Cultural Alignment in the Hospitality Industry: Labor Retention and the Guest Experience

Hospitality is an industry that thrives on the human touch, offering comfort, luxury, and a place to call home, even if just for a night. The sector's unique blend of service, atmosphere, and amenities requires an equally exceptional and dedicated workforce. Cultural alignment among this workforce holds important implications for productivity, labor retention, and most importantly, the guest experience.

The Burning Challenge for Hospitality Leaders

The landscape of hospitality remains marked by intense competition. The surge of post-pandemic travel and the sophistication of technological solutions have revolutionized the concept of the guest experience. In response, hotels, and resorts race to innovate, investing in state-of-the-art facilities, curated services, and bespoke technologies to elevate their product offering and deliver that increasingly elusive 'wow factor.'

In this age of innovation, the backbone of operational success cannot be overlooked -- the workforce. Defined by its transient nature, the industry endures an alarmingly high employee turnover rate, reaching an annual range of 60 to 120%.

A study by Gallup found that nearly 80% of employees across industries are not engaged in the workplace. The hospitality industry is no exception. Working in hospitality has?unfortunately?become associated with?instability, training gaps, and a lack of career development.

The Impact of Turnover on Organizational Performance

High turnover represents a significant financial strain in any industry, bringing with it recruitment costs, onboarding expenses, and productivity loss during transition periods, but the implications stretch beyond the balance sheet. Hospitality employees are crucial to the guest experience. They are the first line of contact. Their interactions influence the perceptions of the brand and the overall customer experience. High turnover not only costs the organization money and time, but also the loss of employees who can be perceived as cultural ambassadors of the brand.

This can send a ripple through the organization that affects culture, productivity, and service quality. It fragments teams, disrupts momentum, and dilutes institutional knowledge. It is also reflective of a disengaged staff, and a disconnection between individual aspirations and the organization's mission.

Unlocking the Power of Employee Engagement

Hospitality owners and operators are increasingly recognizing the value of employee engagement in combating the spiraling turnover rate. Actively involving staff in operational decision-making, sustainability initiatives, and technology adoptions fosters a culture that takes collective ownership of outcomes and shares victories.

Employee engagement is not a product of chance—it is meticulously engineered through management. Active management can be achieved by allocating work strategically, maintaining open lines of communication, creating clear guidelines, and solving problems proactively instead of reactively (also known as firefighting). Instead of policing performance, front line and middle managers are viewed as allies by their teams, removing roadblocks and facilitating success.

Developing Loyalty Through Employee Development

Lack of employee development and growth have been identified as one reason for the high turnover in hospitality. Training and development initiatives represent an investment in an employee's future with the organization. Whether it is leadership training, cross-functional courses, or personal development programs, these initiatives signal that employee growth is integral to the organization's success.

In a recent survey, 87% of millennials identified professional and career development opportunities as significant in their job search criteria. The hospitality industry, renowned for its diversity of roles and career paths, is uniquely poised to cultivate loyalty through such development opportunities.

According to Ghani et al., hospitality establishments rely too much on traditional retention strategies to keep employees. HR practices should be standardized in terms of compensation management, recruitment and training, development programs, and performance assessments. This not only improves employee performance, but motivation and satisfaction within the organization.

The pandemic has also drastically changed the workforce, in terms of employee values - specifically, flexibility and work-life balance. This can be difficult in a labor-intensive industry such as hospitality. Implementing automation tools such as self-service options or online-booking systems can improve efficiency and help employees focus on more fulfilling tasks. While these tools are often used to improve the guest experience, they can also be used internally to manage employee scheduling.

Aligning Culture from the Top

In the unique and ever-changing world of hospitality, few organizational priorities are as crucial as cultural alignment. The harmonization of culture and guest expectations is an ongoing endeavor, characterized by vigilance and adaptability. This initiative must come from the top.

Implementing dynamic management practices can help improve operational efficiency and cultural alignment. By actively engaging in day-to-day operations, managers can effectively monitor and address challenges in real-time, ensuring smooth and efficient service delivery. This hands-on approach allows managers to identify opportunities for optimization, streamline workflows, and implement best practices to drive operational excellence and cost savings.

Moreover, dynamic management promotes a culture of employee empowerment and development through ongoing training, coaching, and feedback, resulting in a more motivated and skilled workforce and increased employee retention.

Culture, Retention, and Excellence: A Triad of Success in Hospitality

Cultural alignment in the hospitality industry translates to elevated guest experiences, diminished turnover, and fortified organizational performance. A well-aligned culture creates a ripple effect across the workforce, where employees are not just transactors of the service, but enthusiastic advocates of the brand. It infuses loyalty, nurtures talent, and communicates the organization's commitment to service excellence.

By Ryan Zarb , Vice President & Partner of Carpedia International