Why Hospitality Struggles with Innovation

As a former innovation manager for a large hotel company, and a product manager for a large resort company, I’ve officially resigned myself to the fact that hotel companies will always struggle with in-house innovation. Why?

It’s actually related to the pedigree of the leadership and culture. Many of the VPs and senior directors have risen from front-desk to back office. They were born into a culture of always serving the customer. Always saying “yes”. As these executives become stakeholders to internal initiatives, they will not take kindly to a product or innovation manager pushing back to validate their ideas through some structured frameworks (such as Design Thinking). As an innovation team, we fortunately had the C-level support (until innovation became a bad word…more on this later) and we literally “failed” 70 out of 75 ideas presented to us from various executives.  At times, it felt like our team’s whole purpose was to build cases for saying “no”. But in this environment, we had very little time to perform real, customer-facing research.

There was another problem – access to guests for research. Hotels are extremely protective of guests, and there were policies to prevent us from arbitrarily contacting guests. Instead, the company had a pool of volunteers for surveys – not exactly a unbiased segment. Instead, we had to call upon friends and family who had stayed at a certain property- not exactly an unbiased segment.

Third is the culture of “perfecting the basics”. Our innovation team was a casualty of this after the online booking system suffered a number of failures. Imagine being a hotel owner who purchased a franchise, and you come in one day to discover you have no new reservations because of a technical glitch. The last thing you want to see is a press release about an innovative “new arrival experience”…without reservations, there are no arrivals.  But even beyond the technical basics, hotels strive to perfect the brand experience and provide a consistent product across all properties. There’s not a huge emphasis on the nuances and “extras” that can be offered unless it’s going to have a major increase in sales and satisfaction surveys. Many times, these softer items are rolled in as a part of a “brand standard” – the document that tells a franchisee how the property needs to be run. Getting these into a standard is a long process – something that takes longer than the tenure of a typical forward-thinking brand manager.

Finally, there’s the culture of consensus. This may be specific to my experience, but from what I’ve seen, the hospitality industry is very conservative. My theory is that it’s a cultural bias towards “if it’s not broke, don’t fix it” mixed with a drive towards invisible, incremental innovation rather than bold breakthroughs.

This is not to bash on hospitality – as former business traveler with a personal agenda, I still fantasize about an opportunity to lead an innovation team with proper executive air cover.

HEARTS & STARS

Three years ago, I awoke to the sound of rain and abnormally strong winds. As if by clairvoyance, my awakening was followed by a loud, creaky pop, followed by whoosh-crunch-thud. I knew exactly what happened. I got up, walked to the window to see – in the middle of our driveway was thirteen by one foot tree branch that had fallen from the highest point of an eighty-five foot tree. It hit my Jeep Cherokee like a giant lawn dart, passing through the front windshield, and crushing the dashboard with such force, that the center console around the gearshift had exploded. My beloved car was totaled.

Faced with the prospect of buying a new car, I thought about my impending move to the Bay Area – long commutes, outdoor sports, and excessive fuel costs. I developed a checklist of attributes I wanted – a hatchback, roof rack, easy access, good fuel economy, and a host of creature comforts. Out of this exercise, a few cars emerged but I settled on the VW TDi which I bought the next day.

A few months into owning the car, a friend asked me if I liked it. Without hesitation, I told him how it was “everything I was looking for” – “great on the highway”, “great mpg”, and “great for hauling my bikes”. If I were writing a product review, I would have given it 5 stars. But with every glowing review, I kept trying to reconcile the fact that I generally didn’t feel like it “fit” me.  A few weeks into this quandary, a situation led me to drive a friend’s old, ugly, gas-guzzling SUV – It made me feel great.

What was going on?

I clearly made a mistake somewhere – how could I simultaneously recommend something, while not liking it? How can something that feels good to drive, also make you feel bad while driving it?  How could I get everything I (thought I) wanted, but not be happy with the choice?

Whether it was result of making an expensive blunder, or some new mindfulness ability, I experienced a visceral understanding of the complex emotional side of the product experience.

In contrast to product reviews that rank a product’s intrinsic, observable and describable qualities with “stars”, we need another language for describing the personal, emotional feelings evoked by a product – “hearts”.

h&s

Hearts & Stars

A product that makes someone “feel” good can overcome it’s functional deficiencies to an extent.

In the book Switch by Chip and Dan Heath, they used the metaphor of an elephant being ridden down a path to represent humans.  The rider is “logic”, the elephant is “emotion”, and the “path” represents external constraints. You can ask the “rider” to turn left, but if there’s a bundle of peanuts on the right, the elephant is going to turn right.

Heaths’ simple view of human emotion explains people’s contradictory choices – why people fall in love with the “wrong person”, why people follow political parties that are against their best interests, why people act illogical in the workplace, or why seemingly good products are ignored. It’s all driven from emotional imprints formed in our very early years, intermixed with culture, identity and aspirations.

“Hearts”, aka resonation is not easily predicted.  At InterContinental Hotel Group, I was managing a research project with the goal of personalizing the front-desk experience in hotels. It seemed easy at first – harvest social media and in-hotel history for clues about biases, then address these biases with custom-tailored offers.

The fallacy with this approach is that a person’s “bias” (or psychographic segment, MBTI, etc.) is secondary to the person’s current “need state” – which is harder to derive from public data sources and transactional histories.

A less technical approach comes from DoubleTree, who greets guests with warm cookies. On a cognitive “stars” level, it’s a “freebie” or a “welcome gift”.  But through a “hearts” lens, it could be a cessation of hunger, a primitive symbol of welcome to our “tribe”, or a reminder of “mom’s nurturing”.  In any case, they are triggering a momentary boost of the brain’s feel-good chemicals at the guest’s first touchpoint.

While focus groups, competitive matrices, and trends can inform the  “stars” of a product, designing for “hearts” requires a much more authentic, human-centered approach that considers the emotional states of the person as they experience the product.  I’ll cover this in a follow-up post.