Looking to Reduce Turnover? Start with Manager Training.
Ask any hospitality trainer and they’ll tell you one of the biggest concerns they face in today’s market is understaffing and high employee turnover rates. It’s happening large scale across the hospitality industry, and the trend doesn’t appear to be letting up anytime soon with unemployment rates remaining as low as they’ve been since the 1960s.
CHART and Black Box Intelligence’s recent report, Trends in Hospitality Training & Development 2019, supports this trend. Sixty-nine percent of restaurant respondents reported they are understaffed in front-of-house hourly positions and had a 94% annual turnover rate… and that is doing well compared to back-of-house rates. Ninety-three percent reported they are understaffed in back-of-house hourly positions with a 105% annual turnover rate.
The hotel & lodging markets, while not as volatile, reported 52.2% turnover for front-of-house employees and 53.3% turnover for back-of-house employees.
When you estimate that it costs around $1,800 to train each new hourly employee, the question on everyone’s mind is, “How do we retain the staff we already have?”
Thankfully, the CHART/Black Box Intelligence study is giving us a much-needed roadmap, starting with one key area that has been shown to significantly improve employee retention across all organizations: focused manager training.
According to the study, increasing manager training in two key areas, leadership development and human resources topics, resulted in a notable decrease in turnover rates for hourly employees. In fact, organizations that spent more than 10% of total manager training time on leadership development and/or HR topics saw reduced turnover rates ranging from 25-35%.
Using Leadership Development to Retain Employees
Good leaders inspire and encourage team members. So, when you invest in leadership development training, you’re giving your managers the skills they need to effectively motivate teams and manage people. This helps them build a team that has great success and job satisfaction, which often translates to longevity with the organization. It also shows employees that growth opportunities exist within the organization. Pacifica Hotels and Flatbread Company are two organizations that have seen the value of developing leaders from within.
“We have countless examples of team members that have been able to grow from within – I’m living proof of that.”
– Alie Gaffan, Vice President of People and Culture, Pacifica Hotels
“I started out in operations,” shares Alie Gaffan, Vice President of People and Culture for Pacifica Hotels. “Twenty-five years later, I’m an executive with the company. We understand providing that opportunity for growth and development is critically important to employee satisfaction and retention.”
Flatbread Company also sees the value of developing its leaders. They start by seeking leaders during the hiring process that are the right fit for their culture.
“At Flatbread, we actually have very low management turnover. This is predominantly due to the culture we foster at our company. All new managers must go through a leadership workshop series modeled after the book, Servant Leadership, before they can advance in management.”
– Jason Lyon, President of Flatbread Company
In 2020, Flatbread Company plans to overhaul this workshop to incorporate additional leadership philosophies such as Heart-Centered Leadership.
At Pacifica Hotels, they too help managers from all levels through their company build their leadership skill set early on. “We use DiSC to help our managers learn what their leadership tendencies are, their personality style and their overall approach to leadership,” continues Alie. “This allows them to first start with themselves, and then put that into the context of managing, coaching and providing career development opportunities to others.”
Pacifica Hotels is in the process of launching a new formal management development program through a partnership with the American Hotel & Lodging Association and its apprenticeship program. This allows employees to keep their full-time job while integrating components of their management development program and earning their certification with the American Hotel & Lodging Association.
“It’s not always easy to do these types of things when you’re not a ginormous franchise because you don’t have all those players or have the luxury to pluck someone out of a hotel and put them in a program for six months or a year,” shares Alie. “So, we got creative and identified a way to have the best of both worlds with this program.”
“With such a super tight labor pool, we absolutely have to do everything we can to build bench strength with our employees. When you see people around you growing in their role, it builds a genuine loyalty and commitment.”
– Alie Gaffan
Human Resource Discussions Lower Employee Turnover
Another area the CHART/Black Box Intelligence study showed as a place to help lower employee turnover is human resource training. Our social landscape is and will continue to change, and topics such as discrimination and harassment have been hot-button issues over the past few years. But being well informed, understanding and sensitive to these topics can go a long way toward improving workplace culture and an employee’s desire to stay long term.
Jason Lyon shared how Flatbread is addressing these HR topics head on and the impact it is making in their organization. “In 2018, we rolled out our first Harassment Prevention program online for both hourly and management team members. In 2019, we added this to our on-boarding practices, and in 2020 we will be conducting annual instructor-led workshops that all must attend in addition to the online training. This training includes sexual and discrimination prevention and reporting training.”
This past summer, Flatbread Company introduced a “We Care Hotline” including an e-dress that is available for all team members to call/email with questions or concerns. “Our ‘We Care Hotline’ is working very well,” shares Jason. “It isn’t intended to be the first stop if there is an issue – we still expect that they go to their managers first. But if team members don’t see action or aren’t getting feedback from their management team, then the next step is to reach out to us directly. Or if it involves harassment with the manager, then it gives employees someone to go to.”
Instructor-led Training Also Helps with Employee Turnover
The CHART/Black Box Intelligence study data showed that the way training is administered for managers also matters. Companies that allocated at least 25% of their managers’ training to instructor-led settings had an average front-of-house turnover rate that was 46% lower, back-of-house turnover that was 30% lower, and management turnover that was 12% lower than companies that didn’t.
“Through discussion, you discover situations that managers have been in already that they were unsure if they handled correctly or maybe didn’t handle at all,” shares Jason.
“Classroom settings provide instantaneous feedback, greater engagement, and the ability to learn from each other. When you can use an example that those you’re trying to instruct have lived through, it resonates to a greater extent.”
– Jason Lyon
Pacifica Hotels spends time utilizing webinars for some of their instructor-led training and incorporates role playing into the mix. “We hold a monthly webinar series for our managers and make them interactive,” shares Alie. “We make them interactive through the chat box where people ask questions and we work it into our discussions. For example, we recently had a great example from a manager that we wanted to share, so we opened up his mic and let him speak to the group.”
In addition to in-house training, both Pacifica Hotels and Flatbread Company utilize CHART’s competency courses and powerful networking opportunities to help their employees move forward in their career growth.
“Flatbread brings a group of managers with them to CHART twice a year,” shares Jason. “We find it helps open their eyes to best practices by other companies, but they also learn skills of training that they don’t necessarily learn coming up through the ranks of operations and in-house management training. But beyond training, CHART conferences are highly immersive and provide valuable networking. Every time we get a debriefing from one of our managers, they have found attending the conference is a career and life-altering experience and they want to go to the next one.”
“Invest in your workforce. You can only be as successful as you’re willing to invest in your team members.”
– Jason Lyon
Bottom line, you have to invest in management training and leadership development. “Our workforce wants to learn,” shares Jason. “They want to continue to grow so they can feel valued not only within the organization but as individuals as well.”