Deloitte: Sustainability a Key Driver for Hospitality in 2015

The Deloitte report says sustainability will be key for the hospitality industry.

The Deloitte report says sustainability will be key for the hospitality industry.

By Florian Kaefer

Global strategic consulting firm Deloitte has released the Hospitality 2015 report which could prove to be an eye opener for those in the hotel and hospitality industry.

The report identifies the sustainability agenda as being one of the key trends that will define success in the market place in 2015. While in the short term this will pose a challenge to the industry, positive brand images and competitive advantage resulting from serious efforts to guarantee environmental, social and economic best practice, will make early adoption worthwhile.

The report says, “Sustainability will become a defining issue for the industry in 2015 and beyond. Rising populations and increasingly scarce resources will provide a challenging business environment in which sustainability will need to be embedded within all facets of the industry, rather than regarded as a standalone issue.”

The report found that, “Sustainability is increasingly seen as a prominent factor in hospitality decision-making, but is not yet fully embedded in business thinking.”

According to Deloitte:

  • The key challenge faced by the industry in 2015 will be the adaptation of the existing asset base, which will be expensive and disruptive.
  • Regulatory, economic and stakeholder pressure will drive sustainability in the industry, creating a virtuous circle that will see social and business norms change with surprising speed.
  • 95 per cent of business travellers surveyed believe the hotel industry should be undertaking ‘green’ initiatives.
  • By 2015, the consumption of goods and services seen as environmentally irresponsible is likely to be challenged by new social norms. Luxury items that fall into this category risk being seen as increasingly unacceptable.

The new situation faced by hotel owners and managers, according to Deloitte, is that “over the past five years sustainability has risen up political, consumer and business agendas faster than any other issue.” Sustainability, the consulting firm believes, “is now an accepted dynamic in the socioeconomic and political environment of the 21st century.”

We are in the midst of a significant cultural shift. At the start of the last decade there was little consumer recognition, yet a recent survey by Deloitte found that in most countries 30 per cent of consumers now buy with sustainability in mind and a further 30 per cent are aware of the issue.

Deloitte predicts that: “By 2015, shifting consumer and voter attitudes will have continued their current trajectory, forcing governments and political parties to address the socio-economic landscape and ‘real’ market in which businesses operate. We believe that the convergence of political, consumer and business agendas around sustainability will be a major historical landmark in the development of our society.”

Growing importance of sustainability in hospitality.

“Hospitality is vulnerable to water shortages, relies heavily on built assets, consumes significant amounts of electricity and, generally speaking, is an item on which spending is discretionary. These factors ensure that hospitality will be significantly impacted by sustainability issues in the future.”

“Sustainability initiatives currently range from operational changes such as linen and towel re-use programmes, energy management projects or using green cleaners to development initiatives such as pursuing green building certifications like LEED.”

Interviews with hospitality executives confirm that sustainability is no longer considered primarily as a marketing issue and is now increasingly seen as a prominent factor in decision making, although it is yet to be fully embedded into business thinking.

“By 2015 we expect sustainability to become a business imperative, requiring companies to educate their organisation on the changing consumer and regulatory environment and to derive strategies to maximise their market position.”

How to master this challenge? A first step would be to acknowledge sustainability as a business strategy imperative, which means that CEO’s and general managers, rather than marketers or communication professionals, should be the ones in charge of steering their organisation through this transition period. Some hotel managers, such as Gary Stickland at the multi-award winning 4-Star Alto Hotel in Melbourne, Australia, have long understood that environmental consciousness and sustainability are not just a trend, but an obligation and opportunity to do good by doing better.

As well as sustainability, the report updates its 2010 predictions of seven key trends which it said were 'game changers' for the industry. You can read or download the Deloitte Hospitality 2015 report here.

Visit Sustainability-Leaders.com for more case studies, resources and business insights.

 

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