Transformation plan for Singapore’s hotel industry to ensure sustainable growth

An initiative to transform Singapore’s hotel industry to ensure sustainable growth was announced on Monday (Nov 21). ChannelNewsAsia

The main strategies outlined in the Hotel Industry Transformation Map (HITM) include building manpower-lean business models, encouraging innovation and internationalisation, and developing a strong pipeline of talent.

Speaking at the launch event, Minister for Trade and Industry (Industry) S Iswaran said customer expectations are rising and becoming more sophisticated. “We need to innovate service modalities to better engage guests,” he said. “On the manpower front, our ageing workforce and changing aspirations of jobseekers necessitate the adoption of the productive and manpower lean business models to sustain growth.”

If the hotel industry is not transformed, Mr Iswaran said achieving the same growth as in the past will be increasingly difficult. Latest hotel statistics from the Singapore Tourism Board (STB) showed that standard average room rates from January to August have fallen 2.9 per cent compared to the same period a year ago. Meanwhile, revenue per available room declined 2.7 per cent over the same period. To support older hotels in redesigning existing infrastructure to implement productivity-enhancing solutions, STB launched a retrofitting grant in April and Mr Iswaran urged hoteliers to tap on this grant.

A four-month programme was also developed by STB, Workforce Singapore and McKinsey & Company to guide hotels in identifying and implementing productivity initiatives. A total of 16 hotels are expected to participate in the Lean Hotel Initiative early next year.

Mr Iswaran also encouraged hotels to work with government agencies IE Singapore and STB to internationalise and enter new markets. He cited opportunities to bring along other businesses in adjacent industries like retail, food services and food manufacturing industries. Overall, the HITM is expected to create 200 new PMET jobs each year until 2020. Rank-and- file jobs, too, are being redesigned for better wage and career progression. For the first eight months of 2016, Singapore’s international visitor arrivals rose 10.3 per cent compared to the same period last year. – CNA/xk