MM 5004 Operations Management

Dermawan Wibisino, Phd Human Resources: Recruitment Process in Hospitality Industry

Prepared by: 29111311 Haidir Afesina

Executive 46 MASTER OF BUSINESS ADMINISTRATION 2012

EXECUTIVE SUMMARY
This report is talking about Operation Management practice in Human Resources area specified at recruitment. The report itself is focused on Hospitality industry with Hotel Mulia Senayan Jakarta as a case study. As one of the leading hotel industry with 2900 employees, recruitment system has an important role in order to achieve the vision and mission of the company. It is not an easy job as it has small team on recruitment while serving lots of applicant. Not only that but is also the timing to hire new employee should be correct. Thus would effect to the effectiveness of the system and the team. Therefore this report is defining the problem that meet by the department along with formula to solve it. Both of theory from Human Resources and Operation Management are being used in order to create the alternatives as a recommendation.

TABLE OF CONTENTS EXECUTIVE SUMMARY ................................................................................................. TABLE OF CONTENTS .................................................................................................... I. INTRODUCTION ...................................................................................................... 1.1 Background ............................................................................................................. 1.2 Aim and Objectives ................................................................................................ II. FINDINGS ................................................................................................................... 2. 1 Hotel Mulia ............................................................................................................ 2. 2 Solution .................................................................................................................. III. RECOMMENDATION .............................................................................................. REFERENCES .................................................................................................................... 1 2 3 3 3 4 4 3 7 10

I. INTRODUCTION 1.1 Background Behind the luxurious of hospitality industry, especially in hotel, recruitment has been a very interesting part which mainly focusing on secondary labour market. Secondary labour market is people with unskilled or semi-skilled with low pay, job insecure and less career development possibilities. In contrast with primary labour market tends to be recognized as high skill, well paid job, job secure and good career development possibilities. Some of the recruitment itself is promotion from internal or inside the organization as it is more efficient and save cost in order to fulfil strategic position. It is such a promotion based on age, skill and experience. Therefore it is not a big issue that most hospitality business sometimes would not hire the right people to fill some strategic positions. Mostly the recruitment to fill most position is coming from external because of social and demographic (Mckenna and Beech, 2002). Thus hospitality industry as industry which people know most of the works are low status, unstable and long hours work are preferred to hire people from secondary labour market and external (Goldsmith et al 1997). The process of recruiting itself has taken some time, approximately one to two months. It is to get a promising candidate even though there is no guarantee whether the person would be able to stay for a long term. Human resources department has a big responsibility to create a recruiting strategy so that the procedure will benefit both of the company and candidate itself. Therefore they have to be able to suit the job to the person. Otherwise it would create lots of turnover because of stressful and lack of motivation, as the job desk is unclear and underperform (Goldsmith, Nickson, Sloan and Wood, 1997). Not only that but also the scheme of rewards and benefits has a deep role in order to bring employee motivation. Therefore this report is focussing of the recruitment process and procedures in hospitality industry with Hotel Mulia as an example along with the Author experiences. 1.2 Objective The aim of this report is to analyze the strategy of Hotel Mulia Senayan to successfully attract people to work at. The objectives are; To define the process of recruiting system; To analyze the importance of recruiting people as an asset

II. FINDINGS

2.1 Hotel Mulia Hotel Mulia Senayan is becoming the phenomenon as a luxurious local brand with five star services in Jakarta. Not only that but also among the hotelier in terms of jobs. Established in 24 September 1997, the Hotel was built to support the Southeast Asian Games (Sea Games) in Jakarta. Then transformed to the best city hotel. It has 996 rooms (suites and presidential) with a great location in the heart of Jakarta. Thus, it suits to satisfy the needs of both the business and leisure traveler alike. Under Mulia Group that owns prestigious office towers include award-winning landmarks such as Wisma Mulia, Wisma GKBI, and Taman Anggrek Mall & Condominium, it has excelled in its standards of hospitality. A vision to be the best independent luxury hotel offering personalized service and care has made the World Travel Awards honoured several prestigious awards in terms of facility design and services it from 2005 to 2010. Also the mission of deliver our promise of excellence made it achieved five star diamond class. Therefore it is also successfully attract hotelier to work in such a world-class independent hotel. As a local independent hotel brand, Hotel Mulia Senayan has also succeed to invite expatriates apply for a position. Having supported from Mulia Group as parent`s company with its Ceramic and Glass industries, Hotel Mulia Senayan is able to offer a competitive rewards and benefits to employee. A motto of celebration the finest thing in life is trying to be communicated to all employees including candidates. However, the process to recruit the right person for the right position is taking some time. Thus it creates an empty place and effect to the operation. Workforce Hotel Mulia Senayan has divided the employees into three categories. There are permanent (full time), contract (temporary) and daily worker (part time). In December 2011, Hotel Mulia Senayan has 2900 employees (800 permanent, 1200 contract, and 900 part time). Most permanent staffs are on supervisor level above and experience more than 3 years. Then most the contract staffs are those at the staff level and less experience. Daily worker are those who have no experience. Most of the permanent staffs are at the back of the house (office) while the rests are at front of the house (front liner). The working days are six days working and one day off (also known as six-one) for office employee starts from 08.30 16.30 (including one hour break) with three hours maximum over time. However, the difference for the front liner is that they have a shifting working time and being rotated on weekend or public holiday for their days off. Then the over time

hour is unpaid. Daily worker working time is day basis as government rule. They have a limitation to work maximum total of fourteen days work and a must for having another fourteen days off before they start to work again. Rewards and Benefits Hotel Mulia Senayan has provides a competitive service charge compare to other international five star hotels in Jakarta, especially with the total amount of employees. Thus it attracts people to apply. The scheme of the salary is a total of basic salary with service charge. Service charge is the unique part of hotel industry scheme as it is depend on hotel`s revenue. Therefore it is change monthly. Moreover insurance is given on the first day of both contract and daily worker while permanent have it after pass the three months probation. In addition transportation allowance and twice meals time on working days are given to employee. For daily worker, they have different rates work on weekdays, weekend and public holiday while others not. Then both of permanent and contract entitled for one annual leave monthly, which only can be taken after one-year service. 2.2 Problem Focus Having lots of business happening is a great thing in this industry. Also it is a challenge to recruit a talent who will suit with the job. The highest demand and turnover is coming from service department i.e. food and beverage. Therefore human resources have to be able to hire new employee to fill the empty position. However, there is a responsibility that every department to follow the procedure as it takes some time i.e. staff requisition. Many conflicts happened because of unplanned recruitment to meet immediate needs base on skills (Noel, Hollenbeck, Gerhart, Wright, 2008). Then to get the applicant is using word of mouth advertising because the needed of immediate employee while the hotel website rarely updated. It is difficult to always anticipate exactly how many new employees will have to be hired in a given year in a given job category. However, by having historical data as evidence, it will be helpful in order to forecasting the demand. Then every department will know if there will be future labour shortages or surpluses. Compare to other department, food and beverage department is the most department which need daily worker type. The problem for the recruiting team is that many of outside applicants are declined the offer after they wait for some time i.e. approximately two to three weeks. Also the processing time and type of the test are too long. Then to get outside applicants for new atmosphere in some high level position is costly i.e. training. In addition the negotiation with the applicants is given in a week time. The other problem with the recruiting team is a wider job desk among

the team. Not only taking care of recruitment but also coaching and development. Furthermore, many of the databases of applicant are still in a paper base while the electronic filling system still in progress i.e. HRIS (Human Resources Information System). Flowchart of Recruiting SOP Staffrequisition/ demand (1 day) Advertising CollectingCVfrom applicants

(21 days)

NO
Archive

(7 days) CV Selection

YES
(1 day) HRInterview

(7 days)

NO
Test Result Selection (1 day) Test(psychotest,DISC/ MBTI,English) (1 day)

YES

Interview Result

NO

Archive

(1 day)

YES
UserInterview (1 day) (1day)

Interview Result

YES

Negotiationand MedicalCheckUp (1 day)

NO
Archive

NO

Test Result Selection

(7 days)

YES
Demand Achieved Placement

NO

YES
2.2 Solution

END

The problem that Hotel Mulia Senayan meet is not only processing time to get new hire but also the man power inside human resources itself. Then the databases of applicant that is disorganized and ineffectiveness of job advertisement. To get new hire in 43 days is such a long time. The operation has to run, as it is the main earning revenue in hotel industry. So that the labour forecast is obviously needed. By focusing on labour planning, the competitive advantage of human resources strategy will be achieved (Jacobs, Chase, Aquilano, 2009) Therefore there are some solutions in order to solve the problem that Hotel Mulia Senayan meets; 1. Increasing manpower in human resources department expertize in recruitment 2. Reduce duplication of human resources activities 3. Creating distributing channel for job advertisement not only in internet but also through university job centre 4. Reducing time at recruiting process 5. Having a list of potential candidate both of internal and external who apply for any position 6. Developing skills of current employee and have it rotated among department (person in need of job development) 7. Encouraging the department to promote of their daily worker staff or colleagues within department 8. Educating the leader at any department regarding the labour forecast

III. RECOMMENDATION

From those all solution, the Author recommends to focus in creating strategy in reducing the time at recruiting process. Firstly human resources department and all department`s leaders get together in order to create a planning of labour forecast and be committed with the procedure.

Forecasts of labour surplus or shortage

Goal setting and strategic planning using HR evidence

Program implementation and evaluation

Process Analysis + Job Design + Work Measurement (Focus on internal development as priority)

According to McKenna and Beech (2002) internal labour market can be useful when organization or industry need replacement of the employee. For example manager of food and beverage resource in one outlet has been resigned, and then the department wants to find replacement. They can take it from people inside. It could be the assistant manager or find someone else within the department. The employee will have a competition to get it and be motivation to work better. It is being used because of people from there are well known about the duties and the responsibilities. It is one of the strategies to prevent turnover. So that it is not wasting time. But if there are no candidates who have the same qualification, then it needs training investment to train all the candidates or take the potential candidates from outside and train them. Sometimes a new employee from outside can be a new atmosphere. But it will have costs. Not only that but also no guarantee that the substituted will be good after in training course (Riley, 1996). The disadvantages of hiring within are that times wasted if will not be considered and there is a chance of status quo with the innovation or development. Then the recruiting process and work measurement using a benchmark approached in order to get the effectiveness of procedure and effort (Jacobs, Chase, Aquilano, 2009). Second, it has to minimise the process while maintaining the quality of applicant at the same time. It is not easy to find the right person for the right position at the right time, therefore the checking references and background and observing the attitude is mandatory.

Staffrequisition/ demand Negotiationand MedicalCheckup

Advertising Test Result Archive Selection

CollectingCVfrom applicants

(1 day)

(A) (7-14 days)

(7 days)

NO
(B) (1 day) (1 day) (D) YES

NO

(1 YESday) 1.Test (psychotest,DISC,English) 2.HRInterview 3.UserInterview

(C)

Test Result

NO

Archive

(3 days)

YES
Placement Demand achieved

YES

END

NO

Once there is staff requisition for demand, the advertising will be post firstly through internal department (A). Then for some position it is possible to post it online and also through university job centre. Minimise the time and screening carefully for those who meet the characteristic and do a background and reference check (B). So that it will be sort it easier. Then reduce the test quantity into three segments; there are psycho test, DISC and English test). However the English test is depend on the job desk itself. After that, the interview will be conduct with two people at the same time (HR and user) or only with person each (C). The result should be discussed straight away after the interview or maximum waiting time is one day, so that it will be very helpful to continue to the next process. If the interview result is able to reach at the same day, try to offer the contract (D). Then given one day to consider the offer and if yes, should process to medical check. It is mandatory to find alternative for medical check up place in order to get a quick and accurate one. Now by having these new steps, the recruitment process can be achieved in 33 days. REFERENCES Goldsmith, Alistair L, Nickson, Dennis P, Sloan, Donald H, Wood, Roy C (1997)

Human Resource Management for Hospitality Services, London: Thomson Learning Jacobs, Chase, Aquilano (2009) Operation & Supply Management, New York: Mc Graw Hill McKenna, E and Beech, N (2002) Human Resource Management , London: British Library Cataloguing Noe, Hollenback, Gerhart, Wright (2008) Human Resource Management, New York: Mc Graw Hill Riley, M (1996) Human Resource Management in the Hospitality and Tourism Industry, 2nd Edition, London: Butterworth Heinemann