Management Issues in Hilton Hotel Sydney

This report analyzes the management issues in Hilton Hotel Sydney, specifically the high employee turnover rates in the front office department. It discusses the importance of understanding the root problem and provides recommendations for improvement.

Running head: INTRODUCTION OF MANAGEMENT
INTRODUCTION OF MANAGEMENT
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Executive Summary
The purpose of this report is to analyze a current management situation and come up
with a detailed discussion on why it is an issue and how it could be made better. This report
takes the case of Hilton Hotel Sydney, which has been going through a phase of high
employee turnover rates especially in the front office department. The report finds that
managers have not looked deep into the matter and have only strategized according to
feasibility, when the actual move should have included a thorough study about the nature of
the problem. The report discusses the importance of understanding the nature of a root
problem, and how to do that effectively.

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Table of Contents
Introduction................................................................................................................................3
Findings......................................................................................................................................3
The decision making process.....................................................................................................4
The problem...............................................................................................................................5
Improving decision making skills..............................................................................................5
Why managers falter..................................................................................................................6
The crucial step..........................................................................................................................7
Conclusions and recommendations............................................................................................7
References..................................................................................................................................8

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Introduction
Hilton hotel Sydney, has been going through an ongoing problem of making
employees stay, especially in the front office department of the hotel. As a result, there has
been high turnover rates in the hotel, which in turn has cost the hotel in thousands of dollars
over the last couple of years, as a result of training costs (Rutherford & O’Fallon, 2017). The
management department of the hotel has tried out numerous strategies as of late, to ensure
that the turnover rates are minimized. Although the turnover rates have gone down in the last
few months, it still does significantly exist (Gyimah, 2016).
This report is prepared through undertaking an extensive qualitative research from
various academic and business journals, with the purpose of identifying the key issues which
the management has failed to look into, which has given way to the high turnover rates in the
hotel. As a result, the scope of this research aids any management team who have been
suffering from the same issue in their organization, and since the issue of turnover is
dominant across organizations, the scope of this research too, is vast. The research has been
done, based on secondary data analysis.
Findings
Hilton hotel Sydney has been in the business journals in the recent times for an
undesirable reason, which is of high turnover rates in the organization. The front office
department of the hotel has been the main department in the hotel which has witnessed the
highest levels of turnover rates. To be exact, 40.76% of the front office workforce quit the
organization within 20 months of joining the organization (Dardeer, Tag-Eldeen & Salem,
2017). This has been of serious concern for the front office management of the hotel and for

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the organization altogether because this has cost the company over a $100,000 in the last two
years, in the form of training costs (Guchait, Paşamehmetoğlu, & Madera, 2016).
Staffs have reportedly listed a range of reasons for leaving the organization, which
includes low payments, a poor organizational culture, commutation problems and even
inhumane work pressure (Guchait, Paşamehmetoğlu, & Madera, 2016).
To counter this, in an effort to reduce and minimize the rates of turnover in the front
office department, the management team has come up with reforms in the organizational
culture, to create a very friendly and peaceful working environment for the staffs of the hotel.
According to Jaworski et al. (2018), the decision was made with the assumption that having a
good organizational culture and letting employees be happy at work, would balance out the
other negatives. Although this has been successful and the rates have dropped over the last
year, the issue still does exist. This is primarily because of the fact that firstly, the
implementation of the sudden plan did not go down well with the senior employees in terms
of adaptation, and secondly, there were numerous problems which the hotel had been facing
and the management only decided to improve one of such situations (Jaworski et al., 2018).
The other existing issues largely outweigh the little benefits gathered from the cultural
reforms.
The decision making process
The decision making process which the hotel took, firstly involved identifying the
root problem. The root problem here was the high turnover rates in the front office
department of the hotel. The next thing which they did was to gather information. They asked
every resigning employee about the problem they faced in the organization to get insights
into the issue. This left them with a range of reasons why employees in the department have
been leaving the organization as of late. This led to the next stage, which was to identify the

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alternatives. The management department of the hotel ensured that alternative actions were
listed which could address the problems identified. The next step was to make sure that the
alternatives were feasible enough for the hotel. They could not simply raise the salaries of
every employee since that would not be financially feasible. They could obviously neither get
cars for every employee to aid them in commutation. In this way, every alternative was
weighed out in terms of feasibility, and the most feasible one, which was to make reforms in
the work culture, was chosen, as it involved little to no expenditure. Then the implementation
was done. This was rather sudden and desperate, to get rid of the situation before another
employee resigns. This sudden change did not go down with bosses and team leaders, who
have been habituated to leading in an authoritative manner. The reviewing of the decision
thereby proved, that the implementation was weakly effective (Gyimah, 2016).
The problem
As it can be already understood in this context, the main problem with this
management decision is the fact that it hardly took every listed problem in the issue while
making the decision. It can be clearly understood that the main thing which happened is the
fact that focus was predominantly on feasibility and less on coming up with an actual strategy
which would be able to make sure that turnover rates could be minimized by addressing each
of the problems listed by resigning employees. The fact that a single strategy had to be
formulated which would be feasible and would address all of the problems, lacked focus in
the decision making. The profitability of the future as a result of low employee turnover rates
and saved costs on training, was sacrificed for the profits of the present.
Improving decision making skills
In such situations, one has to understand the concept of expectancy theory. This
theory suggests that people only tend to put in efforts and continue to do so for as long as

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they are psychologically rewarded with something more (Purvis, Zagenczyk & McCray,
2015). In other words, people put in efforts for as long as they feel that what they are getting
in return has a value more than that effort (Flake et al., 2015). This is why decision making
skills could be improved by understanding the psychology of the employees. One problem
could have several alternatives, and managers often to go with the most cliché ones. This
could be improved if the nature of the problem is studied thoroughly to know what the
problem requires, instead of assuming what the problem requires.
Why managers falter
Managers falter at times during decision making processes because they fail to
understand the nature of the problem precisely. For example, in this case study, the managers
thought that having a good working environment would balance out the negatives, when a
more strategic approach would have been to offer performance incentives and adjust salaries
to accommodate transportation allowances, apart from the implemented strategy. This is not
only feasible, but also covers all of the problems that give rise to the issue of turnover in the
hotel.
Another reason why managers falter is because of the fact that they focus more on
current profitability concerns, than what they could achieve if investments are done for
sustainable profitability. The Wells Fargo case is a perfect example how ignorance on
investing for ethical business simply because of the costs, led to the loss of millions of dollars
for the bank due to unethical business practices (Elson & Ingram, 2018).
From my point of view, I would have made a decision that would address all of the
major problems which employees complain of while leaving the company. Firstly, an
alternative should have been designed to serve all of the problems, and then the feasibility
test should have been done. Furthermore, I would have conducted a workforce survey to get

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insights into the demands of the employees, which would help in designing an alternative to
serve the root problem.
The crucial step
Perhaps the most crucial stage in the decision making process was the gathering of
information, where the management faltered. This is why information was gathered in a way
which only answered “what”, and not “why” or “how”. This is crucial information and is
essential for formulating alternatives. Feedback should have been taken on how they wish the
hotel could improve so that they could consider staying back. This would have probably done
half of the work of the management department.
Conclusions and recommendations
From the above discussion, it can be concluded that the Hilton Hotel Sydney has been
going through a tough phase in employee retention and although it has tried to address this
issue, it has not been very effective. The main problem lies in giving more focus to feasibility
than on sustainable development. The nature of the problem has not been identified properly
and that is why the management has come up with a desperate and vague move to suddenly
the organizational culture in the hotel. On the basis of expectancy theory, employees feel like
what they are putting in, is far less than what they are benefiting out of it, and hence, are
leaving the organization.
Following are the recommendations for the manger of front office of the hotel:
 Conduct a survey to find out what exactly the employees want and how happy they
are with each aspect of the work that they do.
 Ask resigning employees what could be made better for them to stay back.
 Design alternatives to suit the situations rather than to rely on cliché alternatives.

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 Weigh out future profitability against current feasibility while analyzing alternatives.
References
Dardeer, M., Tag-Eldeen, A., & Salem, I. (2017). The Influence of Physical Work
Environment on Hotel Back-of-the-House Employees’ Satisfaction and Productivity:
A Case Study on Hilton Hotels. JOURNAL OF TOURISM. RESEARCH, 43.
Elson, R. J., & Ingram, P. (2018). WELLS FARGO AND THE UNAUTHORIZED
CUSTOMER ACCOUNTS: A CASE STUDY. Global Journal of Business
Pedagogy, 2(1), 124.
Flake, J. K., Barron, K. E., Hulleman, C., McCoach, B. D., & Welsh, M. E. (2015).
Measuring cost: The forgotten component of expectancy-value theory. Contemporary
Educational Psychology, 41, 232-244.
Guchait, P., Paşamehmetoğlu, A., & Madera, J. (2016). Error management culture: impact on
cohesion, stress, and turnover intentions. The Service Industries Journal, 36(3-4),
124-141.
Gyimah, S. (2016). Speech: Sam Gyimah: vision for early years workforce and Millie’s
Mark: 4 July 2016, National Day Nurseries Association Conference, Double Tree
Hilton Hotel, Milton Keynes.
Jaworski, C., Ravichandran, S., Karpinski, A. C., & Singh, S. (2018). The effects of training
satisfaction, employee benefits, and incentives on part-time employees’
commitment. International Journal of Hospitality Management, 74, 1-12.

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Purvis, R. L., Zagenczyk, T. J., & McCray, G. E. (2015). What's in it for me? Using
expectancy theory and climate to explain stakeholder participation, its direction and
intensity. International Journal of Project Management, 33(1), 3-14.
Rutherford, D. G., & O’Fallon, M. J. (2017). Hotel management and operations. John Wiley
& Sons.

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