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Strategic Contributions of Human Resource Management to Business Success: Analytical Essay

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Unlike other sectors, Tourism and hospitality is dependent on the direct contact of humans with their clients. Therefore, there has to be dynamic ways of making the employee-customer experience a successful one (Kusluvan, et al., 2010). Available facts show that Tourism and hospitality is plagued with recruitment issues, high staff turnover, and challenges in attraction and retention of skilful employees, which all culminate in poor service delivery and very low business growth. Bratton and Gold (2012) believe that human resource management (HRM) can help an organization to improve their business growth by effective staff management, which should focus on understanding employee needs and aspirations.

Ahmad and Scott (2014) identified that HRM’s ‘hard approach’ to people management, with its attendant rigidity and mechanistic procedures, has continued to breed dissatisfaction among the workforce, and therefore result in constant moving by the staff to other brands. On the other hand, Aslam, et al. (2013) emphasized that a compassionate administrative approach in managing people will enhance the confidence of the workforce and inspire them to work with passion and zeal, and, if combined with intensive training and development prospects, it can increase their competency in attending to customers, which will foster a lasting business success (Armstrong, 2017).

The Particularly Different Nature of the T&H Industry and the Harder-To-Manage Human Resources

The Tourism and hospitality industry is accepted globally as the highest employer of labor, which obviously transcends to highest revenue generator to the economy. According to Baum, et al. (2016), this trend is expected to increase due to increase in travels, changing customer taste, high demand for comfortable accommodation, an increase in holidaying, and naturally crave for relaxation after hard work, eating and drinking. The peculiar nature of tourism and hospitality is in the scale of the industry and the fact that the sector cuts across every country, culture and ethnicity, and in the words of Michael et al. (2011), notwithstanding the global economic predicaments, the sector is still predicted to rise. Because customer contentment and devotion depend on service delivery, and for service delivery to be effective, the human resources inside the enterprise is indispensable.

Mohan & Arumugam (2016), in their appraisal of the challenges in the HRM of T&H industry, submitted that the sector has many workforce difficulties, which include very low remunerations, skill scarcities, and unfriendly working hours, shift arrangements not family-friendly. According to them, other issues show that women and ethnic minorities are employed in low-paid, low job positions, with well-paid, high position jobs levels occupied by men and selected ethnic groups, and this shows immaturity and unequal opportunities in the policies of the industry. Further problems are undeveloped or absence of career development programs and overreliance on casual seasonal workforce and contract staff, use of unofficial employment procedures, No substantial or good HRM practices, No presence of trade unions, High-level employee turnover and inability to recruit and retain workers.

Acknowledging this truth of poor staff welfare practices, Usha (2013) argues that financial gains is the major determinant for HRM strategies and operations in tourism & hospitality. This can be said to be true of any business, but it is over-emphasized in tourism and hospitality and conveys a specific significance due to the peculiarity of the sector. Poor people management results in a continuous rise in the staff turnover, and that is why Burke, et al. (2013) believe that most of the existing workforce in T&H are not satisfied with their current work environment because ineffective management of the workforce have a tendency to escalate the cost of doing business, and consequently breeds dissatisfaction among workers. Which makes them to leave their workplace.

Ahmad, et al. (2010) in their research, have revealed that the T&H sector has only a comparatively few number conventional HRM academies, but other industries have enough for their staff development.

All these underscore the lack of commitment on the side of the employers when it comes to staff welfare and development. Employees are in constant search for greener pastures, and if a company does not give them enough reason to stay, they will continue to move.

Methods that Are Helping to Resolve the Difficult Characteristics of the T&H Industry

Strategize structural change as a policy to promote quality, efficiency, staff motivation, and contentment

In the study by Taylor (2010), he recommended that a strategy should be in place to address the identified challenges of tourism and hospitality faced by the HRM in the sector. In the work, he stressed the need for structural change, promotion of talent and quality, efficient use of staff and engaging the workers in ways that boost their morale. The book also touched the areas of making concrete policies that are people-oriented and proper monitoring to ensure that the policies are implemented and in the correct order and measure. He emphasized transparency and meritocracy in the policy of rewards and staff motivations and pinpointed that these two will foster employee engagement, hope and expectations in practical terms.

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Develop effective training packages

According to the report of the United Nations Economic Commission for Europe (2013) on human resource management and workforce training, they proposed the formulation of a nascent and constant training of the latest expert knowledge as the most important assets of the industry. In this regard, a new development policy and its representative institutions is apt to project the communication of hospitality skills and culture. The new training strategy will:

  • Arrange training in an integrated scheme;
  • Position career development on the limelight rather than compulsory and managerial training progressions;
  • Concentrate training on the real work done in service that highlights hands-on skills to complement theories;
  • Maintain prevalent priorities;

Formulate Welfare schemes and assess the standards

A liberal worker welfare program is an excellent method to keep workers motivated and attract quality talent. This is in the findings of Tofail & Kaida (2015), and stated that designing welfare packages should be articulated beyond physical prizes like money and nonphysical schemes like mentoring by employers. This in effect will deeply change workers’ attitudes to both business owners and customers. They enumerated the package to bonuses, income allotment, health, accident at work, life assurance, paid holidays, free food, company vehicle, equity sharing, childcare trust, gratuity, sick permissions, additional time-off and end-service/pension plans.

Another piece of literature by Hayley (2016) attempted to reflect on the major attributes of a good benefits package and made points that support the ones above: utilizing cloud computing and artificial intelligence for knowledge transfer and taking advantage of emerging technologies to create of skills pool where talents can be captured. See summary in theme below: (du Plessis, et al., 2016)

Strategic Contributions of Human Resource Management to Business Success in Tourism and Hospitality

Juan, et al. (2017) delivered a review of the strategic HRM literature from general management points of view and tourism and hospitality-specific angles. He explained that establishments in T&H business witness a difficult and competitive situation, where HRM handles critical roles in business successes and existence. What makes the industry peculiar is that the merchandises of organizations in the sector are service-oriented, and that means the core competencies are intangible and extremely dependent on human-to-human exchanges between personnel and clients. He stressed that human capitals play a major role in service excellence, client devotion, customer satisfaction and similar other key performance index used to measure company performance (Baum, 2015)

In a notably and exceptionally in-depth investigation, Tracey (2014) exposed five roles of HRM as tactical HRM planning, recruitment, coaching, performance evaluation & reward and welfare. Even though the study by Tracey (2014) did not specifically contain a part on strategic HR management, it does, however, mention that Strategic HRM is the bridge between what human resources does at the operational level (such as hiring, development, benefit, and reward) and business success.

Huselid and Becker (2010) explained that over 300 published articles on Strategic HRM that concentrated on the link between a company’s HRM structures and company’s performance point to the substantial influence a diligent human resource have on business success. The two authors conclude that there is company’s performance enhancement when:

  • staffing and selection methods,
  • reinforcement schemes; and
  • coaching and career advancement policies are attuned to the company vision.

Wright and McMahan (2011) explored the current drift of HRM away from the human content of the human resource management, tries to call the attention of industry players to have a reflection and put back the human in the human resource management. He emphasized that the relationship between HRM and organizations is for human assets with inherent know-how, talents and aptitudes at both personal and general company levels. Madera (2013) agrees with these assertions and reiterated that company-specific personnel resources is connected with company performance, attractiveness, and competencies. These researches suggest that HRM functions advance human resources in ways that rightly stimulate performance outputs and business success.

Tavitiyaman, et al. (2011) identified another strategic contribution of the HRM on the area of social resources and emphasized that social capital is a major noticeable performance-inducing relationship exhibited by HRM. Motivation plans, input evaluations, and development lead to the growth of community networks, which consequently increase business success.

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Strategic Contributions of Human Resource Management to Business Success: Analytical Essay. (2022, July 14). Edubirdie. Retrieved November 27, 2022, from
“Strategic Contributions of Human Resource Management to Business Success: Analytical Essay.” Edubirdie, 14 Jul. 2022,
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