Dubai’s bid to organise the World Expo 2020 was pronounced successful late last year when it was officially announced as the host city for the Expo, which has created a buzz within the country and the region. Not only does this give the UAE and the surrounding GCC countries an economic boost, but it also raises Dubai’s stature as the hub of the MENA region – definitely THE place to be in 2020.
Barbara Arensmeyer, Director-Housekeeping Complex, The St. Regis Dubai; W Dubai – Al Habtoor City; The Westin Dubai Al Habtoor City; said, “At the moment, the forecast for the hotel industry is not so promising. There is definitely a downfall in the expectations from the past performance of the industry - but there will be another surge in growth for Expo 2020. This is a pattern – there is a peak and then a downfall – to curb this, Dubai has to have other attractions to maintain the level of tourism.” Tatjana Ahmed, Housekeeping Manager, Grand Hyatt Dubai; and Chairperson, UAE Professional Housekeepers’ Group, agreed saying, “The number of hotel rooms that are increasing are going beyond that. Dubai wants to be a tourism hub – evidence is in the various museums, theme parks, etc. that they are currently in the process of creating. And therefore, there is more demand for the cleaning industry.”
Benjamin Wessendorf, Head of Soft Services, Dussmann Middle East GmbH, said, “Almost 200 new hotels are being signed off and only 10 per cent are focusing on the mid-range. So, despite there being a massive boost for five-star hotels, we are missing on targeting the people who can’t afford 5-star hotels, which might be an issue for the industry afterwards. The challenge will be to come up with a sustainable solution to attract people to return to this amazing place.”
Sherif Fahmy, Sales Manager-Hospitality/Building Care, Sealed Air Diversey Care, felt, “With the various currencies devaluation, supply increase, and low oil prices, the need for a market segment of 3- and 4-star hotels is increasing. Although the current occupancy rate has not gone down significantly year-on-year, the TRevPAR went down by 6-7 per cent, if I remember correctly.” Research shows that almost 200 new hotels are being signed off in the region, and 26 million visitors are being expected to stay roughly 3-4 days for the expo peak season.
John Harley, General Manager, Al Fajer SM Services, added that there is a shift in the perception of hotels in the region. He agreed that there is a slew of mid-range hotels being constructed that will cater to the mass market – and that is where the actual growth will be. He said, “As of now, roughly 1 out of 10 people that pass through the airport actually stay in Dubai, if we can raise this number and ensure that people stay for at least 2-3 days, it would be a big boost to the economy and hospitality sectors.” Mid-range hotels are more about functionality than luxury – hence their costing base and potential for the cleaning industry is also different – especially when it comes to concepts like outsourcing of staff – which is easier so that these hotels can vary the staff according to the occupancy rates and keep costs under control. Hence, mid-range hotels seem to be a bigger market for the cleaning industry because it is more cost-based.
Need for synergy
Barbara said, “Quality is the biggest concern for all of us. Contractors promise everything – but when it comes to the quality of the people, supervision and training, I find a huge gap.” Wessendorf suggested, “To ensure that we bridge this gap, contractors and hotels must work together. It is important to have flexibility in demands on the part of both parties. Therefore, both must be invested to ensure that the end customer is comfortable.” Harley said (to the client), “We have to work together within particular parameters with who can provide that. After all, a contractor’s employee promotes your brand. That person then is technically yours. How much do you as a client want to pay that person; accordingly you will get the quality and standards.”
Peter Leys, CEO, Intercare Ltd., agreed, “It is absolutely fundamental that expectations of both parties are made transparent as long as you stay on the job. Also, it’s true that there is a huge opportunity to raise standards and increase productivity. We should not consider people a commodity based on the number required for a certain job – there needs to be a fundamental shift in that mindset across the industry. We can probably all agree that it would be in the interest of everybody. As suppliers, we are very keen and capable to help in that process.”
Harley agreed, “Our perception of ‘cleaners’ must be changed. They are cleaning technicians.” Leys added, “I think even at the higher level, what is missing is giving people at all levels the feeling that what they do makes a difference. If cleaners are not really convinced about it, and are not paid/treated well, they are not motivated to do their best. That is sometimes the challenge for facility managers – because they are paid by the facility manager and not really by the guest experience, which ultimately drives the hotel. In a nutshell, it’s not only financial incentives but also appreciation, status, and visibility.” Harley also said, “Quality of cleaners is also affected by perception.” In Dubai, the perception is that labour is cheap. Currently, all Asian countries, from where manpower is sourced, are aware and imposing minimum salary levels. “And, we are looking for loopholes to circumvent that. But, then we don’t get the quality of manpower that we require.”
The government has now put pressure on contractors with the new labour law where if a new recruit - technically after 6 months (where the contractor has incurred the cost of the visa, travel and training costs) - has the freedom to change his/her job. Harley said, “I think the contractor industry has quite a problem on its hands both to get clients to accept that if you want sustainable quality, this is what it’s going to cost, but don’t think it’s the same as the guy you had before, for that person is going to be trained to the required level. On the whole, going to 2020, the competition in manpower sourcing, training to raise the quality, etc will be difficult, if we don’t solve these issues.”
On that note, Arensmeyer suggested, “Contractors’ people management and facilities should be looked into. A lot of companies are offering very low salaries and accommodation facilities, which are below standards. We expect these people to then provide 5 star services, when the basics are not provided. It is not surprising that they are now asking to move out of the contract to work permanently under hotel sponsorships, which is difficult and not budgeted for. To solve this, however, I feel we should check on the root causes - are they taken care off, have better facilities or pay? It’s all about people management.”
Ahmed added, “I think what is also important is that the companies that hire the contractor must let them be part of their success – that they are integrated into the community. Contractors and fulltime employees should all have the same facilities, be part of the same activities and maybe get a bit of the service charge the hotel is making in order to make them both committed and motivated.”
Contracts and outsourcing
Another problem is in choosing the right contractor. With over 3,500 service companies in Dubai, how can a client decide who’s going to provide what? Harley said, “Everyone has an ISO, so how do you judge? There should be a body for the cleaning and hospitality industry, which we have tried to bring about for years!”
Arensmeyer said, “We go with recommendations. From a housekeeping perspective, I would utilise a professional company, but there are many such companies offering services with lower rates. And the decision makers are opting to sign them to drive a more economical business; but it is not necessarily better. The housekeeping department must invest more time in training and supervision to keep the high standards. At the end of the day, quality has a price. This has to be defined with certification.” Wessendorf agreed, “We invest a lot of effort into something unique – conduct studies on how we can decrease the manpower rate, increase technology, quality but most customers’ mindset is still not set.”
This is why a partnership has to come in, reiterated Harley. “How can we provide the full range that you require – trained and skilled people to complete your requirements; instead of dealing with 4-5 entities, you can deal with one entrusted entity which reduces costs. Then as a contractor, instead of a single service, we look at a complete service across the board.” He also suggests quantifying services on the basis of what a hotel specifically requires. “We as contractors sometimes mix our staff – the same person may work one day in a hotel and the next day in the mall. Can the hotel industry help contractors by offering some sort of hotelspecific training? It is certainly something that we as contractors should look at. Maybe it goes back to the partnership that we were talking about,” he said.
Leys suggested that a facilitating step would be to have longer contracts, with break-up clauses related to performance. So, the client could get out of a contract but essentially the partnership is for a longer period. He said, “On the other hand, the cost increases and the variability of the work needs to be costed. A partnership in a contract should work both ways; eventually the staff will be the beneficiary because then there’s an incentive to train because you get the rewards, such as improved performance in the productivity during that period. So it’s a little bit more long-term thinking.” It should be a two-way communication, felt Fahmy. “Today, we see contracts coming up with over-demanding conditions. As a supplier, we partner with the service providers, and we demonstrate manpower savings through our innovative solutions that are meant to drive efficiency. But, we find the service provider stuck with an input-based or headcount kind of contract. And for the sake of being awarded, the contractor has to accept all tender conditions.”
When it comes to training, Leys observed, “The mid-management supervisors are actually more critical. They are the people who interact everyday all day with the staff. They can be the biggest change agents to make the improvement.” According to Fahmy, “The major concern is that they have the ‘how’ to clean, but they lack the ‘why’. We need to develop the why in our technicians. We need to really spend time to educate them. If they learn the need for them to clean, they will excel and show dedication. Today if the supervisor is not around, they may skip a step.” Ahmed interjected, “This is where you come in as a supplier to do the training. I remember a couple of years ago – you trained our teams in green certification and they do know now why they use a certain chemical and why they use microfiber.”
Wessendorf added, “I think from our side, BICSc gives us procedures, standards and the ‘how’. Why is probably not as integrated – and that’s why we, as a company, come up with a set of training activities from our side. I think emphasis should be on the project managers’
Leys said, “The drive to get an independent verification of a training standard is important. Maybe in the development towards the Expo – we still have a couple of years – we could really set ourselves some targets. Every year, we can qualify 10 per cent of the workforce and by 2020 we at least have 50-60 per cent qualified workers trained in specific sectors. It might just be a catalyst for some fundamental change with real merit and value thereafter.”
According to Fahmy, “The keywords are sustainability and operation efficiency for a supplier to help a service provider or even a client to manage their operations in a more efficient/environmental friendly way. Training should be designed and agreed on for a yearly period and should hold a mix of topics, which should be mutually agreed upon considering the period, the frequency, the caliber to be trained (cleaner/supervisor). Training should also be customised as much as possible by having initial discussions with business partners, understanding their requirements & align with their expectations.”
The internet of things
Wessendorf said, “As a family-owned company with immense experience in FM, we can take quick decisions. Plus, we are focusing on new concepts and innovative solutions to be as independent from our suppliers as possible in terms of training and other solutions, which makes us stand out. A standardised mechanism through smart applications and solutions – telling the technician how to use a product, apply it and understand the procedure will help us reduce the number of training hours by increasing the accuracy of service, while allowing us to gather greater data than before.”
“I’m a little skeptical to be honest,” said Leys. “In this region, there is a gap between the quality of staff, the tools and how they interpret that. It is risky to rely too much on technical tools. My plea is to reduce the staff and double their salary – with a commitment to training and people who are twice as productive. It needs the commitment to develop those people and then once they are developed, then those tools can be on the top. Currently, we are at a level where basic skills like command of English and fundamental understanding of cleaning and hygiene is limited. To make it all electronically available where they clean, in my view, is not the highest requirement.
I want to avoid falling into that trap and not be committed to investing in basic training and people. We need to ensure we are an attractive industry, location and employer and we can only do that by raising the standards. Training must be something beyond the support of the supplier: it must be separately billed and meet an external certification standard.”
After Expo 2020
So, what happens to all the hotel rooms and manpower after Expo 2020? Fahmy said, “Definitely, 2020 is not the final destination – it is just an enabler for Dubai to promote itself as the hub of the region and the world perhaps. That’s why you see so many entertaining projects and theme parks coming up – and all are premium projects.” Harley felt that there are always going to be risks after 2020 – but there is a lot of potential. He said, “All the construction that will be built for the Expo will have to be maintained and to a quality standard
to ensure that they last for 50-80 years, it could be boom time for us contractors.”
However, Leys cautioned, “There’s also a real risk related to the Expo on the perception of Dubai as being expensive. Already now, we have the highest average hotel rate in the world that is related to the mix of hotels, the lack of 2-3 star hotels. Last year in Milan, during the Expo, all the hotels more than doubled their prices due to the lack of capacity. If we have this happening in the UAE, tourists will have the permanent impression that Dubai is extremely expensive and not sustainable.
Therefore, it is important to consider how to get additional capacity during Expo, in order to moderate the prices. There are significant entities that are not yet big here – Airbnb for example. Maybe even a supplemental volume of apartments, which can be used temporarily.”
The entire panel also agreed that they must be updated with the newest technologies and materials coming into the market. Harley concluded, “Costs are going to be a major factor from now to Expo 2020 and after, so the more efficient the sectors can be, the better – it’s a win-win for all parties involved.”