The reason which has a major contribution in the failure of MNCs in host countries is lack of cross-cultural awareness (Ybema et al, 2011). Primarily, culture is considered to be a source to enhance internal integration and link, but it has been found that in the open system of an organization, culture is also very important for adjustment to the environment (Schein, 2010). The adjustment to the culture of host country is also significant to facilitate innovation, accept new ideas and concepts and to bring required change in culture of organization (Lebow, 2009).
Hotel Hilton is famous all around the world as pre-distinguished company for accommodation in hospitality industry. In China, it is a well-established hotel which offers its visitors and customers with the best quality accommodation and value to get leisure or any other business purpose. Hotel Hilton gives its customers different experiences which include center hotels, stay with extension, affordable priced services, various resorts and airport hotels.
Conrad Hilton established Hilton Hotels in 1919. Now there are about 2,645 hotels of Hilton which have more than 485,000 rooms for its visitors. All around the world, there are about 135,000 employees working in Hilton Hotels. Hilton hotels are adopting those strategies through which they can fulfill the recent needs of visitors and also potential needs of future generations. The annual aims and objectives of Hilton hotel are set according to the last year’s outcomes and performance. Hotel Hilton first time started its operations in China in 1988. It opened the first hotel with named Hilton Shanghai. Now there are total 27 Hilton Hotels working in China within five years (Www3.hilton.com, 2015).
The aim of Hotel Hilton, China is to set a high standard in the department of human resource management and creating a culture in which everyone can get the chance of growing and developing their careers (Zhu, 2015). It is also trying to expand in those areas where they never operated before. The HR strategy of any organization includes a philosophy through which the management can easily manage the people working within the organization (Yip, 2002). There is a need of policies and strategies for employees in order to make them integrated. This helps the organization in integrating the HR strategies with the organizational strategy. A detailed HR support is offered by Hilton in order to manage various properties (Vassalou, 2005). This involves detailed review of HR systems and policies for ensuring corporate and governmental consent, administration of compensation, relationship among team members, and management of risk, training of employees, ER systems and proper planning of workplace. The HR management team of Hotel Hilton is focused for pursuing the excellence in each area in order to enhance the satisfaction and loyalty of team members (Sharifian, 2014).
In order to make the organization successful, it is important to keep issues of employees at the fore front of their decisions making and other planning. The management of Hotel Hilton, China believes that only those employees can add value to the organization who also feels valued. Behind any decision making, the management of Hotel Hilton keeps this ethos. As, Hotel Hilton has started its operations in China which is host country for it, so, it is very important for it to understand the culture of China. An organization can become successful when it has a distinct organizational culture. Organizational culture is described by Scullion and Linehan (2005) as the particular collection of various norms and standards which are shared by every individual working within that organization. The organizational culture is something through which the way of interaction between internal and external stakeholders is controlled. At Hilton, there is a culture which makes its employees feel like they are a part of this family.
The organizational culture of Hotel Hilton is that which supports its employees to feel like working at their homes. The success of hotel is mainly due to the skills, expertise and commitment of employees. Hotel Hilton focus much on giving various benefits to its employees in order to make sure that they can be used as a source of competitive advantage. The management of Hotel Hilton has introduced a program named as Esprit. This program assists employees in developing their skills with the help of continuous evaluations and rewards to improve their expertise. This helps the hotel management of Hilton in China to increase the satisfaction level of customers. The hotel management implements those HR strategies which are compatible with the local employees of China. The whole culture of organization is according to the local culture of China, in order to satisfy the employees as well as local visitors who come from China (Negru, 2010).
Hotel Hilton is focussing much on hiring and training more employees and ensuring standards. The management of hotel focuses much on culture through which team members can deliver services through which expectations of guests can be met. The management of Hotel Hilton in China hires employees from China so that they can understand the needs of local customers. The management also gives an opportunity to employees from countries other than China to get training from local employees.
The management of Hotel Hilton focuses on adapting the cultural norms and standards of China but it also keeps its own standards and practices through which its guests as well as team members can get benefit. The strategic perspective of hotel is that as a brand it makes a promise to visitors which it must deliver on a continuous basis. In addition to this, the hotel strives to be culturally relevant. In case of food and beverages and other leisure activities like spa offerings in China, there are differences with respect to culture. For example, in China the menus involve those dishes which are according to the expectations of local guests. The management of Hotel Hilton in China has found that the guests of China feel comfortable with those employees who are fluent in Mandarin.
Hotel Hilton has implemented ER system in hotel in order to reduce the cost of operation by making the processes automatic. This has helped the hotel in increasing the security at hotel. In China, the hotel has implement ER systems for managing its supply chain. This helps in ensuring that raw materials do not get wasted. It helps the hotel in immediate tagging of inventory. The guests of hotel are provided with the secure keys through which they can easily adjust the room temperature. Recently the management of Hotel Hilton installed a new ERP with cost of $4 million. This helps the hotel in increasing the efficiency of processing by a factor of six. In this way, the hotel has become able of saving $4.5 and $5 million per year (Alvesson, 2002)
2.2. HRM & ER System at IBIS Hotel
Ibis is leading budget hotel with even more than 950 hotels in 55 countries; ibis provides its customer with highest service level and comfort in its category at the perfect prices of marketing. The ibis standard makes its customers sure all around the world provide homogeneous: an advanced room, linked and soundproofed bedding to comfort, a varied cuisine and breakfast from 4am to noon (Shaul and Tauber, 2012). In such comfort the ibis room: became fully equipped, comfortable and modern, every hotel in the network, the ibis room is being designed to provide its consumers an ability to work with peace and happy sleep: linked with the Wi-Fi of hotel, work desk and wide bathroom, soundproof and a flat-screen LCD TV. Staff and managers from all of the hotels of ibis do a get together every year in order to renew and refresh the knowledge of service. By acting out various conditions the staff learns new strategies and share experiences that can occur in case of new encounters, like when guests come from various cultures (Woodside, 2012). The staff is diverse with backgrounds from various areas of the world at Ibis Hotel Kista, which is situated in a culturally diverse areas, the staff is diverse with backgrounds from various parts of world like Iran, parts of Africa and England. Along with fluency in Swedish and English, the new demands are two years experience within restaurant or hotel industry. The cultural diversity among staff is not considered as compulsory, only a good and beneficial attribute. The various backgrounds of the members of staff were not seemed in the process of hiring. Like the hotel of Ibis Alranda, the major target is that staff should be unified. The hotels of Ibis target to provide good services to the guests, and it is of no significance that where they emerge from or what is their cultural background. The target to provide the best service has provided the front staff the power to assist guests with particular requests. Sometimes, it originates from the culture of guests, but it is not considered important. The front staff recognizes it as a special request, and does whatever is important for the satisfaction of the guest (Thakore, 2013).
The scope of ERP of IBIS implies important alteration to work exercises and processes of staff. Basically, three types of services are present to assist the implementation of these changes – support, customization and consulting. Time of implementation is based on the scope of process changes, customization, and number of modules and the availability of the consumer to take ownership of any project. Modular ERP systems are being implemented in stages. The project for a wider enterprise takes almost 14 months and demands almost 150 of the consultants. Small projects of ibis required months; multinational and some large implementations require years. Customization enhances the times of implementation (Briscoe and Schuler, 2004). ER system has improved efficiency and quality of IBIS. By keeping the internal business of the organization running, ERP has led to even better outputs that helped ibis, like manufacturing and customer service. ERP has supported the upper level management of IBIS by giving them information for the process of decision making. ERP has made ibis even more agile that adapts better to the advancements. ERP has made it less rigid and more flexible so the components of ibis are operating more cohesively, increasing the business – externally and internally. ERP has improved the security of the data. ERP has given enhanced opportunities for the collaboration. Data has different forms in the advanced enterprise like emails, video, audio, forms, files and documents. Often, every medium of data has its own mechanism to allow collaboration. ERP provided a collaborative platform to ibis that let the employees to spend more of their time collaborating (Schuler and Jackson, 2006).
There are three approaches which can be used by organizations to manage and staff subsidiaries which include ethnocentric approach in which expatriates are used on important positions second is polycentric approach in which local employees are used and last is geocentric approach in which local nationals, expatriates and third country nationals are used (Brewster, 2007).
Both the Hilton Hotel and Hotel IBIS have expanded their operations in various countries. Both hotels are operating in China.Hotel Hilton has used geocentric approach in which it has focussed on combination of both from headquarters and subsidiaries for developing consistent practices. The manager of hotel is selected on the basis of competency. No focus is given on nationality. This helps in implementing both universal as well as local standards to evaluate and control. In contrary to this, Hotel IBIS has implemented polycentric approach. It focuses on hiring more employees from local country i.e. China and all the supervision is done by local manager. There is very less involvement of headquarter in strategies of subsidiaries. There is less communication between local managers of subsidiaries and headquarters.
The Hotel Hilton has an approach of providing costs and service models through which the complexity, size and environment of business can be reflected. The hotel focuses on maximizing efficiencies of cost and scale, to share best practice and ensure proper affordability. The hotel focuses on optimizing market share of hotel and giving results which can beat the market. The Hilton hotel focuses on understanding hospitality industry of every country and implementing appropriate strategies in each country. The hotel focuses on providing diverse levels of involvement based on the needs of hotel, confirming that hotels are completely involved in decision making.
From the above analysis, it can be concluded that in order to expand internationally, it is very important to understand the cultures of other countries. The HR department of organization manages the employees of local as well as international country. Both Hotel Hilton and Hotel IBIS are focusing much on managing the employees hired from host country. This helps the hotels in meeting the demands of local guests. Hotel Hilton and Hotel IBIS has implement ER system for managing employees and customers. In order to expand internationally, Hotel Hilton has used geocentric approach according to which it has focused on hiring employees both from home as well as host country. Hotel IBIS has adopted polycentric approach according to which it has implemented strategies according to host country.
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