The value of investment in Human capital
Federico Moreno-Nickerson, VP of Development at Apple Leisure Group, shares his vision on the importance of investing in training
“Training and development of the work team is an investment, not an expense. Keeping hotel managers and executives up to date with the latest technologies and market strategies can result in higher revenues. "Federico Moreno-Nickerson, VP of Development at Apple Leisure Group, the largest tourism group in the United States and supporting partner of JSF Travel & Tourism School, talks about the importance of investing in human capital.
To ensure consistency in each interaction with guests, the continuous training of each employee, and in particular new hires, is essential for each resort. All employees must know the property in detail, especially the brand promises and procedures necessary to ensure guest satisfaction.
In addition, in countries that do not speak English, offering language teaching courses is crucial for employees to interact effectively and communicate successfully with guests. For many resorts, training can be considered an expense as it increases the already expensive payroll.
This is not the case. In fact, the CBRE's 2016 report Trends in the Hotel Industry report found that the payroll cost and associated expenses accounted for 42.8 percent of total operating expenses in 2015. Although the number is an average cost of United States property payroll is also a strong indicator of a problem faced by many hotels in the world, including several resorts in the English-speaking Caribbean and in Europe, where there are properties that operate under the AMResorts® brands.
Our team has a number of cost control measures, which adapt to the needs of the resort and local government laws. However, ALG also sees payroll costs as an investment.
Payroll costs vs. Investment in training
As noted by Robert Mandelbaum, Director of Information Services Research at CBRE Hotels America Research in an article published in Hotel Management, "to give value to the rising payroll costs, continuous training of hotel employees is essential."
No matter where our hotels are located, we have long shared Mandelbaum's vision that employee training programs can result in increased productivity, improved guest satisfaction and increased revenue as result of the increase in sales and lower employee turnover. As ALG operates the resorts, through the AMResorts brands, in 28 destinations located in 7 countries, we have a greater capacity to focus on the professional and skills development of the managerial and executive levels.
The link between the profitability of the hotel and the investment in mid-level to executive employees is remarkable. These are the team members who decide and execute the strategies to manage income, effective operating systems and budget planning. So it is necessary to attract talent that comes to occupy the position with the support of a solid knowledge and experience.
Through our New Generation Management Trainee Program, we prepare mid-level managers to have the ability to adapt to the operations of the various destinations where we are present.
We keep this group of managers trained to be able to provide adequate personnel to the resorts and make sure that the properties have the tools required to go from initial startup to operational profitability more quickly.
Develop long-term human talent groups
AMResorts, the ALG hotel brand management company, also offers an Executive Development Program for general managers and their direct team; and a Management Development Program for all key members of the operating team of a property. Both programs present a well-defined career plan that will allow them to grow with the company and brands to maintain greater retention among managers and executives.
As Deloitte explains in the What Price Talent report? , "The development of human talent requires longer periods than economic cycles or short-term strategic objectives."
The importance of retaining the team at managerial and executive levels is normally overshadowed by the conversation about problems with first-contact employees.
But the resources and time invested in the development of employees in ALG has resulted in greater satisfaction; Proof of this is the last anonymous survey that registered a 90% satisfaction rate. In addition to employee satisfaction, our corporate culture has been awarded with several industry awards: AMResorts received 4th place in the list of best places to work in 2019 according to CNN / Expansion Magazine.
Recognitions like this, coupled with our training programs, have helped strengthen our reputation as a leading employer in the hospitality segment that offers long-term professional development.
As the Deloitte What Price Talent report points out, “The Return on Talent Investment (ROIT) represents a vision through which the complexities of the financial impact generated by human talent can be considered analytically in retrospective, and turned into a perspective with financial tendency on the part of the corporate leaders and other communities of investors ”. Developing a group of long-term human talent is essential to develop better financial results.
Train on strategies today to grow in the future
The hospitality industry is a rapidly changing business environment and where profitability is impacted by new technologies that reach the market as well as the evolution of shopping habits.
ALG's vertical distribution strategy plays an important role in generating profitability for our owners. But training our managers and executives in cutting-edge approaches to revenue and operations management as well as sales and marketing, enables them to further increase the profitability of the hotel.
We have forged alliances with leading institutions in the world, including Cornell University, with whom we created a Master in Hotel Administration, and with the institute of tourism education in Mallorca, JSF Travel & Tourism Business School to create a three-day executive congress on how to maximize the digital offer that ensures that our team is stronger in key areas of resort management, while supporting its continued development.
In addition to the possibility of accessing a long-term career thanks to our management training programs that we offer to our teams and candidates, it is through these programs that we ensure that our managers and executives are continuously trained in the latest tools and strategies that impact the current profitability of hotels.
Professional development at each stage of promotion
We also recognize that some of the most successful executives have started their career in first contact positions.
Therefore, ALG also has key human talent development programs in all properties that operate with AMResorts brands: a minimum training room, a full-time training manager with an annual training program and an English teacher in non-English speaking destinations.
Beyond these essential elements, ALG has created official training centers in several properties. To cultivate the skills of the operations team and executives of Dreams Tulum Resort & Spa, ALG established an alliance with Universidad Anáhuac in Mexico to develop a curriculum that covers areas such as Sales & Marketing, Advanced Management, Leadership for Senior Executives, Front Desk, Human Resources, Food & Beverages, Cleaning Services, Budgets and more. In 2017, we have trained more than 1,200 AMResorts leaders.
This wide selection of training and development programs are an investment for ALG. They certainly offer an advantage by attracting candidates of the highest levels of talent.
The Deloitte’s 2017 Global Human Capital Trends report found that “companies with dynamic professional development models outperform their peers by providing continuous learning opportunities and a deep culture of development.”
With five active and formal training and development programs and with the potential to implement even more in the future, ALG is a pioneer in professional development in the hospitality industry, offering its owners an unprecedented competitive advantage.