CHINESE state-owned hotels need to enhance their performance and market competitiveness, according to Kam Hung and Hanqin Qiu of the School of Hotel and Tourism Management (SHTM) at The Hong Kong Polytechnic University, along with co-researchers, in a recently published research article.
Having conducted interviews with both managerial and non-managerial hotel staff, the researchers have identified that little distinction between the ownership and management of the hotels, the lack of a profit motive, the absence of staff incentives, and the inability to match private sector competitors are the causes of inefficiencies.
Due to the lack of a clear distinction between ownership and management of the state-owned hotels, managers are not free to make their own decisions without interventions from the government. Any decisions that are made are usually subjected to lengthy delays while waiting for approval.
There are also accusations from interviewees that priority is given to providing hospitality services to government officials.
Despite these complaints, the interviewees also noted that managers of state-owned hotels are more loyal to their employers compared to those in the private sector, and the style of management is more “humanised”.
Furthermore, high staff turnover rates do not seem to be a problem among employees of state-owned hotels. They seem to enjoy regular staff meetings, social activities, and “abundant training and internal promotion opportunities”.
Nevertheless, researchers note the lack of staff motivation in state-owned hotels. These positions may provide job security but offer no incentives for employees to excel.
The researchers conclude with the suggestion that management be shifted to the regional level to remove competition among local state-owned hotels, to elevate their competitive power in the market, and to take advantage of the ”premium geographical location” of many state-owned hotels.
