Hospitality executives, be honest with yourself: do heavy administrative workloads leave you less time for strategizing? Do slow processes lead to delays in work activities? Are you or your teams still using manual tools that affect productivity and increase the probability of making mistakes?
If you answered “yes” to any of these, then it’s time to start making changes now. That’s because productivity (or lack thereof) is directly correlated to employee labor, and labor is generally the greatest cost for hotels. A 2013 report, for example, found that labor represented roughly 30% of total hotel revenue (newer reports earmark this number at close to 50%). At the same time, reports from the Bureau of Labor show increases in restaurant and hotel labor costs (in 2016, costs rose over 5%) as well as hourly compensation for hospitality employees (which rose 3.6% in 2016).
If there ever was a time for hospitality organizations to pursue productivity, it’s now. Executives today are challenged to do more with less amidst a rapidly growing industry. So, where should they start? Here are five statistics to help hoteliers improve productivity, operations and revenue:
1. 60% of IT departments say they need more than 15 minutes just to identify who should respond to an incident (source)
Overall, 60% of managers think IT support is time-consuming and 48% find it frustrating. Improvements must be made in this area. If your site suddenly goes down, for example, your IT team needs to be able to quickly, intelligently and autonomously find a solution to recover the guest experience and soften the financial blow. Consider Amazon, which lost $66,240 per second when it experienced a site outage in 2013 (surely, the average hotel differs from this digital giant but you get the point).
2. Less than 10% of HR teams have automated applications for employee onboarding (source)
In general, only 15% of organizations have automated systems (even with IT support). On average, managers say they need to coordinate across four departments to bring a new employee onboard.
3. Managers spend two days a week on administrative tasks (source)
Almost half of these managers agree that this administrative work leaves them less time for strategic activities (including revenue growth). In fact, poor administrative task management has been shown to cost businesses upwards of $600 billion per year in lost opportunities. These kinds of tasks can be easily automated to provide an efficient yet consistent approach to managing business enterprise-wide.
4. 9 in 10 managers agree that their productivity depends on how efficiently other departments perform (source)
Executive productivity cannot be determined by the efficiency of other departments. In hospitality, this means executives deploying applications that allow them to manage and track services across different departments—HR, IT, billing, sales—to simplify and streamline processes. If departments use different applications to collaborate, management should work to seamlessly integrate them to enable open communication and collaboration (90% of companies believe the presence of multiple collaboration apps in the workplace makes employees more productive).
5. More than 8 in 10 companies use manual tools (i.e. spreadsheets, emails) for managing work (source)
What’s interesting is that most of these managers see no productivity benefits from these tools at all. In fact, 56% believe these tools actually decrease productivity at their company. Three-fourths are also concerned about errors due to the manual updating of spreadsheets (side note: can you imagine the time it takes to cut and paste spreadsheets and email data into reports?) The solution here would be the use of automated workflow tools that quickly yet securely collect information from multiple data sources. Over 85% of managers believe this kind of automation would make them more productive.
It’s imperative that hotels work to improve productivity and, subsequently, revenue. Overall, research has found that doing so so can more than double revenue for companies compared to those with less productive employees. It doesn’t get much better than that.
Check out this blog for more on optimizing hotel operations and improving employee engagement.