Learning partners are invited to read and understand the given case study and address following question with 3000 word documentation.
Simplified Version – After chat with lecturer
1.Evaluate the current performance system at Hilton China (Word 300) – 10 marks
2.What will you do as a manager in taking some leadership initiatives to change this (Word 300) – 10 marks
3.Look at similar Performance management system in the hotel industry and look for the employee well-being aspects in other hotels in the industry (Word 1300) – 40 marks
4.Propose a new performance management system for Hilton China (Word 1000) – 30 marks
This report aims to provide a potential proposal for a new performance management system for Hilton Hotel, China. The hotel industry in China's demographic location is considered one of the major industries because it contributes to a larger part of its economy. For this purpose, it becomes significantly essential for the giant group of hotels; likewise, Hilton considers the potential of employee performance systems for effective output and service-oriented development for the visitors (Maria, Thecla, Chukwu and Ifenyinwa, 2018). Thus, this report will significantly echo the current employee performance system of Hilton, China, and discuss the relevance and overview of the performance management system in China's hotel industry.
Current Employee Performance System – Hilton, China
Hilton Hotel Corp. is considered one of the largest hotel franchisors worldwide, as it serves a total of 290,000 rooms globally. The hotel is also listed amongst the top 300 hotel corporations around the world. Hilton is thus found to be operating five hotels in China's demographic region, namely Hilton Beijing, Hilton Chongqing, Hilton Dalian, Hilton Nanjing, and Hilton Shanghai (Chen et al., 2011). With that said, it is essential to consider the employee management system's potential to increase customer satisfaction as pros for the Hilton group. Also, as it is one of the top-notch hotels worldwide, Hilton Corp thrives hard to improve some of its areas, such as sales, stock value, and the hotels' overall effectiveness. Thus, it could be possibly not argued that Hilton Hotels has proved its worth as the fastest-growing hotel industry organization. The current employee performance system has also contributed to making the Hilton Corp a massive success in China.
It has been found that Hilton includes some broad areas under its employee performance system as its pros. These include the organization's value, the active participation of the organization's employees and staff, and an effective working environment (Chen et al., 2011). With that said, it has also been found that Hilton's current employee performance system is basically a traditional approach towards various components such as inspectors, performance-oriented assessments, PMS (performance management system) for the system design, career development, and the on-time feedback, which is perhaps counted as cons (Durasevic and Kavaric, 2017) (see exhibit 1). It has also been found that the current employee performance system facilitates the development of strategic goals by focusing on the major areas, which certainly requires some key aspects and objectives to be oriented in the first place. Secondly, leadership and teamwork have also given vital importance in the designation of employee performance and management. For this purpose, Hilton is found to be acknowledging the potential of open-communication portals for its employees and the organization's leaders.
Introduction of the Leadership Initiatives as a Manager of Hilton, China
Considering the current performance system at Hilton China, it requires certain changes in terms of employee management. The employee management system can be defined as creating and maintaining an effective working environment in the organization. In this regard, people of an organization are considered vital resources that contribute to a larger part of the growth and development of an organization in the hotel industry (Ashdown, 2018). Hilton China is found to be acknowledging the communication factor more precisely instead of focusing on improving the aspects associated with employee training and development. As a Hilton Hotel manager, China, it is suggested to the organization to consider the potential of performance and development cycle for effective employee management. This cycle includes five major aspects, namely goal planning and development, performance and feedback systems, review system, and performance evaluation of the organization's employees.
The goal planning and development will include the segmentation of the specific objectives required to be imposed in employee management and development. In this regard, defining a role will become significantly essential for Hilton China. For this purpose, acknowledging the potential of a competency model is suggested for the organization as a manager. Simultaneously, as a manager, acknowledging the potential of performance management and feedback also plays an essential role (Cooper, Ezzamel and Robson, 2019). This will include leadership initiatives such as establishing an open-panel under which the review system and performance evaluation of the employees will be done. This could also be done by introducing mindfulness, resilience, and stress management in the organization. Additionally, the introduction of two major concepts should also be established within Hilton, China's organizational culture. These will include talent management and knowledge management (Chen et al., 2011). All this will help Hilton China establish an effective employee performance system in their organization.
Performance Management System in the Hotel Industry
The PMS (Performance Management System) is considered a process that helps the HRM division of an organization link the individual objectives with the organization's respective goals and vision. The recent development in the hotel industry's performance management system is found to be acknowledging the potential of modern scientific tools for differentiating some key operating areas of an organization. These include talent management, objectives and decision management, and constant monitoring and review systems (Wu and Lu, 2012). The process of PMS helps the human resource management of a hotel to integrate the individual objectives of the organization with various departmental divisions. This results in the growth and development of both the employees and the business of the hotel. The key aspect of a hotel giant like Hilton is to provide a handsome and extraordinary experience to the visitors staying in their hotel and procuring their services. For this purpose, the major roles are significantly played by the organization's employees who facilitate the deliverables' effective working and productivity (Tari, Claver-Cortés, Pereira-Moliner and Molina-Azorín, 2010). PMS aims to implement a more robust and extensive process of managing employees to help the organization achieve success for both the organization and its human resources.
The hotel industry in China has witnessed a sudden spike in recent years. Since the tourism industry has impacted due to the global pandemic, COVID-19, many hotelier groups in China have also faced replications. These included hotel giants such as Marriot and Hyatt. Such hotelier groups are distinguishing their employee well-being aspects more comprehensively (Chen et al., 2011). Marriott has found to be establishing a traditional approach with integrating the technological aspects into it. The traditional performance management systems regarding employee well-being are based on the organization's cost efficiency (Alonso-Almeida, Rodríguez-Antón and Rubio-Andrada, 2012). Thus, Marriott's PMS system is more likely found to be profit-oriented, for which the organization is focusing more on the trade-off performances. Since the impact of COVID-19 is astonishing on China's hotel industry, hotel giants like Hilton and Marriott have started caring about their core values and prepositions (Hoque, Shikha, Hasant, Arif and Hamid, 2020). Thus, the performance management system of Marriot is found to be aiming more towards evaluating the key performance indicators of their employees more comprehensively. The evaluation process becomes significantly essential for the hotels to figure out areas where work must be done from the management's side. For this purpose, the PMS systems help the hotels in establishing required strategic approaches in their organizational cultures.
On the other hand, hotel giants like Hyatt Regency have acknowledged the potential of innovative performance measurement systems in their organizations for employee well-being. Such a performance management system is value-based rather than cost or efficiency-based (He, Niu, Sun and Li, 2020). Under such PMS systems, improvement monitoring is acknowledged more comprehensively. Hyatt Regency employees are found to be engaged with lower retention rates and give importance to the training and orientation given by the organization. These orientations and performance training help the employees of an organization focus more on performance capability than on profitability (Chen et al., 2011). No doubt, the impact of COVID-19 has enabled businesses on the demographic location of China to strike a sudden impact due to negligible international tourists. Still, the fact that the hotel giants like Hyatt focus more on the transversal measures helped them in gaining significant competitive advantage in the marketplace (Wang, Jin, Fan, Ju and Xiao, 2020). Thus, the innovation-oriented PMS systems help organizations in the hotel industry get inclined towards aiming more on the evaluation and involvement of their employees rather than establishing a closed-loop system of communication. The evaluations help employees figure out the loopholes where efforts and work are required to be made so that productivity and customer services could be rapidly improved.
Further, the traditional performance management systems are looking to the end financial results to understand the businesses' performance, which is perhaps responsible for the additional chaos. Therefore, it becomes essential to focus on the hotel's primary goals and objectives to notify the stakeholders about the same (Chen et al., 2011). In this regard, the traditional performance management systems helped the hotelier groups measure the occupancy, profit indicators, and ROIs of the businesses that lack focus on employee management (Li, Sanders and Frenkel, 2012). In other countries such as the United States of America and the United Kingdom, the scenario is different as their culture astonishes more on value-adding services. For this purpose, hotel groups such as Marriott and Hyatt understand the importance of value-adding services for which relevant employee training and orientations are required to be implemented time-to-time (Chen et al., 2011). Whenever the employees of such hotelier groups are demotivated with their performances, the management becomes responsible for bringing up their morale and acting as a catalyst to procure the optimum productivity. These include employees from various organizations, such as HRM, catering, laundry, and restaurant staff (Kim, Wright and Su, 2010). The room service people are considered to be given a different level of training and development sessions for which conventional strategies are rapidly implemented.
It has also been found that the implementation of PMS (Performance Management Systems) has some profound implications for both the employees and the business of an organization. Concerning the aspects related to an organization's employees, the PMS systems have some direct impact through the reward and recognition systems. The conventional PMS systems also help a hotel's employees understand what exactly is expected out of them and hence provide enough breach holes for them to nurture their skills and efficiencies (Rodríguez-Antón, Mar Alonso-Almeida., Celemín, and Rubio, 2012). In today's modern era of knowledge work and workers, information is also playing an essential role in the hospitality industry. Thus, PMS systems help human resources strategize their working and tasks to contribute to the organization's end goal. For this purpose, it has been found that hotelier giants like Hilton, Marriott, and Hyatt are comprehensively investing in hiring the right fit for training and development purposes. Hence, it is most commonly found that implementing the right PMS system is a matter of four broad processes and steps. These include steps such as getting the right people, setting expectations and objectives, performance coaching, and lastly, getting rid of the poor performers.
Lastly, due to the disappointment gained from the traditional performance management systems, many hotel groups are acknowledging the potential of contemporary PMS for their organizational structures. The contemporary performance management systems are found to be including some CSFs (Critical Success Factors) to provide a foundation for the relationship between performance measures and the management goals. With that said, it has been found in such PMS that building an effective IS and KS (Information System and Knowledge System) is perhaps essential for the hotelier groups and organizations (Pham, Tučková and Jabbour, 2019). Knowledge management provides an opportunity to pinhole the required essentials and requirement of employee management systems for which effective decision making has to be established within the organizational context. The aspects associated with management problem solving helps the PMS system to get implemented more astonishingly. The Chinese hotel associations are still focusing on traditional performance measures while they should rethink the conventional strategies. It has also been found that an independent PMS system that is free from all the cost-oriented aspects results in gaining an overall advantage over the profit made by the organization. In addition to this, the indication and results could be easily extracted from the feedback given by the customers and visitors of the hotels (Decramer, Smolders, Vanderstraeten and Christiaens 2012). For this purpose, the PMS system has to include some side-ways for the feedback system from the guests as well. Thus, the contemporary PMS systems help hotels improve various areas such as training programs, marketing practices, employee relationships, and employee management strategies.
Proposal for a New Performance Management System for Hilton, China
Considering the current PMS system that is implemented in Hilton, China, it has been found that the system is lacking in various aspects. These include individual performance evaluation, target measures, performance reports for OMS and SMS, and a particular framework for the performance management system. The new performance management system for Hilton, China, will include strategic objectives and goals and operational performance data as the inputs, business, unit, and individual performance evaluation as the processes, performance reports for OMS and SMS as the outputs, and performance measurement framework as the key success factors. This would be done in eight broad steps (De Waal, 2013). The first step will include configuring the SMS (strategic management system) for Hilton to produce respective strategies, objectives, goals, and outputs. The second step will be to configure the OMS (operational management system) for Hilton that will result in operational outputs such as customer, financial, social, and environmental strategies for the employees. The third step will be about establishing PMS (performance management system) for Hilton, China, resulting in performance measures, targets, and feedback reports for employee management of the hotel.
Similarly, the fourth step will be all about deploying the respective strategies from SMS (strategic management system) to OMS (operational management system) (Striteska, 2012). Both the SMS and OMS play an essential role in the new performance management system for Hilton, China. The next stage is step five, which will include processes to submit the respective objectives from SMS (strategic management system) to PMS (performance management system). Similarly, in step six, submitting the performance-oriented measures and targets from PMS (performance management system) to OMS (operational management system) will be done. Next, in the seventh step, the transmission of the performance results from OMS (operational management system) to PMS (performance management system) will be revised and achieved thoroughly (Kourtit and Nijkamp, 2013) (see exhibit 2). Finally, in the eighth step, respective performance feedback will be accumulated and evaluated in detail so that efficient feedback could be given more significance. Hence, it could be possibly echoed that the strategic performance management framework will focus not only on the key performance indicators of the employees of Hilton, China, but also on both the aspects associated with the strategic management system and operational management system.
Figure: Strategic Performance Management System for Hilton, China
Source: (De Waal, 2013)
This performance management system will allow Hilton Chine to explore and prepare for worst-case scenarios like the COVID-19 pandemic. It will also allow the giant group of hotels to focus more on the research from original feedback and sources that might also help encounter a wider range of stakeholders. For this purpose, Hilton should also acknowledge the potential of HCSM (Hypothetical Case Study Method) to conceptualize the adopted PMS (Ferreira and Otley, 2010). Performance Management Systems' role is wide in terms of applying both the strategic management system and operational management system in an organization like Hilton. The Hilton Corp is also neglecting the potential of rewarding their employees with the best benefits and compensations, due to which the retention rate might gain a sudden spike, especially post COVID-19. For this purpose, the SPMF (Strategic Performance Management Framework) will help the organization's management in figuring out the loopholes where work is significantly required to be done. The hospitality and hotel industry in China focuses a lot more on the guests rather than focusing on their own employees and their employability (Chen et al., 2011). Thus, the new performance management system will also help Hilton establish an open-loop system where all the employees of the organization, irrespective of their designation, will enable them to provide insight into their working experience with the hotel.
It has also been found that communication plays an essential role in developing the effective working of an organization's employees. For this purpose, the new performance management system will include a division under which effective communication will be established more profoundly. The SPMF will include a panel that will intervene with the respective employees on a bi-weekly and monthly basis. This will help Hilton's management develop an effective relationship with its employees (Melo, Sarrico and Radnor, 2010). Often, neglecting the communicational aspect leads to employee retention rates due to which the relationship remains at stake. The older or say the current version of the performance management system of Hilton China has no division for the mainstream communication with the employees of the organization due to which sudden tactical issues were faced during the early months of COVID-19 outburst in China. Hence, these obstacles could be easily resolved with the new performance management system that is SPMF. Thus, it could be echoed that decision-making will be one of the key areas where this new performance management system will profoundly contribute (Van Dooren, Bouckaert and Halligan, 2015). Hence, the SPMF (Strategic Performance Management Framework) is profoundly suggested as the right and best fit as the performance management system for Hilton, China.
To conclude, this report aimed to propose a new performance management system for Hilton Hotel, China. For this purpose, this report has included segments such as an overview of Hilton, China's current employee performance system, and a discussion on the initiatives that as a manager will be taken and implemented in the hotel for improving the performance of the employee management systems. Further, a discussion on similar performance management systems has also been discussed from employee well-being. Lastly, a new PMS proposal (Performance Management System) for Hilton China has been suggested that included the potential of SPMF (Strategic Performance Management Framework).