By Larry and Adam Mogelonksy
Regardless labor, where do we stand as 2022 comes to a close? Wages are up, shortages are still rampant, industry turnover is a consummate challenge and guest demand is normalizing from the pandemic. Not a great place to be in when it comes to protecting your P&L. But what we are seeing and helping hotels implement is a better way of organizing teams so that hotels can fight against inflationary wages and churn with better corporate cultures.
A central problem with the hospitality industry’s current labor crisis is that by framing it as a ‘crisis’ we are presuming that the shortage will naturally pass by and labor conditions will eventually return to how they were in 2019. Hoteliers just have to ride it out and everything will be fine by 2023. This is a dangerous mentality; thinking in terms of crises is short-term and the post-pandemic hotel corporate culture requires a long-term solution.
Firstly, we see this as a matter of ‘the problems you see and the ones you don’t see’. That is, it’s easy to quantify how associate-level costs are going up, and yet few of us are doing the necessary calculations to measure employee replacement costs – recruiting, training, signing bonuses, service interruptions and loss of knowledge. When all is tallied, the replacement cost is often far greater than any nominal pay-scale increase designed to help boost retention.
We mentioned this because rising wages and churn hark at a bigger issue – ensuring that hotels are great places to work. And this depends on ‘soft skills’ and cultural aspects – or should we say, ‘corporate community’ aspects – that are often mutually exclusive from monetary compensation.
Now, without further adieu, here is a starting checklist to rate yourself on your management approach. Ten items with each scored out of 10 for a final score out of 100. There are obviously far more than these ten areas, but this is a good starting point.
Honestly appraise yourself as follows:
- Are you honest and open to your team? Are you transparent in your approach? Do you work at instilling confidence in your team members? Do they trust you?
- Are you a walk-around manager? Do you regularly eat in the hotel cafeteria? Have you visited engineering, housekeeping and other BOH functional locations on at least a weekly basis? When was the last time you sat in on a sales or catering presentation?
- Do you know your employees by name? Do you have regular events where you can meet with them? Can you say that you know them beyond just work? After all, they have families too.
- Do you consider yourself to be fair and equitable? Do you adequately reward your employees for their efforts?
- Do you listen to your team members? Do you seek their counsel on issues that relate to their area of expertise and influence? How receptive are you to new ideas?
- The hotel business is not just ADR, RevPAR and percentage occupancy. Do you understand all aspects of your business? Can you converse with the teams in purchasing, reservations, IT, sales, catering and marketing? Can you use your PMS and complete a check-in? How up to date are you with your own website?
- Do you motivate your team to better themselves? Do you have to repeatedly ask employees to carry out tasks as instructed? Are your instructions clearly defined both in exact procedure as well as their underlying reason for execution?
- Do you actively seek to promote from within and encourage this succession planning? Do you have plans that encourage your team members to see their position as part of a career in hospitality rather than just a job? Do you have a program in place to upskill associates into managers?
- Do you keep abreast of what is happening in your community? Do you encourage your team members to participate through appropriate behaviours such as recognition or compensatory time off?
- We all know that a bad apple can ruin the basket, as can a bad employee. Are you appropriate, fair and consistent when you deal with these potentially toxic situations? Do your actions set a moral example for the rest of the team?
While many of these are more qualitative than quantitative, the exercise should nevertheless offer some introspection. Let’s say an ‘A’ score is 80 or above, but this is still no excuse for a fixed mindset and not seeking continuous improvement. If you can reform your culture and improve on these soft skills, then it will help mitigate against a lot of other points that you can directly quantify in dollar figures.