ABSTRACT
Hospitality industry is functional service
sector where optimal human resources management is required for successful
delivery of good and service, where productivity and retention are determine
factors of overall success of an organization. Human resources is the most
valuable asset of any organization, the success or failure of any organization to
a large extent depends on how effective they were able to manage their human
resources, their needs and working conditions must be satisfied if an organization
must achieve its aims and objectives. Human resource management practices
deployed in this study are training and development, remuneration, promotion
and staff engagement.
The
researcher used both the primary and secondary data in the course of the study.
A survey research design was adopted. The population of the study comprised all
hotels rating with five, four and three star hotels in Ikeja, Lagos State. Six
hotels were selected using stratified random sampling, with 726 employees. Pilot study was carried out in one of the
hotel to ascertain the reliability and validity of the questionnaire. The
sample size of the study was 256 employees derived using the Yaro Yamani
formula for the determination of sample size. A total number of 256
questionnaires were distributed and 206 returned. Structured interview were
conducted with three of the hotels manager in each of the hotels’ category. The
researcher used simple percentage and regression analysis as statistical tool
for the analysis.
Findings revealed that the variables of human
resource management practices used in this study, Staff training and development, remuneration, promotion and employee
engagement are significant correlated with employee retention. It shows
that providing adequate training and development, remuneration, promotion and
engagement for employees lead to increase in
retention rate an organization and reduce staff turnover.
The study concluded
that adoption of human resource management practices enhances employees’ retain
ability of organizations. There is need for proper coordination, control and
implementation in order to achieve organization objective and at the same time
reduce employee turnover which has caused great havoc in the industry.
CHAPTER ONE
INTRODUCTION
1.1
Background to the Study
The hospitality industry is a functional service sector
where standard human resource management is needed to enhance professionalism
and efficiency in the delivery of good and service. According to Joint
Hospitality Industry Congress in Lashley (2000) hospitality is defined as the
provision of food, drink, and accommodation away from home. It is an
interactive process that exists among customer and host which can eventually be
companies or organization. The hospitality industry is among the sustainable income
generating sources for economic development. Hence, this has generated interest
in educational sector because of its impact on the country gross domestic
product. The hospitality industry is seen as a major sector for many countries
in the development of their socio-economic growth and some countries impact
their economic fate within a desirable period by engaging in hospitality
oriented businesses (Uddin, Das; and Rahman, 2008). The hospitality industry is
central and essential to the general welfare of many countries in the world,
revenue from hospitality industry is one of the main sources of foreign
exchange in some regions like Fiji, the Caribbean, and Hong Kong. It contributes to the growth of an economy by
creating jobs opportunities and funding a large percentage of a country's Gross
Domestic Product. It enhances the level of national income by earning foreign
currencies through the goods and services supplied to foreign visitors thus
improving the balance of payment (Baker, 2006).
Hospitality management includes management of hotels, travel
agencies, restaurants and some institutions which are anchored on the
hospitality industry. Services of the hospitality industry are usually
patronized by tourists; when people eat in restaurants, lounge in hotels, go
out to watch movies or engaged in similar activities. Tourism is one of the
vehicles that drives Hospitality Industry while hospitality industry provides
services for tourists such as transportation, accommodation needs in resorts,
hotels restaurants, pubs and bars, food and beverage, recreation and leisure.
The strategic importance of hospitality industry to tourism was confirmed by
the United Nations World Tourism Organization (UNWTO) that 70% and 75% of
international tourists' spending goes to hospitality services on an annual
basis (Akpabio, 2007). The World Travel and Tourism Council (WTTC) attests that
hospitality employment in both developed and developing countries worldwide
accounted for over 230 million or 8.7 per cent jobs (WTTC, 2006).
In the midst of an economy meltdown in Nigeria, the
hospitality industry contributed 2.75 billion in 2007. 3.10 billion in 2008,
3.44 billion in 2009, 245.7 billion in 2010. 268.41 billion in 2011, 310.96
billion in 2012. 540.63 billion in 2013, 639.71 billion in 2014, and 654.22
billion into the economy according to the National Bureau of Statistics.
Worland and Wilson (1988) described the hospitality industry as an
establishment that includes but not limited to services in hotels, restaurants,
licensed clubs and motels. Therefore this dissertation will consider hotel
industry as one of the hospitality industry since it has been identified as one
of the fundamental drivers of the growth and development of tourist sector in
Nigeria.
Lagos has about 1329 hotels of different categories. In the
last three years, many hotels have been established in Lagos such as ibis
Ikeja, Intercontinental, Best Western Starfire and African Sun GRA. The survey
carried out by Lagos state bureau of statistic revealed that N82, 630,620,896.52
representing 0.68% of State GDP are generated by hotel and restaurant sector
(CBN, 2012). The primary importance of the hotel industry is reflected in the
temporary accommodation offered. Nevertheless, extended conferencing facilities
such as event halls, seminar rooms and accommodation provided to business and
leisure traveler are the core values of the hotel industry. There is an
expansion of existing hotels with infrastructural development such as car park,
swimming pools and more new buildings with larger guest rooms, therefore,
adding quality services and products as an advantage for guests apart from
basic need and shelter. Food and beverages services are also a source of
revenue from the guests (Oshindeyi & Babarinde, 2010).
Human Resources is the valuable assets of any
organizational success. Unlike a machine, people are responsible for financial
management, maintenance of equipment and coordination of other assets in an
organization. Damaged control in HRM involves heavy financial provision than
others. In a hotel industry employee play an important role in the service
delivery, from arrival to the moment of a guest checked into the hotel to the
last moment a guest check out from the hotel. Therefore hotel employees are the
most essential assets, their personal needs and working conditions must be
highly motivated if an organization must realize its goals and objectives. The
business of hospitality is people oriented, hospitality industry must exercise
great effort to attract qualifies and competent human resources so as to
achieve the organization objectives through optimum performance.(Alan &
Compton, 2011). The hotel industry requires a committed labour force,
therefore, effective human resource policies, and guidelines must be developed
for competitive success (Alleyne et al. 2006).
Engaging
professionals is important for any organization, but their retention and
productivity are determined factors for the overall success of an organization.
Retention benefits contribute to an
employee’s loyalty and commitment, and employers who offer these benefits show
respect for the employee’s role at work and at home. Offering these benefits
can contribute to a facilitative climate of support, which gives employees
greater control over their work responsibilities and career goals. When
employees know that their organization supports them, they reciprocate with
greater effort (Galinsky & Stein, 1990).).
Research has shown that employees who are satisfied with their benefit
program are three times more likely to be content with their job and to feel
loyalty toward their employer than their peers are (IOMA, 2003).
In other to have a successful operation of the hotel
industry in Lagos, It is essential that the main focus in the contemporary
hotel industry should be on human resources management practices. It is
imperative to investigate and determine the usage of human resource management
practices by hotel industry in Lagos. Therefore this study will examine some
human resource management practices in aspect of training and development,
staff engagement, remuneration and promotion; possible ways to retain the best
and competent employee to reduce staff turnover in the organization.
1.2
Statement of the Problem
The human
resources practices are form of policies designed to attracts, develops,
motivates and retains competent employees to ensure the effective
implementation and the survival of the organization. It is one form of
resources derived from the organization that can assist organizational members
to achieve their work goals, reduce their job demands and stimulate their
personal growth, learning and development. For hotel industry to achieve its
target goals depends on how effective the industry are able to implement these
practices.
The hotel
industry in Nigeria from 2012 to 2015 has witnessed considerable growth,
especially in Lagos, an economic nerves of Nigeria; because of the ever
increasing programs invested in the city and unrestrained inflow of visitors
from within and outside Nigeria for various reasons ranging from business,
academics, and pleasure. Due to increase demand for the shelter and also the
hosting of several major international events like Commonwealth, African games,
Carnivals had consequently encouraged the springing up of new hotels and
restaurants with quality services render to meet international standard. Ikeja
area of Lagos state is a commercial town with shopping malls, pharmacies,
government residential area, industrial estates as well as location of Murtala
Mohammed international Airport, all these sustain the thriving of hotels
market.
Tourist sectors
expenditure pattern for Lagos from 2012-2015 consistently showed that 37
percent of tourist expenditure was spent on accommodation which has spawned the
development of hotels in Lagos. In spite of the contribution of this sector to
economic development, the hotels often witness high turnover rate; a report
submitted by International Labor Organization (2012) on labour turnover in
the World tourism and hospitality
industry in year 2015 shows the quitting rate of an employee of food and
accommodation sector of hospitality industry ranging from 4.1- 4.6 percent
about 3, 413,000 while it is assumed that the daily growth in the hospitality
industry accounts for staff movement.
It has been debated that the level which workers are
comfortable with their responsibility and willingness to remain in an
organization is a function of organization remuneration packages and incentives
(IJABE, 2012). The inability of HRM of hospitality business to attract, engage
and retain suitable employees with the right knowledge, skills, and attitude to
steer the day to day operation are becoming challenging issues in the industry,
the implication is that it reduces the quality of service that might equally
influence the preference of customers as to where to patronize while at the
same time often led to a loss of experienced hands to other sectors.
In Nigeria, efforts to get turnover rate in the industry
proved relatively difficult however a sample of hotels visited revealed
turnover rate from 2007 to 2017, 10 percent in five, 29 percent in four star
and 28 percent in three star hotels motivated this study to examine human
resources management practices and employee retention and reasons for staff turnover
in selected hospitality Industry in Ikeja, Lagos State.
1.3 Objective of the Study
The main
objective of this study is to examine the human resources management practices
and employee retention in selected hotel industry in Ikeja, Lagos State. The specific
objectives are to:
1.
identify
the effect of staff engagement on employee retention,
2.
evaluate
the effect of remuneration on staff retention in selected hospitality industry
;
3.
access
the impact of staff training on employees’ retention in selected hospitality
industry and
4.
examine the influence of staff promotion on
employees’ retention in selected
hospitality industry
1.4 Research Questions
1. What is the effect of staff
engagementon employee retention in selected hospitality
industry?
2. How has the remuneration policy
affect employee retention in selected hospitality
industry?
3. In what ways has staff training
impact on employee retention in selected hospitality
industry?
4. How has staff promotion influence
staff retention in selected hospitality industry?
1.5 Hypotheses
H01There is no
significant effect on staff engagement and employee retention in selected
hospitality industry.
H02 There is no
significant effect on remuneration policy and employee retention in
selected hospitality industry.
H03 There is no
significant impact on staff training and employee retention in selected
hospitality industry
H04 There is no
significant influence on staff promotion and employee retention in
selected hospitality industry
1.6 Significance of the Study
The success of every organization depends on the effective
human resource practices adopted by the organization. The organization cannot function well without
adequate human resource practices put in place. To examine those factors that
delineate the performance of hospitality staffs which at the same time
contribute to staff turnover, employee satisfaction, and growth of hospitality
industry. This study is unique as is coming at a time when there is a decline
in human resources management practices in most of the hospitality industry in
Lagos. Based on study that investigated the relationship between the use of 12
HRM practices and organizational performance Seonghee et al. (2006).
The result revealed that organization that employed HRM
practices are subject to turnover reduction rates for the non-administrative
employee. The study is set out to examine human resources management practices
as it enhances productivity and job satisfaction of employees. It is expected
that the study would identify areas where inadequate and inappropriate HRM
practices are employed and provide a solution to optimum performance. The study
would also provide scientific and empirical information that would create a
robust relationship and understanding between employee and employers in the
hospitality industry. The result would be helpful to top management in the
development of HR practices as to ensure the sustainability of retention of the
employee. It would also add to the body of knowledge in respect of hospitality
industry and the effect on company's turnover. It would as the same time serve
as a guide to the practitioner in the hospitality industry.
1.7 Scope
of the Study
Studying human resources practices in the hospitality
industry in a single research effort may be unwieldy, for this reason, the
researcher has decided to examine hotel sector as one of the hospitality
industry in Ikeja, Lagos State. Ikeja been capital city and habitant of
business center and many hotels, also because of its closest vicinity to the
airports. This study will consider only 5, 4 and 3 star hotels within Ikeja
area of Lagos for the period of 2007 to 2016. It will further concentrate on a
variable item such as employment practices, remuneration policies, promotion,
staff engagement and identifying challenges with the administration of these
policies on employee's retention.
1.8 Operational Definition of Terms
Hospitality: Hospitality by the Joint
Hospitality Industry Congress is defined as ‘The provision of food and drink,
accommodation away from home' Lashley (2000)
Hotel: A commercial establishment
providing lodging, meals and other guest services
Recruitment:
Recruitment refers to the process of attracting, screening and selecting qualified
people for a position within an organization.
Retention: A process in which the employees
are encouraged to remain with the organization for the maximum period or until
the completion of the project.
Staff turnover: as the ratio of the number of organizational
members who have left during the period being considered divided by the average
number of people in that organization during the period. (Glebbeek & Bax,
2004), (Price, 1977)
Employee turnover: is described as employees who have
left, are leaving and will leave an institution for various reasons (Grobler,
Warrnich, Elbert & Hatfield 2006, p. 125). A similar definition is provided
by (Morrell, Loan-Clarke and Wilkinson 2001) who state that turnover means
voluntary cessation of membership of an organization by an employee of that
organization
Five star- these are hotels that have luxury
settings, flawless guest service, offer only the highest level of
accommodations and services.
Four star- these are hotels that have
superior property and a variety of amenities, mostly large, formal hotels with
smart reception areas, front desk service, and bellhop service.
Three star- these are hotels that have high
service additional amenities, typically offer more spacious accommodations that
include well-appointed rooms and decorated lobbies
Two star- these are hotels that meet a basic
need, typically smaller hotels managed by the proprietor. The hotel is often 2
- 4 stories high and usually has a more personal atmosphere. It′s usually
located near affordable attractions, major intersections and convenient to
public transportation.
One star- these are hotels that meet basic
budget needs, usually, denotes independent and name brand hotel chains with a
reputation for offering consistent quality amenities. The hotel is usually
small to medium-sized and conveniently located to moderately priced
attractions. (WTO & I H & R A, 2004, p. 74).
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