Stepping Up: Accor’s Ben Cadwell on Meeting Challenges Facing the Industry Now

Accor’s Chief Operating Officer, United States Ben Cadwell met with LODGING while attending the 44th annual NYU International Hospitality Industry Investment Conference at the Marriott Marquis. At that time, Cadwell, who assumed this position less than a year ago, discussed issues facing the industry and Accor’s responses, including what he calls “our workers’ whole life.”

What’s keeping you busiest these days at Accor?

Like everyone else in the business, we’re trying to manage the demand and activity levels in our hotels, which, by and large, is pretty much back up to pre-COVID levels. Unfortunately, we are not back to pre-COVID support levels from a staffing standpoint, and this is, far and away, the number one topic on everyone’s mind right now. We just don’t have people to be able to service the activity levels in our hotels. Mainly for that reason, at a recent meeting of regional vice presidents from all across the United States, we spent a day and a half discussing ways we can make Accor and our brands a more attractive place to work while also servicing our guests and generally running our hotels better. We are also busy preparing for a couple of upcoming openings, including one of Raffles, our ultra-luxury brand, which is set to open in Boston early in 2023.

Why did you choose that brand and market now? Do you plan to continue to expand in that direction?

Boston is a great market in the sense that a lot of customers who travel there are willing to spend accordingly for the kind of luxury experience a five-star hotel provides. However, perhaps more importantly in terms of future development is that it will be part of a mixed-use development that will also include Raffles-branded residences, something for which there is a lot of demand in the Boston market. In fact, what we are seeing generally, is that it is very difficult for developers to make the economics work for a new-build luxury hotel today that does not have some sort of a residential component, whether that’s full-service residences, fractional timeshares, or some kind of hybrid.

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In what ways are you coping with challenges that include a welcome return to high demand offset by rising inflation, higher costs, and the labor shortage?

We’re finding that the whole business model of our hotels is changing very rapidly, and it’s not clear where it’s all going to land. Between inflation and all the other dynamics, however, we’ve seen very little price resistance from our guests, so everyone has been able to raise their rates to the extent that average rates for our rooms have never been higher. At the same time, our costs are going up a lot more, too. Everything is more expensive—operating supplies, food and beverage, utilities, technology. This includes increases in the wages we pay both our employees who have stayed on and the ones we’re bringing in amidst the competitive hiring environment

As for what we can do about it, as I see it, hotels have become less efficient during this normalization period, and that needs to change. I think the good news is, generally, our owners understand the trends and dynamics and recognize that while we can’t control costs, we can better manage the balance between the costs and services we’re offering to our guests, the prices we’re charging, and our owner’s expectations.

What about your approach to the labor challenges?

We’ve had considerable success in hiring more staff, but, in many cases, we’re losing as many as we’ve been able to hire for all sorts of reasons, such as being poached by a competitor for higher wages or finding the environment—especially now—too demanding.

We need to listen to what our employees want. Beyond more money and opportunity for advancement, many whose positions can be done remotely want to work from home at least part of the time.

We’re thinking hard and doing a lot of interesting things to try to adapt. Although there are only so many things we can do to adjust the working model for our housekeepers, we can offer more flexibility in other ways. While once obvious tattoos and piercings were not permitted in employees at luxury hotels, they’re fine now. We’re also listening to what employees and hotel owners are telling us about their concerns, including about diversity and inclusion (D&I), environment, social, and governance (ESG); it’s common now to discuss questions such as: What are you doing to hire more women? How many BIPOC (Black, Indigenous, and people of color) are there at this property and what do we need to do to recruit more?

These are the kind of conversations that we’re having with our leadership groups. It’s great to have that kind of engagement.

What is the “whole life” approach you’ve spoken about in response to the grievances of team members?

We at hotel companies are always saying how much we value our employees, saying things like, “We care about you as a person. We want you to be happy. We want to advance your career. We want to invest in you.”

And that’s all really important, but our employees, quite frankly, are now calling us out on our words, letting us know what they need in their whole life to work in our industry—to be able live comfortably in the community and be able to take better care of their families. That’s why we’re rethinking and overhauling both how we structure their jobs and support their lives—for example, with a simplified employee manual, a subsidy to help them with commuting costs, good healthcare—all to show what we mean when we talk about a whole life approach to things.

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