Chang­ing times

The man­power sup­ply chal­lenge needs be­spoke so­lu­tions

Hotelier Middle East - - COMMENT & OPINION -

Al­though hu­man re­sources is one of the most com­plex and com­pre­hen­sive el­e­ments of any busi­ness op­er­a­tion, the for­mula for suc­cess­ful staff re­ten­tion on the face of it should be rel­a­tively sim­ple: hir­ing the right tal­ent for the right po­si­tion and equip­ping them with the right tools to com­plete their tasks.

Or­di­nar­ily, this ap­proach would tran­scend many in­dus­tries. How­ever, in the UAE hos­pi­tal­ity sec­tor there is an­other di­men­sion that re­quires due con­sid­er­a­tion — flex­i­ble staffing. In the US, pay­roll alone can ac­count for up to 50% of a ho­tel’s to­tal op­er­at­ing ex­penses. In the UAE there’s the added ex­pense of staff ac­com­mo­da­tion and trans­porta­tion.

An­other ex­pense that UAE ho­tels are sad­dled with is the risk and as­so­ci­ated cost of re­cruit­ment and re­ten­tion – so there’s a lot rid­ing on hu­man re­sources, es­pe­cially when guest ser­vice de­mand and REVPAR can fluc­tu­ate sig­nif­i­cantly through­out the year.

In July, ho­tels across the UAE achieved an av­er­age oc­cu­pancy of 66%. The good news is this fig­ure is 0.9% higher than the pre­vi­ous month, al­though the last two weeks of Ra­madan did fall into June.

The less-than-ideal news is the sub­se­quent im­pact on ADR and REVPAR, which de­creased 9.7% and 8.8% re­spec­tively, year-on-year.

This isn’t a sea­sonal anom­aly. Full year fig­ures for 2017 showed that while av­er­age oc­cu­pancy inched up 0.5%, ADR de­clined 3.8% and REVPAR 3.3%. This has not been helped by the ef­fect that the strong US dol­lar is cur­rently hav­ing on the UK pound, the euro, the Rus­sian rou­ble and par­tic­u­larly, the In­dian ru­pee, mak­ing the UAE a more ex­pen­sive des­ti­na­tion.

How­ever, per­for­mance started to wa­ver in 2016, when the first ma­jor in­flux of new sup­ply for Expo 2020 en­tered the mar­ket. The trend is set to con­tinue for an­other 12 months, with 126,576 rooms across 222 projects, in the UAE pipe­line for 2018.

But the re­sult­ing pres­sure on bud­gets is only half the story. Hote­liers faced with the chal­lenge of re­duc­ing costs while com­pet­ing for both guests and tal­ent, have their work cut out.

In fact, data from con­sul­tancy Robert Half con­firms that 85% of CFOS are con­cerned about los­ing top per­form­ers this year, as com­pe­ti­tion heats up.

In this cli­mate, man­power ser­vices can present a com­pet­i­tive so­lu­tion, es­pe­cially when providers such as Farnek, have sup­ported the hos­pi­tal­ity in­dus­try with out­sourced per­son­nel for house­keep­ing, se­cu­rity, main­te­nance and recre­ational staff, to name but a few, for many years.

The trend that we will see de­vel­op­ing now is that hote­liers will want skilled tal­ent, paired with unique re­quire­ments to en­hance out­comes, ef­fi­ciency and cost. In short, a re­spon­sive and ag­ile model de­signed around the needs of the mod­ern hos­pi­tal­ity busi­ness.

Man­power sup­ply lever­ages tal­ent and flex­i­bil­ity while achiev­ing ex­actly this. The strat­egy is to meet de­mand for skilled tech­ni­cians, both con­tract and per­ma­nent, in a mar­ket­place where quick and flex­i­ble ac­cess to the right peo­ple cre­ates clear busi­ness ad­van­tages.

Ma­jor man­power ser­vices com­pa­nies can ef­fec­tively match hos­pi­tal­ity pro­fes­sion­als with spe­cific skillsets to ex­plicit job re­quire­ments, with a broader and longer-term out­look than the more tra­di­tional ap­proach to out­sourc­ing.

Busi­ness part­ners ben­e­fit from the ex­per­tise of skilled work­ers who aren’t just qual­i­fied in their area of ex­per­tise, they can also pro­vide so­lu­tions de­rived from ex­pe­ri­ence gained from work­ing in other al­lied sec­tors, such as event man­age­ment, and con­tract cater­ing for ex­am­ple.

They also ben­e­fit from our abil­ity to

The trend that we will see de­vel­op­ing now is that hote­liers will want skilled tal­ent, paired with unique re­quire­ments, to en­hance out­comes, ef­fi­ciency and cost. In short, a re­spon­sive and ag­ile model de­signed around the needs of the mod­ern hos­pi­tal­ity busi­ness”

mo­bilise staff for large projects quickly, such as sup­port staff to strengthen pre­open­ing man­age­ment teams, as they strive to open on time and on bud­get, a chal­lenge faced by many ex­ec­u­tives of new ho­tels to­day.

And of course, we ac­knowl­edge that sup­ply­ing highly trained man­power must be com­pleted at a com­pet­i­tive price-point, which can save be­tween 30 to 50% on the cost of hir­ing full time, in­house em­ploy­ees. Pin-point­ing de­mand for skilled staff and re­spond­ing with be­spoke so­lu­tions, should cer­tainly en­hance those fig­ures.

Man­power sup­ply can pro­vide the hos­pi­tal­ity sec­tor with a vi­able and sus­tain­able so­lu­tion, par­tic­u­larly as busi­ness be­comes ever more au­to­mated.

One thing is for sure, dis­rup­tion is in­evitable in hu­man re­source and as the great Bob Dy­lan once wrote, ‘Times they are a-changin’. ABOUT THE AU­THOR:

Markus Ober­lin is the CEO of Farnek – one of the lead­ing to­tal fa­cil­i­ties man­age­ment com­pa­nies in the UAE with a work­force of 4000+ em­ploy­ees. He has more than 25 years’ in­ter­na­tional ex­pe­ri­ence in the field of fa­cil­i­ties and en­ergy man­age­ment and has been work­ing for Farnek for more than 10 years. Markus Ober­lin is a cer­ti­fied en­gi­neer / MBA. Con­tact [email protected]

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