SHRM – CASE STUDY

https://www.shrm.org/hr-today/trends-and-forecasting/research-and-
surveys/Documents/SHRMIndiaBestworkplaces.pdf

In the words of J. Willard Marriott, “When you take good care of your people, they will take good care of the
customers, the customers will come back and the business will take care of itself.”This is the core value of
Marriott Hotels. This case study showcases Marriott's employee, or as it calls them 'Associates,' engagement
practices. Built strongly on its core value, Marriott takes 'Associate Engagement' to a level rarely achieved by
competitors in the industry. The engagement drivers emphasised by the organisation include leadership
excellence, personal growth, and quality of life at work, teamwork and total rewards.

While Marriott uses several ways to optimise each of these drivers, this case study will highlight a few unique
and exemplary best practices, which could serve as a gold standard for the hotel industry.

BUSINESS CONTEXT
The Marriott portfolio encompasses over 3,600 managed and franchised properties across 20 brands in 71
countries and territories spanning six continents. This includes more than 40 hotels in India. At the end of 2010,
Marriott had approximately 129,000 Associates and reported sales of nearly $12 Billion.

Marriott is a hotel management company. It does not own hotels but takes the responsibility for running them
through long-term contracts with owners of the respective properties. Marriott Associates are the key to
consistent excellence in the delivery of service across the chain. Hence, Marriott views its employees as the
single most important factor for success. It invests seriously on training, developing and mentoring its
employees for future growth in the organisation. Employee engagement leading to long-term employment with
Marriott is a critical focus area that can have a significant impact on business outcomes.

CHALLENGES FACED BY THE INDUSTRY

One of the most common challenges faced by the hospitality industry is employee retention. Often, the
perceived glamour of the profession attracts people and compensates for the long work hours and low pay in
this industry. Marriott was quick to realise that this was not a sustainable proposition and sought to address
these concerns through the way it operates, manages and engages its Associates.

Across all its properties, the “Marriott Culture" is driven through serving the Associates, the customer and the
community. The organisation believes that the key element in managing Associates lies in defining simple
values, which can be executed in their day-to-day work. People first — the Core Value of Marriott's corporate
culture is responsible for its success of over 80 years because it recognises that Associates are not only
important to the business but they also give it an edge in a very competitive environment. The organisation-
wide initiatives focus on ensuring that the values translate into practices that can be followed and Associates
across the globe live the defined values.

MARRIOTT'S ASSOCIATE ENGAGEMENT FRAMEWORK

Marriott uses the Hewitt Associates' definition of engagement: 'Engagement is the state of emotional and
intellectual commitment to an organisation or group producing behaviour that will help fulfill an organisation's
promises to customers - and, in so doing, improve business results'. These observable behaviours can be
organised into three categories:

a. Stay – when employees have an intense desire to be a part of and stay with the organization.
b. Say – when employees advocate the organisation by referring potential employees and customers, are positive
with co-workers and are constructive in their criticism; and
c. Strive – when employees exert extra effort and engage in behaviours that contribute to business success.
 To achieve this state of commitment amongst Associates, Marriot has identified five drivers that influence
employee engagement. These are Leadership Excellence, Personal Growth, and Quality of Life at Work,
Teamwork and Total Rewards. Marriott's engagement framework seamlessly connects its engagement drivers
and the organization’s financial performance through Associate engagement and loyalty that translates into
guest satisfaction.

LEADERSHIP EXCELLENCE
At Marriott, Leadership Excellence is about living the core value stated by the Founder J. W. Marriott - “taking
care of your people.” Leaders at Marriott continuously demonstrate and communicate the value to every
Associate through guiding principles like, an open door policy where any Associate can reach out to senior
management with their ideas and suggestions. Although this sounds simple, care is taken to ensure that the
policy is executed by putting in place special channels of communication where Associates can actually contact
and communicate with senior managers. This policy extends beyond just hearing what the Associates have to
say. Leaders take responsibility to respond to the Associates. This communication is also tracked and monitored
to ensure that Associates are informed about the course of action. In an industry where hierarchy is strong, this
practice enables associates to feel valued and important. The practice of addressing General Managers of
properties by their first name also adds to this value.

Leaders constantly coach and mentor Associates at the next level and potential candidates for leadership
positions with a focus on 'growing our own people.' This is another value, which is applied across all properties.
The rapid growth of Marriott has led to a pressing requirement for a pipeline of leaders who understand the
culture and values of the organisation. It is a critical need for Marriott to maintain consistent quality of service
across various properties. Marriott firmly believes that employees who have grown through the organisation
will be able to live the values, effectively sustain growth and add to the organisation's bottom line.

PERSONAL GROWTH
Training programmes for every employee are given a high priority in Marriott. As a policy, every hotel in the
Marriott chain contributes $750 per manager, per year, into a fund, which is controlled by the corporate office.
This is mandatory. Thirty four hundred hotels with approximately 100 managers in each hotel contributing $750
per manager, per year, translate into a phenomenal budget available exclusively for training purposes. Major
training programmes are centrally created and rolled out across the globe. It is ensured that every Associate at
Marriott from the General Manager downwards gets a minimum of two full weeks of training every year. The
core value of “Growing your Own” is lived through this practice. Considering that the industry benchmark for
training of two full weeks every year happens only for around 20-25 percent of employees, this practice is a
strong differentiator in Marriott.

The organisation also deputes teams of employees from one hotel property to another for cross exposure. The
aim is to encourage sharing of expertise and learning from within the organisation. The deputation ranges from
one to ten weeks.

When Marriott came into India, it realised that Associates in India look for growth not only in India but also
globally. Marriott also realised that competitors could not deliver on this need, either because they did not have
a presence around the world or because they simply restricted their focus to growth within the country. At
Marriott, an Associate may move from India to Indonesia, China or anywhere else after a certain time of being
in the organisation. This has had a strong and positive effect on talent attraction for the organisation.

QUALITY OF LIFE AT WORK

When Marriott entered India 12 years ago, the biggest challenge was to provide Associates work life balance in
a profession and industry where to achieve results one has to work 24x7. Marriott was the first in the industry to
mandate a five and a half day workweek in India. This means every other week, Associates are able to take two
days off. When Marriott entered Hong Kong and introduced the practice of a five-day workweek in a country
where the hotel industry traditionally worked for six days a week, the Hotel Association did not approve.
However, Marriott stood its ground as it had done in most countries, including India. Now, most hotels in Hong
Kong have a five-day workweek.

This value of providing its employees with an environment where they are able to experience work life balance
influenced other hotels to follow suit thereby creating a larger impact on the industry.

EMPLOYEE EMPOWERMENT
What works for Marriottis the autonomy given to every Associate to make a decision that affects a customer
directly. Even a front desk, line level Associate has the authority and power to give a free room to a customer
who has experienced major service issues in their interaction with the Marriott group of hotels. This autonomy
to make important decisions lead to immediate action where the customer is attended to at the earliest. Although
employees may make mistakes while taking a decision, they are empowered with the responsibility to think
through the situation consciously and judiciously. This empowerment enables and encourages employee
engagement.

TEAMWORK
Marriott defines success of the organisation by how well it is viewed in the community. It promotes teamwork
by encouraging Associates to engage with the community as core teams. The spirit to serve the community is
demonstrated everyday by associates and the organisation by supporting local, national and global initiatives,
through its CSR programmes. For instance, the Marriott Chennai property is associated with a home for around
180 children, whose parents have been affected by leprosy. The mission is to educate the children and train
them for possible employment with the properties after their school programme. All Hotels also contribute
monetarily to these programmes. The best practice is the belief that CSR engagement as teams, enables
Associates to bond with each other as “community citizens” while working towards a larger goal, which in turn
builds engagement and teamwork. This unique practice is in addition to other popularly used interventions for
team building.

TOTAL REWARDS
The rewards programme at Marriott is structured towards rewarding holistic performance and not just the
achievement of financial targets. This includes guest and Associate satisfaction. The assessment of a manager's
guest satisfaction scores and Associate satisfaction scores carry equal weightage.

Marriott conducts an annual online Associate Opinion Survey across its properties worldwide. The objective of
this survey is to get Associate feedback on the various dimensions that predict Associate Engagement and
thereby improve unit performance. Marriott, along with Hewitt Associates, has designed a new survey to ensure
a high level of consistency, respondent confidentiality, and data security. The survey measures Associate
opinion on the five engagement drivers of Leadership Excellence, Personal Growth, and Quality of Life at
Work, Teamwork, and Total Rewards. The Associate Opinion Scores (AOS) feed into reward practices and
future development plans at a unit or property. Low Associate satisfaction scores for a manager affect the bonus
of the managers and executive members who run the business concerned.

Marriott leverages the reward programmes as a way to ensure that Associates achieve the business standards
and still feel rewarded. It begins with simple things like ensuring that housekeeping Associates who clean
rooms or serve food are able to guarantee that they meet certain minimum standards of cleanliness or food
quality. As part of its reward programme, Marriott has put in place a practice that provides an opportunity for
every Marriott Associate to stay with their family at one of its properties on their birthday or anniversary. The
idea is when Associates actually stay at the hotel with their family they are more critical of what is missing from
a service or cleanliness point of view. These inputs and suggestions are shared with fellow Associates and lead
to an improvement on current standards and service provided at the hotel.

Action Planning: The AOS scores are leveraged at Marriott to continuously improve its engagement practices in
a measurable manner. Every year, after the AOS scores, Rap sessions are conducted at every unit to discuss the
scores based on which “Action Plans” are created and documented, appropriate action is taken and periodically
tracked. If a property has very low AOS scores, a review or Rap session is conducted within six months rather
than on an annual basis for closer monitoring. Progress on the action plans and employee satisfaction is
monitored on an annual basis through improvement on the AOS scores. If this fails, an investigation is
conducted and appropriate action is taken on the management at the property.

SHRM INDIA'S CONCLUSION

The core value of Marriott to take care of its Associates, who will take care of their customers and thereby
impact the business is a concept similar to “Employee First, Customer Second” propounded by Vineet Nayar,
CEO of HCL, in 2010. What makes this different is Marriott has put this in practice from 1927 when J. W.
Marriott and his wife started the Marriott hotels from the humble beginnings of a root beer stand. The success of
the Marriott approach is demonstrated by the employee tenure in the organisation, which ranges between a
minimum of 20 years to a maximum of 51 years. At a time when organisations are struggling to retain their top
talent, especially in an industry known for its high attrition rate, this is quite an achievement.

The values though stated in a simple manner are tough to execute. However, leadership excellence and the
culture of the organisation are demonstrated in the belief in the values and perseverance towards delivering
them. This quality is expressed strongly across all the engagement drivers starting with providing select
channels of communication between the Associates and senior managers; shortening the workweek despite
resistance from the industry; commitment to providing training opportunities for Associates, starting with
making the required budget available every year; and measuring and managing engagement through the
Associate Opinion Survey. Marriott establishes that how they conduct the business is as important as the
business itself. This is not only captured in their core value statement and intent but also put into practice as
demonstrated by their commitment to Associate Engagement.

Based on the analysis of the case, be prepared to discuss the salient aspects of the case.