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Chapter 2 Human resources planning.


Ed Evans, Senior Vice President for Human Resources, ARAMARK Uniform Services

"All this will not be finished in the first one hundred days. Nor will it be finished in the first one thousand days, nor in the life of this administration, nor even perhaps in our lifetime on this planet. But let us begin."


"There is nothing more difficult to take in hand, more perilous to conduct, or more uncertain in its success than to take the lead in the introduction of a new order of things."



Planning is a topic that is addressed from many perspectives in hospitality management programs. Nevertheless, the subject of planning and its relationship to human resources management is frequently overlooked. And how can this be? As you will soon learn, it is the planning process that sets the stage for all functions in the human resources arena. It is the purpose of this chapter to assist you, the manager with human resources responsibilities, in integrating the various components of planning and management that you are already familiar with into a logical framework. The sequence of the material in this chapter has been carefully planned to lead you through the stages of planning necessary for effective human resources management. The activities appear in the order you would perform them if you were working in a hospitality operation today.

At the conclusion of this chapter you will be able to:

1. Present a conceptual framework that sequences the stages in the human resources planning process.

2. Define planning within the context of human resources management and the changing environment.

3. Describe why planning is necessary for effective human resources management.

4. Interrelate the various components that make up the human resources planning process.

5. Develop a systematic approach to human resources planning and implementation that can be applied in the hospitality industry.

6. Distinguish between planning, forecasting, and determining objectives.

7. Discuss the role of forecasting in the human resources planning process.

8. Determine operational objectives for human resources management.


Imagine that this is your first day as a manager with human resources responsibilities in the hospitality industry. Perhaps the operation you are in is a fast food restaurant, or a table service restaurant with a high check average. Maybe the operation you are working in is part of the lodging sector of the industry, a property owned and managed by a multinational hotel company, or a single operation owned by your family. The operation you are now a part of might serve 1,000 covers a day or 100, it might have 1,000 rooms or 100 rooms. The size of the operation and scope of services offered are limited only by your imagination.

No matter what the size and scope, you are responsible for the human resource functions of this operation. If your title is manager or director of human resources, your entire job depends upon the people side of the business. If your title is a little more generic, say assistant manager, partner or owner, then your job involves both the production and the people aspects of the business.

Knowing that you are responsible for the people of your hospitality operation, where should you begin? What is the starting place in human resources management? We have already discussed the numerous functions that occur in human resources management. Which one would you pick to begin? What do you do first? If you are like many managers when asked this question you will respond with "hiring." After all, there is very little you can do with respect to orientation, training, development, and compensation until you have hired! Right? Wrong!

If the first thing you do as a manager of human resources is hire, you are just like the production kitchen manager who starts with the designing and construction of the kitchen and then determines the menu. It is not long before the work flow in the kitchen and types of equipment it contains dictate what the production kitchen manager can include on the menu. Courses in production management teach you that the starting place is with the menu. What is a menu? It is a plan that provides guidelines for decision making with respect to work flow and equipment needs (Figure 2-1).


Just as a good production kitchen manager begins with a plan, so should a good manager with responsibilities for the operation's human resources. The way planning is carried out is largely determined by the way an organization is structured. The types of planning required depend heavily on the situation in which that organization finds itself, and on its particular needs. The need for planning, for example, changes and may be affected by the age of the operation. A new operation may call for more flexibility and centralization in planning, whereas a more established operation may be more formally structured and have a tendency to be increasingly decentralized. As the operation evolves, so does planning. Though planning must always be conducted in light of the situation in which it is going to be used, there are many important reasons why you should begin human resources management with planning.

"Even the best run operation experiences
unexpected events (problems) every day,"
states Ed Evans. "Without a well thought out,
well articulated plan--you and the people who
work for you will react rather than respond to
these problems. With a plan some of the work
has already been done, thus you and your
team can focus on the tactics to carry out the
PLAN rather than scrambling to develop one.
If you don't have a plan at the point you
encounter a problem--by the time you come
up with one, it probably will be too late!"

The Importance of Planning

To begin with, planning increases both effectiveness and efficiency. Effectiveness refers to an operation's ability, via its human resources, to accomplish its goals and objectives. Efficiency refers to the ability of the systems that are in place to achieve maximum results with minimum input. Planning helps keep an operation on track and moving forward. Without something to guide us, how do we know where we are going, or if we have arrived? Do you remember traveling as a small child in the car on a long trip and asking your parents, "When will we get there?" A frequent response was, "When we get there!" Without planning, managers are like small children in a car: never sure of when they will get there. A plan forces you, the manager with human resources responsibilities, to think about where you want your hospitality operation to go and how you are going to get there (Figure 2-2).


Planning, or more specifically the results of planing--plans--guide the actions of everyone in the operation. From the dishwasher to bell captain to maitre d' to front desk clerk, plans define both employee and employer expectations. Imagine what chaos would occur if our employees, upon reporting for work each day, did not know what was expected of them! A plan becomes a road map for you and all your human resources to follow as your business develops and grows. Planning can improve productivity and increase human satisfaction.

"Planning has a profound effect on employee
morale--even on retention," states Industry
Advisor Ed Evans. "As I mentioned before,
even in the best managed operations unexpected
things happen. When the unexpected
happens in a hospitality operation it usually
falls to the hourly employee (or associate) to
'handle it.' If these people that you depend
upon cannot depend upon you, their manager,
for LEADERSHIP they will lose confidence
in the professionalism and eventually
the viability of your operation.

"If you can show them that the unexpected
is nothing more than a chance to utilize the
plans you have developed--instead of morale
falling it will rise because your staff will see
that they can master sudden changes in the
operation. You see, with the right plans
NOTHING is unexpected, it just wasn't
expected right now."

Employee morale is also influenced by planning. Morale is extremely important in an environment where people work closely together in a team effort. By the nature of the work in the hospitality industry, our employees work together in decentralized, informal work groups. The dishwashers share a common bond, as do the bellhops, the front desk personnel, the housekeeping staff, the dining room staff in the restaurant, and so on. Being a member of these informal groups means that people share ideas and concerns about the operation they work in and the managers they work for. Have you ever worked for a manager who seems disorganized, who was constantly running around "putting out fires?" The informal work groups in an operation, quick to rally around a manager they have faith in, will rapidly become disillusioned and unmotivated when they begin to wonder: "How did she or he ever get to be a manager? I could do a better job than that." Planning leads to an improved common understanding of operational objectives, which leads to greater cooperation among departmental work groups. Even managers work better together when they know what to expect.

Planning impacts every function in human resources management. For example, planning leads to goal setting, and without goal setting, performance appraisals are not effective. How can managers evaluate how their people contribute to the organization's growth? How do you know whom to hire, or how many people to hire? What should their skill levels be? How much should you pay them?

Planning is the most important factor in the continuing success of any hospitality operation. All aspects of management--finance, marketing, sales, production--are planned. Planning is a management function, and to be a good manager of human resources, you need to know how to plan for your accountability in this area.

Human Resources Planning for Hospitality Enterprises

The hospitality industry has been one of the fastest growing segments of the global economy. Throughout the world increasing numbers of dollars are being spent annually for food, beverage, and lodging away from home. In the United States, hospitality is the largest consumer industry. An industry originally comprised of small chains and independent operators has grown into an industry of multiunit, multiconcept, and multinational conglomerates.

With such rapid growth, you may be asking yourself, "How can I afford not to plan?" You are absolutely correct in your conclusion: You cannot afford not to. Unfortunately, though, many of you can probably think of places where you worked where management failed to plan. What were the common denominators of these operations? Managers who overworked their good employees because they knew they could depend on them in a pinch. Managers always seemed to be in a crisis mode of operation: either overstaffed or understaffed, never having time to train or evaluate your performance. If raises were given, it was because the manager knew who you were. This is what happens in an operation that does not plan, but instead chooses to simply respond to events as they occur (Figure 2-3). Managers seemingly averse to planning choose to rely on intuition, experience, and chance to get them through their day-to-day operating challenges.

The human resources plan should be based upon the hospitality organization's strategic business plan. In some organization's the human resources plan will be a separate document; in others it as a component of the business plan. Because hospitality organizations run their business through and with people, each objective of the business plan contains a human element. Human resources planning is responsible for determining the human resource contributions as well as the processes and activities required to achieve the goals and objectives of the business plan. Evaluating current human resources policies and practices in light of the business goals and determining which new human resources initiatives are necessary are all part of the human resources planning process. In "the next chapter," one of the most important aspects of human resources planning will be determining and monitoring the legal requirements for all human resources policies and practices.


"It is an understatement to say 'you can't
afford not to plan.' ... A more accurate statement
is that 'you will not be allowed not to

"Unless you have the financial means to
totally self fund your enterprise someone will
ask you for your PLAN. Afford is the operative
word--anyone who has provided you capital
(money, product, people) will want to know
how you plan to put them to work generating
REVENUES, PROFITS, Return to the
Investor(s).... If you don't have a plan why
would someone risk investing in you? That
includes employees, who have more choices
than ever of where to invest their time and
energies," states Ed Evans.

Efficient and effective management of human resources requires planning. Achieving the coordination of human resources in a hospitality enterprise is not an easy task. Yet as a manager, your success depends on your ability to achieve results through your people. For your human resources planning to be effective, it must meet the needs of the individuals you hire, the groups they become members of, and the needs of the formal organization. Which of these three needs is most important? To sacrifice any one of these needs is to sacrifice all three.

Consider an additional perspective of the hospitality industry. In a service business such as hospitality, the relationships established between employees and customers (your guests) are of supreme importance. More than 50 percent of the people you hire will come into direct contact with your customers! Do these employees know what to expect in the performance of their jobs? Without planning, probably not.

The human resources planning process drives what all the people in your operation do. You have to know what positions you need to hire for. If you cannot find individuals with the necessary skills, you will have to train to develop the skills you need in your personnel. Without long-range planning, you would not know whom you needed or what skills were available. You would live day-to-day, fighting fires, working many extra hours, and becoming very frustrated.

Planning human behavior is a skill each of us must master to succeed as a manager. The operations side of hospitality management is certainly easier to plan for than the attitudes, behaviors, temperaments, and whims of our human resources. But this does not mean that planning has no place on the people side of management. Figure 2-4 sketches this perspective of a hospitality enterprise for you.


Operations-oriented planning, as shown on the left side of the diamond in Figure 2-4, determines the physical assets. In a food service operation those assets would include, but certainly not be limited to, the menu items to be served; equipment requirements; physical layout of the facility; the china, tableware, glassware, and linens to be used; as well as the purveyors who provide you with the products your plans determined you need.

Behavior-oriented planning, as shown on the right side of the diamond, determines the human assets or resources. This includes influencing what people do, what skills they must have, how long they will perform those skills, upon what basis their performance will be evaluated, and how they will be compensated for their performance in terms of both money and benefits.

Effective human resources planning is a process that can give your operation the competitive advantage over another operation. Planning takes a good idea (vision) and transforms it into a process with predictable results. Without productivity from our human assets, the physical assets have little chance of achieving profitability. As the available labor pool shrinks, management needs to plan increases, as other operations within the hospitality industry compete for the same people. Human resources planning provides the framework for accomplishing all this and, as you will learn, much more!

"The difference between good and great operations
can often be traced back to the planning
process. Obviously, a strong operations
based plan must be in place. What we find is
that more often than not, a behaviorally based
plan is in place.

"For instance, many times when we take
over the operation of an existing F & B operation
we find good people, a good facility, even
good procedures. What we don't always find
are assessments of and plans to resolve
behavioral issues impacting customer service
and satisfaction."

Ed Evans continues with a concrete example,
"Style of service changes from back of the
house preparation to front of the house (display
and cooking). All of a sudden technical
(operational) skills are only part of the equation.
The interpersonal skills of the employee
(the entertainment factor) now play a significant,
even primary role.

"Failing to plan for these behavioral interpersonal
needs is sure disaster."


As a manager with human resources responsibilities, you can already see many reasons for becoming more proficient in planning. To do so allows us to direct our future instead of letting the future direct us. So before we do human resources planning, let us first more clearly define what planning is.

Planning has been defined in a variety of ways. D.W. Ewing offers this definition:

"A method of guiding managers so that their decisions and actions affect the future of the organization in a consistent and rational manner, and in a way desired by top management." (1)

J. E. Miller and M. Porter state simply:

"Planning means looking ahead to chart the best courses of future action." (2)

What these definitions indicate is that planning is foremost a process, or series of actions or behaviors. Actions, such as forecasting and decision making require planning to be a continual process because change is continual. Behaviors such as communication and motivation are necessary to produce the desired outcomes.

During the 1990s the term "planning" from a human resources perspective took on a different and more significant meaning. It was no longer enough to think of planning merely as a process of matching supply to demand. The labor supply was dwindling, and the business demand was growing in many markets. In the past, plans were developed and implemented that guaranteed that the right number of people would be available in the right numbers at the right time. Business needs were fairly predictable based upon historical data. Therefore if business increased by 14 percent during the busy season, you would plan a work-force increase of 14 percent.

The drastically changing environment in the 1990s made the planning process much more dynamic than in previous decades. The hospitality industry experiences acquisitions, mergers, new and increasing amounts of employment legislation, diversity, downsizing, and other issues. Look, for a moment, at just some of the facts about the U.S. labor force:

* By the year 2005, 23 million people will have left the work force, and 39 million new employees will have joined.

* By the year 2005, the average age of the work force will be nearly 40.

* The fastest growing work group population will be Asian workers, followed by Hispanics, largely due to immigration and an increase in birth rates of these two groups.

* By the year 2005, women will make up roughly 48 percent of the work force.

* Service work is expected to be one of the fastest growing occupations.

* Two and a half million functionally illiterate Americans enter the work force each year. (3)

For this book we continue to define planning as a process of collecting information that allows hospitality managers to make decisions in order to formulate objectives and determine which actions are most appropriate in achieving those objectives. This definition views planning as a process. It allows managers of human resources to remain flexible, a necessity in a changing environment. The result of planning, the plan itself, is a product of the process. The framework for human resources planning that we now begin to build answers the following questions:

* How many people do you need?

* What kind of people, with respect to skills and abilities, do you need? (Figure 2-5)

* Where will you find the type of people you need?

* How will you keep the people you need and prevent them from being hired away by other companies?


Hospitality managers typically have technical competence, but the exceptional managers who want to grow in both ability and achievement possess planning skills. No longer will you have to operate by hunches and intuition. To plan, you must step back, know the key business issues in your company, understand the impact of the changing external environment surrounding you, consider the long- and short-term human resources implications of change within your organization, forecast the future, anticipate what will be the desired outcomes, and determine how they should be accomplished.

At the beginning of this chapter you were asked to think of a hospitality operation that you might like to work in as a manager with human resources responsibilities. We said that the size and scope of the operation did not matter because the principles of planning we discussed are applicable in any of the situations in which you imagined yourself. There is no one best system that applies in all situations. Hospitality operations differ in their objectives, their complexities, the types and number of services they offer, the external and internal environments they operate in, and the resources they have available to them. Therefore, the degree to which you can implement the approaches and techniques discussed must be evaluated in light of the situation in which you are operating. There is, however, a systematic process of human resources planning that is appropriate to all situations in the hospitality industry. If you understand the process by which a human resources system is developed, you can then modify the system to fit your particular situation.

The systematic process we are referring to begins with forecasting, discussed next.


Planning is not forecasting; however, forecasting is one of the activities that make up the planning process. As Ewing points out,

"Equating the two is probably the oldest trap that managers and teachers in business ... have fallen into." (4)

It is possible for planning to occur without being involved in forecasting. In human resources planning, forecasting is where the process begins. It is important for you to recognize the distinction between the terms planning and forecasting.

What Is Forecasting?

Forecasting involves an analysis of the environment to determine what future needs will exist, and what opportunities there will be for us to fill them. On the basis of estimates and predictions, forecasting makes assumptions about the future. Forecasts about the future environment enable you, as a manager with human resources responsibilities, to reach assumptions that provide guidelines for all of your planning activities. Forecasting is concerned with the events that occur in a changing world. It does not matter what size your hospitality operation is because forecasting will continue to play an important role in the effectiveness of management's decision making and ability to perform. The hospitality industry is a volatile enterprise and, as such, we must learn to make forecasts and use them in our planning process.

Forecasting is defined as the task of making educated predictions about the future of the hospitality industry formulated on the basis of data and estimates that better enable us to plan for a changing business environment.

Depending upon your hierarchical position within the company, the scope of your forecasts will vary. As an example, the chief executive officer (CEO) of a corporation may have a mission for the corporation. That mission may be to become the premier hospitality corporation in North America with an annualized x% return to shareholders and an x% annualized growth rate. The vice president of an operating division may have a goal of being the market leader in his or her business(es) with sales growth of x% and an operating profit of y%. The staff members supporting this vice president then put together functional plans to support the mission and organizational goals. If you were a director of human resources, your forecasts would focus on management and hourly people needs and supplies for specific operations and/or geographies. If, on the other hand, you were manager of a specific operation or department, you would focus on forecasting to determine what your unit human resources needs were and then work toward meeting those needs.

ARAMARK Food and Support Services uses
human resources planning in a variety of ways
according to Ed Evans. "One of the best examples
is through our Bandwidth Gap Analysis
form [see Figure 2-6]. Due to the estimated
growth and matriculation at ARAMARK, we
will need one manager every eight hours, 24-hours
a day, to fill our management needs.
A forecast of our future management needs
becomes extremely important.

"Every region develops a forecast for the
amount of managers needed in their region
for the end of the current fiscal year and the
next fiscal year (Column A). The current number
of managers is indicated (Column B), in
addition to the candidates who are in line for
a promotion (Column C) and managers we
hired specifically as benchstrength (Column D).
Once the region projects their turnover,
whether through termination or promotion
(Column E), an amount of currently available
managers can be calculated (Column F).
Our management need, or Bandwidth Gap
Analysis (Columns G and H), can be forecasted,
by taking the delta of the number of
managers needed (Column A) and the number
of currently available managers (Column

"By utilizing this as a resource in human
resources planning, ARAMARK is able to
strategically devise a realistic number of management
needs throughout our organization.
In doing this, we can better plan our recruitment
efforts to meet our needs."


There is no one way in which forecasting is applied. The method you select is the one that best meets your needs and your assumptions about the environment in which your unit must operate. In other words, concentrate on the areas of greatest importance by asking yourself, "Which areas will influence our future success in this market?" Table 2-1 is a list of some considerations you must take into account when forecasting. As we will see next, forecasting involves both the forecasting of human resources demands and the forecasting of human resources supplies.

Determining Human Resources Requirements

Human resources forecasts stem from the operational plans of finance, sales, marketing, and production. Predicting the number of employees that you will need to recruit, hire, train, develop, transfer, and promote is based upon operational objectives. These predictions are made for a specific period of time, generally on an annual basis. The methodology for determining your human resources requirements depends on whether you are forecasting management or hourly employee needs.

Demand for employees is based upon a combination of variables that are common to all operations. These variables would include the expected productivity levels, the demand factor for your products and services, projected turnover, and projected growth rates. Entwined with these variables are the financial performance objectives of your organization. In the hospitality industry the process is further complicated by the fact that the variables differ by job category. Turnover rates, for example, change depending on whether you are forecasting management or hourly needs. And among hourly employees, the turnover rate can further vary between dishwashers and waitpersons, between bellpersons and front desk personnel, or between any two other job categories you might like to compare.

Forecasting in the hospitality industry has been handled typically on a qualitative or intuitive, nonstatistical basis. This is predominantly the case when forecasting hourly human resources needs. To quantify this approach, you need to identify the number of employees by job category for a specific period of time. Table 2-2 shows a simplified example of this forecasting approach done on an annual basis. For the purpose of this example, we will assume that the operation is currently fully staffed.

Once the number of employees per job category is identified (through human resources inventories), the percentage of hourly work force per category is calculated. Forecasts made for the upcoming year would use the same percentage breakdowns as a proportion of human resources needed by each job category. Thus, if sales were projected to increase, the proportion of buspersons needed would still represent 10% of the total work force. Caution: You must be conscious of the fact that these increases may not always follow a simple geometric progression based upon volume. In many businesses, thresholds exist that have some absolute range where a set number of employees can handle a set range of customers (e.g., if the minimum number of wait staff is two, they can handle 0-40 customers, as opposed to an absolute number).

Management needs can also be forecasted on both a qualitative and a quantitative basis. Qualitatively, you could estimate your management requirements as a measure of sales volume and company goals. For example, based upon what corporate management feel needs to be accomplished with respect to quality of service, they want to raise the number of managers per operational unit from two to three. Quantitatively then, with a goal of three managers per unit, it is easy to calculate projected management needs for the next several years. Taking into account planned growth, length of training programs, and turnover ratios, you know exactly how many management trainees to hire and when to hire them.

The methods used in forecasting have become more sophisticated in the past decade with respect to objectivity and reliability. The quantitative techniques available do help to increase the accuracy and reliability of predicting human resources requirements.

Forecasting Variables

Forecasting deals with a common set of variables that follow operational lines within an organization. Specifically related to human resources management, manpower planning variables to be forecasted include the following:

* Changing customer's demands

* Product demand

* Labor cost trends

* Availability of labor (unemployment rates)

* Number of employees needed per job category

* Need for additional training

* Turnover per job category

* Absenteeism trends

* Government regulations affecting

--labor costs

--changes in working hours

--changes in retirement age

--social security benefits

* Legal conditions of employment

* Unions

Each of these forecasting variables must be considered and addressed for the particular environment you are working in to identify the skills and people required at both hourly and management levels (Figure 2-7). Forecasting should be viewed as a tool to improve decision making surrounding human resources requirements, and as the key to achieving organizational objectives in a well-planned hospitality enterprise. Good decision making requires having as much information as possible to make rate predictions about the future.


The Forecasting Function

The techniques we are discussing are largely necessitated due to increasing competitiveness within the hospitality industry and the shortage of employees. Regardless of the operation size, forecasts play an increasingly important role in the effectiveness of management decision making and performance ability.

Uncertainty is part of forecasting. Your forecasts are only as good as the data and information that goes into their formulation. In hospitality organizations, historical data is typically the basis for forecasting. When historical data is not available, as when you open a new operation, forecasts must rely more on qualitative, rather than quantitative data. Qualitative data includes managerial judgment and good sense, or what may be referred to as subjective estimates. According to Ed Evans, "The secret or trick here is NOT to be bound by your paradigm. Einstein is credited for having said that 'NO problem is ever solved at the same level of understanding that it was created on.' This certainly applies to the HR planning paradigm."

We have identified the following questions as important to ask when forecasting human resources. But remember, the questions you must ask are determined by the areas that are critical to your success. What information must you absolutely have in order to continue the planning process? The answer to that question will lead you to developing the appropriate questions for your particular situation.

Here are some suggestions to get you started:

* What is the prevailing hourly wage in your market?

* What is the unemployment rate? In other words, how discriminating can you be?

* Will you have to train employees to achieve the skill levels you require or will you hire them from other organizations?

* What has been the nature of your labor pool in the past?

* What influences will cause the labor pool to change?

* What will the skill levels of the labor pool be in the future?

* How successful have you been at attracting the skill levels you need?

* What effect will new competition in your market area have on the availability of labor?

Forecasts can serve as a valuable management tool when targeted to fit the particular needs of your hospitality operation. Again, there is no one correct approach to forecasting human resources requirements. Approaches differ from company to company, just as demographic considerations vary widely from location to location.

In general, human resources forecasting in the hospitality industry is both qualitative and quantitative. Many organizations conduct labor productivity studies, and there are numerous, tested quantitative models available to you to assist in forecasting human resources requirements. Examples of statistical procedures used include time-series analysis, regression, and correlation techniques. Just because these quantitative models are not used frequently does not mean they have no value to you; they do. Mastering quantitative forecasting techniques will make you better prepared to face human resources planning. As the hospitality industry continues to grow in sophistication, and computer technology is now found in even the smallest mom-and-pop operations, the use of these quantitative methods has increased. The handling of mass quantities of historical data is as easy as turning on your computer. Hospitality managers in "the next chapter" must be as comfortable with analysis as today's managers are with intuition.

Ed Evans states, "We have mentioned behavior
vs. operations orientated planning earlier in
this chapter. We must quantify as many variables
as we can in order to effectively plan.
There is a point at which the numbers just
don't get you there. Have you ever had an
experience at a restaurant, or hotel that you
knew according to 'the documented procedures
and policies' was perfect but you as a
guest/customer left feeling less than satisfied?
Conversely have you had an experience when
you knew things didn't go 'according to the
plan' but you had a terrific experience--one
that you recommended to others or caused
you to return again and again?

"Herein lies the difference between the hospitality
industry and the manufacturing or
consumer products industries--in hospitality
once you have done all the quantitative planning
and analysis you have an additional
dimension--'the how does it feel' dimension.
Too often the mistake we make in hospitality
is that we think it is an either/or decision. It's
not--it's both.

"To use an over-simplified analogy, quantitatively
we must know HAACP/Food sanitation
to be sure that in a F & B environment we
serve a safe product--that being said we still
may lose customers if they don't like it or the
environment created for consumption or vice
versa if they like the environment but it makes
them ill ..."


Effective human resources planning refers to identifying and selecting the right person for the right job at the right time. The right person refers to the appropriate qualifications in terms of skills and experience. The right job implies that a careful analysis has been done to determine what the work requires in both mental and physical energies. The right time would indicate some knowledge of projected needs.

Figure 2-8 presents an overall view of the needs-versus-supply analysis through which the human resources process evolves. The human resources process begins with organizational goals and objectives and adds those to the data gathered through your trend forecasts. This determines the human resources requirements for your operation. Next, you need to identify the status of your current work force while also taking into consideration your employees' career goals, and compare that with an inventory of your current human resources skills and numbers. This comparison gives you an analysis of your human resources supply. A gap between your needs and supply, either as a shortage or surplus, indicates that corrective action needs to be initiated by management. As is true with all human resources planning activities, the entire process is governed by budgetary considerations.


Many of the functions in human resources planning occur simultaneously. When you assume human resources responsibilities in an existing operation, the planning process must occur while products and services are being offered to your customers. You will not have the advantage of having your system planned and in place before the doors open for business. How quickly you will be able to develop your plan will depend largely on how much information about the employees has been kept on a historical basis.

The remainder of this chapter is spent on determining goals and objectives. Chapter 3 studies job analysis and job descriptions along with conducting human resources inventories to identify the gaps between the overall job category requirements (demand) and current supply. Plans developed to close these gaps become the decision-making basis for recruitment, placement, training, and the development of human resources.

Goals and Objectives

Planning stems from both long-range (possibilities of diversification in products and services) and short-range (How many covers do we want to be able to serve tonight?) goals. Long-range goals provide growth, viability, and development; short-range goals keep the operation running day-to-day.

What will our customers' perceived needs be? This is one of the first questions we must ask. We can then, based upon these needs, make decisions that will determine how we can best achieve customer satisfaction, or even better, exceed expectations. And that is why we are in the services business: to make a profit by satisfying customer perceived needs (Figure 2-9).

To begin with, you must keep in mind that the appropriateness of any objective is contingent on the particular situation in which it must be used. Simply stated, objectives specify what an organization or operation desires to accomplish. Much literature has been devoted to the topic of goals and objectives, and each author has selected his or her own interpretation of how to define goals and objectives. For our purposes in this text, operational objectives stem from organizational goals, which are determined by the corporate mission (Figure 2-10). Furthermore, in human resources management we are primarily concerned with the operational objectives of our specific arena. Again, because managers with human resources responsibilities do not operate in a vacuum, all other operational objectives both affect and are affected by what we do.


The corporation's mission statement is fundamental to the business plan. A mission statement sets the overall direction for the corporation. Some companies, such as ARAMARK, develop vision statements (Figure 2-11). The organization's goals then follow directly from the mission statement. Typically, goals are developed for each of the business areas such as sales and marketing, development and physical plant. ARAMARK uses Guiding Principles (Figure 2-12) that each employee is expected to know and follow. Corporations are increasingly integrating their human resources strategies into their overall business strategies. Hence, "in the next chapter" the human resources goals are linked horizontally to the business goals of the entire organization. This more closely connects the human resources plan with the rest of the organization's business plan. What are the organizational goals and how does human resources management fit into those goals? What are the implications for human resources? This then determines the organizational goals for human resources.




Remember that the lower your position in the organizational structure, the more narrow and focused (micro) your objectives become. The higher your position in the organization, the broader your objectives (macro). Each level in the organization must take into account the objectives of its superiors when developing objectives for a unit. Though incorporation of the corporate mission follows a top-down path, generally human resources objectives must follow a bottom-up path in planning to effectively support the mission statement.

Do you forecast first or set objectives first? They are related. To say that one must follow the other should not imply some greater importance to one than the other. The operation's success is dependent upon each function in the planning process being effectively carried out, but it is helpful to first set your operational and human resources objectives in order to effectively forecast human resources needs.

Determining Objectives

Objectives are stated in terms of actions or activities. Notice the objectives at the beginning of each chapter in this book. The manner in which they are written always states an action that will occur as the result of your participation in the reading material.

A second characteristic of the operational objectives is that they are specific, meaning that they can assist the hospitality manager in his or her decision-making process (Figure 2-13). Objectives should also state a time frame in which they are to be accomplished. Without a time frame it is up to the hospitality manager responsible for carrying out the objective to determine if it is to be accomplished within this week, this month, this year, or perhaps five years from now. In other words, is this a short-range or long-range objective?

Objectives must also be consistent with each other as well as with organizational goals. This is of particular importance in the hospitality industry where you have several decentralized departments all operating under common organizational goals. The operational objectives of the housekeeping department must complement the operational objectives of the front desk; the operational objectives of the food and beverage department must complement the operational objectives of the sales department; and so on and so forth.


Even within departmental units, objectives must be consistent and complementary. If one objective for the food and beverage department is to increase service quality and another is to lower labor costs, they may well be in conflict. Is it possible to increase quality and at the same time lower costs? Can the manager achieve only one of these objectives at the expense of the other? If objectives do not support a common goal but rather create a conflict and a sense of frustration, no matter what objective the manager chooses, he or she is doomed to failure.

Objectives for Human Resources Management

Objectives, for managers with human resources responsibilities, state desired outcomes that provide guidance in attracting personnel within a specific time frame. Objectives can be thought of as expectations with respect to evaluating not only operational performance but human performance (productivity) as well. Objectives for managers with human resources responsibilities are used for defining acceptable performance, determining what kinds of recruitment activities are necessary, reducing turnover (employee satisfaction), and individual development plans for both hourly staff and management.

Remember the earlier example about menu planning? The menu should dictate everything required on the operations side of the hospitality enterprise. Does it? Not always. Should it? Yes. The same analogy can be used in thinking about human resources objectives. The objectives we develop should dictate our human requirements. The number of people currently on the payroll should not form the basis for dictating our human resources needs.


The employee handbook is a manual that contains information that is useful to the employee. This may include historical information on the company, corporate mission statement, organizational goals, commitment to customer service, along with work rules, procedures, and policies that the employee must follow. The purpose of the handbook is to communicate information that is important and relevant to the employees while at the same time educating them about the hospitality organization. Some hospitality companies have very strong corporate philosophies about certain policies. Often times they will place statements such as these at the front of the handbook:

* We are an equal opportunity employer.

* We enforce a drug free workplace.

* We promote from within when and where possible.

* We provide our customers with the highest service possible.

The purpose of an employee handbook is to pass on valuable information to your employees. You can identify your expectations of them along with what they can expect of you. Identification of your service policy and philosophy is an important component of an employee handbook for a hospitality organization. Tell your employees about your place in the hospitality industry as well as in the local community. Tell them what makes your operation a good place to work. When viewed from this perspective, handbooks can be a helpful positive tool for your valuable human resources, a source of information presented in a consistent way for all who work in your hospitality organization.

However, employee handbooks also carry with them certain obligations and risks. There is a danger that you have created an employment contract with your handbook that could make it difficult to terminate employees. And if you want to change any of the workplace rules or benefit offerings, you may find yourself liable to your employees. With the increase in employment litigation, some employers have found themselves being legally bound in a court of law based on what they wrote in the employee handbook. At other times employers have found that their employee handbook has kept them out of court. Because most employee handbooks are intended solely as a useful resource for information, disclaimers are often found as part of the content. At a minimum, make sure that your lawyer reviews your handbook before you give it to your employees. Not all situations can be anticipated, therefore be prepared to modify and revise your handbook when necessary.

Handbooks should be written in a friendly and positive manner, clearly written and well organized. At the same time a certain amount of legal language will be necessary in our litigious society. Disclaimers need to be stated clearly if they are to be effective. At their best the employee manual can and should be a valuable communication tool between employer and employee. It can serve as a excellent guide for the orientation (Chapter 6) of your employees. If care is not taken to have the information reviewed carefully by a lawyer, employee handbooks can backfire on you. Remember to review them regularly and make updates as needed.

Ed Evans feels that "the impact of the employee
handbook is underestimated by many hospitality
industry managers. You absolutely
must have your handbook reviewed by a legal
expert, but not just any legal expert. Select one
who is knowledgeable in personnel law and
not only in personnel law but federal, state
and local since there are inconsistencies
among them.

"There is also a double standard to watch
out for here. Although you as an employer
may be held liable for items contained within
your handbook, your employee will not be
held liable for following it unless it can be
shown that the employee actually received the
current version of the handbook (e.g., a dated
signature page for the employee file).

"Employee handbooks can range from one
page, even one statement (e.g., Nordstrom) to
hundreds of pages. Whatever it looks like,
make sure that it is accurate in its depiction of
your organization and current with regard to
your policies, practices and procedures.

"And, oh by the way ... if you have a
diverse workplace, you may want to have it in
multiple languages and have made accommodation
for functionally illiterate employees."


Human resources management objectives identify the continuing results that must be obtained to meet the human resources goals of your organization. Objectives are what you will accomplish through an effective utilization of human resources. Remember that these objectives are based, in part, upon the information you gathered in forecasting, pertaining to costs and availability of labor in the geographic area you will be operating in. Once the goals and objectives are established, action plans are then developed that identify the decisions and activities that must be taken to meet your objectives through implementation. Human resources planning establishes goals and objectives based on the corporation's mission statement. The planning process then outlines the procedures and assigns responsibilities in order to achieve the desired results.

Human resources planning has proven to be one of the most important determinants for an organization to succeed. It is integrally linked to the business plan. When things don't work out the way you expect, then it is time to revisit your original assumptions and if necessary revise the plan.

All human resources functions develop from planning. Planning therefore should not be viewed as a single exercise for analyzing staffing needs but rather as a continuous process. People are the key element in any hospitality enterprise. Planning efforts to better capitalize upon the operation's human resources are critical. The human resources planning function requires that both operational and personnel objectives be combined to meet the goals of the organization. Although human resources functions usually do not include the development of operational objectives, this is one of the numerous occasions where the human resources arena interacts directly with other departments within the organization. Human resources management cannot and does not act independently of the rest of a successful organization.

As the number of the people available becomes increasingly limited, we need to become better planners, committed to the efficient utilization of those human resources we have. Established objectives, developed through our forecasts, become the focal point for planning all other human resources functions. It is important, then, that the objectives clearly state the results we need the achieve. The results allow us to determine the jobs necessary to achieve the objectives. Hence, the objectives become the basis of our job analysis and determine the job categories that are necessary to accomplish the work activities of our organization.

Welcome to your new job as the manager with
human resources responsibilities for the La Cesta
Resort. This beautiful property is located on the
west coast of the state of Florida and borders
both the Gulf and the Bay. It is a full amenity
resort that caters predominantly to upper-middleclass
families. The property is halfway
through a five-year renovation plan to update the
rooms. The two restaurants (one open air casual
and the other fine dining) have already been
renovated along with the bar/nightclub.

La Cesta Resort has a good name in the
state of Florida. It provides nice amenities for its
guests. The problem? Other similar properties are
doing quite well (with respect to revenue and
profit) and you are not! You have been hired
specifically because of your expertise in the area
of human resources planning. Develop an HR
plan to analyze and address the problem.

The General Manager of La Cesta Resort has
asked you to submit a detailed three-page outline
of your initial plan by next Tuesday. In addition to
providing any other information you feel you
should include (based on your HR planning
expertise), she has specifically requested you to
do the following:

* Develop a mission statement for this property.

* Include a minimum of two organizational
goals specific to human resources management.

* Prepare one operational objective for each

* Present a list of six observations you have
made about the property based on your
initial analysis of the situation.

* Prepare a two paragraph statement defending
how your human resources plan
will specifically address the problems with
respect to revenue and profitability.

Just a reminder that your task is to develop
an HR plan to analyze and address the reasons
why La Cesta Resort is not doing as well as other
similar resorts. Be sure to include any additional
information in your initial three-page report that
you feel would be appropriate.


You have decided to become an entrepreneur in
the hospitality industry and open your own food
service operation or lodging property. Use the
hospitality operation that you described in Case
Problem 1 to draft an abbreviated three-page
human resources plan.

Begin by deciding what items should be
included in the framework of your plan. How do
you plan for style of service? How do you plan
for level of service? What top three variables in
human resources management would you have
to consider? How many people do you need?
What kind of people, with respect to skills and
abilities, do you need? Where will you find the
type of people you need? Include answers to any
other questions you feel would be appropriate
as part of this abbreviated HR plan.


You have inherited the human resources responsibilities
for a 200-seat family style restaurant in
New Orleans. There is no employee handbook.
Would you implement one and why? Develop a
three-page outline for the sections that this handbook
would contain. Whom would you involve in
the development of this handbook? What review
steps would you go through?


behavior-oriented planning

corporate mission



employee handbook


forecasting variables

hospitality enterprise

human resources planning

job analysis

operational objectives

operations-oriented planning

organizational goals


qualitative forecasting

quantitative forecasting


"Population Demographics." 1998. (26 July 1998).

"Encyclopedia of Associations." 1998. (26 July 1998).

Bailey, A. D. 1992. "The Quick Way to Produce an Employee Manual." Restaurant USA 12(8): 16-18.

The Conference Board. 1996. HR Executive Review--HR Challenges in Mergers & Acquisitions. New York: The Conference Board.

de Geus, A. 1994. The Living Company: Habits for Survival in a Turbulent Business Environment. Boston: Harvard Business School Publishing.

Galpin, T. 1993. Making Strategy Work. San Francisco: Jossey-Bass Publishers.

Harkins, P. J., S. M. Brown, and R. Sullivan. 1995. Outsourcing and Human Resources: Trends, Models, and Guidelines. Lexington: LER Press.

Inman, C. and C. Enz, 1996. "Shattering the Myths of the Part-Time Worker." The Cornell Quarterly 36(5): 46-54.

Smith, B. J., J. W. Boroski, and G. E. Davis. 1992. "Human Resource Planning." Human Resource Management (Spring/Summer): 81-93.

Tulgan, B. 1996. "Common Misconceptions about Generation X." The Cornell Quarterly 37(5): 46-54.

Walker, J. W. 1996. "Integrating the Human Resource Function with Business." Human Resource Planning 14(2): 59-77.

Walkup, C. 1995. "Companies Vie for Workers as Labor Pool Evaporates." Nation's Restaurant News 29(8): 1,4.


1. Court TV Legal Help: Model Employee Handbook Online:

2. HR Strategies & Tactics:

3. HR Tools:

4. Policy Handbooks on the Web:

5. EEO/Affirmative Action Policy:

6. HR Policy Manual:

7. Emory University Employee Handbook:

8. Loyola University Policy and Procedures on Sexual Harrassment:

9. HRM Manuals and Handbooks Online:


1. Where does the human resources process begin? Why?

2. Describe the importance of planning and the changing environment within the context of human resources management.

3. Why don't we do a better job of human resources planning in the hospitality industry?

4. Human resources planning controls what all people do in your operation. Comment on this statement.

5. What is forecasting? How does it differ from planning?

6. Are hourly and management needs forecasted in the same way? Explain.

7. Identify seven considerations you must take into account when forecasting.

8. Forecasting in hospitality is largely based on historical data kept by the property or operation. What does this historical data consist of?

9. Describe the needs-versus-supply analysis in the human resources process.

10. Discuss the top-down and bottom-up approaches in determining objectives.

11. Explain why operational objectives must be consistent with each other.

12. Describe the importance of goals and objectives in the human resources planning process.

Mary L. Tanke, Ph.D.

Florida International University


(1.) D. W. Ewing, The Practice of Planning (New York: Harper and Row, 1968), 17-18.

(2.) J. E. Miller and M. Porter, Supervision in the Hospitality Industry (New York: John Wiley & Sons, 1985): 301.

(3.) "Charting the Projections: 1992-2005," Occupational Outlook Quarterly (Fall 1995): 1-27.

(4.) Ewing, The Practice of Planning, 16.
TABLE 2-1 Forecasting Considerations

* Competition
* Demographic Shifts (both customer and work force)
* Economic Environment
* Governmental Policies and Regulations
* Technological Advancements/Changes
* Trend Analysis
* Societal and Cultural Differences
* Services/Products Demand
* Financial Resources
* Turnover
* Management Philosophy/Corporate Culture
* Education of the Work Force
* Unemployment Rate

TABLE 2-2 Forecasting Hourly
Human Resources Needs

                      Current                            Projected
                       Year                                Year
Job                  Number of         of Total          Number of
Category             Employees         Workforce         Employees

Waitpersons             48                40%               64
Hostesses                6                 5%                8
Buspersons              12                10%               16
Cashiers                 6                 5%                8
Dishwashers             12                10%               16
Cooks                   20                17%               27
Production              16                13%               21
  TOTAL                120               100%              160

FIGURE 2-6 Business Services, Bandwidth Gap Analysis.
(Courtesy of ARAMARK Corporation)

Business Services
April 1, 1997


                                       A                       B

                                   Number of
                                Managers Needed
                                                           Number of
      Management            END OF          END OF          Current
      Bandwidth             FY 1998         FY 1999        Managers

Multi-Unit Management/
Functional Staff
AE 11:14

Front Line Management
AE 09:11

Front Line Management
AE 07:08

Assistant Front Line
AE 06 and Below

             TOTALS =          0               0               0

                               C               D

                           Number of
                          Candidates       Number of
                         for Promotion   Benchstrength
      Management         in Next Lower     (Reserve)
      Bandwidth            Bandwidth       Managers

Multi-Unit Management/
Functional Staff
AE 11:14

Front Line Management
AE 09:11

Front Line Management
AE 07:08

5                              0
Assistant Front Line
AE 06 and Below

             TOTALS =          0               0


                              Number of Projected
                                from Bandwidth

                              (1)             (2)
                             NOW--           NOW--
      Management              END             END
      Bandwidth             FY 1998         FY 1998

Multi-Unit Management/
Functional Staff
AE 11:14

Front Line Management
AE 09:11

Front Line Management
AE 07:08

Assistant Front Line
AE 06 and Below

             TOTALS =          0               0


                               Number of Currently
                               Available Managers
                                 (B + C + D - E)

                              (1)             (2)
                             NOW--           NOW--
      Management              END             END
      Bandwidth             FY 1998         FY 1999

2                              0               0
Multi-Unit Management/
Functional Staff
AE 11:14

3                              0               0
Front Line Management
AE 09:11

4                              0               0
Front Line Management
AE 07:08

5                              0               0
Assistant Front Line
AE 06 and Below

             TOTALS =          0               0

                               G               H

                               6              18
                              MON             MON
      Management              GAP             GAP
      Bandwidth             (A - F)         (B - F)

2                              0               0
Multi-Unit Management/
Functional Staff
AE 11:14

3                              0               0
Front Line Management
AE 09:11

4                              0               0
Front Line Management
AE 07:08

5                              0               0
Assistant Front Line
AE 06 and Below

             TOTALS =          0               0
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Title Annotation:Section 1 Human Resources Planning and Organization
Author:Tanke, Mary L.
Publication:Human Resources Management for the Hospitality Industry, 2nd ed.
Geographic Code:1USA
Date:Jan 1, 2001
Previous Article:Chapter 1 Introduction to contemporary human resources management.
Next Article:Chapter 3 Analysis of the workplace.

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