Raini Hamdi looks at how hotel companies are disrupting the HR system in a bid to attract Millennials

Legacy human resource practices of hotel companies are starting to unravel in the hot competition for manpower,  75 per cent of whom globally will be Millennials by 2025.

The two factors that pull Asian Millennials to work in industry sectors including hotels, travel agencies and airlines are career progression (49 per cent) and strong company reputation (26 per cent), according to a Singapore Tourism Board (STB)-commissioned released at the Asia Travel Leaders Summit (ATLS), an anchor event of TravelRave recently.

Alas, the survey reflects the industry is unable to retain Millennials: Only 39 per cent said they are likely to stay put for the next three years. Only 54 per cent are satisfied with career progression prospects. Not even half (45 per cent) believe they are paid a competitive wage.

Asked if the industry must be disruptive about their HR practices to attract and retain talent, Neeta Lachmandas, STB’s assistant chief executive, said: “I don’t think we have a choice but to be disruptive.”

She said this won’t happen overnight as “we have a complex industry that is very structured and it’s hard to move away from the structure”, but “at least the conversations have started on the ATLS platform and we’re learning”.

In the hotel sector where talent shortage is particularly dire as a result of a boom in construction in AMEA, disruption is happening. Previously, for example, it would take on average 17 years – a lifetime to Millennials – to rise to the position of a hotel general manager, but this is being rapidly flattened.

Starwood Hotels & Resorts Asia-Pacific president, Stephen Ho, said: “We had a Millennial saying (during ATLS this year) that she wants to be a GM in five years. I say, that’s not impossible.”

He added: “We are competing with various industries for talent. Starwood is seeing people move to, say, an OTA or a digital company, whereas previously they would stay within hospitality.”

Starwood has China to thank for in helping it shape new thinking on hiring and retaining. Ho recalled the early 80s when the chain had a huge pipeline in China and started grooming local talent.

Today it has many GMs in their early 30s, particularly in China and India.

Said Ho: “When we recruit, we give people a career plan. That has helped us keep attrition to under 25-30 per cent. We create role models for Millennials out of successful people. We were the first hotel company to export a mainland Chinese GM back in the early 80s to Malaysia and Fiji – in those days it was not easy; an owner would query why he hired, say, Starwood’s Sheraton, only to get a GM from mainland China. It’s because we want to expose him to a global platform and bring him back to China and that person now is our head of China.”

Ho’s next aim is to increase the number of female leaders, thereby expanding the pool of talent. Globally, 18 per cent of Starwood leaders are female. “We can raise the bar to 30 per cent. Females tend to have more responsibility to look after the kids and family; we are prepared to give them a sabbatical if they need it; we have different programmes,” said Ho.

Starwood’s competitor, InterContinental Hotels Group (IHG), has started a programme to groom young Asians to become GMs of Holiday Inn Express within maximum three years, and five years for its full service brand Holiday Inn.

IHG’s senior vice development-AMEA, Clarence Tan, also noted that Asian owners have had a change of heart. Whereas previously they bank on an international chain to bring in an experienced Western GM to run their hotel, owners today are no longer averse to hiring local GMs without 20 years’ experience and in fact want to see chains promote local talent, said Tan. “We’re proud to say all our GMs of Holiday Inn Express in Thailand and Indonesia are locals,” he added.

Marc Steinmeyer, president director/founder, Tauzia Hotel Management, however, cautioned it isn’t just about a straightline career progression anymore but giving Millennials who want to “learn faster” the chance to do so.

“But we as an industry are still conservative,” said Steinmeyer.  “We are vertical rather than horizontal about career progression. We must disrupt the system; if we don’t, it will disrupt us.

“Once a year, for example, I give people the opportunity to change their job within the organisation, even if this means I have to take some risk. This way, we also help people to recognise there are many ways to develop a career in hospitality and the GM post is not the be all and end all.”

Jumeirah Group president and CEO, Gerald Lawless, in an email interview, agreed, saying: “There are many disciplines to pursue within our business, such as human resources, sales and marketing, information technology, development or indeed hospitality operations.” Jumeirah has introduced programmes for school-leavers to come into the business and join a six-month foundation course which enables them to decide which part of hospitality they might be attracted to. “This programme has been particularly successful in attracting young Emiratis to join us directly from school,” said Lawless.

“We also have a graduate management scheme in place whereby we have normal and fast-track programmes to take people to the level of GM in less than 10 years from having graduated from university,” he added.

More chains are also launching ‘lifestyle’ brands aimed at Millennials who will be their biggest customers in 10 years, but also to attract Millennials to work in them. Said Thorsten Kirschke, president Asia-Pacific, Carlson Rezidor Hotel Group: “The recent launch of our newest brand Radisson Red in Asia-Pacific has also opened up an opportunity to attract the Millennial-minded talent (the first Radisson Red will open  in Shenyang, China in early 2016). Radisson Red is targeted at the Millennial-minded who seeks out a non-traditional guest experience which is focused on design, technology, personal choice and interaction. To deliver this experience, we will need a different team profile who understands the guests’ mindset and needs. This potentially translates into career opportunities for not only Millennials but those with the same mindset.”

Kirschke looks at Millennials as a mindset, stressing that in the end, it’s still about ability and performance – not age.

“In hiring, we try to match not only skills but the natural vocational inclination of candidates to job positions. For example, we have hired several Millennials who are savvy in digital and social marketing to roll out global social media campaigns, an area that they have shown great affinity with and which allows them to excel naturally,” he said.

With the right match, Carlson then unfurls other strategies to retain talent, including helping people to enhance their capabilities and leadership skills. A Carlson Rezidor Business School provides training in areas such as revenue optimisation, social media marketing, finance and human resource management. Talent Conversations teaches team leaders how to mentor their team members. A High Potential Development Journey trains star employees to be future GMs/senior executives.

Besides, not all Millennials are equal and seek only career progression. The STB survey identifies no fewer than five types and companies are urged to employ different carrots to motivate each Millennial depending on what life stage he is at and priorities he has. The Idealists, for example, are driven by meaningful work and being part of a prestigious company, whereas for Money-seekers, salary and international exposure are the most critical factors (see Infographics, below).

So companies that are quick to understand the new workforce, and quicker still to adapt to changes, will have less to worry about a lack of manpower – or these days, shall we say, Millennialpower.

This article was first published in TTG Asia, November 14, 2014 issue, on page 4. To read more, please view our digital edition