Colleges of Applied Science

SSH Swiss School of Hotel and Tourism Management

Strategic Human Resource Management

B3106

Student number

09006349

Date: October 30, 2009

Introduction 1

Strategic Human Resource Management 1

Empowerment 2

Commitment 3

Leadership 4

Training Mentoring Coaching 4

Reward and Performance Management 5

Conclusion 6

Reference 6

Word count 2160

Strategic Human Resource Management

Karen Legge (1995 cited in Armstrong 2006) defines the role of human resource (HR) in
the dynamic environment of hospitality industry in the following statement:

“Human resources are valuable asset and a source of competitive advantage”

However, Jim Collins (cited in Wirtz et al 2008) changed slightly and approves that:

“The right people are your most important asset”

And we believe that “the wrong people are liability”. It is very important for an organization
to find out the best approach to use their resource effectively and efficiently as the
definition is written following

“Human resource management is defined as a strategic and coherent approach to

the management of an organization’s most valued assets – the people working
there who individually and collectively contribute to the achievement of its
objectives” (Armstrong 2006).

Let’s take an example of Singapore Airlines (SIA) which is well – known for its service
excellence. Singapore Airlines has identified the significant role of human resource for
strategic management in the competitive world with other budget airlines to reach their
customers. They believe that:

“Human assets are crucially important to service firms due to the inherent
characteristics of the service industry, and HR management practices and the
resulting quality of human resource are difficult for competitors to imitate. Service
is the core part of the product and front – line staff tends to be the most visible
element to consumers, hence significantly influencing service quality” (Wirtz et al
2008).

SIA “adopts a high rigorous and strict selection process” that includes three rounds of
interview, uniform checks, a water confidence test, and even a tea party which help
management to observe applicant style and behavior (Wirtz et al 2008). The importance
of HRM strategy is drawn clearly under the following statement of Senior Manager, Ms
Lam Seet Mui for HR development:
 “SIA invests huge amount of money in infrastructure and technology, but,
ultimately, you need people to drive it. At SIA, we believe that people actually do
make a difference, so the company has in place a very comprehensive and holistic
approach to developing our HR”.

It depends on management from process of recruitment and selection, for instance, Ritz –
Carlton did not “hire” employees, it “selected“them:

“The right person for the right position” comes first from high performance
management how to recognize and utilize employee’s ability and knowledge as
contribution to organizational success and as constituting a significant source of
competitive advantage” (Armstrong and Baron, 2002).

In order to utilize the most of valuable human capital, HR practices should be based on
strategic policies which satisfy the needs and wants of well – qualified employees but still
to focus on organization’s goals. Walton (1985, cited in Armstrong 2006) follows:

“The new HRM model is composed of policies that promote mutuality…policies of

mutuality will elicit commitment which in turn will yield both better economic
performance and greater human development”.

An ideal organizational culture is where managers can gain “the hearts and minds” of
employees through development of communication and different approaches to for a high
trust environment. It depends on the nature of business but it is suggested to apply
pluralistic approach.

As Storey (1989, cited in Armstrong 2006 p.9) described, using the soft approach is to
“treat people….through their commitment, adaptability and high quality of skills,
performance and so on “, it create a harmonious environment for “integration between
corporate goals and employee values, belief and behaviors” (Marching ton and Wilkinson,
1996:89, cited in Leopold 1995, p.41). From different perspective, people are interested in
different things but different interests have to be considered within control of management.
However, managers have to be able to adjust their role in different situations; they have to
use the “hard approach” to make decision for the common goals of organization.

A question remains if employee is engaged only to the job but not committed to
organization. It means employees are participated in organization, involved in decision
making and feeling of belonging to the company. Philosophy of “the Spirit to Serve” is
extremely successful with strong teamwork among employees and supportive
management that made Marriott hotels in the UK to 14th place in 2008 on Sunday Times
list of the top 20 big companies for people to work for (Pollitt D. 2008).

Employee engagement and organizational commitment are two important concepts that
affecting work performance and the attraction and retention of employees. However, not
all the service sector companies are aware of the importance to create an attractive
atmosphere to retention people. if an employee just goes to work to “get the job done” for
many reasons such as money and not totally interested at all in organization’s goal, it
causes a consequence of no more effort into work. This situation is a danger to
employee’s retention because people are not particularly interested in the organization
except as there are opportunity to carry out the work that is provided for their own
attention. However, it can be sometimes that employees are fully committed to the
organization but they don’t like what they are doing, so people also are discouraged for
extra mile on the job. An issue that has an impact on employee’s engagement is the
rational aspect. It is crucial to know how to fit the integration of individual needs into
vertical integration, horizontal integration and HRM integration. HR managers are aware
of different aspect of performance management strategies that will be discussed clearly
later, especially organization development to help employees in developing their abilities
and for company’s aim.

HR managers are responsible for common goals of employees linking with strategy and
plan within business context. The process should be transferred from corporate level to
the functional or business unit level and down to the teams and individual level. However,
it can be a bottom – up process that gives team opportunity to have their own goals but to
gain for organizational purposes. But communication can’t be failed between managers
and employees for responsibility and mutual expectation (Armstrong, 2006). As
commitment strategy from Walton (1985, cited in Armstrong 2006) suggests that “workers
respond best – and most creatively…when they are given broader responsibilities”. More
responsible employees are for their work; more committed they are to organization.

From emotional aspect, leadership style plays an important role in encouraging people by
different strategies. Transformational leaders that are able to motivate people to strive for
higher level goals, differentiated from transactional leaders. Employees can be motivated
by a compliment or support for further training that increase value for their position, also
for the company. For example, employees can be sent for cross training for multi – skilled
programs that are helpful for functional flexibility of employee.
 “Excitement in the job can be created by the quality of leadership and willingness
of managers and team leaders to recognize that they will obtain increased
motivation and commitment...”Armstrong (2005).

Charismatic managers can get attention from people because of their personality and
inspirational qualities and their aura. Both of them are significant for characteristics
needed as a leader. Leadership is vital in a multi – national working environment that
make managers must be able to handle with many different cultures. According to
Brewster et al (2002), the effectiveness of global HRM depends on “the ability to judge to
the extent to which an organization should implement similar practices across the world
(convergence) or adapt them to suit local condition (divergence)”.

Line managers make sure that staffs have a clear concept of their authority empowerment
within limitation. For example, the usual baggage allowance is 20kg but front line staffs in
SIA are empowered to raise it to 25 or 50kg if they feel that it is right and justifiable.
Leaders (are different from managers) who can only convince their employees by their
inspirational qualities, knowledge and encouraging people involved in the job. The role of
the leaders will shape the work group, responsibilities and behaviors and it also influences
on the way of working style of team members. At SIA, it is believed that team working is
another critical factor to build high performance to deliver service excellence. The 6,600
crew members are formed into teams of 13 individuals where team members are planned
to fly to together as much as possible (Wirtz et al 2008). This opportunity allows them to
better understand each other, personalities and capabilities. SIA enables “team leader” to
know staff’s weakness and strengths that are recorded for further information of deeper
training as well as promotion. Team working is necessary for all types of business,
especially for hospitality industry. A working atmosphere where people mutually
understand is healthy for high productivity and simulative to attempt for achievement.

Training is an important part of increasing employee’s commitment to organization like

the motto of SIA: “If SIA can’t do it for you, no other airline can” (Wirtz 2008). Former CEO
Dr Cheong (cited in Wirtz 2008) also commented that: “To the company, training is forever
and no one is too young to be trained, nor too old”. Training, therefore, is for everyone to
develop their skills and knowledge to maximize of their capacity. Coaching and mentoring
are other approaches of training. While coaching is described as “an informal approach of
using work experience to train and develop individual development” (Armstrong, 2005),
mentoring is where one person with greater experience passes on knowledge to another
through a relationship of mutual influence, learning and trust, usually by a manager.
These two approaches are in the transmission of knowledge between individuals and
groups to gain more information within business. For instance, in SIA, the role of mentors
and coaches to guide new employees rather than just being superiors. SIA training
programs (70% is in – house) develop 9,000 people a year in skills or self – development
such as social etiquette or counseling. For management training, SIA uses a job rotation
method for managers to develop deeper knowledge of operations at variety of areas that
increases mutual understanding, reduces conflict and innovation.

Therefore, HR managers should be aware of employee’s skills. Managers have to know

employee’s strengths and weakness so they can provide multi – skilled programs or
specific ones for specific employees. But it is not easy to prove that opportunity is divided
fairly to people because there is still a matter of treating people differently. In some cases,
there are certain of employees or senior managers who get chance for further
development. In another situation, employees are not supported for learning because they
still have to accomplish their task and have no interest for extra time. In the end,
managers have to evaluate the outcome of training.

As Ms Glady Chia (cited in Wirtz 2008) comments, SIA always reviews all the feedback
from customers and finds out the main reason and make sure it doesn’t happen again. In
order to ensure high quality in our service sector, quality circle is “a valuable device for
capturing employee experience and gaining suggestions about changes in customer
service needs has been identified” (Barbee and Bott, 1991). From example of Marriot
hotels, employees are empowered by receiving rewards through system of customer’s
testimonials to evaluate their personal performance. However, this idea is a supportive
tool if only line and superior managers are interested and provide adequate training to
member of quality circle group.

As a result, reward recognition is competitive strategy for achievement of high standards

of customer service which seems to be intangible in perception of guests. In Switzerland,
employees are paid for 13 month salary that can be a motivation. Payment related
performance is another strategic approach that HR can align into motivation practice. But
they should concern of fair system that motive people positively. Some employees may
think managers can use only financial benefits to do everything. In fact, what employees
are interested is more meaningful if managers try to communicate and listen to their
employees. SIA argues that “the recognition you give need not necessary be money”. At
SIA, managers want to build a very proud tradition for long term strategy like “good
ceremonies, photographs and write – ups in the newsletters can be more motivating than
mere financial rewards” (Wirtz 2008).

They look for the long term dedication and commitment for the value of human capital.
From another perspective, employees need also try to gain best outcomes since they are
the valuable asset to compete with other firms. Furthermore, training and development
should be also provided as opportunity to maximize human capital. It is important to
“satisfy” people within limitation and to enhance and develop employee’s capacity. And
leaders have to be capable of combining hard and soft approach to inspire their
employees to achieve best outcomes:

“To compete with the best, we need to ensure that...people, the industry’s most
important resource, perform to the best of their ability” (Department of National
Heritage, 1996 cited in Mountino 2000) “.

In practice, the most important asset as human capital is still an issue to answer whether
organizations utilize a matching long – term strategy of human resource management.
Reference

Bevan et al (1997). In: Armstrong M (2009), Handbook of Human Resource Management

Practice, 11th Edition. Chapter 20.

Collin J. in: Wirtz J., Heracleous.L, Pangarkar.N.2008. Managing human resources for
service excellence and cost effectiveness at Singapore Airlines, Managing Service Quality
[online], Vol.18 No1. Available from www.emeraldsight.com/0960-4529.htm [Accessed in
Sept 20 2009]

Department of National Heritage. 1996. In: Mountino. 2000. Strategic Management in

Tourism. UK: CABI publishing. Chapter 6; pp.169.

Karen Legge (1995). In: Armstrong M. (2006). Strategic Human Resource Management: A
guide to Action. London, GBR: Kogan Page, Limited, pp.11 [online]. Available from
http://site.ebrary.com/lib/qmuc/Doc?id=10120249&ppg=21 [Accessed in Sept 15 2009]

Marchington and Wilkinson, 1996:89. In: Leopold J, Harris L., Watson T. 1995. Strategic
human resourcing: Principles, Perspectives and Practices. Prentice Hall Financial Times,
pp.41

Pollitt D. 2008, Marriott Hotels stress the Spirit to Serve. Human Resource Management
International Digest, Vol. 18 No5, pp 26-28.