Luxury, Branded Hotel

Hoteliers turn to Carpedia Hospitality for our ability to uncover operational improvements that increase profitability and for our skilled approach in coaching management teams to implement best-in-class labor management systems. Our deep-dive approach allows us to get to know the hotels we work with, and given the unique insight we gain, we frequently become a close strategic partner to many stakeholders throughout an asset’s life cycle.

BACKGROUND:

An owner of an iconic hotel in New York City hired us to develop a customized labor management system in 2014. After the successful completion of this engagement, the hotel was acquired by a new owner, who introduced new payroll and financial reporting systems to the property. While collaborating with hotel leadership to update their labor management tools using inputs from this new software, Carpedia Hospitality was also asked to return to the property to provide extensive training on tools and methodology generated during the initial project to managers that had been recently hired. Additionally, as a result of the success of the preliminary areas analyzed, there was a strong desire to extend the work conducted to include seeking operational improvements within the Stewarding department and to review the Food & Beverage Union contract provisions in order to model labor scenarios in advance of a planned restaurant reconcept. Shortly after this second visit culminated we were invited back again to drive cost improvement in Banquets and in the Housekeeping department where overtime cost had become excessive. Though years had passed since the initial engagement, the hotel’s leaders decided to leverage our deep knowledge of the property and close relationship with both the ownership and operational teams to support the property in realizing this incremental improvement.

THE CHALLENGES:

After defining optimal performance levels for the heavily unionized environment and installing detailed reporting to measure productivity performance against those levels in the first project,  the challenge in the second visit was to reinvigorate the culture of continuous improvement among newly hired Food & Beverage managers, streamline Stewarding operations, and establish an ideal restaurant staffing scenario to inform Union negotiations. In the third visit, Carpedia Hospitality was tasked with reviewing the Housekeeping operation and testing various labor scenarios to determine how best to minimize overtime, and to identify best practices in the Banquet Culinary department to minimize its overall labor cost.

THE SOLUTIONS:

In each visit, observations and analyses were conducted in order to define optimal performance within the departments under review. Carpedia Hospitality worked with management to develop optimized processes and tools to monitor productivity. A combination of small adjustments had a big impact on profitability. At the same time, our team helped to implement changes and encourage a management style that focused on continuous improvement. After recalibrating management tools to interface with the updated software introduced by the new owners, Carpedia Hospitality refined tools and observed new labor guidelines in Stewarding, Banquet Culinary, and Housekeeping. Additionally, new leaders on property were trained to learn and make management decisions using the labor management tools, and provided methods and instruction in order to continue to examine processes to promote ongoing improvement.

 THE RESULTS:

Within 16 months of implementing the initial workforce management system, the hotel met the improvement goal set at the beginning of the project by 160% – an 8% improvement in line-level productivity. In the subsequent reviews, the 12% overtime rate for in-scope positions was reduced by 50%. Additionally, the property’s management was able to continue operating at this level once the new ownership arrived as the standards were easily adapted to fit their preferred financial reporting tools. As a result of the collective work and the team’s desire for continuous operational enhancements, the subsequent revisits quickly became self-funding through using Carpedia Hospitality’s horsepower to promptly implement the improvements identified.

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