The Skills : Productivity Equation – a Golden Opportunity

Cafe Latino

There have been some significant developments concerning Tourism and Hospitality over the past few days. Taken together, I believe they add up to an unprecedented opportunity for the sector:

  • The Chancellor, George Osborne, announced the introduction of a new National Living Wage – which some in the industry greeted with less than total enthusiasm;
  • A new report by workforce development charity People 1st found that low productivity levels need to be urgently addressed in the hospitality and tourism industry with high levels of employee turnover;
  • The Prime Minister launched a new plan aimed at encouraging the spread of tourism’s benefits right across the country. The plan will focus on five main areas:
    1. A better co-ordinated sector: the sector is too fragmented – we want to see local attractions and tourism organisations collaborating to grow the sector for everyone, not competing.
    2. Skills and jobs: Driving and retaining talent in the sector to encourage growth.
    3. Common sense regulation:  Reforming regulation sensibly to drive competition and improve the tourism offer for visitors.
    4. Transport: Forging innovative links between the transport and tourism sectors to help visitors travel outside of the capital.
    5. An improved welcome: Delivering a world class welcome at the Border.

A few weeks ago I wrote a blog post about the mismatch between Britain’s standing as a global brand (3rd) and as a place extending a warm welcome to visitors (13th) – so it is gratifying to see that improving that welcome forms part of the Government’s new plan. I hope that improvement doesn’t just focus on the “Border” however – because our visitors clearly feel there is room for improvement generally.

Image: People 1st
Image: People 1st

The focus of the new plan is encouraging because it also highlights skills and jobs – and I hope I am not the only one to make a connection between this topic and the quality of welcome!

With People 1st also highlighting the extent to which a lack of so-called ‘soft’ skills is holding back career development (see graphic) and – AND – the fact that a 1% increase in productivity could drive an additional £1.43 billion revenue to the industry, it seems blindingly obvious that there is a MASSIVE opportunity here.

To illustrate that opportunity, here’s a quick anecdote: earlier this week I had a meeting in a newly-built hotel here in Kent. The hotel is contemporary in style and has been set up with an obvious focus on the business market. My colleague arrived before me and was informed that the cafe bar was not open yet, but that free coffee was available in reception.

During the course of the two-hour meeting, we each had two cups of free coffee, whilst seated in the cafe bar. The barista busied himself behind the bar – yet at no point did he engage, either with us, or with the six other people who were also there. Towards the end of the meeting we remarked that, had he offered us ‘proper’ coffee and a muffin or pastry, he would certainly have made a sale of at least £5 per head. Had he approached everyone in the bar with the same proposition, it’s reasonable to think that he could have more than recouped the cost to the hotel of employing him for the first three hours of the day!kings-square-phase-one-complete

The conclusion, then is simple – there are some key opportunities which I believe we should embrace with unprecedented energy and focus:

  • The National Living Wage is an opportunity to start changing the image of Hospitality and Tourism from a low-wage, low-skill sector to an exciting and rewarding profession
  • We must ensure that the Skills : Productivity equation (including the benefits of improved retention and engagement) is communicated to employers effectively and relentlessly
  • We should see “improving the welcome at the Border” as an opportunity to reimagine what the total GREAT Britain experience should look (and feel, and smell, and sound) like. As I said in my previous post, if we are ranked 13th in the world for welcome, there is no point repeating what we’re already doing and expecting different results. Let’s start at the Border (for now), and then imagine how we create a welcome that is worthy of our top three global brand status 

So what next? A new group is to be formed to co-ordinate and align action across government; a joined-up approach is clearly to be welcomed, as the fragmented nature of both the wider Hospitality and Tourism sector is an obvious challenge. I’m sure too that key industry bodies will feed into that group, and to and from their members. I hope that, in doing so, they – and the majority of employers in particular – will be bold, iconoclastic and energetic in taking our great industry to higher ground.

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