Text 9. HAVE a NICE DAY

EmployeeLoyalty in Service Firms

Hotel, shops and restaurant chains, which employ thousands of people in low-paid, dead-end jobs, are discovering that high labour turnover rates resulting from the indiscriminatehiring of “ cheap ” workers can be extremely [Iks'tri:mlI] costly.

Cole National, a Cleveland-based firm which owns Child World, Things Remembered and other specialty shops, declared a “war of people” in an effort to recruit and keep better staff.

Employees were asked: What do you enjoy about working here? In the past year, have you thought about leaving? If so, why? How can we improve our company and create an even better place to work? Employees replied they wanted better training, better communications with their supervisors and, above all, wanted their bosses to “make me feel like I make a difference.” Labour turnover declined by more than half; for the full time sales assistants, it declined by about a third.

Marriott Corporation, a hotels and restaurants group, has also decided to spend more money on retaining employees in the hope of spending less on funding and training new ones. In one year, it had to hire no fewer than 27,000 workers to fill 8,800 hourly-paid job slots.

To slow its labour turnover, Marriott had to get a simple message accepted throughout its operating divisions: loyal, well-motivated employees make customers happy and that, in turn, creates fatter profits and happier shareholders. Improved training of middle managers helped. So did a change in bonus arrangements.

At the same time, Marriott became more fussy about the people it recruited. It screened out jobapplicants motivated mainly by money: applicants which the company pejoratively described as “ payfirst people”. Such people form a surprisingly small, though apparently disruptive, part of the service-industry workforce. Marroitt found in its employee-attitude surveys that only about 20 % of its workers at Roy Rogers restaurants and about 30% of its workers at Marriott hotels regarded pay as their primary reason for working there.

Many middle managers in service industries are more comfortablecoping with demands for more money than with demands for increased recognition and better communications. They will have to change their ways.

Surveys say that when 13,000 employees in retail shops across America were asked to list in order the 18 reasons for working where they did, they ranked “good pay” third. In first place was “appreciation of work done”, with “ respect for me as a person” second.