Leadership Challenges in the Hospitality Industry

CEOs need to know… 

The business world is undoubtedly dynamic, and decision-making requires the highest degree of skills, knowledge, and attitude on the part of business leaders. The hospitality industry is fragmented, with fierce competition among hospitality establishments.

Hospitality leaders have the daunting task of operating the organizations in the backdrop of such high levels of uncertainties and global competition. Given the complex political, cultural, economic, and environmental dimensions, the traditional approaches to leadership in the hospitality industry are becoming less and less effective in engaging, empowering, and energizing its workforce. How prepared are you as a CEO?

As author, with this perspective in mind, I interviewed several incumbents and industry practitioners in deciphering the critical leadership challenges in the backdrop of globalization and exponential technological revolution. We have realised that the recent pandemic has led to a digital disruption marking a new era characterized by volatility, uncertainty, complexity, and ambiguity (VUCA).

Secondly, our discussions ramped around challenges that have pushed the industry capable of marching in a 4.0 mode. To the best of discussions, it has been felt that this may be endowed by factors such as knowledge, human capital, capacity to innovate, the speed of adaptation and response to market changes. Don’t you think this is a big challenge?

Our thought framework 

CEOs need to explore the social, economical, political challenges before the hospitality entrepreneurs. Apart from such challenges, these industry leaders shall bring forward the personal qualities that the hospitality leaders must possess in overcome the entrepreneurial challenges in VUCA times. 

Hence, what we need to explore?

We know that leadership is one of the highly researched topics and among the most deliberated area of discussion with management gurus. In context to leadership in the hospitality sector it is pertinent to explore:

1. How should leaders manage a delicate balance between profitability and concern for the environment and employees?
2. What sorts of leadership skills are most useful in this demanding sector?
3. How do leaders make decisions on critical issues?
4. What leadership skills are required during pandemic times, where the situation may be unexpected and unknown?

There are no fixed responses, as they are tailored to suit the personality of the leader, the business situation at site and the circumstances under which critical decisions are made. Yet the questions are similar, seeking a higher component of critical thinking.

Some assumptions and triggers

Intense discussions with the CEOs, leaders, and entrepreneurs, certain descriptors came in discussion such as agility, critical thinking, work-life-balance, automation, agility and many more. As author, I bounced back to the CEOs on these triggers. 

1. Agility: How can these leaders be ready for change? Is there a mechanism?
2. Critical thinking: Have leaders started thinking on what’s going around their industry?
3. Work-life-balance: How to maintain a balance between technology and humans?
4. Automation: To what degree technology must make life of employees and guests easier 
5. Agility: What degree of agility is present and required in responding to uncertainties?  

The new order

The pandemic has brought a revolution, resetting the button of business engagements. The hospitality industry is beyond hospitality, several other sectors are involved in offering services. There are new safety labels required for restaurants to assure customers on health and hygiene factors. There is a sea emphasis on behavioural response in this hospitality industry. The key leadership challenge is to “be human” and as a role model by being compassionate. We must not forget that people must look up to the leader. Involve people in discussions and look for opportunities continuously. Having said this is not easy, a challenge compelling the leader to rise above all in all occasions!

Empathy, empowerment and adaptability is in high demand. This service industry mandates a sea change in the Institutional framework. We should understand that crisis is an opportunity to bounce back with creative ideas. It pushes the limits to thinking and rising from ashes!

CEOs recommendations

Don’t be afraid of struggle, start accepting the situation that is dynamic in perspective. One must be ready to take risks and learn methods to maneuver. There is humility in learning from mistakes, the faster one learns from them the higher is the agility power to scale new heights. One must be engaged in constantly re-visiting the insights of the business, the industry and one’s own capabilities that may be detrimental to sustainability and existence. The display of resilience during these challenging circumstances is one critical asset a CEO must possess. It is time to re-think and change, change fast.

Written by Prof. (Dr.) Manoj Joshi.
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The World’s Richest People (Top Billionaires, 2023).
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