Subsidiary To Aitken Spence

Published Date: 02 Nov 2017

Introduction

Aitken Spence Travels (Pvt.) Ltd. is a subsidiary to Aitken Spence (Plc.), which is a blue chip company in Sri Lanka. Aitken Spence Travels (Pvt.) Ltd. is currently the market leader in travel sector handling more than 85,000 tourists in 2011. The company has entered in to different agreements & contracts with leading tour operators in the world: TUI, Thomson Holidays, , Trailfinders, Club Med, Jet Tours, Voegele Reisen, Alpi Tours, Francorosso, Ventaglio, , Jetair, Holland International, Arke Reisen, and many other operators from Europe, Middle East and the Far East. Also, the company handles shore excursions for some of the most reputed cruise operators. All their tour operations have been automated in order to provide an efficient service to our principals and clients. Some of these operators are employing their own employees at Aitken Spence Travels in order to maintain the international standardized service. Aitken Spence is the only destination management company in Sri Lanka to obtain the ISO 9001 : 2008 quality certification. Also it is the only travel company to win the Presidential Award for the Best Destination Management Company in Sri Lanka for 3 consecutive years and enter the Hall of Fame competing with all the other major industry operators.

Company Vision

To achieve excellence in all our activities, establish high growth businesses in Sri Lanka and across new frontiers, and become a globally competitive market leader in the region.

 

Company Mission

" We are here today, here tomorrow. "

Research Techniques

Data collection methods

Primary Data Secondary Data

Survey

One to one discussions Statistical Reports

Web Articles

Primary & Secondary Research Statics of Aitken Spence Travels Diversity

ASTL do have 65% Sinhalese ,15% Tamils, 10% Muslims , 5% Burgers & 5% othersEmployment Type Analysis

ASTL do have 62% Permanat Employees & 38% Contract Employees

Employee Trained Category Analysis

ASTL do have 9% Managers , 30 % Executives and 60% non Executives

DISCUSSION

The Organizational Hierarchy of Aitken Spence Travel (Pvt.) Ltd.

Different officers in different level exhibit different leadership traits. This figure indicates the hierarchy of Aitken Spence Travels & the way authority is granted. In addition to that, information flows through the organization according to the captioned method. Also, the management expects all the employees to report to their immediate supervisors for any requirement: advices, complaint, other, etc. There is one Managing Director & one Chief Executive Officer (CEO) at Aitken Spence Travels, where as there are five Assistant Vice Presidents (AVP). The AVP’s manage the main five divisions at travels: French market, Middle-east market, British market, Asian market & European market. At least two General Managers are reporting to an AVP. Assistant General Managers, Managers, Assistant Managers & Senior Operational Heads are the other authorized personnel at Aitken Spence Travels (Pvt.) Ltd.

Evaluation of Different Strategies being practiced by Aitken Spence Travels (Pvt.) Ltd.

Corporate Strategy:

This leadership style being used by the top management including AVP’s, VP’s & MD’s. They look in to the factors that might affect to the organizations at present & in the long run & make the decisions accordingly.

Cost Leadership Strategy:

Running the strongest vehicle fleet in Sri Lanka, the Aitken Spence Travels is the cost leader in Travel business. Their main garage is situated just 7 kilometers away from the airport & guarantees a safe journey from & to the airport. On the other hand, high skilled vast number of employees then & there attends the different requirements of the clients.

Differentiated Strategy:

Aitken Spence Travels already has a sound reputation over its successful differentiated product & service line. The management still tries to take their products from differentiation to authentic & unique in the future. For example, operations of Heritance Kandalama & Heritance Tea Factory. The management always ready to accept the novel ideas to lead the industry.

Defensive Strategy:

The Company is always try to keep their unique selling prepositions without being disclosed to their competitors & looks at the ways how the employees are using them. Even the tour operators’ contact details are kept under secrets to minimize ther possible risks.

CRITICAL EVALUATION OF MOTIVATION THEORIES

Abraham Maslow’s Hierarchy of Needs , Maslow, A. (1954).

NOTE: The need theory is exempted from the academic field considering its relevance to the modern days’ applicability. For example, a young tour executive who joint with the Aitken Spence Travels, might reach Self Actualization target over-stepping all other needs, if he really loves to work to a leading travel agency.

Expectancy Theory, Vroom (1964), Porter and Lawler

Appliance: The management of Aitken Spence Travels is using Vroom’s theory of motivation as well. For example, beginning of the peak season employees are given the expectation that if they could perform exceptionally during the coming season, a definite incentive trip in the concurrent season. Having that idea in mind some employees are dedicated towards their job. In the meantime, the management make sure that high flyers enjoying an incentive trip cum a business deal.

Social Learning Theory, Bandura (1977)

Appliance: The Aitken Spence Travels’ management is highly sensitive about the behaviors, attitude & emotions of the employees since the employees are dealing with clients emotions & attitudes. So the exhibition of right attitudes & emotions is always considered as a plus point to their next promotion or the increment.

Two Factor Theory, Herzberg et al (1957)

Appliance: The management is highly concentrated on the availability of both hygiene factors as well as motivational factors considering the significance of them.

McGregor’s Theory X & Theory Y Managers, McGregor (1960)

Although not strictly speaking a theory of leadership, the leadership strategy of effectively used participative management proposed in Douglas McGregor's book has had a tremendous impact on managers. The most publicized concept is McGregor's thesis that leadership strategies are influenced by a leader's assumptions about human nature. As a result of his experience as a consultant, McGregor summarized two contrasting sets of assumptions made by managers in industry;

Theory X managers believe that:

Theory Y managers believe that:

• The average human being has an inherent dislike of work and will avoid it if possible.

• Because of this human characteristic, most people must be coerced, controlled, directed, or threatened with punishment to get them to put forth adequate effort to achieve organizational objectives.

• The average human being prefers to be

directed, wishes to avoid responsibility,

has relatively little ambition, and wants

security above all else

• The expenditure of physical and mental effort in work is as natural as play or rest, and the average human being, under proper conditions, learns not only to accept but to seek responsibility.

• People will exercise self-direction and self-control to achieve objectives to which they are committed.

• The capacity to exercise a relatively high level of imagination, ingenuity, and creativity in the solution of organizational problems is widely, not narrowly, distributed in the population, and the intellectual potentialities of the average human being are only partially utilized under the conditions of modern industrial life.

Theory X and Y Managers (McGregor, 1960)

Appliance: The travel industry is an extremely busy industry, thus most of the employees tend to avoid working. As such most managers & supervisors believe the fact that they should follow X managers theory in order to get the maximum out of their subordinates. So they keep a close eye on the employees. However on the other hand this action has lead the efficient workers to get demotivated over the management. There are not theory Y managers at Aitken Spence Travels (Pvt.) Ltd.

Motivation Techniques available at Aitken Spence Travels

Rewards & Incentives

This is one of the main methods being used by the company. When employees achieve the given target within the allocated time frame, they are recognized by using the "employee of the month program" or by sending them abroad as an incentive.

Training

The Aitken Spence Travels maintain their own training & development unit under the HR department which spends millions annually for the quality enhancement of the employees. These trainings being conducted by professionals in the industry.

Setting a Target

Setting a target during the first month of the financial year & lead the employees to achieve those targets is one of the main motivational methods at Aitken Spence Travels. There is a mid-year review to make sure whether employees are trying to achieve them or not. But, generally, employees are trying to achieve them since it was them who set those targets for themselves.

Job Enlargement

Job enlargement means increasing the scope of a job through extending the range of its job duties and responsibilities generally within the same level and periphery. Aitken Spence Travels use this method for selected high flying individuals as a motivational method. For example, a well performing individual will be given more responsibilities & more tour operators to handle with an attractive salary hike.

Non-financial techniques

Aitken Spence Travels use non-financials techniques to motivate their clients. The non-financial techniques include: free hotel nights, free local & overseas tours, hampers, & other gifts.

MANAGING CULTURAL DIVERSITY AT AITKEN SPENCE TRAVELS

Cultural Diversity at Aitken Spence – Hofstede Model, Hofstede (1980;2005)

The Aitken Spence Travels managers are using Hofstead model to analyze cultures in respect of following factors;

Uncertainty avoidance

Power distance

Institutional collectivism

In group collectivism

Gender Egalitarian

Assertiveness

Future Orientation

Performance Orientation

Human Orientation

Ethnicity

Aitken Spence Travels’ customers being served by a highly diversed workforce. They have operations in Sri Lanka, India, Middle East, Europe, Benelux countries, Far-east countries etc. The company employs hundreds of employees from different countries. It has been a great challenge for the company to manage this workforce without penalizing their cultural norms & values. On the other hand, the management faces many obstacles with the different rules & regulations, especially labor laws available in other countries. It is the responsibility of the Aitken Spence Travels’ management to manage this diversed workforce carefully for the betterment of the business.

CRITICAL SOURCES OF APPRAISAL

"Just as there are multiple standards by which to evaluate performance, there are also multi candidates for appraising performance." (Bohlander.G et all, 2001, p.325) The sources of appraisal are supervisors, peers, team members, subordinates, customers and self. ASTL staff is appraised only by the superiors of the department.

METHODS OF APPRAISAL

Since the early years, the methods of evaluation have evolved with time. The current methods of performance appraisal are classified as measuring traits, behaviors and results. ASTL has adapted the trait, behavioral and results approach. Trait methods approach is designed to measure the extent certain characteristics such as creativity, leadership, initiative and more of employees. Behavioral method provides action oriented information which is the best for development. Results method is measuring the contributions of the employees to the organization. (Bohlander.G et all, 2001, p.333,334) One method of each appraisal method is adapted by ASTL and they are:

PURPOSE OF PERFORMANCE APPRAISAL PROGRAM IN ASTL

There are two main purposes for performance appraisal program and they are:

Development

The performance appraisal is performed to develop its human resources by identifying the individual strengths and weaknesses. This helps to identify training needs for ASTL staff. It recognizes individual performance to provide performance feedback to employees. It assists ASTL staff in goal identification and achievement. This also works in developing soft skills of employees. It is an opportunity created for the staff to identify issues for discussion and eliminate any problems adversely affecting the job holder and his performance.

Administrative

Performance appraisal at ASTL is used as a basis for compensation decisions, as pay for performance is practiced. The performance appraisal determines the high performance employees for promotions and rewards. It identified poor performance staff to decide on layoffs or termination. It allows ASTL to determine the relative worth of a job under a job evaluation program. The results of performance appraisal are used for documents personal decisions and staff retention. Most importantly, the performance appraisal at ASTL influence employee behavior thereby leading to improved organizational performance.

Different Leadership Styles Across Different Cultures in Aitken Spence Travels

According to the management practices of Aitken Spence Travels, three leadership styles are available; autocratic, democratic, & free-rein style.

Autocratic Leadership

The autocratic leadership is visible especially with certain situations, for example, handling a cruise ship or a charter flight at Aitken Spence Travels. This leadership is required when the processes get more complex & when an expert is handling the situation. There could be punishments & rewards according to their performance.

Democratic Leadership

The democratic leadership style is a very open and collegial style of running a team. Ideas move freely amongst the group and are discussed openly. Everyone is given a seat at the table, and discussion is relatively free-flowing. The Aitken Spence Travels use this style when situations change frequently, democratic leadership offers a great deal of flexibility to adapt to better ways of doing things. For example, during the conventions & exhibitions, the management recommends this type of leadership styles.

Free-rein Style

There are situations at Aitken Spence Travels that leaders/managers are hands-off and allow group members to make the decisions. For example, in Europe, the officers appointed to work to the company is not always followed & observed. It totally depends on the trust & mutual understanding that the employees in abroad & employer in Sri Lanka are having.

Stereotyping

Stereotyping is a thought process that organizes beliefs about one group of people and assigns them to everyone in that group. An example of stereotyping would be that you believe that European officers people like working hard, & Indian officers are trying to skip the work as much as possible.

Different Motivation Techniques practice by Cultural Diverse Aitken Spence

It is an obvious fact that Aitken Spence Travels use different methods in motivating the different clients at different cultures. The best method is selected using their cultural values, believes & attitudes. Cultures with high standards of living always prefer outgoing motivational methods targeting the recreational factors. On the other hand cultures with middle standards of living always prefer pecuniary rewards.

A summary of the motivational strategies used by Aitken Spence Travels (Pvt.) Ltd. all over the world is as follows;

The officers at Asian countries like India, China, Japan, Korea & Pakistan are used to use McGregor’s Theory X , McGregor (1960) concept considering the nature of the employees.

However, in Europe, the employees are motivated by using Goal Theory, Latham and Locke (1979) As such the employees are given specific goals to achieve at the beginning of the season.

Cultural Identity & Noise

It is a challenge for Aitken Spence Travels management to manage employees at different countries. Destinations like Maldives & Oman, the company has employed a large number of employees: local & foreign. The employees exhibit different characteristics based on their values, attitudes & perceptions. During such occasions the management prioritize the majority’s value respecting norms of the minority. However, it is not the best practice if the company tries to treat the employees equally.

Cultural Taboos

Cultural taboos can be defined as distinct behavioral patterns adapted by different societies. It can be certain words, symbols, gestures, postures etc, which cannot be understood by outsiders. Certain characteristics can be considered as very friendly in one society, while the same behavior could be an insult in another society. The Aitken Spence Travels faces a huge challenge to cultivate a standard way of behavior within the premises.

Cultural Shock

Aitken Spence Travels use job rotation as a tool to motivate their employees. As such employees are sent to different countries to perform different jobs within the chain. The employees face cultural shock by being in foreign countries & without being able to adapt to certain cultures. The employees at Aitken Spence Travel undergo special trainings which designed to strengthen them.

Performance Management and Employee Welfare & Benefit

ASTL has adapted Strategic Human Resources Management. SHRM generates strategic capability ensuring ASTL has skilled, committed and well-motivated employees it needs to achieve sustained competitive advantage.

The approaches adapted to SHRM are best practice, strategic fit and resource capability. These approaches develop resource capability achieving strategic fit through with a set of superior of HRM practices.

ASTL is using a mixture of Hard and Soft approaches. It ensures the right number of right sort of people are available when needed creating and shaping the culture of the organization. ASTL has applied a proper balance between the hard and soft elements.

ASTL functions as a full business management process with all essential SHRM activities included. These key activities are carried out by the HR staff at ASTL and the functional line managers.

ASTL performs forecasting of demand and supply, and balancing demand and supply. Demand forecasting allows ASTL to estimate the future needs of manpower and their likely skills and competences. Supply forecasting allows ASTL to measure the number of manpower likely to be available within the organization. ASTL brings a proper balance between demand and supply by matching HR requirements with the available HR.

There are quantitative and qualitative methods of forecasting practiced at ASTL

There are job descriptions and job specifications along with employment terms and conditions for each job. The number and categories of manpower has specified the recruitment program.

ASTL seeks internally to replace job opening as it is a means of rewarding its current manpower. So the first consideration is given to the internal candidates.

Selection decisions are wisely based on subjective and objective factors.

ASTL does not believe in this concept of ‘Pay Secrecy’ and does not have the policy to be followed by the corporate.

ASTL takes great effort in appraisal and improvement practices of its staff. Performance appraisal is held at quarterly every Six months and annually.

Recommends 1 - Leadership Strategies for Aitken Spence Travels

Aitken Spence Travels produces tour packages, vacations, cruise trips & air transfers as their core product. Also the company has spreaded its’ products & services in most parts of the globe. Considering the nature of the tourism product, the company should practice all autocratic, democratic & laizze-fare leadership styles. As such, there is no one recommended leadership style.

Recommends 2 - Culture Colliding, Equality & Diversity

Cultural colliding is a challenge to Aitken Spence Travels. The company undertakes different strategies to make sure all employees are treated equally within the company. From the perspectives of the employees, equality in rewarding & promoting are main sensitive factors that they consider as the maintenance of equality.

Recommends 3 - Evaluation of Theories Related to Managing Cultural Diversity

Though Aitken Spence Travel is a well-established company, it is still growing. In order to match with the industry’s growth & company’s growth, the company got to employ a set of employees who exhibit same level of performance. However, different employees from different cultures do not perform similarly at a given situation. So the management has to implement different effective training programmes & workshops to standardize the employees.

Example

The managers at Aitken Spence Travels lead the subordinates inspiring the rest of the workers. The subordinates inspired by managers will follow their path protecting the rights of the rest.

Recommends 4 -Personal Involvement

The managers can personally involve with certain labor matters of the employees thus standardizing their quality of service.

Recommends 5 -Trust

The managers can inculcate a trustworthy culture within the company using personal approaches. A trustworthy culture always enhances the quality of the service & employees’ productivity.

RECOMMENDATION S 6 – HUMAN RESOURCE PLAN

There are no flexibility plans included in the Human Resource plan. This flexibility component will bring greater operational flexibility, avoid compulsory redundancies, increase productivity and reduce employment costs. The HR Department at ASTL may consider including a component of flexibility to the Human Resource Plan.

RECOMMENDATION S 7 – HUMAN RESOURCE PLAN

There is only one employment test adapted in the selection process. It is essential to implement employment tests that meet sensitivity, standardization, reliability and validity. ASTL can achieve the standards required by developing atleast one more employment test as psychometric test assesses job candidates on aptitude, ability and personality.

RECOMMENDATION S 8 – UNIQUE APPAISAL SYSTEM

ASTL staff is appraised only by the superiors. Given the complexity of the jobs at ASTL, it is unrealistic to presume that one person can fully observe and evaluate an employee’s performance.

RECOMMENDATION 9 - Proper Induction Mechanism

There is no proper induction procedure within the company. Once a new executive is hired, he or she has to work under the direct supervision of another senior executive, who is just one year experienced than him. The senior executive tries to train the newly selected employee according to the values& believes that they have.

RECOMMENDATION 9 - Grievance Handling & Employee Turn Over

The employees face different stressful situations within the company that they are working to,for example, working long working hours, irregular hours, working under stressful conditions etc. The managers do not handle such situations properly. As a result the company is having the highest employee turn-over ratio in the travel & tourism industry. Since the HR division is not having a proper Human Resource plan, the managers select whoever they wish to select to the organization. The overall human resource quality decreases eventually.

CONCLUSION

Present, companies in tourism & hospitality industry are increasingly employing employees from different culture & from different backgrounds in order to cater the diversed demands of their clients. Thus managing that workforce has been a real challenge to the management since one standard policy won’t work for all. As such companies have established different leadership styles to manage their employees. On the other hand, tourism & hospitality is a sensitive industry where the employees are supposed to exhibit right emotion at the right time. Without cornering the employees to face emotional dissonance the managers have to control their behavior. Since the products & services are produced & consumed simultaneously, the managers have to exhibit different leadership traits when managing the employees.

Basically we can define motivation as the inner power or energy that pushes toward acting, performing actions and achieving. Motivation has much to do with desire and ambition, and if they are absent, motivation is absent too. In order to get the maximum out of the employees, the employees should be workaholic & goal oriented. As such managers have to implement different motivational theories when employees are from different backgrounds & culture. The underlying argument is, one motivation method will work for one or many employees, but not for all.

List of Reference

www.aitkenspence.com , Access on November 02, 2012

http://psychology.about.com/od/leadership/a/great-man-theory-of-leadership.htm

Personal Interviews:

‘Human Resources Manager Aitken Spence Travels, October 22, 2012’

Bibliography

ASTL – Aitken Spence Travels Ltd

HR - Human Resources

HRM - Human Resources Management

Text Book

Connerley, M. L. and Pedersen, P. B. (2005) Leadership in a Diverse Multicultural Environment: Developing Awareness, Knowledge, and Skills. London: Sage Publications.

Deresky, H. (2003) International Management: Managing Across Borders and Cultures. 3rd ed., London: Prentice Hall.

Hofstede, G. & Hofstede, G.J 2005. Cultures and organizations: Software of the mind. New York: McGraw-Hill.

Herzberg,F. Work and nature of man. World Publishers: 1966.

Maslow,A 1954, Motivation and personality. New York: Harper & Row

McGregor, D. 1960. The human side of enterprise. McGraw-Hill

Miles, A.K 2000. The ergonomics and organizational stress relationship. Dissertation

Cattell, R.B. (1965). The scientific analysis of personality. Baltimore: Penguin Books.

Journal

DeShields,O., Kara, A., Kaynak. 2005. Determinants of business student satisfaction and retention in higher education. Applying Herzberg’s two-factor theory. International Journal of Educational Management, 19:128-139.

Brislin,R, MacNab, B., Worthley, R., Kaibigting, F., & Zukia, B. 2005. Evolving perceptions of Japanese workplace motivation: An employee-manager comparison. International Journal of Cross Cultural Management : CCM, 5:87-104