High turnover and so-so customer service characterizes much of the hospitality industry, but not at Las Vegas’ MGM Grand Hotel. The property has one of the lowest turnover rates in Las Vegas and has outperformed nearly all of its competitors. In the course of three years, profits at the hotel doubled and revenues increased from $700 million to $1.2 billion.

It doesn’t hurt that the MGM Grand underwent a massive renovation a few years ago and brought in top acts such as Cirque du Soleil. But if you ask the hotel’s CEO Gamal Aziz why MGM is different, he will tell you it is because of the company’s 10,000 employees and how engaged they are. “Employees are willing to give their all when they are well-treated and appreciated. Imagine taking 10,000 employees, and each and every one of them wanting to give more. That’s really the difference between [us and] a company that has its employees just punching the clock and trying to get through the day,” says Aziz. 

But this scenario wasn’t always the case. When Aziz took the helm of the MGM Grand in 2001, its customer service numbers were not good. The lights were on at the strip, but at MGM, employees were in the dark: An employee survey showed that workers received very little communication from their managers. If important guests were staying at the hotel, workers had no clue. Many times, they did not know what conventions were being held at the hotel and how or what to offer these guests. Not surprisingly, it was hard to provide customers a high level of service and earn their loyalty.

Aziz changed that. At the start of every shift, he instituted short meetings to let the staff know what’s happening in the hotel each day. He also expanded MGM Grand University, the company’s managerial training program, and involved employees in decisions about its offerings. Another thing that has changed is that the company now goes out of its way to recognize employees who do a great job. The hotel’s award-winning recognition programs include employee-of-the month luncheons, recognition posters, a “star of the month” board, coffee chats with employees, mandatory employee recognition training, appreciation dinners for top performers hosted by Aziz, and plain old pats on the back. Before new recognition programs are instituted, the company seeks feedback from previous employee recognition “champions” and focus groups to ensure that they are aligned with the company’s core business goals. 

Questions 

1. Identify the ways in which the MGM Grand Hotel engages its employees. 

2. What HR aspects of the hotel resemble high-performance work systems? 

3. What role does information sharing plays in supporting its efforts?