Invest in human capital during difficult times

(GA 2010)

How many times we have met and talked at length about market position, use of new technology, attractive advertising, segmentation management, distribution, source of business and other revenue generating opportunities.

But after all those meetings and the discussions, the one overriding factor that comes into play in our industry is how an organization deals with its employees especially during difficult times.

How the employees are motivated, trained, evaluated, promoted and most importantly how an organization can ensure that the interaction between its people and customers can create those memorable experiences that we as an industry, strive for.  It is a fact that customers are not motivated to come back to a hotel because of a new physical product in the room but they return because of the special attention they received from one of the employees.

During difficult times the industry tends to cut on employees related programs like trainings, employee surveys and the overall human resources functions to see where costs can be reduced.  This is extremely dangerous as by taking this approach the memorable customer experiences will disappear.

Soft periods / recessions are the best times to invest in people and ensure that staff are motivated and fully engaged in exceeding customers’ expectations and good organizations realize that this is a great opportunity to provide that unforgettable experience and have those customers return time after time.

This type of investment doesn’t cost very much, especially when you look at the cost of a non-returning guest or the cost of uncontrolled turnover or even worse layoffs during soft periods and rehire when business improves.

This is the perfect time to heighten the focus on service delivery which means knowing what your employees are thinking and perceiving, making sure they are well trained and motivated and that you are doing all that is necessary to ensure an engaged team.  Not only will this approach pay off during the softer periods, but will pay very high dividends when the markets improve, as the ups and downs in our industry come very regularly.

Yes during this time we need to look at cost overhead but reductions on the human area is the very last place where a smart executive should look.  For a healthy future this area calls for continuous investment.  Manager should know this and employees should know this and provide those memorable customers experiences, good productivity and efficiency that ultimately will relate to optimal profitability.