Introduction
Employees must be supported and feel valued to retain them as part of the business strategy. The manager must understand and monitor all reasons that force employees to leave the organisation. There is a need to create an employee-centered environment, enhance the employer-employee relationship, and make the job more satisfying (Medina, 2012). The leadership style helps shape the organisational culture by satisfying employees’ needs. Analysis of the case study proves that disgruntled employees contribute to a high rate of staff turnover. Thus, the manager is responsible for creating a favourable environment and providing incentives to motivate and retain talented employees. This is important since an inspired, committed, passionate, and engaged workforce is the hallmark of competitive advantage in the hospitality industry.
Problem No#2: Staff Turnover
The Imperial Hotel in London is experiencing a dysfunctional staff turnover where valuable employees are leaving the hotel for various reasons before the expected end of their contract. From the case study, it is evident as indicated in the Problem #2 that each year the hotel experiences a high rate of staff turnover, with 80% of the employees leaving annually. The trend is a major concern for the management due to the negative effects on the hotel’s overall performance. The temporary nature of employment forces employees to work on a part-time basis or short periods, besides, they receive low wages, mostly an average of the city’s living wage rate. Additionally, the hotel has identified other problems from the exit interviews it has conducted, for instance, issues related to aggressive supervisory and management style, which lead to a poor perception of the hotel’s work culture.
Similarly, it has identified the hostile working hours, lack of training, poor remuneration, and the lack of promotion as major contributing factors. Lastly, the high transportation costs in Central London as well as challenges in commuting home at the end of the night shift also contribute towards the high attrition rates. Such unfavorable working conditions forced many employees to seek greener pasture in other hotels (Ehrhart and Kuenzi, 2017). Ultimately, the high rate of staff attrition increases operational costs which affect profitability as the hotel grapples with the high cost of replacement, recruitment, and induction training for new employees.
The lack of business continuity affects the delivery of quality services; besides, it reduces the hotel’s competitive advantage, and overall business growth. Staff turnover can also be attributed to lack of organizational commitment and reduced job satisfaction which leads to tardiness, absenteeism, stress, poor work performance, organizational ineffectiveness, operational bureaucracy, and poor succession plans (AlBattat and Som, 2013). The hotel must strategise to reverse the trend and enhance staff retention to compete specifically on timely delivery of quality services, cost effectiveness, and innovativeness to secure market leadership (Bryant and Allen, 2013).
Linking Problem, No#2 (Staff Turnover) to the Hotel’s Other Five Problems in the Case Study
Such an HR related issue as indicated in the Problem #2 can be connected to the concern raised in Problem #3, that is, a negative work culture demonstrated by the employees through poor attendance and a high rate of sick leaves taken. Secondly, the issues can be linked to the concerns raised in Problem #4, that is, the ineffective management and leadership by past Heads of Department and supervisorial staff, inclusive of weak control procedures and poor monitoring. The two problems must be closely monitored and remedied by Imperial Hotel’s top management to allow them to deal with the spiraling rate of staff turnover.
Usefulness of Peter Farnsworth’s Suggested Actions to Resolve the Specific Solution
The proposed remedies as suggested by Peter Farnsworth seek to address the ineffectiveness in management and leadership as well as the poor work culture. Good leadership directs, inspires, motivates, and influences employees to realize organizational goals. Combining leadership with monetary and non-monetary benefits helps to reduce staff turnover rates. Uncertainty regarding the future and feelings of being undervalued lead to job dissatisfaction, lack of work involvement, and lack of organizational commitment (Shuck et al. 2014). Ultimately, the employees fail to believe in the vision and delivery of the business strategy.
Many leadership and motivation theories explain the relationship between work culture, management/leadership, and staff retention. A detailed analysis of what motivates employees through relevant theories helps improve our understanding of employee retention since the high rate of staff turnover is costly to a firm primarily affecting revenue generated and profitability (Wallace and Gaylor, 2012). Besides, employee wastage leads to increased workload, shifting customer loyalty, the lack of customer referrals, and negative publicity, which affect the overall performance of the company. Employee turnover and retention are major issues which the hotel must address given the high payroll cost and the lack of skilled workforce (Liu et al. 2013). Such theoretical frameworks below can give a basis for implementing sustainable solutions to address the high rate of staff turnover at Imperial Hotel.
Adelfer’s Existence, Relatedness, and Growth (ERG) Theory
Alderfer’s ERG theory proposes that there are three dominant needs, namely, existence, relatedness, and growth. The existence needs can be regarded as the physiological and safety needs, which can be met through provision of competitive earnings and safe working conditions (Miner, 2015). Relatedness needs include promoting superior human relations or interpersonal relationships at the workplace. Growth needs relate to an employee’s desire for personal fulfillment, especially the desire to be creative and productive. Employees are leaving since their needs are not met; hence, adopting the ERG theory allows the Peter Farnsworth to identify the diverse employees’ needs, their behaviors, and strategizing to meet them to foster a sustainable workforce (Miner, 2015).
Vroom’s Expectancy Theory
The expectancy theory presumes that employees will demonstrate organizational commitment, motivation, and peak performance when they expect to receive equivalent returns (Champoux, 2016). Hence, Peter Farnsworth must seek to guarantee merit-based pay increase and job promotions to increase employee commitment and performance to allow them to achieve personal goals. The poor working conditions, the lack of growth opportunities, and poor compensation in return for work done will subsequently force employees to put minimal effort and ultimately force them to opt for alternative employers (Champoux, 2016).
Douglas McGregor’s Theory X and Theory Y
Theory X and Y are applicable in this case since they depict the two differing ends of the motivation continuum. Theory X argues that employees are fundamentally averse to work and they need to be persistently motivated from external sources (Swanwick, 2017). Whereas, Theory Y assumes employees are internally motivated at the workplace. Hence they use their experience and skills to realize their goals and personal fulfillment. The Theory X is highly applicable at the Imperial Hotel due to the nature of the employees and the work setting (Malakyan, 2014). They prefer minimal supervision and extrinsic factors to be motivated.
Maslow’s Hierarchy of Needs
Maslow argued that employees have basic needs, which are progressive, such as physiological, safety, social, esteem, and self-actualization, which they require for growth and development (Miner, 2015). According to Maslow, employees must satisfy their lower needs like safety before meeting their higher needs like personal growth, career development, self-esteem, and self-actualization. Peter Farnsworth must work to ensure the employees satisfy each level of their needs to enhance their organizational commitment and work involvement (Champoux, 2016). Failure to meet the needs within the hierarchy creates a sense of lack of fulfillment in employees’ professional lives, hence they seek an alternative employer who provides better opportunities.
Herzberg Two-Factor Theory
Herzberg’s motivator-hygiene theory or the two-factor theory expounds what satisfies or dissatisfies the workforce, thus it forms a good basis for employee retention (Daley, 2012). The theory assumes that there are some factors which lead to job satisfaction or dissatisfaction. The hygiene factors lead to motivation, and their absence leads to dissatisfaction. Alternatively, they are known as maintenance factors or dissatisfiers since they are needed to avoid dissatisfaction (Miner, 2015). Such physiological needs like pay, company policies, working hours, breaks, medical insurance cover, and vacation must be favorable and competitive. Similarly, the physical working conditions, work equipment, interpersonal relationship, and job security must be guaranteed to attract and retain top talent (Mowday, 2013).
Secondly, the motivator factors or satisfiers are inherent to the work itself, and they lead to superior performance. They are intrinsically rewarding, for instance recognition, sense of achievement, growth and advancement opportunities, sense of ownership, autonomy, as well as challenging and meaningful work, motivate employees to perform excellently (Champoux, 2016). The new manager can sparingly adopt and apply the two factors to strengthen employee loyalty, job satisfaction, and organizational commitment.
Blake and Mouton’s Managerial Grid
Robert Blake and Jane Mouton proposed the managerial or leadership grid to explain how people and task orientation are treated as two independent dimensions (Swanwick, 2017). On the grid’s y-axis, it is plotted how managers show their concern for people as they accommodate people’s needs and prioritize them. Secondly, on the x-axis, it depicts the manager’s concerns for production, especially how they keep tight schedules. The behavioral dimensions range from low (1) to high (9), thereby creating almost diverse positions which a leadership style might fall (Landis et al. 2014).
The major leadership styles can include the impoverished management, whereby the manager has low regard for work deadlines and employee satisfaction, leading to disorganization and disharmony within the company. The leaders are concerned with seniority and job security, leading to ineffectiveness (Swanwick, 2017). The second leadership style is task management, also known as perishing or dictatorial style, where the manager is less concerned with people as he focuses on production. The style leads to high employee turnover as the bureaucracy leads to dissatisfaction (Mowday, 2013). Thirdly, the middle-of-the-road relates to the compromising style as managers seek to balance between the company’s goals and people’s needs. The complacency leads to a lack of achievement of production or employees’ needs (Shuck et al. 2014).
The Country Club, also known as the collegial style, is characterized by high people orientation and low tasks, where the manager provides considerate attention to people’s needs, hence, it gives them a comfortable and friendly environment. Such an environment leads to self-motivation and self-determination (Champoux, 2016). Lastly, team management is based on McGregor’s Theory Y which is characterized by a high task and people focus. The manager seeks to create a team atmosphere of empowerment, respect, trust, and commitment which leads to high production and employee satisfaction (Landis et al. 2014). Peter Farnsworth must analyze the Managerial or Leadership Grid to determine his leadership style, particularly to adopt the team management or the country club style. There is a need to take into consideration the concerns of production and people, especially to reduce employee attrition (Medina, 2012).
Hersey-Blanchard Situational Theory of Leadership
According to the theory, good leadership is mostly task-relevant. Hence, the manager must flexibly adapt his or her leadership style to suit the group’s or individual’s maturity (Mowday, 2013). Peter Farnsworth must consider the people and tasks being done to allow him to adapt to the maturity level since no distinct leadership style matches all types of situations or circumstances. He must adaptably strive to encourage employees’ participation, work delegation, and creating a fun working environment to enhance employee retention (Wallace and Gaylor, 2012).
From the theories above, there is a need for the manager to promote standards, policies, rewards, employee training, and providing adequate resources for retaining skilled employees as their needs are met. A productive workplace supported by favorable HR policies and managerial styles, which are aligned with the business goals, treats employees as a valuable asset who in turn offer quality services (Liu et al. 2013). The manager must also adopt a suitable leadership style since it affects employees’ perception and shapes the organizational culture. Positive interactions allow the leader and employees to set mutual expectations as well as setting the culture and tone within an organization (Shuck et al. 2014). After analysis of the case study, I would recommend adoption of an employee-centric leadership style that is either the authentic, transformational, servant leadership, or the charismatic leadership style to ensure greater employee satisfaction, improved communication, deeper organizational commitment, stronger work culture, and operational efficiency (Lee et al. 2012).
Peter Farnsworth’s suggestions are very valuable and practical since they can tremendously reduce the level of staff turnover at Imperial Hotel. The manager should formulate a reward strategy and improve the employees’ remuneration on merit; besides, he should pay performance bonuses, promote the performing employees, and conduct regular training to motivate the employees and secure their loyalty (Malakyan, 2014). The company’s pay structure should competitively match the market’s rates as a retention strategy. The employees must also be customer-focused to allow them to deliver quality services and increase profitability, which ultimately might lead to an increase in pay and bonuses (Champoux, 2016).
Two Alternative Ways to Resolve the Specific Problem but Unconsidered in the Solution Proposed by Peter Farnsworth
Analysis of the case study indicates that Peter has not considered the unsociable working hours. He should formulate a new working schedule that favors all employees throughout the shifts. The manager can consider a few shifts with flexible and reasonable working hours (Ehrhart and Kuenzi, 2017). The manager can opt to introduce longer working hours during the night with a provision of overtime pay to all eligible employees. The employees will be able to leave their workplace in the morning and avoid the transport inconveniences. Additionally, the manager can opt to purchase or allocate a hotel’s bus or van to transport employees to their residence during the night (AlBattat and Som, 2013).
Alternatively, he can partner with a taxi company to shuttle employees after the late night shift. Many hotels within London have adopted such strategies, thus Imperial Hotel should adopt such best practices to gain a competitive advantage. Additionally, the hotel can also allow the employees to join a professional organization or trade union that can advance their interests (Medina, 2012). Furthermore, I would recommend that Peter should change its employee sourcing strategy to ensure it hires employees on long-term contracts. The part-time employees, including students, are unpredictable and uncertain. Hence, they contribute greatly towards increasing the high rate of staff turnover and its related costs (Bryant and Allen, 2013).
Conclusion
The London’s Imperial Hotel faces numerous interrelated organizational problems partly due to ineffectiveness and insensitivity to employees’ needs. For instance, nearly 80% of the employees leave the organization each year, but the company has identified the potential problems and possible solutions. As a result, applying the discussed retention strategies can positively influence an employee’s desires to remain in the company permanently. Regular training, dual communication, positive supervisor-subordinate relationship, financial inducement, flexible work arrangement, employee recognition, career development opportunities, and favorable work environment enhances employee retention.
References
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