Employee Engagement: Retaining Talent in the Scottish Hospitality Industry

By Bernadette Scott Senior Lecturer, Business Management, Glasgow School for Business & Society | March 03, 2013

This arcticle was co-authored by Gemma Cannon, General Manager of hospitality and events at The National Piping Centre, Glasgow.

High talent turnover is an unwanted feature in many organizations, with the hospitality industry reporting the worse retention rates in tandem with the retail sector at 30% in the UK and 31% in the US according to the International Hospitality and Tourism Institute (2012). Ubiquitous reasoning like low pay, average age of workforce, seasonality, zero hours contracts and anti-social shift patterns are all well known. However, from a talent management perspective, with particular emphasis on the Generation Y workforce, it becomes more pressing for organizations to understand the needs of younger workers and graduate talent, who are required now to fuel consumption of the hospitality products of the future. UK organizations are reporting that they are employing more young people in the 16-24 age group than they did a year ago (CIPD, 2012), however, Meister (2012) has found that globally, 91% of young workers and graduates (born 1977-1997) stay in jobs for less than three years. This is a frightening situation for an industry which relies on young talent to undertake the demands of the business with the necessary skills, energy and flexibility to ensure continued organizational success.

The National Piping Centre situated in Glasgow city centre is a diverse boutique hotel, employing 50 staff. Set in a grade B listed building; it also serves as a visitor attraction, school, and library with fully functioning restaurant and events co-ordination. The Centre's main ethos may be unique in that it aims to promote the study of the music and history of the great highland bagpipe; However, it faces the same challenges as other operational counterparts and this report is focused on primary findings connecting the areas of talent retention and employee engagement. This was achieved via critical evaluation of current rates of turnover and establishing why employees leave the company. Employee perceptions of existing approaches in place to maintain their engagement and commitment were analyized, alongside questions of existing and potential managerial support. Primarily, to aid achievement of personal best via career development, but also to foster a retention strategy, providing connectivity to commitment to the organization's future strategic goals.

Adoption of a strategic and operationally tailored approach to talent management at corporate level is not a new phenomenon, with recognition of the benefits in terms of competitive advantage widely reported. The Centre takes this strategic approach to its business plan, placing customer and staff interests at the planning core of its operational areas. The talent management strategy evolves from this and aims to embed continuous improvement through employees, empowering delivery of outstanding customer service. However, findings suggest that due to the challenges of the current operating climate, management often become preoccupied with necessity and the maximization of every business opportunity presented. Coupled with an ethos for drive to achieve outstanding results, this can occasionally lead to loss of connectivity between the business plan, and the employee's engagement. One recognized outcome of this situation has been the loss of some talent, who report that their departure has been motivated by lack of career enablers, to aid progression and associated improved remuneration. Case analysis shows that a retention lifecycle of three to four years emerges, as talent exhausts its position and moves on. Feedback from both management and employees indicates that the main focus of the operation has been on managing performance and maximizing human capital, whereas the retention of talent can also call for additional consideration of increased employee succession planning and work life balance considerations. The motivation for this study was to ensure that going forward; the company has a clear vision for employee retention and engagement so that overall performance improves as a result. This strategically reverses the polarity of a performance approach to talent, to a clearer talent management equals performance ideal.

People managers know well that talent leaves an organization for many reasons. Taylor (2010) provided four categories for employee turnover, covering Pull factors, where the leaver has a positive attraction to alternative employment, such as better hours. Push factors, when talent feels it cannot work at the organization any longer, perhaps due to poor management. Unavoidable turnover, when the employee has a personal change, such as an illness and Involuntary turnover due to redundancy or end of contract.

Although analysis of turnover statistics at the Centre showed the usual and expected seasonal trends, it was significant to gain and understand more precisely the reasons why talent chose to move on. Analysis of exit interviews with graduates explained that hospitality talent had stayed with this particular company for much longer than the average length of service in the industry nationally and had departed because they had taken the role as far as it could go. Passion for the company and the industry was evident, but the Generation Y need for development opportunities and career expansion is evident in the findings. Heaton et al, (2008) found that effective mentoring and succession planning were very important to graduates for their future employ-ability.

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