Room occupancy is expected to be high again in 2019, but room rates aren't growing as much due to an excess of new supply. This means you've got a whole lot of guests in your city hotel asking for a whole lot of things but you're not getting substantially more money for the rooms. And this means that your staff are working extra hard to keep up, but you're probably not paying them any more than you were last year because who can afford it without more room revenue to draw on. Further, you likely have one of the highest turnover rates in the industry.
So when we say love the one you're with, we're not talking about your guests. You have zero control over who walks in the door to stay the night, but you have tons of control over whom you hire to keep your hotel running. Most hotels focus so much energy on the guest that they overlook how to keep their staff. The turnover rate in hotels is an astounding 73.8%; it should be in the 10-15% range (DailyPay). Three quarters of staff will leave this year. It's an expensive problem to have.
The costs of losing employees pull from many areas of the business, including poor customer service when employees disengage, higher recruiting costs, lost training costs plus the training expense of a new person, and the ripple effect of productivity problems for remaining staff as well as the viral spread of negativity that can happen when dissatisfied employees start grumbling. Just one unhappy employee is a big expense.
So, apaleo's a property management system. What do we have to say about employee retention? In other words, what does your PMS have to do with staffing? It's a two-fold issue, which is a bonus because it means you can have double the impact. The first impact is in retention. The second is in training and usability.
A frequent refrain these days is that good technology will keep staff focused on the guest, improving customer service metrics. This is totally true. But better core technology will also make for happier staff. When your hotel is filled up with children who've spilled syrup on every table in the dining area and the adults are all overwrought from either too much sightseeing or too much family time (or both), your staff is maxed out, too. They need to be able to do their jobs expediently. Cumbersome technology—whether it's a slow-loading legacy system or a subpar user experience—decreases job performance and satisfaction. Especially for front-of-house staff, an easy-to-use PMS can make or break their ability to do their jobs successfully, and for everyone else, the PMS must integrate fully with all other core systems to reduce time toggling between systems and/or manually handling data transfers.
We can't overstate the importance of retention for the lean limited-service sector. Data analysis by the Center for American Progress has shown that when an employee making $50,000 or less exits, the organization will spend around 21% of the position's salary to replace him (StandDesk). And that's just the out of pocket expense. While technology alone won't keep an employee, good technology will contribute to an overall more productive and more satisfied employee, who will hopefully be paid accordingly and incentivized.
So you work on retention through technology improvements and, perhaps, some workplace adjustments or a benefits analysis, etc. But with the hospitality industry's staff attrition history, your hotel won't get to 15 or 20% for a long time, if ever. Training will always be a necessary focus for hotels, but it doesn't have to be a pain point either. In developing software, many hotel technology companies have overlooked how important a super-quick onboarding process is for hotel staff. We mean that your employees should be able to pick up a new core technology in a matter of minutes. Complicated technologies are inadvisable and altogether unsustainable when you have digital natives, who have been served up the savviest, easiest-to-use interfaces their entire lives, coming to work for you. And they just aren't necessary. The PMS may handle complicated processes but using it shouldn't be complex.
If you can't be with the one you love...
Then spend time thinking about those you're with. Those you've chosen to run your hotel. Though the correlation between technology and employee satisfaction may seem loose, it's not - especially as new generations enter the workforce. Take a minute to survey your staff about their feelings toward your technologies. What are their pain points? What works? These are valuable insights that will ultimately help you keep them working with you longer. Solid technology can't make up for lower-than-average wages or a bad manager, but it can make the difference of keeping several employees on board longer simply because they are both less frustrated and better able to do their jobs.
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Margaret Ady is a co-founder of apaleo, responsible for the company’s brand positioning, marketing, and strategic growth. Prior to apaleo, she led marketing for Berlin-based SnapShot, and prior to that, for TrustYou. In 2016, she was awarded HSMAI Europe’s Top 20 Extraordinary Minds in Sales, Marketing and Technology. Before joining the hospitality technology scene, Margaret held key leadership roles at The Walt Disney Company and The Oprah Winfrey Network. Margaret has also provided research, branding and marketing consulting services to many companies, including 20th Television (Fox), Nielsen and Red Bull. Margaret graduated from the University of Southern California with degrees in Economics and Psychology and a focus in business. During her studies, she was awarded the USC Annenberg Communications Critical Pathway Grant for her research in new technology and its impact on healthcare decision- making.