By Samantha Noll
Take a moment, and think to yourself: what truly makes my hotel successful? New properties and new hotel brands are popping up everywhere like mushrooms; in such an ever-growing industry, the rise of competition is inevitable and the best way to succeed and stand out on top is to start by looking from within. Think about the one and only asset you have that you can truly rely on to be your source of differentiation and to be unique in your market: your team of employees.
Surprisingly, the hospitality sector experiences the highest turnover rates compared to other industries – often double as high as that of other industries, with the average rate around 30%. This poses multiple challenges for all hoteliers out there, leaving them with the one ultimate question: how do I create and grow a team of motivated employees that live our company’s values and strive to consistently deliver on our guests’ desired experience? – Your number one priority.
Of course, with high turnover, this becomes more difficult to achieve, as the constant shift in a team of employees has repercussions on productivity which can then negatively impact the guest experience. Also, keep in mind, that turnover bears high costs for your business, usually amounting to 1.5 – 2 times that of an employee’s annual salary for each lost employee – definitely not an easy blow for your bottom line! It is clear, ensuring that you have a high employee retention rate is of utmost importance: for your financials and much more importantly for your guests.
In a people-industry such as hospitality, where it is the passion of each and every one of us in a hotel to make our guests feel welcome and grow their loyalty, it makes me wonder why it is challenging to have the employees themselves stay on and be loyal to the hotel. Taking a step back to understand, here are a few common reasons:
- Simply a lack of fit between an employee’s values and a company’s organizational culture
- Perceived long working hours with low pay rates, affecting employee work-life balance
- Strong seasonality, where large amounts of temporary staff are hired during high season
- Filling of entry-level operational jobs positions with an untrained, unskilled labour pool
- Old fashioned training opportunities, with a lack of career prospects provided
- Growing demands of Generation Y, who are always on the lookout for something new, in highly flexible, creative environments
Having talked to several hospitality industry professionals from around the globe who know the business inside-out, they bring to light additional reasons from their experience.
As René Wildeman (CEO & Founder of Wildeman Hospitality Consultancy) shared: “The most common reason for staff turnover is the pressure put on performance without giving enough appreciation to the individual employee or the employees as a group. Shareholders’ value has become increasingly important in many hotel (groups) so cost of staff, which is an important part of total cost, is reduced by limiting the number of employees. As a result, others have to perform better and more. Many employees will understand this and are willing to accept it but they want appreciation in return which does not automatically mean a financial compensation. If they do not feel appreciated they will try their luck somewhere else.”
In line with this, Thomas Noll (Regional Director Kazakhstan for Rixos Hotels) also mentions that “not recognizing superior performance, not providing growth opportunities early in enough, and not providing a career plan for those who seek careers” are among the top reasons for staff turnover today.
Employees are forced to seek better career moves with the presence of “slow progressive growth, non-aligned company culture and lack of authentic communication from your boss”, Asim Ibrahim (CEO & Founder of Lakeshore Hospitality Group) points out, also highlighting that “loyalty is a two-way street for employer and the employee”.
Employee turnover is prevalent in all industries and it is crucial to be aware of the triggers which can affect yours. As Gallup’s latest study shows, only 13% of employees worldwide are actively engaged, while the majority lacks the motivation to contribute to business success – this has its toll on the hospitality industry too! What can you do about it?
I’d like to outline four main areas of focus in an employee’s job cycle that can help you lead a long-standing team to make your hotel as successful as it can be. Of course, these things will sound familiar to you, and I encourage you to look into them with a refreshed perspective:
- Search wisely, hire for personality, and set the right expectations
It all starts in your hands. Know upfront exactly which character traits you are looking for in a future employee for your hotel and your recruitment process will be more targeted and effective. Don’t forget that a skill-set is secondary to someone’s personality, the latter being much more difficult to change. Most importantly – do you feel that this prospective employee really has the true passion for hospitality? If yes, you’ve found yourself a gold mine – treasure it! Ensure there is a fit in what the employee is looking for, the position you are offering, and your company’s organizational values; this way you can also set the right expectations on both sides.
- On-board your employees effectively
Imagine yourself as a guest, walking into a new hotel – you want to feel welcome, you want to be guided to your room, you want to know enough about the hotel’s facilities to make the best out of your stay, and who you refer to when you have any questions. It is exactly the same for your employees when they start working in your company. Take the time to show them around, introduce them to the team, guide them through their area of work and be open for a multitude of questions. Have them train with a buddy for the first phase to allow for much easier integration into the organization. Training your new employee to adopt the right skills and company culture are equally important in this phase, forming the foundation for your employee to grow within.
- Review performance and recognize it
It is essential to keep an eye out for how each of your employees are doing. High performers should be appreciated, recognized and rewarded – there is no secret recipe to how you do this, the only thing you need to find out is: what intrinsically motivates your employees? This could vary amongst different personality types – the more you are able to motivate them with rewards they care about in formal or informal ways, the more engaged they will be to continue contributing to your hotel’s success. A smile, a simple thank you, a little bonus, a preferred shift… it could be anything you deem appropriate! If you notice that some employees are falling short of delivering on expectations, address the situation and coach them in the right direction.
- Provide lucrative development opportunities
Every employee has a learning curve, and for your employees to advance, they need to know what they can do to reach the next step forward. This is especially the case for generation Y entering the workforce. Are your employees committed to the organization’s goals? Are they performing above and beyond what they need to? Are they ready for a promotion? These are the ones to invest in; give them meaningful opportunities to progress in their career and you will not only show how much you value them, but create a loyal employee for your company.
Overall, to support these four areas of an employee’s job cycle, you need to build a strong organizational foundation that allows for two-way communication and employee empowerment. Respect your employees, let them voice their opinions, allow for their creative solutions to be actionable, embrace any of their mistakes as part of their learning curve, and form a confident, united team that is proud to work at your company.
René, Asim & Thomas also shared some powerful statements on employee retention, which I believe can bring great value to you and your team:
“No one leaves home to do a bad job, employers must connect and grow their employees. Honesty must be kept at all levels of the organization…it is the employer’s duty to live up to the employees’ expectations, and exceed them for better retention.”
– Asim Ibrahim (CEO & Founder of Lakeshore Hospitality Group)
“Give respect to all employees; understand their life situations and their needs, learn to listen, learn to identify talents and then develop them or you lose them. Who wants to grow and has the potential to grow, will grow, if not with you, then with someone else.”
– Thomas Noll (Regional Director Kazakhstan for Rixos Hotels)
“The best approach to retain employees is to let them feel like they are an important part of the organization as an individual. Reward them for their performance and create such an atmosphere that will make them come to work with pleasure and not because they have to earn money. Make fun and do unexpected things. Fun and serious business go very well together.”
– René Wildeman (CEO & Founder of Wildeman Hospitality Consultancy)
The ultimate positive outcome when you’re a valued employer with a high employee retention rate? Less costs associated to employee turnover, an engaged and high-performing loyal workforce, improved employer and brand image, increased customer satisfaction and a more successful business! Are you well on your way to making this happen?
About the author
Samantha Noll (Ecole hôtelière de Lausanne Graduate) forms part of the Business Development team at Novility, a startup developing a number of leading-edge solutions for the hospitality industry. Based in the Netherlands, the team comprises hospitality, design and tech experts. Our first upcoming product, Novility HELP, focuses on modernizing housekeeping training. Find out more at www.novility.com