Five Star, a luxury hotel in Auckland, New Zealand, was established in the early 1980s, renovated in the mid-1990s, and basically had not changed since. Competition was increasing as three more luxury hotels had opened in the area. The owners reacted by trying to upgrade the hotel and improve the customer service. In the hotel sector, customer service is the only differentiator from other hotels.

The owners created a vision statement that included a strategy for achieving their vision:

Five Star is to be recognized as the finest five-star property in Auckland and a business leader in the hospitality industry. We will achieve this vision by recruiting and developing customer-focused employees who provide the highest level of guest service and by providing the highest amenity level of any hotel in Auckland.

By improving customer service, the owners hope to increase customer satisfaction and impact financial performancethe value chain, as demonstrated below:

QUESTION - Design the HRM selection, orientation, training, performance management, and incentive compensation program that will develop these competencies.

MANAGEMENT POLICIES AND PRACTICES IN A QUALITY-FOCUSED HOSPITALITY INDISTRY STR NTEAY