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Chapter 3: Planning: jobs and people

Case studies and exercises

Case 3.1: HR Planning at the City Hotel

Case 3.1: HR Planning at the City Hotel

The following case study is the worked example referred to in Chapter 3. Here, specific activities are suggested, together with some further activities which involve students relecting on planning and related issues in their own organisations. It might be possible to ask students to undertake these activities ahead of a teaching session, to give the material a practical context.
HR Planning at the City Hotel The City Hotel is located in the middle of a medium-sized city. It caters mainly for business trade during the week and for holiday trade during the weekends and in the summer. In the summer and at weekends there is, therefore, a greater demand for catering and waiting staff as there is a greater demand for lunches. During the same periods there is a lesser demand for housekeeping staff as the customers are mostly longer-stay. The hotel has been gradually improved and refurbished over the past five years, and trade, although reasonably good to begin with, has also gradually improved over the period. There are plans to open an extension with a further twenty bedrooms next year. Note 1 There has been a particular problem in recruiting kitchen assistants, waiting and bar staff. This is partly due to local competition, but also to the fact that early starting and late finishing times make travel very difficult. Often there are no buses at these times and taxis are the only available transport. One or two hotels in the area have begun a hotel transport system, and the City Hotel management have decided to investigate this idea in order to attract a higher number of better quality applicants. A second problem has been identified as the lack of availability of chefs and receptionists of the required level of skill. It is felt that the local colleges are not producing potential staff with sufficient skills, and therefore the management of the City Hotel have decided to consider: 1. 2. 3. Note 2 Having mapped the environment, the hotel management looked at the demands and responses for each priority area. For customers the beginnings of the list are shown in Table 3.1. Table 3.1 Demands and responses for the customer factor -----------------------------------------------------------------------------------------------------------Customer demands Responses -----------------------------------------------------------------------------------------------------------Polite staff Our staff pride themselves on being courteous A training scheme, either run internally or in conjunction with other hotels. Better wages to attract the better trained staff from other employers. Investigation of other localities and the possibility of providing more staff.

Staff understand that we are busy

Sometimes we need facilities we have not arranged in advance And so on. -----------------------------------------------------------------------------------------------------------Note 3 The management of the City Hotel decided that one of their key objectives over the next three years was to become known for excellence in customer service. This was seen as a key tool to compete with adjacent hotels. Managers used brainstorming to identify the staff behaviours that they wanted to see in place, and summarised their ideas in the format in Table 3.2.

We will make procedures quick and simple, people and staff will respond to needs immediately We will be flexible and enthusiastic in our response

Table 3.2 Behavioural expectations chart: organisation goal excellence in customer service -----------------------------------------------------------------------------------------------------------Behaviours needed How to create or reinforce -----------------------------------------------------------------------------------------------------------Address customers by name A customer service training course to be developed Smile at customer A group incentive bonus to be paid on basis of customer feedback. Customer service meetings to be held in company time once per week Respond to requests, e.g. room change in positive manner Ask customers if everything is to their satisfaction Answer calls from rooms within four rings And so on. -----------------------------------------------------------------------------------------------------------In addition to this a suggestion scheme was instigated to collect ideas for improvement in customer service. A payment of 50 to be made for each successful suggestion. Note 4 The City Hotel management has plans to open a further twenty bedrooms in a new extension during the coming year. On the basis of this simple model the additional staff required could be worked out as follows:

Fifty-five bedrooms requires 60 staff.

The ratio of staff to bedrooms is therefore 1.09 staff per bedroom.

If the same relationship were maintained (i.e. without any economies of scale) the additional number of staff needed would be: 20 bedrooms

1.09 staff = 21.8 extra staff needed. Thus total staff needed would = 81.2 full-time equivalent staff.

Note 5 The managerial staff at the City Hotel exercised judgements on the following human resource planning matters: 1. Management considered the probable reasons for the relationship between people demand and time. It was felt that this was most probably due to the gradual improvement in the hotel over the last five years. Since this improvement had virtually reached its potential it was felt that the relationship between employee demand and time would change. Judgements had to be made on whether the occupancy of the new wing would immediately justify all the additional staff to be appointed. The management considered that since the weather had been very poor in the preceding summer, the bookings for the following summer period might be slightly down on the last year and this shortfall might not be made up by increasing business trade. Judgements were made as to whether staff could be better utilised, with the effect that the additional numbers of staff projected might not be so great.

2. 3.

4.

Note 6 The managers of the City Hotel decided to encourage greater staff flexibility and interchangeability. This interchangeability would be particularly useful between waiting duties and chamber duties. At the present time waiting duties are greatest at the weekend and least during weekdays, whereas chamber duties are the other way around. The effect of this is that waiting staff and chamber staff both have a number of hours of enforced idle time, and the feeling was that there was some overstaffing. By securing flexibility from staff (by paying a flexibility bonus) it was felt that the smooth running and efficiency of the hotel would be considerably increased. It was calculated that the nine chamber posts and eight waiting posts could be covered by sixteen combined posts (all FTEs). Note 7 Managers of the City Hotel assessed the levels of customer service at present by collecting questionnaire data from both staff and customers and conducting a series of interviews with staff. They also asked in what areas service could be improved and asked staff how this might be achieved. As well as specific targets for improvement, they found many examples of systems and organisation that did not help staff give the best customer service. Staff understood that getting the paperwork right was more important than service to the customer in checking out and in. The paperwork systems were over-complex and could be simplified. Also, shift-change times were found to correspond with busy checkout times. Plans were developed to improve systems, organisation and communication. Note 8 The statistical analysis of staff (Table 5.3) was aimed at occupation, age and full-time equivalent posts. This analysis was used primarily for three main purposes: 1. Full-time equivalents needed to be worked out so that this figure could be used in other manpower planning calculations.

2. 3. Note 9

To consider the occupational balance of staff and to give information which would be useful from the point of view of staff interchangeability. To plan for future retirements and, in consequence, look at recruitment plans and promotion plans.

At the City Hotel eighteen staff had left during the preceding year. The annual labour turnover index was therefore worked out to be:

(*The average number of staff employed over the year is different from the maximum number of staff that have been employed and were desired to be employed.) Note 10 At the City Hotel, of the eighteen staff that had been recruited over the year, three had been replacements for the same kitchen assistants job, and two had been replacements for another kitchen assistants job. The stability index was therefore worked out as:

(*At exactly one year before there were only 69 of the desired 72 staff in post.) Note 11 A histogram (Figure 5.1) was plotted of leavers over the past year from the City Hotel. It shows how the majority of leavers had shorter lengths of service, with periods of employment of less than six months being most common. Figure 3.1A histogram of the lengths of service of eighteen employees leaving the City Hotel in the previous year Note 12 Analysis of the age distribution (Table 5.3) indicates that there may be some difficulties with promotions. In particular, a problem was identified for management promotions. There are four general managers, the youngest being 21. In the past such a junior manager would have been promoted after two years service, which they had just completed. The ages of the other managers indicate that there will be no retirements in the immediate future and management staff turnover has, in the past few years, been low. In view of this it was thought likely that the junior manager would leave shortly. This was not desired since they were particularly able, so ways of dealing with this promotion block were considered, such as creating a new post, which might retain the junior managers services until a promotion became available.

Table 3.3 Staff by occupation, number and age

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There are no direct activities relating to this worked example, however there are some associated activities: Case study activity: Break the students into small groups to begin to prepare a human resource plan based on the information in the City Hotel case study. It is essential that students have pre-read the case and are very familiar with its contents. Ask groups to specifically design, for the City Hotel, the following in outline: * * * * * * * * * supply plan, organisation and structure plan employee utilisation plan training and development plan, performance plan, appraisal plan, reward plan, employee relations plan communications plan

Although a number of clues are given in the case study as to activities that can be included in the plan, there has been no attempt to make these complete, to integrate them or to consider the knock on effects of one plan on another. The task for the groups is to propose an integrated set of outline plans for the year ahead with an assessment of the financial and other implications supported by a sound rationale. Specifically stress that each of these plans must not conflict with any of the others and that they should be mutually supportive. Students should be able to describe their plan in about 50 words for each area, as the emphasis is not on the detail but on integration and implications. Allow plenty of time for groups to discuss, as this is a demanding task. Report back could be in either of two forms: Option 1

Give each group the opportunity to present their plan to the whole group and allow for time to question and compare different approaches to the same issues. (The groups may have decided to meet in the meantime to do further work). This timing will be more appropriate to part-time students already employed in the personnel function. For full time students you may wish to delay presentation until towards the end of the course, and use this as a framework for their ongoing interpretation and application of each session. Option 2 The case could be used as an individual or group assignment to be presented in written form.

Further activities: 1. Work out the annual labour turnover index and stability index for your organisation as a whole. If it is feasible, carry out the same analyses by staff group. Attempt to explain your results. Compare your results with those from another organisation and attempt to explain the differences and similarities. Does action need to be taken, if so what? 2. Analyse the age distribution of either all staff in your organisation or staff at a specific level or in a specific function, depending on what is feasible and useful. Attempt to explain the picture that you find and identify the implications of your findings. Does action need to be taken, if so what? Compare this with another organisation if possible.

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