Cavendish Hall Hotel Case Study On Improving Performance Level

Question

Task: Discuss the rationale for using EITHER performance related pay OR performance appraisals to improve performance levels at the Cavendish Hall Hotel and the role of the line manager in achieving this successfully.

Guidelines
Your response should consider:

• How and to what extent performance appraisals OR performance related pay might improve organisational performance (in ‘theory’ and in ‘practice’).
• The characteristics of effective and ineffective appraisal OR pay design and
• The reaction of employees to the performance review OR pay process.
• The ability, motivation and opportunity of line managers to design and implement the appraisal OR pay process effectively.

Due to the reflective elements in this assignment you may write in the 1^st person when illustrating your answer with examples from your own experiences.

All answers must be between 1000 and 1,500 words long.

Assignment Case Study
Daphne Jones has recently been appointed as HR manager of the Cavendish Hall Hotel, a 200 bedroom, four-star county house hotel, located in rolling hills a few miles south of a major northern industrial conurbation. The hotel provides a wide range of conference and banqueting facilities and is a popular wedding location. It employs a range of full time, part time and temporary seasonal staff across 5 departments: Events and Banqueting, Rooming and Reception, Housekeeping, Food and Beverages, HR and Administration. The organisation aims to be “The region’s number one venue choice for events and conferencing”. They aim to deliver through a strategy of personalised customer service experience, bespoke events packages, competitive pricing and an outstanding accommodation and restaurant experience.

The hotel operates a formal annual appraisal scheme which, as part of a new performance management system, has been linked to an individual performance related pay scheme. Each member of staff receives a one per cent salary increase irrespective of performance to take account of the increased cost of living. The hotels line managers must then assess each member of staff in their team as either Excellent, Good, Satisfactory or Unsatisfactory based on their individual performance over 12 months and this is used to determine any further pay rises.

An interim appraisal review is also conducted after six months. The purpose of this review is to focus on the career aspirations and learning and development requirements of employees. These are conducted by the same line manager who is responsible for feeding back relevant information to the HR department to help form the hotels talent development strategy.

Despite the scheme the hotel manager has discussed ongoing performance problems with Daphne. The hotel has received some poor reviews from guests concerning levels of customer service and room cleanliness on Trip Advisor UK:

“The staff try hard but lack the professionalism of a 4/5 hotel to compete. I will stay in the hotel over the road next time as much better value for money in my opinion.”

“Yesterday I forgot my key. After running miles to the reception, they gave me another key which still didn’t work. No fresh orange juice at breakfast.”

“Booked four nights for a very special occasion but checked out after two truly disappointing days. Service was not friendly or prompt. Our room had a flickering bathroom light that was never replaced.”

“I was surprised that standards have slipped so much. Staff are no longer friendly and ’on the ball’. I couldn't relax in my room as I was repeatedly interrupted by staff checking the room. Indifferent service in the bar, very slow checkout caused by only one member of staff being available to serve many customers. When an extra member of staff did appear to help with checkout and I mentioned the long delay she commented that she was busy on the phone.”

Perhaps unsurprisingly given these reviews, the hotel is also suffering from declining room occupancy rates which is now attracting negative attention from head office.

As a starting point to her investigations, Daphne has reviewed the latest employee engagement survey and has noted some apparent problems. In particular, Daphne has noticed that the engagement scores from the hotel rooming and reception department are lower than in the rest of the hotel. The scores for this departmentare also worse than in the previous year’s survey. 

The divisional manager tells Daphne he was involved in the appointment of an ambitious new manager to Rooming and Reception approximately 3 months ago. They have good hotel experience, working previously as a receptionist for three years, followed by 2 years as a team leader/supervisor in events and banqueting. He tells Daphne he has been pleased with this new manager’s progress. They are able and energetic and have already improved the efficiency of their work section by quickly re-organising some of the procedures and improving the methods used in the department.

Daphne checks the HR records and sees that paperwork has been returned indicating that this manager has completed the annual appraisals on all of his staff on time and she notices that they have all been set the same objectives around accuracy on paperwork and computer booking processes. While there are entries in the appraisal paperwork in the section on development there have been no requests for training and development from the department according to her training administrator. Checking the key HR metrics for the department she also notes that sickness absence in this department has increased well above the hotel average. On average the department has lost 8 days per year to sickness absence compared to 5.3 in the hotel as a whole.

Daphne presses the Divisional Manager for more information about the young manager and he tells her that, on reflection, he walks around the department whenever he is in the hotel and on several occasions he has passed by the manager talking to staff members and noticed the tone of their voice was sharp. Now he thinks about it, on a couple of occasions he thinks some of the staff members might actually have looked upset. He has also over-heard conversations between staff members where the manager’s name has been mentioned in connection with bad attitudes. Just the other day an accounting clerk made some harsh comments about the manager’s attitude and complained about the way he had spoken to her when he identified an error in her banking paperwork. He says he has observed the manager holding morning meetings with his team but these seem to be quite short and focused on the allocation of tasks for the day.

Answer

1. Introduction
The report is based on the critical analysis of Cavendish Hall Hotel case study. One crucial responsibility of the human resource management is performance evaluation and ensuring presence of appropriate remuneration system. In this context, it is noteworthy that selecting and implementing appropriate remuneration system is crucial, which could empower employee’s contribution, while improving their overall performance. However, this is directed by different contextual factors. Different companies are using different strategies and tools for improving employees’ performance, including “performance related pay” or “performance appraisal”, which are selected based on organizational structure, culture as well as other contextual factors (Akinbowale, Jinabhai & Lourens, 2013). Both types of strategies have some benefits on employee’s performance. The following assignment is going to determine the most suitable one for the case of Cavendish Hall Hotel, discussing rationale behind it. Further, in the Cavendish Hall Hotel case study analysis, the role of line managers in designing and implementing the particular strategy is also going to be explored here, considering their role as inevitable for employees’ performance improvement. 

2. What are the issues highlighted in the Cavendish Hall Hotel case study?
Before ensuring which one of the two methods (performance related pay or performance appraisal) should be used to improve performance level of Cavendish Hall Hotel, it would be important to find out existing issues.

Issue 1 (Lack of Employee Motivation): In Cavendish Hall Hotel, in terms of hearing out the decisions of the employees, only 29% employees of rooming and reception department stated that their opinions are heard. According to Nelson, (2017) if employees are not included in decision making then they will feel de-motivated and it will hamper their performance. The same thing is happening in Cavendish Hall Hotel. Besides, employees receive no recognition or praise.

Issue 2 (Lack of development opportunities): Performance appraisal is conducted in Cavendish Hall Hotel however, no further steps are taken based on the results; such as training and development. Performance appraisal is always connected with training and development of employees (Ikramullah et al., 2016).

Issue 3 (Lack of communication and employee engagement): In spite of the presence of a new manager with years of experience, he never communicated or engaged with employees in terms of discussing about their progress. It shows poor managerial and leadership skill of the new manager.

3.1 Performance Appraisal improving organizational performance
Both the performance appraisal and performance based pay are beneficial for employees. However, considering the Cavendish Hall Hotel case study, performance appraisal has been selected as the most effective one for improving employee’s performance. This strategy is beneficial for both the organization and individual employees, as revealed by Saeed and Shah (2016), Performance appraisal is a systematic evaluation, which enables the leaders and managers to review the job performance of employees regularly or at a pre-set interval, to assess their overall contribution to the organization. In the following manners, performance appraisal is improving the organizational performance:

Increasing job satisfaction – Performance appraisal involves not only the monetary benefits, rather based on the performance improvement and contribution, employees get hike in designation too, which enhances their satisfaction, while empowering them to contribute more to the organization.

Improving loyalty of employees – Based on the evaluation of employee’s performance, they get training and development sessions, addressing loopholes in their practices. As the employees feel that they are being valued in the organization, they become loyal (Akinbowale, Jinabhai & Lourens, 2013).

Increasing overall productivity – The overall productivity of the organization improves, as the employees’ skills and competencies are improved through continuous training and development sessions, which they get after identifying loopholes in their practices through evaluation.

Employee development – Through appraisal, besides evaluation of employees’ current performance, their potential for future development is also identified, which empowers employees to engage in development programs, which further promotes their skill set and organizational performance (Saeed & Shah, 2016).

In my workplace, performance appraisal system was implemented, which improved both the overall productivity, as well as the satisfaction level of the employees. In one hand, it is clear from the Cavendish Hall Hotel case study that the quality of work improved, customers’ experience was improved; on the other hand, the turnover rate of the organization also reduced, as the number of loyal employees increased.

3.2 Characteristics of effective and ineffective appraisal
The effectiveness of a performance appraisal system can be characterized through some particular points outlined from the Cavendish Hall Hotel case study. For instance, an effective performance appraisal should have the following aspects.

• The performance appraisal system possesses clear objectives
• The performance appraisal system involves valid and reliable data
• The performance appraisal system defines clear and well defined performance criteria
• The system is economical and consumes less time
• It should be easy to follow, avoid complexities
• It must initial follow up
• The procedures and regulations involved, are standardized
• Appraisal system involves training and have job-relatedness
• Feedback and participation are crucial elements (Banerjee, 2020)
• There should be mutual trust between trainers and trainees
• The system should identify and consider differences among employees

In comparison, a performance appraisal system lacking the above mentioned factors, are characterized as ineffective. Some factors which make the systems ineffective include lack of constructive feedback provision, unfair evaluation and lack of clear mutual objectives.

3.3 Reaction of employees to the performance review
Cavendish Hall Hotel case study have highlighted that employees showed high level of commitment, as soon as they find link between performance appraisal and employee development. However, lack of information or awareness about the benefits of performance review system often makes existing employees demotivated, as they finds the system as additional burden, which brings change in the organizational practices (Jain & Jain, 2014). However, it is noteworthy in my organization, effective leadership and transparent communication with the employees, helped them to understand the benefits of performance review, which further showed positive reaction of employees and improved satisfaction.

3.4 Responsibility of the line managers
The critical evaluation on Cavendish Hall Hotel case study illustrates that in performance appraisal the main responsibility of the line managers is to ensure performance appraisal takes place with all the employees (Longenecker & Fink, 2017). They also make sure that training and development sessions remain linked with organizational mission and vision and employees can learn new skills through this.

4. Improving Performance levels at Cavendish Hall Hotel
From the issues that are identified from the given Cavendish Hall Hotel case study, it would be better to implement performance appraisal process for Cavendish Hall Hotel in the workplace. Right now, there is a scheme activated in the organization through which employees are enjoying salary increase of 1% irrespective of performance. This is actually a good initiative as it will help the employees to stay motivated and to improve their performance. However, from the collected data it can be seen that employees of rooming and reception department are suffering from poor performance due to several reasons such as not collecting opinion of the employees, lack of encouragement, lack of communication about progress and lack of opportunities in terms of learning and growing at the workplace. On the other hand, the new manager of this department also does not seem to work well with the employees or does not seem to understand their issues. As a result, very low morale exists within the organization.

Previously it was found that performance appraisal helped my organization to improve performance of its employees within a short amount of time that also improved the performance of the organization. Thus, performance appraisal will be the right strategy for Cavendish Hall Hotel. First of all, performance appraisal must be done of the new manager who is recruited. Employees of rooming and reception department are not happy about the manager’s attitude and behavior and thus it would be important to find out in which skill or capability the manager is lacking. From the Cavendish Hall Hotel case study it can be assumed that the manager is lacking in terms of emotional intelligence as he is failing to control his emotions. However, based on the performance appraisal the new manager will be asked to change his attitude or will be asked to improve particular skills of him (Dipboye & Dipboye, 2018).

Performance appraisal of the employees in rooming and reception department will be done and this time the results will be connected with training and development programs. The analysis on Cavendish Hall Hotel case study signifies that the hotel will collaborate with a third party organization specialized in training and development programs. That organization will communicate with Cavendish Hall Hotel and will ensure that proper training sessions are developed to train employees and to improve their skills and competencies in terms of the service that they provide to the customers.

Line managers will play a major role in this process and their responsibilities are hereby shown in the table below.

5. Conclusion
Based on the Cavendish Hall Hotel case study, it can be concluded that the decision of implementing performance appraisal can be very useful for the hotel and its employees. The skill of the employees is not sufficient to provide expected customer services and in this condition performance related pay will not work. However, Cavendish Hall Hotel will have to do this performance appraisal at last twice a year for better results in the place of once a year.

Reference List
Akinbowale, M. A., Jinabhai, D. C., & Lourens, M. E. (2013). The impact of performance appraisal policy on employee performance–A case study of Guaranty Trust Bank in Nigeria. Mediterranean Journal of Social Sciences, 4(14), 677.

Banerjee, A., (2020). characteristics of Effective Performance Appraisal System. Cavendish Hall Hotel case study Online. Available at: http://www.preservearticles.com/management/10-characteristics-of-effective-performance-appraisal-system/29793 [Accessed on: 24th February 2020]

Dipboye, R. L., & Dipboye, R. L. (2018). Criterion Development, Performance Appraisal, and Feedback'.

Ikramullah, M., Van Prooijen, J. W., Iqbal, M. Z., & Ul-Hassan, F. S. (2016). Effectiveness of performance appraisal. Personnel Review.

Jain, S., & Jain, R. (2014). Employee reactions to performance appraisal system in Indian banks. The Indian Journal of Industrial Relations, 576-589.

Longenecker, C., & Fink, L. (2017). Lessons for improving your formal performance appraisal process. Strategic HR Review.

Nelson, B. (2017). Engaging employees today: More than just measurement. Cavendish Hall Hotel case study Leader to Leader, 2017(85), 54-58.

Saeed, S., & Shah, F. M. (2016). Impact of performance appraisal on employees: Motivation in Islamic banking. Oman Chapter of Arabian Journal of Business and Management Review, 34(2646), 1-8.