SAINT LOUIS UNIVERSITY

SCHOOL OF ACCOUNTANCY AND BUSINESS MANAGEMENT

GRADUATE PROGRAM

A Critical Review of the Human Resource

Practices of

InterContinental Hotels Group, Inc.

(SC Reservations Philippines, Inc.)
Human Resource Management
Class Code: 0137D
Course No.: ADM 223
Schedule: Thursdays, 5:30 – 8:30
Room: S522
Professor: Dr. Felerina B. Ellamil

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 DESCRIPTION OF THE COMPANY OR ORGANIZATION BEING STUDIED

IHG is a global hotel company whose goal is to create Great Hotels that Guests
Love.

They have more guest rooms than any other hotel company in the world – that's
more than 658,000 rooms in over 4,480 hotels in nearly 100 countries and territories
around the world.

They operate seven hotel brands – InterContinental, Crowne Plaza, Hotel Indigo,
Holiday Inn, Holiday Inn Express, Staybridge Suites and Candlewood Suites.

IHG’s goal

They want to grow by making their brands the first choice for guests and hotel
owners.

IHG’s strategy

Their strategy is to build the hotel industry’s strongest operating system focused on
the biggest markets and segments where scale really counts.

IHG’s operating system

IHG's operating system is made up of all the things they do to drive demand for
their brands. This includes their advertising and marketing campaigns, their 11 global call
centres, 11 local language websites, their global sales team of more than 17,600
professionals, Priority Club Rewards – the world's largest hotel loyalty scheme with over 63
million members – and all the advantages that IHG's global hotel distribution and scale
brings to brand awareness.

They focus on the biggest markets where their scale really counts and they ensure
that they concentrate their resources on the opportunities that will provide them the
greatest return.

IHG’s strategic priorities

 Improving the performance of their brands

 Using their insight to make their brands the first choice for guests
 Delivering consistent customer experiences
 Generating excellent returns from their hotels
 Improving hotel revenue by encouraging guest visits
 Improving the efficiency of their hotels and operating processes
 Putting their market scale and knowledge to good use
 Using their worldwide scale and experience to convert more hotels to their brands
 Making the most of their global presence – guests choose brands they know when
they travel
 Strengthening their organization
 Investing in their people and their ability to do business

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 Building strong partnerships within their own company and with their owners
across the world

IHG’s business model

 They operate hotels in three different ways – as a franchisor, a manager and on an

owned and leased basis.

 Their business model focuses on managing and franchising hotels, whilst their
business partners own the bricks and mortar.

Franchising
This is the largest part of their business: 3,832 hotels operate under franchise
agreements.

Managing
They manage 637 hotels worldwide.

Owning
They own 11 hotels worldwide (less than 1% of their portfolio).

HUMAN RESOURCE SYSTEM

 IHG believes that giving its employees a competitive compensation and benefits
program is vital to ensure that they retain the very best talent.

 Its compensation programs are intended to attract, retain and motivate its
employees by:

> providing further personal financial security and stability

>giving financial assistance for disability or death

>promoting physical, mental and emotional well-being

 Compensation and Benefits components

o Daily Rate
o Holiday pay
o Overtime
o Night Shift Differential
o 13th Month Pay
o Fixed Allowance
o Benefits Package
o Life and Accident Insurance Coverage
o Statutory benefits
o Retirement

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 STRENGTHS OF THE HUMAN RESOURCE SYSTEM

The human resource system at InterContinental Hotels Group is very dynamic and
open in such a way that it is easy for the company to blend in the current trends that it
would be facing and it would be easier for it to implement changes minor or major in the
way it handle its people. The company is built on very strong and well-branded principles
which all employees are abiding by and live by even outside work, the day-to-day operations
revolve around such making IHG a choice employer and Forbes’ best employer’s to work
with. One principle that the company points out very much and has branded enough that it
is ingrained in each employee’s psyche would be the “Room to be Yourself” which is part of
IHG’s “Winning Ways”. Basically, this is to foster employee commitment and a means for
the company to keep and develop the best people in the business and to make their
employees enjoy their time at work. The company encourages its employees to let out their
individuality, talents and capabilities even in the work setting through various activities
and programs that could help them showcase and enhance such. It means that the company
is also a place where its people can bring the same amount of energy, enthusiasm and
dedication to their jobs as they do to their hobbies.

The human resource personnel of the company also makes sure that the employees
feel valued and loved by the company by regularly giving out perks and services like a treat
to a breakfast buffet at a newly opened hotel, free cupcakes, free merchandise from the
company and important services for employee well-being like a shuttle service to eliminate
transportation costs in going to the office, free vitamins and medicines for employee health
and safety and many others. Every time the company gains a good amount of profit for a
certain time period, they make it a point to give back to their employees and the human
resource and accounting departments are in charge of making sure that the allocations for
these things are maximized and manned properly.

The hiring process in the company is also not as frequent as other employers since
employee retention is high, employees stay in the company for a year at least unlike other
off-shored or outsourced companies where employee turnover is very high which is why
every time there is a need for hiring, the human resource department chooses the cream of
the crop to fill in missing positions and makes sure that the new hires are equipped with
everything they need from the onset and is welcomed properly by the company and the
people in it, making them feel at home and at ease. This is enshrined in the promise of the
company to provide the employees a “room to have a great start”. Since employees spend
most of their time at work, there are human resource systems that ensure their
involvement such as those surveys and communities found in the local intranet to make
their voices be heard, this is also to deliver IHG’s promise to its employees to have a “room
to be involved”. By creating an atmosphere of democracy and involvement, the HR could
foster and cultivate employee talent and develop them as assets for the company and
industry.

WEAKNESSES OF THE HUMAN RESOURCE SYSTEM

Upon observation, the training program of the company is not as comprehensive as

compared with other BPOs, it is somehow lax and lacks standardization and a good base.
There is no definite time frame and when employees are trained, it is assumed that they

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are already equipped with adequate amounts of abilities to do the job and experience hence
the difficulty to get in and the high standards potential hires would need to hurdle.
However, it is wrong to assume that employees already have possession of the necessary
capabilities because they are not the same magnitudes and kind, there should be
harmonization and uniformity as to the skills set that the company would ingrain in their
employee through training. There should be an allotted and studied time frame and
methodology that would enforce these things to the people of the company.

As to the orientation part, the company relies on the materials that they give their
employees and fail to look into the smaller and other minute yet critical provisions that the
employees may find important in their tenure in the company. Just like the training, the
orientation should be based on strict guidelines of implementation to avoid leeway for
mistakes and to ensure minimal room for error and misunderstanding between the
employee and the management. Even small details should be explained in depth to have a
common understanding of the rules which bind the company and the employee.

RECOMMENDATIONS ON HOW THE COMPANY OR ORGANIZATION COULD

IMPROVE ON THEIR PRESENT SYSTEM [WITH THEORETICAL RESEARCHES
ON CURRENT THEORY AND/OR [RACTICES IN HUMAN RESOURCE
MANAGEMENT TO SUPPORT FINDINGS AND RECOMMENDATIONS]

Compensations and benefits provided in the career development program must be

made known before engagement of employment and made applicable during the
regularization of the employees. The qualifications of benefit programs must be clearly
stated and must provide for optional alternative programs in case they failed to qualify.
Employees may waive this benefits voluntarily in writing but may opt for other alternative
programs or its equivalence. Employees will be given the right to participate in the policy
and decision making affecting the benefit programs by accommodating feedbacks and
solutions to strengthen these benefit programs.

It would be important for the company to give an in-depth training to ensure the
quality delivery of the job from all employees and to enforce a common understanding of
technicalities and rules within which an employee operates. The same is true for the
orientation. Guidelines and time frames should be implemented to ensure that trainers and
their trainees would be at a common ground during and after the training and that they
would be equipped with the same set of skills and produce insurmountable quality after the
training. Adhering to a time frame and other standards would reduce slack time and
maximize the time being consumed for such endeavors.

SALIENT POINTS OF THE COMPANY OR ORGANIZATION’S CULTURE IN

RELATION TO THE RECOMMENDATIONS MADE

The call center industry is infamously known for the notoriety attached to its
industry such as promiscuity, shallowness of the employees, misguided decisions and too
much liberalism in its actions. The company however sets itself apart from this as there is a
winning and intelligent air among employees which is said to emanate from the very hard
entry to a line position and brought about by strict policies on behavior, dress code and

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others that most BPOs do not even care to look into. Most decisions made in the company
are ruefully based on its principles unlike other companies who makes decisions out of
whim, indeed has IHG branded and stamped its winning ways in its employees psyche in
and out of work. There is a culture of family, intellect, competence and achievement that
can be seen in each and every individual in the company and the grapevine is used for
productive purposes and not for useless gossip and politicking. Professionalism is very
important in living up to the expectations of fellow employees and a highly ethical
expectation

PROPOSALS TO MAKE THE HUMAN RESOURCE SYSTEM MORE SUCCESSFUL

AND CRITICAL PLAYERS (PEOPLE) WHO WOULD FACILITATE THE
SUCCESSFUL IMPLEMENTATION OF RECOMMENDATIONS

InterContinental Hotels group strategy is to be the first choice for people to go

for employment. They believed that giving their people a competitive compensation
and benefits program is vital in ensuring that they retain the very best talent.
IHG’s compensation programs are intended to attract, retain and motivate their
employees by:

 Providing further personal financial security and stability

 Promoting physical, mental and emotional well being

 Creating a standardized training manual and methodology with a

definite time frame

Compensation and benefits program of any organization plays a vital role in

the accomplishment of the company’s goal or objectives. It is very important for any
organization to develop this HR system in order to recruit and retain the very best
talent that they will need.

In order for the company to make this HRM system be more successful is to
ensure the following:

1. The company must communicate the compensation and benefits

program that they offer in order for all employees to fully understand what they will
obtain. This will ensure that employee’s satisfaction and performance are affected
in the best way for the company.

2. The company must set objectives and strategy for benefits. They must
be the first to offer the newest benefits that employee’s desire and match a better
benefits program that similar organizations offer. Furthermore, they must involved
their employees in coming up with new benefits program to implement. This will
ensure that the program is the desire of every employee.

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 3. The company must ensure that the compensation and benefits
programs are administered correctly.

The critical players who could facilitate the implementation of these

recommendations are the management specifically the HR Department and the
employees. Management must ensure the proper implementation of compensation
and benefits program of the company that every employee understands and desires.
All employees must also take part in the coming up with new benefits program and
to compensate with dedication to work the benefits that the company provides.