Hospitality employee retention, success and value can be achieved by investing in training. Here’s how to measure ROI on hotel employee training.
It can be challenging deciding whether (and how) to invest in quality training programs for your hotel’s new hires because it’s not always easy to measure the return on investment (ROI). According to a Hotel Business Review article, many of the benefits can be seen upfront. Good hotel employee training not only impacts how your staff interacts with guests and the quality of their customer service, but it also helps maintain costs and ultimately even retain employees. Proper training also imparts the hotel’s culture of service and teaches employees how to up-sell, which increases a hotel’s profitability.
But just how important is it to train new hires more extensively with formal training that familiarizes them with the company and its products and policies in addition to teaching them about their particular position? And how do you measure the training program’s ROI?
Impact on Overall Bottom Line
Whether they’re a front desk clerk, a dishwasher or a landscaper, every hotel employee ultimately affects the guest experience. Training your new recruits on the company’s policies and the hotel’s standard operating procedures from the start — while you teach them how to do their particular jobs — sets them on the right path before they develop bad habits. It’s key to employees being able to provide a consistent level of positive guest satisfaction.
A formal training program also teaches employees people skills, shows them how to work cooperatively and lets you get to know your new hires. Letting new hires know exactly what is expected of them and giving them the tools they need to do their job successfully provides employees with better job satisfaction, and that helps to reduce turnover and the very real costs related to it. One survey from go2 Tourism HR Society found that 40 percent of employees who did not receive good job training left the position within a year, citing lack of skills training and development as their primary reason for leaving.
Staff turnover means spending time interviewing and training new people. When you’re down an employee — and while a new employee is being trained and getting up to speed — productivity and sales can go down. Your other employees may need to work more hours to pick up the slack, which can be hard on morale. It can cost as much as $2,500, depending on the position and location, to replace a front line employee, go2 Tourism found.
How to Quantify Tangible ROI
Learning strategies expert Oliver Tian suggests a simple method of quantifying the ROI of your hotel employee training. Identify a quality you want to quantify — perhaps it’s decreased customer complaints — and attach a monetary value to it. Determine the amount of change in that quality post-training, as well as the cost of training, and then obtain your ROI by dividing the total amount of change by the cost of training.
Or go a little more in-depth, says go2 Tourism: Measure ROI by first determining the outcomes you want to achieve. Then design the training program, considering what type of training will be most useful. In-house, using consultants or online? Will it be a full-day training, week-long or some other length? What types of activities and experience (role playing, hands-on practice or a combination of both) will help trainees learn this job? What kind of support will you need post-training to ascertain the new knowledge and skills are being used correctly?
Next, define your metrics (choosing ones that are measurable in dollars) and determine how you’ll track the training program’s success. Set goals for how you want results to change in the months following training. It’s important to remember that, in addition to ROI, there are other important measures of a training program. Consider how well the training content addressed your company’s needs. Did it set a specific goal, and was that achieved? Are your employees using the skills they learned?
It can take a little time to see a return on your initial training investment, but long-term effects can be worth it. These include ensuring you have qualified and productive workers that are more likely to stick around and help your company succeed. Now that’s a great investment.