LOS ANGELES—The powerful emergence of AI in various facets of hotel operations was front and center at the 2024 Americas Lodging Investment Summit. The “People & Culture” Boardroom Outlook session, moderated by Kelly Ungerman, senior partner, McKinsey & Company, however, underscored that without a carefully curated team of astute, happy employees, AI technologies and other innovations do not always guarantee a positive customer experience. The four panelists, however, agreed carefully-chosen employees and job satisfaction are more likely to accomplish this.
The Human Touch
Sloan Dean, CEO of Remington Hospitality, quoted foundational hotelier J.W. Marriott to underscore the importance of not only hiring the best people for the positions but also providing ongoing training that brings out the best within them, leading to greater job satisfaction and lower turnover.
“Mr. Marriott got it right when he said, ‘Take care of your associates, and your associates will take care of the guests and the rest will take care of itself,’” Dean said. “As a large third-party hotel management company, the ‘secret sauce’ of our success is our people. Hiring the highly service-oriented people will also attract other (prospective employees) like them. I believe a healthy work culture happens through you, not to you, and when I do onboarding of all our new (hires), I always talk about how I'm just a large ambassador in the company, bur every person we hire is also an ambassador.”
Dean also stressed that success within a hotel or hotel group’s work culture begins with the associates inside the company and is, in turn, passed on to the customer. Remington’s training programs are not only integral to individual positions, but also the associates’ long-term career paths. He cites the example of a program called “Up,” launched a year ago where first-time supervisors and managers are trained not only for the job they were hired for, but are ultimately prepared for the job down the road. He also discusses a learning management system built into LinkedIn Learning.
“Integrating these programs with on-the-job-training is vital,” he said. “Once you’ve hired the right people, you (need to) bring out the best in them.”
As John Cohlan, Margaritaville Holdings CEO, sees it, happy employees translates directly into happy guests. Even with AI having a greater influence on hiring, training, and operations, there isn’t a lot that can replace service with a smile—especially when this is inspired by the philosophy of the late pop cultural icon Jimmy Buffett, whose legacy lives on through the “Margaritaville” brand.
“(When) you’re being hosted by someone who's having a good time, you’re more equitable...and that’s not true of other industries,” Cohlan explained. “Jimmy’s attitude towards life and the importance of vacations is the core of our business. While some managers think about the efficiency and productivity, people coming to work at Margaritaville are seeking jobs that are more fulfilling and career growth-oriented, which is why they get into the hospitality industry. Our business is based on that specific culture, so everything we do for training and the work environment is true to that.”
While individual guests have their own definition of what make the perfect vacation, Cohlan believes what makes Margaritaville a success is the human connection even with AI being used behind the scenes. “We don’t treat (AI) like a threat, but as something that can enhance the guest experience,” Cohlan said. “We want people to feel like they are coming home and being among family. Technology should be used to make it easier for guests to experience a Margaritaville escape, and for employees to have resources that free them up to (better connect) with the guests.”
Power to the (Right) People
As CEO and co-founder of Columbus, Ohio-based Rockbridge Holdings, a private equity firm specializing in hospitality investment, Jim Merkel has witnessed sweeping changes in the hospitality industry during 25-year history of the company. This includes the way AI and other technologies impacts how consumers—especially younger demographics—research and plan hotel bookings, destinations, and specific experiences.
“One thing I'm curious about that hasn’t been (widely explored) is what it will mean for searches and customer bookings,” he mused. “It's already happening, and if I was Expedia, I would be shaking in my boots because customers will be going over to certain apps or ChatGPT, provide it with a series of conditions, and get a recommendation.”
For this reason, among others, Merkel and his Rockbridge team are looking into how technology can help facilitate the opportunity for the teams at hotels to create experiences and build better relationships with guests.
“From the beginning, we focused on the people who were part of the organization,” he continued, adding that the firm’s employees make-up its “most invested in” asset. “There were four partners, and each one of us worked hard to make sure the people we hired shared the same philosophy, purpose, integrity, hard work, and camaraderie. One of the things I'm most proud of is building a culture where people in the company can be lifelong friends.”
Merkel details the company’s recent rebranding, which in part was to ensure the right prospective employees were attracted to the organization. “That’s been a competitive advantage, and it works for our team, (dedicated to) renovating, repositioning, and operating hotels. It’s involves a lot of coordination and hard work. You’ve got to be passionate about it, and you got to love the organization and people that you do it with. While this doesn't work for every company, it works for us.”
A Sense of Purpose
Prior to taking on the role of president at Red Roof, Zack Gharib built his reputation over two decades as a hospitality management innovator behind development, strategic planning and franchise operations during stints at Marriott, Vacasa, LaQuinta by Wyndham and Highgate Homes. When Gharib arrived at Red Roof, he contemplated what would be needed to maintain an optimum work culture. He staged a video meeting where he asked the employees about what was most important to them and what a solid “work culture” and “core values” behind an effective company meant to them.
“We built that culture from the bottom up, but how do you go about keeping it alive,” he said. “This is something that I strive for every day. Adaptability is important because we know our industry is always changing and we need to innovate. An inclusive culture, a culture that cultivates fun and makes everybody thrive to achieve results is just as important.”