Hotel expansion leads to talent contraction

Two weeks ago today, at or about 11 o’clock in the evening, I arrived in Canaan. The Golden Tulip Canaan to be precise. It’s a brand spanking new hotel that is less than 2 months old, built in the heart of Kampala’s Nakasero district. Having arrived late in the night the hotel’s unmistakable silhouette could be seen from a distance due to the exterior glowing LED lights cleverly positioned to create a picture frame on the entire front of the edifice. A very friendly staff checked my tired bones in but not even exhaustion could stop me from appreciating what a new hotel smells and feels like in the beautifully furnished rooms and spacious bathrooms. But the promised land of four-star hospitality came to a crashing halt the next morning at breakfast.The receptionist had informed me that breakfast would be served from 6:30 a.m. but having walked in at 7:00 a.m for a client breakfast meeting, I found little sign of life or food in the dining room. It went down Joshua’s hill from that point on and only a fairly responsive manager helped to stem the unraveling crisis that ensued.

On that same morning, this newspaper in an article titled “13 new hotels to enter Kenya in next 5 years” quoted a PriceWaterhouseCoopers (PWC) Hotel Outlook report that predicted 13 new hotels opening in Kenya by the year 2021 which would add 2,400 rooms and expand hotel capacity in Kenya by 13%.This creates an oxymoronic impact: good news for the industry, bad news for the industry. The good news is the fact that Nairobi’s continued growth as a regional business hub and conference destination could only be sustained with the necessary supporting infrastructure of an expanded airport, feeder roads and international business grade hotels.

The impending entry of international hotel brands such as Sheraton, Mövenpick, Ramada, Hilton, Best Western, Radisson and Marriott is a testimony to the country’s growing international business stature and provides an excellent opportunity for overall service in the hotel industry to upscale. The bad news is the fact that such rapid growth in the same industry will lead to significant movement of experienced hotel staff in an extremely limited four and five star hospitality segment.

Business human resource strategies take one of three forms: build, buy or a combination of both. A build strategy may be more cost efficient in the short term as the organization hires low experienced staff but it requires massive investment in training to up skill employees to the service levels required. A buy strategy is effective in the short term as the organization hires experienced staff typically at a premium over their current salaries at their existing places of work. But such premiums add a cost to the overall payroll and create discrepancies in pay scales for staff at the same level within the buying organization. A combined strategy allows for a careful balancing and targeted acquisitions, while ensuring the “bought” resources are embedded as part of the training strategy required to maintain the service levels.

Whatever the HR strategy, existing four and five star hotels will have to adopt a defensive mechanism to stem the impending talent attrition.Throwing money at this problem is not a viable option as our hospitality industry is still recovering from the effects of terrorist attacks and the subsequent travel advisories leveled against Kenya in the last four years. This will require some scratching of heads to find and develop golden handcuffs to lock down experienced and talented resources while also preparing to lose the second layer beneath them who are chomping at the career growth bit and are the obvious targets for new employers. The good news is that Utalii College should see a resurgence in activity and demand for training from new recruits.Even better news is that there are now homegrown options for the many Kenyans working in the Middle East hospitality hubs of Dubai and Qatar. For all the money used to build a hotel, the last thing a hotel investor wants to create is my recent Canaanite experience: all the lights are on, but no one is home. People drive a business, not just posh facilities.

Carol.musyoka@gmail.comTwitter: @carolmusyoka