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Human Resource Management Safdar Nazeer Assistant Professor CIIT Wah

How Hampton Inn Guarantees "100% Satisfaction"

Hampton Inn, a national hotel chain with over 7,000 employees, recently introduced a "100% Satisfaction Guarantee" policy to help it gain a distinctive advantage in a highly competitive industry where customers have little allegiance to any particular hotel. When guests walk away from a hotel dissatisfied, chances are that they will relate their unhappy experience to friends and business associates, who might spread the story around even further. Thus are hotel reputations lost. Hampton Inn decided to take advantage of this informal communication chain with its new policy. The company believes that guests who go away impressed with the way that Hampton Inn handled a problem will spread the word and generate additional business for the chain. The guarantee is simple: Guests who are not completely satisfied with every aspect of their stay are not expected to pay. This guarantee allows every Hampton Inn employee to do whatever it takes to satisfy guests- including giving them their money back. Rhonda Thompson, one of Hampton Inn's employees, describes the 100% Satisfaction Guarantee policy in terms of its supporting HR strategies: While working as a guest services representative at a Hampton Inn hotel, I overheard a guest at our complimentary continental breakfast complaining quite loudly that his favorite cereal was not available. Rather than dismiss the person as just another disgruntled guest, I looked at the situation and saw an opportunity to make this guest happy. I gave him his money back- not for the continental breakfast, but for the cost

of one night's stay at our hotel. And I did it on the spot, without checking with my supervisor or the general manager of the hotel, and without making the guest fill out a log complaint form. Some people might be surprised to hear this story, or they might not believe it could happen. After all, how could a front desk employee give a guest his money back without getting permission from the boss? And why would the hotel support this action for something simple like a bowl of cereal? Before the 100% Satisfaction Guarantee was introduced, my job was like most other jobs in the hotel industry. My responsibilities were outlined in my job description, and I was evaluated on how well I fulfilled those duties. There wasn't much room to express my own ideas, and I wasn't really expected to come up with any. Most people I worked with liked it this way because they knew what their jobs entailed and what to expect. When the 100% Satisfaction Guarantee policy was first announced, many employees thought this program would have very little effect on their jobs. But when we learned that every employee would go through a three-day training program, we knew that the guarantee was something special. It became more and more apparent that the new Hampton Inn guarantee would affect all of our jobs, and we would have to change the way we thought about performing our routine duties. The company scheduled a series of training sessions at every hotel, involving videos, classroom-style teaching, open discussions, and role playing. Through this training, we learned what to do if a guest asks to invoke the guarantee. We also learned to identify situations when we, as employees, should invoke the guarantee for guests before they even complain. The training reinforced the message that employees at every

level should use this responsibility to make sure guests are satisfied. Many employees -including myself- were skeptical at first. Although we were proud of our hotels and the service we offered, we thought that guests might take advantage of the guarantee as a way to get something for free. But the training emphasized that, although any reason given by a guest is a valid reason to invoke the guarantee, most guests would not take advantage of us. Hampton Inn basically threw out its old job descriptions. Of course, a housekeeper's duties still include cleaning and preparing guest rooms. But the housekeeper's real job is to satisfy guests and this typically is accomplished by cleaning the room to perfection. For example, if a housekeeper sees a guest having a problem with the lock on her room door, the housekeeper has the authority to stop what he or she is doing and take whatever action is necessary to correct the situation. While the goal of the 100% Satisfaction Guarantee is to give every guest a satisfying stay, the guarantee has made employees' jobs more satisfying as well. When Hampton Inn tells employees that they can do whatever it takes to make a guest happy -without needing approval from a manager- they're telling employees that they trust them to do their jobs. Most employees have never worked for a company that will unconditionally back them up for refunding a guest's money, no matter how small the problem was to begin with. This type of trust motivates employees to do a better job, and makes them try harder to deliver excellent customer service. Employees know that they don't have to wait for their once-ayear review to find out if they're doing a good job; they find out every day from guests staying at the hotel. Questions 1. How would you describe the new HR strategy adopted by Hampton Inn? How does it compare with Hampton's previous HR strategy?

2. Distinguish between Hampton's HR strategy and the HR program used to implement it. Is the HR program Hampton Chose an effective mechanism for implementing its HR strategy? 3. Does Hampton's new HR strategy fit with the hotel's business strategy? Explain. 4. How does Hampton's new HR strategy allow the hotel to deal with environmental threats more effectively? 5. What risks may Hampton Inn incur by adopting its new HR strategy? Explain. Cooperative Learning Exercises Students form groups of five and role-play the following situation: A major stockholder has complained that Hampton Inn's new HR strategy will lead to higher costs. According to this stockholder, customers will take advantage of the employees, who will be unable to protect the hotel's interests. This stockholder is calling for tighter controls to prevent abuses of the 100% Satisfaction Guarantee. Hampton's CEO has called a meeting in response to the stockholder's complaint. The meeting is attended by the complaining stockholder, two workers (who will provide the employee perspective of the situation), and the HR director (who will discuss the business rationale for the new HR strategy). Each of these parties presents its view of the situation to the CEO, who then makes a decision concerning the new HR strategy based on the arguments advanced in the meeting. Source: Reprinted by permission of the publisher, from HRFocus, July 1993