'We know we must grow and be profitable, but we must take charge of doing that in the right way' - Q&A with Karin Sheppard, IHG

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Karin Sheppard, senior vice president & managing director, Europe, IHG Hotels & Resorts // Photo courtesy of IHG Hotels & Resorts

The Annual Hotel Conference gathered hospitality leaders in Manchester at one of the most crucial times for the industry. Hospitality Insights caught up with Karin Sheppard, senior vice president & managing director, Europe, IHG Hotels & Resorts about learnings from the past 18 months, new initiatives to support staff and drive recruitment and growing business responsibly across the IHG portfolio.

How can the hospitality industry take advantage of the crisis?

For many of us, Covid-19 has given us an opportunity to reset as it came at a time where our industry was already dealing with major developments.

Consumers were being driven to make more sustainable lifestyle decisions; competition for international market share was ever-growing all with the added pressures of catering to an ageing and growing population. It has provided an opportunity to realign how we want this industry to grow in the future so that we can be more resilient to life-changing events like the pandemic.

As a result of this, there is now an increasing expectation more than ever to do business responsibly and act upon social good. Living in an ‘always-on’ world where being open, thoughtful and true to your purpose is key, presents us with a great opportunity to move forward and act with a broader purpose not only as a business but as an industry overall.

What one thing can help accelerate the rebirth of UK hospitality?

Recovery for our industry will continue to be multi-dimensional as things change, and there isn’t a one size fits all approach. However, something I think we can all agree on is the need for the thoughtful collaboration. Hospitality is part of its local community and ecosystem – suppliers, employees, authorities, consumers – it is all connected. So, by working with those around us, including partners, governmental and industry bodies, we can come together and work towards common goals to support our sector in a range of ways. At IHG Hotels & Resorts, there have been several ways we’ve been doing just that to support our recovery including our partnerships with UKHospitality, WTTC, VisitBritain and Sustainable Hospitality Alliance.  

How is IHG solving the workforce challenge, both the recruitment and the wellbeing of the employees?

Our people are our most valuable asset on any level and there’s no denying that the physical, mental and emotional wellbeing of our colleagues has been pushed to the front of our agenda over the past 18 months, exacerbated by staffing shortages right across the industry. It requires understanding from leadership to respond to the challenges our teams have encountered and to ensure they have been equipped to support and coach their teams during the toughest of times.

Coming out of the eye of the storm, we’ve focused on re-setting the clock and looking for new ways to support their wellbeing. We’ve made conscious efforts to provide our hotel and corporate teams with 1-to-1 peer learning through the creation of online platforms and support toolkits that aim to make the biggest impact on their wellbeing. We’ve carefully built upon on our Mental Health First Aider (MFHA) community amongst many of our hotels, with key HR support to facilitate a wellbeing agenda which included this year a programme as part of IHG’s Global Inclusion and Wellbeing week.

When it comes to recruitment, we’re able to find and develop the talent that the industry needs by working closely with our partners. We’ve seen some great success in recent months with the rollout of end-to-end recruitment guides and in-house hotel recruitment days which have been a fantastic way to support the talent acquisition process from start to finish.

And then it’s about ensuring greater accessibility to our industry and demonstrating it as a great place to work. In the UK, we’re proud to have recently evolved our IHG Academy offering, as the first market to launch IHG Skills Academy. This best-in-class learning platform offers free online education courses and opportunities for people looking to build their confidence and become employment ready. Whilst it will take a united effort to boost and change the perception of our industry, we hope that actions such as this will directly support those who are currently facing barriers to education and training.

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IHG Academy, Holiday Inn // Photo courtesy of IHG Hotels & Resorts

How do you balance the pressure of driving profitability with environmental concerns and the impact of travel on climate change?

There’s been a natural shift over recent years for the two things to align closer together. For example, as a UK-listed company, we see a real increasing appetite from our investors to understand our non-financial disclosures around ESG metrics, alongside our usual financial ones. This is a shift we’ve seen from other stakeholders too, who are paying attention to how we set goals to be more responsible and want to understand the risks we pose as well as the risks we face. For example, 80% of consumers told us in a recent survey that it is important to choose a hotel brand that operates responsibly – and they are willing to spend more for it, as well.

As an industry, we know we must grow and be profitable, but we must take charge of doing that in the right way. By looking at the two together, you can really understand how doing business responsibly can be supportive of your business model and make you all the more resilient for it.

How is the shift in customer demand impacting IHG’s business strategy?

The beauty of our industry means that there is always room to grow and evolve. What’s key is how you do that thoughtfully, in a way that is right for your guests, owners and operative model. One of the ways we’ve seen this at play is in our newest brand, the Vignette Collection – launched just a few months ago. Owners of independent luxury hotels and small chains are increasingly attracted to the opportunity to benefit from the scale, expertise and investment of a global hotel brand leader such as IHG Hotels & Resorts. Vignette Collection gives us a compelling way to welcome these hotels into our brand family whilst maintaining each property’s distinctive identity – something we know our guests love within our hotels. What’s important is that we know it’s not about having too many brands, it’s about having the right brands, distinct brands that meet the needs of our guests and owners.

Throughout the pandemic, we learnt a lot about what matters most to our guests when they stay with us, which came down to key things like their safety and wellbeing in our hotels, having a great breakfast, and a seamless digital experience. Learning this meant we were also able to step back and remove anything that didn’t add value in our hotel operations, such as fewer printed items and removing clutter from our rooms, which in turn alleviated pressure on our hotel teams – freeing them up to deliver our usual great guest experience

Undoubtedly, there has never been a greater focus from consumers on making responsible choices, so we’re investing in more solutions to help them do just that. Whether that’s using AI technology to reduce our food waste or our removal of tiny single-use plastic toiletries in favour of larger bulk bottles, we know that guests rightly have expectations for a high-quality yet responsible stay and experience.

What regions are you paying close attention to now?

There are some really promising opportunities to increase the scale of our portfolio across both Continental Europe and the UK. We have expanded our development teams in the market which are comprised of skilled, incredibly talented, and motivated individuals tasked with delivering on every aspect of our partnerships. Whilst we will continue to look at opportunities in our largest scale markets like the UK and Germany, I am also very excited about the momentum across the Southern Europe region, particularly in France and Italy in the luxury space, as well as room to grow in emerging markets such as Turkey, Russia and Iberia. All to say, there are clearly plenty of great opportunities for us to expand our brands to meet the needs of our guests and owners in a number of markets and we’re well equipped to make the most of it!

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InterContinental Rome Ambasciatori Palace // Photo courtesy of IHG Hotels & Resorts

What project in your pipeline are you most excited about?

Now, that’s a difficult question to answer – there’s so many to choose from! I am excited about every one of our 150+ hotels in the Europe pipeline. If I had to give a couple of examples, in the UK it would be Hotel Indigo Clerkenwell for a start. The brand is steadily increasing its footprint in this market, and it will be great to see Hotel Indigo further strengthen its presence in the capital too.

We’re also seeing a lot of momentum with InterContinental – the world’s first truly global luxury hotel brand, and next year, we’ll welcome InterContinental Rome Ambasciatori Palace as well as the InterContinental Grand Ankara, Turkey.

Our largest and fastest-growing brand, Holiday Inn Express, has just surpassed 3,000 hotels globally, and we’ll be adding to that figure with our latest Europe signing for the brand in Sion, Switzerland. There’s also a focus on some of our newer brands that are suitable for conversions, such as voco hotels. It’s hard to keep up with the signings and openings taking place for voco, but there are some great properties having just opened their doors in cities like The Hague, Netherlands; Milan, Italy; and Paris, France.