Evaluation of InterContinental Hotels Group International HRM Strategy

This report provides a comprehensive evaluation of InterContinental Hotels Group's (IHG) international Human Resource Management (HRM) strategy. It begins with a PESTLE analysis of the hospitality sector and an overview of IHG, followed by an examination of host and parent country evaluations, comparing cultural and economic factors. The report delves into HRM theories, models, and methods, including IHG's recruitment system. It assesses the effectiveness of HRM strategies, addressing issues related to strategic integration and reward system management. Furthermore, it explores the significance of different types of training and their application at global and national levels. The report also investigates the relationship between HRM and organizational performance, incorporating the theory of employee participation. It analyzes organizational, national, and cultural issues impacting HRM strategy implementation, including reward systems and performance management. Finally, the report highlights essential management skills for international business and concludes with recommendations.

Evaluating an International
HRM Strategy

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................3
TASK 1............................................................................................................................................3
Pestle of Hospitality sector..........................................................................................................3
Organisation overview................................................................................................................4
Host country evaluation..............................................................................................................5
Parent country evaluation............................................................................................................5
Comparison.................................................................................................................................6
TASK 2............................................................................................................................................6
HRM Theories, models and methods..........................................................................................6
IHG recruitment system..............................................................................................................7
TASK 3............................................................................................................................................8
Effectiveness of HRM strategies ................................................................................................8
Issues in respect to strategic integration and reward system management.................................8
TASK 4............................................................................................................................................9
Types of training and its significance.........................................................................................9
Differences in training programs for global and national level operations.................................9
TASK 5..........................................................................................................................................10
Relationship between HRM and organisational performance..................................................10
Theory of employee participation and its significance.............................................................11
TASK 6..........................................................................................................................................11
Organisational, national and cultural issues that influence development.................................11
Theory of reward system...........................................................................................................12
Concept of performance management and appraisal frameworks............................................12
TASK 7..........................................................................................................................................13
Management skills required for international business.............................................................13
Recommendation.......................................................................................................................13
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................15

INTRODUCTION
In today's competitive world, Organisation are expanding their business internationally to
achieve economies of scale and increasing profit base. To manage international business is a
challenging task and International HRM assist the company attain the purpose of this
international expansion. It is the management of human resource in operating the business in 2
nations or more than that (Benson, 2010). In addition to this, it can be stated that there are
diverse economic factors that has great impact on the HRM. Classification of factors can be as
globalization, economy, consumer behaviour, etc. Any kind of changes in these kinds of factors
may impact overall HR development in diverse manner. Companies are more focused towards
diverse hard and soft HR activities while havig operations in international market.
For the better understanding of international HRM, the researcher have taken
InterContinental Hotel Groups, is the multinational hospitality company which is best known for
its innovative approach to products, amenities and service. This report critically evaluates the
international business environment and focuses on the main HRM theories and models with
regards to economic drivers. It evaluates the importance of HRM strategies in achieving the
goals of employee's dedication and analyse the differences in approach to HRM globally. The
present report depicts about the relationship between HRM and employee performance through
theories and analyses the organisational, national and cultural issues that affects the decision and
implementation of HRM strategy. It demonstrates the management skills that are required to
successfully engage and win support from employees at the workplace.
TASK 1
Pestle of Hospitality sector
Political: Political stability is important for the success of every industry, In hotel
industry, It impacts the number of visitors (Tourist and business travellers) in a country. For
instance, the political instability at international level may create threat and fear in the potential
tourist to visit that particular region due to safety concerns (Fitsimmons, 2012). Further, acts of
terrorism has also branded diverse destinations as a place of extremist religious organizations.
This have negative impact on the hospitality sector performance. It indicates that the business
firms need to consider political aspects as significant factor for success (Foscarini, 2012).

Economic: Hospitality sector is affected by the National and International
macroeconomic conditions. For instance, during the Olympic times and seasonal time, the
profitability of the hospitality sector has great opportunity because most of the Hotel were
booked and occupied by the visitors (Gwilliam, 2013). Due to global economic and financial
crisis the sector face key issues that create unfavourable condition for hotel business. Profit
margin ratio of sector has significantly declined in such period due to economic challenges
(Kelly, 2011).
Social: It has been noticed that the social belief of customer is dependent upon nature and
cultural aspect of nation. It is significant for hospitality organisations to have proper
understanding in regard to cross cultural values so that services can be developed in order to
attain better opportunities in the market (Henderson, 2015). In addition to this, demographic
aspects and population also has great impact on the development of hospitality sector so business
firm need to ensure about it in appropriate manner.
Technological: In the recent years, there has been drastic change in the technology.
Hospitality sector has started using online marketing tool. It is beneficial to promote product and
services. Websites like trip advisor has become one of the main information provider for hotels,
so organisations are using it to make reputation and create good image in the market (Joe, 2008).
Moreover, there are number of tools that are being used by organisations to provide convenience
to customers in respect to booking. For example, mobile application, social media, etc.
Legal: There are diverse international trade firms that have working in respect to
development of sector. It is significant for organisations to make sure that the legal policies must
be followed by businesses so that ethical practice can be promoted (Lucio, 2013). Along with
this, international trade policies also need to be consider so that goals and objectives can be
accomplished in desired way (IRuysseveldt, 2014).
Environmental: Sector mostly faces environmental issues during expansion of business
because building a new hotel causes forest cutting. In this respect, organisations may face critical
issue so it is significant to make sure that the environmental policies designed by government
and trade unions are followed (Werner, 2008).
Organisation overview
InterContinental Hotels Group PLC is a multinational hotel chain that operates its
business from UK. Company headquarter is located in Denham, UK. Organisation was founded

in year 2003 and currently operating its business activities in nearby 100 countries. It has been
noticed that the IHG operates 5,028 hotels in global market (Harzing and Pinnington, 2010).
Hospitality firm is also providing great support to economic development because in year 2015
the operating income of business was 680 million dollars. Company is offering better lifestyle
and job opportunities to 73,11 in all over the world.
Host country evaluation
As per detailed study, it can be said that the India is one of host country for IHG hotels
and company is continuously expanding its business in the nation. There are number of issues
that may be faced by companies while having implementation of HR strategies because internal
values are different as compared to parent country (Hendry, 2012). In India perception of
employees is different so organisation can not implement HR policies as per UK culture. Legal
values are also different so that company need to design strategies according to Indian
government frameworks (Iang and Baer, 2012). For implementation of change management,
IHG need to adopt different kind of strategies because social values of India is different as
compared to parent nation. Economic conditions are good so company can take advantage of it in
order to have better opportunities in the market. According to report of BBC, India is having
great opportunity in competitive market so IHG Hotels can focus on India for business
expansion. GDP is also stable that means the economic conditions within nation are also stable
that is beneficial for business firm. Tourism sector of India is also booming that means the
business firm can focus on business expansion because tourism sector development is beneficial
for hospitality industry. 7.6 percent is annual economic growth of India that indicates positive
elements for sector.
Parent country evaluation
It was found out that UK has been under the recession for the 3 years due to that revenue
management practitioner are facing the challenge to survive in these uncertain times. Sine the
economic condition of the market has been facing downturn as a result market has become
smaller and the competition has escalated (Jones, 2010). Nowadays UK economic aspects are
stable that provides better opportunity to IHG in international market. One of key benefit is that
the company is well aware of social and cultural values that allows to have better opportunities in
the market (Love and Singh, 2011).

Comparison
It has been noticed that the cultural values in parent nation and host country is different
so it is significant for business firm to make sure about it. In India cultural values are linked with
historical aspects and in UK cultural values are not stable because it changes with transformation
in services. 6-D Model indicates the difference between UK and Indian culture so management
of IHG hotel need to focus on it in appropriate manner (Armstrong, 2011). It has been noticed
that the power distance is high in India and individualism can be rated high in terms of UK.
Along with this, long term orientation is equal in both the countries that can be one of key
benefit for IHG Hotels. Uncertainty avoidance is slightly high in India when it is compared with
UK culture.
TASK 2
HRM Theories, models and methods
As per detailed study, it can be stated that the contingency theory is considered as one of
key theory that helps in effective application of HR activities. It is also referred as task orientated
Illustration 1: Cultural dimensions comparison

and people oriented theory because it allows leader to have changes in work style. With an
assistance of this, unfavourable conditions can be transformed into favourable (Baker and Doran,
2007). According to this theory the HR theory is more favourable when followers have respect
and trust towards leader. It is considered as well structured theory that helps in effective
accomplished of goals and objectives. In addition to this, it can be said that there are various
methods that are being adopted by HR in order to have effective development of organisation
(Boxall and Purcell, 2013). Cost centre can be established by management of IHG for ensure that
cost effectiveness can be improved. With an assistance of this, the business firm can also
improve work efficiency that is beneficial for long term goals accomplishment.
Other than this, whistle blower is also one of key method that can be accessed by human
resource management in order to have sustainable development. In this employee itself can
launch a complain against company in trade union or government agencies so that human
resource practice can be improved. It is beneficial for businesses to set out high standards in
respect to HR practice (Braynion, 2014). It is also necessary for business firm to focus on
workforce planning because it is a continous process that is used to align the needs and priorities
of organisation. It also facilitates in make sure that the workforce is well focused towards
legislative aspects in order to meet the organisational objectives (Baker and Doran, 2007).
During recruitment process, the proper information in regard to person specification need to be
shared with candidates. It will allow to have effective identification of candidates so that issues
can be overcome in desired way. It will also provide detailed information in regard to key skills
that are required to meet organisational needs.
Along with this, management of IHG also need to focus on Fraser’s fivefold grading. It is
a model that is classified in diverse factors. Classification of factors can be as impact on others,
acquired qualifications, innate abilities, motivation and adjustment. It is nessary for HR to ensure
that the physical makeup and appearance is being juidged during selection process. By having
focus on acquired qualifications, company can ensure about education and knowledge of
workforce (Boxall and Purcell, 2013). Level of motivation and determination towards work are
also key elements that helps in meeting objectives so selection process must be desinged as per
these aspects. Arlast, skills to have adjustm,ent is also significant because it helps in meeting
objectives.

IHG recruitment system
According to proper analysis of IHG web portal, it can be said that the company allows to
have online job application for diverse vacancies. It provides better convenience to job seekers
and allows to attain better opportunity at international event. It has been noticed that IHG
provides information about it work culture so that candidate can understand organisation and
sector in appropriate manner (Brown and Posner, 2011). It has also been stated on the web portal
that passionate, creative and person that have long termed vision is key preference of
organisation. Candidate has to create profile on the web portal of IHG so that candidates can be
recruited in appropriate manner. Along with this, further details about operational activities and
number of branches has been presented so that candidate can understand nature of business in
effective way (Cai and Kleiner, 2014). Eligibility criteria to have application in IHG is that
person must have score of 2.5 in his/her last education course. 1 year experience is essential to
have application for job profile in IHG hotels. Using internal careers site available on Merlin,
candidate can apply for job in the organisation. CV/resume also need to be upload on web portal
so that management can understand attributes of candidate (Benson, 2010).
Adequate candidates will be contacted for interview and selection process. In this, panel
focuses on diverse activities so that information collected about candidate can be ensure in
appropriate manner. If candidate is not selected then manager provide constructive feedback so
that it will assist in next application. Along with this, candidate profile will also be updated so
that recruitment process can be accomplished in appropriate manner (Fitsimmons, 2012). It is
significant to present self recognition in such manner that interview panel will find out candidate
as impressive factor for organisation. At last, selected candidates have to pass on training and
induction session so that overall performance can be improved.
TASK 3
Effectiveness of HRM strategies
In order to have effective development of HRM strategies, it is significant for
management of IHG hotels to make sure that the activities are designed as per strategic goals and
objectives. It will assist in leading business to impressive level of success. Along with this,
management also need to ensure that the strategies are implemented with a motive of employee
welfare and organisation development. It will also enhance the employee satisfaction level and

improve organisational performance (Foscarini, 2012). It is essential for HR manager of ING
hotels to ensure that talent management is being considered as critical aspect that provide better
values to the organisation. It will assist in retaining employees so that goals and objectives can
be accomplished in desired way. Employee engagement must be well developed so that issues
can be shared in desired way (Gwilliam, 2013). With an assistance of this, communication can
also be improved which is beneficial for identifying new ways to overcome problems. Moreover,
risk management concern is also significant for developing effective HRM strategies. It will
provide long term goals accomplishment and provide success driving results. Top level
management support also need to be developed in such way that employees feel valued while
working in an organisation (Kelly, 2011).
Issues in respect to strategic integration and reward system management
In addition to this, it can be stated that there are number of issues that can be faced by HR
manager of IHG hotels while focusing on strategic integration and reward system management.
It is one of critical task for business to identify that reward system management provides support
to organisational strategies or not. Determination of ways to accomplish internal equity and
external competitiveness is also one of key issue because internal and external factors faces
problem of instant changes (Henderson, 2015). Designing reward system management and
strategies to promote teamwork is also key issue. This is because in some situations the reward
system may demotivate members if reward is not appropriate as per expectations. It is also
necessary for HR manager of IHG to ensure that the integrated strategies are being developed to
ensure about sustainable development (Joe, 2008). It means proper balance between monetary
and non monetary reward is also essential to overcome issues. In order to have better
development of integrated strategies the management need to focus on employees needs, safety
and career development. Implementation of strategies is also one of key issue because it is not
possible that employees provide support to change (Lucio, 2013).
TASK 4
Types of training and its significance
There are number of training programs that can be adopted by management of IHG for
continuous improvement in skills of employees. Company can focus on on-job and off-job
training so that better assistance can be provided to members. On-job training allows to gain

practical knowledge because it has direct relationship with work activities (IRuysseveldt, 2014).
Off-job training can be theoretical training that may create issue while having a practical
implementation. Other than this, induction training is mostly provided to new employees so that
they can understand internal environment of an organisation. Job instruction training is being
provided to employees for addition in values and improve performance (Werner, 2008).
Refresher training is offered in order to incorporate the latest development in a particular field. It
is beneficial to have advancement in skills of workforce.
It has been noticed that training is significant because it helps in adopting change and
accomplish goals in appropriate manner. It is also advantageous for effective development of
competency of employees (Harzing and Pinnington, 2010). It also improves efficiency and
effectiveness so that level of self confidence can be enhanced. It will provide ability to meet
goals and objectives in desired way along with accomplishing employees needs.
Differences in training programs for global and national level operations
It has been noticed that the IHG can focus on different training programs for effective
development of human resource at global and national level. It is significant for management of
IHG to have selection of training program according to key needs of workforce. In order to meet
the standards of international business the organisation can focus on refresher training and off-
job training because it will enhance skills of members (Hendry, 2012). With an improved focus
off job training the company can ensure about skills development. Conferences and seminars can
be organised for improvement in knowledge of members. On the other side, for sustainable
development of employees at national level the business firm can focus on job training because it
will allow to make sure about job rotation (Iang and Baer, 2012). Along with this, team
assignments can also be provided to have development of employees and accomplish goals and
objectives. In this, company can also focus on induction and job instruction training because it
will assist in advancing the experience. It helps the employees to understand the procedures,
code of conduct, policies existing in that organization. Job instruction training provides an
overview about the job and experienced trainers demonstrates the entire job (Love and Singh,
2011).
In addition to this, it can be said that the using ASK model the effectiveness of training
program can be improved within IHG hotels. With an assistance of this, model the business firm
can provide integrated learning that mainly focuses on awareness, skills and knowledge so that

overall performance of employees can be improved (Braynion, 2014). It also assist in dealing
with globalization factors because it allows to target number of factors that are beneficial for
organisation. Using this, better awareness can be created regarding differences in cultural
aspects. Knowledge about working of hospitality sector at international level can also be
provided that is beneficial for long term development.
TASK 5
Relationship between HRM and organisational performance
As per the detailed study, it can be said that there is great relationship between HRM and
organisational performance. It has been noticed that if HRM policies are well designed then
organisational performance can be improved. It is because the HRM policies helps business firm
to accomplish needs of employees. It means employee satisfaction can be improved that will
provide better opportunities to amend overall performance (Armstrong, 2011). For example, HR
policies are not well designed then it will decrease the morale of employees. Decrease in morale
of workforce is not beneficial for improvement in organisational performance so it is significant
for management of IHG to focus on effective selection of HRM strategies (Baker and Doran,
2007). It has been identified that business also need to consider HR policies as consistent partner
of business strategies so that goals and objectives can be accomplished in desired way. In
addition to this, it can be stated that effective implementation of HR policies allows to gain
information in regard to operational activities that also provide improvement in performance. Fr
example, if HR policies are not appropriate then it might be possible that the employees may not
have proper acknowledgement about job roles (Boxall and Purcell, 2013). Without proper
concern of job roles the task can not be accomplished in desired way that means the performance
will also get influenced in negative manner.
Theory of employee participation and its significance
Employee participation is considered as one of key aspect that allows to accomplish goals
and objectives in appropriate manner. There are various theories that can be adopted by
management of IHG for effective promotion of employee participation. It has been identified that
employee participation theories are being classified on the basis of participation factors
(Braynion, 2014). Classification of theories can be as democracy theory, socialist theory, human
growth and development theory and productivity theory. In democracy theory the management

of IHG can focus on advancement of capabilities by involving them in political aspects.
Authorities can be provided to take decisions and new challenges can be offered to have
advancement in skills. Socialist theory implementation key focus is to provide control to workers
so that production process can be improved (Brown and Posner, 2011).
Human growth and development theory allows to have improvement in motivation level
so that they can have efforts in appropriate manner for sustainable development. In this, direct
involvement can be provided to workforce so that they can feel valued while having operation in
an organisation (Cai and Kleiner, 2014). However, employee participation is significant for
business firm because it allows to have advancement in morale so that better work environment
can be created. Employee involvement and empowerment directly links with the advancement in
the work productivity. It also permits to attain innovative ways that may help in overcome issues.
TASK 6
Organisational, national and cultural issues that influence development
It has been noticed that there are number of issues that may affect the organisational
development. In respect to organisational development, it can be stated that the safety and
operational issues can be considered as organisational issue that has direct impact on the
development of organisation (Ci-sheng and Shu-ming, 2012). For example, the company is
facing issue in respect to the operation then it might be possible then services may not be offered
to customers in appropriate manner. It will also impact the overall development which may
create issue for firm. Political conditions may also affect the development of business firm.
For example, IHG is looking for business expansion but UK government has increased
the tax rates which will have direct negative impact on the profit margin ratio. It clearly indicates
that the financial resources' allocation will also be influenced which may affect the expansion
project (Cornelius, 2012). Along with this, cultural issues are also critical that may influence the
development of organisation. For instance, IHG has introduced its new hotel in India but they
have not considered cultural values as per market needs. It may decrease the sales of IHG and
affect overall development of entity in negative manner (Denisi, Budwar and Varma, 2008).
Theory of reward system
Reward is considered as factor that may be provided to employees for advancement in
their morale and ensure that the goals are being accomplished effectively (Armstrong, 2011).