Future Hospitality Leaders – What Do You Need?

26/03/2018By Lesley Reynolds
The purpose of this research was to better understand how current hospitality leaders perceive what will be needed from future leaders in 8 to 10 years from now, in order that they might identify the management candidates with the highest potential and nurture them to become the best possible leaders for the future.

 

By Frank Gueuning & Annick Darioly

 

Les Roches Global Hospitality Education – Switzerland, in collaboration with psd Group

Abstract

Globally, the hospitality industry is growing. It is growing both in its existing markets and by expanding into many new markets and geographical locations.  The growth rate is such, there is a shortage of qualified managers. The concern is that with a current shortage in an already growing sector, there won’t be the talent to adequately lead the sector in the future. The purpose of this research was to better understand how current hospitality leaders perceive what will be needed from future leaders in 8 to 10 years from now, in order to identify the management candidates with the highest potential and nurture them to become the best possible leaders for the future.

One hundred and thirty-five senior hotel executives living and working in diverse geographical areas assessed the importance of 43 leadership qualities (including communication skills, self-management, strategic thinking and crisis management skills) in 2025 compared to today, on a scale from 1 = less important to 5 = more important. They were also asked to give their perception of the level of disruptiveness needed in the industry.

The findings showed that disruptiveness and innovation are set to become increasingly important to drive the business to become revolutionary: the hospitality sector needs disruptive thinking. In terms of leadership qualities, the respondents seem to overwhelmingly agree that future leaders will likely have acquired the right skills and knowledge to succeed. Of the 43 qualities assessed, 18 will require the most change for potentially successful future leaders in order to become the drivers of disruptiveness. We found that in general, a future leader will have to become increasingly flexible, adaptable, be able to manage cultural diversity, be even more adept at change management and be disruptive enough to be creative and innovative to the point of becoming revolutionary!

Overall, the findings demonstrated that tomorrow’s leaders are set to become drivers of disruptiveness with a more humble leadership style.

For this research, we teamed with psd, a leading international professional executive recruitment consultancy, and surveyed hospitality managers and executives during the Autumn of 2017.

Methodology

Our methodological approach was based on the competency framework for hotel general managers (Table 1) developed by Bharwani and Talib (2017, p.408)1. This framework was the most appropriate to assess the future leaders’ qualities and consists of 43 qualities categorized into four broad dimensions:

  • Meta competencies: traits and motives – know how to be, adapt and apply existing competencies or acquire new competencies.
  • Social competencies: interpersonal attitudes and behaviours – know how to interact
  • Functional competencies: job-specific technical skills – know how
  • Cognitive competencies: conceptual knowledge – know what.

The two first categories can be considered as personal skills and the last two as occupational skills.

Table 1: The competency framework adapted from Bharwani and Talib (2017, p.408)

We used these 43 items in order to assess the importance of leadership qualities in 2025’s world compared to in today’s world on a scale from 1 = less important, 3= same importance, to 5 = more important. Moreover, we assessed the perception of the level of disruptiveness needed in the industry on a scale from 1 = strongly disagree to 5 = strongly agree.

Respondents

This survey was completed by 135 (103 male, 32 female) senior hotel executives (e.g., CEO, COO, General Managers, SVP Operations and group HR directors), at property and corporate level. Respondents were mostly between 46 to 55 years old and came predominantly from Europe, and then Asia, North America, Far-East and Middle East, and worked principally in UK and Asia. The majority of the executives have a Bachelor degree, followed by a Master’s degree or a diploma. They work for a hotel chain or brand and most have more than 300 employees.

Since research 2 has shown that leadership qualities might be influenced by the geographical region in which leaders operate, most of our analyses compare responses from the geographical areas in which people reside and presumably work (Figure 1).

Today’s leaders help identify the right potential future leaders

“More will be needed from future leaders!”

And perhaps that:

“The egocentric style will be out and will make room for a humbler leadership style”

Starting position

One thing is clear, the new leaders will need to address future uncertainties and complexities in an increasingly dynamic hospitality industry witnessing many changes.
On the one hand, the changes are powered by the current and future needs of the millennial’s and generation ‘Z’ and on the other hand the rise of the sharing economy and indirect distribution channel dynamics. These aspects are forcing businesses to look for new opportunities, to realign their strategies whilst remaining true and credible to their stakeholders.

The continuing pressure of change requires new leaders to be dynamic and evolve to manage them. With such a landscape, the ability to anticipate and respond to changes will also call upon the ability to collaborate with specialists. This in turn will require future leaders to be increasingly cooperative and versatile.

It is also understood that at the most senior level in the business, there is a link between a new leader’s personality, entrepreneurial orientation and strategic changes thereof. Also understood is that to consolidate on strategy, internal candidates are preferred and that to allow for increased disruptiveness and entrepreneurial orientation, new senior executives are recruited from external sources.

Such assertion can imply that recruiting from unrelated industries could also prove to be a game changer in the pursuit of real innovation, perhaps even revolution! Could this be the reason why non-hospitality industries recruit from top rated hotel schools around the world to fulfil their needs in domains such as luxury retail, financial services and airlines and all simply because, hospitality graduates provide an innovative and entrepreneurial orientation that can add the ‘service’ and ‘experience’ dimensions to their respective core activities?

Another set of uncertainties for current hospitality leaders

Globally the hospitality industry is growing in many new markets and geographical locations and the growth rate is such, that there is a shortage of qualified managers. As a result, the industry has applied itself at finding solutions and HRM brought to us ‘talent management’ and ‘succession planning’, thus focussing on career progression to management level. Perhaps however, these solutions are not able to identify the right future leaders early enough.

To corroborate this view, a quick overview of talent management and succession planning suggest that neither one nor the other be the right tool to identify that new future leader is the reason for this is because talent management and succession planning are typically crafted as a way to improve employee retention and engagement with the ultimate outcome of nurturing talent for future management positions. The potential pitfall of such actions are that we prepare our employees to fit corporate culture and that ‘the fit’ curbs their entrepreneurial orientation, which is what we expect of future leaders!

The leader’s innovative mind-set

Bill Gates is famously quoted for saying: “Innovate or die”!

The hotel industry has gently evolved over many centuries and in recent times at an incrementally faster pace. However, one could argue that the hospitality industry has been tinkering with innovation without being revolutionary.

Yes, we have new products, new designs, new concepts and we are living the digital disruption by integrating artificial intelligence, augmented reality and so on, but is that genuine innovation or is it simply delivering better solutions for changing needs as a natural reaction?

Has hospitality been revolutionary?

A quick look back at revolutions, perhaps they were 2 major ones in the last 100 years!
The first being the creation of hotel chains with centralised multi-property reservation systems during the 20th century and the second more recent major revolution which was the digital disruption which commenced at the tail end of the last century.

For hoteliers, the early steps of the digital disruption were somewhat a missed opportunity because hoteliers were true traditionalists and perhaps forgot to be proactive when it mattered. ‘Easy to say now’ you are thinking! Perhaps it is, but let’s think back of the beginning of OTAs in the mid 90’s; we omitted to take ownership, were not savvy enough, could not see the real potential and also perhaps were too proud to sell our rooms at a lower rate with a larger commission than the traditional 8% to travel agents! Such apathy means that today, instead of being the main online actors, we have become the spectators and recipients of the services of the online industry and are paying a price for it! Of course, the hospitality industry is great at responding to threats, and there is a revival of the direct distribution channel strategy but that is not being revolutionary, it is again evolutionary reactive manner.

Another digital disruptor is the growth of the sharing economy, with players such as Airbnb, which is set to remain a major force for the foreseeable future. However, such disruption has its limitations as it is designed to facilitate a transaction rather than providing for an experience. It is conceivable that the two models will remain complementary, each with their distinctive capability.

Just this little look back further demonstrates that new leaders will have to be identified correctly and early enough and that current leaders will have to find ways to preserve their innovative mind-set and entrepreneurial orientation.

Disruption: Good cop or bad cop?

In order to answer this question, we surveyed the perception of the level of disruptiveness and it has proven to be very conclusive.

Our respondents clearly and globally shared the views that disruptiveness and innovation are set to become increasingly important to drive the business to become revolutionary. The hospitality sector definitely needs disruptive thinking (Figures 2 to 5).

Our survey also revealed that there is a significant requirement to change hospitality tradition as those traditions are no longer seen the key to effectiveness. What remains unanswered is understanding if external input from non-hospitality professionals could be a game changer. When asked if a non-traditional hospitality industry background would enhance success, the respondents seem to be undecided; perhaps, and only as speculative comments, because there is an element of protecting the industry from within or perhaps there is a lack of confidence in challenging the norms and seeking real change from bringing non-hospitality expertise as driver to good cop!

Competencies of potential drivers to disruptiveness?

Our survey aimed at finding indicators that could shed light in identifying the right future leader and our analysis revealed that none of the competencies needed today to succeed will become less prevalent in the future.

Status quo?
Far from status quo, in key competencies, the future leaders will have to become more effective and the changes would suggest that the future leader will be a different leader.

At a glance:
The respondents seem to overwhelmingly agree that future leaders will have mostly acquired the right skills and knowledge to succeed. It also became clear that all respondents foresaw that future leaders will have to be innovative and creative in product and services development and excel in driving quality. The belief in innovation, creative thinking, certainly do link up with the disruptiveness expected in the future. Also noted was the underlying trend that future leaders will have to become increasingly adept and surf owner’s relation with improved agility.

Of the 43 items assessed we have identified the ones – 18 of them (Table 2) – that will require the most changes for the potentially successful future leader, driver to disruptiveness.

Table 2: Competencies needed for future leaders – Globally approved

In general, a future leader will have to become increasingly flexible, adaptable, be able to manage cultural diversity, be even more adept at change management and be disruptive enough to be creative, innovative to the point of becoming revolutionary.

In more detail and focusing at the personal skills namely the meta and social competencies, the survey reveals that future leaders are more likely to shine if they display qualities more closely relating to traits and attributes such as: remaining calm and confident in face of provocation and adversity; seeking out and accepting additional responsibilities and; acting in an honest and trustworthy manner whilst being adaptive, flexible, open and willing to learn (Figure 6).

Figure 6: Meta competencies divided by geographical areas

Coupled with that, we have also found that for the social competencies, the future leaders will have to become even better prepared in communicating and engaging in cross-cultural encounters while displaying cultural sensitivity and mindfulness, whilst having the willingness to develop others (Figure 7).

Figure 7: Social competencies divided by geographical areas

Although we are moving away from tradition and we are working in an environment where soft skills are required more and more, we should not forget that future leaders will need to be technically competent (Figure 8) and have specific knowledge (Figure 9).

Without surprise, in a such digitalized and interrelated world, basic computer literacy skills and knowledge of operations management systems such as hotel property management systems, as well as the ability to engage with internal and external stakeholders and to understand customers’ perceptions of value are seen as more and more needed.

Figure 8: Functional competencies divided by geographical areas

The 4 cognitive competencies shown in Figure 9 are seen as overall game changers. Future leaders will need to deal with change, energise the change process by removing barriers and reach solutions on the basis of observation, analysis and evaluation. On top of this, the ability to anticipate emerging opportunities and being challenging is crucial.

Figure 9: Cognitive competencies divided by geographical areas

With regard to the UK answers it would appear that the Brexit uncertainties are biasing these answers. We did not attempt to address this variable in the survey and an improved ability to change and less focus on strategic thinking would certainly infer that view. Despite this, not all respondents agree that the future leader ought to be creative, innovative disruptive in the quest for a revolution.

If these results were as expected, what is perhaps more important and could be the precursor to real change in the perceived shape of the future leader, is the near status quo of competencies such as decision making, system thinking, planning prowess and risk taking. We illustrate the marked differences in the Figure 10, ignoring countries of residence.

Figure 10: Differences in cognitive competencies

Towards Sharing leadership with humbler leaders

To conclude, these findings point towards validating the cause of ‘sharing leadership’; a theory developed in the early part of the millennium, where leadership is shared among, and stems from team members to ensure that individual complexities are addressed and overcome by experts. This shared leadership give more access to disruptive ideas, which is what the industry needs. So, tomorrow’s leaders seem to be drivers of disruptiveness, with a humbler leadership style.  They are confident enough to share their power with others.

1 Bharwani, S., & Talib, P. (2017). Competencies of hotel general managers: A conceptual framework. International Journal of Contemporary Hospitality Management, 29(1), 393-418.

2 Gelfand, M. J., Erez, M., & Aycan, Z. (2007). Cross-cultural organizational behavior. Annual Review of Psychology, 58, 479-514.

About the author

Lesley Reynolds

Managing Director – Hotels, Leisure & Travel

Lesley heads psd‘s Hotel, Hospitality, Leisure & Travel sectors at board, senior executive and management level on a global basis. She is very active personally delivering executive search and senior assignments across these sectors.