A wake-up call19 June 2020
As the self-branded ‘Hotel Financial Coach’, David Lund has worked in the sector for more than three decades, collaborating with some of the industry’s biggest brands. During that time, Lund has witnessed a lot of change, but none of it compares with the operational transformations he foresees as hotels begin to reopen.
Having been around awhile, I have seen the changes that have come as a result of major global events. The starkest example is our pre and post-9/11 world. It showed us that the idea of getting on an aircraft means we need to prove we do not have any threatening objects with us, like guns, knives and explosives, and we need to prove we are who we say we are. We must prove we’re not a threat and that we’re on the right security list.
Talk about a big change in the way we travel, as well as the changes in technology and investment. I think the other side of this pandemic will also see profound changes in the travelling world and hotel businesses.
In the past two decades, we have seen the social media phenomenon of service scores and customer rankings of the hotel world, which has had a major impact on how we are perceived by the public. I think, going forward, the same will apply to our cleanliness. The brand and hotels that have the highest cleanliness scores will be in higher demand by the public. I see a boom in the way this information is collected and used.
How we clean our rooms and facilities now is probably not what will work going forward. The public and our governments will demand higher and more transparent cleaning standards. The idea that the same cloth can be used to clean several surfaces in one room sends a chill down my back. Our industry must do better, and perceptions need to change. The brand and hotels with cleaner facilities will win.
Our guests will be demanding clean rooms. We need to come up with a way to guarantee that our rooms are germ-free. I saw a video where a hospital room was being sanitised by a robot using UV. Will our rooms need the same level of sanitation and evidence of the same? Will customers expect this and will our facilities with such abilities be able to charge a premium?
Employers will also need to ensure their employees are healthy before they are allowed back at work. Does this mean that, each day, before we allow staff inside our buildings, that we need to screen them? How will we do this efficiently and what will it cost? Let’s face it, our biggest liability going forward might be what we currently hold as our biggest asset. Staff go home each day and then come back to our guests. How will we ensure they are germ-free?
Touchless everything, like check-ins and guest room doors, is a trend that will only accelerate now. Anything we can do to remove the need to touch surfaces like elevators, TV remotes, thermostats, for example, will be welcome enhancements that are going to separate the best from the best when it comes to clients choosing where to stay.
In terms of measuring hotel performance, the focus will shift from RevPAR index to GOPPAR index. Owners will demand greater transparency and the only way this can be delivered is by comparing the performance of your hotel to a competitive set. Higher RevPAR must translate into higher profits. Right now, these comparisons are possible but, as an industry, we do not embrace this process. The future will demand more transparency, and the hotels and brands that get in front of this will be rewarded.
Our business has always been about providing great service, having engaged colleagues and generating profit. The first has always been visible – great service. Since the dawn of time that has been our mantra. Colleague engagement was a more recent phenomenon that our industry embraced in the past three to four decades. The future belongs to the hotels and brands that drive financial leadership skills into all areas of the operation. Having leaders that know how to manage their payroll and expenses, and flex those against business levels, will be paramount to success. Being the brand that develops its managers financially and creates great financial leadership bench strength will be rewarded handsomely.
I know I do not have a real crystal ball – just my limited view of our world. But one thing is for sure, this is our wake-up call and things are going to change, big time.