An exploratory study of human resource management and business strategy in multiunit restaurant firms

Abstract

The objectives of this study is two-fold: First, is to explore the nature of human resource management (HRM) functional activities in the multiunit restaurant firms, focusing at the unit restaurant managers level. The second objective is to investigate the relationship between the firm's business strategy and its HRM practices. This study addresses the critical need for empirical research that examines HRM practices in restaurant firms, and presents a possible solution to the acute management shortage problem in the industry. Data are collected from 14 publicly-traded multiunit restaurant firms. A case study approach is taken to provide an in-depth examination of each firm. Primary data are derived via interviews and structured mailed questionnaires. Information is also collected through published sources.

The results indicate that restaurant firms do have similar HRM functional activities' emphasis. Some of those activities were found to support the firm's business strategy. An analysis of the qualitative data indicate that although the HRM executives are involved in the firms' strategic planning process, the current acute labor shortage and high turnover problems demand them to focus on administrative issues instead. The study provides exploratory evidence for the effectiveness of a positive link between HRM practices and business strategy. It has contributed to a deeper understanding of the issues and functions of the HRM divisions in the multiunit restaurant firms.