Human Resource Management as a competitive advantage

Essay by musgravejamesUniversity, Master'sC+, November 2006

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In the International Hospitality market competition is an issue of services and products. Much attention has been directed to a better service and the best product and how this can be achieved through utilising the human resource, (Adorka, 1996).

Understanding sources of competitive advantage has become a major area of research in the field of strategic management, (Handy, 1999). None more so than in the Hospitality sector, where differentiation is key to delivering financial success in such a highly perishable, inimitable and subjective industry, (Lockwood & Jones, 1994). From experience, it is the human assets that are a key source of sustainable advantage. However, this utopian ideology is hard to achieve in an industry characterised by high labour turnover, poor perceptions as employers and stressful working conditions, (Berta, 2003). Moreover, 75% of the hospitality workforce in the UK are under 25, (People 1st, Market Assessment, 2004), corollary forging a very transient work culture that is hard to revolutionise.

Nonetheless, Guest 1990, cited in Beardwell & Holden et al, 2004 states that if management trust their workers and gives them challenging assignments, these workers in return will respond with high motivation, high commitment and high performance. Moreover, it can be argued that the sources of competitive advantage have shifted from financial resources to human. Royal Caribbean Cruise Line employs a strategy that incorporates Pfeffer's sixteen practices of competitive advantages, cited in Beardwell and Holden, 2004. Here, the company gives "signing on incentives" for key members of staff, personal development and progression within the fleet. For example, they offer one-week shore leave to gain intensive health and safety training. Moreover, customer feedback scores are key indicators for success and bonus performance related privileges which are an integral part of the job. Within this environment the majority of wages is tip based and...