AETHOS Consulting Group’s U.K. and U.S. Managing Directors recently shared predictions, concerns, and issues for the hospitality industry in 2020. From challenges related to finding labor to technology, below are their insights.
1. Development programs should deliver more predictable talent pipelines and consistent organizational bench-strength.
Said AETHOS Managing Director and head of the firm’s workplace psychology and 20|20 Assess survey and assessment practice, James Houran, Ph.D., “Companies will certainly need to focus more heavily on internal programs that aim to develop the “next-gen leadership” in structured ways, both in terms of skills linked to management practice and interpersonal influence.
“To be sure, many organizations are becoming far more structured, disciplined, and strategic about systematically grooming their high potential talent as both a retention tool and solution to talent pipeline challenges. Some of the professional development programs put into place now include investment in courses or secondary degrees for high performing associates, internal programs to incubate new mid-managers, and detailed succession planning for filling senior leadership and C-Suite roles.”
2. Sustainability as a company practice can also heighten employee retention.
“AETHOS predicts that HR executives will more frequently be asked by their leaders to lead a cultural mind shift so that sustainability, environmental friendliness, and localization become front of mind across all levels of the organization,” shared AETHOS London Managing Director Thomas Mielke.
The industry has also seen a greater call for collaboration between the different industry stakeholders—including investors, developers, brands, and operators. Mielke suggested that a “more open dialogue could help drive innovation (assisted by technology), ultimately geared to not only improve operational efficiencies but also the sustainable footprint of the hotels themselves.”
Mielke added, “the sustainable aspect of the physical real estate has become a topic that all industry stakeholders have shown a lot more interest in—partly because travelers are demanding it, but also because operators and investors alike have recognized that smart building technologies can add significant value to the financial bottom line. We therefore expect a lot more demand from key industry players adding to, or setting up, more innovative technical asset management and/or facility management teams.”
3. Hospitality will increasingly turn to turbo-boosted use of digital technologies to reach new guests.
“Hotel companies will continue to enhance the digital experience for their customers to drive loyalty by appeasing savvy customers and to continue to amplify their online offerings to differentiate themselves from the competition,” according to AETHOS Philadelphia Managing Director Andrew Hazelton. “This also holds true for cruise and restaurant brands as they too continue to push and compete on the digital battlefield.”
AETHOS Los Angeles Managing Director Matt Peterson added, “Technology will continue to be at the forefront—for enhancing both the employee and guest experiences. ‘Smart’ hotel features such as mobile keys, mobile payment, and TV streaming will be more prevalent. Companies will continue to collect and sort even more guest data, resulting in a necessity for seamless programming and analytics.”
Peterson continued, “Hospitality brands will no doubt also focus more on social media and loyalty programs—with the focus and goal to engage the customer and increase the percentage of direct bookings and ancillary revenues.”
4. Politics and the economy will impact various aspects of hospitality and tourism development.
“2020 is going to be an interesting year, including in the area of hospitality development,” said AETHOS CEO and Managing Director of its New York office Keith Kefgen. “Hotel owners will continue to sell for premiums only. I don’t see a fire sale.”
“There is likely not going to be considerable new construction, but acquisition and trading of flags [brands] will be fast and furious,” Kefgen added. “Brand proliferation will continue as more choices within one company will give leverage to continued brand building. Additionally, more extensions of space—shared living space, shared workspace, shared recreational spaces—will be a focus of developers.”
“And this will be the year of strategy,” added Kefgen. “The companies that get their strategy right will dominate the competition. Getting it wrong, might lead to obsolescence.”