Travel & Hospitality
Travel & Tourism is an $8 trillion industry sector that represents 10% of global GDP and 20% of all global net jobs created in the past 10 years. It is an industry that, like many others, has been transformed by and forced to adapt to the integration of technology, especially when it comes to digital strategy and mobile devices.
Today’s consumer views his or her mobile device as ‘Central Command’ where all the tools one needs are at-hand. Consumers want to manage as much of their lives as possible through the device – airline, car and hotel bookings, check-in/check-out, restaurant reservations, transportation, retail purchases, exercise regimens and more. Disruptive tech companies offering consumers expanded freedom and choices are here to stay, and more innovation is coming.
OUR WORLD TODAY
Of course, the COVID-19 pandemic caused a massive upset to Global Markets across all sectors in Hospitality, Travel, Leisure, Gaming, Entertainment and Food Service. The industries we serve are recovering steadily in 2021, thanks to the pent-up desire of leisure travelers. Globally, consumers are responding enthusiastically, and in massive numbers, often overwhelming the businesses that are most in demand. Former Disruptors have become mainstream. Business models and platforms have changed, and must continue to evolve in order to thrive in this New Normal.
TALENT – CURRENT STATE OF AFFAIRS
The demand for talent to accommodate growth, plus the focus on diversity and inclusion, is driving hospitality companies to reach outside of the industry to identify the best executives for marketing, revenue management, operations, digital strategy, analytics, technology, C-Suite leadership and board-level roles. A key challenge is accurately assessing such individuals in terms of the requisite background (experience, aptitude, cognitive skills, etc.) and cultural fit (emotional intelligence, values, style, etc.).
Prior to the COVID-19 pandemic, we had already stated that the math regarding birth rates doesn’t lie, and that a labor shortage, expected for years, is coming. Today, the labor shortage is upon us, and it’s global. The result is greater competition for talent, the need for increased efforts at retention to combat turnover, and thoughtful communication and collaboration between what will undoubtedly be a multi-generational workforce. Companies need to be more diligent in assessing prospective team members as to skill set and cultural fit. Savvy organizations will make attraction, development and retention a priority.
Today’s leadership opportunities require a new type of leader who is tech-savvy, resourceful, intelligent, creative, and nimble enough to take advantage of new opportunities. Leaders must demonstrate emotional intelligence to deal with the multitude of factors past, present and future that affect the labor markets, team member well-being and consumer demand. Companies must be dynamic and seize initiatives. Maintaining status quo is nothing more than loss of market share in today’s world, and the competition will be seeing such companies in their rearview mirrors!
Identifying and recruiting Top Players in the current market is increasingly difficult. Today’s leaders are often resistant to a physical move, seeking remote working scenarios or commuting options as prerequisites. Family-centric considerations continue to be critical factors in assessing career moves. Culture also remains a paramount factor in career decisions, as well as in candidate selection. The “fit’’ must be universal for all parties.
Right now, emotional damage is a major challenge. Everyone has had a lot of time to reflect on their lives, careers and priorities during COVID-19. There is real data as to how company culture and workers have been impacted by the pandemic, and leaders need to take notice. According to O.C. Tanner, which improves workplace cultures through personalized employee recognition solutions, is a key source of substantial data about the impact of COVID-19:
“In the midst of extraordinary innovation and resilience, a few concerning trends emerged: a disconnection, even a divide, between the essential workers and the remote workers; a severe decline in mental health, paired with a corresponding increase in workplace burnout; and individual realizations about industry and career prospects. While many leaders are tempted to move their organizations toward the old “normal,” they must be prepared to accept that the normal we were used to can no longer exist in the face of the transformation that occurred throughout the past year.
From week 1 to week 3 of our COVID-19 study, the number of individuals experiencing depression jumped from 51% to 60.6%. Multiple factors can compound the effects as well. For example, employees that self-identify as a minority had a 20.63% greater incidence of depression. Those who felt their organization had decreased in transparency had an 18.95% greater chance of depression. Finally, and not surprisingly, employees facing severe exhaustion had a 93% greater incidence of depression. Becoming overwhelmed with too many negative emotions can certainly be unhealthy. It can also lead to undesired results for the organization. We uncovered several measures that illustrate how employee depression can lead to adverse outcomes. Here are some of the most compelling:
- 112% increase in fearfulness at the organization
- 65% decrease in engagement
- 18% increase in the employee’s intention to leave the organization
- 67% decrease in employee Net Promoter Score (NPS)
Unfortunately, this trend worsened, and led to increased employee burnout. In our 2021 Global Culture Report, we were able to attribute a 15% increase in burnout due to COVID-19 workplace strain. When organizations had a suboptimal culture, burnout increased 81%.
Burnout was felt differently depending on where you worked. We found physical burnout more prevalent in essential worker populations, while emotional burnout was significantly more prevalent in remote working populations. This disparity has important implications for organizations moving forward, as organizational initiatives must be tailored to address the circumstances of each individual population.”
Recovery from such damage takes longer, and many who love the hospitality industry have either left or are hesitating to jump back in. They have all endured recessions, but the pandemic was a crushing blow! So, while the demand for talent is high, few organizations are even close to being fully-staffed, and many hotels can’t book to capacity because they don’t have enough staff to turn rooms.
Our perspective is that the companies who authentically care about the well-being of their people, inclusive of mental health, and who recognize that it can’t ever be business-as-usual again, will thrive. Those who say all the right things, but aren’t willing to make the real changes needed, or to spend the additional dollars required, will struggle over time.
Digital transformation was greatly accelerated out of necessity due to COVID-19, as remote solutions were critical to staying in business and navigating through the pandemic. The result is that businesses throughout the globe have realized the tremendous time and cost efficiencies associated with Zoom, Teams, Webex and similar digital tools. This efficiency has directly impacted business travel, which has been substantially reduced and may never reach the pre-COVID level again; for certain, not in the near term. Since the Travel & Hospitality industry has been highly dependent on business travel for weekday bookings at a minimum, creativity in how to pivot and utilize room and meeting inventory is the challenge.
A LOOK AT TOMORROW
While the full impact of AI and robotics is not imminent, it is a good time to be planful as to how such technology will impact the labor force. For example, what human roles will be re-deployed to better serve guests? What retraining will be required? What jobs will likely be lost? What new jobs will emerge? How will labor unions morph to accommodate this inevitable reality?
We are optimistic about the future, as life is never without challenges and humans nearly always find a way to adapt. Our industry will recover and technology will continue to converge with travel and hospitality in facilitating our experience. But one thing is for certain: Nothing can replace the sand on that sunny beach in the tropics!