Analysing the Hospitality Industry

UNIT NAME: CONTEMPORARY HOSPITALITY

ASSIGNMENT TITLE: ANALYZING THE HOSPITALITY INDUSTRY (2.1, 2.2, 2.3)

DATE ISSUED: 26/10/2016

DATE SUBMITTED: 09/11/2016

GROUP MEMBERS:

1. MICHELLE NKATHA
2. PHILLIP AGAGLIATE
3. ZIPPORAH MUTYAMBAI
4. MICHELLE SEMO
5. OCHIENG’ FIDEL MUSA

1. STAFF ISSUES AND PROBLEMS THAT PRESENT A CHALLENGE AND OPPORTUNITY TO MANAGERS IN OUR LOCAL HOSPITALITY INDUSTRY.

In our hospitality industry especially in Kenya, the managers and hotels in general are faced with several problems that affect them and their productivity.

1. STAFF ISSUES.

Staffing is the process of hiring, positioning and overseeing employee welfare in an establishment. The staffing process includes activities like manpower planning, recruitment, selection, placement, training, remuneration, performance appraisal, promotions and transfers. Staff issues may be defined as all the problems faced by an establishment throughout the staffing process. In Kenya, several staff issues are experienced by hotel managers and they are illustrated below:

1. Cost of Hiring.

In recent years, hiring of new employees to a hotel has become a relatively expensive process. Money is pumped into activities such as advertising, the internal recruiters and the interviewers have to be paid so as to perform the task of recruiting and selecting. For instance, the InterContinental Hotel, Nairobi, early this year introduced several new posts in their establishment such as the Finance and Business Support Manager, the assistant revenue manager, the linen clerk, the reliever and many more. On average, the process of hiring cost them almost Kshs. 500,000. Broken down as follows:

Cost of advertising (Newspaper Ads) - Kshs. 150,000

Cost of background checks and tests – Kshs. 80,000

Human Resource Department cost- Kshs. 100, 000

External Interviewers’ cost (IHG) – Kshs. 200, 000

                                Source- Human Resource, the InterContinental Hotel, Nairobi.

This process is turning out to be more and more expensive to hotel managers. A reason that is forcing them to opt for seasonal, contract or unskilled employees. An option they see fit so as to keep the hotel running.

1. Cost of Training.

After a new employee has been hired, the hotel has to ensure he or she is equipped with the right skills and mind-set to enable them work towards one common goal. Thus the hotel has to incur the cost of training. This is because the cost of time, depending whether the employee is a fast or slow learner, is still incurred. The personnel, whether internal or external, training the new employee, has to be paid. All these costs and activities prevent a hotel from delivering efficiently. For instance, a hotel hires a waiter who has little industrial exposure, thus is under skilled. The restaurant manager has to break away from his normal duties so as to show the waiter what exactly is required of them. The manager’s duties will be behind schedule and the productivity of the restaurant will be affected to some extent.

1. Cost of Salaries and Benefits

This is considered a constant cost by most, if not all, managers in the country. Even though this cost has been constant for a while, it is now starting to get more and more expensive to hotels. Employees with the skilled labour are demanding for increased salaries and since they are needed in our hotel industry, the hotels have no other choice but to meet their demands. Even though unskilled labour is termed as cheap, the more they are employed, the more expensive it gets to hotels.  

1. High Employee Turnover Rate

Employee turnover is the number of employees that quit in an establishment and are replaced. In Kenya, employee turnover is majorly caused by employees being able to find better jobs in other countries. Since jobs out of the countries offer better pays and mostly better working conditions, employees working in Kenya cannot resist the temptation of finding jobs there and quitting their jobs in hotels in the country. This in turn slows down the hotel’s operations since they have to be replaced. For instance, the InterContinental Hotel, Nairobi reported that most of their Kenyan employees end up quitting their jobs to look for employment elsewhere, just for the better pay and working conditions.

1. Difficulty to Retain Experienced Employees.

Skilled experienced labour is what employers in Kenya’s job market are searching for. They even go to the extent of “poaching” labour. This is when one employer offers an employee of another hotel better terms of work hence making the employee to start working for them. For a hotel to stop their experienced employee from quitting and going to work for a competitor, it’s gradually getting harder. And when they leave, replacing them is an even expensive task to the hotel.

1. Unskilled Labour.

In the current job market, the demand for skilled labour is growing as days go by. Fact is, the number of people with skilled labour, especially specialized skilled labour, is very few. In the hospitality industry, the technical specialized skill is considered very important and since very few people are equipped with that, the hotels have no other choice but to employ unskilled labour. They consider unskilled labour as cheap labour, but they in the long run end up spending on activities such as training, induction and many more.

1. Divisions amongst Staff.

Whether it’s along tribal lines, political differences or internal misunderstanding, employees sometimes may differ in opinion. A situation that often leads them to taking sides and not work together. A situation like this will reduce the efficiency and productivity of the staff and hence the hotel might suffer losses or even lose customers.

1. Job Insecurity amongst the Staff.

Job insecurity is the condition where employees lack assurance that they will keep their job for a long time. With the current situation in the country of the number of travellers reducing due to various reasons, hotels are looking for ways to reduce cost and one way of doing this is through firing employees so as to reduce labour cost. Employees become worried and hence demotivated. The contract employees live with the worry that their contracts might be terminated at any time. Thus they lack the motivation and hence their production rate reduces. This might lead to loss of customers and employees since they will look for a hotel that will assure them to keep their jobs.