How middle managers in international hotels in New Zealand manage contingent labour

Abstract

This research is a grounded theory of the management of contingent labour by middle managers in international hotels in New Zealand.

Contingent labour is used extensively in hotels internationally as well as in New Zealand with the workforce composition being dynamic in terms of culture, tenure and general demographics. The use of contingent labour is for reasons of seasonality and economics in terms of labour costs. The extensive use of this dynamic labour force has seen the introduction of systems (and systems management) in most areas of operations to cope with issues of maintenance of standards and service levels, yet, in so doing has reduced managerial autonomy.

Respondents find that managing this dynamic workforce, even with the benefit of organisational systems, is a challenging task. From my fieldwork I found middle managers feel pressured to choose between two managerial dimensions – rationalism and humanism. Collins and Porras (1994) propose that this is a trap for managers in that they may succumb to the 'tyranny of the OR' - managers can be either rationalistic OR humanistic. However, I found that respected managers harness what Collins and Porras call the 'genius of the AND', that is, they are not trapped by this polarity and as such have mastered and utilise systems and married this with building relationships with their staff. Indeed, effective managers place relationships, in the form of building social capital, ahead of systems in the belief that this eventually brings greater business success.

Humanistic managers are not necessarily satisfied with achieving the minimum standards that systems are intended to achieve. Instead they push for increased (business) outcomes. However, humanistic management is not without its costs, with such managers experiencing higher levels of stress and burnout - often resulting in resignation. Rational managers, who simply follow the systems experience less stress, but are also less likely to exceed desired standards.

The paradox for the hotel industry is that with respected middle managers being few in number and difficult to recruit, losing such managers risks damaging the organisational knowledge base and organisational social frameworks. Ultimately, such damage flows through to influencing the way in which contingent labour employees interact with guests; an area which is a hotels' prime competitive advantage. The key practical message for senior managers in international hotels is that it will help if they are more aware of the development of social capital in their organisation, who develops it, and the risk to those who do. Failure to recognise and support the builders of social capital could impact negatively on the achievement of business objectives.