Saturday, 13 December 2014

Cresta Hotel Group marketing, HR and financial analysis


Human Resources Management

This is the science of allocating human resources among assorted undertakings or company Constituents, maximizing the utilization of effective man power to accomplish company goals; and giving the interest that are vital in the maintenance of that workforce across identification of staffing necessities, arranging and oversight of payroll and benefits, education and expert progress, and administering their professional needs Cheung. C, Kong. H, and Song, H., (2014). Young-Thelin, L., and Boluk, K., (2012) cited by Scholarios, C (2004) argues that the effective and competent placement of an organization's human resources in the area of demand, and in ownership of the instruments, training and skills needed to accomplish the task and Following improvements can help to manage Cresta Hotel Group HRM issues.

Recruitment and selection

Forms the foundation of the core activities and processes underlying human resource management and such activities include the acquisition, training and development, and rewarding performance of workers (Scholarios, C., 2004). A scope of assessments in the selection process ought to be utilized to assess the work benefits, personality, interpersonal skills and problem-solving skills of possible employees to assess their ‘service orientation’ (Pride. W et al 2012). However the Cresta hotel group identify human capital as key component, they value its employees and endeavour to recruit and retain the best skills in market. The success and sustainability of most organizations is directly proportional to skills and competencies of the employees. Meanwhile Cresta Group are doing similar as Hilton As one of the largest management companies in the industry, they have over 665 managed properties and 100,000 team members to maintain. Their (Cresta) main focus is on recruiting and retaining the industry's finest team members. In Human Resources & Training, they believe people are the key to providing an outstanding hospitality experience.

Training and development:

All organisations today face rapid and often unexpected change. Giving employees the knowledge, skills and attitudes to cope with change is not just good people management; it is a prerequisite to survival and success, both personal and business. This is the vital role of training in modern organisations. No longer is training the preserve of specialists. It is an organisational responsibility, shared by all those with an interest in making the most of the human resource (Young-Thelin, L. and Boluk, K., 2012). However the focus for developing human capital is based on training continues reviews of compensations and benefits. It is through these standards that have earned Cresta Hotel Group the reputation for consistency (Cresta Hotel Group, 2011).

Staff welfare and Development

All organisations today face rapid and often unexpected change (Pride. W et al 2012). Giving employees the knowledge, skills and attitudes to cope with change is not just good people management; it is a prerequisite to survival and success, both personal and business (Karatepe, 2011). In the quest of the Cresta group’s drive to improve productivity for the employees, sports was identified as one of the elements that’s play an important participating across the hotels, the group has various sporting codes being played, soccer, volleyball, netball, etc. The interaction between these groups is believed to impact positively on employee’s motivation. This evidence group adherence to Werner’s quotes which states that “One of the big issues human resources managers will have to think about in the future is whether health care is or is not a natural right of every employee”. The group also practice the same philosophy by Marriot Group of building employee loyalty, pride, team spirit and morale of which begins by meeting needs as basic as health care. Marriot founder William Marriot said it best. “Take good care of your employee and they will take good care of the customers”.

Employee engagement

By pursuing larger involvement from employees the emphasis is on presenting autonomy, creativity, cooperation and self-control in work processes. The use of educative and participative mechanisms, such as team briefings and quality circles are associated to adjustments in the organization of work that prop an ‘empowered’ environment.

Employee engagement is not a Human Resources initiative that managers are reminded to do once a year. It's a key strategic initiative that drives employee performance, accomplishment, and continuous improvement all year long (González, S., (2004). General employee engagement at various levels of the organisation has yielded positive results for Cresta group. This has led to an improved customer focus. Good managers develop employees for tomorrow's opportunities by encouraging them to work toward their full potential today, argues Galang (1999). Communicating with employees is essential to showing your people that you are sincerely interested in them as individuals (Marriot, J., 1987). The same author continues to say communication also means listening to them if they have a problem with their job or management. Managers need to frequently get their people together and ask them "How are we doing?" and "What can we do to improve?" For the communications process to work effectively, it's important to listen to and act upon the answers to those questions.






CORPORATE SOCIAL RESPONSIBITY


The Cresta corporate social responsibility programme concentrate on assisting the communities in which the group operates through donations of various items. The group in its active involvement aid social development and the protection of quality of life. The group believes that goodwill and being good hearted may not be a core function in the business but is central to their social license to do business. That is how the group would donate various items including cash and charity.


What is it that Cresta is doing to encourage corporate social responsibility

DONATIONS DONE BY CRESTA BETWEEN 2013 AND 2014

Sir Seretse   Khama   memorial fund for people living with disabilities
                                                                                                                                         
RECEPIENT
ITEM
VALUE
Sir Seretse Khama memorial fund for people living with disabilities
Cash
P65.000
Destitute in kalamare
House
P100.000
Dukwi Refugee Camp
Clothing and bedding
SP30.000
Lady Khama Charitable organization
Cash
P20.000
Women shelter
Linen
P25.000

 CUSTOMER RELATIONSHIP MANAGEMENT
According to Cresta Marakanelo Group Chairperson Ms Maria Nthebolang emphasized that as a group thy have intended to hire skilled personnel so that they would provide high levels of customer service to their valued customers. Adding on what she said Mr Makaya also commented that as a group they offer affordable services to their customers and all the services are delivered accordingly since they have trained staff.
Cresta acknowledge the importance of having skilled motivated and satisfied workforce as their staffs are the people who interact with customers. The Cresta Marakanelo Group has continued to benchmark itself against the leading brands and the standards required to be customer focused, quality conscious, innovative and being responsible for its actions.
What is customer relationship management and what is Cresta focusing on in terms of CRM?
According to Fickel (1999) CRM is a combination of people, processes and technology that seeks to understand a company’s customers. It is an integrated approach to managing relationships by focusing on customer retention and relationship management
At Cresta Customer relationship management is practised focusing on the following.
PRICING
Hotel tariffs are regularly published in the hotel for the customers to see. There are different discounts levels for their customers. Customers get different discount levels after a careful assessment of their customers and the business they bring to the entity. The group has a loyalty programme where cardholders get various discounts depending on the product they want.


CUSTOMER INFORMATION SHARING
Group has various means of sharing information with its stakeholders. One of the mediums is through the frequently update website where new developments or new products will feature. Further the group has got an in-house magazine called Cresta Calling where information is relayed to the stakeholders.
FINANCE
Risk management is the identification, analysis, assessment, control and avoidance, minimization of unacceptable risk.  They are three levels of risk management such as; operational risk-that we face day to day in the operation of hotels. Project risk when we start building a new hotel and choosing when we are going to expand and strategic risk that has to do with decisions about risk the company faces when it pursues its strategic objectives (Nand 2011).
Chairperson of Cresta group’s statement on annual report of 2013 stated that the group has defined its model and approach to run its business more competently.
The Cresta Group’s (2013) total risk management progamme focuses on the instability of financial markets and seeks to minimize potential effects on the Cresta Group’s financial performance. Senior management carry risk management under approved policies by board of directors and it provides written principles for overall risk management. Explain process of risk management?
The Cresta group of hotels board (2011) provides written principles for overall financial risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, and investment of excess liquidity.
“Financial risk management has received increased attention over the past years, the   reason   for this   is   that   financial   risks,   though   they   are   not   a   core competency   of   non-financial   firms,   also   influence   their   business   operations   to   a   large extend (Triantis;   2000).” 


Financial   risks   can   be   of   different   forms.   There are external financial risks depending on changes on financial markets and internal financial risks, where the business itself is the cause of the risks (Eichhorn, 2004).Explain types of risks found in Cresta group of hotels?


  • Exchange rate risk -they happen when a business is involved in international business and the cash in or outflows are in a foreign exchange rate. As this rate is not fixed and cannot be fully   estimated   a   likely   change   in   a   foreign   exchange   rate   leads   to   the   risk   of changes in the amount of a to be paid / receivable and by that a vary in the sum of money the business has to pay / will receive. This risk is measured by the concept of transaction exposure (Armeanu and Bãlu, 2007).
  • Interest rate risk –It is based on changes in interest rates and can be pragmatic in different forms. The first form refers to changes in interest rates in association with unpredictable loans and short-term financing. A rise in the interest rate leads to higher interest payments for the   variable   rate   loan   and   more pricey   follow-up   financing.   This   decreases   the company’s   income   and   can in   worst   case   it   is   lead   to   financial   distress.   Second,   the vice versa case refers to cash positions of the company with a variable interest rate. A fall in this rate leads to a loss in earnings.
  • Cash flow and fair value interest rate risk –According to Cresta group of hotels (2013) “interest rate risk starts from long-term borrowings, short-term bank deposits and bank     overdrafts. Bank overdrafts are obtained at, and short-term deposits are placed at, variable rates that    expose the group to cash flow interest rate risk. During the financial year, the group’s borrowings and   deposits at variable rates were denominated in Botswana Pula.   The group analyses its interest rate exposure on a dynamic basis”. Different scenarios are replicated   taking into concern refinancing, regeneration of on hand positions, and alternative financing. Based  on these scenarios, the group calculates the impact on profit and loss of a defined interest rate


                                            INTERNAL CONTROL 


Internal    control   is generally    defined    as a method, affected    by   an entity’s   board   of   directors, management and   other   personnel, intended to offer sensible guarantee     concerning the success of objective. How internal control can help Cresta group of hotels
Reference



Cheung, C., Kong, H. and Haiyan Song, H. (2014) How to influence hospitality employee perceptions on hotel brand performance? International Journal of Contemporary Hospitality Management vol. 26: 8, 1162-1178. [Available at] www…….[accessed on 29 November 2014]

 

Ellen Wu, H. (2004),"Human Resources Issues Facing the Hotel and Travel Industry in China", International Journal of Contemporary Hospitality Management, Vol. 16 Iss 7 pp. 424 - 428

Available at: http://dx.doi.org/10.1108/09596110410559122 [Accessed on: 25 November 2014]

 

Galang, M. (1999) Employee Reactions to Voice and Choice in the Workplace: The Influence of Culture, International Journal of Human Resource Management, 10(4), 703-715 Available at……… [Accessed on 29 November 2014]

 

González, S (2004),"Improving Human Resources Management: Some Practical Questions and Answers", International Journal of Contemporary Hospitality Management, Vol. 16 Iss 1 pp. 5: Available at http://dx.doi.org/10.1108/09596110410516570 [accessed on: 25 November 2014]

 

Grau-Gumbau, R. R., Agut-Nieto, S. S., Llorens-Gumbau, S. S., and Martínez-Martínez, I. M. (2002) Managerial Training Needs; A Study of Spanish Tourism Organisations. Tourism and Hospitality Research, 3(3), 234-244.available at:……… [Accessed on 25 November 2014]

Karatepe, O. M. (2011) 'Procedural Justice, Work Engagement, and Job Outcomes: Evidence from Nigeria', Journal Of Hospitality Marketing & Management 20(8), 855- 878, Available at:………………… [Accessed on 29 November 2014]

 

Namasivayam, K., Guchait, P. and Lei, P. (2014) The Influence Of Leader Empowering Behaviors And Employee Psychological Empowerment On Customer Satisfaction, International Journal Of Contemporary Hospitality Management, 26(1), 69-84 Available at:…….. [Accessed on 25 November 2014]

 

Po-Hsuan, W., Ching-Yuan, H. and Cheng-Kai, C. (2014) Service Expectation, Perceived Service Quality, and Customer Satisfaction in Food and Beverage Industry, International Journal of Organizational Innovation [online], 7(1), 171-180, Available at………… [Accessed on December 3 2014]

 

Pride, W., Hughes. R and Kapoor, J. (2012) Introduction to Business (11th ed). Canada: South Western.

Scholarios, C., (2004),"Selecting Hotel Staff: Why Best Practice Does Not Always Work", International Journal of Contemporary Hospitality Management, Vol. 16 Iss 2 pp. 125 – 135: available at http://dx.doi.org/10.1108/09596110410520016 [accessed on 25 November 2014]

 

Young-Thelin, L. and  Boluk, K. (2012) A Case Study of Human Resource Practices in Small Hotels in Sweden. Journal of Human Resources in Hospitality & Tourism 11:4, 327-353. Available at: www….. [accessed on 29 November 2014]

 

 

Werner,William, 417–419, 421, 424,

426, 428

 

 
Zheng, G., and Siu, R. (2009) Drivers Of Job Satisfaction As Related To Work Performance In Macao Casino Hotels. International Journal Of Contemporary Hospitality Management, 21(5), 561-578.Available at:……[




 

5 comments:

  1. Moreover employee engagement is typically measured using an employee engagement survey that has been developed specifically for this purpose. Employee engagement surveys must be statistically validated and benchmarked against other organizations if they are going to provide useful results. Without these things, it is difficult to know what you are measuring and whether the results are good or bad (González, S 2004).

    Corporate social responsibility is the balanced integration of social and environmental considerations into the business decisions and operations (Merrett and Hill 2005). Corporate Social Responsibility has emerged as a way for enterprises to consider the impact of their operations on society and affirm certain principles and values within their own internal processes and interactions with external stakeholders. According to Mallan (2004) corporate social responsibility is all about how a company is managing its business in order to produce an overall positive image which has a positive impact on the society.

    The group, s corporate social responsibility progamme is focusing on the following support for the disadvantaged and or handicapped, skills development, education, public health that need assistance, nongovernmental organization these must be focused on improving the general welfare of Batswana in some form, needy communities whose projects are intended to improve the lives of Batswana. The Cresta group has donated P200-000 to Masiela Trust Fund for the needy children in 2011.The group have also donated the bed linen to Kasane Hospitality still in the year 2011.

    CRM is a phrase that describes how your business interacts with your customers. It can also be seen as a system that capture information about your customers and what you do with that information to better meet the needs of your existing customers, how to identify new one which will result in higher profit.(Goldberg 2000) One of the elements that the Cresta group is focusing on is

    CUSTOMER COMPLAINTS
    These are normally received at every hotel and the ultimate responsibility to resolve these lies with the General Managers of each hotel. There is an escalation that could be done in the event of the customer not satisfied with the complaint resolution.

    level a firm desires, identifying the risk level it currently has and using derivative or other financial instruments to adjust the actual risk level to the desired risk level.’ The different tasks of risk management are prearranged in a procedure of sequential phases. Although many researchers explain the phases likewise, the meaning to be found in the literature differs in the way the tasks are structured into the phases. Firstly a company requirement’ is to understand the sources of risk it is exposed to, to be able to manage it. (Triantis: 2000).

    PROCESS OF RISK MANAGEMENT
     Risk management process begins with risk identification- The aim of this phase to discover all risks, which could disrupt the business improvement. The risks that should be recognized can either have a negative impact on the balance sheet, the financial statement or the cash flow situation of the company and therefore on its improvement .This stage is very useful as only identified risks can be handled successfully in the next steps of risk management ( Stroeder ;2008) .

     Spear etal (1994) states that ‘’Senior executives have long sought ways to better control the enterprises they run. Internal controls are put in place to keep the company on course toward profitability goals and achievement of its mission, and to minimize surprises along the way.’’ They allow executive to deal with rapidly shifting economic and competitive environments, changing client demands and priorities, and restructure for upcoming growth. Internal controls support efficiency, reduce risk of asset loss, and help ensure the reliability of financial statements and compliance with laws and regulations.

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  2. Your people also need to understand why details are important and to see the connection between what they do and the end products: the customer satisfaction that produces the sales which support the business and its employees. The clearer and more consistent our concern, the more motivated and knowledgeable your employees will be to do things right of which is not indicated in the Cresta Hotel Annual Report. Galang (1999) and Namasivayam et. al (2014), in their research, found that employees who are empowered feel better about themselves and with their jobs, which perhaps may improve their job performance and customer satisfaction

    According to Thornton (2008) a well-developed performance and talent management strategy with embedded corporate social responsibility components can reduce the likelihood and impact of losing employees. CSR can also be about delivering sustainable value and long term benefits to all stakeholders.
    Cresta Marakanelo Ltd has a robust corporate social responsibility programme which is in line with some of the eight United Nations millennium development goals. Cresta has adopted the following CSR policies to conduct their business in a socially responsible manner protecting the environment and natural resources, Committed to supporting human rights by working with various governmental organizations and non government organizations. The company pledges to engage, learn, respect, and support the communities cultures within which the company operates. The company’s initiative in this regard included donations of cash and non cash assets to the registered charitable organization whose mission, values and strategies are well defined and implemented.
    Cresta Marakanelo ltd involvement in the local community includes The Masiela Trust fund which the company has supported through donations since its inception in 2001.
    The SOS in Francistown whose annual SOS Christmas party is hosted by the Cresta Marakanelo Ltd.
    Cresta has also provided SOS villages in Serowe and Tlokweng with beds and linen.

     Last and final step of the process is the risk monitoring which becomes part of the daily business until the process is started again from the commencement. At the last stage of the risk management process it should be checked with a risk monitoring whether the risk identification, evaluation and assessment have been doing well (Hermann; 1996). This stage is essential for taking suitable procedures in time in case deviations between the real and planned risk situation are known (Triantis;2000). The monitoring stage should then include developments of the risk positions and procedures to control them. Moreover the overall risk situation of the company should be compared to the plan and the risk strategy and deviations should be documented (Liekweg & Weber, 2000). When identifying differences, the risk management process should be started all over again.

     One of the good defenses against business malfunction, as well as an essential driver of company performance, is having a useful internal control system, which manages risk and enables the formation and preservation of charge. Booming organizations know how to take advantage of opportunities and oppose threats, in many instances through effective application of controls, and therefore improve their performance. Internal control is an important part of an organization’s supremacy system and capability to manage risk, which is understood, effected, and vigorously monitored by the governing body, management, and other workers to take advantage of the opportunities and to counter the threats to achieving .

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  3. Of course, many researchers have written much of human resource management but still remain a calling to hotel industry. Furthermore they are a need for managers to give us in-depth description on their positive traits for example Marriot stated in their report that training programs programs varied between frontline employees and managerial personnel. Over time, training programs evolved from classroom- based teaching to interactive multimedia training. As another managerial initiative, work-related training, it’s other important feature that drives to the enhancement of job satisfaction and to the ability to meet the needs and expectations of customers (Zheng and Siu, 2009).The same author argued that in most cases where the services are unsatisfactory, it is the consequence of the inability or lack of motivation among front line employees who provide the services. In a way to avoid such unsatisfying cases, managers must put more effort in training their employees, once it is proved that the training improves the competencies and motivation of the employees in meeting the organizational goals (Grau-Gumbau et. al, 2002).
    The Cresta group will practice a responsible attitude towards energy conservation in terms of the reduction and recycling of waste, the control of sewage disposal, air emissions and pollutants, the reduction in use of such unfriendly products such as CFCs, pesticides and other toxic substances and reduction of noise and visual pollution. Cresta believes that CSR should not just be about philanthropy and compliance but that it should also offer a more holistic corporate approach toward economic, social and environmental impacts as whole.

    Peppers and Rogers (1999) define CRM is a comprehensive strategy and process of acquiring, retaining and partnering with selective customers to create a superior value for the company
    and the customers. It is also argued that CRM is not a technology for CRM to succeed in your business, first develop you CRM strategy and then choose the best technology to support. One of the elements that Cresta is looking into under their Customer relationship management is customer information sharing.

     Risk analysis and evaluation - the most excellent ways to knob the recognized risks and how this handling can be incorporated on a daily basis are evaluated. Once the risks are known, they should be analyzed and evaluated. The plan of the risk evaluation is to establish the degree of the identified risks and quantify their financial impact on the company. Once the risks are accurately described, they must be mapped according to the possibility of them taking place and the consequences if they transpire. (Bowdin etal 2012).

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  4.  Risk assessment- According to the risk willingness, procedures to handle the risk will be chosen in the third phase. Those measures range from risk avoidance or prevention, over risk reduction, to shift of risks and finally acceptance of the risk (Wesel; 2010). A simple measure to handle an identified risk position is to decide to avoid the risk ,though the establishment has to admit that avoiding single risks eliminates besides the risk also all activities and chances connected with it (Stroeder;2008).

     Internal control can help Cresta Group of hotels to achieve its performance and productivity targets, and stop loss of resources. It can help guarantee consistent financial reporting. And it can help ensure that the enterprise complies with laws and regulations, avoiding harm to its name and other consequences. All in all, internal control can help an entity get to anywhere it wishes to go, and evade pitfalls and surprises along the way.

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