15 Aug 2014

Leadership mentoring – what’s most important

Leaders, Operations Comments Off on Leadership mentoring – what’s most important

According to a benchmark study in 2012, US companies alone spend almost $14 billion annually on leadership development with the cost of customized offerings from top business schools reaching upwards of $150,000 per person. No one can doubt that it’s important. But molding the next generation of hospitality leaders (keeping this price tag in mind) is far easier said than done.

There are lots of tricks to develop and coach leaders without spending excruciating amounts of money, as highlighted in a recent article, “Why Leadership Development Programs Fail” by Pierre Gurdjian, Thomas Halbeisen and Kevin Lane. You start by choosing only those individuals who possess the most essential capabilities for business success such as strong decision making or coaching skills. Then, you have to match specific traits to the current context, ensuring that the cycle of leadership and mentorship is completed in real time with real work.

Beyond this, I sat down with a hospitality consultant, Stephen Darling, who has focused on leadership mentoring to touch on a few more points.

Stephen Darlin

Define leadership mentoring

Leadership and mentoring are two different things – with leadership being the overall concept and mentoring being a key tactic. It was Plato who first questioned, “What qualities distinguish an individual as a leader?” The salient question is whether leadership is hereditary or learned: the answer most likely being both. The reason we so often combine the two is that we expect the ‘leaders’ in hotels to coach the team on being great leaders – and do so through mentoring.

Where did this concept stem from?

The saying ‘Manage by Walking Around’ is no longer enough. I prefer the concept developed by David Morgenthaler of ‘Manage things, lead people’. Yes, MBWA is part of the process that includes mentoring, effective delegation, development and teamwork, but without active engagement and leadership by the senior individual, it just won’t happen.

What’s the immediate application for millennials?

I have been approached by an increasing number of recent graduates and recruits – all of whom are disillusioned or disappointed by the current market in finding a position that they feel excited about. Organizations and senior leaders simply don’t make enough time to meet with and listen to the next generation of talent. In turn, they become increasingly detached from what young people want and need, let alone how their organization could benefit from our next tranche of customers. Each time I meet with young people starting out in their careers, I learn something and connect with tomorrow.

What applications does leadership mentoring have with those who are not yet leaders?

Enough research has been done on leadership skills to now understand that effective leadership can indeed be learned. Though, ideally, this is combined with an innate sense of how to motivate and communicate with others.

Has Leadership Mentoring been a part of chain hotel management at the corporate level?

It used to be, but as the economy and markets have materially impacted hospitality organizations, that seems to have gone by the wayside. Succession planning, let alone retention of the best employees, is at risk. http://g7hospitality.com/leadership-mentoring-whats-important/ http://g7hospitality.com/leadership-mentoring-whats-important/For this, I love the saying, “Great companies recruit the best talent, even before its needed.” I consider leadership to be one of the most important disciplines for the success of organizations over the next decade, if not beyond. It needs to be taught in colleges and universities as well as become a part of the framework of training programs for those entering the hospitality industry.

Copyright Larry Mogelonsky of LMA Communications

15 Aug 2014

Crisis Communications – New World, New Mandate

Operations Comments Off on Crisis Communications – New World, New Mandate

Are you sure you know how you will handle a crisis should it arise at your hotel? Now is the time to make sure.

Almost every day we watch a crisis unfold on the evening news. We review how it was handled and make judgments on how those responsible performed – good, bad or indifferent. Are you prepared for the crisis coming your way? How will you be judged?

A crisis, by definition and by everyday experience, takes on many shapes and forms. But in a business context, it most pronouncedly consists of any situation where human life or property is in peril or when any organization, business or brand is at risk for misconduct or customer breech. Issues are not necessarily one in the same with every crisis but they can often become such if not properly managed. Suffice to say, “You will know crisis when you see it,” is a fair prognostication for any organization and its management.

It is for these very reasons that Crisis Management and effective Crisis Communications is absolutely vital. No matter how small the organization or business, no matter how remote its chances for crisis, it is socially and economically irresponsible to not be ready. In fact, a strong Crisis Management/Crisis Communications plan is the best way to minimize revenue loss and avoid liability and legal consequences.

To put this in perspective, let’s look at a real life example:
When a storm of epic proportions hit and crippled an entire city, a major hotel centrally located downtown was impacted like everyone else, but with auxiliary power and some in-house staff it was able to continue limited operation. It was essential to quickly communicate its status and help manage the crisis by providing accommodations to first responders, key officials and the media.

The property had a strong Crisis Management/Crisis Communications plan in place which they were able to activate immediately. With the help of a crisis communications expert, the implementation of the plan was seamless and vital to the storm response. Contact with proper officials, the media and others – as laid out and prescribed in the plan – assured knowledge of the limited operating capability at the hotel and its ability to provide residence for mission critical guests. Effective media contact not only conveyed accurate news about the hotel’s situation, but also resulted in housing the media and setting up locations for on-air reports and coverage.

The framework of a Crisis Management Plan allowed the hotel to function instantly and properly in the face of what it confronted. Guests had been informed and securely evacuated before the storm, and after the storm essential guests were safely received at the hotel. National news coverage not only reported the overall condition of the city, but also the role that the hotel was playing in the aftermath. The hotel was complimented across the board rather than criticized for any confusion or labeled insufficient. The GM said, “The crisis plan and the fact that we had actually practiced it in advance put us in a better place than almost anyone else in the city.”

While larger, more complicated organizations and companies may require a crisis plan of substantial scope and scale, for the most part an effective Crisis Management/Crisis Communications Plan can be and should be brief and very workable. Basically, it needs to consist of identifying all the right people who need to be involved and bear responsibility as well as all of the necessary activities that need to be conducted immediately. Also, essential to the plan and process is messaging and audience, with a special emphasis on media. Development of the plan should begin with the proper level of executive authorization, identification of key team members, an assessment of the organization’s primary areas of crisis and issues risk, and the selection and assignment of the work team to execute the plan. Outside experts and advisers can speed the process and the quality of the plan based on their creation of other plans and their real-time experience in handling crisis and issues. Regular updates, training sessions and selection of organization spokesperson(s) is a critical part of the plan’s implementation and management. To develop a plan without ever practicing or testing it is a foolish use of time and budget.

There is an expectation and mandate today for organizations of all sizes and shapes to have at least a minimum Crisis Management/Crisis Communications Plan in place. It is among the strongest components to minimize revenue loss, avoid protracted legal and liability issues, and restore the organization to business as usual and good customer confidence as quickly as possible. Brand and image are always among any organizations most valuable assets. The Crisis Management/Crisis Communications Plan underpins the protection of those assets.

Copyright Roger Conner of G7 Hospitality Group

23 Jul 2014

Service Excellence From The Inside Out

Human Resources, Leaders, Operations Comments Off on Service Excellence From The Inside Out

How do you define service excellence in your company? Here’s how you can judge if you have the right corporate culture in place to facilitate greatness.

It seems like there has been a lot of chatter recently about the service priority and why service is the difference maker. Or maybe this is just my imagination and the chatter is always present. In any case, I have my own opinions and wanted to add to the chatter.

Service excellence is about delivering to the customer expectation, and then meeting and slightly exceeding that expectation. Notice I said “slightly exceeding” and I say that because if you go above and beyond, you begin to create a customer expectation you can’t achieve without negatively impacting other priorities.

Service excellence and customer expectations vary by brand and by hotel type – select service vs. full service, commercial vs. resort, luxury vs. economy, country and culture and so on. As the operator, it is your responsibility to understand the brand promise in regards to service and the related customer expectation. You need to find the right balance between meeting and exceeding the customer expectation while also being true to the integrity of the brand. This includes creating a positive work environment for your team as well as meeting and exceeding profit objectives.

Clearly a delicate balance, but for those who get it right, you ensure the long-term success of your property. You have happy customers who will return; the brand is happy; you will continue to be employed; the owner is pleased with their returns and they will continue to invest back into your property.

It all sounds very simple in theory. So how do you make it happen? Let’s assume that 50% (probably high) of your employees interact with your customers on a regular basis. That means that the other 50% of your employees only interact with other employees, and yet we frequently neglect or underestimate the significance of the employee interactions. Therefore my step philosophy of ‘from the inside out’:

1. Hire based on attitude, not experience. Experience helps, but you can teach skills and gain experience. You can’t teach attitude.

2. Attitude is just as important in the back of the house as it is in the front of the house. A positive attitude from the back to the front of the house will get you headed in the right direction.

3. Begin your training in the back of the house with as much focus on customer/employee interactions as skills training – more focus on engagement and motivation. The customer of the back of the house employee is the front of the house employee.

4. Train your customer contact employees to understand and respect the role of the back of the house and how their success depends on the back of the house.

5. Provide customer interaction training for your management employees. Don’t assume that just because they have a title that they have the appropriate customer skills.

6. Develop recognition and/or incentive programs that equally reward front-of-house and back-of-house employees. Don’t allow your programs to create a two-class society within your property.

7. Ensure that your organizational structure is designed to facilitate internal communications between departments. Watch for ‘silos’ and break down the barriers.

8. Mistakes – own them and accept responsibility at the highest level. Make sure this is the mantra at all levels within your organization. It starts at the top and by example.

9. Empower your employees to solve problems and recognize or reward success. Don’t gauge success or failure based on the cost of the associated rebates. The value of keeping that customer far exceeds the cost of the rebates. Remember the last thing your customer wants to hear is ‘let me check with my manager’.

10. Problem resolution – set a standard to exceed customer expectations. Studies show that when your problem resolution exceeds the customer’s expectation, the customer’s intent to return is the same as if they never had a problem. If an employee goes beyond a reasonable standard, treat it as a training opportunity, but say thanks first.

Start from the inside out and create a solid foundation. http://g7hospitality.com/service-excellence/ http://g7hospitality.com/service-excellence/How often have you found that the root cause of a customer problem can be traced to a back-of-house failure? Make sure you’re hiring practices, training, recognition programs, compensation plans, empowerment philosophy and workplace environment efforts are equally balanced across all employees and the management team.

The key to success is in attitude and desire to achieve excellence. And for that, you need a solid foundation, so start from the inside out!

Copyright Chuck Kelley, Principal & Co-Owner of G7 Hospitality Group

23 Jul 2014

A Food & Beverage profitability road map

Food & Beverage, Marketing, Operations Comments Off on A Food & Beverage profitability road map

Food and beverage is an area of hospitality that I consider integral and yet it comes with a lot of unpredictability. That’s why it’s always good to hear from current and former F&B Directors to decipher how they managed and succeeded in this volatile field.

To this end, I’ve recruited Sean Handerhan – a former Director of Food and Beverage Marketing at Marriott for 17 years – for a discussion on the topic. Of note during his tenure, Sean helped implement the first branded pizza program for this chain as well as initiating the development of The Gourmet Bean, a multifaceted coffee concept that has been installed in over 100 locations. Throughout this time, Sean has led multi-discipline teams to improve hotel restaurant operations by applying customer research, developing facility layout changes and redeploying staff to heighten guest satisfaction scores.

Why is F&B often labeled as the least profitable segment of the business?

Each of the components has more variable cost components than other areas of a lodging facility. Food costs can vary greatly over a relatively short period of time. Demand for the services (in restaurants and bars) is usually more unpredictable than rooms operations and therefore results in higher than ideal labor costs.

With rare exceptions, F&B is viewed as something of a costly amenity – something that is necessary in a hospitality operation, rather than a free-standing, locally-focused enterprise. Frequently this area lacks a defined plan of what the F&B operations should be – who are the customers and what is the competition? A well conceived plan will help identify ways to be more efficient with both labor and food cost without sacrificing quality or brand position.

Is there a way to look at F&B systematically to quantify lagging areas?

Most definitely, and that is what the G7 Food and Beverage Road Map is designed to do. Our approach is a structured one that looks at the operation as a whole, the market in which it operates and its business potential. Plus, this system determines realistic, prioritized solutions that can be executed without extensive capital investment.

How do accountability and responsibility come into play?

We look for instances where labor is being deployed inefficiently, including the level of support and supervision that is provided by management. Generally, it is not realistic to assume an F&B operation in our client’s properties can operate with a hierarchical management structure. The key is to define a flatter team structure, and then use the tools in place to push responsibility, authority and accountability to the front-line staffers, while also giving them a vested interest in the performance of the business.

How do you develop a program that quantifies service excellence?

The simplest answer is in covers and customers. We’d suggest that excellence is best defined as customer satisfaction and perceived value for the money – rather than elaborate fussy service procedures. In order to model service excellence over time, training processes and educational support must evolve, plus be regular and ongoing. Better-trained staff should be able to sell the products better and in doing so, create a win-win for the client and the customer.

What about staffing, menu design and job responsibilities?

It starts with a realistic assessment of the optimum potential from the existing physical plant. That helps dictate what limits are placed on the menu. Next, what is the ability of the staff to learn multiple functions? This breaks down barriers that may currently exist. It is important that there is shared responsibility and accountability between the front and back of house teams.

Give us a case study of where you have seen marked improvements in F&B profitability through a comprehensive focus on these fundamentals.

Often we see menu creep, denoting when the scope of a menu keeps growing and yet nobody steps back to look at the whole to ensure that it reflects the intent, potential and viability of an outlet. There was one instance where my client had two outlets side-by-side, both serving virtually the same menu yet one had a food orientation and the other beverage. I closed one and combined the parts into a more dynamic space, which we could then afford to redo. The empty space is now on the market to lease out and the costs to ‘open the door’ in the second outlet have been eliminated.

I can also share a case in which we focused on the breakfast meal period as it was the most important meal for the transient guests in the hotel. We spent a week sitting in the restaurant at various times throughout the morning to observe the roles staff and management played. We found the outlet had become buffet driven to lower labor costs, but the waste and quality of the food had gotten out of line. There were hosts who seated customers but didn’t facilitate taking their orders. We found service staff spending too much time in the kitchen doing cold food prep and therefore unavailable to guests. We found coffee poured into thermoses and placed on the tables at the beginning of the shift because coffee couldn’t be made in small batches.

Our solution? We eliminated the host positions and encouraged wait staff, with manager guidance, to seat the customers to facilitate an earlier ordering process. We instituted a pager system that called the service staff to the back when their food was ready. We worked with our coffee supplier to provide new brewing equipment and station it in the restaurant. http://g7hospitality.com/food-beverage-profitability-road-map/ http://g7hospitality.com/food-beverage-profitability-road-map/We moved kitchen staff to act as an omelet chef on the buffet, who produced more food to order and reduced food waste from uneaten buffet food in chafing dishes. The result was lower food cost, better food quality, quicker service and food staff cooking the food instead of service staff.

Copyright Larry Mogelonsky of LMA Communications

 

11 Jul 2014

Service, Profit or Both?

Operations Comments Off on Service, Profit or Both?

Here’s how to balance that fine line between customer satisfaction and making money.

Most commentary on service excellence expresses some or all of these themes: exceeding customer expectations, anticipating guests’ needs, being responsive, creating the impression that someone cares, memorable moments, the difference is service, and so on. I couldn’t agree more, but it is very difficult to measure the impact of these themes in a vacuum. Yet at times it seems that it is all about the service and that other priorities will take care of themselves.

In the past, I discussed the fact that service expectations vary by hotel and customer as well as by other conflicting priorities. Let’s examine a few facts regarding hotel types and available resources:

  • Select-Service: A rooms product with limited F&B and other amenities. These properties typically operate with .5 of a Full-Time Equivalent (FTE) per available room and a handful of managers/supervisors.
  • Full-Service Commercial: Guestrooms, restaurants, lounges, function space and so on. These properties typically operate with .8 to 1.0 FTEs per available room and, depending on size, 20 to 30 managers/supervisors.
  • Resort: Depending on the level of amenities – mainly F&B, Golf and Spa – these properties will typically operate with 1.2 to 1.4 FTEs per available room and 30 to 40 managers/supervisors.
  • Luxury: Potentially all of the above plus a Guest Services Department with management staff. These properties will typically operate with 1.5 or more FTEs per available room and 40 to 50 managers/supervisors.

(Please don’t hold me the numbers or exacting product descriptions, but for the purposes of this discussion they are in the ball park.)

The other reality is the level of experience and seniority of the personnel at these different types of properties. The higher you go up the food chain the more seasoned and capable the team is. The point being is that you simply can’t deliver similar styles and levels of service across all hotel types. Nor do you want to; you simply won’t have the same resources or experience levels.

Secondly, in this asset-light environment the operator is charged with balancing the priorities of the brand and the ownership, which in simple terms are:

  1. Brand: The brand company wants to maintain the integrity of the brand, maintain loyalty of the brand’s customers, maximize their fees and continue growth.
  2. Ownership: Ownership is more interested in cash flow from operations and return on investment. The question is: do they want sustained profitability or a short-term boost so they can flip the asset?

To be successful, the operator must understand his or her customer expectations, consistently meeting and slightly exceeding those expectations – never below and never too high. Operators must balance the conflicting goals of ownership and the brand by providing just the right level of service so guests continue to come back and provide good cash flow to ownership, which should therein encourage owner’s to reinvest in the property and the brand.

Picture the select-service hotel that decides to add room service to compete with the full-service hotel down the block. How about the full-service hotel that cuts back on the bell staff to improve short-term profitability? Or the luxury-tier operator who is so focused on being an ‘hotelier’ that they miss the profit motive.

In the early days of brand segmentation, this type of behavior was prevalent and it still exists today, though in more subtle forms. This is also why an up-and-coming manager in a full-service hotel may not transition well to a select-service hotel or vice versa – at times they have difficulty leaving the values they learned growing up behind.

The reality is that the customer you brought over from the select-service to the full-service model by manipulating service offerings and reducing prices is not really your customer. Sooner rather than later you will need to go back to the status quo and you will quickly lose that customer who was there on false promises that weren’t true to the brand. You are far better off focusing on the consumer segment attracted to your hotel type, building a strong foundation of loyal customers as a result of consistently staying true to the brand promise and meeting expectations.

No matter what type of hotel we operate, we have to deliver the basics well and add to the service delivery relative to the customer expectation and brand promise. You really can’t expect the select-service staff to anticipate guest needs or create memorable moments – just the basics please. At the full-service commercial hotel, you have a few more facilities available, but in reality your prime customer – likely the business traveler – wants the basics and responsiveness to special requests. At a resort or luxury-tier hotel, customized service delivery to individual needs and making the customer feel special are the factors that will create value.

At the end of the day, we all need to remember we are running a business. For the business to run successfully over the long-term and for you to stay employed, you need to meet customer expectations, keep the brand integrity in line and maintain strong cash flow to ownership. The operator’s job is the most difficult; it’s a balancing act and it can be a steep drop in either direction if you step the wrong way. http://g7hospitality.com/service-profit-both/ http://g7hospitality.com/service-profit-both/Service excellence is an integral part of your success and it can be the differentiating factor. The point is that you can’t win with service alone; you have to get the other parts right as well.

Copyright Chuck Kelley, Principal & Co-Owner of G7 Hospitality Group