Luxury Hotelier - September 2007 - (Page 52)

52| Insight Cornell University Employee turnover solutions Researchers suggest ways to cut costs, improve hiring process at high-end hotels ndless employee turnover acts as a tedious tax on hotel revenue. Certainly the constant turnover of employee associates can compromise even the best hotel’s customer-service efforts. While some turnover seems inevitable—perhaps even beneficial— most hotel operators seek ways to control unwanted employee turnover. Two researchers at Cornell University are working to gradually unravel the costs and causes of turnover. By identifying the aspects of turnover that are most costly, Cornell professors Timothy Hinkin and Bruce Tracey hope to identify GLENN ways to cut those costs by WITHIAM eliminating the causes or at Glenn Withiam least reduce the expense of directs publicathose causes. They invited tions at The Center for Hospitality hoteliers at all levels to Research at Cornell anonymously share their University in Ithaca, turnover data through a New York.Contact him at grw4@ Web-based research tool. So cornell.edu. far, 33 hotels have done so, and 12 of those properties are upper-end operations (based on their average daily rates). Though the number of hotels involved so far is small, the analysis is beginning to point to specific areas for improvement. Exit interviews and careful selection might be two of the keys to reducing the expenses of turnover. Mr. Tracey and Mr. Hinkin divided the costs of turnover into the following five categories: pre-departure, recruitment, selection, E orientation and training, and productivity loss. For upscale hotels, productivity loss was far and away the greatest cost of turnover, representing a much higher percentage than for midscale hotels. However, the researchers wanted to go beyond that well-known issue to find clues to reduce the cost in each area of turnover. Their analysis showed that exit interviews and careful selection processes reduced costs for some hotels. Mr. Tracey and Mr. Hinkin found that hotels at all levels that spend more on pre-departure activities, specifically exit interviews, had a relatively lower overall cost of turnover. Likewise, they discovered that hotels that involve a wider group of supervisors and peers in the selection process saw relatively lower turnover expenses. For high-ADR properties, selection costs represented a large piece of total turnover costs. Looking specifically at the relative cost of selecting new employees, the researchers found that selection costs for low-complexity jobs absorb a higher percentage of total turnover costs than do the selection costs for highturnover positions. They believe that the source of this relatively high expense comes from the difficulty of developing a pool of qualified candidates for lowcomplexity positions. Based on their study, they suggest that involving existing employees in the search process, such as through referrals, can help managers develop a pool of qualified candidates. Job fairs and open houses also can help with recruiting qualified employees, but the researchers’ main point here is for hoteliers to pay closer attention to ways of improving the process of attracting and developing employees. Although Mr. Hinkin and Mr. Tracey found that the cost of turnover generally is highest for complex jobs in high-end hotels that operate in cities with a high cost of living, they also believe that their study points out ways to cut those high costs. The study, “Costs of Employee Turnover: When the Devil Is in the Details,” is available at no charge from Cornell University Center for Hospitality Research (www.chr.cornell.edu). Job fairs and open houses also can help with recruiting qualified employees, but the main point is for hoteliers to pay closer attention to ways of improving the process of attracting attractin and developing employees. Luxury Hotelier | September 2007 | www.LuxuryHotelier.com http://www.chr.cornell.edu http://www.LuxuryHotelier.com

Table of Contents Feed for the Digital Edition of Luxury Hotelier - September 2007

EDITOR’S LETTER PUBLISHER’S LETTER INFORM NETWORK PERSONALITIES INSIGHT INSIGHT PROPERTIES ROPERTIES INSPIRE DELIVER PROTOCOLS INSIGHT INNOVATE DEVELOPMENT INDULGE INSIGHT CONNECT UPDATE DOSSIER

Luxury Hotelier - September 2007

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