A realistic, yet optimistic overview of how the hospitality industry and institutions will adapt, survive and re-emerge from the pandemic. Invaluable insights from the head of the world’s leading hospitality school that range from the importance of soft skills such as empathy and communication to pragmatic crisis and team management.
A human reminder that “travel is the basic longing of modern people”.
Mr. Rochat, you are a profound connoisseur of the international hospitality industry and at the same time CEO of the world's leading hospitality management school: What is the question that currently worries you most?
Among the many questions, the most urgent and important one is: How can we re-boost our economy as quickly as possible? The standstill is highly dangerous for businesses. Funds are running out, employees are psychologically dependent and this is putting companies on the brink of the abyss. We need a careful, gentle ramp-up of activities.
How well-prepared was the hospitality industry for a crisis like this? Had it done its homework?
All tourism providers - as global players and as a thoroughly globalized industry - have known of the risk of a pandemic for years. We fought SARS when the airlines were grounded. We experienced bird flu when travel was restricted. So we were warned. But no one could have foreseen the scale of this crisis, especially the cascade effects and the speed at which it has occurred. This is threatening the existence of many hoteliers, restaurateurs and airlines. I would, however, attest to the high level of awareness of the problem on the part of the players - including our political authorities. All those responsible have reacted quickly and correctly. Even though the room for manoeuvre is small, I think Switzerland has a model function here in the DACH region, particularly with regard to the provision of transitional loans. I hope we can save a great many tourism providers, especially the friendly family businesses. In 30 minutes, 500,000 francs will be paid interest-free, and we need more governments to do the same.
Has the global risk of a pandemic been fundamentally underestimated? Should tourists have been prepared since SARS and MERS?
I think not. What we've underestimated is the psychology of such a phenomenon. And this is where we, as hospitality professionals, are called upon. Because our business can only be viable again if we succeed in securing the trust of our guests. Travel will initially be associated with unpleasant feelings. Empathetic hosts will be particularly in demand. This is a key competence that we here at the EHL are training very intensively with our future professionals.
Business continuity is currently a big word. What does this mean for a hotel business whose operations are paralyzed and the workforce is laid off or 100% on part-time?
You said it, these are big issues. We need pragmatic action and a step-by-step approach. We need a balance between the willingness to take risks as soon as business picks up again and an agile presence in the market. At the same time, we need to be extremely careful not to run offside in the event of a backlash. It is important to think in scenarios and to involve management staff with a lot of experience. Retaining these specialists must be top priority anyway. Having to reshape a team after such a crisis is impossible. In addition, intensive, open communication is needed internally - with regular staff information, video chats, a hotline and the like.
As a school, you are optimally-networked worldwide through your alumni: What are currently the biggest challenges facing hosts around the world? Do you notice any regional differences?
We hear from our alumni – after all, there are 25,000 worldwide and we can draw on their knowledge - that the first movement in the market is gradually becoming apparent in China and Asia. Social distancing, especially in the hospitality environment, is still key because there are concerns about relapse or new infections by returnees from Europe. In the USA, the market is completely down and the same applies to Europe - especially in the cities - which have relied heavily on overseas markets. The mountain hotel industry is better off because it is in the logical seasonal break. But here, too, bookings for the summer are slack, although the first signs of bookings in August are discernible.
So far, the trend has been very clear: The hospitality industry is booming, the demand for highly qualified specialists is increasing. Is the Corona crisis now putting an abrupt end to this trend? Will low-margin tourism definitely become a case for redevelopment?
I really don't think so. The hospitality industry is a growth industry, this much is evident. The know-how of these professionals is not just essential in the hospital sector or in old people's homes, but also in subsidiary areas such as the food supply chain. Tourism will pick up again. Travel is a basic longing of modern people.
The industry is currently in crisis management mode. If you look to the future, post-Covid, what trends do you see?
The opportunities for "off-the-beaten-track" offers are increasing. Hideaways and less- traveled regions will benefit. There will be a return to slowtravel, self-drive and touring are also in, camping and B&B's will experience a revival. And lastly, there will be a demand for apartment-style accommodation and long stay offers with treatments, especially for senior citizens who enjoy traveling. In general, domestic tourism and day tourism will boom.
What lessons do we as an industry have to learn from this global lockdown?
That there are no certainties in life, neither as a private person nor as an entrepreneur. And that foresight and sustainable management pay off. Building reserves in good times has always paid off, especially in difficult moments like now. Crass shareholder value models are probably at the end of their cycle, but that was already the case before.
Do hotel and restaurant businesses still stand a chance in times of "social distancing"? How can the industry counteract this latent fear of too much proximity in restaurants, spas, on planes, etc.?
Good question. It's going to take time. Offers where a lot of people travel in a small space will have a hard time at first. Flexible measures on the part of providers are also needed here. Distance in restaurants, free seats on the plane, seats instead of standing room at events, etc.
Many customers - especially in the corporate sector - have now learned that things work without face to face meetings thanks to video calls, Skype, ZOOM and Co. What do these experiences mean for the future MICE business? Does this change in the set-up have serious business consequences for the hotel industry?
The need to get together face to face is still important and cannot be bridged by telemeetings. But companies will certainly be more careful about how they invest their funds. The MICE business will not have the same characteristics it’s had up till now, that may well be the case. Smaller formats will be necessary, coupled with learning experiences and team building. The social effect of these meetings remains essential. And here we will also have to train hosts to become teambuilders, motivational coaches, mindfulness experts, etc.
Speaking of "Rethinking the Business": When the Swiss government closed down schools in Switzerland, did you have to convert your students to distance learning within a very short time? How has the EHL managed to do this so far?
In any case, we had prioritised distance learning as an essential part of our future strategy for the EHL Group and had already integrated it into our teaching. We have a powerful IT system and very experienced teaching staff. Our professors are very virtuoso in this respect. The target achievement and satisfaction rate is 95 percent.
Do you expect that teaching at schools and universities like the EHL will change permanently based on current experience? If so, in what way?
I think it certainly accelerates this transformation process in the educational landscape considerably. And that definitely helps us at the EHL, because we are pursuing a strong internationalization strategy with our three campuses: Lausanne, Chur/Passugg and Singapore from 2021.
Lastly, does the EHL Group have its own initiatives to support hospitality companies in this difficult situation? Who can those seeking advice turn to?
We are launching a broad-based consulting initiative by our experts from the Consulting Department. Thematically, we are concentrating on the "after". We want to offer free tutorials, we will host live chats and there will be an extensive knowledge base with Q&As, best practices and articles on recovery management issues available for download.
Mr Rochat, a simple but difficult question at the end: If this crisis is short and intense, it will pass. Or will the economy, and tourism in particular, have to live with the consequences for a long time to come?
Look, I'm not a prophet, however I dare to predict that tourism, as a sensitive industry exposed to global currents, will gradually recover. But not from one day to the next, it would be naive to think that. The airlines are facing enormous challenges, and intergovernmental relations and travel permits also need to be re-established. That will take some time. But definitely: Tourism remains an economic engine. In two or three years it will be back on top form, of that I am convinced.