Managing Human Resources Challenges in Chinese Hospitality Industry

Research Paper (undergraduate), 2012

21 Pages, Grade: 70,0


Table of Contents


Main Body
- I. Managing Human Resources in the Hospitality Industry
- II. Challenges of Managing Human Resources in the Hospitality Industry



The Reference List



The purpose of this project w as to explore the possible challenges that could have been undertaken while managing Human Resources in Chinese hospitality industry. Above all, we have investigated in various industry experts’ HR practices in luxury hotel properties located both in China and USA and we have chosen to make a comparison amongst them. We have found that luxury hotels that w ant to achieve international levels of service quality ought to invest more time in hiring and training their Chinese staff.

The research on that field and the further investigation on Hospitality Industry show ed that the relationship amongst perceived human resources practices and hotel staff’s opinion is differentiated enough mainly because of Chinese hotel employees characteristic. That is their identified characteristic of lacking service mentality due to Chinese hotels’ policy of hiring staff based on personality traits and not on service mentality aspects. Furthermore, cultural differences and as well as institutional differences in human resources account for the differences that exist between Chinese staff in the hospitality industry in China and in United States of America.


The Challenges of Human Resources in Hospitality Industry have been a topic of extensiv e research, in the past and recent years. The hospitality industry is now adays demanding not only more productivity and cost efficacies, but also more positive interpersonal reactions betw een customers and staff. With grow th declining both in Europe and in USA, international hotel chains are being attracted by Chinese Hotel industry for their expansion. Shanghai, is one of the most attractive locations, because it is seen as the major city in Asia w here the high level of recognized w ould continue their grow th, fulfilled in large part by (FDI)- Foreign Direct Investment. Chinese regional cities like; ‘ Hannan ’ , are perceived as underdeveloped and have growth potentials. They were key markets for the World Expo in 2006. More interestingly, a major European luxury hotel operator entitled; ‘ Accor ’ , in 2006 announced its plans to open three leading hotels in the year of 2007. In the same year, Marriot International was planning to have established 30 Chinese hotels and more than 10,000 rooms undertaken by its control by the end of that year. Given that, the human resources function has a vital role in the success of a services- oriented business venture, a better understanding of the human resources dynamics in China could enhance the success of the companies chosen to invest there, also including Chinese companies who are willing to compete with Western companies (Ferreira, T and Alon, I (2008).

In many cities of China, a stay at a foreign managed luxury hotel is compared to a stay in a hotel of the same category or level in any of the major USA cities. Although, the hotel industry in China has experienced difficult circumstances over the years, due to inadequate infrastructure, lacking service mentality of its hotel employees, political issues, high turnover, health oriented issues (SARS, bird flu et cetera), and most significantly the Asian financial crisis. China also reports some unique challenges in relation to human resources management, also Western companies have a developed stake w hen trying to figure out w ays to best manage their properties under the Chinese culture (Ferreira, T and Alon, I (2008).

The purpose of this study is to underline some of the distinctive situations a luxury hotel property is facing in China, in relation to its human resources practices and implications , such as hiring and training employee policies so to provide international levels of service. The use of organizational practices in various countries is a vital way under which multinational companies tend to leverage their know ledge so to formulate and maintain their competitive advantage (Ferreira, T and Alon, I (2008).

This study seeks to examine in more detail the interactions amongst the local (Chinese) and a more globalized, international culture, involving an ‘in-depth’ research that utilizes case analysis and interviewing of key individuals on chosen hotel properties as a basis for drawing its conclusions.

Case studies such as this one, allow one for a detailed more inductive examination under which generalized conclusions may be drawn (Ellet, 2007) .

This analysis w ill help to create a better understanding of the human resources state w hich the hospitality industry is facing in China, and its implications to the globalization of both Chinese and International Companies. Furthermore, it offers insight on best practices and as well as pitfalls to avoid, when utilizing Chinese staff to expand in global sector (Ferreira, T and Alon, I (2008).

Main Body

I.Managing Human Resources In the Hospitality Industry

A lot has been w ritten regarding the overall development of the hotel industry in China, w ith most studies looking at the industry from a financial/growth perspective. In addition, some research has been done on the hr challenges the hospitality industry is facing, as HR become one of the most difficult aspects to replicate in a cross-border knowledge transfer. The literature review s underlines that one of the major challenges encountered by luxury hotel properties in China, is the lack of qualified professionals, especially managers, creating a need for highly intensive training programmes at all levels of the company (Ferreira, T and Alon, I (2008).

According to; Hospitality Magazine, the industry is hampered by a lack of qualified staff, a high-turnover rate and the non-willingness of university graduates to join the industry. In addition, there is a big gap between what is taught in schools and what is happening in the real w orld (Zhang and Wu, 2004).

The lack of managerial training programmes w hich are rarely given to locals, cause shortages due to; lacking creativity, aptitude for risk-taking and inability to effectively manage other people (The Economist, 2005).

All of the above mentioned, do occur also because of inefficient translation of English language to Chinese of the hotel educational resources in colleges.

About 30 to 40 expatriates are hired to open an international luxury chain hotel in China, and those expatriates are expensive to the companies, since their packages usually undertake living costs, upgraded salaries compared to a Chinese citizen employed in the same position. Other significant factors to be considered are the; high - turnover rates. Until 1983, the Chinese w ere not allow ed to choose their career path. But after the economic reform, they w ere free to choose their own jobs.

Economic grow th and new governmental policies have given the Chinese staff more alternative options and some companies have to advance their salaries and offer better working conditions for recruitment and thus, to retain staff (Clouse, 2006). By lacking staff culture, the staff usually tend to leave their employer, so to get employed elsew here even w ith a minor increase in their salaries.

It has to be also noted, that International hotel chains implement a more international hiring and recruitment approach even in the Chinese market (Ferreira, T and Alon, I (2008). One of the cultural barriers undertaken may be regarding China’s “ collectivist society ” .

That is because it is difficult for Chinese staff to express their personal thinking, and in many cases, that they have to take a decision in seconds, they are unable.

That aspect is extremely crucial for the hotel industry, in w hich time means everything.

For example, by saying something inappropriate or by making the w rong judgment, the Chinese employee will feel threatened and will choose to change its current job position to that of another company’s.

Moreover, due to those characteristics, younger hotel staff tends not to take the initiative when it’s required despite their high educational background.

That relates to loss of self- confidence due to low - confidence family ‘role - models’ such as; their parents always working for state - owned firms (Ferreira, T and Alon, I (2008).


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Managing Human Resources Challenges in Chinese Hospitality Industry
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HRM, Management, Business, Hospitality, Hospitality Industry, Tourism Industry, Chinese Hospitality Industry, Chinese, English, Paper, Academic, Essay, Postgraduate
Quote paper
Anna Stavroudi (Author), 2012, Managing Human Resources Challenges in Chinese Hospitality Industry, Munich, GRIN Verlag,


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