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www.chr.cornell.eduwww.chr.cornell.edu
Vol. 3, No. 7, June 2011
Cornell Hospitality Service Innovation Roundtable
Cornell Hospitality Roundtable Proceedings
Improving the Guest Experience through Service Innovation:
Ideas and Principles for the Hospitality Industry
by Cathy A. Enz, Ph.D.
www.chr.cornell.edu
Cornell Hospitality ReportVol. 11, No. 11, May 2011
Customer Loyalty:
A New Look at the Benefits of Improving Segmentation Efforts with Rewards Programs
by Clay Voorhees, Ph.D., Michael McCall, Ph.D., and Roger Calantone, Ph.D.
Advisory Board
The Robert A. and Jan M. Beck Center at Cornell University
Cornell Hospitality Roundtable Proceedings, Vol. 3 No. 7 (June 2011)
© 2011 Cornell University
Cornell Hospitality Research Summit Proceedings is produced for the benefit of the hospitality industry by The Center for Hospitality Research at Cornell University
Rohit Verma, Executive DirectorJennifer Macera, Associate DirectorGlenn Withiam, Director of Publications
Center for Hospitality ResearchCornell University School of Hotel Administration489 Statler HallIthaca, NY 14853
Phone: 607-255-9780Fax: 607-254-2292www.chr.cornell.edu
Niklas Andréen, Group Vice President Global Hospitality & Partner Marketing, Travelport GDS
Ra’anan Ben-Zur, Chief Executive Officer, French Quarter Holdings, Inc.
Scott Berman, Principal, Real Estate Business Advisory Services, Industry Leader, Hospitality & Leisure, PricewaterhouseCoopers
Raymond Bickson, Managing Director and Chief Executive Officer, Taj Group of Hotels, Resorts, and Palaces
Stephen C. Brandman, Co-Owner, Thompson Hotels, Inc.Raj Chandnani, Vice President, Director of Strategy, WATGBenjamin J. “Patrick” Denihan, Chief Executive Officer,
Denihan Hospitality GroupBrian Ferguson, Vice President, Supply Strategy and Analysis,
Expedia North AmericaChuck Floyd, Chief Operating Officer–North America,
HyattGregg Gilman, Partner, Co-Chair, Employment Practices,
Davis & Gilbert LLP
Tim Gordon, Senior Vice President, Hotels, priceline.comSusan Helstab, EVP Corporate Marketing,
Four Seasons Hotels and ResortsJeffrey A. Horwitz, Chair, Lodging + Gaming, and Co-Head,
Mergers + Acquisitions, ProskauerKevin J. Jacobs, Senior Vice President, Corporate Strategy &
Treasurer, Hilton WorldwideKenneth Kahn, President/Owner, LRP PublicationsKirk Kinsell, President of Europe, Middle East, and Africa,
InterContinental Hotels GroupRadhika Kulkarni, Ph.D., VP of Advanced Analytics R&D,
SAS InstituteGerald Lawless, Executive Chairman, Jumeirah GroupMark V. Lomanno, CEO, Smith Travel ResearchBetsy MacDonald, Managing Director, HVS Global Hospitality
ServicesDavid Meltzer, Senior Vice President, Global Business
Development, Sabre Hospitality SolutionsWilliam F. Minnock III, Senior Vice President, Global
Operations Deployment and Program Management, Marriott International, Inc.
Mike Montanari, VP, Strategic Accounts, Sales - Sales Management, Schneider Electric North America
Shane O’Flaherty, President and CEO, Forbes Travel GuideThomas Parham, Senior Vice President and General Manager,
Philips Hospitality AmericasChris Proulx, CEO, eCornell & Executive EducationCarolyn D. Richmond, Partner, Hospitality Practice, Fox
Rothschild LLPSteve Russell, Chief People Officer, Senior VP, Human
Resources, McDonald’s USAMichele Sarkisian, Senior Vice President, MaritzJanice L. Schnabel, Managing Director and Gaming Practice
Leader, Marsh’s Hospitality and Gaming PracticeTrip Schneck, President and Co-Founder, TIG Global LLCAdam Weissenberg, Vice Chairman, and U.S. Tourism,
Hospitality & Leisure Leader, Deloitte & Touche USA LLP
Thank you to our generous Corporate Members
FriendsAmerican Tescor, LLC • Argyle Executive Forum • Berkshire Healthcare • Center for Advanced Retail Technology • Cody Kramer Imports • Cruise Industry News • DK Shifflet & Associates • ehotelier.com • EyeforTravel • 4Hoteliers.com • Gerencia de Hoteles & Restaurantes • Global Hospitality Resources • Hospitality Financial and Technological Professionals • hospitalityInside.com • hospitalitynet.org • Hospitality Technology Magazine • Hotel Asia Pacific • Hotel China • HotelExecutive.com • Hotel Interactive • Hotel Resource • International CHRIE • International Hotel Conference • International Society of Hospitality Consultants • iPerceptions • JDA Software Group, Inc. • J.D. Power and Associates • The Lodging Conference • Lodging Hospitality • Lodging Magazine • LRA Worldwide, Inc. • Milestone Internet Marketing • MindFolio • Mindshare Technologies • PhoCusWright Inc. • PKF Hospitality Research • Resort and Recreation Magazine • The Resort Trades • RestaurantEdge.com • Shibata Publishing Co. • Synovate • The TravelCom Network • Travel + Hospitality Group • UniFocus • USA Today • WageWatch, Inc. • The Wall Street Journal • WIWIH.COM • Wyndham Green
PartnersDavis & Gilbert LLP Deloitte & Touche USA LLPDenihan Hospitality GroupeCornell & Executive EducationExpedia, Inc. Forbes Travel GuideFour Seasons Hotels and Resorts Fox Rothschild LLP French Quarter Holdings, Inc. HVS Hyatt InterContinental Hotels Group Jumeirah GroupLRP PublicationsMarriott International, Inc.Marsh’s Hospitality Practice Maritzpriceline.comPricewaterhouseCoopersProskauer Sabre Hospitality Solutions Schneider Electric Thayer Lodging Group Thompson HotelsTravelportWATG
Senior PartnersASAE FoundationHilton WorldwideMcDonald’s USAPhilips HospitalitySASSTRTaj Hotels Resorts and PalacesTIG Global
4 TheCenterforHospitalityResearch•CornellUniversity
AbouT The AuThor
Ideas and Principles for the Hospitality Industry
Cathy A. enz, Ph.D., is a professor of strategy and the Louis G. Schaeneman, Jr. Professor of Innovation and Dynamic Management at the Cornell University School of Hotel Administration ([email protected]). She chaired the 2011 Service Innovation Roundtable described in these proceedings. Her research focuses on hospitality strategy, including innovation, competitive dynamics, pricing strategy, and change management. Among her recent publications are the best-practices series of case studies on innovators in the hospitality industry, with four coauthors, articles in the Cornell Hospitality Quarterly, and two new books The Cornell School of Hotel Administration Handbook of Applied Hospitality Strategy and Hospitality Strategic Management: Concepts and Cases, 2nd edition. The assistance of the following Cornell faculty members in preparing this report is appreciated: Professor Gary Thompson, Professor Rohit Verma, executive director of the Center for Hospitality Research, and Associate Professor Kate Walsh, Fred G. Peelen Professor of Hospitality Global Strategy.
ImprovingtheGuestExperiencethroughServiceInnovation:
byCathyA.Enz
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 5
exeCuTive SuMMAry
The 2011 Service Innovation Roundtable examined both the mechanisms for serviceinnovationandtheinnovationsthemselves.Theprimaryfocusoftheseinnovationswasimproving the guest experience, which includes interaction with employees andaddressing technical issues. Numerous lodging and hospitality firms are focusing
intentionallyoninnovationasawaytoimproveguestsatisfactionand,asaresult,boostrevenuesandprofits.Whiletheactualmeasurementofserviceinnovationscanbedifficult,mostparticipantspointedtosuchmetricsasimprovedcustomersatisfaction,greaterparticipationinloyaltyprograms,andcostsavingsfrommoreefficiencyintheguestserviceprocess,sinceguestsusuallyappreciateservicethatisasdirectandsimpleaspossible.ApresentationbyMarriottInternational,forinstance,explainedhowtheideaofimprovingtheguestarrivalexperienceinthelobbyledtothedevelopmentofthe“greatroom”concept,whichincludesadditional(andmorespeedy)foodandbeverageservice.InnovationatWyndhamincludesitsmanysustainabilityinitiatives.Throughoutanyinnovation,changeagentswillconfrontdifferenttypesofsupportandresistance,andmusthaveastrategyforaddressingtheconcernsofeachperson.Intheend,innovationmustbeasdata-drivenaspossible,whetherthatmeansaskingguests and employees for innovative ideas or finding ways to measure service changes as they areinitiated.
6 TheCenterforHospitalityResearch•CornellUniversity
Cornell hoSpiTAliTy roundTAble proCeedingS
Innovation is theprocessofdevelopingnewideasorprocesses,or takingexisting ideasandprocessesinnewdirections.Aninnovativeideaorprocessdoesnothavetoinvolveaboltfromtheblue,butitalmostalwaysinvolvesatleastatwistoncurrentoperations.MeetingatCornell’sSchoolofHotelInnovation,agroupoftwodozenserviceresearchersandpractitionersgathered
inMay2011 toexamine the latest concepts in service,withagoalof sharing innovative ideasandprocesses,andexpandingacultureofinnovationinthehospitalityindustry.
ImprovingtheGuestExperiencethroughServiceInnovation:
byCathyA.Enz
Ideas and Principles for the Hospitality Industry
Service innovation is the introduction of new or novelideas that focus on services that provide new waysof delivering a benefit, new service concepts, or newservice business models through continuous operationalimprovement, technology, investment in employeeperformance, or management of the customer experience.
—Developed during the 2008 Service Innovation RoundtableCornell University School of Hotel Administration
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 7
Theserviceinnovationroundtablebeganbyusingthedefinitionofserviceinnovation(notedabove)developedduringthefirstroundtablein2008.Withthisdefinitionasastartingpoint,roundtableparticipantslistedareaswheretheyhaveseenserviceinnovationsinthepasttwoyears.BarbaraTalbott,founderandCEO,GlenLarkinAdvisors,focusedonthevalueofensuringhighqualitycustomerser-vice.Shehighlightedtheprinciplethatamajorityofguestsarewillingtopayforupgradedservice,suchaswhenairlinessellaccesstoelitestatus.AsanexampleshepointedtotheAmericanAirlinesVIPClub,whichprovidestheserviceofintegratingtheelementsofgettingtoandthroughtheairportwithVIPstatus.
K.S.Srinivasan,vicepresident,humanresourcesandlearninganddevelopment,TajHotels,Resorts,andPalaces,sharedhiscompany’sfocusonenhancingtheguestexperi-enceinitsheritageproperties.TajhassetagoalofrecreatingthehistoricpalaceexperienceforthesepropertieswhichTajmanages.Startingwiththegreetingattheairport,thisgoalisreflectedinvintagecars,staffdress,andpalaceoperations,includingcuisineandcutlery.
ForWyndhamWorldwide,vicepresidentFaithTaylorexplainedthepushtowardagreenculture,involvingeduca-tion,training,recognition,andfun.Thetrainingprocess,forinstance,involvesinteractivetrainingmodulesthatestablishacommonlanguageforsustainability.Shesaidthatembed-dingagreenculturehasalteredenergyuse,amongothermeasures.SheexpandedontheWyndhamGreenprograminalaterpresentation,asdiscussedbelow.
SeanO’Kane,globalcommercialdirector,SchneiderElectric,pickeduponthethemeofenergyinnovation.Hepointedtothelackofunderstandingofwhatenergyreduc-tionisandisnot.HeagreedwithTaylor’sassertionregard-ingtheimportanceofeducation,particularlyregardingtheimportanceofautomatedsystems,whichcansave30to50percentofenergyuse.Schneiderisalsooffering“MyEnergyUniversity,”whichcomprises50onlinecoursestohelppeo-pleunderstandenergyissuesinacompany-andproduct-neutralway.O’Kane’squestionforthehospitalityindustry:Whenwillseriousenergyreductioneffortsbemade?
JayColdren,seniordirector,creativeprojects,MarriottInternational,discussedhisfirm’sglobalserviceinitiative,whichemphasizesanenvironmentwhereservicecanflour-ish,encouraging“serviceangels,”ashecalledthem.Onekeyinsighthereisthatinnovationrequiresinnovators,andonewaytoencourageinnovatorsandserviceangelsistocreatetheproperenvironment,includinginfrastructure,enablers,andculture.OtherparticipantsfromMarriottexpandedonthefirm’sinnovationdriveinalaterpresentation.
Webanalyticsareasourceofcreativeideas,accordingtoKellyMcGuire,executivedirector,globalhospitalityandtravelpractice,SAS.McGuirepointedtotechnologyasa
criticalsupportforinnovationefforts,includingdata-drivenideas,andseveralotherroundtableparticipantsagreedwiththatassertion.
MarkCarrier,seniorvicepresidentofB.F.SaulCompa-ny,whochairstheownersgroupforInterContinentalHotelsGroup,focusedonIHG’scultureoffranchiseoperationsinwhichparticipantsareworkingtodevelopacommoncultureacrossfranchiseesofcelebratingservice.Hepointstoasignalaccomplishmentofinvolving3,000hotelstopar-ticipateintheserviceinitiatives.Hisownfirm’sinnovationeffortsincludere-evaluatingdailyoperationsateverylevel,undertherubric:“Beremarkable—thinkbig.”ThissloganbothsymbolizesandreinforcesB.F.Saul’sinnovationefforts.
ForMorrisSim,CEOandco-founderofCircosBrandKarma,web-baseddatashouldbeanalyzedfromthereader’spointofview,anapproachthatisthereverseoftheusualwriter-focusedapproach.Sim’sgoalinthis“archeological”approachistoconverttheweb’sdiffuseinformationintoleadingindicatorsofconsumertrends.AsdescribedinaCHRReportoninnovativefirms,BrandKarmaseekstomakeforwardlookingdataavailable. 1AsSimputsit,every
1See:JudySiguaw,CathyA.Enz,SherylE.Kimes,RohitVerma,andKateWalsh,“CasesinInnovativePracticesinHospitalityandRelatedSer-vices:Set1,”Cornell Hospitality Reports,Vol.9No.17(2009),pp.11–13;CornellCenterforHospitalityResearch.
Many innovations focused directly on improving the guest
experience.
8 TheCenterforHospitalityResearch•CornellUniversity
thatmodelscustomers’actions(asdescribedlaterinmoredetail).
ThepresidentofCoyleHospitalityGroup,JimCoyle,isfocusedonhowtouseresourcestobringservicestocustom-ersatthelowestpossiblecost.Hisfirm’sgrowthhascalledforanewbusinessmodel,ashisfirmhasdoubledinsizeinthepastyear.Hisgoalistotrain6,000people.Hebelievesthatifyoulistentoyourcustomers,theywillsignalneededinnovations.
NeilKataria,chairmanandCEOofNewBrandAnalyt-ics,addresseddataminingofsocialmediaandotherwebpages.GiventhatTwitterhassome200millionhitsperday,it’simportantforeachcompanytodeterminewheresocialmediafitintotheirbusiness.Sinceonesizedoesnotfitall,eachfirmhastodevelopitsownstrategyforsocialmedia.
AlthoughlodgingindustryleadersagreedthattheconceptforTripTVisagoodone,presidentandCEOKulinStrimbupointedoutthechallengeofpromotinganinnova-tivestart-upthatinvolvesgettingthebuy-inofcustomerswithdiverseandoverlappingbudgetconstraints.Additionalchallengesinvolvehelpingthecustomermovingbeyondanarrowviewofvideoplayproductionanddevelopingavi-ablerevenuemodelforanewventure.Asoneexample,Star-wood’sHawaiipropertiesareinvolvedinTripTVproduction.2
JumeirahisextendingitsinnovativeArtist-in-Residenceprogram,whichhasbroughtartintopublicspaces,ratherthanconfiningartinmuseumsorprivatehomes.Thekeyis-sueishowtointegratetheartsandcultureofhotellocations,saidKatherineGass,curatorattheJumeirahEssexHouseinNewYork.3Travelersareinterestedinthelocationsthattheyvisit,withartandculturebeingasubstantialpieceofthattouristinterest.Hotelsareapartofthecommunitywheretheyarelocated,anditmakessenseforahoteltosupporttheartandcultureofitscommunity.Whilethereisnowaytomeasuretheeffectsofthisprogram,it’sclearthatguestsandlocalresidentsappreciateit.
Fairmonthasbeenreengineeringitsguestservicespro-cessestofocusmoredirectlyonguestpreferences,accordingtoAndreaTorrance,vicepresident,rooms,FairmontHotelsandResorts.Thisisnotrevolutionary,shepointsout.Insteadtheyhavereinventedandputinplacewhattheycall“serviceessentials,”whichremovesredtapeandgivesemployeesthepowertoactasneeded,especiallygiventhatdifferenttypes
2See:CathyA.Enz,RohitVerma,KateWalsh,SherylE.Kimes,andJudySiguaw,“CasesinInnovativePracticesinHospitalityandRelatedServices:Set3,”Cornell Hospitality Reports,Vol.10,No.10(2010),pp.23–24;Cor-nellCenterforHospitalityResearch.
3See:CathyA.Enz,RohitVerma,KateWalsh,SherylE.Kimes,andJudySiguaw,“CasesinInnovativePracticesinHospitalityandRelatedServices:Set3,”Cornell Hospitality Reports, Vol.10,No.10(2010),pp.13–15;CornellCenterforHospitalityResearch.
dayisan“electionday,”whencustomersdecidewhatbrandtheywillpatronize.
ThecaseofaLasVegashotelofferedlessonsininnova-tion,asrelatedbyMikeBenore,director,DeloitteConsult-ing.Thegameplanwastousetechnologytofocusontheguestexperiencetodifferentiatethe3,000-roomhotelfromitscompetitors.Thehotelusedanalyticstounderstandguestpreferencesandtailoroffers.Thenituseddatawarehous-ingtodevelopadatabaseofthoseguestpreferencesthatcouldoperatenearlyinrealtime,alongwithananalytical
“map”ofguestinformation.Theideaistoprovideadifferentplatformfortheguestroomexperience,includingtelevi-sionsforguestinteraction.Alsoinvisualformisthe“map,”whichgivesstaffadepictionofguestpreferences.AlthoughBenoreconcludedthatthisisanexcellentoverallstrategy,hesuggeststhatahotelnotattempttodoallthesethingsatonce,duetotheintensityandexpenseofthetechnologyandtraininginvolved.
StacyOliver,learningconsultant,FourSeasonsHotelsandResorts,alsodiscussedinnovationtoimprovetheguestexperience,withaparticularfocusonemployeeempow-erment,sincetheemployeesknowtheguestwell.This
“disciplineofinnovation”createsaframeworkandprocesstoenableemployees’innovationinawaythatimprovesprofit.
ForSouthwestAirlines,currentinnovationcentersonintegratingterabytesofcustomerloyaltyprogramdata,accordingtoleadresearcherDougLawson.Thischalleng-ingprocesswouldresultinaforecastofthewishesandactionsofsome340,000customerseachday.Onewaytoaddressthisimmenseanalyticalissueistocreateasurrogate
Successful innovation is data-driven and also requires considerable tenacity.
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 9
oftravelershavedifferentneeds.Itisnotuncommonforserviceinnovationtobeevolutionarygiventhatitisoftenincrementalandprocessenhancingratherthanradicalanddisruptive.
ConfrontingtheMatrixCeciliaLewis,vicepresidentofMarriottInternational,joinedMatthewvonErtfelda,vicepresident,creativestrategy,insight,strategyandinnovationteam,toofferade-tailedexplanationofthecompany’sinnovationandserviceinitiative.ReflectingJayColdren’scommentthatinnovationrequiresinnovators,vonErtfeldasuggestedmechanismstodevelopinnovators,includinganonlineplatform,“didyou-thinkofthis.com.”Thiswebsitefocusesassociatesoncollabo-rationforinnovation.Theinnovationtoolsincludeguest-facingwebsites,emphasizingtheimportanceofbringingguestsintotheprocessearlyonandhelpingassociatesfocusonthequestionofhowtheguestcanbebestserved.
LewisaddedthatMarriottwantedtomoveinnovationfaster,butthefirm’smatrixof19brandsandfourregionalofficesrequiredfocusandalignment.Processinnovationhelpedprovidethatfocus.Asanexample,Marriottwantedtore-inventitslobbyspacetoprovideabetteroverallguestexperience.Thetimefromideatoimplementationwouldtypicallybethreeyears,butthefocusedprocessinnovationcutthattimeto18months.Onequestionthatsheposestothelodgingindustryasawholeishowtobreakthroughtotakeadvantageoftheindustry’sinnovativeefforts.
Tobesure,innovationisamessyprocess,Lewispointedout,andthequestionishowtoharnessthatenergyandmakeitwork.Althoughthecompanycouldseemanyareasforinnovation,theyfocusedontheguest,beginningbyde-constructingtheguestexperience.Thisdrewtheirattentiontothepublicspace.Asaresult,thelobbyreinventionwasin-tendedtoimprovetheatmosphereandenvironmentandtomakethespacelooklesslikeatransitpoint.Bringingguestsintotheprocessprovedtobeacriticalsourceofideas,andthefirm’sconsultantsalsobenchmarkedcompetitors’spaces.
Theresultwastheconceptofagreatroomthatwasdesignedaroundtheneedsofguestsandassociates.Thenewconceptwentbeyondseatingtoincludemusicandaddi-tionalfoodservice,alongwithadditionaltraininginthenewlobbyactivationinitiative.Theoverallgoalwastocreateabetterserviceenvironmentandtodeliverhighervaluetothecustomer.
Theprocessbeganwithsynthesisofinformationandthenwenttoideation,followedbytestingtheideas.Tomovetheprocessalongitwasessentialtooverrideorevensuspendthenegativeorblockingcommentsofstakehold-erstoallowanalysisofwhatactuallyishappening.Lewissummarizedtheprocessasonedrivenbyplanning,startingwithresearchtogetcustomerinsights;conceptdevelopment
andtesting;andthenbuildingouttheresultingstructures.“Timeisoftheessence,”Lewisconcluded.“Ifyou’regoingtofail,thenfailfast.”
Data-drivenInnovationMarkLomanno,presidentofSTR,andDougLawson,leadresearcher,SouthwestAirlines,offeredtwoperspectivesonapplyingdatatoinnovation.Lomannofocusedonthecontinuingrelationshipofthelodgingindustrytoonlinetravelagencies(OTAs).STRhasdevelopeddataonthecostsofusingOTAs,forinstance,butdatadonotsupportthewaychainsareusingOTAs.OneissuehereisthathotelsdonotknowthetruecustomercostwhenguestsbuythroughOTAs.Theuseofsocialmediaallowsdatamining,especiallysincecustomersgenerallywon’tfilloutsurveys.However,datafromsocialmediamustbeinterpretedandlinkedtothedecisionmakers.Theinterpretationprocessincludesfilteringtheideasaccordingtoqualityofdata,particularlyaggregateddata.
LawsonexplainedSouthwestAirlines’researchoncustomerbehavioratthecheck-inandatthegate.Usingcomputersimulations,theairlinehasexaminedsuchissuesashowlongittakestocheckinandgettothegate,andhowarrivalgateassignmentsaffecttheprocess.StampingthedateonserviceexchangeshasallowedSouthwesttodevelopuniquebehavioralmodels.
SustainabilityinServiceExcellenceUndertheslogan“OneGoal.OneTeam.OneEarth”WyndhamWorldwidehasworkedtoinstillits“WyndhamGreen”sustainabilityprogramchain-wide,accordingto
Innovators must be ready to address objections and use
different forms of leadership at different points in the
innovation process.
10 TheCenterforHospitalityResearch•CornellUniversity
fordripirrigationtoreducewaterconsumptionandtofilterthewaterasitreturnstotheaquifer.SitesustainabilityisalsopartoftheLEEDprogramthoughtheU.S.GreenBuildingCouncil.Morethan300Wyndhamsitesworldwidepartici-pateinbuildingcertificationprograms.
SurveyingInnovativeIdeasandIssuesTheserviceinnovationworkshopwasframedbyanin-novationsurveywhichparticipantsfilledoutbeforesittingdownfortheirdiscussions.Inthefirstquestion,theywereaskedtodistinguishserviceinnovationfromothertypesofinnovation.Theoverridingconcernunderlyingservicein-novationwasthecustomer—improvingtheguestexperience,ratherthanfocusingon,say,operationalefficiency.Indeed,oneparticipantwarnedthatserviceinnovationneedstobedrivenbytheemotionalexperienceofferedbyguestsand,further,thatfocusingonefficiencyorproductivitymaycauseanyinnovationstomisstheirtargetoftheguestexperience.Beyondthisfactor,theparticipantsofferedthefollowinginsightsaboutserviceinnovation:• Innovationsinservicemostlyhappeninanorganic
way,ratherthanfollowingasetprocessorapre-definedapproach.
• Successinserviceinnovationrequiresanintegrated,multi-facetedapproach.
• Serviceinnovationrequiresaculturethatsystematicallyenablesemployeestodelightfullysurprisecustomers.
• Serviceinnovationisdifficulttoinnovatebecauseitdependssoheavilyonpeoplefordelivery.
RecentServiceInnovationsTherecentserviceinnovationscitedbypanelmemberslikewisetargetwaystoimprovetheguestexperience.Thisincludedexpresslydevelopingwaystoimprovecommunication,boostefficiency,andmakethearrivalprocessmoreappropriate.Indeed,severalcompanieswerefocusingonimprovinginteractionsatthefrontdesk.Thisincludesawarmwelcome,quicklyaddressinganyproblems,andcontinuingwithongoingrecognition.Inadditiontocompany-specificinnovations,participantsmentionedthefollowinginitiatives:• Applyinghospitalityanalyticsthattargetguestsbased
ontheirspendingandamenityuseprofiles.
• Encouragingassociates’behavioralchangethroughrecognitionprograms.
• Improvingtheinteractionbetweenguestsandassoci-atessothatguestscanmoreeasilyexpresstheirneeds.
FaithTaylor,vicepresidentsustainabilityandinnovation,WyndhamWorldwide.TaylorandCHRExecutiveDirectorRohitVermausedtheWyndhamexperienceasoneexampleofcompaniesthathaveconnectedsustainabilitywithserviceinnovation.Theypointedoutthatsustainabilityisaglobalmegatrendforthiscentury,similartoqualityassuranceinthe1980sandtechnologyinthe1990s.
TaylorandVermaoutlinedsomeofthehotelbestprac-ticesthatWyndhamhasinitiatedaspartofitsWyndhamGreenprogram.Forinstance,theSuper8inMonroe,Wis-consin,mettherequirementsforthestate’s“TravelGreen”distinction.OnewaythatWyndhamencouragesitsassoci-atestomaintainsustainablepracticesiswithunexpectedrecognitionthroughits“caughtgreenhanded”program.Whenanotheremployeenoticesoneoftheirpeersrecyclingorfollowinganothergreenpractice,theycanbecitedfor
“goinggreen.”TheWyndhamGreenprogramalsoincludesasmuch
useoftechnologyaspossibletoreplacepaperthroughouttheguest-stayprocess,forexamplewithacknowledgmentsandfolios.AirprocessingtechnologyallowedWyndhamtooffer“clearair”roomsinbothguestroomsandfunctionspacesinitsWyndhamHotelsandResortschain.Likewise,Wyndhamworkswithitssuppliersformaximumsustain-ability.Themostremarkableexampleofthiswasitsassocia-tionwithCintastocreateanewsetofuniformstailoredfromfabricmadeofrecycledbeveragecontainers,Taylorsaid.
Sitesustainabilityisalsoincludedinthisprogram,no-tablywithaeratedwastewatertreatmentthatusesultravioletlighttoremovebacteriaandby-productstypicalofsewage.Thetreatedwateriseffectivelygraywaterthatcanbeused
Several companies maintained a separate department or office responsible for promoting innovation. Other companies instilled innovation throughout the organization.
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 11
SkunkWorks?PickingupontheideainitiatedduringWorldWarIIbyLockheedMartinthatcompaniesneeda“skunkworks”ofinnovatorstocreateideas,thesurveyaskedwhetherpartici-patingcompanieshaveaseparatedepartmenttopromotein-novation.4Theresponsewasdivided,withsomecompaniesstatingthatinnovationisendemicintheircorporateculture,whileothershadaseparatedepartmentchargedwithdevel-opingquestionsandanswers.Onerespondentpointedoutthatnewemployeesoftenbringvaluableideaswiththem.
Todevelopandcaptureinnovativeideasfromtheiras-sociates,somecompanieshaveanofficialwebportal,othersconvenebrainstormingmeetings,andsomespecificallysetideagenerationasanemployeegoal.Similarly,thecompa-niesweredividedontheextenttowhichtheyrewardassoci-atesforproposinginnovations.Whilesomeoffernospecificrewards,othersgoalloutwithbothintangiblerewardsandtangiblerewards,suchasgiftcertificatesormonetaryawards.
Measuringtheeffortputintoinnovationisarealchal-lengeforallfirms.Mostdonothaveawaytomeasurein-novation,whilesomeassessaflat“innovationtax”ormakemeasurementsepisodically.
InnovationsBeyondServiceAlthoughtheroundtablefocusedonserviceinnovation,thequestionnairegaveparticipantstheopportunitytosharecompanyinnovationsbeyondserviceandoperations.Manyoftheproductrelatedinnovationsinvolvedoftheuseofin-formationtechnology.Examplesincludethefollowing:Useofsocialmedia,addingtelepresence,newgreenuniforms,updatingdatabaseplatforms;creatinganinteractivewebbasedplatform,andenhancingthewebsite.
Processinnovationsinvolveimprovingworkflow,infor-mationflow,ordeliverymethods.Newprocessesmentionedbytheparticipantsincludedsuchinitiativesasthefollowing:• Buildingawebsitetoconnectproductionpartnerswith
thecontentlibraryforeasyupload,categorization,anddeliverytocustomers;
• Morelobbyself-serviceandahailingsystem;
• Notificationandworkflowfeaturessothattheanalysiscanbebetterincorporatedoperationally;
• Industryprocessmodelsforgamingandhospitality;
• Receivingpaystubselectronicallyratherthanonpaper(inthemail);
• Turningtheentireworkforceintoahelpdesk;and
• Distancelearning.
4See:“SkunkWorks:TheOriginStory,”www.lockheedmartin.com/aero-nautics/skunkworks/.SkunkWorksisatrademarkofLockheedMartin.
Marketinginnovations,whichincludeimprovementsinproductdesignorpackaging,promotion,orpricing,spannedawiderange:• Alternativemarketingchannelsforvideodistribution;• Bettermatchingofrewardmileswithrevenuemiles;
• DestinationrestaurantF&Bmarketing;
• Frameworksandtrainingmodulestohelpsalesandmarketingbetterprotectbrandreputation,aswellasdriveconversion;
• UsingonlineiPadandiPhoneappstodelivermarketingmessages;
• Improvedtradeshowattendanceandmaximizingop-portunitiestomeetface-to-face;and
• Newageadvertisingmethodologytoconveythebrandpromisedeliverythroughproductandserviceofferings.
SimulatingChangeTheroundtable’sfinalsessionfocusedonmechanismsforandroadblockstointroducinginnovations,bydiscussinglessonsfromthehospitalitychangesimulationdesignedbyroundtableorganizerCathyEnz(availablethrougheCornell).5Participantsplayedtheroleofchangespecialistsinthisinteractiveonlinesimulation,withthegoalofgettingthemanagementlevelpersonnelofasimulatedhoteltoadoptachange,whiletakingintoconsiderationtheparticu-larcultureandresistanceofhotelpersonnel.
Thepurposeoftheexperiencewas:
5www.eCornell.com.
Technology is a large factor in most companies’ service
innovation efforts.
12 TheCenterforHospitalityResearch•CornellUniversity
• Changeispolitical,and
• Changeispersonal.
Participantswereexposedtodifferenttypesofresistorsinthesimulationanddiscoveredhowtousedifferentstrate-giesdependingonwhoandwheretheywereinthechangeprocess.Thediscussioncenteredaroundthechallengesinintroducingchangeandhowthelearningprinciplesofthesimulationweresimilartothoselearnedwhentryingtointroducechange.
Threelessonsregardingchangearethefollowing:1. Gettingachangeadopted,evenwhenithasobvious
advantages,isdifficult.
2. Itisimportanttoknowsomethingaboutthepeopleyouwishtochangeandtounderstandtheirsocialnetwork.
3. Opinionleadersandgatekeeperarecriticaltoimple-mentingchange.
Andherearethreeguidingprinciplesregardingchange:1. Changehappensinstages.
2. Differentstrategiesaremoreeffectiveindifferentstages.
3. Peoplemovethroughstagesatvaryingspeeds.
Finally,participantsrecognizedthefollowingfive“adoptertypes,”eachofwhomrequiresadifferentstrategyforsuccessfulinnovation:• Innovator,quicktotrynewideas,butnotarecognized
leader;
• EarlyAdopter,arecognizedleaderwhoisrelativelyearlyonnewideas;
• EarlyMajority,deliberateinadoptinginnovationsafterseeingtheminaction;
• LateMajority,hesitanttoadoptinnovations,butnotcontraryminded;and
• Resister,notinterestedininnovations,butalsonotaleader.
ComparingNotesRoundtableparticipantsfounditvaluabletocomparenotesoninnovationprocessesandalsosimplytohearwhatin-novationsothersaremaking,evenacrossdifferentsegmentsoftheindustry.Perhapsthegreatestkeytoinnovationisnottogiveup,buttoremainpatientandtenaciousinattemptingtomovepeopletowardthegoal.Avarietyofstrategiesmaybecalledforalongtheway,andevaluationandfeedbackarekey.n
• Toexploretheforcesdrivingchangeandthereasonswhypeopleresist;
• Toidentifyanddiscusswhatpracticesneedtobechangedandwhy;
• Toexperiencetheroleofintroducingaspecificchangeintoahotel;and
• Todevelopasoundchangeadoptionstrategyasateamandexperimentwithdeployingandrevisingastrategybasedonstepbystepfeedbackaboutwhatdrivesorimpedeschange.
Indiscussingtheirexperiencesduringthesimulation,severalparticipantsbecamesoengrossedthattheyplayedthesimulationforseveralhours,astheyaddressedthechallengesofgettingtheinnovationadopted.Thefrustra-tionsandcomplexityofintroducingchangewerefelttoberealisticinthissimulationandthisprovidedacontextforparticipantsmentioningsomeoftheirownchallenges.Oneofthekeylearningoutcomeswasthatdifferentstrategiesforintroducingchangeworkmoreeffectivelyatdifferenttimesintheinnovationprocessandwithdifferenttypesofpeople.
Studiesofchangesuggestthefollowingkeypoints:• Changeismessy,
• Changeiscomplicated,
• Changeinvolvesconflictingdemands,
• Changerarelyturnsoutrightthefirsttime,
• Therealityofchangedefiesfad,
A change management simulation exercise provided perspectives on real-world innovation issues.
The Executive Path Hospitality Leadership Through Learning
Complete program information and applications available online:
www.hotelschool.cornell.edu/execedPhone + 1 607 255 4919 Email [email protected]
Professionals from around the world are invited to attend 3-day, 10-day or online courses at the world’s leading institute for hospitality management education in:
Visit our website to apply.
Explore, develop and apply ideas with global hospitality leaders and
expert Cornell professors.
Success
AdvancingBusiness
andPersonal
• Strategic Leadership• Finance• Foodservice• Human Resources
• Marketing• Operations• Real Estate
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 13
The Executive Path Hospitality Leadership Through Learning
Complete program information and applications available online:
www.hotelschool.cornell.edu/execedPhone + 1 607 255 4919 Email [email protected]
Professionals from around the world are invited to attend 3-day, 10-day or online courses at the world’s leading institute for hospitality management education in:
Visit our website to apply.
Explore, develop and apply ideas with global hospitality leaders and
expert Cornell professors.
Success
AdvancingBusiness
andPersonal
• Strategic Leadership• Finance• Foodservice• Human Resources
• Marketing• Operations• Real Estate
14 TheCenterforHospitalityResearch•CornellUniversity
CHR Publications
Indexwww.chr.cornell.eduCornell Hospitality Quarterlyhttp://cqx.sagepub.com/
2011 ReportsVol.11,No.11CustomerLoyalty:ANewLookattheBenefitsofImprovingSegmentationEffortswithRewardsPrograms,byClayVoorhees,Ph.D.,MichaelMcCall,Ph.D.,andRogerCalantone,Ph.D.
Vol.11,No.10CustomerPerceptionsofElectronicFoodOrdering,bySherylE.Kimes,Ph.D.
Vol.11,No.92011TravelIndustryBenchmarking:StatusofSeniorDestinationandLodgingMarketingExecutives,byRohitVerma,Ph.D.,andKenMcGill
Vol11No8Search,OTAs,andOnlineBooking:AnExpandedAnalysisoftheBillboardEffect,byChrisAndersonPh.D.
Vol.11No.7Online,Mobile,andTextFoodOrderingintheU.S.RestaurantIndustry,bySherylE.Kimes,Ph.D.,andPhilippF.Laqué
Vol.11No.6HotelGuests’ReactionstoGuestRoomSustainabilityInitiatives,byAlexSusskind,Ph.D.andRohitVerma,Ph.D.
Vol.11,No.5TheImpactofTerrorismandEconomicShocksonU.S.Hotels,byCathyA.Enz,RenátaKosová,andMarkLomannoVol.11No.4ImplementingHumanResourceInnovations:ThreeSuccessStoriesfromtheServiceIndustry,byJustinSunandKateWalsh,Ph.D.
Vol.11No.3Compendium2011
Vol.11No.2PositioningaPlace:DevelopingaCompellingDestinationBrand,byRobertJ.Kwortnik,Ph.D.,andEthanHawkes,M.B.A.
Vol.11No.1TheImpactofHealthInsuranceonEmployeeJobAnxiety,WithdrawalBehaviors,andTaskPerformance,bySeanWay,Ph.D.,BillCarroll,Ph.D.,AlexSusskind,Ph.D.,andJoeC.Y.Leng
2011 Hospitality ToolsVol.2No.1MegaTips2:TwentyTestedTechniquesforIncreasingYourTips,byMichaelLynn
2011 ProceedingsVol3,No.6HospitalityBrandManagementRoundtable:FreshThinkingabouttheBox,byChekitanS.DevandGlennWithiam
Vol3,No.5BuildingBrandsintheInternetAge:Analytics,Loyalty,andCommunication,byGlennWithiam
Vol.3,No.4BraveNewWorld:OnlineHotelDistribution,byGlennWithiam
Vol.3,No.3SocialMediaandtheHospitalityIndustry:HoldingtheTigerbytheTail,byGlennWithiam
Vol.3No.2TheChallengeofHotelandRestaurantSustainability:FindingProfitin“BeingGreen,”byGlennWithiam
Vol.3No.1CautiousOptimism:CHRSExaminesHospitalityIndustryTrends,byGlennWithiam
2010 ReportsVol.10No.18HowTravelersUseOnlineandSocialMediaChannelstoMakeHotel-choiceDecisions,byLauraMcCarthy,DebraStock,andRohitVerma,Ph.D.
Vol.10No.17PublicorPrivate?TheHospitalityInvestmentDecision,byQingzhongMa,Ph.D.andAthenaWeiZhang,Ph.D.
Vol.10No.16BestPracticesinSearchEngineMarketingandOptimization:TheCaseoftheSt.JamesHotel,byGregBodenlos,VictorBogert,DanGordon,CarterHearne,andChrisK.Anderson,Ph.D.
Vol.10No.15TheImpactofPrix Fixe MenuPriceFormatsonGuests’DealPerception,byShuoWangandMichaelLynn,Ph.D.
Vol.10No.14TheFutureofHotelRevenueManagement,bySherylKimes,Ph.D.
Vol.10No.13MakingtheMostofPriceline’sName-Your-Own-PriceChannel,byChrisAnderson,Ph.D.,andShijieRadiumYan
Vol.10,No.12CasesinInnovativePracticesinHospitalityandRelatedServices,Set4,byCathyA.Enz,Ph.D.,RohitVerma,Ph.D.,KateWalsh,Ph.D.SherylE.Kimes,Ph.D.,andJudyA.Siguaw,D.B.A
Vol.10,No.11Who’sNext?AnAnalysisofLodgingIndustryAcquisitions,byQingzhongMa,Ph.D.,andPengLiu,Ph.D.
CornellHospitalityRoundtableProceedings•June2011•www.chr.cornell.edu 15
Vol.10,No.10CasesinInnovativePracticesinHospitalityandRelatedServices,Set3:CayugaSustainableHospitality,Chic&Basic,JetBlueAirlinesJumeirahEssexHouse,TheRitz-CarltonHotelCompany,Runtriz,TheSeaportHotel,ThayerLodging,TripTelevision,andXsenseExperientialDesignConsulting,byCathyA.Enz,Ph.D.,RohitVerma,Ph.D.,KateWalsh,Ph.D.SherylE.Kimes,Ph.D.,andJudyA.Siguaw,D.B.A.
Vol.10,No.9BuildingCustomerLoyalty:TenPrinciplesforDesigninganEffectiveCustomerRewardProgram,byMichaelMcCall,Ph.D.,ClayVoorhees,Ph.D.,andRogerCalantone,Ph.D.
Vol.10,No.8DevelopingMeasuresforEnvironmentalSustainabilityinHotels:AnExploratoryStudy,byJieJ.Zhang,NitinJoglekar,Ph.D.,andRohitVerma,Ph.D.
Vol.10,No.7SuccessfulTacticsforSurvivinganEconomicDownturn:ResultsofanInternationalStudy,bySherylE.Kimes,Ph.D.
Vol.10,No.6IntegratingSelf-serviceKiosksinaCustomer-serviceSystem,byTsz-Wai(Iris)Lui,Ph.D.,andGabrielePiccoli,Ph.D.
Vol.10,No.5StrategicPricinginEuropeanHotels,2006–2009,byCathyA.Enz,Ph.D.,LindaCanina,Ph.D.,andMarkLomanno
Vol.10,No.4CasesinInnovativePracticesinHospitalityandRelatedServices,Set2:Brewerkz,ComfortDelgroTaxi,DinnerBroker.com,Iggy’s,JumboSeafood,OpenTable.com,PriceYourMeal.com,SakaeSushi,Shangri-LaSingapore,andStevensPass,bySherylE.Kimes,Ph.D.,CathyA.Enz,Ph.D.,JudyA.Siguaw,D.B.A.,RohitVerma,Ph.D.,andKateWalsh,Ph.D.
Vol.10,No.3CustomerPreferencesforRestaurantBrands,Cuisine,andFoodCourtConfigurationsinShoppingCenters,byWayneJ.TaylorandRohitVerma,Ph.D.
Vol.10,No.2HowHotelGuestsPerceivetheFairnessofDifferentialRoomPricing,byWayneJ.TaylorandSherylE.Kimes,Ph.D.
Vol.10,No.1Compendium2010
2010 Roundtable RetrospectivesVol.2,No.1SustainabilityRoundtable2009:TheHotelIndustrySeekstheElusive“GreenBullet.”
2010 Industry PerspectivesNo.6TheFutureofMeetings:TheCaseforFacetoFace,byChristineDuffyandMaryBethMcEuen
No.5MakingCustomerSatisfactionPay:ConnectingSurveyDatatoFinancialOutcomesintheHotelIndustrybyGinaPingitore,Ph.D.,DanSeldin,Ph.D.,andArianneWalker,Ph.D.
No.4HospitalityBusinessModelsConfronttheFutureofMeetings,byHowardLockandJamesMacaulay
2010 ToolsToolNo.13MeasuringthePerformanceofSearchEngineMarketing:TwoToolsfortheHospitalityIndustryAnilAggarwalandBillCarrollPh.D.
ToolNo.14TheWineCellarManagementTool2.0,GaryM.ThompsonPh.D.
2009 ReportsVol.9,No.18HospitalityManagersandCommunicationTechnologies:ChallengesandSolutions,byJudiBrownell,Ph.D.,andAmyNewman
Vol.9,No.17CasesinInnovativePracticesinHospitalityandRelatedServices,Set1:AquabyGrandstand,BrandKarma,CapellaHotels&Resorts,EnTrip,Hotels.comVisualiser,LuggageClub,RoyalPlazaonScotts,Tastings,TuneHotels,andVisitBritain.com,byJudyA.Siguaw,D.B.A.,CathyA.Enz,Ph.D.,SherylE.Kimes,Ph.D.,RohitVerma,Ph.D.,andKateWalsh,Ph.D
Vol9No16TheBillboardEffect:OnlineTravelAgentImpactonNon-OTAReservationVolume,byChrisK.Anderson,Ph.D.
Vol9No15OperationalHedgingandExchangeRateRisk:ACross-sectionalExaminationofCanada’sHotelIndustry,byCharlesChang,Ph.D.,andLiyaMa
Vol9No14ProductTiersandADRClusters:IntegratingTwoMethodsforDeterminingHotelCompetitiveSets,byJin-YoungKimandLindaCanina,Ph.D.
Vol9,No.13SafetyandSecurityinU.S.Hotels,byCathyA.Enz,Ph.D
CHR PublicationsIndex
www.chr.cornell .edu