Managing Talent Loss in the Procurement Function: Insights from the Hospitality Industry

Abdelkader Daghfous,Omar Belkhodja

doi:10.3390/su11236800

Abstract

This paper sought to extend the existing talent management literature through an exploratory investigation of talent loss resulting from the possible departure of talented employees from the procurement function of hotels. Through a multiple case study of five organizations in the hospitality industry, we found that the departure of talented procurement managers disrupts supply chain operations and leads to a loss of valuable explicit, tacit, and relational knowledge. Procurement managers were found to hold critical skills and knowledge that are essential for the case organizations. Hence, more proactive management strategies were adopted. Managers seeking to minimize the negative impact of talent loss in the procurement function would be well-advised to treat this procurement function as a strategic one and to adopt proactive and documented management strategies. Firms should be aware of the type of important knowledge and of the importance of aligning their strategies with such knowledge. To retain relational knowledge in case of talent loss, strategies should be designed to reduce the firm’s reliance on personal contacts and emotion-based trust in supplier relationships. We concluded the paper with implications for future research and managerial practice for managing talent loss, with an emphasis on sustainability in the hospitality industry.

Highlights

With the current digitization and evolution of business dynamics, the role of the procurement function within firms is becoming increasingly critical to the success and stability of their operations [1]
Procurement plays a crucial role in the hospitality industry, which contributes over $2.3 trillion to the global Gross Domestic Product (GDP) per annum [4]
We argue that is the topic of talent loss in the procurement function of hotels underexplored, and that no prior empirical study has investigated this topic in the geographical context of the United Arab Emirates (UAE), which is located in the Arabian Gulf

Summary

Introduction

With the current digitization and evolution of business dynamics, the role of the procurement function within firms is becoming increasingly critical to the success and stability of their operations [1]. Procurement acts as a driver of cost efficiency, supplier integration, and supply chain management which contributes to sustaining the firm’s competitive advantage [2]. The findings of a survey by Deloitte highlighted that the procurement functions within large corporations are continuously striving to reduce their costs to contribute to strategic targets. A knowledge-intensive procurement function acts as a facilitator of supply chain activities [5]. In multinational hotel chains and luxury hotels, the procurement role is even more pronounced, as it facilitates strategic growth and helps hotels to differentiate their final products and services from competitors [6]. The outreach of Avendra’s operations, coupled with the valuable expertise and knowledge of their in-house procurement teams, allowed these hotels to streamline their global supply chains and provide the best-in-class experience to their customers [8]

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Conclusion