Daily Archives: November 26, 2017

Dr. Aurora Dawn Reinke, ISHC, ISSP-SA writes a new monthly column for Travindy focusing on topics and research that support the business case for sustainability in hospitality and tourism.

The Journal of Hospitality Marketing & Management recently published a theoretical model for the relationship between room rate and sustainability (1). The study, which focuses on top line impact of sustainability, accounts for demand, price sensitivity, sustainability effort and costs, sustainability willingness to pay and demand, variable and fixed hotel costs. The authors determined factors that affect optimal room rate.

The negative factors were general price sensitivity, lower willingness to pay for sustainability, and the cost sustainability. Probably not surprising. We already know that higher price sensitivity tends to relate to lower room rates. This study shows higher price elasticity related to less investment in sustainability, which is more likely to occur in economy and budget hotels than in the luxury or midscale markets.

The three positive factors were:

• Hotel capacity, or primary demand. Large hotels not only have higher capacity but also the staff and financial means to implement, maintain, and grow sustainability. This relates to the effort factor.
• Customers’ sensitivity to sustainability. Recognition and preference for certain activities and features results in willingness to pay a premium.
• Type of demand. Hotels with a blend of leisure and business customers, based on events and seasonal draw are more likely to see positive relationship between room rate and sustainability.

There is also a positive feedback loop effect: More investment in sustainability improves ability to implement (effort) and increases demand and willingness to pay. This leads to greater ability to invest. At a certain point however, there is a point of diminishing return, but improved efficiency in integrating sustainability results in costs savings that enable the hotel to hold prices at an optimal level, increasing demand and allowing for more sustainability.

Takeaway for Owners

Sustainability programs tend to be set at a corporate level within companies that own or manage a diverse set of properties, and one size does not fit all. Many owners have a mixed portfolio that includes a range of property sizes, market conditions (demand generators, competitors, etc.), brands, and star levels. Executives can use this research to create a sustainability strategy that accounts for these differences.

For example, there may be a subset of hotels that get minimal sustainability upgrades with sufficient cost savings to maintain or lower room rates. Another subset of properties will have a more integrated and intensive approach to sustainability because the macro and micro conditions produce the positive feedback loop presented above. Executives deeply committed to sustainability may even choose to require properties in their portfolio support an ongoing, profitable investment in environmental and social initiatives.

Similarly, revenue managers need to account for such factors. Using industry and past performance data, they can create what-if scenarios to optimize prices based on the input they already use, plus sustainability as an influencing factor.

Drawbacks

There are two downsides to point out. One relates to results of the study; the other relates to the methodology.

First, for economy and budget hotels, the revenue argument is not strong. We need research and tools that demonstrate the ROI in terms of employee retention and performance, and costs savings (many of which are well documented, and others in need of more research and data). The news is not all bad for sustainability advocates in this category; it just means using different models and approaches to make the business case.

Second, a weakness of the study is that “sustainability effort” is both complex and vague. The idea is that as a hotel gets more adept at executing sustainability efforts, the effectiveness and efficiency improve. But putting numbers or a rating to this can be complicated. Financial decision makers may need to do some research and data gathering to determine “effort level.” Furthermore, the authors recognize that sustainability could be broken down into social and environmental. Other studies show willingness to pay is higher for some sustainability efforts than others.

Calling All Math Geeks

If you’re a numbers-oriented person and not afraid of a scary looking equation, I recommend you read the full article and test the theory using your own data. I would love to hear about both the results and the experience of gathering the data and calculating your optimal room rate.

Travindy’s new columnist Dr. Aurora Dawn Reinke, ISHC, ISSP-SA, founded Astrapto to bring about sustainability change in hospitality, travel, and events. Astrapto Academy offers practical online training and toolkits to make sustainability simplified and approachable for busy industry professionals. Aurora’s contribution to sustainability in these sectors includes chairing the Business Travel Working Group for the Global Sustainable Tourism Council (GSTC), serving on the sustainability committee of the Global Business Travel Association, and on the redesign task force for green meeting standards for the Events Industry Council. She is always open to dialogue and ideas for how to promote the sustainability business case – email her at [email protected].

reference (1) Xu, X., Xiao, G., & Gursoy, D. (2017). Maximizing profits through optimal pricing and sustainability strategies: A joint optimization approach. Journal of Hospitality Marketing & Management, 26(4), 395–415. https://doi.org/10.1080/19368623.2017.1245168

It was clear at the World Travel Market in London in early November that the number of individuals, institutions and companies actively engaged in an aspect of transforming tourism is expanding. While being undertaken mostly by small-scale enterprises, more individuals within the larger corporates associated with mainstream tourism are also playing their part. Every initiative to reduce tourism’s footprint; improve the livelihoods of guests and residents; tackle injustice; alleviate poverty, conserve wildlife, clean up damage etc. is critical and to be applauded. So I am looking forward to [Travindy Editor] Jeremy Smith’s forthcoming book Transforming Travel that highlights numerous examples of transformation happening around the globe.

But the nature of the “wicked problem” that tourism’s current dependency on volume growth causes, means that these individual efforts on so many diverse fronts still lack the power to alter our current trajectory. They may slow down the passage of the Tourism Titanic but not prevent its ultimate collision with the iceberg. Susanne Becken rightfully and courageously addressed this problem head on in her presentation to the WTM (see her article Carbon and Tourism Where Next? referring to it as the fallacy of incrementalism. I support her 100% and am willing to go one step further and suggest that it’s not just fallacious but fatal for these reasons:

1. Incrementalism is not working. Despite all the earnest efforts of individuals around the world, we’re being undermined by the prevailing commitment/addiction to volume growth and a refusal of those with power and authority to question this strategy or re-define more helpful ways of defining growth and success. Interestingly, all the signs suggest that 2017 will be a bumper year for tourism with growth rates exceeding already ambitious forecasts.

2. We’re also undermining ourselves because we haven’t broken free from so many of the assumptions and beliefs that drive the old model – a focus on parts not wholes, on things not processes, on problems not potential, on scarcity that drives competition not abundance that comes from cooperation; a reluctance to share and collaborate; the need to control and over systematize, standardize and quantify; a reliance on rational, financial arguments and incentives; a failure to appeal to hearts and minds; the promotion of and dependence on experts that disempower communities; use of language and jargon that reflects the old paradigm and excludes; plus a belief we can use sustainability for competitive advantage. In short, we have ignored Einstein’s injunction and are using the same way of thinking that developed the problem to correct it. For another perspective on this, read David Holzmer

3. It breeds a false sense of progress and actually sustains “business as usual”. In fact I would venture to suggest that those parties who resist change (and they tend right now to be the most powerful in the system) use these incremental achievements of others to distract; as cover/camouflage to actually sustain business as usual.

4. These incremental efforts, while essential, do not address the root cause of our dependence on volume growth. The real cause of our predicament is “a way of seeing and being” on this planet that is no longer accurate (science has turned virtually all assumptions about how the world works on their head); no longer produces the outcomes intended (i.e., greater welfare/well-being) for the many; and leaves far more value and net benefit unrealized than it produces. Ironically it fails the hallmark of a successful industrial system – it’s inefficient and under-performs! Tourism may be growing in size but the net value generated per trip is, given the proliferation of cheap flights and cruises, not necessarily going up at the same rate. (Note: global data on net income desperately needed!!).

It’s long been recognized outside of tourism that the narrative (a.k.a. story, worldview, paradigm, consciousness) has to change first or we’ll continue to dig the hole we’re in deeper. (George Monbiot is one of the most recent proponents of this view (see: How do we get out of this mess? ) but many other luminaries have been saying this for half a century or more.

But who wants to take the time to figure out a new narrative? The old story dominates every nook and cranny of our consciousness urging us to “be practical” which means “do something dammit, ” get results, be measureable, analyse more, get more data, produce tangible results this quarter etc. so we have another conference, call for papers, publish another declaration, create another symposium or summit. There’s no time in our busy, overly competitive lives, now run by machines and systems; to stop, breathe, let alone think, reflect and question. The latter activities were actually designed-out of our way of working decades ago. (Image below source from Danone a company that’s working on narratives)

The word “transformation” has become popular this year but do we understand what that, once powerful word, actually implies? It’s change on a scale most of us are unfamiliar with despite our living in a period when every aspect of life and living is changing at an unprecedented rate and scale all around us. Richard Barrett of The Values Centre, a pioneer in the study of coporate culture and values observes.

• Change is doing things differently. Transformation is a new way of being,
• You can change without transforming but you can’t transform without change and
• Organisations don’t change, people do!

Transformation is the opposite of the incrementalism that Susanne Becken warned us about. To qualify as transformational, change has to face and overcome root causes of a failing system or be exposed as mere tinkering i.e., yet another “makeover”. Transformation is nothing less than systems change. But here’s the rub – transformation has to start within the hearts, minds and consciousness of people like you and me or it won’t happen at all.

Transformational change doesn’t cut the engines of the Titanic to slow it down, it steers the vessel in a very different direction.

So what will it take to turn this great vessel of tourism around?

1. Push the door of our mental prison – it’s locked in the inside

Thinking small won’t serve us. Going it alone won’t either – especially if we are motivated to “get one over” on others.

Never has there been a time in history when so many of us were being asked to move out of our comfort zones; out of our shells, our cubicles, our departments, our silos, our specialties, our functions, companies, agencies and institutions, even our spheres of influence and join hands, hearts and minds as human beings and ask: What’s really happening? What on earth am I doing here? Is this all there is? What do I long for – if not for me but for my children or my friend’s children? What gift of my being can I share and develop?

This first step – recognizing that we don’t have to settle for mediocrity; that we can learn to dream big again and, each of us matter and have a role to play and a responsibility to play it – can be taken alone. It is primarily an inner journey as we re-examine our personal values, beliefs and assumptions. But after that, the journey requires and is enriched by companions.

2. Acknowledge that we’re all in this together and no hero is coming to save us.

We’re each different and unique and that’s a huge positive, but only if we start listening, sharing, co-creating, contributing and, most importantly, learning together. Because in this brave new, utterly joined up connected world of ours, each of us do matter. Hogging power and authority at the centre is as fatal as incrementalism. True innovation, creativity happens at the edges between order and chaos. It emerges from dialogue, interaction, relationship, flux, and conflict and depends on diversity, honesty, transparency and a willingness to fail as often as to succeed

Leadership and power are currents that flow through a group to be shared and expressed in varying amounts by each participant according to circumstance. What matters is that we learn to “see” and care for the whole (i.e., life, humanity on this planet) and our role as contributing to its flourishing.

3. Commit to seeing “clearly”

We’re being asked to open our eyes, to wake up and see who we are as individuals and members of a species that now holds the balance of life in its hands. It’s less about saving the planet than saving ourselves and the other life forms that have become dependent on our capacity to act in their interests as well as our own.

Virtually every challenge you can think of, in general and in tourism specifically, stems from the success of a system we humans designed – albeit incrementally over a 300 year period. It’s called the industrial production-consumption system refined more recently by a particular form of economics that seems rigged to benefit fewer and fewer each year that passes. (George Monbiot, by the way, referred to just one layer of a multi-layered narrative that digs deep into what it means to be human). The impact of that system on the rest of the life and inanimate matter on this planet has only become apparent in the last 60 years ago. What appeared to be efficient and effective is now delivering outcomes and side effects that are sufficiently harmful that they will break the system itself. A system re-design is called for. But unless we understand what assumptions, beliefs and values underpinned the old decaying system we won’t be able to change or correct them when designing a better one.

Hence the need for a massive re-framing of our thinking (changing the paradigm or story) and that has to be taken throughout society and throughout the community of people who work in the tourism and hospitality as part of it. Most importantly, this process involves inner and outer transformation – a willingness to better understand what goes on in our own, individual hearts and minds as well as what we say and do in our families, communities and workplaces.

4. Be willing to consider re-defining success and purpose.

In order to create and sustain the vast global system of product and consumption that has now infiltrated every corner of the planet (even bushmen of the Kalahari now know they need money to survive) humanity has been entranced – put under a spell. A spell that says to survive and thrive money/cash is essential; making and spending it our role, function and purpose; and the acquisition of it the primary sign of success. As the sun passes over our revolving planet from the hours of 6:0am-9:0am, the global population wakes up and performs virtually the same preparatory rituals for a day of work or play that increasingly involve, for many, the need to completely numb ourselves for “the “commute; ” and leave large parts of our “selves” at home.

Be it at the individual, corporate or community level, we’ve been lead to believe that our purpose is to contribute to generating more wealth in the form of income, profit or GDP. This wasn’t always the case – ask any indigenous person and you’ll see how recently the spell has enchanted us all.

Even a few hundred years ago, the purpose of an economy was to create welfare for the many and income, profit and GDP were seen as the means to do so. But since, we have switched means for ends despite the fact that the capacity of these means to produce greater well-being, greater health and happiness is now diminishing.

The simple most effective way to start to turn the Tourism Titanic in the direction of safety will be to re-define our shared assumption that more visitors will bring more benefits and focus instead on increasing the net benefit. That will require a far deeper understanding of the nature and scope of costs incurred to support each visitor and a commitment to grow the benefits their visit generates in real, net terms. Many of these costs and benefits are difficult if not impossible to quantify but the party best able to identify them is the host community. In most cases they will be paying to mitigate the costs and, as importantly, only host communities can really identify what they perceive as a benefit.

Only when we’re ready to admit that our incremental steps are insufficient and that we need to recognize and internalize the four truths listed above, can we begin to re-design a system that works for all. That’s why, the focus of our work is on community education and empowerment and pushing that mental prison door wide open!!!.

This article was first published on Linkedin. Follow Anna Pollock on Linkedin to read all her articles.

There is now a substantial body of research on gender issues in the tourism and hospitality industries, with reports examining gender in relation to employment, and representation of women in senior industry roles. But what about tourism as a research community: how are the genders split, and do women have equality with men in prominent positions in academic bodies and at research conferences? In a paper recently published online in the Journal of Policy Research in Tourism, Leisure and Events, Walters (2017) examines 53 academic conferences in the subject areas of tourism, hospitality, leisure and events. She finds that while women are well represented as conference chairs, there is unequal representation in prestigious roles of keynote and invited speakers.

Data were collected between mid October 2016 and mid April 2017 from the websites of relevant conferences to be held in the 2017 calendar year. Gender was analysed for five conference leadership categories including conference chairs or convenors, keynote speakers and expert panel participants, and organising, scientific or honorary committees. Gender balance in these leadership roles were compared with the composition of the TriNet community of tourism researchers as a proxy for the gender balance of leisure and tourism researchers overall, which shows an almost 50:50 split between men and women.

in one conference which highlighted ‘Equality, gender and diversity issues’ as a conference theme only one of the six Organising Committee members and less than one-third of Scientific Committee members were women

Among Chairs or similar roles, no gender gap was observed. Of the 79 individuals identified, women comprised 42% of Conference Chairs, Convenors and Presidents of Organising Committees and men accounted for 58%. This gender distribution shows no significant difference from the TriNet community. However, the study finds gender inequality in two types of roles – Keynote Speakers and membership on Honorary Committees – where there is statistically significant under-representation of women. It also identifies areas of tension between some host association values/aims and conference aims/themes and actual gender representation in conference leadership roles, finding a gap between rhetoric and action. For example, in one conference which highlighted ‘Equality, gender and diversity issues’ as a conference theme only one of the six Organising Committee members and less than one-third of Scientific Committee members were women.

The paper discusses the implications of gender inequality on both women academics and knowledge production in these fields, and suggests avenues for future research. These include an examination of whether gender equality at our academic conferences ‘matters’ to attendees, and investigating perceptions and impacts of under-representation of women on graduate students and emerging scholars.

The current (Volume 18, Issue 4) issue of Anatolia focuses on gender (in)equality in tourism academia; it goes ‘beyond the numbers’ and the varied contributions show a gendered landscape that extends from the curriculum through to how ‘top researchers’ in tourism are celebrated. Pritchard and Morgan (2017) provide compelling evidence of gendering in academic performance indicators in tourism – such indicators ‘make and mark its leaders and shape its knowledge canon’. The paper presents interventions to accelerate academic gender equity. Basurto Barcia and Ricaurte Quijano (2016) found in Ecuador an underrepresentation of women in teaching (53%) in relation to the percentage of female tourism students (75%).

This article was first published by David Simpson on Cabi.

Reference

Walters T (2017). Gender equality in academic tourism, hospitality, leisure and events conferences. Journal of Policy Research in Tourism, Leisure and Events. https://doi.org/10.1080/19407963.2018.1403165

Further reading

• Basurto Barcia, J., Ricaurte-Quijano, C., 2016, Women in tourism. Gender equality in teaching and research in Guayaquil, Ecuador, and its surrounding area, Ecuador., Estudios y Perspectivas en Turismo, Vol. 25, No. 3, pp. 255-278
• Pritchard, A., Morgan, N., 2017, Tourism’s lost leaders: analysing gender and performance., Annals of Tourism Research, Vol. 63, pp. 34-47