The Role of Human Resource Management in Customer Retention

This report investigates the critical role of Human Resource Management (HRM) in customer retention, focusing on a case study of Holiday Inn Hotel in London. The research delves into the concept and significance of customer retention for organizations, identifying specific practices employed by Holiday Inn to improve customer loyalty. It examines the direct impact of HRM on acquiring and maintaining customers, including demonstrating personalized customer service and maintaining consistent communication. The report also explores the relationship between HRM strategies and customer retention rates within the hotel industry, providing a comprehensive analysis of how employee training, service quality, and customer feedback mechanisms contribute to long-term customer relationships. The methodology involves a quantitative research approach to gather measurable data, underpinned by a positivism research philosophy to ensure quantifiable observations and reliable outcomes.

Research Project

Contents
INTRODUCTION...............................................................................................................................3
LITERATURE REVIEW...................................................................................................................4
RESEARCH METHODOLOGY.......................................................................................................7
DATA ANALYSIS & FINDINGS......................................................................................................9
RECOMMENDATION.....................................................................................................................20
CONCLUSION..................................................................................................................................21
REFERENCES..................................................................................................................................22

Title: To examine the role of human resource management in customer's retention” -
Holiday Inn Hotel, London.
INTRODUCTION
Human resource management is considered as a crucial activity that is based on
recruiting, managing, training people with the aim of attaining all the set goals and objectives
in stipulated time frame. As human resource plays a significant role in business organization
as they contribute in attaining higher success. This is the reason that proper management of
human resource is essential as it contributes in improving performance level of company and
its workers as well. In this HR manager also focus on managing employees’ activities at
working area by proving them better guidance so that they can easily perform their task and
activities as well (Cascio, 2014). In addition of this, HR manager also responsible for
preparing HR practices to invite skilled and talented workers who are able to effectively
perform their task and at the same time also handle customers activities. This can be
beneficial in improving customers satisfaction and also retain them for longer period of time.
With the assistance of this, company can capture larger marker share from its competitors.
Current research is based on Holiday Inn, is one of the famous hospitality industry subsidiary
of Inter-Continental Hotel group that operate their business in over the world with the aim of
generating larger profitability level. It was established in 1952 to serve their hospitality
services to large number of customers in order to attain their satisfaction level. The main
focus of this company is to retain their customers so that they can establish their positive
brand image. For attaining the same, management of human resource is crucial that support in
handling customers and provide them better satisfaction.
Research aim:
“To examine the role of human resource management in customer's retention” – A
Case on Holiday Inn Hotel, London.
Research objectives:
 To study the concept and importance of customer retention for an organisation.
 To identify the practices used by Holiday Inn Hotel for improving the customer
retention.
 To examine the role of Holiday Inn Human Resource Management in acquiring
customer's retention.

 To study the relationship between Human Resource Management and customer's
retention in Holiday Inn.
Research Questions:
 What do you understand from the concept and importance of customer retention for
an organisation?
 What are the practices used by Holiday Inn Hotel for improving the customer
retention?
 What is the role of Holiday Inn Human Resource Management in acquiring
customer's retention?
 What is the relationship between Human Resource Management and customer's
retention in Holiday Inn?
Rationale of research
Every research project provides vast and detailed information that assist investigator
in improving the possibilities of attaining positive and reliable outcomes. In context of this,
the primary reason behind selecting as well as undertaking this research is to effectively
evaluate the role of human resource management in improving customers retention (Papa and
et. al., 2018). As it helps in determining the actual analysis that support company in inviting
large number of customers. Along with this, current study is also support researcher in
improving their skills and knowledge about specified topic and area. This will directly
contribute in attaining positive and authentic results at the end of the investigation that
support in making overall research more successful and reliable in nature.
LITERATURE REVIEW
Concept and importance of customer retention for an organisation
The identity of one of the best customers is that they purchase company’s products
over and over again. According to the viewpoint of Al-Refaie, (2015), Customer retention is
said to be a process when consumers for a specific period of time purchase products and
goods an organisation. It helps a company in developing an appropriate relationship with its
customers. The best way to retain customers is to provide with the stuffs they expected. Most
of the companies prefer to keep their customer retain for a longer period of time because
attracting new customers can charge them high at cost i.e. five times more than the existing
consumers. Moreover, customer retention increases profits by around 25% to 95%.

Therefore, to understand this better some points on importance of customer retention is
mentioned below:
Save Money: Companies’ prior motive is always to minimise expenses and maximize
profits. Thus, customer retention is the significant way for doing the same because keeping
old customers is better than to go for new customers as old customers are familiar with the
products and services. Apart from this, with the help of word-of-mouth company can
advertise their services in a cost-effective manner. A valued customer, always trusts on the
facilities provided by their preferred company and always gives loyal feedbacks. therefore,
with the help of this organisation can check in what they are going well and what are their
flaws and need to work on.
Maximum Profits: In order to attain maximum profits than it is important that
company fulfil all the need and wants of customers. Moreover, corporation can provide
offers, discount coupons etc., it will not only attract more and more customers but increase
their market share as well. As old customers knows the value of the brand therefore, they
become less price-conscious and willing pay whatever price a commodity is asking.
Practices used by Holiday Inn for improving customer retention
With the establishment of company, they focus on building a long-term relationship
with its customers. As this is a hospitality industry so, expectations of guests are relatively
higher than others and there can be many reasons behind this Zhang and et. al., (2015), opines
in the study that, with the change in course of time, technology is playing a crucial role in
making its customers aware about the services and facilities they are providing. Therefore,
delivering on the basis of customer’s expectation can increasingly profitable. In relation to
this, Holiday Inn can use some of the practices and these are mentioned below for better
understanding.
Identify priority guests: Unlike new customers company should also prioritize past
guests. Although criteria used for new guests won’t be applied in identifying old customers.
So, for this company can lookout for pass bookings that has previous records. Moreover,
organisation can use models such as monetary value, recency and frequency to categorise and
identify who are their prior customers. Therefore, once guests are prioritized than managers
can look for strategies through which guests can be attracted.

Provides Offers: Everyone loves to get rewarded and giving offers is the best
practice for improving customer retention. This will help in attracting customers and for
companies it will build good customer engagement. In relation to this, corporation can
provide discount offers for their hotel stays or in food and beverages. Furthermore, loyalty
programme for their regular customers can motivate them to come back to hotel more often.
Guest’s Feedback for future stay: This practice is not the only way to enhance
services and offerings but also act as a motivational tool for providing future experiences.
Having guest’s feedbacks is kind of give company with an overview about the facilities they
provided. Whether it was good or bad and if not appropriate than what measures can be taken
to improve and make their stay special.
Role of Holiday Inn’s Human Resource Management in acquiring customer’s retention
According to the viewpoint of Sparrow and Makram, (2015), in a business, whether it
is a corporate company or a hotel industry Human Resource Management plays a crucial role
because they look out for most of the activities like, taking customer’s feedbacks, make them
aware about new offers, considering the preference of customers etc., Therefore, in relation
with customer retention Human resource management can contemplate some of the points.
Demonstrate personalised customer services: Hotel industry is known for its
services and facilities provided and for them guests are like their God. Thus, whenever guests
arrive whatever company is serving should be according to the specific needs and wants. This
should like good old-fashioned customer services for instance: if anything goes wrong that
human resource management should handle the situation in helpful and empathetical manner.
However, this can reverse the potential damage and might increase the interest of customers
to return to the hotel for another visit. Apart from this, Human Resource Management, should
focus on the quality of room that are provided to its customers for both business and leisure
travellers. Reason behind is that an individual is spending money to have a pleasant stay and
if this only is not fulfilled than it can have a bad impression.
Keep the conversation going: For guest who are in priority list, Human Resource
Management can send personalised thank-you note. Along with this, they can request guests
to write positive feedbacks and reviews in their websites so as to demonstrate social trusts.
Even after some weeks or months, company should be kept in touch and conversation must
go on, through emails, telephonic conversation, social media sites and websites corporation
can provide information and offers they can avail for when they will visit for the next time.

Relationship between Human Resource Management and customer’s retention in
Holiday Inn
Over the past few years, Human Resource Management has come up as an important
department for resolving problems and doing other activities as well. Generally, they work
related to the issues such as organisational development, hiring, benefits, wellness, providing
better services etc., Therefore, in order to do the same, they make effective strategies and
follow directions to fulfil goals and objectives.
Customer retention, for any company is very important because they are the one who
can provide corporation with benefits. In a hospitality industry, if poor quality services in
housekeeping is provided than it can put a bad impact on the entire hotel. So, here it becomes
a crucial role of HRM department to hire candidates who are good in the same because
trained employees can win the loyalty of customers with their services (Rahimi and Kozak,
2017). While talking about the relationship between Human Resource Management and
customer retention; hotel industry is what they present to their customers. Services and
facilities, for which they are known for. If Human Resource Management provides effective
training to its employees than they can be able to interact with guests in an appropriate
manner by considering all the needs and wants. Moreover, it can help company in retaining
its customers for a longer period of time. Guests may feel like coming to the same hotel again
and again.
Therefor, Human resource management is determined as a backbone of a company
that look out for all the services and ways by which efficiency of industry can be enhanced.
RESEARCH METHODOLOGY
It is referring to the process that used by investigator to undertake research activities
in a systematic manner. This is the reason that it is one of the important sections through
which researcher can easily take right decision and at the same time also draw a valid
conclusion at the end of the investigation (Wallace and et. al., 2014). It includes various
method and techniques that help in gathering reliable and authenticate data towards specified
topic and area.
Types of investigation: While undertaking research there are different type of method such as
qualitative and quantitative method of study. In this, researcher is responsible for selecting
the best suitable one so that they can easily make a valid investigation. For undertaking

current research, investigator will be applied quantitative research method as it is beneficia in
collecting measurable information that effective in taking any kind of judgement within the
study.
Research philosophy: It is based on belief in which data should be gather, analysis and
evaluated as well. This will support in providing a way to investigate about specified topic
and area as well. It divided into two philosophy i.e. positivism and interpretivism. Under this
research, investigator would be applying positivism research approach as it provide
quantifiable observation that is measurable in nature (Jackson, Schuler and Jiang, 2014). With
the assistance of this, researcher get trustworthy information that put positive impact over the
end outcomes of the study.
Research approach: At the time of undertaking investigation activities, it provides an
effective framework in which each and every task of investigation is undertaken as it helps
researcher to draw a valid conclusion. In this context, there are two type of approaches such
as inductive and deductive. Both are crucial for evaluating as well as analysing information
on the basis of selected research area. For undertaking current research, investigator will
apply deductive research approach because it provides the way in which data is collected in
nature of statistical aspect that is easy for measure. By this, researcher can improve the
possibilities drawing a reliable judgement that contributes in attaining positive outcomes.
Data collection: It is important for researcher to select right and best suitable method of data
collection at the time of undertaking research as it helps them in gathering valid information
in order to make a study more successful. In this regard, there are two type of data collection
method such as primary and secondary. Both are appropriate for investigator collect detailed
in measurable content. In this primary method provide fresh and first hand data that is
directly collected through selected respondents (Al-Emadi, Schwabenland and Wei, 2015). It
includes various sources such as survey, questionnaire, interview, observation and many
more. On the other side, secondary method is also effective and it help in providing detailed
and in-depth information from the different published sources like books, journals, articles,
published magazines, newspaper and many more. For undertaking this research, research will
apply both methods in which primary method help in preparing a questionnaire that consist
various close-ended questions and secondary method of data collection assist in undertaking
literature review. With the help of this researcher can easily attain positive and authentic
outcomes.

Research sampling: It is based on an effective procedure that can be used by researcher to
select sample size from the huge population. It can be classified on the basis of two
techniques such as probabilistic and non-probabilistic (Lu and et. al., 2015). For carried out
current research, probabilistic sampling method would be applied in which respondents are
selected as per random basis and also get equal opportunities to be selected for providing
their views and opinion to investigator as per research topic. By using this method, researcher
select 20 respondents who are the employees and customers of the company and also have
proper information about research topic. This will aid in taking valid and reliable decision
within the study.
DATA ANALYSIS & FINDINGS
Questionnaire
Q1) Dou you aware about the human resource management?
a) Yes
b) No
Q2) Does human resource management help in retaining customers within the
company?
a) Yes
b) No
Q3) Is effective planning of human resource is beneficial for company in improving
positive brand image?
a) Yes
b) No
Q4) What kind of HR practices used by Holiday Inn for enhancing the customers
retention within the company?
a) Provide discount coupons
b) Understand customers queries
c) Ask for opinion/ feedbacks
Q5) What is the role of human resource management in improving the customers
base within the business organization?
a) Give proper attention to customers
b) Improve quality services
c) Building positive and healthy relation with customers
Q6) What is the challenges faced by Holiday Inn at the time of providing satisfaction

to its customers?
a) Inappropriate quality services
b) Lack of management in staff members
c) Frequent change in customers demand
Q7) What are the ways by which Holiday Inn can easily retain and satisfy customers?
a) Provide quality standards
b) Proper management of people
c) Understanding the customers
Q8) Is customers retention is help Holiday Inn Capturing and establishing
competitive image?
a) Yes
b) No
Q9) Does human resource management and customers retention within the company
is interrelated with each other’s?
a) Yes
b) No
Q10) Recommended the ways by which Holiday Inn can retain the customers for
longer period of time.
Data sheet
Q1) Dou you aware about the human resource management? Frequency
a) Yes 15
b) No 5
Q2) Does human resource management help in retaining
customers within the company?
Frequency
a) Yes 17
b) No 3
Q3) Is effective planning of human resource is beneficial for
company in improving positive brand image?
Frequency
a) Yes 18
b) No 2
Q4) What kind of HR practices used by Holiday Inn for
enhancing the customers retention within the company?
Frequency
a) Provide discount coupons 10

b) Understand customers queries 7
c) Ask for opinion/ feedbacks 3
Q5) What is the role of human resource management in
improving the customers base within the business organization?
Frequency
a) Give proper attention to customers 8
b) Improve quality services 6
c) Building positive and healthy relation with customers 6
Q6) What is the challenges faced by Holiday Inn at the time of
providing satisfaction to its customers?
Frequency
a) Inappropriate quality services 9
b) Lack of management in staff members 7
c) Frequent change in customers demand 4
Q7) What are the ways by which Holiday Inn can easily retain
and satisfy customers?
Frequency
a) Provide quality standards 7
b) Proper management of people 7
c) Understanding the customers 6
Q8) Is customers retention is help Holiday Inn Capturing and
establishing competitive image?
Frequency
a) Yes 17
b) No 3
Q9) Does human resource management and customers retention
within the company is interrelated with each other’s?
Frequency
a) Yes 14
b) No 6
Theme 1: Awareness about human resource management.
Q1) Dou you aware about the human resource management? Frequency
a) Yes 15
b) No 5

15
5
a) Yes b) No
Interpretation: From the above-mentioned graph it has been evaluated that human resource
management play a crucial role in business organization as it helps in managing workers at
working area with the aim of improving their productivity. As overall success of company is
highly depending over its workers. In context of this, 15 out of 20 people are aware about the
HRM and its effectiveness for company. On the other side, rest of 5 participants are not
familiar with this theme.
Theme 2: Human resource management help in retaining customers within the business
organization.
Q2) Does human resource management help in retaining
customers within the company?
Frequency
a) Yes 17
b) No 3

17
3
a) Yes b) No
Interpretation: As per preceding graphical representation, it has been evaluated that HRM is
one of the effective procedures to inviting more and more talented workers who have ability
to do their best at working area. As they also help in retaining customers by providing them
best quality of services as per their needs and wants. In this 17 out of 20 participants are
favour with this theme as they said that proper human resource management assist in
improving customers base. On the other side, remaining 3 respondents are not agreed with
this statement.
Theme 3: Proper planning of human resource is beneficial for company in improving
positive brand image.
Q3) Is effective planning of human resource is beneficial for
company in improving positive brand image?
Frequency
a) Yes 18
b) No 2

18
2
a) Yes b) No
Interpretation: As per mentioned graphical representation it can be analysed that every
business organization wants to attain success at market place. As it is based on its employees
because they give their best efforts for attaining their targets. In context of this, 18 people
think that effective management of human resource may contributes in establishing its
positive and competitive image and remaining 2 participants are not familiar with this theme.
Theme 4: HR practices used by Holiday Inn for enhancing the customers retention
within the company.
Q4) What kind of HR practices used by Holiday Inn for
enhancing the customers retention within the company?
Frequency
a) Provide discount coupons 10
b) Understand customers queries 7
c) Ask for opinion/ feedbacks 3

10
7
3
a) Provide discount coupons b) Understand customers queries
c) Ask for opinion/ feedbacks
Interpretation: There are various HR practices that could be used by business organization
to satisfied and retaining their customers. As 10 people give their views that providing
discount coupons is best practice that invite more and more consumers. 7 participants think
that understanding customers queries is an effective practice and rest of 3 respondents said
that asking for customers opinion and feedback is an appropriate HR practice that directly
contributes in retaining large number of customers within the company.
Theme 5: Role of human resource management in improving the customers base within
the business organization.
Q5) What is the role of human resource management in
improving the customers base within the business organization?
Frequency
a) Give proper attention to customers 8
b) Improve quality services 6
c) Building positive and healthy relation with customers 6

8
6
6
a) Give proper attention to customers
b) Improve quality services
c) Building positive and healthy relation with customers
Interpretation: In business organization, HRM play a crucial role in providing customers
satisfaction because talented and able workers can easily handle their guest and provide them
best services. In this, 8 people give their views that give proper attention to all the consumers
is effective role, 6 participants think that it improves quality services and rest of 6
respondents share their opinion that building positive and healthy relation with customers is
also a crucial role. All these are beneficial in increasing customers base that improve
performance of business organization.
Theme 6: Challenges faced by Holiday Inn at the time of providing satisfaction to its
customers
Q6) What is the challenges faced by Holiday Inn at the time of
providing satisfaction to its customers?
Frequency
a) Inappropriate quality services 9
b) Lack of management in staff members 7
c) Frequent change in customers demand 4

9
7
4
a) Inappropriate quality services b) Lack of management in staff members
c) Frequent change in customers demand
Interpretation: As per above mentioned graph it has been evaluated that various kind of
issues are faced by company that negative impact over the customers satisfaction. In this, 9
people give their views that inappropriate quality services is major challenges, 7 participants
think that lack of management among staff members is issues and rest of 4 respondents said
that continuous change in customers demand is challenges that faced by company at the time
of providing better satisfaction to its target customers.
Theme 7: Ways by which Holiday Inn can easily retain and satisfy customers.
Q7) What are the ways by which Holiday Inn can easily retain
and satisfy customers?
Frequency
a) Provide quality standards 7
b) Proper management of people 7
c) Understanding the customers 6

7
7
6
a) Provide quality standards b) Proper management of people
c) Understanding the customers
Interpretation: From the above-mentioned graph it has been analysed that different
alternatives are there which used by company to satisfy their customers. As 7 participants
think that providing quality standard to its customers, 7 respondents give their views that
proper management of staff members at workplace is also an effective way to overcome from
the challenges and on the other side, remaining 6 people said that understanding customers
demand is best way to provide better satisfaction to its consumers. With the help of this firm
can easily improve their brand image and at the same time also retain their customers for
longer period of time.
Theme 8: Customers retention is help Holiday Inn Capturing and establishing
competitive image.
Q8) Is customers retention is help Holiday Inn Capturing and
establishing competitive image?
Frequency
a) Yes 17
b) No 3

17
3
a) Yes b) No
Interpretation: As per discussed graphical representation it has been examined that
customers retention is one of the important aspects for business organization as it helps in
improving positive brand image and at the same time also assist in capturing larger market
share from its competitors. In context of this, 17 out of 20 participants think that by satisfying
and retaining customers is contributes in increasing brand image. On the other side,
remaining 3 people are not favour with this theme.
Theme 9: Human resource management and customers retention within the company is
interrelated with each other’s.
Q9) Does human resource management and customers retention
within the company is interrelated with each other’s?
Frequency
a) Yes 14
b) No 6

14
6
a) Yes b) No
Interpretation: In business organization, HRM and customers retention are interrelated
because without employees’ company can not be able to handle their customers. This is the
reason that organization focus on improving employees’ abilities and productivity so that
they can easily improve their customers base and also established their competitive image. In
context of this, 14 participants are agreed with this theme and rest of 6 people are not give
their support towards this statement.
RECOMMENDATION
In competitive market place, every business organization focus in inviting more and
more customers so that they can develop positive image. As customers are the one who have
potential impact in increasing profitability level. In this regard, there are some
recommendation for Holiday Inn for increase their customers base:
 Company should analysis customers demand before providing them quality services
as it supports in understanding about the needs that customers are really want. This
can be effective for organization to provide better satisfaction to its target customers.
 For retaining customers, organization needs to effectively manage their workforce so
that they can handle their customers appropriately. With the help of this, employees
can build trust among customers towards the company and its offerings as well.
 Along with this, organization needs to provide better training and development
programs to their employees in order to make them productive and efficient. By this
they easily perform their task and activities and at the same time also able in
delivering best services to its customers.

CONCLUSION
From the above-mentioned research, it has been concluded that, HRM play a
significant role in business organization because it is a strategic approach that support
company in attaining their set targets in stipulated time frame. Along with this, it is also
beneficial in handling customers by providing them quality services as per their needs and
wants. One of the main advantages of proper human resource management is to understand
the actual needs and wants of all the guest who visit the hotel. This may improve loyalty of
consumers by satisfying their needs. In addition of this, while retaining consumers, company
also face various issues such as inappropriate quality services, lack of staff management,
frequent change in customers demand. All these are negatively impact over the company and
its brand image. For this, firm can implement effective ways like understanding customers,
maintain quality standard and proper management of workforce. With the assistance of this
company can easily established its competitive image and generate larger profitability level.
It is also beneficial in inviting or retaining more and more consumers within the company and
its quality services as well.

REFERENCES
Books and journals
Cascio, W. F., 2014. Leveraging employer branding, performance management and
human resource development to enhance employee retention.
Papa, A. and et. al., 2018. Improving innovation performance through knowledge
acquisition: the moderating role of employee retention and human resource management
practices. Journal of Knowledge Management.
Al-Refaie, A., 2015. Effects of human resource management on hotel performance
using structural equation modeling. Computers in Human Behavior. 43. pp.293-303.
Zhang, J. and et. al., 2015. The effect of leadership style on talent retention during
merger and acquisition integration: Evidence from China. The International Journal of
Human Resource Management. 26(7). pp.1021-1050.
Sparrow, P. R. and Makram, H., 2015. What is the value of talent management?
Building value-driven processes within a talent management architecture. Human resource
management review. 25(3). pp.249-263.
Rahimi, R. and Kozak, M., 2017. Impact of customer relationship management on
customer satisfaction: The case of a budget hotel chain. Journal of Travel & Tourism
Marketing. 34(1). pp.40-51.
Wallace, M. and et. al., 2014. Attracting and retaining staff: The role of branding and
industry image. In Workforce development (pp. 19-36). Springer, Singapore.
Jackson, S. E., Schuler, R. S. and Jiang, K., 2014. An aspirational framework for
strategic human resource management. The academy of management annals. 8(1). pp.1-56.
Al-Emadi, A. A. Q., Schwabenland, C. and Wei, Q., 2015. The vital role of employee
retention in human resource management: A literature review. IUP Journal of
Organizational Behavior. 14(3). p.7.
Lu, C. M. and et. al., 2015. Effect of diversity on human resource management and
organizational performance. Journal of Business Research. 68(4). pp.857-861.
Stone, D. L. and et. al., 2015. The influence of technology on the future of human
resource management. Human Resource Management Review. 25(2). pp.216-231.
DeCenzo, D. A., Robbins, S. P. and Verhulst, S. L., 2016. Fundamentals of human
resource management. John Wiley & Sons.
Chelladurai, P. and Kerwin, S., 2018. Human resource management in sport and
recreation. Human Kinetics.
Pappas, I. O. and et. al., 2014. Moderating effects of online shopping experience on
customer satisfaction and repurchase intentions. International Journal of Retail &
Distribution Management.
Wilton, N., 2016. An introduction to human resource management. Sage.
McCracken, M., Currie, D. and Harrison, J., 2016. Understanding graduate
recruitment, development and retention for the enhancement of talent management:

sharpening ‘the edge’of graduate talent. The International Journal of Human Resource
Management. 27(22). pp.2727-2752.