Take the initiative
Is hospitality suffering from a dose of "initiativitis"? The market seems to be awash with schemes to boost profitability, competitiveness and customer satisfaction via a more flexible, better trained, better rewarded workforce, and choice spans the well-established Investors in People (IIP) scheme to last year's hospitality-specific Excellence Through People (ETP) and Hospitality Assured (HA).
Recent research from the USA suggests that "people policies" are the most important driver of profits, says Kim Parish, personnel director at Scottish & Newcastle Retail. She notes a strong link between NVQ achievement and sales growth (the company has put 12,500 staff through NVQs).
But does hospitality really need so many tools to tackle its perennial problem in attracting and retaining staff, and to repair its image as a poor employer of staff with little incentive delivering disappointing levels of service?
Samantha Davis, human resources director at Whitbread's Brightreasons restaurant division, thinks not. "There are too many initiatives with a high degree of overlap," she says.
But ETP director David Battersby argues that the schemes are complementary, and offers a simple equation to sum up the distinctions: ETP = quality jobs, IIP = quality people and HA = quality service. While all touch upon common ground - such as setting up effective two-way communication channels with staff, training, incentives and performance reviews - they cover them from different perspectives.
And the verdict from pro-initiative employers is that each scheme has its place. "Every model has got a piece of the jigsaw," says Mark Philpott, director at contract caterer Directors Table.
IIP is seen to offer a model operational framework that marries training policies with business objectives. Battersby sees ETP as a more simplistic but essential "nuts and bolts" employment package. "If you don't have the right employment practices in place, you are wasting money training staff under IIP who will then leave you," he says.
First steps to IIP
Both ETP and HA are marketed as useful first steps to ease small businesses into the more arduous IIP process, and they can be achieved in an average two months against the six to 18 months typical of IIP, as ETP candidate Pat Denzier, proprietor of Edinburgh's Denziers 121 restaurant, discovered. "It is most suitable for small businesses," she says. "It looks attainable without too much bureaucracy."
Participating in the schemes has the virtue of involving staff from day one right up to the assessment interviews, and all participants say this has helped clarify staff awareness of their own (and others') roles, contributions and problems. But do any of the schemes deliver tangible business benefits?
For some larger operators, maybe not. Both Scottish & Newcastle and Brightreasons found they already had most of the framework and processes in place when they went for IIP. But they still valued the confirmation that they were doing the right things, the opportunity to fill in any gaps, and the fresh view provided by the benchmarking and assessors' reports.
Parish regards certification primarily as a useful PR tool in the job stakes, but Davis is less convinced. "While the organisations have done a good job selling the initiatives to employers, I am not sure the outside world knows enough about them to make a conscious decision on that basis," he says.
But other firms, such as the Fourcroft Hotel in Tenby, Pembrokeshire, and the Headland Hotel in Newquay, Cornwall, found the process of achieving IIP effected a cultural revolution.
The Fourcroft Hotel's 15-month road to achieving IIP in May 1996 contributed to the retirement of proprietor Chris Osborne's parents into consultative rather than executive roles in the family-run management structure.
"Members of staff could not see much potential for doing better and developing," says Osborne. The introduction of NVQs and the opening of a career path have led, he says, to "happy, incentivised and fulfilled staff" and enabled the hotel's second chef to rise into the management team.
The Headland Hotel was one of the first 100 companies to achieve IIP when it won accreditation in early 1993. Since then, it has shown dramatic growth and has become, says owner Carolyn Armstrong, "so much more fun, vibrant, alive".
Armstrong found that encouraging staff to contribute ideas and work as a team has prompted them to take responsibility to the degree that "they will be telling me what to do next". This has left her free to concentrate on more strategic matters such as the opening of a holiday village of 35 luxury cottages this autumn.
The business benefits have been dramatic. Profits have grown by 200% and turnover by 55% in the three years from 1995 to 1997, allowing Armstrong to plough back £500,000 into the business and move to all-year opening in 1998.
The number of permanent jobs has soared from 15 to 50 while wage costs as a percentage of turnover have fallen from 35% to 27%, despite a small pay rise and a shift towards a five-day week for individuals. Staff turnover has fallen and absenteeism is negligible.
And customers have noticed the improved service. Armstrong says it was their recommendations that won the Headland three AA stars and entry into the Which? hotel guide. While repeat business soared from 58% to 70% in the two years to 1992, it has since halved as new business mounts from a move into conferencing and picking up disgruntled customers from "less customer-orientated" local rivals.
The Swallow Hotel in Gateshead, Tyne & Wear, underwent its first reassessment in July after gaining IIP in 1995. General manager Chris Wilson says profits soared by 115% in 1995 on 1994 figures.
"Staff want security and development, and the facility to broadcast their feelings and be heard," says Wilson. He feels this has been achieved, citing the impressive decline in labour turnover to just 1.66% in 1998, and absence rates to 2%.
The number of customers rating the service as "good" or "very good" has climbed from 88% in January 1998 to 95%. To move forward, Wilson will now score "good" comments negatively and aim only for "very goods".
Stephen Fenwick, general manager of the Marriott Hollins Hall Hotel in Baildon, West Yorkshire, estimates that it costs £600 to recruit and train each new member of staff, so he has been gratified by the drop in staff turnover from 50% three years ago to "28% and falling" in 1998.
Fenwick invested 130 hours of time racing the company through IIP over 21 weeks last year. No mean feat, since the hotel had closed for an £11.5m upgrade that increased bedroom numbers from 58 to 122, and staff numbers from 70 to 160, and added golfing and leisure facilities.
Since then, staff satisfaction scores (measured annually) have climbed from 88% to 92%, while guest feedback forms (analysed monthly by Marriott in the USA) have reached a record 86%.
With ETP and HA still in their infancy, most participants found it hard to disen-tangle any immediate benefits from those springing from their prior pursuit of IIP. However, ETP's attention to written documentation of possible legal queries has proved useful for many. The Headland Hotel management realised it was lacking a written equal opportunities policy. It was also useful for Denziers 121 Restaurant in Edinburgh, which was assessed for ETP only last month. "It smartens up procedures and keeps you within the law," says proprietor Denzier. "This is important with society becoming more litigious."
The main changes lie in communications, which had been "verbal, a bit ad hoc". Denzier has put up a staff noticeboard, written step-by-step dismissal procedures, and tidied up systems of identifying and tracking training needs. ETP also unearthed a gap in the Headland Hotel's systems, namely it had no written equal opportunities policy.
Legal aspects brought to light
While Fourcroft proprietor Osborne found he needed do little more than tweak his paperwork to become an ETP best employer, he appreciated the legal aspects not covered by IIP. And he was full of admiration for the ETP action pack and video, which incorporates case studies and sample documents. "The pack stands up on its own," he says. "It's worth having even if you don't go through the process."
Achieving a recognised standard is seen as a valuable boost to staff morale and commitment and Alan Bostock, general manager of the Bonnington Hotel in London's Bloomsbury, sees HA as a special tribute to their efforts. "It's a feather in their cap," he says. "Often awards don't reflect the staff who have achieved it."
The family-run hotel achieved IIP in January 1998, HA in March, and has applied for ETP. Bostock believes he has benefited from HA's more practical approach to customer care, particularly in tracking how complaints are handled and prevented from recurring.
HA has attracted more than its fair share of contract caterers - they comprise three of the six firms to be accredited - and Gardner Merchant's city dining arm Directors Table was the first in this sector.
Managing director Rodney Widdowson had already found IIP "a great help in looking for new business", as most of his clients are IIP-accredited, blue-chip firms seeking partnerships with like-minded companies.
Cranfield Conference Centre, which feeds and houses middle and senior management delegates at Cranfield University in Bedford, scored a hat-trick when it became the first to win HA last January. It had already achieved IIP in 1996 and ISO 9002 in 1997 (and has also gone for ETP). But it still found scope for improvement, and reduced the number of "fair" and "poor" comments to below 5%.
Training manager Kevin Hamer had one quibble. Having scored 97% with HA, Hamer was unhappy at being categorised alongside the scrapers-through who just exceeded the 65% needed to qualify, and would welcome a more tiered accreditation system (others made the same point about IIP).
Winning recognition does not allow firms to rest on their laurels. Business practices move on and customer expectation continues to rise, so each scheme demands constant improvement and reassessment - annually for ETP and HA and every one or three years for IIP.
Some firms, such as Directors Table, favour a two- to three-year reassessment cycle to leave time for consolidation. But Swallow's Smith thinks it is important to keep the process of improvement in the foreground. He has opted for the shorter IIP cycle, and anticipates the added benefits of less paperwork and slightly lower costs. n
Next week: Details of ETP award
