Hotel management company eliminates manual data entry, automates integrations, and streamlines reporting in addition to reducing costs
Providence solutions used:
- Staff augmentation
- Vendor selection
- HCM Consulting
- HCM Implementation
- Integration and Testing
Executive Summary
Providence Technology Solutions helped a large hotel management company consolidate six human capital management systems from three vendors into two systems from two vendors. Sage Hospitality Group improved its operations and reduced its per-employee per-month spend by 32% in doing so.
Though Sage Hospitality expected the process of migrating systems to be simple, it was not. So, it evaluated many possible partners and eventually chose Providence.
Sage Hospitality was impressed by Providence’s transparency, culture, and ability to understand the company’s requirements. Throughout the project, Providence diagnosed Sage Hospitality’s current situation and affirmed its goals and objectives for a new solution. Providence ultimately delivered the results Sage Hospitality expected by selecting the right vendors and supporting the client during the implementation of its new HCM systems.
Client
Sage Hospitality Group is a hotel management company that operates dozens of properties nationwide. It manages interesting hotels covering independent brands, luxury hotels, and soft-branded Marriott International, Hilton Hotels, and Hyatt Hotels properties, that are creative in nature and inspired by the cities in which they reside. The company has about 6,000 employees.
Challenges and Objectives
Sage Hospitality identified six objectives through Providence’s critical-success factors (CSFs) workshop and development process. Providence presented the six CSFs to a Sage Hospitality working group before taking it to the company’s management and eventually its board of directors for approval. The following CSFs became the project’s objectives.
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Ease of use
Sage Hospitality manages hotels on behalf of investors. When investors buy new properties, they often leave the existing HCM technology in place so that the hotel’s employees do not have to learn new systems. If the company were to ask a hotel’s team to switch systems, the new HCM technology would have to be easier to use to prevent complaints from employees. Hotel employees could not take time from servicing guests to adjust. Property users would need to see that it would be easier to do the same tasks in the new system. Thus, Sage Hospitality wanted its new HCM technology to be simpler than what they had.
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Cost
Sage Hospitality had been with its existing vendor for 18 years and was spending $1.5 million annually. It wanted to cut that spending by one-third to get down to $1 million a year.
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Integration
Many of Sage Hospitality’s properties used Aloha for their point-of-sale (POS) systems. So HCM systems with Aloha connectivity would be prioritized or vendors would be asked to co-fund development. Integrating the new HCM technology with Aloha and other POS systems would be essential for improving data flow. Interconnectivity would also create savings by reducing labor costs for entering data manually. Sage Hospitality also used Okta, a single sign-on platform for identity management. It wanted integration for that as well.
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Time and scheduling
Labor was the biggest and most controllable cost for Sage Hospitality. It wanted to ensure that it always had properly trained and certified employees in place at all of its properties. Top-flight associate-facing interfaces with complex scheduling and labor allocation capabilities were must-haves. Predictive scheduling compliance would be a dealbreaker. Though it was only required in Oregon at the time, predictive scheduling was poised to become more common nationwide. That has indeed been the case as more states have mandated that employers fix an employee’s schedule weeks in advance or pay a premium for changing the employee’s hours within the specified window. More states may implement predictive scheduling laws in the future.
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Brand management
Sage Hospitality manages many hotel brands and properties—and each markets itself differently. They all attract employees and customers in their own way. The company wanted to connect the properties via a common HCM system that they could each brand as their own. The ability to tailor the system at the property level would be key.
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Complete payroll
One vendor would cover all payroll aspects, like deductions, tax filings, and wage attachments. It would need to work for union and non-union employees as well. There was no desire to split payroll functionality across multiple vendors.
Sage Hospitality hired Providence to help find vendors that would meet at least the top five objectives. Providence would also assist Sage Hospitality with HCM implementation.
How Providence Helped
Vendor Selection
Providence began working with Sage Hospitality in December 2018. After documenting the client’s requirements in January 2019, the project team solicited requests for proposals the next month. Providence then helped Sage Hospitality review vendors according to the project’s six objectives. Over the next couple of months, Providence would assist Sage Hospitality by driving vendors to “show” how they could help versus just “tell” and by presenting proposals to executive leadership. Providence also helped recommend the final vendors, conduct due diligence and reference checking, and complete vendor negotiations and legal contracts. Though the client had wanted to get to one vendor, Providence found that going with a separate vendor for the talent acquisition module would make Sage Hospitality properties more effective recruiters. The final decision came down to two pairs of vendors. In the end, Sage Hospitality chose Ultimate Software (now known as UKG) and iCIMS.
Sage Hospitality chose UKG to provide the following HCM systems:
- Payroll
- HR/Benefits
- Time and Scheduling; and
- Onboarding.
The client would integrate UKG’s systems with talent acquisition and talent management solutions from iCIMS. The net result would be a migration from six systems and three vendors to two vendors and two systems. The integration between the UKG and iCIMS systems would make the migration easier.
HCM Implementation
In June 2019, Providence held an implementation “boot camp” for Sage Hospitality employees that focused on data quality and preparation. Then Providence began implementation.
Providence’s UKG Software Practice supported Sage Hospitality’s HCM implementation by:
- Addressing implementation questions and issues;
- Supporting implementation through staff augmentation; and
- Resolving the fears and concerns of internal stakeholders.
Providence added two full-time employees to Sage Hospitality’s team for the duration of the implementation. The additional staff helped Sage Hospitality bear the burden of the implementation better.
Data quality posed one of the biggest challenges for the implementation. But the combination of Providence’s familiarity with Sage Hospitality’s existing systems and its expertise in UKG smoothed the data migration process. The client configured UKG so that the company could generate the reports that it would want later, like the ability to view information by property location, for example.
Providence also ensured that the new HCM systems would support Sage Hospitality’s workflows, like for onboarding new hires. As a growing company, Sage Hospitality would need to be able to absorb new properties with different workflows. Anticipating and addressing deviations ahead of time would allow Sage Hospitality to avoid problems with acquisitions later, said Matthew Kaiser, senior vice president for strategic advisory for Providence, who was one of the project team’s leaders.
The first Sage Hospitality properties to go live with their HCM systems did so in April 2020, a month after the client notified its existing vendors that it intended to terminate service. All Sage Hospitality properties were live on the new solution by July 2020 and contracts with existing vendors were terminated.
Results
Sage Hospitality’s goals for the project centered on increasing efficiency and saving money. It achieved both.
On the savings side, the client reduced its HCM spend per employee per month (PEPM) by 32%, lowering it from $26.03 to $17.82. Sage Hospitality was able to calculate the savings precisely because it had tracked its expenses accurately over the years, including through upgrades and enhancements that had added to the base costs from when it had installed its existing system. The savings included re-allocating three FTEs with an average salary of $75,000 through the elimination of manual entry of data, automated integrations, and ease of reporting.
In addition to the savings, Sage Hospitality enhanced its scheduling abilities, which allowed it to optimize and highlight overtime, for example. With better tools and employee engagement, it could grow effortlessly.
“When they said they wanted to upgrade their technology but also reduce cost by one-third, we thought it would be a hard goal but we were able to do it,” Kaiser said.
Sage Hospitality welcomed the improvements and savings.
Learn how you can reduce costs and improve performance with HCM Consulting services from Providence Technology Solutions. Contact us today to discuss your HCM technology needs online, by email at info@theptsteam.com, or by calling 904.719.8264.
