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By: Thomas Mielke | Georgianne Fsadni | Andrew Hazelton

At the beginning of the year, AETHOS conducted an industry-wide survey, intending to shed light on the alignment between the HR function and senior leadership (click here to review the findings). Sixty-eight (68) senior corporate HR professionals, working predominantly in the hotel and restaurant industry in Europe, Asia and North America, participated. Sharing their views on performance-level expectations set by their respective company’s senior leadership teams, they rated the adequateness of resources and support provided. The survey concluded that there was a substantial misalignment between departmental success metrics and allocated resources required to achieve such metrics. The findings indicated that poor support in any one specific HR function could potentially start a negative ‘domino effect,’ threatening the HR department’s strategic value-add to any organization.

To understand how to potentially avoid this dreaded ‘domino effect,’ and to obtain a more balanced picture, AETHOS invited senior leadership teams to share their own views on this subject. A total of 88 executives responded (88.6% men, 11.4% women, working with major hotel [87.5%], restaurant [6.8%], casino-gaming [3.4%], and travel-tourism companies [2.4%]) from the Americas (29.9%), EMEA (51.7%) and Asia-Pacific (18.4%). Participants were asked the same questions as the surveyed HR executives and they provided candid feedback on alignment, resource allocation and performance expectations. Here are the observations:

Talking ‘priorities’ and adequateness of ‘resources’

Company leadership agrees with the findings of the previous study in that administrative aspects of the job should not take up the majority of the HR agenda. In fact, on average, senior executives believe that only a third (32%) of HR’s time should be spent handling administrative aspects, fixing problems and/or maintaining the status quo. Strategic aspects, on the other hand, such as succession planning, proactive and solution-orientated thinking and ‘innovation’, should take up, on average, approximately 49% of HR’s time.

However, opinions are divided when it comes to how well HR is resourced to deliver on its targets. For example, leadership believes staffing and funding are much less of an issue than they actually are:

  1. In terms of staffing, 80.9% of leadership believes HR is appropriately staffed, a stark contrast to what HR executives felt (only 70.9% of HR executives agreed).
     
  2. In terms of funding, 82.5% of leadership believed HR has enough monetary resources (only 72.7% of HR executives agreed).
     

In contrast, leadership is worried about HR not receiving enough peer support or that unrealistic deadlines are pressuring HR when, in fact, HR is not too concerned about those aspects:

  • In terms of peer support, 82.5% of leadership thought that HR is ‘backed-up’ by their counterparts in other departments (versus 89.1% of HR executives).
     
  • In terms of time pressure, 71.4% of leadership believed that HR has sufficient time to achieve their key performance indicators (KPIs) (versus 98.2% of HR executives).
     

Identifying the disconnects

The leadership survey reveals that senior management is not aware of the true pressure points HR is facing in its daily struggle to achieve set targets. The above-mentioned contrasting views on the adequateness of resources are just one example. Analysing the results of both the HR and the leadership questionnaires exposes further misalignment between senior management and HR.

For example, the earlier HR survey revealed that leadership seemingly sets goals that cannot be fulfilled given HR’s lack of resources. Consequently, the daily realities of the HR department mean that other tasks require more urgent attention (causing the ‘domino effect’). Yet, juxtaposing the responses from senior management and HR professionals paints an even more complex picture – ultimately telling us that one hand might not necessarily know what the other hand is doing. The table below highlights those contrasting views and opinions. It shows that there is a clear disconnect between what HR executives think they are expected to do and what they are actually capable of doing with the resources available. It also indicates that there is misalignment regarding what HR executives think they are expected to do and what leadership actually asks HR executives to do. Lastly, it highlights that there is a discrepancy between what HR executives actually manage to do and what leadership thinks HR manages to get done.

Recognising the true culprit: Communication, or lack thereof

The HR survey hinted at the fact that ‘communication’ might be at the heart of the problem. The leadership survey now seems to have confirmed this, and there has been no better way to corroborate this than by asking a set of straightforward questions:

  • Is HR well equipped and resourced to achieve its KPIs?’ 53.9% of senior management believes (despite stating that it is aware of the lack of resources) that HR does not have to ‘fight’ internal battles to secure necessary resources, but 67% of HR executives actually feel that they do.
     
  • Is the HR function vital to your firm’s success?’ 98.7% of leadership agrees or strongly agrees that the HR department indeed plays a key role in ensuring success; yet, HR executives thought this number to be lower (93%).
     
  • Is HR’s voice being heard at the board table?’ 87.7% of senior management agrees or strongly agrees when asked if they sufficiently hear about HR’s opinions and views on business matters. Remarkably, when HR executives were asked, this number was significantly higher (94%).
     

The findings are telling. They indicate that leadership actually would be happy to provide more resources but that HR is not sufficiently speaking up and making its case (or perhaps, leadership is just not hearing HR’s cry for help). The results also pinpoint an age-old problem: leadership needs to make sure to not only commit to and communicate its support of the HR function but also to act upon it. After all, actions speak louder than words. The findings are also telling us that HR could do a better job in communicating and expressing its own thoughts and concerns. Leadership is certainly open to hearing more from HR professionals and valuing its opinion, but it also believes that HR needs to be more point blank in articulating its needs.

The way forward

The greatest return on investment lies in bridging the gap between performance expectations and the daily realities of the job. The very best way to ensure this is happening is by aligning leadership and the HR department. The plan of attack? Back to the basics. Candid and open communication is the best way forward. If leadership is truly welcoming HR to have a seat at the board table, HR executives must step up and secure their place. Leadership must proactively encourage HR to speak up and seek input, and HR must clearly communicate what is needed to be successful (‘if you don’t ask, you don’t get’).

About Thomas Mielke

As a founding partner of AETHOS Consulting Group, Thomas has a track record in successfully placing senior executives at leading hospitality companies across the EMEA region. He is an AESC certified consultant and is working together with travel wholesalers, real estate development firms, investment companies and sovereign wealth funds as well as leading restaurant brands in identifying key talent and has joined forces with clients in establishing compensation schemes as well as organisational structures and workflows.

Contact: Thomas Mielke

tmielke@aethoscg.com / +44 (20) 7065-1392

About Georgianne Fsadni

Georgianne Fsadni (Georgi) is the Managing Director for Asia Pacific region for AETHOS Consulting Group, based in Melbourne, Australia. AETHOS is the leading global hospitality-focused executive search and human capital advisory firm. With more than 30 years of experience in various aspects of the lodging and hospitality industries, Georgi facilitates senior executive search, compensation and performance management advisory as well as asset management and investment advisory in the region.  AETHOS Consulting Group is a proud Silver Sponsor of HotelsWorld, encompassing five events to be held in Sydney, Australia July 26-28, 2016, and the co-host of “next, A Future Leaders Summit” a symposium comprised of rising stars in the hospitality industry as a part of HotelsWorld.

Contact: Georgianne Fsadni

gfsadni@aethoscg.com / + 61 (4) 01 513 342

About Andrew Hazelton

Andrew Hazelton is Managing Director at AETHOS Consulting Group. An experienced recruitment consultant, he has over a decade of retained executive search experience in a variety of industries, including hotel, restaurant, gaming, real estate, finance, and technology. Prior to joining AETHOS Consulting Group Andrew was with HVS Executive Search and spent six years with Korn/Ferry International. Throughout his career he has been responsible for completing a number of C-suite searches globally. He has authored a number of articles on executive selection, general HR trends and compensation for the hospitality industry. Andrew is a graduate of The Pennsylvania State University, an active alumni member, and a member of the Penn State Hotel and Restaurant Society.

Contact: Andrew Hazelton

ahazelton@aethoscg.com / +1 (267) 462 4455

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