Challenges And Issues In Hospitality Human Resource Management – A Case Study Of Taj Dubai

Competition in the Dubai Hotel Industry

Discuss about the Challenges and Issues in Hospitality Human resource Management.

In this highly competitive travel and tourism market in Dubai different renowned hotel chains like Four Seasons, The Oberoi, Hilton Hotels et cetera have tried to penetrate the market which has made it tougher for new Hospitality organisations to enter the market. One such organisation is the Indian Hotel Chain Giant the Taj Hotels. The Taj hotels have opened two new properties in Dubai and the organisation is trying to penetrate the market with its unique and authentic Indian style which has helped it to make an impression in the market. One of the key challenges that almost all the different hotel chains had to face in the Dubai Hospitality market is staffing issues and hence it has become extremely important for the organisation to analyse the different issues and challenges that the organisation faces in recruitment, selection and retention of staffs in the Dubai operations which would help to make effective and suitable recommendations for the organisation to improve its business operations and gain competitive advantage in the market (Dowling, Festing & Engle, 2013). Hence the present study will take an opportunity to discuss the different key aspects of recruitment, selection and retention for The Taj Dubai and will suggest key strategies to improve HR operations which would help the organisation to make sure it has proper and suitable workforce to compete in this highly competitive market in Dubai.

The hotel industry is one of the most competitive industries in the global market. All across the world there has been a certain boost in the interest among people regarding travel and tourism which has helped many hotel companies to develop their businesses in different regions of the world. Travel and tourism industry has spread all over the world which has helped the number of tourism organisations to establish their business and serve number of tourists all across the world. All across the world there are number of destinations that have become very popular among the consumers like UK, Australia, Greece, Malaysia, Thailand and UAE especially Dubai (C.G. Davidson, McPhail, & Barry, 2011). Dubai the heart of the UAE has become one of the most visited and loved tourism destination all across the world even in a highly tumultuous condition of the Middle East. Huge number of tourists every year visit Dubai for its wonderful scenic beauty, Aristocracy, and for its shopping culture. Dubai is one of the richest places in the Earth and hence most of the rich people visit Dubai for its exclusive nature. It is considered as the Las Vegas of the Middle East and the conditions here are largely conducive for travel and tourism (Boxall & Purcell, 2011).

Key issues and challenges in HR for Taj Hotels in Dubai Operations

It is important to mention that in last few decades Dubai has become a complete tourist destination and a number of classic hotel chains have grown up in this area which has slowly and steadily become highly competitive. Given the constant increase in interest among the consumers regarding Dubai, there are various top class hotel chains which has increased the competition in the hotel market in Dubai. In this scenario entering the hospitality market in Dubai wouldn’t be highly successful for an organisation like the The Taj which is one of the leading hotel chains in the world. The Taj Dubai has recently opened up two new properties in Dubai facing the great edifice Burj Khalifa. It has been noticed that the hospitality market in Dubai has become highly competitive but companies have faced setbacks due to the constantly increasing HR issues in the market. The competition has significantly increased in the recent past among the top hotels in Dubai to capture greater market share. The competition has increased among hotels not only to increase the market share but also to have the best possible staffs in the organisation (Dessler, 2013).  

Fig 1: Dubai Hotel Sector

From the above graph it is very clear that Dubai Hotel sector has grown significantly in the last few years. From the year 2009 it has had significant growth and the total occupancy has also increased which is one of the major reasons for the increased competition in the Hospitality market in Dubai. Given the constant increase in the Hotel sector it could be said that staffs have become extremely important for the hotel chains operating in the country especially for the new entrants in the Dubai market. As per the statistics reflected above it could be said that The Taj Dubai will have to be very prudent with their business strategy or else it will face significant issues in the market regarding business operations. The hotel occupancy over the last few years have increased rapidly which provides a great opportunity for the new organisations entering the hospitality market in Dubai but it also requires very efficient workforce which has become an imperative issue in the Dubai Hospitality sector and needs to be discussed effectively (Mondy & Mondy, 2013).

The Hotel Industry in the Emirates has Experiences a major issue which is staffing issue. The staffing issues have been one of the key topics of interest for the Hoteliers and management scholars especially in the Middle East. Organisations like Marriot, Hilton, Accor hotels all have been very particular about their staffing process which would help them to combat the constantly growing competition in the market, but the key HR issues in selection, recruitment and retention have severely harmed the organisational operation and hence it is extremely important for the Taj Hotels Dubai to make sure they understand all the key issues facing the selection, recruitment strategies of the organisation (Mello, 2011).

Strategies to mitigate the key HR challenges and issues for Taj Dubai

In the service industry like Hospitality staffs play a key role in the overall growth and development of an organisation and hence every hotel company focuses on getting the best possible workforce in the organisation which would help to gain competitive advantage in the market, but the attrition level and staffing crisis in the leisure sector in Middle East Tourism industry has been a tremendous issue that has affected all the strategies taken up by organisations to have a stable workforce working for the organisation. The major challenges that Middle East Hospitality organisations face are learning and development, reinventing human resources, leadership and culture and engagement. The HR professionals in the Dubai hotel industry have faced significant issues regarding recruitment, selection and retention (Bharwani & Butt, 2012). In the highly competitive hospitality industry in Dubai there are several key challenges that the HR department of the organisation The Taj Hotel Dubai will have to face which are:

• Selection, recruitment and retention: One of the major aspects in the business is staffs and the growing hotel industry in Dubai have faced severe employment crisis. The competitive environment in the market has also affected retention and hence the attrition level has increased. With the increase in footfalls the consumers have become highly conservative about the kind of services they are offered but it could be said that lack of efficient staffs have affected the quality of overall service provision in the market. The right application of recruitment selection and retention strategies is important to meet the recruitment objectives of the organisation. Lack of communication is an important issue in selection and recruitment and even in failing to retain employees for the organisation, the high political influence in recruiting local people, lack of proper knowledge and experience are some of the major challenges in recruitment of hospitality staffs in Dubai in this case for the HR department of the organisation Taj Dubai.
• Diversity and discrimination: This is another key challenge that the HR department of the organisation has to face. Diversity maintenance in business is extremely important but it is also important to ensure that people from different working together must not feel aloof and not exploited in any way which would create significant issue in the business (Chan & Kuok, 2011).
• Corporate culture: The corporate culture of an organisation is the way it perceives the society and tries to contribute to the overall growth and development of the society. The Taj is very particular about its corporate culture and have become renowned for its effective corporate culture but operating in a completely different environment could create significant problems for the company and it might not be able to implement the same corporate culture within the operations and hence it is important for the organisations to make sure it is able to understand as well as focus on constantly working on its corporate culture (Chen, 2009).
• Legal and political issues: The legal and political issues are the biggest barriers in overseas operation. Most of the leading multinational organisations face legal and political issues while operating and hence it becomes essential for the HR management of Taj to make sure they are aware of the different key legal and political regulations which would help them to comply with while operating in the country. The employment conditions in the Hotel industry are not good because of the demographic changes and generational transitions. On the other hand the high inclinations of companies to place the expatriates in the top managerial positions have had huge impact on the workforce due to communication and cultural issues. The Middle East has been suffering from political turmoil. Even though UAE is hardly affected from this but the police and the administration are highly focused on providing Visas to the right people who takes a huge time for expatriates to go and settle (Day, 2012).
• Cultural issues: Cultural issues are another major difference among the workforce. Understanding the cultural taste and preference of the people in a new place takes a lot of time and hence it becomes really tough to work within a culturally different group and hence it is important for the HR department to make sure effective strategies are implemented in order to focus on having the best possible workforce in place. In Dubai the people mostly speak Arabic and many people are highly skeptical about speaking any other language even though English is widely used in the place. Communication could become tough in case the local employees insist on speaking Arabic or Persian. The Taj Hotel is highly famous for its traditional Indian style and culture which could become a key difference in managing the operations (Dixit, 2014).
• Economic aspects: The HR department of Taj will have to make sure that it is able to cut down on the high areas of costs. Especially in the recruitment process it should focus on having the right kind of workforce but at an affordable price. The higher investment of cost in the early stage of business operations will force significant liability to the organisation which if not met properly will create significant financial setbacks for the organisation.
• Technical issues: In the contemporary business world technology plays a huge role and hence it is important for the organisation to make sure that technical issues like communication and information system are properly managed. This becomes a key challenge to combat as managing database of information, communication systems could be difficult. Implementation of technology could be a complex process and hence there could be number of technical issues which need to be eliminated before it takes a toll on the business operations (Garcia-Carbonell, Martin-Alcazar, & Sanchez-Gardey, 2014).

These are the key challenges that have the potential to impact the business operation of Taj Dubai if they are not mitigated with suitable strategies.

At the present moment competition is significantly high in the Dubai hospitality sector which needs the organisation Taj to implement an effective recruitment and selection strategy. The recruitment and selection strategy of the organisation Taj Hotel Dubai should be completely based on particular labor market which would help to ensure the right kind of employees are taken in for the operations of the organisation. The labor market in Dubai had fluctuated significantly in the past but now it is becoming steady market.

Fig 2: Labor Force Participation UAE

The above statistics clearly shows that Dubai will receive a consistent labor force participation in this year as well which provides an opportunity for the organisation to choose its labor force properly. It has been stated that the demographic change in the market has significantly affected the organisational recruitments as there will be a downward movement of the labor force in the country. Hence it is important for the organisation to have an effective strategy of proper analysis of the labor market and accordingly choosing people for screening interviews. For this the organisation could use different portals to receive applications and accordingly short listing people. In this case the target labor market of the organisation would be the 18 to 36 age group with at least college graduation degree (for lower level staffs), for management staffs at least an MBA in the respective field will help to get the right kind of employee (Herington, McPhail, & Guilding, 2013).  

The screening interview with some direct questions will help to filter out the different ineligible candidates which would make the system of hiring people easier. The recruitment board will select a panel for the selection procedure where direct questions and job related questions would be asked with practical applications through psychometric tests which would help to get the best possible talent working for the company. The selection and recruitment will be done by complying all the possible laws and regulations regarding the compensation policies and working hours and minimum wage which would eliminate the barriers for recruitment and selection. For retaining the efficient employees the organisation should first of all implement internal recruitment programs which would help to provide financial and positional increments to efficient employees which would help to get engaged with the organisational operations. The intrinsic and extrinsic motivational approach with the help of incentives and fringe benefits better than other companies would also help to retain employees (Kashyap, 2014).

The Geocentric approach to staffing would be an extremely effective approach to retain employees as recruiting people based on their talent in Hospitality industry is very important. On the other hand maintaining the right balance is important for the Taj Hotel and hence understanding the number of expatriates it should have (“Expanding Into New Markets with Limited Resources, by Chris Mumford”, 2017). The governments in the Middle East have created excessive pressure to open job opportunities for locals and hence it is important for the organisation to put expatriates in some key positions and then apply geocentric approach to staffing which would help to get the best possible employees for the different positions. The corporate culture of the organisation is mainly based on professional relationship and participative culture where each and every employee is free to provide their views for the overall growth and development of the business (J. du Plessis, Douangphichit, & Dodd, 2015). In this case the organisation would be able to keep retain its corporate culture by breaking the communication barriers through different kinds of communication. Implementing an effective cross cultural upper management team who have ample experience of handling overseas operations and have expertise in developing foreign relationships will be highly effective in this situation (Mahendru & Kaleka, n.d.).

Putting in place effective performance management system will largely help the organisation to make sure the workforce is performing well and it will also help to understand the training and development needs. There are different performance management tools but for the initial phase of the business the Key performance indicators will work very effectively for the employees working in the organisation. The On Job Training program is effective for the employees to get continuous knowledge, on the other hand the training based on the culture, language and Occupational health and safety should be given in order to make sure the employees are ready to hit the floor (“HR Policies At The Taj: Lessons To Emulate | Business Article | MBA Skool-Study.Learn.Share.”, 2017). The hospitality sector is very hectic for the employees and hence it is important for the employees to provide work life balance which would only come when the organisation realises its workforce as assets. The Taj Hotel’s culture has always been focused on providing its employee flexibility for which it has developed number of effective strategies. The organisation should provide work flexibility to the employees like providing short flexible work hours, proper break timings, and effective company sponsored holidays and vacations which would help to keep the employees content and engaged with the company (Paauwe, 2009).

The organisation believes in Corporate Social Responsibility and hence focuses on encouraging its employees to take the responsibility which not only helps to motivate employees to work for the company but also helps to make sure the society also backs the organisation. The company focuses on contributing to the environmental awareness campaign, reduction of plastics and paper usage, educational awareness campaigns and it represents its employees which creates a deep bonding with the employees. Hence it could be said that the organisation Taj Dubai should use these strategies to mitigate the operational issues and challenges (Sherkar, 2015).

Conclusion

The organisation Taj Hotel Dubai has entered a very competitive market and it is important for the organisation to address its recruitment, selection and retention issues. A geocentric approach to staffing will help the organisation to make sure the right mix of expatriates and local people are there in the workforce that would help to be in good terms with the government and the administration of the country. Effective performance management with the help of KPIs and on job training procedures will be effective in developing workforce of the organisation. The corporate culture could be used to make sure that employees communicate among each other breaking any barrier of communication and background issues (Sherwyn, 2008). Finally the organisation would be able to engage employees through CSR campaigns and by providing work life balance through flexibility.

• It is important for the organisation to recruit upper management staffs through internal screening which would help to have people experienced in handling overseas business. This will make them efficient expatriates ready to control foreign workforce.
• The implementation of technology for efficient screening of the employees is important as it will help to get the right kind of employees for the organisational operation (“The Practice of Aligning HRM to Business Strategy and It”, 2016).
• The implementation of extrinsic and intrinsic motivational concepts will be effective. This will help to understand the interest of the different employees and accordingly help to compensate them helping to retain employees effectively (Vashishth, 2012).
• There is a strong need of a research and development team to be in place as this will prove to be highly efficient for providing suggestions and insights on the market information about the competitors and their movements in the market.
•  Establishing leadership in management will be extremely important for the organisation as it will help to focus on implementing the strategies discussed and analysing them to understand their efficacy. Leaders play an important role especially in overseas operation and hence application of suitable leadership is essential for the organisation (Wood, 2003).

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