Labor Management in the Hospitality Industry continued
While it is common in the industry to express labor standards on a per shift basis (80 check ins and check outs for the front desk, 40 covers per server), more precise or detailed standards are desirable. Standards should be tied directly to productivity (volumes/hours) so that the most accurate number of required labor hours is determined. For example, if the houseman’s productivity goal is 12 minutes of labor per occupied room the labor standard should be stated as simple as that, or as 5 rooms per hour. Another example that is often overlooked is determining the flow of business volume during a shift. The breakfast shift may project a total of 200 covers but the flow of those covers is not constant throughout the meal period, which means the number of server hours scheduled at opening would not be the same during the peak of the meal period. Knowing the true number of labor hours needed helps to facilitate planning and staffing that may include shorter shifts or cross-utilization of staff.
Organizations need to understand that standards are a measure of productivity and cannot be expressed as a percentage of labor dollars to revenue. One of the biggest misconceptions on the part of less experienced managers using labor management for the first time is that labor should be managed on a percentage of labor dollars to revenue. Using this approach often leads the manager to think that more labor can be used in times of higher revenue. This is not a proper approach to labor management. If higher volume is driving the higher revenue, then more labor should probably be used. But if a higher average rate is driving revenue, then labor hours should remain unchanged as the volume is unchanged. For example, if a guest room is sold for $200 per night on weekdays but only $120 per night on weekends, it still takes the same amount of labor to clean the room regardless of how much revenue is being generated. The hotel should not be using more labor to clean the room during the week simply because the rate is higher. The essential component of planning is relating anticipated business volumes to the required labor hours. This step places the focus on the labor needed to satisfy all the goals of the hotel (customer, employee, owner, and financial). Too often, managers go directly from a forecast to a schedule, leaving out the planning step. Inevitably, starting with the schedule leads to a focus on employee preferences and the development of a schedule which best satisfies those preferences. There is certainly nothing wrong with a schedule that best satisfies as many employees as possible. But developing the schedule without regard to when the labor is most needed can create ineffectiveness in service and inefficiencies in labor.
Standards are not something that are developed once, filed in a binder, and stored on a shelf to collect dust. They are a dynamic tool to be used when reviewing alternative ways of improving guest satisfaction or seeking ways to lower labor costs with minimal impact on guest service. The standards also need to be reviewed when operational changes take place. For instance, we have all seen the competition over who has the most luxurious bed in their guestroom. If an operator decides to increase the number of linen layers or pillows on the beds then it would be necessary to evaluate what the real impact is on the amount of time a housekeeper is allotted per room.
Scheduling
Once a manager knows how busy the operation will be (forecasting) and the proper standards (planning) that drive the use of labor, it is time to move on to the third step, scheduling. Scheduling involves a comprehensive effort to align guest demand, financial goals, and employee skills and preferences.
It is critical to start the week with an accurate schedule. Many labor management challenges occur when a schedule does not meet business demands. Over-scheduling essentially wastes payroll dollars while under-scheduling does not provide the proper level of guest service. The schedule must match employee work times with the business volumes. Business demand does not allow the hospitality industry to be a “9 to 5 business.” The scheduling of employees must take this into consideration. While it is important to consider employee preferences in scheduling decisions, these preferences should not be the sole driver of the schedule.
Executing
Executing is the first step of the labor management process that is outside the “set-up” stage. The three steps which lead to executing all occur prior to the start of the work week, making sure everything is prepared for a successful week. This step begins the minute that the work week begins. This is where the manager ensures that the staffing levels meet the projected business volume.
Execution is a day by day process. Executing according to the labor management plan takes a daily focus by the manager. Areas to focus on include:
- Monitoring whether the actual business volume is in line with the forecasted volume.
- Reviewing whether changes to the schedule need to be made in order to handle volume changes or employee situations.
- Managing work schedules to eliminate unnecessary hours worked or overtime.
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