Outsourced housekeeping - the panacea to all our housekeeping woes?

Question

Outsourcing companies are tipped to be benefitting from the current arduous environment characterised by occupancy fluctuations and labour shortages. Yet the problems are no different for external parties and some of the economies of scale inherent in the hotel are delegated down the line. While the hotel is expecting to minimise costs substantially, the outsourcer is expected to achieve the same excellent result on a lower cost base.

Are outsourcing agencies truly better at managing the operation or are hoteliers just passing the buck because managing housekeeping is perceived as 'getting too hard'?

This viewpoint is co-created with Optii Solutions Inc.
More information

Silvia Kirkland Zese · Answer

I have personally worked with a couple of third parties in the past, one that managed only the hiring process and the payroll portion, and one that actually managed the operations - under my team's supervision. I don't think it's fair giving an opinion based only on two precedents, but I can share I remember my experience when outsourcing operations as a challenging one. There are certainly benefits from choosing to go this route: number one undoubtedly is the hiring and paperwork process, which agencies are specialized on and have all the necessary tools and connections to be able to make it happen quickly and efficiently. A small company or an individual property would not be able to keep up with all the documentation necessary to bring in lawfully and maintain a foreign worker in housekeeping. Another benefit I have certainly encountered is not having to deal with scheduling, payroll and overtime costs, which we all know can be a challenge in housekeeping. If you manage to arrange a contract where you pay for the work that is performed versus the labor, you are able to save yourself a good amount of hassles (and money). If so, you need to ensure you have a proper reconciliation process in place and an eye for your finances. The most difficult part is the relationship with the third party. You have to rely on them to perform the work according to your expectations and up to your standards and this can be tough at times, since the workers are not part of your company. Therefore I recommend to have regular talks, build a relationship of trust but also be very clear and consistent on the expectations. I recommend performing random checks on their work and giving them regular feedback. I recommend involving their people in company's training and activities so they can be and feel part of the culture and of the vision - if we don't share the same vision, we won't be able to achieve the goal together. In general I prefer handling my own employees, and manage the expectations and the performance myself with my team, I don't believe third parties are better at managing housekeeping operations. I do recommend working with an agency that can help you recruit and hire staff. As far as outsourcing housekeeping completely, my advice is not a yes and it's not a no, I simply advise to ensure you have all the right procedures in place if you decide to go for it.

Craig Coughlin · Answer

I believe that outsourcing businesses are only better at managing housekeeping operations because we invest and focus on this one department wholly and solely. Like so many things in life, when you gather the team and concentrate all your efforts towards making something better and more efficient you tend to get better results. The investment in technology to streamline operations and ensure faster and more direct communication is also critical in the fast paced hotel environment. So, overall it is not about who is "better" but who has the resources to drill down and concentrate on one dimension of the business - and in the current climate, this is the outsourced companies!

Ian Wilson · Answer

In my experience, outsourcing your housekeeping is good if you can use it on a variable basis to cover peaks and reduce fixed costs or if it gives you flexibility in a heavily unionised environment. Rarely does outsourcing save money, and it tends to be more expensive. If you can't find staff and your outsourcer can (legally), then you have an HR problem, not a housekeeping problem. I have never had an outsource company that could provide the same service as the in-house team.

Dina Angelucci · Answer

I have had the opportunity to work with the outsourced business model (full & partial) in various countries, in my experience I don't feel the agencies are better at managing the operation, what they do bring to the table is better flexibility and availability of resources and in some instances cost savings. The outsource business model can be as successful as you make it...Hotel must retain a gatekeeper and my preferred option is the partial outsource model. Outsource team members are interacting with our guests and contributing to our guest satisfaction experience, therefore the expectation and standards must be the same as you would expect from your own employees, when you are tendering for these services scope must be transparent. Housekeeping has always been " too hard". results are in real time, tasks, rooms need to be cleaned daily, our guests have becoming savvier, and we need to explore different ways to manage our business while delivering results and the outsourcing model is a positive solution

Christoph Hoffmann · Answer

It's a very interesting subject: the quality of service delivered by the housekeeping department shouldn't be defined by the employment type of the employees. Housekeeping operations, usually only seen as a cost centre, are delivering an essential service to hotels - without this service hotels don't have their core product available: a clean hotel room. It might make sense to change the perception from a 'cost centre' to a 'value adding centre' and consider what this departments needs to provide a great service to paying customers; no matter of an in-house team or a team coming via an outsourcing partner.

Soenke Weiss · Answer

The outsourcing debate is not new, but the current global situation is causing it to heat up again. The argument typically revolves around whether an outsourcing agency is capable of delivering the same quality and service levels as a hotel can with a team of their own, that they employ and thus control. In my view, this argument is moot as quality and service correspond to the level of cooperation and control between the hotel and the agency. Outsourcing agreements are no different than employment relationships - expectations and KPIs need to be clearly established, monitored and regular performance reviews should be standard practice. We know from experience that many hoteliers prefer not to deal with housekeeping as it is complicated and difficult to manage. Outsourcing offers the desirable predictability of costs that aligns well with occupancy, handballs the recruitment challenges, negates insurance premiums and removes some level of stress from the operator. Is outsourcing a panacea though? Absolutely not. An outsourced agency is working in the same environment as the hotel, experiencing the same occupancy fluctuations and challenges that are inherent when dealing with people. So why hand the core of your operation to another company? Because agencies are often better placed at managing occupancy fluctuations, have better access to the talent pool and make more efficient use of available technologies to manage the workforce effectively - all while managing service standards and quality requirements. A competent agency excels because of their razor sharp attention - housekeeping is not one of their areas of focus, it is THE area of focus. And economies of scale are very powerful. The management of hotels is changing just like other industries around it. Car companies maintain their quality, look and feel even though a large part of their components are produced by external parties. There is no reason to believe that the hotel industry is different and housekeeping may only just be the beginning. Outsourcing success is based on selecting the right, competent partner who is engaged, competent and shares the same vision. It is not a panacea, but it could present an opportunity for many properties that may not realise it yet.

Outsourced housekeeping - the panacea to all our housekeeping woes?

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