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Attitudes of Hong Kong hotel managers towards the use of expatriates
Int. J. Hospitality Management Vol. 13 No. 2, pp. 183-187, 1994 Copyright fQ 1994 Elsevier Science Ltd Printed in Great Britain. All rights reserved 02784319/94 $7.00 + 0.00
Pergamon
0278-4319(93)00018-2
Research Note
Attitudes of Hong Kong hotel managers towards the use of expatriates Ricky W. Y. Yu and Ray Pine Department of Hotel and Tourism Management, Hong Kong Polytechnic, Hung Hom, Kowloon, Hong Kong
The study examines the attitudes of both local and expatriate hotel managers in Hong Kong towards the use of expatriate managers in that industry. It was found that there are quite a few expatriate hotel managers working in Hong Kong whoperceived the use of expatriates to be justified and fair. However, local hotel managers had a different attitude towards this issue, and sought more opportunities in top management and better remuneration. Key words:
local managers expatriate managers multinational hotel corporations
The role of expatriate hotel managers Hong Kong, being one of Asia’s major tourism centres, is the headquarters of many domestic and multinational hotel corporations. These companies and their hotels provide a large amount of job opportunities ranging from operational level to managerial level to the local as well as the international labour market. It is found that the Hong Kong hotel industry employs quite a high proportion of expatriate managers, especially in luxury hotels. Although only 16.8 percent of hotel managers in Hong Kong are expatriates, they tend to dominate the top management positions. A concurrent research project being carried out in the Department of Hotel and Tourism Management at Hong Kong Polytechnic (Pine and Ruddy, 1994) reveals that about fifty percent of the Genera1 Manager and Resident Manager posts are held by expatriates. Multinational hotel corporations and expatriate management are very important in the 183
184
Ricky W. Y. Yu and Ray Pine
initial stage of development of the hotel industry (Ascher, 1985; WTO, 1988). Before Hong Kong was developed as a tourist destination, managerial know-how of operating hotels, especially knowledge on managing luxury hotels, was particularly scarce. This was because local managers were less familiar with the conjumption pattern and taste of the international business traveler in comparison with expatriate managers coming from the same countries of these tourists or having experience of serving these tourists (Ascher, 1985). As the hotel industry has grown and become mature, many local personnel have received speciafized hotel training and have acquired practical experience of managing international hotels by working in these hotels (UN, 1982). Some of these qualified local personnel have successfully struggled to reach the top management of many single hotels and hotel chains. At this stage, the role of expatriate managers may be more than just maintaining the profitable operation of a hotel, but could also include development of local management personnel. The target may be to localize the whole management structure within a certain period of time.
Objectives and methods of the study This Note aims to review whether there is a perceived change in the traditional role of expatriate hotel managers in Hong Kong, and what is the attitude of expatriate managers towards their own role as well as the attitude of local hotel managers towards their expatriate counterparts in the industry. The data used in this research note are part of the results of a large scale research project (Yu and Pine, 1994) which aims to investigate the use of local and expatriate hotel managers in Hong Kong. Two hundred and five local hotel managers and forty-two expatriate hotel managers in Hong Kong have answered a questionnaire and expressed their attitude towards 29 statements about the use of local and expatriate managers. Preliminary analysis of five of these statements, which particularly focus on expatriate hotel managers, is presented here. The respondents were selected from a list of hotel executives in Hong Kong. They ranged from top executive to middle management, and they worked in all the various departments in hotels of different sizes and star grading.
Initial Results Respondents were asked to show their attitudes towards the given statements by using a scale of 1 to 5, where 1 means strongly agree while 5 means strongly disagree. Table 1 shows the overall mean score for each statement and the difference in mean score between local and expatriate hotel managers. The significance of the difference in mean score between local and expatriate hotel managers was tested by separate variance two-tail t-test. Ali results have a significance level (t-value) of less than 0.05, and two of them have a significance level of less than 0.01.
Attitudes of Hong Kong hotel managers towards the use of expatriates
185
Table 1
Statement 1 2 3 4 5 (*>0.05
Overall mean score
Local mean score
Expatriate mean score
t-value
2.5 3.0 2.6 2.1 2.0
2.6 3.1 2.5 2.1 1.9
2.0 2.3 2.9 2.5 2.4
3.a*+ 6.5”” 2.3* 2.5* 3.5**
and +*>O.Ol).
Statement I: The presence of expatriates is important to the quality of services of luxury hot& in Hong Kong. The overall score for this statement was 2.5. This implies that hotel managers tended to realize the importance of expatriates to the quality of services. Local managers perceived the presence of expatriates to be less important to the quality of services in luxury hotels (mean = 2.6) than the expatriate managers did (mean = 2.0). This shows that expatriate managers perceived their own professional knowledge and experience as very important in controlling the quality of services, and this kind of managerial expertise may be not available from local personnel.
Statement 2: Expatriates are employed to develop local hotel managers. The overall score for this statement was 3.0. This indicates that hotel managers had a neutral attitude towards the trainer’s role of expatriates and the contribution of expatriates in developing local hotel managers. Expatriate managers perceived that the task of expatriate hotel managers was to develop local managers (mean = 2.3) significantly more than the local managers perceived this task to be (mean = 3.1). This shows that expatriate hotel managers agreed with their responsibility in developing local personnel. However, local managers did not agree that expatriate hotel managers have put neither sufficient nor appropriate effort in training local hotel managers. Statement 3: Policies in Hong Kong’s hotels favour the use of expatriates. l
l
The overall score for this statement was 2.6. This indicates that hotel managers tended to believe the existence of policies favouring the use of expatriates. Local managers perceived the hotel policies favouring the use of expatriates (mean = 2.5) more than the expatriate managers did (mean = 2.9). On the other hand expatriates were less sure about the presence of any policy favouring themselves nor any policy discriminating against the use of local managers.
Statement 4: The salary of expatriates is more than locals in similar posts. l
The overall score for this statement was 2.1 This implies that hotel managers admitted the existence of a compensation gap betweec local and expatriate managers, that is, expatriates earn more.
186 l
Ricky W. Y. Yu and Ray Pine
Local managers perceived (mean = 2.1) more strongly than expatriates did (mean = 2.i) that the salary of expatriates is higher than locals in similar posts. This could lead to dissatisfaction among local managers.
Statement 5: More locals should be used at the top managerial l
l
grade.
The overall score for this statement was 2.0. This implies that many top executive positions in hotels in Hong Kong were held by expatriates and there was the potential of using more local managers in top level management. Local managers strongly believed that locals should be used at the top managerial grade (mean = 1.9) more than the expatriates perceived (mean = 2.4). This shows that local hotel managers had a very strong desire for more top management and decision-making job opportunities. Although expatriate hotel managers agreed less with this notion, they did not express any major objection.
Discussion To summarize the attitude of hotel managers toward the use of expatriates, there appeared to be no obvious negative attitude towards further use of expatriates but local hotel managers were seeking for a more important role in the industry. The attitude of local hotel managers was that they should have more opportunities in top management and be better paid, the presence of expatriates may be alright but it is not a necessity in terms of controlling quality of service nor training local managers. The attitude of expatriate hotel managers was that they are not discriminating against locals, nor unfairly highly paid, the industry needs them for high quality service. They agreed that they have the responsibility of developing local managers and it is possible to have more local managers in the top management of hotels in Hong Kong. Long-term development of Hong Kong as an Asian hotel centre, and internationalization of Hong Kong-based hotel chains, do require a large amount of qualified local hotel managers who are familiar with the local environment, China, and other Asian countries. Neither promotion of unqualified locals nor prolonged dependency on expatriates is an ideal policy for hotels in Hong Kong. Local and expatriate managers should work together to achieve high quality hotel service, and in the development of local hotel management in Hong Kong. There is a lot to be learnt from expatriates, especially their international experience and knowledge of foreign markets.
References Ascher, Francois (1985) Tourism: Transnational Corporations and Cultural Identities. Unesco. Pine, R. and Ruddy, J. (1994) Management Structures in Hong Kong Hotels-Trends in Executive Development, Hong Kong Polytechnic Research Committee sponsored research project. UN (1982) Transnational Corporations in International Tourism. Centre on Transnational Corporations, United Nations, New York. WTO (198.5) The Role of Transnational Tourism Enterprises in the Development of Tourism. World Tourism Organization. WTO (1988) Guidelines for the Transfer of New Technologies in the Field of Tourism. World Tourism Organization.
Attitudes
of Hong Kong hotel managers
towards
the use of expatriates
187
Yu, R. W. Y. and Pine, R. (1994) The data and comments presented in this Research Note are from initial work carried out as part of research in support of an MPhil degree based in the Department of Hotel and Tourism Management at Hong Kong Polytechnic. The research work is conducted by Ricky Yu, an MPhil candidate, under the supervision of Dr Ray Pine. The work, entitled: The Use of Local and Expatriate Hotel Managers in International Tourism Development: Policy and Attitude Towards Localization in Hong Kong, is scheduled for completion in mid-1994 and full results will be available after that time.
Pergamon
0278-4319(93)00018-2
Research Note
Attitudes of Hong Kong hotel managers towards the use of expatriates Ricky W. Y. Yu and Ray Pine Department of Hotel and Tourism Management, Hong Kong Polytechnic, Hung Hom, Kowloon, Hong Kong
The study examines the attitudes of both local and expatriate hotel managers in Hong Kong towards the use of expatriate managers in that industry. It was found that there are quite a few expatriate hotel managers working in Hong Kong whoperceived the use of expatriates to be justified and fair. However, local hotel managers had a different attitude towards this issue, and sought more opportunities in top management and better remuneration. Key words:
local managers expatriate managers multinational hotel corporations
The role of expatriate hotel managers Hong Kong, being one of Asia’s major tourism centres, is the headquarters of many domestic and multinational hotel corporations. These companies and their hotels provide a large amount of job opportunities ranging from operational level to managerial level to the local as well as the international labour market. It is found that the Hong Kong hotel industry employs quite a high proportion of expatriate managers, especially in luxury hotels. Although only 16.8 percent of hotel managers in Hong Kong are expatriates, they tend to dominate the top management positions. A concurrent research project being carried out in the Department of Hotel and Tourism Management at Hong Kong Polytechnic (Pine and Ruddy, 1994) reveals that about fifty percent of the Genera1 Manager and Resident Manager posts are held by expatriates. Multinational hotel corporations and expatriate management are very important in the 183
184
Ricky W. Y. Yu and Ray Pine
initial stage of development of the hotel industry (Ascher, 1985; WTO, 1988). Before Hong Kong was developed as a tourist destination, managerial know-how of operating hotels, especially knowledge on managing luxury hotels, was particularly scarce. This was because local managers were less familiar with the conjumption pattern and taste of the international business traveler in comparison with expatriate managers coming from the same countries of these tourists or having experience of serving these tourists (Ascher, 1985). As the hotel industry has grown and become mature, many local personnel have received speciafized hotel training and have acquired practical experience of managing international hotels by working in these hotels (UN, 1982). Some of these qualified local personnel have successfully struggled to reach the top management of many single hotels and hotel chains. At this stage, the role of expatriate managers may be more than just maintaining the profitable operation of a hotel, but could also include development of local management personnel. The target may be to localize the whole management structure within a certain period of time.
Objectives and methods of the study This Note aims to review whether there is a perceived change in the traditional role of expatriate hotel managers in Hong Kong, and what is the attitude of expatriate managers towards their own role as well as the attitude of local hotel managers towards their expatriate counterparts in the industry. The data used in this research note are part of the results of a large scale research project (Yu and Pine, 1994) which aims to investigate the use of local and expatriate hotel managers in Hong Kong. Two hundred and five local hotel managers and forty-two expatriate hotel managers in Hong Kong have answered a questionnaire and expressed their attitude towards 29 statements about the use of local and expatriate managers. Preliminary analysis of five of these statements, which particularly focus on expatriate hotel managers, is presented here. The respondents were selected from a list of hotel executives in Hong Kong. They ranged from top executive to middle management, and they worked in all the various departments in hotels of different sizes and star grading.
Initial Results Respondents were asked to show their attitudes towards the given statements by using a scale of 1 to 5, where 1 means strongly agree while 5 means strongly disagree. Table 1 shows the overall mean score for each statement and the difference in mean score between local and expatriate hotel managers. The significance of the difference in mean score between local and expatriate hotel managers was tested by separate variance two-tail t-test. Ali results have a significance level (t-value) of less than 0.05, and two of them have a significance level of less than 0.01.
Attitudes of Hong Kong hotel managers towards the use of expatriates
185
Table 1
Statement 1 2 3 4 5 (*>0.05
Overall mean score
Local mean score
Expatriate mean score
t-value
2.5 3.0 2.6 2.1 2.0
2.6 3.1 2.5 2.1 1.9
2.0 2.3 2.9 2.5 2.4
3.a*+ 6.5”” 2.3* 2.5* 3.5**
and +*>O.Ol).
Statement I: The presence of expatriates is important to the quality of services of luxury hot& in Hong Kong. The overall score for this statement was 2.5. This implies that hotel managers tended to realize the importance of expatriates to the quality of services. Local managers perceived the presence of expatriates to be less important to the quality of services in luxury hotels (mean = 2.6) than the expatriate managers did (mean = 2.0). This shows that expatriate managers perceived their own professional knowledge and experience as very important in controlling the quality of services, and this kind of managerial expertise may be not available from local personnel.
Statement 2: Expatriates are employed to develop local hotel managers. The overall score for this statement was 3.0. This indicates that hotel managers had a neutral attitude towards the trainer’s role of expatriates and the contribution of expatriates in developing local hotel managers. Expatriate managers perceived that the task of expatriate hotel managers was to develop local managers (mean = 2.3) significantly more than the local managers perceived this task to be (mean = 3.1). This shows that expatriate hotel managers agreed with their responsibility in developing local personnel. However, local managers did not agree that expatriate hotel managers have put neither sufficient nor appropriate effort in training local hotel managers. Statement 3: Policies in Hong Kong’s hotels favour the use of expatriates. l
l
The overall score for this statement was 2.6. This indicates that hotel managers tended to believe the existence of policies favouring the use of expatriates. Local managers perceived the hotel policies favouring the use of expatriates (mean = 2.5) more than the expatriate managers did (mean = 2.9). On the other hand expatriates were less sure about the presence of any policy favouring themselves nor any policy discriminating against the use of local managers.
Statement 4: The salary of expatriates is more than locals in similar posts. l
The overall score for this statement was 2.1 This implies that hotel managers admitted the existence of a compensation gap betweec local and expatriate managers, that is, expatriates earn more.
186 l
Ricky W. Y. Yu and Ray Pine
Local managers perceived (mean = 2.1) more strongly than expatriates did (mean = 2.i) that the salary of expatriates is higher than locals in similar posts. This could lead to dissatisfaction among local managers.
Statement 5: More locals should be used at the top managerial l
l
grade.
The overall score for this statement was 2.0. This implies that many top executive positions in hotels in Hong Kong were held by expatriates and there was the potential of using more local managers in top level management. Local managers strongly believed that locals should be used at the top managerial grade (mean = 1.9) more than the expatriates perceived (mean = 2.4). This shows that local hotel managers had a very strong desire for more top management and decision-making job opportunities. Although expatriate hotel managers agreed less with this notion, they did not express any major objection.
Discussion To summarize the attitude of hotel managers toward the use of expatriates, there appeared to be no obvious negative attitude towards further use of expatriates but local hotel managers were seeking for a more important role in the industry. The attitude of local hotel managers was that they should have more opportunities in top management and be better paid, the presence of expatriates may be alright but it is not a necessity in terms of controlling quality of service nor training local managers. The attitude of expatriate hotel managers was that they are not discriminating against locals, nor unfairly highly paid, the industry needs them for high quality service. They agreed that they have the responsibility of developing local managers and it is possible to have more local managers in the top management of hotels in Hong Kong. Long-term development of Hong Kong as an Asian hotel centre, and internationalization of Hong Kong-based hotel chains, do require a large amount of qualified local hotel managers who are familiar with the local environment, China, and other Asian countries. Neither promotion of unqualified locals nor prolonged dependency on expatriates is an ideal policy for hotels in Hong Kong. Local and expatriate managers should work together to achieve high quality hotel service, and in the development of local hotel management in Hong Kong. There is a lot to be learnt from expatriates, especially their international experience and knowledge of foreign markets.
References Ascher, Francois (1985) Tourism: Transnational Corporations and Cultural Identities. Unesco. Pine, R. and Ruddy, J. (1994) Management Structures in Hong Kong Hotels-Trends in Executive Development, Hong Kong Polytechnic Research Committee sponsored research project. UN (1982) Transnational Corporations in International Tourism. Centre on Transnational Corporations, United Nations, New York. WTO (198.5) The Role of Transnational Tourism Enterprises in the Development of Tourism. World Tourism Organization. WTO (1988) Guidelines for the Transfer of New Technologies in the Field of Tourism. World Tourism Organization.
Attitudes
of Hong Kong hotel managers
towards
the use of expatriates
187
Yu, R. W. Y. and Pine, R. (1994) The data and comments presented in this Research Note are from initial work carried out as part of research in support of an MPhil degree based in the Department of Hotel and Tourism Management at Hong Kong Polytechnic. The research work is conducted by Ricky Yu, an MPhil candidate, under the supervision of Dr Ray Pine. The work, entitled: The Use of Local and Expatriate Hotel Managers in International Tourism Development: Policy and Attitude Towards Localization in Hong Kong, is scheduled for completion in mid-1994 and full results will be available after that time.