Retention Strategy for Restaurants and Hospitality Employees

Although it has always been a significant concern, there has been a consistent rise in turnover rates for restaurant employees over the past few years. Findings from the Bureau of Labor Statistics indicate that over 6% of employees in the hospitality sector leave monthly while the yearly turnover rate is 73.8%. The figures by themselves are a cause for alarm, but the impact of the turnover on the hospitality industry is even more significant.

On average, restaurants and other businesses in the hospitality industry lose $5,864 on every employee turnover. If you have 500 employees, with the current average turnover rate in the industry, you can lose upwards of $2 million annually. This is a vast amount of money that you could channel towards more meaningful initiatives such as upgrades and marketing.

While it is a problem that has plagued this industry for a long time, it is only getting worse given the current unemployment rate. If you consider all factors, it is easy to understand why employee retention for restaurants and companies in the hospitality sector is challenging. It is for this reason that we have developed this retention strategy for restaurant and hospitality employees.

Incentivize Long-term Employment Using Benefits

Employee benefits remain a significant factor in retaining your current employees and attracting new talent regardless of your industry. Healthcare and retirement benefits are vital.

Retirement Benefits

Most employees make the decision to work with a company based on the retirement benefits the company offers. Additionally, almost half of the employees decide whether to stay with their current employer after considering retirement benefits. Retirement benefits are a unique incentive to long-term employment. By utilizing the employer match combined with a unique schedule to provide incentives for employees, it is possible to get employees to stay with your company even during retirement. Employees want to know that a company is working towards providing a secure financial future before committing to their long-term futures.

It is clear that retirement benefits are an essential element, but most businesses in the hospitality industry do not offer solid retention benefits through retirement plans. There are lots of challenges such as the increased burden on the human resource department and low employee participation. One of the most common scenarios is a case where a highly compensated employee is usually limited in relation to the 401 (k) contributions as a result of failing the non-discrimination test and poor participation. Often, this culminates in increased turnover rates in relation to the highly valuable employees that can be hard to replace.

Healthcare Benefits

Healthcare benefits are another vital element in avoiding employee turnover. Before deciding to work with your company, almost 46% of employees consider the health care benefits package you offer. This is according to a Willis Towers Watson study, which also indicates that 55% of the employees view healthcare benefits as an important factor towards staying with their current employer.

This should not be surprising considering ever-growing medical costs. Although employees need to understand that their futures are covered, they also want to know that their present is well taken care of. Coming up with a solid healthcare plan remains one of the best ways to achieve this.

Integrate Technology

Embracing technology can help you reduce the turnover rate of your hospitality business in two ways.

Reduces Workload

Naturally, businesses in the hospitality industry feature a constantly busy environment. Employees often have to juggle between different tasks at the same time, which can have a significant impact on employee morale and productivity.

By integrating modern technology into your business practices, you allow some of the tasks to be delegated to automated systems while employees manage the essential tasks. With less work to do, it is easier to keep employees motivated, which contributes to employee retention.

Improves the Overall Work Environment

Effective integration of technology creates a highly efficient work environment. It takes less time to process tickets which contributes to customer satisfaction and streamlines BOH and FOH. It becomes easier to achieve lower employee turnover rates by creating an enjoyable working environment for employees in the hospitality sector.

Retaining Restaurant and Hospitality Employees

The high employee turnover rates continue to plague the hospitality and restaurant industries. Through poor employee retention, companies lose thousands of dollars on individual employee turnover every month. There is an urgent need for lasting solutions to mitigate the impact high employee turnovers have on the industry.

Companies based in the hospitality and restaurant industries need to provide incentives geared towards getting employees to commit to a future with a company. Providing incentives such as retirement and healthcare benefits can have a positive impact on employee turnovers. Similarly, integrating technology into your business practices can also contribute. It reduces the amount of work the employees have to do and provides a comfortable working environment that contributes to employee satisfaction.

Recruiting 2021: New Challenges, New Opportunities

The COVID-19 pandemic brought the entire nation to its knees. Large businesses sent staff home, some to work (many with slashed salaries), and some without a job. Small businesses disappeared entirely. Those fortunate enough to have a job tried to adapt to the new “work-from-home” routine. And those newly laid off or furloughed attempted to figure out how to look for a new job during a pandemic.

The workplace culture — and the hiring/recruiting practices essential to populating that culture — arguably has been changed forever.

Whether you are looking for staff, or looking for a position, it will be challenging doing it alone in the emerging post-pandemic world.

  • For corporations, especially, it is essential to make Human Resources part of your business strategy, not just an afterthought.
  • Individuals, meanwhile, need to ensure their job searches — and the way they present themselves — is consistent with the skills and experience important to companies in the new workplace environment.

Here are some insights into the new reality.

The Macro Situation

  • A huge number (41%) of individuals who suffered a job loss have been unemployed for almost a year now, resulting in a crowded applicant market. The S. had approximately 23 million unemployed last April and the current number is still about 10 million.
  • According to Statista, 47% of companies discouraged remote work and required employees to show up in the office before COVID-19. However, the past year saw even the most rigid employers allow staff to work from home. Now, almost 44% of companies have shifted to full-time remote work.
  • According to Gallup, 59% of American employees who have been working remotely during the COVID-19 pandemic would prefer continuing to work from home as much as possible, after public health restrictions are eased.

Employer Hiring Challenges

For employers, the go-forward challenges are significant.

  • Companies that previously laid off workers need to be concerned about lingering negative perceptions that may exist among employees/applicants.
  • Employers that shifted to an office-less framework need to determine a set of traits that remote employees should possess and add new stages to the hiring process, such as behavioral and aptitude tests.
  • Large unemployment numbers likely are causing a huge number of applicants — many unqualified — and employers can waste a lot of time simply reviewing and trying to determine qualified persons.
  • Candidates increasingly are concerned about their health and safety. Employers have to validate that they’re going beyond just staying compliant to reduce fears so that employees will feel safe returning to the office.
  • Employers will have to audit existing hiring processes, determine what had been working in the past, what hadn’t been working, and figure out how the new normal is going to change their recruitment strategies.
  • They also will have to adapt their sales pitches based on additional benefits that they may be offering. For instance, the commuter stipend is no longer useful so they may have to introduce better home office setups, childcare benefits, and other wellbeing benefits.

Employee Search Challenges

Individuals, meanwhile, have new concerns that didn’t exist prior to the pandemic.

  • Many have determined in the past year that remote work fits their personal and professional needs and are interested in continuing on that track. However, they also would be interested in not limiting the number of opportunities that are presented to them.
  • They are also afraid that the new normal no longer includes jobs that clearly fit their pre-pandemic talents. And they may have to learn new skills to pivot.
  • The glut of applicants can easily cause qualified applicants not to get noticed by prospective employers. With remote working becoming the norm, they may even have to face competition with a geographically diverse pool of candidates.
  • When returning to the workplace, individuals may face different health risks depending on the kind of work they do, where they do it, and their own health conditions.
  • They might feel apprehensive about working with a company that made hundreds of employees redundant in the past.

Moving Forward

Skilled and experienced recruiters provide an important solution for employers and job seekers. Identifying, recruiting, interviewing, and onboarding aren’t the only tasks a recruiter needs to provide in 2021. New skills needed include virtual interviewing and assessment, virtual background checks, virtual hiring, and also reshaping an employer’s identity. Most importantly, the right recruiter is focused and aligned with the employer’s goals.

At Incipio Workforce Solutions, we learned a great deal in 2020 and turned that experience into better systems, processes, and procedures to help our clients achieve their objectives. For example, many companies realized the six-month or yearly performance review no longer was effective. We’ve developed much better ways of setting goals and tracking effectiveness on both a personal and professional level.

Want to know more about Incipio? Get in touch with us right away to learn how we can help you achieve your goals.

Protecting Your “Valuables”

When you look at your balance sheet, you’ll likely see payroll is your greatest expense. So it only makes sense you should treat your people as your most valuable asset. But how do you do that and “protect your valuables?”

Keep employees engaged

It’s important your employees feel they are part of a team. So how do you accomplish that? With confidence and clarity! I believe in vulnerability and transparency. That means you share exactly where your company is heading and you are clear about the organization’s goals. That helps put everyone on the same page and provides an understanding of how they impact the business. That doesn’t mean as a leader you have to let everyone know the financials. But being clear about the greatest challenges and opportunities within the organization ensures everyone is on the same page.

Develop open lines of communication

How you communicate with employees can be different for different organizations. It might be email blasts, text messages or blog posts on a company Facebook page. Or maybe townhall meetings or weekly “touchbase” sessions will work best for you. However you accomplish it, it’s crucial you keep those lines of communication open and vibrant. The most motivated employees know their voices are being heard.

 

Invest in your people

I’ve talked a lot in the past about the importance of ongoing learning and professional development. Investing in your people will improve your organization’s performance and it will help in retention. There is a perception people leave a job purely for a bump in their base salary. I don’t believe that! I find people are much more likely to leave an organization when they feel their current employer is unwilling or uncommitted to professional development.

I think this quote from entrepreneur Richard Branson puts it quite well: “Train people well enough so they can leave, treat them well enough, so they don’t want to.”

Task Lists Are Not Enough – Identify, Prioritization, Diligence, & Accountability

I don’t know how you feel about the current state of things in our world, but for me, I’ve got a lot going on.  Like, a ton of things.  I’m hearing similar feedback from others in my field and from professionals in numerous other industries.  2020 was the “hold my beer” of unprecedented change, and 2021 is shaping up to be a remarkably similar operating environment.

Yes, we know stuff happens.  All day, every day.  At home, at work, and at work from home.  “If you’re not changing/evolving/moving forward, you’re: insert downside statement here:”, yeah, we’ve heard all of the variations of that one.  But let us be honest, this all feels extremely different.  Proactive, planned change is not the same as the current trend of reactive, “rebuild the plane while we’re flying it” change.  So, what is an organization to do?

Identify the Target(s) & Define The Actions:

The all-encompassing “let’s fix stuff!” statement, while no doubt well-intentioned, can seriously hinder your teams’ ability to execute real and lasting change and improvement.  What needs to be fixed, and according to whom?  Understanding where you need to focus your time and energy while looking at dozens of opportunities is critical right now.  Pick your battles carefully, get buy-in an alignment from your team on the chosen tasks and initiatives, and clearly communicate what is going to happen.

Prioritization Drives Focus

Change management doesn’t operate in a vacuum.  We all have our day jobs, the critical core competencies and tasks that must be completed to serve our internal partners and our clients.  What does that mean?  In terms of change management, it means that we’re carving time out of what we’ve already committed to do each day to in order to improve how we do things, and the quality of our outputs.  Figure out what is most important, and get all eyes, hearts, and minds focused on the prize.

And I am most definitely not saying that you can only work on one thing at a time.  Not at all.  What I am saying though is that you can most definitely have problems getting traction or maintaining momentum when you’re trying to do too much at once, or if the focus and energy is constantly being realigned to non-prioritized tasks and initiatives.  Which leads to our next item…

Be Diligent and Protect Your Priorities – Learning to Say “No”, Or At Least, “Maybe Later”

This is a tough one.  Yes, life gives you lemons, but if you’re already knee-deep in a vat of grapes in your team’s efforts to craft a fine wine, is now really the time to pull everyone out of that process in order to make some lemonade?  If the risk to the business is lower than then the risk of not getting your top priorities completed, put the lemons aside for a bit and finish the task at hand.  And when I say “put the lemons aside”, what I’m saying is to capture the details of the issue, add it to your tracking list, and figure out where it’s going to fall when you’ve circled back to your task prioritization process.  If it was urgent enough to potentially side-track a high-priority initiative, it needs to be documented and addressed when resources become available to focus on it.

Assuming Nothing When It Comes to Accountability

What specifically must be done, by whom, and by when?  How do you track progress against tasks that may take weeks, or months, to complete?  Is there a specific task order or dependencies within the project that everyone needs to understand?  How is the progress being communicated to the team?  Does everyone have the clarity needed to do what needs to be done?  Do they have the tools, knowledge, and skills to effectively execute?  Do they have the time, and if not, what needs to happen to assist them with finding the necessary time?

Lots of questions, but all of them, and perhaps a dozen others, need to be clearly answered and documented to establish the foundations of accountability and ownership necessary to get things done.  If you don’t have a full-time project manager in your organization, you’re still going to have to find a way to approach the task in a manner that utilizes fundamental project management best practices and principles.  What is the goal, what is the path, what must happen, who is going to get it done, when will the assigned tasks be completed, and how will the changes be validated and firmly embedded in the operation going forward?

Clarity is critical, and the ability to stay focused in today’s operating environment is in my opinion the most important skill that leaders and organizations need right now.  Things are happening, and will continue to happen, that have incredible potential to distract us from the most important tasks at hand, but if we can keep ourselves and our teams focused, we’ll create the “wins” we all need that come from getting the most important ones completed.

Increasing Productivity

One of my primary goals for this month is increasing productivity. Here’s how I’m working on this goal and maybe some of my plans will help you accomplish the same thing.

I have surrounded myself with talent

I think I have the right people in the right seats. Now I have to encourage and support them and let them know I have confidence in them so morale is as high as possible. When employee morale is high, it only makes sense that productivity and the quality of work will be high. Plus, happy employees are less likely to leave for another offer. For any organization, turnover can really slam productivity.

 

I’m determined to delegate

I know what I’m best at and so I’m going to delegate the rest! I’ve surrounded myself with talented people and I’m going to give them the power to make decisions. And then, I’m going to trust in their choices.

 

I’m focusing on time management

I find I can be distracted by “bright, shiny objects.” By that, I mean I can be diverted from what I’m intending to accomplish by distractions – in the workplace or outside the office. So I’m trying to apply some time management techniques. For example, I’m keeping a rough journal of my time to help me stay focused and accountable to my calendar. I look at my schedule for the week and create a list of priorities – even going so far as to number them, one, two, three. I also ask myself every so often to review what I’ve accomplished in the past 30 minutes. It’s amazing how fast a couple of hours can fly by before you know it.

Annual Performance Evaluation: Affirmation And Acknowledgement For A Job Well Done The Last 12 Months

Employees are craving feedback from management. In fact, a recent Gallup survey found more than 70% of respondents want feedback on their job performance on a weekly or even a daily basis. Not only is feedback actively desired, if provided correctly it can have an incredibly constructive impact on the workplace. Studies show regular feedback – both positive and negative – leads to lower turnover and increased productivity.

CREATE A FEEDBACK LOOP

Annual reviews alone won’t meet that need for feedback. We have found annual reviews generally are just a snapshot of someone’s performance in the last four to six weeks. Successful companies have a system in place for regular feedback so the annual review becomes a collection of ongoing performance. 

TECHNOLOGY CAN HELP

Technology can provide you with reminders for performance notes, goal setting and weekly or monthly reports. There are lots of tools and systems available today that create feedback vehicles from self-evaluation to 360 reviews, which include feedback from peers, management and even clients. Self-evaluation is crucial. How does the employee see how he or she is doing? Does the employee have a clear picture of the yearly goals? Then you can narrow in on what really motivates employees leading to successful employee engagement.

THE RESULT

The goal is to create an effective working relationship. Feedback will help you see what is working well and how you can work even better together. It will help you set goals on a monthly and yearly basis. And importantly, regular feedback will help you in succession planning by identifying high performers who will grow with the company as well as helping you see areas where you may need to look at hiring from the outside.

BEGIN WITH ONBOARDING

An effective feedback process starts with an efficient onboarding program. As we discussed in an earlier blog, successful companies set up clear expectations before an employee is even hired. Employees then have clarity around what they do for their day-to-day tasks and have a clear understanding on how those tasks are evaluated. 

The best organizations are made up of people who are motivated by recognition. They are productive employees because they see and hear the value of what they do. As a leader, providing regular feedback is one of the most important things you can to do make sure each person on your team feels valued. 

Building Trust Builds Confidence

It has to start somewhere.

Let me tell you about one of my first jobs. I was in college and working part-time at a call center. This wasn’t intended to be a career path for me, but when I graduated, they offered me a job. That’s when I discovered I had access to some great leaders and mentors. I can tell you any number of stories about how they motivated and inspired me – but here’s one of the most important lessons I learned.

After a few months in my first leadership role, I found myself in my manager’s office for one of our weekly touchpoints. He said I was playing it too safe and that wasn’t why they hired me. Besides being a brilliant leader, he was also very observant.  And he was right.

I was nervous.  While I had full confidence in my ability to perform the role I had been given, I was afraid of making a mistake.  Of being judged.  That’s when he said something that has stuck with me ever since.

It’s About Risk

“There is only one type of leader that never makes mistakes.  It’s the leader who does nothing.”

Then he told me about the biggest mistake he ever made in his career, and how his manager worked with him to learn and grow from it. He encouraged me to take chances and not be afraid to make a mistake myself. He convinced me we would learn from any mistakes and become smarter and better for having made them.

For him to open up and share his worst work experience with me showed his vulnerability and transparency. And most importantly, it showed he wanted me to trust him as much as he trusted me. The point is you can develop loyalty by showing loyalty. That’s how you build trust. 

Think about how much time and money you could save if you create a work environment where everyone feels comfortable sharing opinions and having honest, transparent discussions!

Are you Loyal? The Power of Vulnerability and Transparency

What It Takes to Develop a Partnership

When Incipio meets with a business or organization considering using our services, we make it clear we don’t want to be seen as just a vendor. Our goal is to develop a partnership focusing on results. We want to work together to come up with clear expectations with measurable outcomes.

How do we accomplish that? One of the specific ways is by insisting our relationship is based on transparency. We stress upfront we want honest and frank discussions that will help us focus quickly on areas where improvement is possible and where Incipio can make a difference.  

ASK FOR HONEST FEEDBACK

It’s not easy for everyone. Some see being transparent as a weakness. I don’t see it that way. I’ve found the most successful business people have an understanding it’s okay not to be perfect. I like to call it being “vulnerable.”

Business leaders who take this approach are often the most innovative. That’s not to say you should make your business a democracy. Rather say to the team, “This is the way I see it, but you feel differently about it, let’s have a discussion.”

BE AUTHENTIC

Being able to express yourself in a vulnerable and transparent way is empowering and helps everyone grow stronger. We’re not looking for an argument because that doesn’t change anyone. Instead, we have found what does change behavior is authenticity.

I think being able to express yourself in this way is empowering and is guaranteed to deepen any relationship. We’re not interested in a superficial or judgmental relationship. We want to understand each other with what I call “real talk.” That creates a partnership where both parties benefit and grow stronger. 

Training and Development: Why It’s Necessary!

What’s your biggest asset?

You Already Know.

Have you ever heard a company say, “Employees are our biggest asset?” When I hear that, I want to know what they are doing to back that up. Job seekers, in particular, are impressed if they learn a company is investing in their people to make them more efficient and productive. That’s exactly what great training and development programs are designed to accomplish.

 Attract and Retain Employees

 One of the biggest benefits of a training and development program is it’s effectiveness in attracting and retaining the best employees. Knowing an organization is willing to spend money on training and development not only attracts the interest of excellent candidates, but it will make your current employees feel valued and even increase loyalty. A combination of internal and external training (perhaps collaborating with a local college or university) will pay long-term dividends. It also will improve your reputation in the community which certainly will help your recruiting efforts.

 Build Your Bench Strength

We’ve talked about this…

We’ve talked in other blogs about how disruptive it can be when you have to replace a valued employee. Having a program that trains and develops workers will go a long way to minimize that disruption by providing a smooth transition. A successful training and development program provides you with a pipeline of qualified employees ready to step up and be rewarded with a promotion. You’ll find it’s a lot cheaper than starting over in the hiring process.

 Do Your Research

Survey Your Employees

They know what they need!

Have you thought about surveying your employees to see what they would like to see in terms of training or development efforts? It will give you some great feedback and allow you to tailor a program that is effective and appreciated. You’ll find it will also increase communication, collaboration and teamwork. It’s a great chance for employees to show you skills you didn’t even know they had.