Talent Management Practices in South African Hotel Groups: An Analysis

This case study delves into the talent management practices employed by major hotel groups in South Africa, highlighting their significance in achieving a competitive advantage. The research, involving 14 hotel groups representing a substantial portion of the country's hotel rooms, assesses the extent to which these groups apply talent management principles. While the findings indicate a general adoption of these principles, certain problem areas are identified, leading to specific recommendations for improvement. The study emphasizes the importance of viewing talent as a strategic asset, aligning talent management plans with the company's vision, and utilizing technology-based systems to track and manage talent effectively. Key elements of a complete talent-management system, including employer branding, recruitment, training, performance management, and information systems, are also discussed. The research underscores the need for a competency-based approach to training and development, incorporating mentoring programs and assessment centers to evaluate both hard and soft skills, thereby contributing to the overall success and sustainability of the South African hotel industry.

1Southern African Business Review Volume 13 Number 3 2009
Talent management: An empirical study of
selected South African hotel groups
P.A. Grobler & H. Diedericks
A B S T R A C T
This article sheds light on the use of talent-management practices in
some of the major hotel groups in South Africa. Growing numbers
of organisations globally as well as in South Africa are embracing
the concept of talent management, as it has a major impact on the
company’s competitive advantage. Results reported in the 2008
Travel & Tourism Competitive Report issued by the World Economic
Forum (WEF 2008) indicate that as far as the Human Resources
dimension of companies in this industry in South Africa is concerned,
they fare fairly poorly. As this industry is people intensive, a
closer investigation of this aspect was necessary. The research
was undertaken in a subcomponent of the tourist accommodation
industry, namely hotels. A cluster of 14 hotel groups, representing
33 995 hotel rooms (approximately 77% of all the hotel rooms
in South Africa) participated in the survey. Despite the negative
finding of the WEF, the results indicate that the hotel groups to a
large extent apply the principles underlying talent management
within their companies. However, some problem areas do exist, and
recommendations are made in this regard.
Key words: talent management, talent retention, talent development, talent deployment,
human capital management, talent pools, talent value, competencies,
skills, distinctive capabilities, competitive advantage, talent supply, talent
demand, competency inventory
Prof. P.A. Grobler and Ms H. Diedericks are in the Department of Human Resource Management, University of
South Africa. E-mail: [e-mail]

P.A. Grobler & H. Diedericks
2
Introduction
The greatest challenge facing countries in the world today is the creation
for their citizens. One strategy to achieve this is to provide jobs for as ma
as possible. However, this can only be achieved if the country experience
economic growth. According to the World Economic Forum (WEF) (WEF 20
travel and tourism has become a major player among the key industries i
wealth over the last 60 years. This industry now accounts for approximate
of the global gross domestic product (GDP), 12.2% of world exports and 9
world investment (Blanke & Chiesa 2008b: 3). It is also one of the fastest
industries in terms of foreign exchange earnings and job creation, as hea
and tourism sectors provide important opportunities for countries to
standards and – particularly in the developing world – to tackle poverty al
(Blanke & Chiesa 2008a: xiii). From the foregoing, it is clear that the worl
and tourism industry is profitable and expanding. Moreover, in South Afric
industry has a major impact on the economy, with approximately 8
international tourists visiting the country in 2006 (Visser 2007: 43–44). Th
is no doubt that this segment of the economy needs to be constantly imp
expanded.
Problem statement
According to the 2008 Travel & Tourism Competitiveness Report co
World Economic Forum (2008: xvi), of the 130 countries participatin
project, South Africa was ranked at number 60. The country was evaluate
different pillars. This is cause for concern, as this industry can have a ma
on the economic growth of the country. It is even more disturbing that in
of Human Resources (HR), the country was ranked 118th out of 130. Plea
that certain HR components, such as the training of staff, did receive a ve
rating, while others such as hiring and firing practices were rated very low
the people component needs to be managed as an integrated who
company to obtain and maintain its competitive advantage, and all practi
to be synchronised.
Talent management
As a service industry, tourism is highly people intensive, and in thi
the management of employees working in the industry is a critical
The continued success of any organisation in this industry is depen

Talent management: An empirical study of selected South African hotel groups
3
employees’ contribution and commitment (Baum & Kokkranikal 2005: 86
can no longer be measured alone by the amount of money a company ha
talent it possesses in the form of its employees’ skills and competencies,
organisational capability, has become the key to success in today’s highly
business environment (Lockwood 2006: 2; Lawler III: 2008: VII). So why is
so important? According to Cheese (2008: 39–40), the following rea
identified:
• Talent generates high performance, which in turn attracts new talent a
the means to reward it.
• Talent drives improvements in productivity, quality, innovation and
satisfaction, which in turn feed into the bottomline results.
Without talent, the industry is thus doomed. While the industry o
qualified individuals such as graduates exciting and rewarding career opp
it also needs a vast number of operational staff. Low entry barriers and h
pose particular HR challenges to management in this area (Haven-Tang &
2006: 91). Against the background of the poor human resource results ob
the question can be asked: “How can this important and vital asset be nu
The answer can be found in the relatively new concept of talent m
(Armstrong 2006: 289; Becker 2007: 42–61; Corsello 2006: 12; Goff
2007: 72–79; Ingham 2006: 20–23; Joerres & Turcq 2007: 8–13; Landes 2
29; Meisinger 2006: 10; Oakes 2006: 21–24; Reindl 2007: 38–41; Silverm
11–15). According to Schweyer (2004: 22), talent management can be de
follows:
… the sourcing (finding talent); screening (sorting of qualified and unqualified applica
selection (assessment/testing, interviewing, reference/background checking etc. of a
onboarding (offer generation/acceptance); retention (measures to keep the talent tha
tributes to the success of the organisation); development (training, growth, assignme
deployment (optimal assignment of staff to projects, lateral opportunities, promotion
renewal of the workforce, with analyses and planning as the adhesive, overarching in
Thus, for talent-management initiatives to be effective, organisations n
processes, with many stakeholders involved and strong links between lea
talent to translate into specific organisational value-based behaviour (see
In order to successfully tie together all these activities indicated in Figu
leaders in human capital management should actively pursue a number o
which will be explained later in this article. Before this is done, it is impor
mention that talent management will only be effective if the following con
exist:

P.A. Grobler & H. Diedericks
4
Source: Armstrong (2006)
Figure 1: The elements of talent management
• Talent must be viewed by senior management as a strategic ass
importance for the company must be regularly communicated to every
organisation.
• Sufficient resources (funds) should be made available to support all the
management efforts.
• An effective talent-management plan and programme must be aligned
company’s vision, culture and overall strategy.
• Peopleand positionsmustbe trackedthrougha technology-basedtalent-
management system.
• A healthy working relationship between the human resource mana
department and line managers must exist.
• It is not the talented individual that is important, but the processes tha
manage and organise talent. These include having the right structures,
processes and practices fitting together in a coherent whole. For
organisations may have talented personnel but may not manage to sup
correctly.
y

Talent management: An empirical study of selected South African hotel groups
5
• The key elements of a complete talent-management system will
employer brand, a recruitment and selection process, a training and de
process, a performance management system that is tied effectively to
system and an information system that includes data on satisfaction, m
talent development, talent utilisation and performance. There shou
a process to assess an organisation’s competencies and capabilities (T
Pellant 2007: 3–4).
Where then does the process of talent management start? The first step is the
business strategy (see Figure 1). In determining a business strategy, it is important
to take cognisance of the existing talent within the company. The capabil
similar companies in the same industry also need to be identified in order
company to develop distinctive capabilities with a view to gaining the com
advantage. In the hotel industry, this could be customer service. The stra
indicate where the company will be heading, usually within the nex
With the strategy in place, the HR department, in conjunction with line m
(normally within each discipline, namely, Marketing, Finance, Produc
Research and Development), will identify the competencies needed to ac
company’s goals (talent demand). The written description of all the comp
needed within the organisation is known as a competency model (K
Ruse 1996: 23–24). Competencies are not static, however, and companie
continually develop new capabilities and competencies as the environme
which they operate changes. Such capabilities have been referred to as ‘d
capabilities’(Wright,Dunford& Snell 2001:712).Thus, organisationsmay
require new skills sets, necessitating the release of some existing e
the acquisition of new employees. Having identified the competencie
at the different levels within the company, an audit can be done o
competencies within the company. In a talent-management process,
beyond the old style of skills inventory (educational qualifications, trainin
work duties and responsibilities) to become a competency inventory that
and enables easy access to what people can do and the results th
for example, their skills and personal, functional, technical and other com
(DuBois, Rothwell, Stern & Kemp 2004: 64–67). Issues that will also be co
at this stage will include the effective deployment and redeployment of e
well as external workforce demographics. The result obtained here will be
the talent supply. Comparing the results of the two processes will probab
a talent gap. This will lead to the next step, namely the recruitment and s
talented new staff. In the talent-management process, extensive informa

P.A. Grobler & H. Diedericks
6
to be available to execute the recruitment and selection process properly
al. 2004: 102–103). For example, in the case of filling an existing post, th
must already have conducted an assessment of existing staff comp
placed the information in a competency inventory, which can then be use
layout of the advertisement. In the case of the selection process, key com
that are the biggest predictors of job success need to be identified
by the managers seeking the applicants. It is important to note tha
having only one interview with the candidate, multiple interviews w
This will ensure that the candidate actually possesses the competencies r
Although time consuming and costly, it will be worth the effort if top perfo
are ultimately selected. Once a candidate has been appointed, a training
written and executed. This will help employees to perform their current jo
effectively, prepare them for the next job on the career ladder, and prepa
a job in a different discipline (Paul 2005: 3). It is important to note that be
need for more training related to providing knowledge, building skills or im
attitudes, the competency-based approach must also include issues such
the motivation levels of employees and cultivating and developing person
to produce exemplary performers (DuBois et al. 2004: 130–137). In this p
a mentoring programme can play an important role. Measuring the
performance is the next step. This will help to identify the strengths and w
within the organisation. To assist in this regard, it is important that compe
profiles containing clear descriptors are developed to enable employees t
is expected of them. In evaluating the softer skills, such as interpe
use can be made of assessment/development centres as well as fie
– 360˚ appraisals (DeNisi & Griffin 2008). Using
performance appraisal will help identify the development needs of individ
map out routes to career advancement and progression. This information
be used in the redeployment of employees, enabling the company to hav
supply of talent. This is vital, as the organisation must know where it has
– which workforces and areas of business have the greatest strategic imp
critical in maintaining the distinctive capabilities of the company. Depend
the outcome of the performance management process, a reward can be g
employee. By linking compensation directly to individual contributions tha
a difference to the company, an organisation can maintain the highest ca
workers. According to research undertaken in this area by Horton (2002:
following are the main reasons why employers use competency-based re
• To motivate people and to encourage better performance
• To increase flexibility among the workforce

Talent management: An empirical study of selected South African hotel groups
7
• To change employee behaviour
• To give employees access to job progression and to allow some
progression where no other form of promotion opportunities exists.
Thus, the talent-managementprocesshelpsto leveragethe strengthsof
individuals and to unleash their potential in ways that are less likely to oc
traditional work-based system.
Applying these practices skilfully can lead to a number of benefits for o
as identified by Joerres and Turcq (2007: 12), namely:
• Enable human capital management to be aligned into a single system c
to business strategies
• Break down silos and force strategic consistency between different HR
areas, such as recruitment, training and compensation
• Allow more appropriate investments in people, based on talent value
• Increase the scalability and flexibility of business activities through mo
talent sourcing
• Facilitate better-informed decisions about changes in people strategies
greater understanding of potential benefits and risks.
In view of the numerous advantages to be gained when applying
management practices, it was decided to establish the extent to which th
are being utilised within the travel and tourism industry in South Africa. T
of the study will be on the accommodation subsector of the industry. As n
conducted research on the issue could be found in the literature, this stud
as exploratory. The aim of this paper is to present the findings of the inve
The accommodation sector in South Africa
All overthe world,traditionaltouristaccommodationhas undergonemajor
changes over the decades. In South Africa too, changes have taken place
establishment of a large number of lodges and guest houses. These deve
are not surprising, as tourist numbers have grown substantially each year
2007: 8–10). Today, tourist accommodation is by far the largest su
tourism industry (Sharpley 2005: 15). According to the website, Exploring
(accessed on 18 November 2008), the different types of
found in South Africa are indicated below. The rooms or sites that were av
in South Africa in each of these categories in 2005 are indicated in bracke
2007: 114):

P.A. Grobler & H. Diedericks
8
• Hotels (44 000)
• Caravan parks and camping sites (11 000)
• Guest houses and guest farms (11 000)
• Other accommodation (33 000).
Thus, a large variety of accommodation is available to the tourist in So
As far as hotel accommodation is concerned, the Tourism Grading Counci
Africa (TGCSA) indicates that more than three-quarters of the accommod
this component has been graded (TGCSA 2008). The star-grading criteria
TGCSA relate to the functional and physical characteristics of the establis
seeking grading, and to the range and level of services that the e
provides for its guests (Caras 2007: 118). The grading varies between on
lowest and cheapest) to five stars (the highest and most expensive).
Research methodology
Sample selection
As mentioned earlier, the focus of this study was to establish the extent t
management practices were being utilised within the travel and tourism i
South Africa. Due to time and money constraints, it was decided to focus
on the largest component within this industry, namely tourist accommoda
South Africa, this subsector can be divided into the following four c
(1) hotels, (2) caravan parks and camping sites, (3) guest houses and gue
and (4) other accommodation. As the focus of talent management is on p
was decided to choose the component with the highest people concentra
the study, namely the hotel group. During the research project, however,
clear that no single database with the names of all hotels in South
be found. This meant that the exact number of hotels in South Africa coul
be established. Faced with this dilemma, the researchers decided to mak
judgement sampling technique (Struwig & Stead 2001: 111). In this case,
in the subject of the survey choose what they believe to be the best samp
study. Respondent selection thus depends on the researcher’s judgemen
people are experts on the subject and consequently will provide th
required information. There are some drawbacks to using this approach, h
the sample may be biased and thus unrepresentative, and generalis
beyond the sample may not be possible (Struwig & Stead 2001: 115). In v
these restrictions, the researchers decided to compile a list of all the maj

Talent management: An empirical study of selected South African hotel groups
9
groups found in South Africa. These are groups that are fairly familiar to t
public. In many cases, these hotel groups have a presence in all the prov
country. A list of 15 such hotel groups was compiled. After finalising the l
HR Director at corporate level of each hotel group was contacted by telep
establish whether they would be prepared to participate in the survey. On
group declined due to heavy workload. The final sample thus comprised 1
groups. The researchers believed that this group was representative
groups in the country.
Survey design
After an extensive literature review of the subject area, questions were g
and a questionnaire drawn up. In this process, use was also made of the 2
Management Survey undertaken by the Society for Human Resource Man
(SHRM) in the USA (SHRM 2006). The questionnaire
• Section 1: HRM activity in the company
• Section 2: Staffing
• Section 3: Training and development
• Section 4: Retaining employees, with the following subsections:
4.1 Compensation, 4.2 Performance appraisal, 4.3 Labour relations,
4.4 Employee health and 4.5 Innovation and creativity
• Section 5: Motivation to commitment
• Section 6: Communication
• Section 7: Culture
• Section 8: Involvement in leadership
• Section 9: Policy and procedures
• Section 10: Management involvement.
For the majority of the questions, use was made of a four-point Likert s
scale ranged from strongly disagree (1), disagree, (2), agree (3) to strong
Pre-testing of the questionnaire
In this study, no formal pre-test was conducted, but inputs were obtained
in the Human Resource Department of the School of Management Scienc
University of South Africa. It was decided to followth
in this department are specialists in the different areas covered in the qu

P.A. Grobler & H. Diedericks
10
Statistical analysis
The primary method used to analyse the data collected was frequency an
study does not attempt to prove correlation or causality between the vari
frequency analysis was therefore considered adequate for the purposes o
The statistical analysis was carried out using the SPSS programme (SPSS
Response rate
The questionnaires were sent to the respondents (14 in total) by e-mail. A
useable questionnaires were returned, representing a response rate
is interesting to note from Table 1 that the respondents represent a tota
hotel rooms out of a possible 44 000 hotel rooms available in South Africa
2007: 114). The sample thus represented 77.2% of all hotel rooms in the
and can be regarded as representative of the hotel groups in South Africa
Table 1: Room profile of respondents
Hotel group N Number of rooms
available
A 1 10 522
B 1 7 595
C 1 4 773
D 1 4 459
E 1 3 500
F 1 2 200
G 1 620
H 1 623
I 1 38
J 1 25
Total 33 995

Talent management: An empirical study of selected South African hotel groups
11
Results and findings: Talent development
Section 1: HRM activity in the company
Nineteen items appeared in this construct. The items mainly
department at corporate level in the hotel group and its activities, but als
some demographics pertaining to the workforce of the company. There is
that for the talent-management process to work effectively, it is essentia
properly structured HR department at this level with suitably qualified sta
results show that all the respondents have an HR department at this leve
staff complement ranging from 2 to 171. This is understandable, especial
one looks at the size of the hotel groups participating in this study (see Ta
well as the number of staff employed by the groups, which ranged betwe
6 000. The results also show that in the case of the majority of the hotel g
(7 companies), the person responsible for HR was recruited either f
the HR department, or was an HR specialist from outside the organisation
is important, as an in-depth knowledge of HR activities is vital when deve
talent within a company – especially the use of best practices in this field
the different HR activities are concerned, it appears that activities not ou
to external providers include payroll, selection, HR information syste
processing of routine questions, whereas the majority of the companies (
outsourcedpensionsto a greatextent/completely.Regardingbenefits,only a
minority of companies (4) have to a great extent/completely outsourced t
Concerning training, the majority of companies (9) have to a small/
outsourced this activity, while the majority of companies (6) have not out
workforce outplacement/reduction at all. In the case of recruitment, the m
of the companies (6) have to a small/some extent outsourced this activity
important activities that can play a role in the talent-management
being managed by the companies themselves. An issue closely rela
HR activities is the development of policies governing these practices. Th
show that in the majority of companies (5–7) the HR department, in consu
with line management, formulates the policies in the following areas: (1)
benefits, (2) recruitment and selection, (3) training and development, (4)
relations and (5) workforce expansion/reduction. These policies all have a
on the flow of talent within the company, and a partnership between HR a
management is necessary for the talent process to succeed. Having easy
the talent inventory in a company is important. To realise this, the compa
have a computerised human resource information system (HRIS) in

P.A. Grobler & H. Diedericks
12
results show that the majority of companies (8) have some form of compu
system, ranging from a separate stand-alone system to an interface
system. This is a positive finding. The areas in which this system is used i
payroll, benefits, recruitment/selection, training and development, and po
practices. The areas where it is not used by the majority of companies at
include performance management, career planning/succession plannin
scheduling, health and safety and the measurement of HR performance. T
somewhat worrying, as these are important components in the deve
talent. Unfortunately, the systems used at present b
companies do not allow managers to complete HR processes online, nor d
allow employees to access personal information and perform simple HR t
as maintaining personal data, which can also be constraining. In order to
active role within the organisation, it is also important for the HR departm
understand how the company operates. For this to be possible, the depar
have a place on the board or equivalent top executive team. The results i
the majority of companies (8) do have such a place at the highest level fo
departments, which again is a positive finding. Closely related is the issue
strategies. For HR to make a meaningful contribution, it must be guided,
others, by a mission statement and a business strategy. The findings indi
the majority of companies (7–10) have the following in place: a mission st
business/servicestrategy,personnel/HRMstrategy,corporatevaluestatement,
diversity statement, code of ethics, corporate social responsibility st
lastly a communication policy. These are all important building bloc
creation and development of talent within a company. It was also found t
case of the majority of the companies (8), the HR director was involved fr
outset in the development of a business/service strategy. Measuring the p
of the HR function is essential in the talent environment. At present, mos
companies (8) only undertake this task to a small/some extent. If the con
of the HR function to the organisation is to be meaningful, this iss
to be addressed. The majority of the respondents indicate that whe
does take place, the following stakeholders’ views are considered: top ma
line management, employees and HR. This is a positive finding, as consul
between multiple groups of stakeholders is important. Having all the com
of the talent process in place is essential, but if the process is not conside
high priority by the company, it will be meaningless. The findings indicate
a majority of the companies (8), talent-management initiatives are seen a
priority and some such initiatives are in place. Unfortu
companies (4) have an employee that is exclusively responsible for overs