Analysis: Lack of women in hospitality leadership roles is a business issue

Why achieving gender balance in hospitality is essential for the growth of the sector

Research shows that having women in leadership roles can boost net profit margins.
Research shows that having women in leadership roles can boost net profit margins.

Companies with more female leaders are more profitable, with statistics showing significant profit margins and improved KPIs, analysts have claimed. But that’s not all: having women in the top leadership team is directly related to increased profitability, according to a study of nearly 22,000 publicly traded companies in 91 countries.

Women in leadership is definitely a business issue asserted Maria Tullberg, general manager at Radisson Blu Hotel, Dubai Deira Creek.

“It is not a fight between men and women. On the contrary, we need each other in order to be more successful overall. [Research] clearly shows that a diverse team will increase all key performance indicators (KPIs), from sales, return on investment (ROI), and net profit, to guest and employee satisfaction,” Tullberg told Hotelier Middle East at the Women in Leadership summit at the M Gallery by Sofitel in Dubai. “The magic starts to happen once the team reaches a balance of at least 30% women in leadership positions.”

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Tullberg’s assertions are validated by statistics. The Peterson Institute for International Economics and EY analysed results from 21,980 global, publicly traded companies in 91 countries, from various industries and sectors, and discovered that having women in at least 30% of leadership positions, or the C-suite, added 6% to net profit margins.

The gender imbalance extends not just across the Middle East — there is a dearth of women in high-level positions at companies worldwide. The 2016 Fortune 500 list included just 21 companies with women at the helm, compared to 24 in 2015.

Mohamed Awadalla, CEO of Time Hotels, is set open a new hotel that aims to be 80% staffed by women. The Time Asma Hotel, which will be located in Dubai’s Al Barsha, is due to open in the fourth quarter of 2017.

Awadalla believes that the hospitality industry must do more to attract, retain, and support female professionals and their aspirations for career development.

“Currently, we are seeing equal numbers of male and female graduates leaving hospitality school, but the number of women entering the workforce is decidedly lower than that of men. This is something that has been recognised by His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, who has set a goal to increase the presence of women in the workplace,” he said.

The number of women in the Middle East and North Africa (MENA) hospitality sector may be set to increase, however. While the region has lagged behind more mature markets such as Europe in the past when it came to gender diversity, the region has evolved to recognise it as an important element in the operations of any successful organisation. Far-reaching initiatives to promote female representation in the workforce are beginning to receive backing from the private and public sectors, and this is having a positive effect on the hospitality industry throughout the Middle East.

One of the biggest hurdles women face in the hospitality industry is the perception surrounding their ability to perform in senior leadership positions, according to Nicola Hochgruber, general manager of Novotel and Ibis Abu Dhabi Gate. She believes that to change this perception, AccorHotels does more than merely counter the narrative: it is committed to concrete objectives that foster equality while respecting local laws and customs.

“In May 2015, we joined the Impact 10x10x10 initiative of the HeForShe solidarity campaign, backed by United Nations (UN) Women. Our ambition is to ensure that actions to foster gender equality are driven by both women and men, thereby changing mentalities within the hotel industry,” she said.

AccorHotels is also a signatory to the UN Women and the UN Global Compact’s Women’s Empowerment Principles (WEP). It is one of the few hotel companies actively campaigning for female empowerment worldwide across its network.

The Women at Accor Generation (WAAG) is a 10,000 member-strong global network that was launched to overcome gender stereotypes, promote gender equality, and offer support to women within the Accor group. Through WAAG, AccorHotels’ junior female managers are offered the support of a mentor, as well as being offered training, and an opportunity to share experiences. The mentor pairings offer added value for all, and include male mentors, according to WAAG.

With the growth of the hospitality sector in Saudi Arabia, the industry is becoming an increasingly popular career option among Saudi nationals. Marriott International’s president and managing director, Middle East and Africa, Alex Kyriakidis, said that interest in the hospitality sector among Saudi women is stronger than ever before.

In 2016, Marriott International launched Tahseen, an 18-month hospitality training programme in conjunction with Cornell University, to train the local population in the Middle East.

Kyriakidis explained: “When we announced Tahseen in 2016, and took it to the Saudi authorities, they said, ‘Can you make sure you reach out to us to encourage the thousands of women in the Kingdom who are jobless and would find an opportunity in your industry now, since it’s attractive?’”

“That signifies change, because three years ago, for a Saudi woman to work in hospitality was a big challenge for her family. Nowadays, we have evolved and can provide culturally sensitive job opportunities for women, generally in finance, human resources (HR), [or] marketing,” Kyriakidis said.

According to Laura Eggleton, general manager at the Holiday Inn Muscat Al Seeb, the biggest challenge preventing women from progressing to leadership positions is the idea of “being first”, whether it be as the first female manager in a hotel leadership team, or as the first female general manager (GM) appointed by a hotel operator.

“When I announced to friends that I was leaving the UK to embark on a new role in the Middle East, most people tried to convince me I was making a mistake and that this region wasn’t accommodating to women in leadership roles. Fortunately, they were all very wrong,” Eggleton told Hotelier.

Is enough being done to include women in the hospitality industry, however? Julia Miller, director, compensation and benefits, Middle East and Africa (MEA), at Hilton, believes companies should also offer “flexibility where possible, for both male and female team members”.

“At Hilton, we pride ourselves on creating a family-friendly environment, which is why we introduced a minimum of 12 weeks’ fully paid maternity leave for female team members in the Middle East and Africa earlier this year,” she said.

According to Tullberg, however, hospitality in the region is still something of a man’s world. “Most of the largest hotel chains do have programmes in place to [promote] women in leadership, and there have been some very positive achievements. For example, in Saudi Arabia, Rezidor has gone from zero female managers in 2014 to eight. Earlier this year, Rezidor appointed the first female hospitality GM in Saudi Arabia, and Accor appointed its first female GM in KSA just a couple of months later. Rezidor has also introduced an enhanced maternity leave policy, and I hope this will inspire others to do the same. 

“We still have [a long way] to go though, with no women among the top 100 most powerful leaders within hospitality in Middle East,” she noted.

One of the problems, IHG’s Eggleton added, is that it’s still a relatively new phenomenon to see women in leadership roles. 

“People are often surprised to see a female GM and, as we know, people resist change. It’s really a matter of perception. I guess people see it as too much of a change from the ‘normal’, stereotypical GM we see in this region, and don’t want to take the ‘risk’ of changing the habit of a lifetime by appointing a female business leader,” she concluded.

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