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The failure of ‘control’ in the hospitality industry
Hospitality Management 20 (2001) 353–365
The failure of ‘control’ in the hospitality industry Martin Peacock*,1, Martin Ku. bler Business School, University of North London, Holloway Road, London N7 8DB, UK
Abstract This paper explores the relationship between the literature on the issue of control and the realities of the hospitality industry. Management control is related to the unsanctioned entrepreneurial activities of operatives (illustrated by the ‘taxi scam’), the failure of computer systems used to control operatives, and the failure of the hospitality industry to exploit the potential of the new technology. The paper suggests that management’s (and a significant part of the literature in this area) failure within hospitality is linked to the perception of the role of the hospitality manager as one of policing the industry. r 2001 Elsevier Science Ltd. All rights reserved. Keywords: Control; Domination; Hospitality; Scams; Fiddles; Technology; Systems; Taxis; Customers
Organizations are often used as instruments of domination that further the selfish interests of elites at the expense of others, and there is an element of domination in all organizations. (Morgan, 1997). 1. Introduction The words ‘domination’ and ‘control’ are synonymous. The Oxford English Dictionary uses ‘‘dominate, command; exert control over’’ to describe ‘control’, and ‘‘ascendancy, sway, control’’ as words that describe ‘domination’. Perhaps because of the values perceived in the word ‘domination’ it does not quite have the currency that the term ‘control’ has in the management literature. One search of a management literature database found 14,383 references to ‘control’, but only 520 references to ‘domination’. One person’s ‘control’ maybe another person’s ‘domination’, but not in the management literature. *Corresponding author. E-mail address: [email protected] (M. Peacock). 1 www.martinpeacock.org 0278-4319/01/$ - see front matter r 2001 Elsevier Science Ltd. All rights reserved. PII: S 0 2 7 8 - 4 3 1 9 ( 0 1 ) 0 0 0 2 2 - 6
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Any discussion of ‘controlling hospitality organisations’ needs to address the nuances of the semantics as a way of addressing underlying methodological, ethical, practical and ideological issues around the concept of ‘control’. As control systems are developed for hospitality, they are legitimised in Weberian rational-legal constructs. It is legitimate to ask: what does ‘control’ do, do these control systems work, and if so, who do they work for?
2. Literature Kasavana (1994) claims that ‘‘the new elements of success appear to be controls, controls and controls’’, and the literature has not disputed this. From ‘production control’, through ‘quality control’, ‘total control methodology’ (TCM) to ‘fuzzy control’ (Petrovic-Lazarevic and Wong, 2000), the literature has privileged the language of domination and command. Those policed and controlled are not necessarily just hospitality operatives and managers: they could be the guests themselves. As Guerrier and Adib (2000) note when discussing large hotels: ‘‘so there is a recognition that both guests and staff need to be policed to protect them against each other’’. And yet: ‘‘Control always generates forces of counter-control, and that every success is the basis for a potential downfall’’ (Morgan, 1997). There is a tension with every system of control and that tension produces resistance. Perhaps a particular tension for the modern hospitality industry is the gap that Korczynski et al. (2000) point to in their research on call-centres: the tension between customer orientation on one side and efficiency and rationalisation on the other. The customer wants what the customer wants, and this desire may not be rational, logical, profit-maximising, pleasure-maximising or even legal. On one side you have Guerrier and Adib (2000) suggesting that: ‘‘The reality is that there are some services that are not provided and some customers who cannot or should not be satisfied’’. While on the other side you have a concierge interviewed in the course of this research who claimed that: ‘‘Providing you have the money, we can get it’’. That last quote has a fair claim to be a definition of the hospitality industry. The forces of ‘counter-control’ can take a variety of forms. Guerrier and Adib (2000) point to strategies of ignoring, humour or detachment from operatives in the face of problems from customer desires and management disinterest. However, the focus for their paper is industrial placement students who they note are ‘‘younger and more inexperienced’’ than most hospitality operatives. This paper looks at strategies to deal with the issues of control from experienced hospitality operatives. The operatives in this paper are addressing both the issue of formal managerial control and the desires of consumers. It is difficult to separate any discussion of control and technology in the modern hospitality industry. Even the potential mismatch between real customer behaviour and managerial systems, can be seen in the sphere of technology. Van Hoof and Combrink (1998) discussing the internet, found that half of surveyed US hospitality managers complained that the customers use of the technology was ‘unpredictable’.
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Managers are having trouble adjusting the behaviour of the customers to their technological systems. Technology has often been used as an instrument of control and the term itself has a link with the use of tools to control inanimate objects. Possibly, the best illustration of the use of technology to control people is Zuboff’s (1988) example of Bentham’s Panopticon. Here a prison is designed with glass walls and corridors radiating out like spokes from a wheel. The concept is that these corridors can be controlled by one guard situated at the centre of the wheel. The technology (in this case glass walls, a rotating chair and innovative design) is used to control the inmates. This is not an image totally distant from modern information systems within hospitality. There is an aspect of modern computing that emphasises the collection and dissemination of data, even when it is at odds with the personal experiences of operatives, managers and even researchers. After all: ‘‘Brabbage’s idea for a programmable computing machine arose within a society that was entering upon an obsessive affair with data’’ (Beardon, 1994). Lyotard (1984) argues that the computer is closely allied to positivist thinking and promotes only the formal scientific aspects of knowledge. Using the computer and its data manipulation as a source of control appears to be a key issue for the tourism and hospitality industries. Ritzer identifies the ‘Fordism’ of technological applications, as they are used to improve ‘efficiency’, ‘calculability’, ‘predictability’ and ‘control’. ‘‘Thus over the long term we have seen a shift away from control by people and toward control by technologies’’ (Ritzer, 1993). He illustrates these themes with an exploration of how McDonald’s operates. Collins and Bicknell (1997) suggest that computers’ potential effectiveness is exaggerated because of the popular belief that computers are synonymous with efficiency. Modern information systems privilege a vision of technology which has close links with Bentham’s glass prison. In the NEDC working party report on competitiveness in tourism (1992), TGI Friday’s use of technology to provide ‘‘control and monitoring systems’’, is listed under Case Studies Best Practices. The same report also praises McDonald’s use of systems. Baker et al. (1998) suggested that the EPOS system developed for Bass Taverns removed the ‘uncertainties’ of operative fraud and the ‘black economy’ for public house managers. However, there is a growing literature that suggests that information technology is not the effective tool of control that has been painted above. Collins and Bicknell (1997) suggest that computers’ potential effectiveness is exaggerated because of the popular belief that computers are synonymous with efficiency. Thompson (1998) noted that 90% of businesses that had experienced computer-related incidents had been the victims of staff in their own organisation. This paper is part of a growing tendency to question the relationship between managerial attempts to ‘control’ and industry realities.
3. Methodology This paper is based on the work of researchers employed at a number of hotels, bars and restaurants in the central London area. Students on industrial placements
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were not used, only trained researchers as the importance of contemporaneous notes was crucial. The researchers were employed for a number of months in each selected hotel. This enabled relationships of trust to be built up with key informants. Both Guerrier and Adib (2000) and Gabriel (1999) have discussed the problem of the ‘invisibility’ of resistance and this method was designed to overcome that issue. Conventional questionnaire-based approaches were inappropriate for exploring the complexity of relationships and attitudes that colour and shape the hospitality experience. Instead, observation and unstructured interview has been used as source data. One focus of this research was the divergence between the information generated by the technological system and reality. Areas studied included cash handling procedures, payment fraud, system manipulation (specifically in relation to performance targets), unit management financial fraud and the degree of tolerance for fraud. Different perspectives (‘dual culture’Finterviewed manager) on system data were critically examined and related to external factors, such as labour shortages. Essentially, the ‘‘methodology and findings are contextualised as the ethnography embraces the fieldwork in which the data was gathered’’ (Lugosi, 2001). Ethnography, where ‘‘the researcher tries to immerse himself or herself in a setting and to become part of the group under study’’ (Easterby-Smith et al., 1991) can be a controversial research technique in hospitality. In part this is connected to the discussion of what are often considered to be the unacceptable facets of the industry. Both operatives and managers in the cases researched have an interest in keeping the realities of the situation hidden. What is clear from the data collected below is that ethnography has a validity that the more customary methods of the survey and the formal management interview lacks. Managers present a partial picture of their experiences in interview and survey. The more sensitive the issue, the more partial the picture. Direct observation has a force that the partial representation of observation gained during surveying or interviewing often lacks. On the ethical question of the essentially deceitful nature of covert interviews, the lack of informed consent used in some of these interviews must be contrasted with the fullness of the picture presented, especially when contrasted with the results achieved by different methods. The identities of the hotels and respondents have been concealed as it would be unacceptable for the observed to be damaged by the research process in any way.
4. The taxi ‘scam’ As a tool for exploring attitudes to control and to enable the paper to explore methodologies of investigation, the following data is submitted. It is an interesting illustration because it points to a contrast between the hospitality management ideology of ‘control’ and industry realities. This contrast is replicated with the choice of research methods. Putting it succinctly its an industry truth, which is only revealed with ethnography.
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One key service provided by hotels is the supply of taxis. While taxis can be seen as a legitimate service, our data suggests that the way in which they are supplied within London hotels put them in the ‘illicit’ category. In essence, the business is so large and lucrative that it operates on a commission basis. Hotel employees use certain taxis and in return are paid a proportion of the fare (in cash). The ‘scam’ is common and widely known, but has received little attention in the academic literature. A guest request for a taxi is not a simple matter. Approached by a guest requesting a taxi, the porter or concierge immediately needs to make a number of important decisions: ‘‘First, you look at them and try to find out where they are from and how well they know London. Are they travelling on business or are they tourists. Are they British, maybe even from London, or foreign? Where are they going to? What time do they want to go? How many people are going? These are all things you need to think about, before even reaching for the telephone’’ (interviewed concierge). The operative involved in this scam has to make a very individual appreciation of the customer. It is a delicately balanced judgement based on experience. Officially, porters and concierges are only allowed to order licensed Black Cabs for hotel guests, but there are problems with these: ‘‘Black Cab drivers suck. You call them and they never turn up. Or they turn up, but don’t let you or the guests know that they’re waiting outside and end up taking somebody else instead. Sometimes you have to argue with them to go to particular places or areas and on a busy Friday or Saturday nights after 2.00 am it’s practically impossible to get one or they take forever to arrive.’’ The porters and concierges therefore favour minicabs, but as the interviewed concierge noted: ‘‘You have to be careful, whom you book a minicab for. For example, never book a minicab for somebody from London or somebody who knows the city well, because they will realise that the minicabs we use aren’t much cheaper than Black Cabs and will get suspicious.’’ Suspicious, that is, that part of the money the guest pays the minicab driver makes its way back to the porter or concierge as commission payments, which is exactly what happens and the main reason porters and concierges like using minicabs. ‘Aren’t much cheaper’ is quite an understatement, as the minicab companies charge considerably more for many fares than Black Cabs to cover the commission payments. For the trip from one researched hotel to Waterloo, minicab companies charge up to d15, whereas the same trip in a Black Cab would not come to more than d11. A local fare pays d2 commission, guests going further outside the centre are worth about d5–d6 and a fare to one of the airports can easily net a commission of d10–d20. Busy days earn a concierge or porter d40–d50 in commission payments and even an average day rarely sees them walk out with less than d20. Most receptionists do not know about this sideline and new-starters are told during their training to ‘‘leave taxi and theatre bookings to the concierges and the porters’’. Advice that appears to make good sense, because reception is generally notoriously under-staffed and busy, receptionists often just about manage to cope with their ‘core’ duties. The few, mostly senior, receptionists who do know about the ‘scam’, seem to quietly tolerate it as being part of the considerable informal rewards culture of the hotel.
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In one hotel it was observed that the front office manager knew about it too, but hardly ever intervened. She was only observed intervening when guests complained about the type of taxi booked by the concierges or the price of the fare. She then pretended to be very concerned, but afterwards only made lackadaisical attempts to stop it happening again. Faced with such a lacklustre telling-off by the front office manager, the concierge’s reaction is either to point out the low wages they and their porters are working for or say something along the lines of ‘‘Oh, that’s your free tickets gone then’’. The latter refers to the fact that the concierges frequently supply the front office manager, as well as other managers, with free tickets for exhibitions, plays, concerts and similar events. Senior managers and employees, outside the life-world of the front office, appear to know little about the activities of the concierges and porters. According to one informant: ‘‘Once, [the General Manager of hotel] accidentally got wind of it, because some American guests wrote a letter to him, complaining about the high price charged by a minicab driver we called for them. He made quite a fuss about it, but neither his meeting with the head concierge and the front office manager nor the official memorandum to all front office staff had lasting effects. We’re a bit more careful now, like we don’t book minicabs anymore when managers or staff from other departments stand around at reception and we spoke to the cab companies, so their drivers hand the money over as discreetly as possible, preferably in envelopes.’’ Deciding which cab to order for guests asking for a taxi is not the end of the story, however. If the concierge or porter has decided to book a minicab, the guests have to be kept in the hotel lobby until the driver arrives, lest they should wander outside and be picked up by a Black Cab instead. In which case the concierge or porter not only loses the commission money but also faces upsetting the minicab driver and the minicab company. Having just lost several guests to a Black Cab drivers one night, one informant put it this way: ‘‘Things like that are annoying. I lost d21 tonight, just because they [the guests] wouldn’t stay put and I couldn’t keep an eye on them while they were waiting. As if that wasn’t bad enough, I also got a call from the minicab company and had to listen to the controller winging about lost business and lost time. I don’t want to ruin our relationship with that company, they’re very good, always quick to respond, reliable payers.’’ Later that night, the manager of the minicab company came around to the hotel, ‘‘Just passing by on the way home’’, as he said. ‘‘What happened tonight?’’ he asked the informant. ‘‘You’re not normally that unreliable, right? We’ve lost a lot of money tonight because of you, you know. Believe me, we’d like to provide the best possible service at all times, but if it carries on like that, you might have to wait a little longer for your cabs in the future. Anyway, probably just an unlucky night, hey?’’ The concierges’ and porters’ standard reply to guests for whom they just booked a minicab is, as observed: ‘‘Sir/Madam, your taxi will be here shortly. The driver will come inside to pick you up. Why don’t you have a seat in the bar area or in our group check-in area while you’re waiting?’’ The latter is increasingly important during the night, because neither the bar nor the group check-in area can be seen from outside the hotel, stopping Black Cab drivers walking into the lobby and
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approaching the guests directly. They might do this if they see guests waiting in the empty lobby laden with luggage. Another trick is to quickly grab hold of the guests’ luggage loading it onto the luggage trolley behind the desk in order to wheel it to the cab as soon as it arrives. This is always done in a friendly manner and guests probably never suspect the concierges’ and porters’ real intention, namely to make it harder for them to leave the hotel before the booked cab arrives. Sometimes, guests refuse to take a seat and instead wander around the lobby. As soon as they come too close to the doors, the concierge or porter will flash an apologetic grin and say something along the lines of: ‘‘Sir/Madam, please don’t just take any cab that pulls up outside. I have booked a cab especially for you and the drivers always get rather upset when they arrive and the guests have gone.’’ When the minicab driver arrives, he or she will normally first greet the guests and point out the car to them, then casually stroll over to the desk and greet the porter or concierge who booked the cab. A quick hand-shake transfers the commission and the driver returns to the car and the waiting guests. Sometimes, the guests already stand close to the hotel doors with their luggage ready to board the cab, giving the driver little excuse to walk up to the desk. The concierge or porter will then quickly leave the desk, hurry towards the guests and pretend to help with the luggage or hold the doors open, thus getting close enough to the driver to transfer the commission. Occasionally, Black Cab drivers waiting outside the hotel get upset when they see guests getting into minicabs, especially when they suspect a very lucrative fare, e.g. to Heathrow or Gatwick. In the past, some of them even got out of their cabs and started shouting abusive and threatening remarks at the drivers, guests and the concierge or porter. One informant remarked: ‘‘Sometimes, it got pretty bad. They [Black Cab drivers] would shout and jump and upset everybody around. Guests would get confused when the drivers kept going on about minicabs not being licensed. American guests in particular would get hesitant, thinking that I called one of those rogue minicab drivers their guidebooks are always warning them off using. There wasn’t much we could do, apart from try and get the guests into the minicab as quickly as possible, before one of the Black Cab drivers lost it.’’ Realising that the problem is particularly bad in the early mornings and late evenings when the lobby and the road outside the hotel are empty, one of the interviewed night porters came up with an entirely different solution, which turned out to kill two birds with one stone. ‘‘I mentioned it to a friend who works in the [another hotel in the same chain] and who used to have similar problems with Black Cab drivers, until he came across a chap who drives a licensed Black Cab but tops up his earnings by doing un-metered airport transfers. You can call him anytime, day and night, on his mobile phone, provided you’ve got an airport fare. It’s a bunch of drivers, actually, but he’s the boss. They’re very reliable and quick. They pay the normal commission, but without the minicab hassle, obviously.’’ ‘‘Please note that our staff can only order licensed taxis for guests, they are not permitted to order minicabs’’ says the notice in one of the hotels where the porters and concierges do precisely the opposite. Here the hotel employees act as the gatekeepers between the guest and their taxi journey. This is an opportunity for the entrepreneurial activity of the hotel employees, while paying lip service to the needs
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of the customers (the unreliability of the Black Cabs quoted above), and bypassing the existing power structures within the hotel. An illusion of control is provided. The hotel management receives an efficient guest service (usually), a subsidy for the wages of key staff and occasionally ‘gift’-based rewards from the entrepreneurs organising the ‘scam’. It owes nothing to ‘control’ and everything to ‘negotiation’. As Ritzer (1993) notes: ‘‘humanity is essentially creative and if you develop systems that are constraining and controlling people, the can’t be creative, they can’t be human.’’ Wood (1992) makes the point (when discussing ‘deviance’ and the hospitality industry), that individualistic explanations of ‘non-legitimate’ operative behaviour based on the psychological characteristics of employees ignore social and economic realities. The taxi ‘scam’ is not deviant behaviour: it is ‘normal’ behaviour for the industry. Outside of family owned and managed hotels (where slightly different systems of control seem to operate) we have not found one hotel where this ‘scam’ is not at least an occasional feature. At a speculative level it is possible that the refusal of senior management to acknowledge this activity (either through ignorance or dishonesty) runs parallel to the inadequacies of the more conventional hospitality research tools. Test interview and questionnaire of senior management of hotels where the ‘scam’ was observed revealed nothing about an activity that is worth millions of pounds in the UK alone. An emphasis on quantifiable measures (both in methodologies and management) ignores (possibly deliberately ignores) industry realities. As Morgan (1997) comments: we should always be asking the question ‘‘rational for whom?’’
5. The delivering company It could be argued that the supply of taxis is peripheral to the core business of our hotels, but the next example focuses on the issue of control and the core business, while exploring the interaction with new technology. This is a unit for a company specialising in delivering highly perishable cooked foods to homes and hotels in the central London area. This was a company which has recently completed a huge investment in information technology, including a sophisticated computer telephony integration (CTI). Customers rang a central number with their order. If the number was recognised it was transferred to the local outlet and customer details (e.g. delivery address) appeared with the call. The company (a market leader) put considerable faith in its sophisticated information systems. The company has a bonus system for managers which is tied into two main measures of performance: sales and efficiency. Efficiency is defined as the percentage of consumers who receive their order within 30 min (called the ‘under 30s’, in the company colloquialism). Managers perceive the sales figures as outside their control, so they tend to emphasise the ‘efficiency’ figures: ‘‘who gives a damn about sales as long as my service [‘under 30s’] is above 95% each dayFso what!!’’ (interviewed manager). The ‘efficiency’ figure is manipulated at the point of order. If the operative left the order on the screen (without pressing the button to have the order transmitted to the
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kitchen) then the beginning of the 30 min count could be delayed. Orders could still be taken on other lines. Head office countered this manipulation by recording how long the orders were kept on screen. This device is now being countered by pressing the ‘edit’ button for the order. This means that the order is not on screen, the clock is not running, but the kitchen is processing the order as the order has been passed verbally. The second method of manipulating the time of the order is to put through the order as if it is required in the future. Successful manipulation of the information system to maximise bonus needs skilful professional practice. After all, ‘‘people bad at their legitimate jobs, are unlikely to be any better at coping with fiddling’’ (Mars, 1994). An example of the manipulation failing is the customer who received their product before the order had technically been placed by the system. Bonuses are regulated by the successful use of this manipulation. Apart from using bonuses in an attempt to influence employee behaviour the company also uses technology to make employee behaviour more predictable. Modern information systems often come complete with a ‘scripting’ of operatives to make sure that predictability is maintained: modern property management systems can remind the receptionist whether it is ‘good morning’ or ‘good evening’. This company, with its eight step telephone guide, is no exception. Unfortunately, the rigidity of the system creates its own problems, apart from operative fatigue. There are now websites available detailing questions that customers can use to disrupt the script, but simply an enquiry followed by an order will create sufficient problems. One area where information systems were expected to cut back on fraud was the move away from cash to cards. Observation would tend to suggest that this is not the case. Firstly, phone card checks can enable the criminal consumer to check if his or her stolen credit card is still usable. Secondly, even with an authorisation check the volume of business subsequently found to be through stolen credit cards was thousands of pounds a year. Tolerance for use of these cards seemed surprisingly high, even when their users were known to staff at the unit. Pressure of business led to these losses being written off. One manager said that prosecuting known offenders might have the effect of publicising the ease of the crime. The high proportion of stolen credit card business could be down to the consumer offering a different card to the one mentioned (and authorised) on the phone. However, a significant proportion was internal fraud. One unit manager (not in the surveyed unit) was recently dismissed after hidden video cameras caught him replacing cash orders with stolen credit card ones (and pocketing the cash). The amounts here were highly significant and it seems likely that a general level of this type of fraud is endemic. It was observed that stolen card numbers were used to place bogus orders, which then subsequently became staff food. Normal staff meals can impact on performance bonuses but stolen credit card orders, subsequently eaten as staff food, do not. Computer fraud can be seen as part of a struggle for control between the centre and local units. One duty manager specifically related her manipulation of the bonus system to the head office’s recent decision to stop funding taxis home for managers working beyond one in the morning. She was confident that increasing technological
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monitoring (including video surveillance) could be matched by increasing sophistication on the part of local unit personnel. In part, head office tolerance for widespread (and often obvious) manipulation of the systems, was the product of problems recruiting and retaining staff. As their ‘Operational Effectiveness Survey’ (a difficult to obtain document) noted: ‘‘We do not feel that we retain the right people needed to maintain long term success.’’ Those committing fraud were often the most skilful and hardworking employees (particularly duty managers), which the company needed. With a limited loyalty and low morale from local managers, senior management need care to retain key staff. Unit managers believed that fraud was often known about and accepted (within limits) by area managers, but not known about and accepted by head office. Line managers saw head office as out of touch in more ways than one. Head office’s technological solution to communication problems (a highly sophisticated voicemail system) was universally derided. Frequently, researchers were provided with the story of the head office ice cream promotion, where considerable quantity of ice cream was supplied to local units, but no additional freezer space. Interestingly, head office has become increasingly committed to a language of empowerment and local control, at the same time as its information systems have moved further away from these principles. Head office was renamed ‘Restaurant Support Centre’ and the management structure was made flatter. Considerable effort was put into obtaining the views of local managers. What is interesting is how this contrasts with a local management perspective which sees itself as (in one manager’s words) ‘‘cogs in a wheel’’. They would dispute the Restaurant Support Centre’s view that it is empowering the local units, as the question of ‘‘who gains remains largely mute’’ (Burdett, 1999). If unit managers experience a declining work experience, then changes of terminology, or delayering have less impact than an automating information system.
6. The sustenance company The next focus for the paper is a public house within a large brewery chain. It is situated in a large central London Square and has recently completed a major programme of refurbishment costing hundreds of thousands of pounds. ‘State of the art!’ (interviewed manager) information systems were installed, costing tens of thousands of pounds. The establishment was selected partly to build on the work of Baker et al. (1998) in their study of EPOS systems in public houses, but also because its high proportion of tourist business is unusual, even for Central London. Like the company in the case study above, the brewery also believed that it was ‘‘flattening the organisation, empowering the staff and providing significantly enhanced communication ability’’. In the first month of trading in its newly refurbished format the public house ‘lost’ d30,000. There is an acceptance that public houses are closely involved with processes of ‘fiddling’, as Mars (1994) noted ‘‘drink is often used as the medium of exchange in personal dealings’’ and this has traditionally meant that there is an
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association between public houses and ‘fiddling’. What was unusual about this case was the shear scale of the theft, combined with the sophistication of the system designed to stop it occurring. Managers watched video footage, patched through directly to their computers in the offices downstairs, mystery customers from the company visited every day and spreadsheets were pored over with increasing anxiety. Apart from the information that the losses tended to be concentrated on those areas where the mathematics were simpler (when the pint cost d2.50, for example), the cause of the problem was impossible to determine. At the end of the first months trading, when the ‘fiddling’ had cost almost as much as the systems designed to control it, the problem simply disappeared and fiddling dropped to an ‘acceptable’ (interviewed manager) level of d1000 a month. There were a large number of (voluntary) staff changes, which have been linked to the improved figures, but the method and detail of the fiddle has still escaped management detection. What makes the evasion of detection even more impressive was the depth of information which the system was able to provide. Detailed performance statistics could be provided on each member of staff and this could be related, for example, to the current promotions which the brewery was operating. Operatives found this system alienating and they also objected to name badges and the ability of the EPOS system to display the names of the operative. The ability for customers to use the first names of serving staff was found to be intrusive by most operatives. Operatives also felt that on occasion managers were ‘hiding behind’ their computer screens and avoiding more difficult confrontations with customers. The sophistication of the new system took managers away from their more traditional ‘front-line’ role and shifted them towards a ‘back-office’ one. One experienced operative commented with resentment what she felt was an increasing trend for managers not to serve customers themselves, especially if there were problems. Interestingly this ‘‘conspicuous absence of management at a most critical time’’ Guerrier and Adib (2001) is increasingly common. Korczynski et al. (2000) point to how management’s disembodied concept of the customer is linked to the growth of formal control systems. In the Baker et al. (1998) paper, jointly written with the brewery head office, the studied installation is claimed to ‘belong to the 10–20% of successful IT projects’. When the brewery for the studied public house above, was contacted for its comments on the installation of the information system, it described it as a ‘complete success’. In both cases, possible reasons for this claim were missing. It is possible that the advanced EPOS system improved the speed of service, though operatives claimed that additional keying slowed down service. It is possible that detailed examination of consumer behaviour enabled breweries to restructure prices more profitably, though again operatives felt that it was the drinks that were most sensitive to prices changes, which were increased the most. It is possible that managers were empowered by the additional information available to them, but no data was found to support this. In the minds of brewery managers, one of the key motivators behind the development of their information system was the control and prevention of operative
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‘fiddles’. In the case above this intention clearly failed. It is possible that the sophisticated system was used to facilitate the scale of the theft, but, at the least, it did not deter the theft, hinder it or discover the method. A system designed to impose control through increased predictability and transparency of the actions of operatives had precisely the opposite effectFand at great expense.
7. Implications Where there is power, there is resistance (Foucault, 1979, p. 95). Resistance to formal systems of control is not ‘invisible’. Invisibility is simply the function of the choice of research methods. Resistance is the currency of the daily lives of operatives and managers. The first example of the taxi ‘scam’ explores how operatives can respond and handle individual needs of consumers in a way that formal systems of control cannot. The scale of this particular activity is large, but it is only one of a whole myriad of ‘businesses within businesses’ that can be found within the hospitality industry. The second example of the delivering company shows how resistance can be found at the level of management. Junior managers manipulate a technologically sophisticated system to maximise their income. Sophisticated measures of control imposed by head office are matched with sophisticated measures of resistance. The final example is simple theft, possibly by operatives, possibly by managers, possibly by a combination of the two. Losses were so great that in one month they amounted to greater than the cost of the ‘state of the art’ system designed to prevent these occurrences. Classical management theorists such as H. Fayol, F. Mooney and L. Urwick built up a respectable pedigree for the idea that ‘top-down’ control was key part of management. Taylor’s first principle was the shift of control of the organisation of work from the worker to the manager. Yet in this industry characterised with minuscule levels of union activity and generally low levels of individual operative power, what is often put forward is an illusion of management ‘control’. It is as if there is a gap between the ideology and semantics of the ‘controllers’ and the realities of the workplace. The language of ‘control’ still dominates the actions and words of hospitality management. Yet as seen above, power in the workplace has a complex, negotiated quality, which does not fit well with the language of ‘control’. Every attempt at control carries with it, its own contradictory force.
References Baker, M., Wild, M., Sussman, S., 1998. Introducing EPOS in Bass Taverns. International Journal of Contemporary Hospitality Management 10 (1), 16–23. Beardon, C., 1994. Computers, postmodernism and the culture of the artificial. AI and Society 8, 1–16. Burdett, J., 1999. Leadership in change and the wisdom of a gentleman. Participation and Empowerment: An International Journal 7 (1), 5–14.
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Collins, A., Bicknell, D., 1997. Crash: Ten Easy Ways to Avoid Computer Disaster. Simon & Schuster, London. Easterby-Smith, M., Thorpe, R., Lowe, A., 1991. Management Research: An Introduction. Sage, London. Gabriel, Y., 1999. Beyond happy families: a critical re-evaluation of the control-resistance-identity triangle. Human Relations 52 (2), 179–202. Guerrier, Y., Adib, A., 2000. No, we don’t provide that service. Work, Employment and Society 14 (4), 689–705. Kasavana, M., 1994. Computers and multiunit food service operators. Cornell HRA Quarterly 35 (3), 72–80. Korczynski, M., Shire, K., Frenkel, S., Tam, M., 2000. Service work in consumer capitalism: customers, control and contradictions. Work, Employment and Society 14 (4), 669–687. Foucault, M., 1979. La Volont!e de Savoir (1976). In: Gallimard (translated by Hurley, R.) The Will to Knowledge: The History of Sexuality, Vol. 1. Allen Lane Penguin Press, London. Lugosi, P., 2001. A New Research Agenda, Refereed Conference Paper for the April CHME Research Conference. Lyotard, J., 1984. The Postmodern Condition. Manchester University Press, Manchester. Mars, G., 1994. Cheats at Work (revised edition). Dartmouth, Aldershot. Morgan, G., 1997. Images of Organization. Sage, London. Petrovic-Lazarevic, S., Wong, A., 2000. Fuzzy control model in the hospitality industry. International Journal of Agile Management Systems 2 (2), 156–163. Ritzer, G., 1993. The McDonaldization of Society. Pine Forge Press, California. Thompson, D., 1998. Computer crime and security survey. Information Management and Computer Security 6 (2), 78–101. Van Hoof, H., Combrink, T., 1998. US lodging managers and the Internet. Cornell Hotel and Restaurant Administration Quarterly 39 (2), 46–55. Wood, R., 1992. Working in Hotels and Catering. Routledge, London. Zuboff, S., 1988. In the Age of the Smart Machine: The Future of Work and Power. Heinemann, Oxford.
The failure of ‘control’ in the hospitality industry Martin Peacock*,1, Martin Ku. bler Business School, University of North London, Holloway Road, London N7 8DB, UK
Abstract This paper explores the relationship between the literature on the issue of control and the realities of the hospitality industry. Management control is related to the unsanctioned entrepreneurial activities of operatives (illustrated by the ‘taxi scam’), the failure of computer systems used to control operatives, and the failure of the hospitality industry to exploit the potential of the new technology. The paper suggests that management’s (and a significant part of the literature in this area) failure within hospitality is linked to the perception of the role of the hospitality manager as one of policing the industry. r 2001 Elsevier Science Ltd. All rights reserved. Keywords: Control; Domination; Hospitality; Scams; Fiddles; Technology; Systems; Taxis; Customers
Organizations are often used as instruments of domination that further the selfish interests of elites at the expense of others, and there is an element of domination in all organizations. (Morgan, 1997). 1. Introduction The words ‘domination’ and ‘control’ are synonymous. The Oxford English Dictionary uses ‘‘dominate, command; exert control over’’ to describe ‘control’, and ‘‘ascendancy, sway, control’’ as words that describe ‘domination’. Perhaps because of the values perceived in the word ‘domination’ it does not quite have the currency that the term ‘control’ has in the management literature. One search of a management literature database found 14,383 references to ‘control’, but only 520 references to ‘domination’. One person’s ‘control’ maybe another person’s ‘domination’, but not in the management literature. *Corresponding author. E-mail address: [email protected] (M. Peacock). 1 www.martinpeacock.org 0278-4319/01/$ - see front matter r 2001 Elsevier Science Ltd. All rights reserved. PII: S 0 2 7 8 - 4 3 1 9 ( 0 1 ) 0 0 0 2 2 - 6
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Any discussion of ‘controlling hospitality organisations’ needs to address the nuances of the semantics as a way of addressing underlying methodological, ethical, practical and ideological issues around the concept of ‘control’. As control systems are developed for hospitality, they are legitimised in Weberian rational-legal constructs. It is legitimate to ask: what does ‘control’ do, do these control systems work, and if so, who do they work for?
2. Literature Kasavana (1994) claims that ‘‘the new elements of success appear to be controls, controls and controls’’, and the literature has not disputed this. From ‘production control’, through ‘quality control’, ‘total control methodology’ (TCM) to ‘fuzzy control’ (Petrovic-Lazarevic and Wong, 2000), the literature has privileged the language of domination and command. Those policed and controlled are not necessarily just hospitality operatives and managers: they could be the guests themselves. As Guerrier and Adib (2000) note when discussing large hotels: ‘‘so there is a recognition that both guests and staff need to be policed to protect them against each other’’. And yet: ‘‘Control always generates forces of counter-control, and that every success is the basis for a potential downfall’’ (Morgan, 1997). There is a tension with every system of control and that tension produces resistance. Perhaps a particular tension for the modern hospitality industry is the gap that Korczynski et al. (2000) point to in their research on call-centres: the tension between customer orientation on one side and efficiency and rationalisation on the other. The customer wants what the customer wants, and this desire may not be rational, logical, profit-maximising, pleasure-maximising or even legal. On one side you have Guerrier and Adib (2000) suggesting that: ‘‘The reality is that there are some services that are not provided and some customers who cannot or should not be satisfied’’. While on the other side you have a concierge interviewed in the course of this research who claimed that: ‘‘Providing you have the money, we can get it’’. That last quote has a fair claim to be a definition of the hospitality industry. The forces of ‘counter-control’ can take a variety of forms. Guerrier and Adib (2000) point to strategies of ignoring, humour or detachment from operatives in the face of problems from customer desires and management disinterest. However, the focus for their paper is industrial placement students who they note are ‘‘younger and more inexperienced’’ than most hospitality operatives. This paper looks at strategies to deal with the issues of control from experienced hospitality operatives. The operatives in this paper are addressing both the issue of formal managerial control and the desires of consumers. It is difficult to separate any discussion of control and technology in the modern hospitality industry. Even the potential mismatch between real customer behaviour and managerial systems, can be seen in the sphere of technology. Van Hoof and Combrink (1998) discussing the internet, found that half of surveyed US hospitality managers complained that the customers use of the technology was ‘unpredictable’.
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Managers are having trouble adjusting the behaviour of the customers to their technological systems. Technology has often been used as an instrument of control and the term itself has a link with the use of tools to control inanimate objects. Possibly, the best illustration of the use of technology to control people is Zuboff’s (1988) example of Bentham’s Panopticon. Here a prison is designed with glass walls and corridors radiating out like spokes from a wheel. The concept is that these corridors can be controlled by one guard situated at the centre of the wheel. The technology (in this case glass walls, a rotating chair and innovative design) is used to control the inmates. This is not an image totally distant from modern information systems within hospitality. There is an aspect of modern computing that emphasises the collection and dissemination of data, even when it is at odds with the personal experiences of operatives, managers and even researchers. After all: ‘‘Brabbage’s idea for a programmable computing machine arose within a society that was entering upon an obsessive affair with data’’ (Beardon, 1994). Lyotard (1984) argues that the computer is closely allied to positivist thinking and promotes only the formal scientific aspects of knowledge. Using the computer and its data manipulation as a source of control appears to be a key issue for the tourism and hospitality industries. Ritzer identifies the ‘Fordism’ of technological applications, as they are used to improve ‘efficiency’, ‘calculability’, ‘predictability’ and ‘control’. ‘‘Thus over the long term we have seen a shift away from control by people and toward control by technologies’’ (Ritzer, 1993). He illustrates these themes with an exploration of how McDonald’s operates. Collins and Bicknell (1997) suggest that computers’ potential effectiveness is exaggerated because of the popular belief that computers are synonymous with efficiency. Modern information systems privilege a vision of technology which has close links with Bentham’s glass prison. In the NEDC working party report on competitiveness in tourism (1992), TGI Friday’s use of technology to provide ‘‘control and monitoring systems’’, is listed under Case Studies Best Practices. The same report also praises McDonald’s use of systems. Baker et al. (1998) suggested that the EPOS system developed for Bass Taverns removed the ‘uncertainties’ of operative fraud and the ‘black economy’ for public house managers. However, there is a growing literature that suggests that information technology is not the effective tool of control that has been painted above. Collins and Bicknell (1997) suggest that computers’ potential effectiveness is exaggerated because of the popular belief that computers are synonymous with efficiency. Thompson (1998) noted that 90% of businesses that had experienced computer-related incidents had been the victims of staff in their own organisation. This paper is part of a growing tendency to question the relationship between managerial attempts to ‘control’ and industry realities.
3. Methodology This paper is based on the work of researchers employed at a number of hotels, bars and restaurants in the central London area. Students on industrial placements
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were not used, only trained researchers as the importance of contemporaneous notes was crucial. The researchers were employed for a number of months in each selected hotel. This enabled relationships of trust to be built up with key informants. Both Guerrier and Adib (2000) and Gabriel (1999) have discussed the problem of the ‘invisibility’ of resistance and this method was designed to overcome that issue. Conventional questionnaire-based approaches were inappropriate for exploring the complexity of relationships and attitudes that colour and shape the hospitality experience. Instead, observation and unstructured interview has been used as source data. One focus of this research was the divergence between the information generated by the technological system and reality. Areas studied included cash handling procedures, payment fraud, system manipulation (specifically in relation to performance targets), unit management financial fraud and the degree of tolerance for fraud. Different perspectives (‘dual culture’Finterviewed manager) on system data were critically examined and related to external factors, such as labour shortages. Essentially, the ‘‘methodology and findings are contextualised as the ethnography embraces the fieldwork in which the data was gathered’’ (Lugosi, 2001). Ethnography, where ‘‘the researcher tries to immerse himself or herself in a setting and to become part of the group under study’’ (Easterby-Smith et al., 1991) can be a controversial research technique in hospitality. In part this is connected to the discussion of what are often considered to be the unacceptable facets of the industry. Both operatives and managers in the cases researched have an interest in keeping the realities of the situation hidden. What is clear from the data collected below is that ethnography has a validity that the more customary methods of the survey and the formal management interview lacks. Managers present a partial picture of their experiences in interview and survey. The more sensitive the issue, the more partial the picture. Direct observation has a force that the partial representation of observation gained during surveying or interviewing often lacks. On the ethical question of the essentially deceitful nature of covert interviews, the lack of informed consent used in some of these interviews must be contrasted with the fullness of the picture presented, especially when contrasted with the results achieved by different methods. The identities of the hotels and respondents have been concealed as it would be unacceptable for the observed to be damaged by the research process in any way.
4. The taxi ‘scam’ As a tool for exploring attitudes to control and to enable the paper to explore methodologies of investigation, the following data is submitted. It is an interesting illustration because it points to a contrast between the hospitality management ideology of ‘control’ and industry realities. This contrast is replicated with the choice of research methods. Putting it succinctly its an industry truth, which is only revealed with ethnography.
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One key service provided by hotels is the supply of taxis. While taxis can be seen as a legitimate service, our data suggests that the way in which they are supplied within London hotels put them in the ‘illicit’ category. In essence, the business is so large and lucrative that it operates on a commission basis. Hotel employees use certain taxis and in return are paid a proportion of the fare (in cash). The ‘scam’ is common and widely known, but has received little attention in the academic literature. A guest request for a taxi is not a simple matter. Approached by a guest requesting a taxi, the porter or concierge immediately needs to make a number of important decisions: ‘‘First, you look at them and try to find out where they are from and how well they know London. Are they travelling on business or are they tourists. Are they British, maybe even from London, or foreign? Where are they going to? What time do they want to go? How many people are going? These are all things you need to think about, before even reaching for the telephone’’ (interviewed concierge). The operative involved in this scam has to make a very individual appreciation of the customer. It is a delicately balanced judgement based on experience. Officially, porters and concierges are only allowed to order licensed Black Cabs for hotel guests, but there are problems with these: ‘‘Black Cab drivers suck. You call them and they never turn up. Or they turn up, but don’t let you or the guests know that they’re waiting outside and end up taking somebody else instead. Sometimes you have to argue with them to go to particular places or areas and on a busy Friday or Saturday nights after 2.00 am it’s practically impossible to get one or they take forever to arrive.’’ The porters and concierges therefore favour minicabs, but as the interviewed concierge noted: ‘‘You have to be careful, whom you book a minicab for. For example, never book a minicab for somebody from London or somebody who knows the city well, because they will realise that the minicabs we use aren’t much cheaper than Black Cabs and will get suspicious.’’ Suspicious, that is, that part of the money the guest pays the minicab driver makes its way back to the porter or concierge as commission payments, which is exactly what happens and the main reason porters and concierges like using minicabs. ‘Aren’t much cheaper’ is quite an understatement, as the minicab companies charge considerably more for many fares than Black Cabs to cover the commission payments. For the trip from one researched hotel to Waterloo, minicab companies charge up to d15, whereas the same trip in a Black Cab would not come to more than d11. A local fare pays d2 commission, guests going further outside the centre are worth about d5–d6 and a fare to one of the airports can easily net a commission of d10–d20. Busy days earn a concierge or porter d40–d50 in commission payments and even an average day rarely sees them walk out with less than d20. Most receptionists do not know about this sideline and new-starters are told during their training to ‘‘leave taxi and theatre bookings to the concierges and the porters’’. Advice that appears to make good sense, because reception is generally notoriously under-staffed and busy, receptionists often just about manage to cope with their ‘core’ duties. The few, mostly senior, receptionists who do know about the ‘scam’, seem to quietly tolerate it as being part of the considerable informal rewards culture of the hotel.
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In one hotel it was observed that the front office manager knew about it too, but hardly ever intervened. She was only observed intervening when guests complained about the type of taxi booked by the concierges or the price of the fare. She then pretended to be very concerned, but afterwards only made lackadaisical attempts to stop it happening again. Faced with such a lacklustre telling-off by the front office manager, the concierge’s reaction is either to point out the low wages they and their porters are working for or say something along the lines of ‘‘Oh, that’s your free tickets gone then’’. The latter refers to the fact that the concierges frequently supply the front office manager, as well as other managers, with free tickets for exhibitions, plays, concerts and similar events. Senior managers and employees, outside the life-world of the front office, appear to know little about the activities of the concierges and porters. According to one informant: ‘‘Once, [the General Manager of hotel] accidentally got wind of it, because some American guests wrote a letter to him, complaining about the high price charged by a minicab driver we called for them. He made quite a fuss about it, but neither his meeting with the head concierge and the front office manager nor the official memorandum to all front office staff had lasting effects. We’re a bit more careful now, like we don’t book minicabs anymore when managers or staff from other departments stand around at reception and we spoke to the cab companies, so their drivers hand the money over as discreetly as possible, preferably in envelopes.’’ Deciding which cab to order for guests asking for a taxi is not the end of the story, however. If the concierge or porter has decided to book a minicab, the guests have to be kept in the hotel lobby until the driver arrives, lest they should wander outside and be picked up by a Black Cab instead. In which case the concierge or porter not only loses the commission money but also faces upsetting the minicab driver and the minicab company. Having just lost several guests to a Black Cab drivers one night, one informant put it this way: ‘‘Things like that are annoying. I lost d21 tonight, just because they [the guests] wouldn’t stay put and I couldn’t keep an eye on them while they were waiting. As if that wasn’t bad enough, I also got a call from the minicab company and had to listen to the controller winging about lost business and lost time. I don’t want to ruin our relationship with that company, they’re very good, always quick to respond, reliable payers.’’ Later that night, the manager of the minicab company came around to the hotel, ‘‘Just passing by on the way home’’, as he said. ‘‘What happened tonight?’’ he asked the informant. ‘‘You’re not normally that unreliable, right? We’ve lost a lot of money tonight because of you, you know. Believe me, we’d like to provide the best possible service at all times, but if it carries on like that, you might have to wait a little longer for your cabs in the future. Anyway, probably just an unlucky night, hey?’’ The concierges’ and porters’ standard reply to guests for whom they just booked a minicab is, as observed: ‘‘Sir/Madam, your taxi will be here shortly. The driver will come inside to pick you up. Why don’t you have a seat in the bar area or in our group check-in area while you’re waiting?’’ The latter is increasingly important during the night, because neither the bar nor the group check-in area can be seen from outside the hotel, stopping Black Cab drivers walking into the lobby and
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approaching the guests directly. They might do this if they see guests waiting in the empty lobby laden with luggage. Another trick is to quickly grab hold of the guests’ luggage loading it onto the luggage trolley behind the desk in order to wheel it to the cab as soon as it arrives. This is always done in a friendly manner and guests probably never suspect the concierges’ and porters’ real intention, namely to make it harder for them to leave the hotel before the booked cab arrives. Sometimes, guests refuse to take a seat and instead wander around the lobby. As soon as they come too close to the doors, the concierge or porter will flash an apologetic grin and say something along the lines of: ‘‘Sir/Madam, please don’t just take any cab that pulls up outside. I have booked a cab especially for you and the drivers always get rather upset when they arrive and the guests have gone.’’ When the minicab driver arrives, he or she will normally first greet the guests and point out the car to them, then casually stroll over to the desk and greet the porter or concierge who booked the cab. A quick hand-shake transfers the commission and the driver returns to the car and the waiting guests. Sometimes, the guests already stand close to the hotel doors with their luggage ready to board the cab, giving the driver little excuse to walk up to the desk. The concierge or porter will then quickly leave the desk, hurry towards the guests and pretend to help with the luggage or hold the doors open, thus getting close enough to the driver to transfer the commission. Occasionally, Black Cab drivers waiting outside the hotel get upset when they see guests getting into minicabs, especially when they suspect a very lucrative fare, e.g. to Heathrow or Gatwick. In the past, some of them even got out of their cabs and started shouting abusive and threatening remarks at the drivers, guests and the concierge or porter. One informant remarked: ‘‘Sometimes, it got pretty bad. They [Black Cab drivers] would shout and jump and upset everybody around. Guests would get confused when the drivers kept going on about minicabs not being licensed. American guests in particular would get hesitant, thinking that I called one of those rogue minicab drivers their guidebooks are always warning them off using. There wasn’t much we could do, apart from try and get the guests into the minicab as quickly as possible, before one of the Black Cab drivers lost it.’’ Realising that the problem is particularly bad in the early mornings and late evenings when the lobby and the road outside the hotel are empty, one of the interviewed night porters came up with an entirely different solution, which turned out to kill two birds with one stone. ‘‘I mentioned it to a friend who works in the [another hotel in the same chain] and who used to have similar problems with Black Cab drivers, until he came across a chap who drives a licensed Black Cab but tops up his earnings by doing un-metered airport transfers. You can call him anytime, day and night, on his mobile phone, provided you’ve got an airport fare. It’s a bunch of drivers, actually, but he’s the boss. They’re very reliable and quick. They pay the normal commission, but without the minicab hassle, obviously.’’ ‘‘Please note that our staff can only order licensed taxis for guests, they are not permitted to order minicabs’’ says the notice in one of the hotels where the porters and concierges do precisely the opposite. Here the hotel employees act as the gatekeepers between the guest and their taxi journey. This is an opportunity for the entrepreneurial activity of the hotel employees, while paying lip service to the needs
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of the customers (the unreliability of the Black Cabs quoted above), and bypassing the existing power structures within the hotel. An illusion of control is provided. The hotel management receives an efficient guest service (usually), a subsidy for the wages of key staff and occasionally ‘gift’-based rewards from the entrepreneurs organising the ‘scam’. It owes nothing to ‘control’ and everything to ‘negotiation’. As Ritzer (1993) notes: ‘‘humanity is essentially creative and if you develop systems that are constraining and controlling people, the can’t be creative, they can’t be human.’’ Wood (1992) makes the point (when discussing ‘deviance’ and the hospitality industry), that individualistic explanations of ‘non-legitimate’ operative behaviour based on the psychological characteristics of employees ignore social and economic realities. The taxi ‘scam’ is not deviant behaviour: it is ‘normal’ behaviour for the industry. Outside of family owned and managed hotels (where slightly different systems of control seem to operate) we have not found one hotel where this ‘scam’ is not at least an occasional feature. At a speculative level it is possible that the refusal of senior management to acknowledge this activity (either through ignorance or dishonesty) runs parallel to the inadequacies of the more conventional hospitality research tools. Test interview and questionnaire of senior management of hotels where the ‘scam’ was observed revealed nothing about an activity that is worth millions of pounds in the UK alone. An emphasis on quantifiable measures (both in methodologies and management) ignores (possibly deliberately ignores) industry realities. As Morgan (1997) comments: we should always be asking the question ‘‘rational for whom?’’
5. The delivering company It could be argued that the supply of taxis is peripheral to the core business of our hotels, but the next example focuses on the issue of control and the core business, while exploring the interaction with new technology. This is a unit for a company specialising in delivering highly perishable cooked foods to homes and hotels in the central London area. This was a company which has recently completed a huge investment in information technology, including a sophisticated computer telephony integration (CTI). Customers rang a central number with their order. If the number was recognised it was transferred to the local outlet and customer details (e.g. delivery address) appeared with the call. The company (a market leader) put considerable faith in its sophisticated information systems. The company has a bonus system for managers which is tied into two main measures of performance: sales and efficiency. Efficiency is defined as the percentage of consumers who receive their order within 30 min (called the ‘under 30s’, in the company colloquialism). Managers perceive the sales figures as outside their control, so they tend to emphasise the ‘efficiency’ figures: ‘‘who gives a damn about sales as long as my service [‘under 30s’] is above 95% each dayFso what!!’’ (interviewed manager). The ‘efficiency’ figure is manipulated at the point of order. If the operative left the order on the screen (without pressing the button to have the order transmitted to the
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kitchen) then the beginning of the 30 min count could be delayed. Orders could still be taken on other lines. Head office countered this manipulation by recording how long the orders were kept on screen. This device is now being countered by pressing the ‘edit’ button for the order. This means that the order is not on screen, the clock is not running, but the kitchen is processing the order as the order has been passed verbally. The second method of manipulating the time of the order is to put through the order as if it is required in the future. Successful manipulation of the information system to maximise bonus needs skilful professional practice. After all, ‘‘people bad at their legitimate jobs, are unlikely to be any better at coping with fiddling’’ (Mars, 1994). An example of the manipulation failing is the customer who received their product before the order had technically been placed by the system. Bonuses are regulated by the successful use of this manipulation. Apart from using bonuses in an attempt to influence employee behaviour the company also uses technology to make employee behaviour more predictable. Modern information systems often come complete with a ‘scripting’ of operatives to make sure that predictability is maintained: modern property management systems can remind the receptionist whether it is ‘good morning’ or ‘good evening’. This company, with its eight step telephone guide, is no exception. Unfortunately, the rigidity of the system creates its own problems, apart from operative fatigue. There are now websites available detailing questions that customers can use to disrupt the script, but simply an enquiry followed by an order will create sufficient problems. One area where information systems were expected to cut back on fraud was the move away from cash to cards. Observation would tend to suggest that this is not the case. Firstly, phone card checks can enable the criminal consumer to check if his or her stolen credit card is still usable. Secondly, even with an authorisation check the volume of business subsequently found to be through stolen credit cards was thousands of pounds a year. Tolerance for use of these cards seemed surprisingly high, even when their users were known to staff at the unit. Pressure of business led to these losses being written off. One manager said that prosecuting known offenders might have the effect of publicising the ease of the crime. The high proportion of stolen credit card business could be down to the consumer offering a different card to the one mentioned (and authorised) on the phone. However, a significant proportion was internal fraud. One unit manager (not in the surveyed unit) was recently dismissed after hidden video cameras caught him replacing cash orders with stolen credit card ones (and pocketing the cash). The amounts here were highly significant and it seems likely that a general level of this type of fraud is endemic. It was observed that stolen card numbers were used to place bogus orders, which then subsequently became staff food. Normal staff meals can impact on performance bonuses but stolen credit card orders, subsequently eaten as staff food, do not. Computer fraud can be seen as part of a struggle for control between the centre and local units. One duty manager specifically related her manipulation of the bonus system to the head office’s recent decision to stop funding taxis home for managers working beyond one in the morning. She was confident that increasing technological
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monitoring (including video surveillance) could be matched by increasing sophistication on the part of local unit personnel. In part, head office tolerance for widespread (and often obvious) manipulation of the systems, was the product of problems recruiting and retaining staff. As their ‘Operational Effectiveness Survey’ (a difficult to obtain document) noted: ‘‘We do not feel that we retain the right people needed to maintain long term success.’’ Those committing fraud were often the most skilful and hardworking employees (particularly duty managers), which the company needed. With a limited loyalty and low morale from local managers, senior management need care to retain key staff. Unit managers believed that fraud was often known about and accepted (within limits) by area managers, but not known about and accepted by head office. Line managers saw head office as out of touch in more ways than one. Head office’s technological solution to communication problems (a highly sophisticated voicemail system) was universally derided. Frequently, researchers were provided with the story of the head office ice cream promotion, where considerable quantity of ice cream was supplied to local units, but no additional freezer space. Interestingly, head office has become increasingly committed to a language of empowerment and local control, at the same time as its information systems have moved further away from these principles. Head office was renamed ‘Restaurant Support Centre’ and the management structure was made flatter. Considerable effort was put into obtaining the views of local managers. What is interesting is how this contrasts with a local management perspective which sees itself as (in one manager’s words) ‘‘cogs in a wheel’’. They would dispute the Restaurant Support Centre’s view that it is empowering the local units, as the question of ‘‘who gains remains largely mute’’ (Burdett, 1999). If unit managers experience a declining work experience, then changes of terminology, or delayering have less impact than an automating information system.
6. The sustenance company The next focus for the paper is a public house within a large brewery chain. It is situated in a large central London Square and has recently completed a major programme of refurbishment costing hundreds of thousands of pounds. ‘State of the art!’ (interviewed manager) information systems were installed, costing tens of thousands of pounds. The establishment was selected partly to build on the work of Baker et al. (1998) in their study of EPOS systems in public houses, but also because its high proportion of tourist business is unusual, even for Central London. Like the company in the case study above, the brewery also believed that it was ‘‘flattening the organisation, empowering the staff and providing significantly enhanced communication ability’’. In the first month of trading in its newly refurbished format the public house ‘lost’ d30,000. There is an acceptance that public houses are closely involved with processes of ‘fiddling’, as Mars (1994) noted ‘‘drink is often used as the medium of exchange in personal dealings’’ and this has traditionally meant that there is an
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association between public houses and ‘fiddling’. What was unusual about this case was the shear scale of the theft, combined with the sophistication of the system designed to stop it occurring. Managers watched video footage, patched through directly to their computers in the offices downstairs, mystery customers from the company visited every day and spreadsheets were pored over with increasing anxiety. Apart from the information that the losses tended to be concentrated on those areas where the mathematics were simpler (when the pint cost d2.50, for example), the cause of the problem was impossible to determine. At the end of the first months trading, when the ‘fiddling’ had cost almost as much as the systems designed to control it, the problem simply disappeared and fiddling dropped to an ‘acceptable’ (interviewed manager) level of d1000 a month. There were a large number of (voluntary) staff changes, which have been linked to the improved figures, but the method and detail of the fiddle has still escaped management detection. What makes the evasion of detection even more impressive was the depth of information which the system was able to provide. Detailed performance statistics could be provided on each member of staff and this could be related, for example, to the current promotions which the brewery was operating. Operatives found this system alienating and they also objected to name badges and the ability of the EPOS system to display the names of the operative. The ability for customers to use the first names of serving staff was found to be intrusive by most operatives. Operatives also felt that on occasion managers were ‘hiding behind’ their computer screens and avoiding more difficult confrontations with customers. The sophistication of the new system took managers away from their more traditional ‘front-line’ role and shifted them towards a ‘back-office’ one. One experienced operative commented with resentment what she felt was an increasing trend for managers not to serve customers themselves, especially if there were problems. Interestingly this ‘‘conspicuous absence of management at a most critical time’’ Guerrier and Adib (2001) is increasingly common. Korczynski et al. (2000) point to how management’s disembodied concept of the customer is linked to the growth of formal control systems. In the Baker et al. (1998) paper, jointly written with the brewery head office, the studied installation is claimed to ‘belong to the 10–20% of successful IT projects’. When the brewery for the studied public house above, was contacted for its comments on the installation of the information system, it described it as a ‘complete success’. In both cases, possible reasons for this claim were missing. It is possible that the advanced EPOS system improved the speed of service, though operatives claimed that additional keying slowed down service. It is possible that detailed examination of consumer behaviour enabled breweries to restructure prices more profitably, though again operatives felt that it was the drinks that were most sensitive to prices changes, which were increased the most. It is possible that managers were empowered by the additional information available to them, but no data was found to support this. In the minds of brewery managers, one of the key motivators behind the development of their information system was the control and prevention of operative
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‘fiddles’. In the case above this intention clearly failed. It is possible that the sophisticated system was used to facilitate the scale of the theft, but, at the least, it did not deter the theft, hinder it or discover the method. A system designed to impose control through increased predictability and transparency of the actions of operatives had precisely the opposite effectFand at great expense.
7. Implications Where there is power, there is resistance (Foucault, 1979, p. 95). Resistance to formal systems of control is not ‘invisible’. Invisibility is simply the function of the choice of research methods. Resistance is the currency of the daily lives of operatives and managers. The first example of the taxi ‘scam’ explores how operatives can respond and handle individual needs of consumers in a way that formal systems of control cannot. The scale of this particular activity is large, but it is only one of a whole myriad of ‘businesses within businesses’ that can be found within the hospitality industry. The second example of the delivering company shows how resistance can be found at the level of management. Junior managers manipulate a technologically sophisticated system to maximise their income. Sophisticated measures of control imposed by head office are matched with sophisticated measures of resistance. The final example is simple theft, possibly by operatives, possibly by managers, possibly by a combination of the two. Losses were so great that in one month they amounted to greater than the cost of the ‘state of the art’ system designed to prevent these occurrences. Classical management theorists such as H. Fayol, F. Mooney and L. Urwick built up a respectable pedigree for the idea that ‘top-down’ control was key part of management. Taylor’s first principle was the shift of control of the organisation of work from the worker to the manager. Yet in this industry characterised with minuscule levels of union activity and generally low levels of individual operative power, what is often put forward is an illusion of management ‘control’. It is as if there is a gap between the ideology and semantics of the ‘controllers’ and the realities of the workplace. The language of ‘control’ still dominates the actions and words of hospitality management. Yet as seen above, power in the workplace has a complex, negotiated quality, which does not fit well with the language of ‘control’. Every attempt at control carries with it, its own contradictory force.
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