taken for selection. Retention: It is important to distinguish between recruitment and retention. The greater part of recruitment is to replace labour, i.e. following a failure to retain, although this does not necessarily imply that the failure to retain reflects adversely on the firm. It could be that the employee is testing if they actually want to do a certain job role and find that they do not or it could be the employer who makes errors in recruitment and has to deal with the situation. Thus not all recruitment, which is caused by non-retention of labour, is to be criticised. A good deal of non-retention is seen rightly by business as indicative of failure of policy and its application somewhere along the line. When complaining about recruitment difficulties business should be examining the causes of turnover difficulties. 16
  • 17. People may leave because they cannot obtain the rewards or job conditions enjoyed by others. Concepts of fairness and equality are very relevant in retention, and depend considerably on the benefits and conditions seen or believed to be enjoyed by others. The way in which we value features of jobs and our degree of satisfaction is strongly influenced by what we believe others are receiving; whether our belief is based on fact or error is not so important. Some industries/firms decided that it is better to accept high turnover as long as there is a continuing flow of recruits willing to enter its employ, even if only for short periods. Other industries may find that its labour force is too stable, with the effect that the average age is high with great bunching, and consequential problems for future flows of adequately trained and qualified workers. If the labour force is too stable, attitudes can become fossilised and change and adaptation made much more difficult. As it seen that Hotel Akshaya has retained almost 30 employees out of the 48 employee strength, it suggests that the hotel has a healthy practice of employee retention. It was noted that the atmosphere created by the management is a key factor for employee retention. Employees are recognized and rewarded for their performance equally which has helped the hotel motivate them and retain them. Not only are employees are rewarded, but they are considered for the managerial decisions through the suggestions/ feedback which they provide in the Suggestion Box. Exit interview: Ideally should not be carried out by someone too senior or the employees line manager. The interviews must find out the reason for leaving, where the employee is going to work, what was good and bad about the job, management, pay, and other benefits, training and career prospects, working conditions and amenities. In Hotel Akshaya, exit interviews are conducted to assess the reason for job change. But most of the time, management feels the reasons to be invalid or not genuine. Compensation: 17
  • 18. Direct financial benefit being the basic rate of pay as well as any bonuses paid. Indirect financial benefit being regular or intermittent payments not related to performance made for employee contributions to the company or for loyalty or commitment. This could be bonuses for suggestions, pension plans etc. Non- financial benefit aims to increase the morale of employees. With an annual increase on base salary, a pay change of 10 per cent to 15 per cent is probably required to increase motivation. Performance related pay and incentive features: Incentives and performance related pay often define the working relationship between employer and employee. The working assumption is that the person doing the work has to be goaded into action. Performance-related pay (PRP) arrangements typically embody the view that those who may receive the payments are loyal, keen and hardworking. Incentive schemes are most common among people at the bottom of the organizational hierarchy; performance-related schemes are most common at the top. An assumption of PRP is that monetary incentives linked to performance will act as a motivator and increase performance. The expectancy theory links concepts of expectancy instrumentally and valence suggests that only if rewards are valued will individuals adjust their behaviours to attain them. Hotel Akshaya has a formal process of selection of the employees for PRP which is as follows: • Considering the review and ratings on online travel websites like Make My Trip and Trip Advisor. The employee with best rating or review is recognized and rewarded on a monthly basis with some amount of cash. The employees are even encouraged to talk to the customers whom they service to request for the online rating/review. 18
  • 19. • In addition, each employee is monitored for the hard work and overtime hours put into the work when need be (for eg, extra hours filled during banquet parties). Thus overall individual performance & efforts are recognized. Non-financial rewards: Reward is a holistic concept, which includes extrinsic (external and including pay and benefits) and intrinsic (internal and non-financial) elements. Extrinsic factors include pay, job security, working conditions, quality of supervision, organizational policies and administration and interpersonal relationships. Intrinsic factors include a sense of achievement, recognition, responsibility, interest in the work itself and potential for growth and self-actualization. Hotel Akshaya has been fair enough is motivating employees at all levels in each department with its concept of EMPLOYEE OF THE MONTH where every employee is given a chance every month and the cycle is repeated so that all the employees get a chance to be recognized. The employee’s photo would be displayed as a non-financial recognition act. Benefits: Benefits are any items or services that employers offer to employees although not legally bound to do so; which are often seen as part of the contract of employment, such as sick pay, holiday entitlement, maternity pay and paternity leave and flexibility of hours. Benefits rarely make an immediate impact on performance but can help commitment in the long term. It was found that Hotel Akshaya does not have any particular benefits apart from the generally followed ESI and PF schemes. Training and development: Though uncommon in this industry unless it is a 5-star hotel, Training and development is practiced at Hotel Akshaya where external people are invited to come over and impart the trainings which enables the employees to gain self/career development through the firm. Succession management: 19
  • 20. Firms aim at succession management by identifying, assessing & developing an organization’s leadership capabilities to enhance its performance. Hotel Akshaya does not have any Build strategy for the same. The 30 old employees are still in the same positions and in same departments as the management needs them for the same work. So no promotions have been given to these employees. Instead they hire talent from the external market for their key positions (Buy strategy). HRIS: HRIS is a recent concept of IT solutions being adopted across all industries to enable employers to organize and carry out administrative tasks in an incredibly efficient and streamlined manner. Hotel Akshaya has adopted Ezeetechnosys (http://www.ezeetechnosys.com/) which is an integrated hospitality solutions covering from front desk to online booking to digital restaurant table menu to the payroll systems (via punching attendance) to generate pay slips for the employees. 20
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  • 24. Workforce Diversity: All firms across all industries face diversity in the workforce. In Hotel Akshaya, only the utility and housekeeping employees are females; all others are men. Hence there is gender workforce diversity seen here. 24
  • 25. Overall business strategy: Any firm should have its business strategy in first place to gain competitive advantage in the market. Hotel Akshaya has adopted cost-leadership as its business strategy wherein the pricing of the services is offered at lower rate without compromising on its quality of hospitality. The proprietor claims of its evidence through the feedback and reviews received by his customers. 4. Findings: • Using formal and informal methods of recruitment process, Hotel Akshaya is able to fill its job vacancies. • Specific questions during selection interviews help the hotel management to understand key sources of its labour supply. • The assessment method is restricted to only the Chef role. • By creating a motivating environment and by using strategic and innovative recognition & compensation methods, Hotel Akshaya retains its employees and thereby reduces the turnover. • However, the exit interview seems to have a biased mindset. Management finds the reasons to be invalid which might not be true. • The benefits are very generic to the industry standards and not much policies are implemented in that perspective to further motivate the employees. • Hotel Akshaya has no promotional/career development plan for employees. • Use of HRIS is an added advantage. • Workforce diversity is found in terms of gender ratio. 25
  • 26. • In par with its cost-leadership business strategy, Hotel Akshaya has been hiring people who are adaptable, trainable and willing to follow standard procedures (highly evident in the staff who have been working without promotions). • Overall, the hotel seems to follow traditional staffing methods. 5. Conclusion: The hospitality industry suffers from a poor image as a low skill, low pay, high turnover industry, which is not seen as an exciting career choice for employees particularly at supervisory, and management levels. They then tend to move often as they perceive hours and pay to be poor and therefore are constantly looking for a reason to move to another position in the industry or outside. Interviewing is somewhat unstructured not always using the resources of the Human Resources department as well as the technical experts. Advanced methods of recruitment using assessment centres etc are rarely used to ensure that the best candidates are chosen. Most candidates leave as they are looking for a new challenge in their role and factors such as pay and hours do contribute to employees leaving but they are not the prime reason. Employees see non-financial benefits of good training and career development as important and encouragingly they are present in industry. Pay systems other than basic pay are very limited and not in line with other industries. The industry by its nature attracts workers for different reasons. Being a low skill industry also attracts transient employees who can relatively easily find work when it suits them in the knowledge that there is a plentiful supply to move on to. In some areas the seasonality of employment is a factor. The industry often sells itself on the need for few or no entry qualifications, therefore attracting in general a less qualified and disciplined workforce. It can 26
  • 27. also result in individuals joining as a second option if grades were not obtained for their chosen industry, which often reflects in their motivation. As a result of the high competition for employees, there is a common need for recruits at short notice due to the availability of work and individuals often not completing notice periods with employers. Severe shortages of employees hampering levels of service to the industry means that individuals are often recruited who do not have the skills for the job therefore perpetuating the problem. Though the industry in general has these shortfalls, Hotel Akshaya has proven itself to be quite successful in staffing by attaining good talent, retaining and developing them and in turn reducing the overall turnover rate. However the management should consider the benefits policies & exit interviews seriously for the employee welfare and for self-introspection respectively. 6. Recommendations: • With its atmosphere being such employee oriented, Hotel Akshaya can strengthen its Employer Brand to gain competitive advantage in the market (for eg, focus on external brand strategy-continue social media, implement sponsorship, conferences, events). • Referral program incentives could be introduced to keep employees engaged in the staffing strategy. • Behavioural interviews to be conducted to distinguish the top performer from the average ones- specific behavioral traits stand out as the key to their success, they fall into four categories: Motivation – what drives a person, Thinking – how to gather information and reach a decision, Acting – how they do their job, Interaction – how they interact with others. • Succession planning can be considered by the hotel to work in a more professional way to retain the talent with career development opportunity. • Workforce diversity can be reduced by hiring more women staff. 27
  • 28. • Assessment centres for all job levels must be followed instead of only for chef. • Benefit policies like paid sick leave, health insurance schemes, educational aids to the illiterate man power, etc should be included for further employee welfare. • Exit interviews should be taken seriously by management without biased based judgements, though turnover rate low, so that it provides scope for further improvement of the hotel. 28
  • 29. Bibliography  Wasmuth and Davis, (1983, May) Managing Employee Turnover: Why Employees Leave, The cornell hotel and restaurant quarterly, pp.11 – 18.  Woods, R.H., and Macaulay, J.F (1998, May). Rx for turnover: Retention programs that work. The cornell hotel and restaurant quarterly, pp.79-90.  www.worldatwork.org  www.hotelakshaya.in  http://www.ezeetechnosys.com/product.php 29