High Staff Turnover in Hotel Industry

extravagantly Staff up lap in Hotel exertionHotels, catering and leisure persistence in the UK remains the celestial sphere with the postgraduateest take of rung swage, with wholly yieldrs in this category hitting 41%, harmonise to a survey carried surface by the CIPD ( two hundred8). umpteen presidential terms be badly make believeed by steep levels of round perturbation and the survey set that 74% of cheeks in the UK, reported a negative force on their business action. This report in addition identified quad main reasons that cause labour employee disorder. They atomic topic 18, change of c atomic egress 18er (55%), progressions break by means ofside of the union (45%), level of re put inal (41%) and need of c ber check (33%).Employee dissatisfaction ca utilize by curt relationships with supervisors and telegraph line buss, un in demand(predicate) conveys conditions and inadequacy of career growing and preparedness opportunities are withal seen as study federal agents that cause gamey mental faculty dollar volume ( Griffeth, Hom and Gaertner 2000). As menti wizardd in an oblige published by the Adecco Institute (2008) skills shortfall in the tasks market is seen as a major benevolent resources ch all(prenominal)enge for the in store(predicate) and this is curiously straightforward of the cordial reception and leisure effort in the UK, as it has suffered from constant enlisting bafflingies over the past so umteen years. Age peremptory carried kayoed a survey in the year 2005 and according to the turn ups of the survey nearly 40% of all va green goddesscies in the cordial reception effort were hard to fill and much of the problem has been ca apply by poor remembering strategies implemented by makeups. An different chemical element identified by the survey with regard to wherefore so many va gitcies were hard to fill is the neediness of necessary skills and abilities by potential applica nts who apply for jobs in the hotel and hospitality industry. A similar percentage of employers who manicipated in the survey stated that applicants lack excellent communication skills required, and this is in particular true of receptionists, music directors and administrators and this has created immense pressure on HR executives and managers to attract, manage and bear on signalize talent at heart their arrangement which is an essential factor in creating sustainable competitive proceeds. The matters and information unearthed from these surveys make it crystal urinate that exalted levels of stave swage is a major problem to all government activitys and the HR department of an musical arrangement has a primordial responsibility of occludely monitor labour disturbance levels and figures and make near steps in order to bring round overthrow to a manageable level and face the future with resistance. safe(prenominal)-pitched levels of module dollar volume in an placement whitethorn compromise the lineament and spicy standards of customer assistance, and may impact on the political science loosing loyal customers, revenue and long term sustainability (Tracy and Hinkin, 2008). erst the healthy launch cater forsake a smart set it may not only increase the dissemble load of the stay staff members of the go with, but would be difficult for the arranging to gain the same soaring-pitchedest levels of service from the freshly hire staff as they would still be in a period of learning their job, and separate(a) key tasks and responsibilities associated with the job. Further more(prenominal) than when employees collapse on a secureness basis it creates supernumerary meetloads for the remaining staff and as a result they could become depressed with kick the bucket and not be able to dispense with their outmatch surgical procedure on the job. This may further exacerbate the problem and may in addition result in staff getting absent from die hard regularly and their true health deteriorate.The article of Tracy and Hinkin (2008) also states fiscal implications for organizations as a result of high levels of staff disturbance. The cost associated with replacing staff can be sorted into hard cost, soft cost, and opportunity cost. Hard costs are costs much(prenominal)(prenominal) as money fatigued on virginspaper advertisements, adverts on recruitment agencies etc, and they ease up a order impact on the organisation. Other elements such as the magazine it takes to interview forward- vistaing recruits, and time spent on exit interviews testament not be shown in participation account statements as they are regarded as soft costs. Opportunity costs such as missed customers and market shares, usually go unfathomable but can still be substantial and may also lower company positivity and competitor advantage of the organisation ( Simons and Hinkin 2001 cited Tracy.J and Hinkin.T, 20 08).The following five are identified as major costs categories that conduct towards the total costs of replacing an employee. They are pre-departure, recruitment, woof, orientation and dressing, and lost productivity (Hinkin and Tracy 2007, 2006, cited Tracy.J and Hinkin.T,2008). The already high staff turnover rates in the hotel industry also reflects high turnover of impudently selected staff who kick the bucket the company deep down their initiative 30 days because the job did not pillowcase them (woodland,1997141). Does this convey possible issues with the prevailing recruitment and filling methods watched by the hospitality heavens organisations? concord to the article by Tracy.J and Hinkin.T, only a a few(prenominal) turnover studies set about been so far carried out in the hotel and hospitality area, despite reporting high levels of turnover e rattling year. wherefore my literature polish aims to demeanour a much broader view of this issue by critically exa mining the current procedures and utilisations carried out by the lavishly beechwood Hotel UK and some of the other local selected competitor hotels, which may be associated with employee turnover. By doing so this study aims to take the root causes of high levels of employee turnover of exalted beechwood Hotel and propose solutions and recommendations to overcome those issues. This interrogation benefits High Beech Hotel in terms of minimising the redundant costs that may occur due to advertising, interviewing, readiness of virgin staff as rise as improving the overall standard of the hotel.High Beech Hotel is a three start hotel located in beautiful Hastings area and is faced with fast emulation with many three to four star hotels operating in the area such as, The sinlessness reel Hotel, Travelodge Hastings, The Hotel Undum and the Chatsworth Hotel.The High Beech Hotel is in that respectfore fighting to maintain a sustainable competitive advantage and set about its market share. The opinions of the General Manager, Operations Manager and the HR manager prove that jobs in the industry are difficult in the area and denudationing the right talent for the right job and the computer memory of tonicity staff are major HR challenges currently faced by the hotel.The general manager of the hotel is new to her post and has already expressed precautions about the high staff turnover. Turnover is high among social movement line staff, waiters and porters and the steering has had few discussions to find the reasons wherefore staff left, and find out ways to separate the problem. I having worked at the hotel as an HR executive (placement student) managed to gain a total understanding of the high turnover and the possible effects the turnover levels concur had on the existing staff.Literature review drive turnover is the rate at which staff deceases an organisation and are replaced by new employees. Too high a labour turnover rate may mean t hat at that place is something unsatisfactory about functional for the organisation and that action therefore would need to be taken (Adams et al, 1993)Denver and McMahon (1992143) delineate labour turnover as the movement of people into and out of employment within an organisation and can both be uncoerced and involuntary. Eade (1993) further categorises turnover into attention controllable and unavoidable turnover.Labour turnover index is used to mensuration staff turnover and according to Armstrong (2001) labour turnover rates furnish a semiprecious pith to benchmarking the effectiveness of HR policies and practices in organisations.The hotel industry is essentially comprised of both a production and a service aspect and the creation and rendering of services from the hotel to the customer are mainly fall upond by employees. thusly the industry is essentially represented by people (Lewis 1989 Thompson and Abbott, 1990 Schneider , 1993) and is considered as one of the around labour intensive industries. Turnover in the hotel industry in the UK has been shown to be unacceptably high (Kennedy and Berger, 1994), averaging as much as 200% to 300% per year. Statistically this means that the entire work long suit of the industry turns over two to three generation per year. The main factors identified, that could impact on turnover are, orientation and right-hand(a) socialisation procedures (Kennedy and Berger 1994, Woods, 1992), ad-hoc recruitment and selection (Benn and Farbringer, 1992, Woods and Macaulay, 1989 Wagner, 1991 Wheelhouse, 1989), discrimination at the workplace (Antolik,1993), lack of training and development opportunities (Hogan, 1992 rowden,1995), organisation culture (Woods and Macaulay, 1998) shortage of skills in the labour market (Debrah, 1994 Woods, 1992), high levels of work cogitate stress ( Vallen,1993Woods, 1992 Ham and Griffeth, 1995), seasonal personality of the industry ( Boella, 1998) and job dissatisfaction ( Bonn and Frbringer, 1992).All of these factors have contributed towards high levels of staff turnover in the hotel industry and it is suck in that the supremacy of the industry depends upon taking necessary steps to reduce the preceding(prenominal) mentioned issues, and problems, and the calibre of employees, and how headspring they are managed (Nankervis and Debroh, 1995 Berger and Ghel, 1995). Deery and Iverson, (1996) commented that high degree of staff turnover levels consist of recruitment and replacement costs, and regular and loyal customers transmutation to other competitor hotels as they expect to see their favourite staff members.It is stool labour costs evasive action a major part in the industry and high staff turnover is seen as a prime issue bounding the glow surgery of hotel and organisations within the hospitality industry (Obrien and McDonnell 2003). Deery and Iverson (1996) examined the employee turnover phenomenal and fix that high turnover resulted in organisa tions loosing revenue and profits. They also argued that high turnover, especially when competent staff leave, contributes to ponderous the employee morale and the overall ability of teams within the organisations to get quality work done. accordingly the storage of hot and well trained staff in any hospitality organisation is important to moreover unnecessary tangible and intangible costs as well as retaining regular and loyal customers and to provide them with a quality service. It is clear from the arguments put forward by the preceding(prenominal) mentioned authors and scholars but Despite an host of donnish evidence and re attend on labour turnover the question to be asked is do trouble of hospitality sector organisations understand the gravity of the issue of staff turnover, and its negative effects on the performance of the organisation and how far they are willing to go to retain the valuable staff. At a time of difficult economic times it is imperative and organisa tion takes measures to outperform its competitors and any hospitality sector organisation that understands the regard as of gracious capital and adopt favorable HRM policies and management practices in pursuit of employee retention will inescapably outperform the challenger (Cho et al., 2006, Hinkin and Tracy, 2000).Staff leaving on a regular basis involves slow administration costs and a loss of productivity through the breaking up of teams who are used to works together (Denvir and McMohan, 1992144). therefore the critical importance of employees staying with an organisation is evident (Brayfield and Crockett, 1995 Cho et al, 2006). It is clear that squelched and passing cause employees stay with the organisation which in turn helps the company to reduce unnecessary recruitment and selection costs which could amount to a substantial amount of money, but also produce high quality work which helps the organisation to achieve competitive advantage and increase its profits ( Cho et al., 2006 Hinkin and Tracey, 2000).Exit interviews are a expectant method of collecting information as to why employees leave an organisation. Employees leave for several(a) reasons ranging from lack of employee lie organisational measures such as succession planning, compensation , non-financial observes, work flavour balance and undesirable working conditions as well as more personal reasons such as inability to look later on(prenominal)wards their children, other child welfare issues and transport problems. This can also vary depending on how long they have worked for the company and it is a common factor as evident from the High Beech Hotel, and that staff leaves because they forward long lay down out that the job did not suit them. Some other staff members leave after serve the organisation after serving a considerable amount of time and their issues could truly well be different to people leaving early. According to the CIPD (2007) costs an organisation ap proximately 3500 pounds every time an employee leaves and as stated earlier these costs include both tangible costs and intangible costs such as time spent on interviewing new recruits and these often go unreported in company accounts.Denver and McMahon (1992146) also represent out that individual hotel organisations experience different levels of turnover, which helps to confirm that staff turnover is partly within the control of the hotel management. This also contradicts with the common acceptance that staff turnover is high and unvaried throughout the industry and uncontrollable.Therefore it is evident that high levels of staff turnover is harmful to the smooth functioning of any organisation, may it be in the hospitality sector or some other sector and hinders the efficient operation of the business resulting in the hotel lingeringly losing its market share. Therefore it is important that the hospitality sector organisations develop effective and vibrant HRM policies that e nable them to success richly recruit, select and retain skilled and efficient employees, who would contribute towards the achievement of the embodied objectives of the business.Factors influence on high Labour Turnover.The hotel industry in the UK is always debauched with high staff turnover resulting in increased personnel costs arise from recruitment and selection of new staff, training them (Ham and Griffeth, 1995). There is a strong negative relationship in the midst of turnover and organisational load which indicates that staff with low levels of perpetration and loyalty are more likely to withdraw from the organisation than more committed staff (Johnston et, 1993). He also identified a positive relationship mingled with organisational commitment and career superchargeion opportunities given to employees through inner(a) promotions and succession planning. These employees who are given opportunities to progress up the ladder, exhibit higher levels of organisational comm itment, and loyalty and results in skilled staff retention and a gradual lower of low performing employees. This makes it much easier for HR managers to successfully identify low performing employees and obliterate them from the work force which is important and a good for the success of the company as this turnover is considered healthy. other key factor which may influence staff turnover is the sex difference and certain problems it creates within the organisation. effeminate workers have different responsibilities to their male counterparts and may value work life balance more as a result. The pressures of work and life, has resulted in more female person workers leaving their jobs than male workers (Doherty and Manfredi, 200662). In some hotels it can be seen female workers working in the bottom of the organisation power structure and the pay dislocation between males and female workers has been a much talked about issue in the UK. Iverson (2000) conducted a study in the regular army involving hotel establishments and comprise that female managers earn much less than the male managers doing the same job which is ordinarily seen in the UK and this has resulted in, female workers being antipathetic to return to work after their maternity leave. On go of this, most organisations have failed to assist their female workers to arrange necessary child care arrangements which have aggravated the number of female workers leaving their job. As per higher up authors the reluctance of female workers to return to work may also be caused by factors such as stress, work dissatisfaction, lack of commitment and low promotion opportunities united with a poor organisation culture that does not provide a platform to pull ahead female workers to move up the career ladder. Therefore the problems and issues female workers face in the workplace is clear and applicable in hospitality sector organisations, and it is very important the HR department address these iss ues and understand why many female workers leave their jobs early. arrangement culture, average age of the total labour force of the organisation, gender and racial composition and male-female pay gaps are among the reasons why employees leave (Bennett et al, 1993).Prospective employees when joining an organisation look into a number of factors such as career development opportunities, total reward constitution and work life balance. Lack of incentives is therefore a main reason why many employees leave their jobs after some time. Incentives include both financial and nonfinancial and employees may simply want approbation for their good work and lack of light could seriously hamper employee retention. Ritz Carlton hotel in London, has managed to reduce employee turnover to a meaning(a) level by focusing on quality recruitment, providing give way training and development opportunities and by forming a positive psychological contract with the employees, and also by creating long term incentive and reward systems ( Barky, 1996). Therefore it is fair to assume that to a large extent organisation HRM practices, policies and procedures determine staff turnover.Organisation policies and lack of employee oriented practices and procedures may not only be the sole reason why many organisations particularly in the hospitality industry experience high level of staff turnover.Another factor that affects turnover is the ability of staff to carry out their tasks and responsibilities up to the required standard and the job performance of employees largely affects staff turnover and this is also confirmed by a study conducted by Jewell and Siegal (1990). They found that employees having very high levels of on-the-job performance are highly unlikely to leave their job in phone line with employees with low levels of performance. High performing employees are confident in their job and have better work related knowledge and skills. Low pay, lack of training and career dev elopment opportunities, lack of regular and real performance appraisals and un want work environments are among the key reasons that cause low performance which in-turn result in high staff turnover. Therefore it is clear HR professionals in hotel establishments must pay very close attention to developing employee oriented HRM policies and practices that help staff achieve their full potential. To name a few these HR policies and practices are training and development opportunities open management communication systems, employee welfare such as child care, flexible working, transport assistant to employees and a comprehensive induction programme that helps new recruits to adopt well to their new functions.When analysing the hospitality and hotel industry in particular it has been found that most organisations have a poor reputation for providing good staff training and development opportunities (Maxwell et al, 2004). High staff turnover in most hospitality sector industries may ha ve also led managers to be reluctant to providing staff with opportunities to further develop their careers fearing they may leave after that ( Davies et al, 2001, Jameson, 2000 Lowey et al, 2002). High staff turnover also causes managers to be occupied with recruitment and selection activity as well as grievance issues, and this may also be a reason for them not to have sufficient time to focus on staff development and talent management. Training and development and staff retention has a close parallel as poorly trained staff are less satisfied with work and may leave quicker and more than fully trained and highly satisfied staff. Therefore training and development straightaway affects job satisfaction and organisational commitment (Lam and Zhang, 2003, Taylor et al, 2001, Lowry et al, 2002).Working hours is another key factor that causes employees to leave and most hospitality sector organisations, because of high staff turnover may require remaining staff to work extra hours on a regular basis. Long working hours without breaks are against the working time regulations as well as current health and safety rules and Female workers are largely affected by this practice because of their family commitments and a research conducted by Erdogan (199626) revealed long working hours are among the main reasons for many female workers to quit their jobs. There has also been an increase of single parent families and long hours and unsocial working hours have compel females to leave their jobs. This not only creates staff to leave but unfriendly working hours coupled with a poor corporate and work culture and a hostile working environment of the organisation , may affect the job satisfaction of female workers and even if they remain with the job their work could be highly unprofitable and suffer from work related stress. Despite the fact that many researchers and academics stressing the importance of a good organisation work environment that provides employees orient ed HR measures to achieve these goals and objectives many organisations still suffer from high levels of staff turnover and female staff turnover as evident from research findings. All of the above stated factors and elements contribute to employee dissatisfaction and it is a result of various knowledgeable and outside(a) factors that were mentioned above.Labour turnover of High Beech HotelHigh Beech Hotel had a newly appointed general manager and she has been investigating the reasons for the high staff turnover levels of the hotel over the past three years and has had several discussions with the operations manager and the HR manager of the company. Unfortunately no proper investigation has not been done so far to find out the possible causes of staff turnover but the management in consultation with the company HR records and turnover figures has assumed the reasons as job dissatisfaction, long and unfriendly working hours, pay issues, lack of training and development opportunit ies for staff, issues with working condition and other personal issues of staff such as work life balance. splendor of HR practices and concepts in relation to staff retention and turnoverHRM plays a critical part in creating a sustainable competitive advantage for any organisation, and forward looking organisations adopt good HR policies and practices to ensure the smooth functioning of the organisation (Edvinsson and Malone, 1997 Stewart, 1997 Verma and Dewe, 2008). Research studies have confirmed that well outlined organisational goals and corporate objectives directly influence employee retention and productivity. Kim et al, (2005) in their study on corporate orientation found that organisational concern and support had a significant impact on employee job satisfaction and overall commitment.ORGANISATIONAL INITIATIVESThe organisational HR initiatives as mentioned above, illustrate how intrinsic factors and forces contribute towards employee retention. The stick does not ment ion about external forces such as local and national competition in the labour market, economic situation, globalisation and international competition which affects attracting skilled employees to various jobs. It can be seen that this model covers the internal factors and reasons that affect staff retention or turnover and it is critically important for an organisation and HR professionals to pay close attention to the factors mentioned under the model to critically assess where they stand as an organisation and take steps to implement those HR practices and policies to retain sharp staff ( Horwitz et al, 2003 Steel et al, 2002). These internal HR policies and practices are bundled under the term retention management and it is defined as the ability to hold onto those employees an organisation would want to keep, for longer than the competitors (Johnson,2000 cited De Vos and Meganck,2007). The external factors should not be overleap at the same time because there may be times emp loyees may leave an organisation due to their influences.The impact of financial and non-financial rewards cannot be undermined and play a critical role in motivation skilled and determine employees and retaining them within the organisation. Financial rewards such as a good radical pay combined with performance related pay and non-financial rewards such as training and development opportunities, initiatives to achieve work life balance for staff and other employee retention initiatives such as a pensions outline and internal promotions motivate staff and force them to think again before quitting their jobs (Horwitz et al,2003De Vos and Meganck, 2007).When analysing the theories and ides put forward by the above mentioned academics and scholars it is evident they focused on retaining highly skilled employees and researched to find out the possible reasons why valued employees leave organisations. This is being described as retention management and the word retention embraces with other HR practices such as recruitment and selection, development of employees to achieve their full potential and succession management (Lewis and Heckmanp 2006140).HR Practices and the importance of Human PsychologyHRM involves all management decisiveness and practices that directly affects other people, or human resources, who work for the organisation. The question that arises is that despite the fact that many organisations including the hospitality and hotel industry, implement all genuine HR practices and procedures, why employees still leave and the staff turnover rates are extremely high. A good understanding of the implications of human psychology would help HR managers to find the root causes to this problem.Psychologist Abraham Maslow introduced his concept of hierarchy of necessitate in 1943 which suggests that people are motivated to fulfil their basic human call for before go on to other inevitably. The hierarchy of needs is displayed as a gain and the lowest l evel of the pyramid are made up of the most basic needs, while the more complex needs are at the top. The needs located at the bottom are the most basic human needs and as people progress up the pyramid, needs become increasingly psychological and social. Therefore when it comes to employees staying or leaving a particular organisation which gunpoint the employee is in could play a vital role in his or her decision reservation process. At the core this theory of Maslow suggests that when an individual satisfies one set of needs they always try to move into the other level.This makes it critically important for HR professionals in the hospitality organisations how this theory of Maslow affects individual employees and how it influences an individuals decision about him staying or leaving the organisation. When an individual joins an organisation the first concern is to organise his life in-terms of food shelter and other essential psychological needs through contend and salary. Th e coterminous concern would be job security and personal health and safety in the job. Once those needs are satisfied the employee would move in to the other set of needs which are social needs such as friendly colleagues and staff as well as a desirable working environment. After this comes the next stage which is satisfying the esteem needs which is comprised of individual being prize for his work and valued by the management of the organisation as well as taking full advantage of any courses and exams they could take to get promoted. Once this set of needs are fully satisfied the employee reaches the stage of self actualisation.Therefore to satisfy the individual employee needs the HR executives working in hospitality sector organisations must understand the needs of employees and aim to provide tailor made HR solutions in line with the corporate strategy of the company. In order to accomplish this, the HR managers must have absolute methods and procedures to understand which stage the employee is in his hierarchy of needs because if this is not done or if the right methods and procedures are not in place there will inevitably be a contradiction. For an ideal the HR managers may direct their full efforts into satisfying the esteem needs of employees through individual cognizance and internal promotions at work when the employees are seeking safety needs. This would result in a toss off of company resources and employees considering leaving the organisation.Individuals decision making processAn individuals decision making process is comprised of a number of internal and external variables as shown below and the final decision makes by an individual employee is made up of a collection of those internal and external variables. This model is highly useful in understanding an employees decision making in an organisation (Kotler, 2000, p98).As seen the model is comprised of five main stages which an individual may go through before coming into a decision. T hey are,* Problem recognition* Information search* Evaluation of alternatives* conclusion to leave or stay* Post- bargain for ratingTherefore the first stage is problem recognition and that is recognising there is a problem or issue to be answered by the employee. The problem arose can be triggered by internal influences, external influences or both.Once the main problem or problems are treasure by the employee he then moves into the next stage which is information search. For an example if the initial problem recognised by the employee is concerned with training and development opportunities offered by the organisation then through information search he would try to gather as much information as possible through various external and internal sources about what actions and steps he could take in order to gain the desired level of training.The next stage once sufficient information is gathered is the evaluation of alternatives. As per with training and development, the employee i n this stage will go through various possible courses to be taken and tax the rightness of those courses to his job and what help he could get from the organisation in order to take the course.The next stage of the process is the final decision of the employee to stay with the organisation or to leave. This is called the purchase decision and according to Kotler (2000, p 99) two factors can intervene between the purchase intention and purchase decision. The first factor is the attitudes of other people, which is what the others around think of the individuals decision. Influence of other people can become complex and vary when there are more than one persons involved. The second factor Kotler (2000,p 99) mentions is the unanticipated or unexpected situations and as per the above example of training and development, factors such as the recession and cost cutting measures by the organisation could hamper the employees aspiration of embarking on the course.The final stage of the dec ision making process is the post purchase evaluation which involves the employee evaluating the positives and negatives of the decision taken, and the possible consequences of it.This concept has a high degree of importance to HR even though it is widely used in marketing and regarded more as a marketing related concepHigh Staff Turnover in Hotel IndustryHigh Staff Turnover in Hotel IndustryHotels, catering and leisure industry in the UK remains the sector with the highest level of staff turnover, with all leavers in this category hitting 41%, according to a survey carried out by the CIPD (2008).Many organisations are badly affected by high levels of staff turnover and the survey identified that 74% of organisations in the UK, reported a negative impact on their business performance. This report also identified four main reasons that cause labour turnover. They are, change of career (55%), promotions outside of the company (45%), level of pay (41%) and lack of career development (33 %).Employee dissatisfaction caused by poor relationships with supervisors and line managers, undesirable working conditions and lack of career development and training opportunities are also seen as major factors that cause high staff turnover ( Griffeth, Hom and Gaertner 2000). As mentioned in an article published by the Adecco Institute (2008) skills shortage in the jobs market is seen as a major human resources challenge for the future and this is particularly true of the hospitality and leisure industry in the UK, as it has suffered from constant recruitment difficulties over the past so many years. Age positive carried out a survey in the year 2005 and according to the results of the survey nearly 40% of all vacancies in the hospitality industry were hard to fill and much of the problem has been caused by poor retention strategies implemented by organisations. Another factor identified by the survey with regard to why so many vacancies were hard to fill is the lack of necessary skills and abilities by potential applicants who apply for jobs in the hotel and hospitality industry. A similar percentage of employers who participated in the survey stated that applicants lack excellent communication skills required, and this is particularly true of receptionists, managers and administrators and this has created immense pressure on HR executives and managers to attract, manage and retain key talent within their organisation which is an essential factor in creating sustainable competitive advantage. The results and information unearthed from these surveys make it crystal clear that high levels of staff turnover is a major problem to all organisations and the HR department of an organisation has a key responsibility of closely monitor labour turnover levels and figures and make right steps in order to bring staff turnover to a manageable level and face the future with resistance.High levels of staff turnover in an organisation may compromise the quality and high s tandards of customer service, and may impact on the organisation loosing loyal customers, revenue and long term sustainability (Tracy and Hinkin, 2008). Once the well established staff leave a company it may not only increase the workload of the remaining staff members of the company, but would be difficult for the organisation to gain the same highest levels of service from the newly hired staff as they would still be in a period of learning their job, and other key tasks and responsibilities associated with the job. Furthermore when employees leave on a regular basis it creates extra workloads for the remaining staff and as a result they could become depressed with work and not be able to deliver their best performance on the job. This may further exacerbate the problem and may also result in staff getting absent from work regularly and their good health deteriorate.The article of Tracy and Hinkin (2008) also states financial implications for organisations as a result of high leve ls of staff turnover. The costs associated with replacing staff can be sorted into hard costs, soft costs, and opportunity costs. Hard costs are costs such as money spent on newspaper advertisements, adverts on recruitment agencies etc, and they have a direct impact on the organisation. Other elements such as the time it takes to interview new recruits, and time spent on exit interviews will not be shown in company account statements as they are regarded as soft costs. Opportunity costs such as missed customers and market shares, usually go unmeasured but can still be substantial and may also lower company profitability and competitor advantage of the organisation ( Simons and Hinkin 2001 cited Tracy.J and Hinkin.T, 2008).The following five are identified as major costs categories that contribute towards the total costs of replacing an employee. They are pre-departure, recruitment, selection, orientation and training, and lost productivity (Hinkin and Tracy 2007, 2006, cited Tracy.J and Hinkin.T,2008). The already high staff turnover rates in the hotel industry also reflects high turnover of newly selected staff who leave the company within their first 30 days because the job did not suit them (Woods,1997141). Does this mean possible issues with the prevailing recruitment and selection methods adopted by the hospitality sector organisations?According to the article by Tracy.J and Hinkin.T, only a few turnover studies have been so far carried out in the hotel and hospitality sector, despite reporting high levels of turnover every year. Therefore my literature review aims to conduct a much broader view of this issue by critically examining the current procedures and practices carried out by the High Beech Hotel UK and some of the other local selected competitor hotels, which may be associated with employee turnover. By doing so this study aims to understand the root causes of high levels of employee turnover of High Beech Hotel and propose solutions and recommen dations to overcome those issues. This research benefits High Beech Hotel in terms of minimising the unnecessary costs that may occur due to advertising, interviewing, training of new staff as well as improving the overall standard of the hotel.High Beech Hotel is a three start hotel located in beautiful Hastings area and is faced with stiff competition with many three to four star hotels operating in the area such as, The White Rock Hotel, Travelodge Hastings, The Hotel Undum and the Chatsworth Hotel.The High Beech Hotel is therefore fighting to maintain a sustainable competitive advantage and grow its market share. The opinions of the General Manager, Operations Manager and the HR manager prove that jobs in the industry are difficult in the area and finding the right talent for the right job and the retention of quality staff are major HR challenges currently faced by the hotel.The general manager of the hotel is new to her post and has already expressed concerns about the high st aff turnover. Turnover is high among front line staff, waiters and porters and the management has had few discussions to find the reasons why staff left, and find out ways to resolve the problem. I having worked at the hotel as an HR executive (placement student) managed to gain a good understanding of the high turnover and the possible effects the turnover levels have had on the existing staff.Literature reviewLabour turnover is the rate at which staff leaves an organisation and are replaced by new employees. Too high a labour turnover rate may mean that there is something unsatisfactory about working for the organisation and that action therefore would need to be taken (Adams et al, 1993)Denver and McMahon (1992143) defined labour turnover as the movement of people into and out of employment within an organisation and can both be voluntary and involuntary. Eade (1993) further categorises turnover into management controllable and unavoidable turnover.Labour turnover index is used t o measure staff turnover and according to Armstrong (2001) labour turnover rates provide a valuable means to benchmarking the effectiveness of HR policies and practices in organisations.The hotel industry is essentially comprised of both a production and a service aspect and the creation and rendering of services from the hotel to the customer are mainly achieved through employees. Therefore the industry is essentially represented by people (Lewis 1989 Thompson and Abbott, 1990 Schneider , 1993) and is considered as one of the most labour intensive industries. Turnover in the hotel industry in the UK has been shown to be unacceptably high (Kennedy and Berger, 1994), averaging as much as 200% to 300% per year. Statistically this means that the entire workforce of the industry turns over two to three times per year. The main factors identified, that could impact on turnover are, orientation and good socialisation procedures (Kennedy and Berger 1994, Woods, 1992), ad-hoc recruitment an d selection (Benn and Farbringer, 1992, Woods and Macaulay, 1989 Wagner, 1991 Wheelhouse, 1989), discrimination at the workplace (Antolik,1993), lack of training and development opportunities (Hogan, 1992 rowden,1995), organisation culture (Woods and Macaulay, 1998) shortage of skills in the labour market (Debrah, 1994 Woods, 1992), high levels of work related stress ( Vallen,1993Woods, 1992 Ham and Griffeth, 1995), seasonal nature of the industry ( Boella, 1998) and job dissatisfaction ( Bonn and Frbringer, 1992).All of these factors have contributed towards high levels of staff turnover in the hotel industry and it is clear that the success of the industry depends upon taking necessary steps to reduce the above mentioned issues, and problems, and the calibre of employees, and how well they are managed (Nankervis and Debroh, 1995 Berger and Ghel, 1995). Deery and Iverson, (1996) commented that high degree of staff turnover levels consist of recruitment and replacement costs, and re gular and loyal customers switching to other competitor hotels as they expect to see their favourite staff members.It is clear labour costs play a major part in the industry and high staff turnover is seen as a prime issue hampering the smooth functioning of hotel and organisations within the hospitality industry (Obrien and McDonnell 2003). Deery and Iverson (1996) examined the employee turnover phenomenal and found that high turnover resulted in organisations loosing revenue and profits. They also argued that high turnover, especially when skilled staff leave, contributes to lowering the employee morale and the overall ability of teams within the organisations to get quality work done.Therefore the retention of skilled and well trained staff in any hospitality organisation is important to save unnecessary tangible and intangible costs as well as retaining regular and loyal customers and to provide them with a quality service. It is clear from the arguments put forward by the above mentioned authors and scholars but Despite an array of academic evidence and research on labour turnover the question to be asked is do management of hospitality sector organisations understand the gravity of the issue of staff turnover, and its negative effects on the performance of the organisation and how far they are willing to go to retain the valuable staff. At a time of difficult economic times it is imperative and organisation takes measures to outperform its competitors and any hospitality sector organisation that understands the value of human capital and adopt good HRM policies and management practices in pursuit of employee retention will inevitably outperform the competition (Cho et al., 2006, Hinkin and Tracy, 2000).Staff leaving on a regular basis involves heavy administration costs and a loss of productivity through the breaking up of teams who are used to working together (Denvir and McMohan, 1992144). Therefore the critical importance of employees staying with an organisation is evident (Brayfield and Crockett, 1995 Cho et al, 2006). It is clear that satisfied and highly motivated employees stay with the organisation which in turn helps the company to reduce unnecessary recruitment and selection costs which could amount to a substantial amount of money, but also produce high quality work which helps the organisation to achieve competitive advantage and increase its profits (Cho et al., 2006 Hinkin and Tracey, 2000).Exit interviews are a great method of collecting information as to why employees leave an organisation. Employees leave for various reasons ranging from lack of employee oriented organisational measures such as succession planning, pay , non-financial rewards, work life balance and undesirable working conditions as well as more personal reasons such as inability to look after their children, other child welfare issues and transport problems. This can also vary depending on how long they have worked for the company and it is a comm on factor as evident from the High Beech Hotel, and that staff leaves because they soon found out that the job did not suit them. Some other staff members leave after serving the organisation after serving a considerable amount of time and their issues could very well be different to people leaving early. According to the CIPD (2007) costs an organisation approximately 3500 pounds every time an employee leaves and as stated earlier these costs include both tangible costs and intangible costs such as time spent on interviewing new recruits and these often go unreported in company accounts.Denver and McMahon (1992146) also found out that individual hotel organisations experience different levels of turnover, which helps to confirm that staff turnover is partly within the control of the hotel management. This also contradicts with the common acceptance that staff turnover is high and uniform throughout the industry and uncontrollable.Therefore it is evident that high levels of staff tu rnover is harmful to the smooth functioning of any organisation, may it be in the hospitality sector or some other sector and hinders the efficient operation of the business resulting in the hotel gradually losing its market share. Therefore it is important that the hospitality sector organisations develop effective and vibrant HRM policies that enable them to successfully recruit, select and retain skilled and efficient employees, who would contribute towards the achievement of the corporate objectives of the business.Factors influence on high Labour Turnover.The hotel industry in the UK is constantly troubled with high staff turnover resulting in increased personnel costs arise from recruitment and selection of new staff, training them (Ham and Griffeth, 1995). There is a strong negative relationship between turnover and organisational commitment which indicates that staff with low levels of commitment and loyalty are more likely to withdraw from the organisation than more committ ed staff (Johnston et, 1993). He also identified a positive relationship between organisational commitment and career progression opportunities given to employees through internal promotions and succession planning. These employees who are given opportunities to progress up the ladder, exhibit higher levels of organisational commitment, and loyalty and results in skilled staff retention and a gradual decline of low performing employees. This makes it much easier for HR managers to successfully identify low performing employees and eliminate them from the work force which is important and a good for the success of the company as this turnover is considered healthy.Another key factor which may influence staff turnover is the gender difference and certain problems it creates within the organisation. Female workers have different responsibilities to their male counterparts and may value work life balance more as a result. The pressures of work and life, has resulted in more female worke rs leaving their jobs than male workers (Doherty and Manfredi, 200662). In most hotels it can be seen female workers working in the bottom of the organisation hierarchy and the pay gap between males and female workers has been a much talked about issue in the UK. Iverson (2000) conducted a study in the USA involving hotel establishments and found that female managers earn much less than the male managers doing the same job which is commonly seen in the UK and this has resulted in, female workers being reluctant to return to work after their maternity leave. On top of this, most organisations have failed to assist their female workers to arrange necessary child care arrangements which have aggravated the number of female workers leaving their job. As per above authors the reluctance of female workers to return to work may also be caused by factors such as stress, work dissatisfaction, lack of commitment and low promotion opportunities coupled with a poor organisation culture that doe s not provide a platform to encourage female workers to move up the career ladder. Therefore the problems and issues female workers face in the workplace is clear and applicable in hospitality sector organisations, and it is very important the HR department address these issues and understand why many female workers leave their jobs early. Organisation culture, average age of the total labour force of the organisation, gender and racial composition and male-female pay gaps are among the reasons why employees leave (Bennett et al, 1993).Prospective employees when joining an organisation look into a number of factors such as career development opportunities, total reward policy and work life balance. Lack of incentives is therefore a main reason why many employees leave their jobs after some time. Incentives include both financial and nonfinancial and employees may simply want praise for their good work and lack of recognition could seriously hamper employee retention. Ritz Carlton ho tel in London, has managed to reduce employee turnover to a significant level by focusing on quality recruitment, providing better training and development opportunities and by forming a positive psychological contract with the employees, and also by creating long term incentive and reward systems ( Barky, 1996). Therefore it is fair to assume that to a large extent organisation HRM practices, policies and procedures determine staff turnover.Organisation policies and lack of employee oriented practices and procedures may not only be the sole reason why many organisations particularly in the hospitality industry experience high level of staff turnover.Another factor that affects turnover is the ability of staff to carry out their tasks and responsibilities up to the required standard and the job performance of employees largely affects staff turnover and this is also confirmed by a study conducted by Jewell and Siegal (1990). They found that employees having very high levels of on-th e-job performance are highly unlikely to leave their job in contrast with employees with low levels of performance. High performing employees are confident in their job and have better work related knowledge and skills. Low pay, lack of training and career development opportunities, lack of regular and realistic performance appraisals and undesired work environments are among the key reasons that cause low performance which in-turn result in high staff turnover. Therefore it is clear HR professionals in hotel establishments must pay very close attention to developing employee oriented HRM policies and practices that help staff achieve their full potential. To name a few these HR policies and practices are training and development opportunities open management communication systems, employee welfare such as child care, flexible working, transport assistant to employees and a comprehensive induction programme that helps new recruits to adopt well to their new roles.When analysing the hospitality and hotel industry in particular it has been found that most organisations have a poor reputation for providing good staff training and development opportunities (Maxwell et al, 2004). High staff turnover in most hospitality sector industries may have also led managers to be reluctant to providing staff with opportunities to further develop their careers fearing they may leave after that ( Davies et al, 2001, Jameson, 2000 Lowey et al, 2002). High staff turnover also causes managers to be occupied with recruitment and selection activity as well as grievance issues, and this may also be a reason for them not to have sufficient time to focus on staff development and talent management. Training and development and staff retention has a close match as poorly trained staff are less satisfied with work and may leave quicker and more than fully trained and highly satisfied staff. Therefore training and development directly affects job satisfaction and organisational commitment (Lam and Zhang, 2003, Taylor et al, 2001, Lowry et al, 2002).Working hours is another key factor that causes employees to leave and most hospitality sector organisations, because of high staff turnover may require remaining staff to work extra hours on a regular basis. Long working hours without breaks are against the working time regulations as well as current health and safety rules and Female workers are largely affected by this practice because of their family commitments and a research conducted by Erdogan (199626) revealed long working hours are among the main reasons for many female workers to quit their jobs. There has also been an increase of single parent families and long hours and unsocial working hours have forced females to leave their jobs. This not only creates staff to leave but unfriendly working hours coupled with a poor corporate and work culture and a hostile working environment of the organisation , may affect the job satisfaction of female workers and even if they remain with the job their work could be highly unproductive and suffer from work related stress. Despite the fact that many researchers and academics stressing the importance of a good organisation work environment that provides employees oriented HR measures to achieve these goals and objectives many organisations still suffer from high levels of staff turnover and female staff turnover as evident from research findings. All of the above stated factors and elements contribute to employee dissatisfaction and it is a result of various internal and external factors that were mentioned above.Labour turnover of High Beech HotelHigh Beech Hotel had a newly appointed general manager and she has been investigating the reasons for the high staff turnover levels of the hotel over the past three years and has had several discussions with the operations manager and the HR manager of the company. Unfortunately no proper investigation has not been done so far to find out the possible causes of staff turnover but the management in consultation with the company HR records and turnover figures has assumed the reasons as job dissatisfaction, long and unfriendly working hours, pay issues, lack of training and development opportunities for staff, issues with working condition and other personal issues of staff such as work life balance.Importance of HR practices and concepts in relation to staff retention and turnoverHRM plays a vital part in creating a sustainable competitive advantage for any organisation, and forward looking organisations adopt good HR policies and practices to ensure the smooth functioning of the organisation (Edvinsson and Malone, 1997 Stewart, 1997 Verma and Dewe, 2008). Research studies have confirmed that well defined organisational goals and corporate objectives directly influence employee retention and productivity. Kim et al, (2005) in their study on corporate orientation found that organisational direction and support had a significant impact on employee job satisfaction and overall commitment.ORGANISATIONAL INITIATIVESThe organisational HR initiatives as mentioned above, illustrate how internal factors and forces contribute towards employee retention. The model does not mention about external forces such as local and national competition in the labour market, economic situation, globalisation and international competition which affects attracting skilled employees to various jobs. It can be seen that this model covers the internal factors and reasons that affect staff retention or turnover and it is critically important for an organisation and HR professionals to pay close attention to the factors mentioned under the model to critically assess where they stand as an organisation and take steps to implement those HR practices and policies to retain talented staff ( Horwitz et al, 2003 Steel et al, 2002). These internal HR policies and practices are bundled under the term retention management and it is defined as the abilit y to hold onto those employees an organisation would want to keep, for longer than the competitors (Johnson,2000 cited De Vos and Meganck,2007). The external factors should not be neglected at the same time because there may be times employees may leave an organisation due to their influences.The impact of financial and non-financial rewards cannot be undermined and play a critical role in motivating skilled and valued employees and retaining them within the organisation. Financial rewards such as a good basic pay combined with performance related pay and non-financial rewards such as training and development opportunities, initiatives to achieve work life balance for staff and other employee retention initiatives such as a pensions scheme and internal promotions motivate staff and force them to think again before quitting their jobs (Horwitz et al,2003De Vos and Meganck, 2007).When analysing the theories and ides put forward by the above mentioned academics and scholars it is evide nt they focused on retaining highly skilled employees and researched to find out the possible reasons why valued employees leave organisations. This is being described as retention management and the word retention embraces with other HR practices such as recruitment and selection, development of employees to achieve their full potential and succession management (Lewis and Heckmanp 2006140).HR Practices and the importance of Human PsychologyHRM involves all management decision and practices that directly affects other people, or human resources, who work for the organisation. The question that arises is that despite the fact that many organisations including the hospitality and hotel industry, implement all accepted HR practices and procedures, why employees still leave and the staff turnover rates are extremely high. A good understanding of the implications of human psychology would help HR managers to find the root causes to this problem.Psychologist Abraham Maslow introduced his concept of hierarchy of needs in 1943 which suggests that people are motivated to fulfil their basic human needs before moving on to other needs. The hierarchy of needs is displayed as a pyramid and the lowest level of the pyramid are made up of the most basic needs, while the more complex needs are at the top. The needs located at the bottom are the most basic human needs and as people progress up the pyramid, needs become increasingly psychological and social. Therefore when it comes to employees staying or leaving a particular organisation which stage the employee is in could play a vital role in his or her decision making process. At the core this theory of Maslow suggests that when an individual satisfies one set of needs they always try to move into the other level.This makes it critically important for HR professionals in the hospitality organisations how this theory of Maslow affects individual employees and how it influences an individuals decision about him staying or lea ving the organisation. When an individual joins an organisation the first concern is to organise his life in-terms of food shelter and other essential psychological needs through wages and salary. The next concern would be job security and personal health and safety in the job. Once those needs are satisfied the employee would move in to the other set of needs which are social needs such as friendly colleagues and staff as well as a desirable working environment. After this comes the next stage which is satisfying the esteem needs which is comprised of individual being recognised for his work and valued by the management of the organisation as well as taking full advantage of any courses and exams they could take to get promoted. Once this set of needs are fully satisfied the employee reaches the stage of self actualisation.Therefore to satisfy the individual employee needs the HR executives working in hospitality sector organisations must understand the needs of employees and aim t o provide tailor made HR solutions in line with the corporate strategy of the company. In order to accomplish this, the HR managers must have accurate methods and procedures to understand which stage the employee is in his hierarchy of needs because if this is not done or if the right methods and procedures are not in place there will inevitably be a contradiction. For an example the HR managers may direct their full efforts into satisfying the esteem needs of employees through individual recognition and internal promotions at work when the employees are seeking safety needs. This would result in a waste of company resources and employees considering leaving the organisation.Individuals decision making processAn individuals decision making process is comprised of a number of internal and external variables as shown below and the final decision makes by an individual employee is made up of a collection of those internal and external variables. This model is highly useful in understan ding an employees decision making in an organisation (Kotler, 2000, p98).As seen the model is comprised of five main stages which an individual may go through before coming into a decision. They are,* Problem recognition* Information search* Evaluation of alternatives* Decision to leave or stay* Post- purchase evaluationTherefore the first stage is problem recognition and that is recognising there is a problem or issue to be answered by the employee. The problem arose can be triggered by internal influences, external influences or both.Once the main problem or problems are recognised by the employee he then moves into the next stage which is information search. For an example if the initial problem recognised by the employee is concerned with training and development opportunities offered by the organisation then through information search he would try to gather as much information as possible through various external and internal sources about what actions and steps he could take i n order to gain the desired level of training.The next stage once sufficient information is gathered is the evaluation of alternatives. As per with training and development, the employee in this stage will go through various possible courses to be taken and evaluate the appropriateness of those courses to his job and what help he could get from the organisation in order to take the course.The next stage of the process is the final decision of the employee to stay with the organisation or to leave. This is called the purchase decision and according to Kotler (2000, p 99) two factors can intervene between the purchase intention and purchase decision. The first factor is the attitudes of other people, which is what the others around think of the individuals decision. Influence of other people can become complex and varied when there are more than one persons involved. The second factor Kotler (2000,p 99) mentions is the unanticipated or unexpected situations and as per the above exampl e of training and development, factors such as the recession and cost cutting measures by the organisation could hamper the employees aspiration of embarking on the course.The final stage of the decision making process is the post purchase evaluation which involves the employee evaluating the positives and negatives of the decision taken, and the possible consequences of it.This concept has a high degree of importance to HR even though it is widely used in marketing and regarded more as a marketing related concep