Companies are struggling to improve profitability by cutting expenses, copying competitors, replacing CEOs, and hiring expensive consultants. Unfortunately, most of these efforts have failed to pay off. But a number of hospitality leaders have found a source of competitive advantage. They are leveraging their own employees to find new opportunities for growth.
The notion is simple. ‘Regular' employees are an important source of innovative ideas due to their knowledge of operations and their own creativity. Employees are psychologically and physically close to customers and research has shown they can be very helpful in identifying customer needs and opportunities for innovation.
Two of the ways hospitality leaders are driving top-line growth with their employees are employee crowd sourcing and employee engagement programs. These initiatives not only can uncover great ideas, but also serve to advance productivity and employees' emotional connection with their work.
Employee Crowdsourcing
Crowdsourcing is a buzz-word we're hearing a lot lately, although the idea is not new. Writer Jeff Howe coined the term in 2006, and defined it as "the act of taking a task traditionally performed by an employee or contractor, and outsourcing it to an undefined, generally large group of people." Today's technology advances this notion and gives us unprecedented access to the brilliance of others. There will always be creative geniuses, but now we are less reliant on the rock stars.
In the last few years, businesses have begun to follow suit. Crowdsourcing has become a very hot topic in the boardroom, and has spread into all areas of the company: financing and fund-raising, strategic direction, research and development, quality testing, and marketing.
Companies now crowd source solutions by going directly to the public or to their own employees. For example, BMW created an online "Customer Innovation Lab" for the purpose of enlisting their customers to help create new ideas for services. Starbucks introduced "My Starbucks Idea" for employees and customers to share ideas (Mocha Peanut Butter Cup Frappuccino?).
Turning to employees for assistance enables companies to leverage the talent they have on hand, which can save a lot of money. Four Seasons Hotels and Resorts' new company-wide innovation program, BLUEWATER, equips 35,000 employees with tools and behaviors needed to ideate, pilot, and refine guest experiences. BLUEWATER sources and pilots ideas through general managers, while also soliciting fresh solutions from elsewhere within the company. They have incorporated this program into all general meetings and staff training. And it's working. In a video presentation to staff, a Four Seasons housekeeper in Hong Kong said: "Before BLUEWATER I would go into rooms to make sure they're clean. Now I look for opportunities to wow."
Involving employees in service innovation and design also increases the likelihood of new service success because employees can identify the organizational issues that need to be addressed to support the delivery of the service to customers. And when employees feel that management is interested in their opinions, they'll be more likely take a personal stake in the business. They'll go from feeling like they're working for the man to feeling like they're a part of the team.
To improve productivity Hilton Worldwide adopted Microsoft SharePoint to connect Hilton employees and business partners at more than 3,600 properties around the world. Employees benefit from having better access to information, the ability to quickly and easily locate subject matter experts, and improved collaboration and information sharing among geographically dispersed work teams. The goal is to empower employees to improve the guest experience and brand loyalty. Hilton encourages innovations not just with bold, breakthrough ideas, but also through constant improvements and streamlining ideas to make something better for their staff and guests.
Employee Engagement Programs
Forward thinking companies understand that engaged employees are created, not recruited and that it's the company's job to engage employees. More hospitality companies are making their businesses more efficient, more attractive, and more profitable through new approaches to employee surveys.
In the old days, soliciting feedback from employees meant putting a box marked "suggestions" next to the water cooler. Although the idea is the same, new technologies to engage more people in the process, and new approaches that pinpoint the key issues impacting employee morale and productivity, are encouraging more best-in-class employers to use employee opinion surveys to generate positive changes from within. Today more hospitality companies are making their businesses more efficient, more attractive, and more profitable through new approaches to employee surveys.
For example, several years ago Tropicana Las Vegas was slated to be torn down. Four changes in ownership had left the property in disrepair and bankruptcy. Employee motivation was also at an all-time low, negatively impacting the guest experience. By measuring employee engagement, and specific sources of frustration, management was able to address root causes of employee dissatisfaction and begin building a strong service culture. Today, Tropicana's employee enthusiasm has become a hallmark of the Tropicana experience, and a key driver of guest satisfaction.
Another company, Joie de Vivre, has used employee surveys to substantially impact their business. By linking employee satisfaction data with guest feedback, Joie de Vivre discovered one critical factor that moved the guest feedback needle more dramatically than any other. When performed well, it drove guest satisfaction up, and when performed poorly drove guest satisfaction down. Joie de Vivre's culture, reflected in its employees and the guest experience as ‘can-do attitude,' is what had the greatest impact on guest satisfaction and loyalty.
Because they know which levers drive employee engagement and customer loyalty, they have also been able to accurately calculate the business value of their culture. By increasing employee commitment and strengthening guest loyalty, Joie de Vivre determined their unique culture contributes more than $14m to the bottom line each year.
Both Tropicana and Joie de Vivre discovered that the fastest way to improve customer satisfaction and business performance is to engage employees. Outmaneuvering competition in the hospitality industry requires both innovation in processes to improve service productivity and innovation in offerings to increase revenue.
Measuring the Emotional Connection
Employee engagement is the emotional commitment the employee has to the organization and its goals. This emotional commitment means employees actually care about their work and their company. They don't work just for a paycheck, or just for the next promotion, but work on behalf of the organization's goals. Emotionally committed employees can have a huge impact on your business.
Understanding employee emotions is critical to getting the best from your employees. The Market Metrix Employee Emotion Scale was created to reflect the spectrum of emotions experienced by employees in hotels and casinos. Based on this research, 12 emotions were selected for the final scale. This is the first time this scale was used to evaluate the connection between employees' workplace emotions and employee loyalty.
Of the 12 key emotions, employees who reported feeling "powerful," "appreciated," "proud" and "important" at work were more likely to remain loyal employees. Feeling powerful was the strongest overall predictor of high employee loyalty. Loyal employees were 46 percent more likely to report feeling powerful at work compared with non-loyal employees. In focus groups, front-desk personnel described how their work makes them feel powerful, including, "I've been told to make whatever decision I need to," and "I like the power of being almost on my own." Many employees were annoyed by policies that diminished their control over solving problems for guests, such as being forced to get a manager's approval to give a guest a discount. One executive housekeeper commented, "I want to be able to do things myself. If I see a bathroom that really needs caulking, I don't want to have to rely on engineering to fix it."
It is interesting to note that the top four emotions that predict employee loyalty all are linked to an employee's sense of stature. Loyal employees report feeling appreciated 30 percent more often than non-loyal employees. Loyal workers often commented about their supervisors thanking them for their good work. Employees reported that their sense of appreciation comes not only from supervisors, but also from guests. For example, hotel employees from several departments agreed, "It's nice to work for guests who know your name."
Feelings of pride and importance also scored high among loyal employees. Loyal employees were 29 percent more likely to feel proud and 28 percent more likely to feel important. Employees often commented about how important it is for them to feel proud of their workplace, especially its appearance. Loyal employees frequently made comments about the appearance of their hotels and often stated that they feel upset when facilities are neglected.
Remarkably, "happy" ranked only seventh of the 12 emotions studied in its ability to predict employee loyalty. This finding supports a belief held by many that the star performers in the hotel industry are not necessarily those who describe themselves as most "happy" at work.
While this research demonstrates that employees' sense of power is a strong driver of loyalty, it also indicates that this emotional connection is relatively uncommon (reported by 64 percent of respondents versus 81 percent average for all emotions). Hotel management would do well to consider ways to improve employees' sense of power because it is an effective and relatively untapped way to improve employee loyalty.
Innovation puts companies on the offensive. While other brands can add products and services simply to match competitors, hospitality companies that develop new products and services often lead their respective markets. To remain competitive in the hospitality industry requires both innovation in processes to improve service productivity and innovation in offerings to increase revenues. Almost every competitive business today is looking for innovative ways to accomplish both of these objectives.
About the author
Dr. Jonathan Barsky, Ph.D. co-founder and partner of Market Metrix, is a professor of marketing at University of San Francisco's School of Business and Management and an internationally known consultant and lecturer in the area of customer satisfaction. Professor Barsky is the author of two bestselling books, World Class Customer Satisfaction and Finding the Profit in Customer Satisfaction, and has published more than 100 articles on the subject. His current work on customer satisfaction, including his pioneering work on consumer emotions, has won numerous awards and has been incorporated into the curricula of U.S. business schools. In his role as Vice President of Research Dr. Barsky oversees research and development activities at Market Metrix. This includes the development and direction of research aimed at improving current products and generating ideas for new products and services. He also works closely with customers to review and use existing customer insights to aid in innovation. Dr. Barsky can be contacted at 415-721-1300 orjbarsky@marketmetrix.com Extended Bio…
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Source: Hotel Business Review
