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Back to Normal After SARS? Let’s Hope Not ….

By Mark Keith, HOTEL Asia Pacific Columnist
June 2003
 
Many in the hotel industry in Asia Pacific are praying that things will soon get back to the way they used to be. But, hopefully, many of the old ways of doing business are gone for good, says human resources expert and HOTEL Asia Pacific columnist Mark Keith

WHEN the SARS panic eventually dies down I, for one, hope that things never get back to normal. Not if “normal” means being equally ill-prepared when the next crisis hits.

Hotels throughout the region are having to make some tough HR decisions, with many already introducing unpaid leave that ranges between 20% and 48% of the working month. 

But senior staff are still expected to continue to work the “hours required”, which effectively makes this unpaid leave an ill-disguised pay cut. 

One of the main questions I’m continually being asked is: “Will these measures be lifted when things get back to normal?” 

Don’t count on it. But the crisis - for all its agony - might produce some much-needed changes in the industry.

During these abnormal times, I have had the opportunity to dine in quite a few hotel restaurants, which has reinforced my view that things need to change – and fast. 

Although these establishments were clearly suffering from a lack of business, the consistent response from restaurant managers when asked how they were doing was to complain about how difficult it was to operate with reduced headcounts. 

On one occasion, four of us were lunching in a particularly quiet establishment in Hong Kong. When the main course arrived, the dishes were brought to our table on a tray carried by a busboy, who then stood immobile as his waiter colleague removed the covers and presented each of us with our meal. 

The head waiter hovered a few feet away, monitoring the service delivery and ensuring that the transfer of food from kitchen to customer was carried out faultlessly. 

If we had ordered a similar meal in a hotel restaurant elsewhere in the world, one waiter would have been expected to take our order, serve our drinks, carry trays to and from the kitchen, used a tray stand to assist in the service and handled the billing. He would also have been knowledgeable about the menu and wines, talked to us and built a rapport designed to bring us back to the restaurant. 

Paradoxically, this one waiter’s remuneration would likely equal the total of the salaries of the busboy, waiter and head waiter in Hong Kong.

The current crisis provides us with a reminder that it is time to tackle the cost base of Hong Kong’s hotels, our service-delivery procedures and the facilities we offer our guests.

Hong Kong hotels enjoyed a rare 20 years of stability and growth, which saw payroll costs soar through the roof. In the early ‘80s, a luxury hotel in Hong Kong could proudly boast of labour costs of 12-15%, but this was so insignificant that many hotels didn’t even bother to monitor the ratios. Today, this percentage is closer to 40% - even though headcounts are down by a third. 

The current crisis not only highlights questions about service delivery, but also touches the very design of hotels and the provision of services in a region that has historically enjoyed cheap labour. 

There is talk of outsourcing basic services, such as housekeeping and engineering, but rarely is it implemented, and any notion of letting a specialist outside company lease and run the restaurants is usually stifled at birth. 

Every evolution has its time - and this is the time to consider how to reconfigure our service-delivery systems, our service expectations and, especially, the design and components that our hotel offers their guests. 

Changes will be resisted, as they always are, but the acid test will be passed by those managers who overcome the resistance and convert payroll from a fixed to a variable expense. 

The indicators of this evolution will include: flatter organisations; pay at risk rather than guaranteed; inequality in pay between expatriates and locals will be the exception rather than the rule; and recognition of talent rather than seniority will determine pay and promotion.

A few years ago, a friend was appointed to a senior-level position in a well-known hotel company and, during his first week at the job, he invited me to lunch to celebrate. It was a wonderful meal that was spoiled by much “hovering” by a plentiful selection of waiting staff. 

It was also punctuated by visits from numerous senior staff who, upon hearing that the new director was lunching in the restaurant, considered it a wise career move to go and enquire if the meal was meeting his expectations. 

It sounds farcical, but we actually had eight visits from sycophants enquiring whether we were enjoying the meal. I was secretly enjoying what was turning out to be a bit of unexpected light comedy, but my friend took a less humorous view. 

After number eight had humbly retreated from our table, my friend signaled for the restaurant manager and ordered him to intercept any other attempts at ingratiation. He then turned to me and treated me to a piece of basic wisdom that he has since used to climb to the pinnacle of his career. 

“I’m terribly embarrassed,” he confessed. “The restaurant is full, but none of the other tables have had even one visit enquiring about their enjoyment of the meal. We’ve had eight such visits - and we’re not even normal paying customers.” 

Of course, he was right - I had merely enjoyed the entertainment value of the “visits”, while he had seen the impact they were having on diners at the other tables.

That little anecdote demonstrates how far removed from reality the industry has become. Recent events suggest that we will have to face economic crises on a regular basis so, instead of looking forward to “getting back to normal”, let us use this current crisis as a catalyst that will enable us to determine how we can ensure that our largest expense item - payroll - is a true variable expense that can be flexed and honed to suit changing circumstances. 

This can be achieved while still meeting the standards of excellence and service surprises that our customers have come to appreciate. At the same time, it can avoid the stress and trauma that are currently being suffered by our loyal staff caused by the introduction of unpaid leave, redundancy and other drastic measures. Not to mention its effect on the ambitions of bright school leavers who are currently considering career choices. 

Some might say this is a wishful dream and impossible to implement, and that we should do everything possible to “get back to normal”. 

Instead, I hope that something positive comes out of the region’s experience with SARS, and that we are able to forge a better working relationship with our staff based on the realities of today’s economic conditions.

Like it or not, “normal” is a word that no longer belongs in the vocabulary of any hotel professional.

© Copyright HOTEL Asia Pacific

Contact:

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Hotel Asia Pacific
Steve Shellum
158 Wong Uk Tsuen
Yuen Long
New Territories
Hong Kong
Tel: +852 2882-7352
Fax: +852 2882-2461
http://www.hotelasiapacific.com
[email protected]

 
Also See Fighting Spirits! Rank-and-file Staff at Bali InterContinental Resort Talk About Their Hopes, Fears, Dreams / HOTEL Asia Pacific / April 2003
On the Chopping Block; Are You Prepared If You Get Your Marching Orders? / HOTEL Asia Pacific / April 2003
Trevor Bilney, Executive Chef at the Bali InterContinental Resort, Fights Hard Since Last October 12; Keeps Morale Up  and Costs Down / HOTEL Asia Pacific / March 2003
Hotels Stepping Up Security; Learning to Live with the Threat of Terrorism as Part of Conducting Everyday Business / HOTEL Asia Pacific Survey / March 2003
50% of Hoteliers Have Not Increased Investment in Security – More than a Year After the September 11 Attacks / HOTEL Asia Pacific Survey / December 2002
Security: Something No Hotel Can Ignore / Geoff Griswold / Summer 2002
Biometrics Lend a Hand to Hotel Security / Feb 2002
Hotels Near Airports Provide Better Safety and Security Features According to The Center for Hospitality Research - Cornell Hotel School / Dec 2002


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