As a hospitality consultant with over two decades of experience in evaluating hotel valuations and Return on Investment (ROI), I have often wondered if organisations lack adequate metrics for measuring the value of talent and employee ROI. Investments in the workforce are often misrepresented as detrimental to budgets, with no recognition of the softer aspects of service or the value thereof as a result of that service.
Today, with the advent of technology, the proliferation of hotel brands with blurred products and services, the only real differentiator can be the service brought about by individuals who work in these hotels. Therefore, to me personally, the focus must shift to making long term strategic decisions. So, what if some of these decisions are unconventional or may sound absurd for a sector known for its long working hours?
People-First Strategies for a Sustainable Future
Many hotel companies have taken decisions to reset their people strategies post the Covid-19 pandemic. However, most have been straightforward forward, and what we have heard often is that they have reduced payroll costs and reduced the number of employees by combining certain roles and responsibilities. That may seem like a short-term fix, however, I am not too sure of combined roles or reducing pay as a long-term strategy. The industry got a taste of its own medicine right after these measures were taken. We are now at an all-time low in terms of the quality of personnel in hotels. In fact, the problem has gone further back with an all-time low enrollment in hospitality colleges across the country. I would say that broadly speaking, the issue here is low monetary benefits and long working hours. So, if we want to value our employees and get a good ROI out of them, we need to pivot our solution around them. And this is not just applicable to hotels but can be applied across all sectors and including services.
One possible solution can be a four-day work week, which has become a hot topic. In recent years, Microsoft Japan ran a one-month trial, which showed productivity levels to go up significantly, apart from ancillary savings in electricity, reduced paper printing, etc. In 2020, Spain was one of the first countries to work on a national shift to a four-day work week or 32-hour week. Another example would be the government of Iceland, which between 2015 and 2019 conducted one of the most comprehensive 4-day work week trials in the world. The experiment involved over 2,500 workers across government agencies and public institutions.
Employees worked reduced hours with no reduction in pay. The results were remarkable —productivity either remained constant or improved across most workplaces, while employees reported lower stress levels, better work-life balance, and overall increased well-being. The success of the trials prompted a large-scale shift in Iceland’s labour model, with 86% of the workforce now having the right to request shorter hours. More recently, in the United Kingdom, a 4-Day Week Trial (2022–2023) involved 61 companies, including some in the hospitality space. Over 90% continued the policy post-trial.
My view is that the idea may not work for every organisation and some companies may benefit from other forms of flexibility. However, the burnout rate in hotel operations can be high, and this is something I strongly urge large hotel corporations to at least seriously evaluate. The four-day week was used first in the immediate aftermath of the great depression of the 1930s to reduce unemployment. However, the idea has gained more relevance in recent years and could become a more accepted and doable global trend.
Some obvious benefits to organisations of a four-day week include:
- Improving the ability to attract and retain talent.
- Increasing overall employee satisfaction. Remember, happy employees make happy customers/guests.
- Potential lower employee absenteeism and sickness reports.
- Increasing productivity.
Peripheral benefits:
- Planet Earth – Reduced commuting to work could actually reduce work travel-related emissions by 15-20%.
- Work-life balance is better for employees, more time with family, with potential to travel together and provide a boost to tourism and taxes to governments.
- If employees are indeed your most valuable resource in your organisation, then give them a return on investment they truly deserve.
