Selection and Measurement of Hotel Human Resource Metrics

By Robert M. O'Halloran Professor & Director, School of Hospitality Leadership, East Carolina University | March 05, 2017

In a world of assessment and evaluation, the questions are clearly, who, what and how are operations measured for success and what data are needed to make the optimal decisions in a business? Thereís a business saying ďif you canít measure it, you canít manage itĒ? Real responsive management needs reliable and truthful figures on which decisions can be made (profitablehospitality.com, 2016).

What are Metrics?

A metric is a standard of measurement by which efficiency, performance, progress, or quality of a plan, process, or product can be assessed (Business Dictionary, 2016). In the hotel world there are numerous examples of data and or metrics that lodging operators use or can use to make decisions on a daily basis. Most hotels use performance indices such as occupancy, average daily rate, revenues per occupied room, revenues per available room (REVPAR), and segment share, such as mix of demand for commercial, group and tourist or leisure businesses. STR, the industry leading source of lodging metrics provides operators across the country with metrics to assist in decision making. The STR Share Center (STR, 2016) provides hotel managers and operators with performance data, (occupancy and ADR), profit and loss data (accounting), pipeline data (under construction), census data (hotel attributes) forecast information property and room counts, sales transaction data, hotel company statistics, and industry reference information (Share Center, 2016).

Hotel operators use these data to make the best decisions they can for their businesses. If we specifically focus on human resources, what are the metrics and measures one would want to use to assess if a hotelís or hospitality businessís human resource practices are efficient? As we know not all hotels are the same or even similar in size and service hotels might make different selections and decisions for which metrics they want to measure and use. HR metrics are a vital way to quantify the cost and the impact of employee programs and HR processes measure the success (or failure) of HR initiatives. A metric is an accountability tool that enables the assessment of a functionís results (Dulebohn & Johnson, 2013). Metrics enable a company to track year-to year-trends and changes in these critical variables (Wikipedia, 2016).

The task, as a hotel human resources manager is to assemble the metrics needed for your property. These metrics will enable HR personnel to communicate with hotel decision makers in a fashion somewhat similar to the hotel metrics discussed above. The question is, what are the metrics for each HR function? In that effort, the following is a brief outline of a sample of HR topics and functions:

Typical Human Resource Functions:

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Coming up in March 2018...

Human Resources: Value Creation

Businesses must evolve to stay competitive and this is also true of employment positions within those organizations. In the hotel industry, for example, the role that HR professionals perform continues to broaden and expand. Today, they are generally responsible for five key areas - government compliance; payroll and benefits; employee acquisition and retention; training and development; and organizational structure and culture. In this enlarged capacity, HR professionals are no longer seen as part of an administrative cost center, but rather as a member of the leadership team that creates strategic value within their organization. HR professionals help to define company policies and plans; enact and enforce systems of accountability; and utilize definable metrics to measure and justify outcomes. Of course, there are always new issues for HR professionals to address. Though seemingly safe for the moment, will the Affordable Care Act ultimately be repealed and replaced and, if so, what will the ramifications be? There are issues pertaining to Millennials in the workforce and women in leadership roles, as well as determining the appropriate use of social media within the organization. There are new onboarding processes and e-learning training platforms to evaluate, in addition to keeping abreast of political issues like the minimum wage hike movement, or the re-evaluation of overtime rules. Finally, there are genuine immigration and deportation issues that affect HR professionals, especially if they are located in Dreamer Cities, or employ a workforce that could be adversely impacted by federal government policies. The March Hotel Business Review will take a look at some of the issues, strategies and techniques that HR professionals are employing to create and sustain value in their organization.