Fine-tuning your staffing to match guest demand perfectly takes time and effort — but it makes all the difference for customer experiences and cost-efficient hotel operations.
Each hotel section, from the kitchen to housekeeping to the front desk, has to work harmoniously and respond dynamically to the ebb and flow of guest occupancy. It's a delicate dance that, when performed correctly, makes running your hotel business seem effortless.
Understanding the Basics of Labour Demand Forecasting in Hotels
In the context of hotels, labour demand forecasting is about analysing your hotel's historical business data to forecast your hotel's future needs for staff, optimise staffing resources and manage labour costs.
According to Deputy's Director of Customer Success, EMEA Steve Woods, "Demand planning or labour forecasting is ensuring you've got the right labour at hand during peak and low periods of the day."
Labour forecasting, at its core, is about making informed predictions. "Effective labour forecasting will bring together different forecast data, such as sales data, foot traffic, room bookings, holidays, and local events, to help you forecast the total number of room bookings your business might have per hour per day in the future," says Woods.
This foresight allows your hotel to align staff levels accordingly, ensuring that you're always prepared to offer the best possible guest service without unnecessary expenditure on labour.
The Importance of Accurate Forecasting
Accurate forecasting is the cornerstone of effective demand planning. Getting this right is the difference between a smoothly run hotel and one constantly playing catch-up. It's one of your key competitive advantages.
It's important first to generate accurate forecasts for core demand drivers (e.g. bookings data) and then consider variabilities such as seasonality, weather, holidays, or local events.
This information helps you anticipate busy periods, plan for them, and avoid overstaffing during quieter times. Getting labour forecasting right will help you deliver a better guest experience while controlling labour costs.
Overcoming Forecasting Challenges
Accuracy in labour forecasting is the first hurdle hotels face. Hotels, by nature, deal with a high level of unpredictability. Seasonal fluctuations, last-minute bookings, poor economic conditions, new openings of competitors, and unforeseen events like natural disasters or political instability can all throw a wrench in the most well-thought-out plans and hopes for a fully booked hotel.
Getting a high enough level of accuracy around the forecasting process to have a certain level of predictability is vital and possible.
Only accurate data can lead to good forecasts. Investing in robust data collection systems, integrating data from various sources (reservations, POS, etc) and regularly validating and updating that data can help you create an optimal staffing forecast.
The next stage will map the forecast created to your hotel's labour requirements and realities. How do you determine those realities? Here are a set of questions that can help with that:
Do you have a flexible staffing model that you can adjust based on sudden changes to this forecast? Develop flexible scheduling systems to adjust staff levels in response to real-time demand. Cross-train staff to handle different roles during busy and lean periods will also help you build a flexible staffing model.
Do you struggle with high employee turnover? If you're struggling with high employee turnover, focus on employee satisfaction, career growth and work-life balance. Conduct exit interviews to understand reasons for turnover and address them swiftly.
Strategies for Effective Labour Allocation
Allocating labour efficiently is the next step to master. Simply identifying the number of staff you have on each shift is just the beginning - you'll also need to decide on different shift types, shift durations and shift start and end times.
Workforce management tools like Deputy will help you create flexible yet precise staffing models that match your demand forecasts — and, in doing so, help you optimise rota coverage and reduce labour costs. They can also help you scale your shift schedule to meet changing demand and minimise administrative time.
"Deputy helps clients better understand the types of shift lengths required and when shifts should start. We combine this with forecasts on required labour levels to create an optimised shift pattern. The final stage automatically allocates the right employee to the right shift. To do this, we look at their qualifications, availability, whether or not they're on leave, and any other custom requirements that might influence the shifts you want your employees to work," says Steve Woods, Deputy's Director of Customer Success, EMEA.
Using Technology for Labour Forecasting
Embracing technology will optimise the accuracy of your labour forecasting. Digital tools and software offer powerful insights and forecasting capabilities previously beyond the modern hotel's reach.
Predictive workforce management platforms like Deputy and Predelo can analyse vast amounts of data, identify trends, and even predict future demand accurately. This technological leverage will help transform how you schedule your staff, manage resources and serve your guests. Predictive workforce management technology takes the guesswork out of forecasting so you can make data-driven decisions that benefit both your guests and your bottom line.
The Path Forward
The importance of your hotel mastering labour forecasting can't be overstated. At the heart of every successful hotel operation is a commitment to understanding and meeting the needs of your guests through effective labour forecasting.
Having the right solutions that can marry changing levels of demand with labour requirements and availability is key. Labour is your business's highest cost. Without clear visibility on what's driving that cost, planning for changing demand levels and the increasingly difficult task of sustaining and scaling your hotel's growth becomes very difficult. Find out more in our guide, Ditch Dinosaur Scheduling: Why Digital Tools Give Your Hotel a Competitive Edge
If you're interested in efficiently reducing labour costs and implementing predictive workforce management and flexible shift scheduling, give us a shout.
