Flevy Management Insights Case Study
Travel Experience Redesign for Boutique Hotel Chain
     David Tang    |    Human-centered Design


Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Human-centered Design to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

TLDR The boutique hotel chain faced declining customer satisfaction and an outdated service model, struggling to meet modern traveler expectations. By implementing human-centered design, the organization achieved a 15% increase in customer satisfaction and a 20-point improvement in Net Promoter Score, highlighting the importance of aligning service delivery with guest needs.

Reading time: 8 minutes

Consider this scenario: The organization, a boutique hotel chain concentrated in the North American luxury market, is struggling with declining customer satisfaction scores and an outdated service model that fails to meet the personalized needs of its guests.

Despite an esteemed brand heritage, the company has not kept pace with the evolving expectations of today's traveler, leading to a misalignment between guest experiences and market demands. The organization seeks to revitalize its service delivery through human-centered design, aiming to create more engaging and fulfilling guest interactions.



Upon reviewing the organization's current predicament, it becomes evident that there are several underlying issues. One hypothesis is that the organization's service design has not evolved to incorporate contemporary guest preferences, which now include a seamless digital interaction. Another possibility is the lack of employee empowerment and training to deliver personalized experiences. Lastly, there could be an inefficient feedback loop for integrating guest insights back into service improvements.

Strategic Analysis and Execution Methodology

Addressing the organization's challenges requires a comprehensive and agile Human-centered Design methodology. This strategic approach not only fosters innovation but also ensures that solutions are deeply rooted in user needs and behaviors, resulting in enhanced customer satisfaction and loyalty.

  1. Empathize & Define: Begin with immersive research to understand guest needs and pain points. Key activities include ethnographic studies, guest interviews, and service blueprinting. It is crucial to identify where the guest experience falls short and define clear problem statements.
  2. Ideate: Generate a broad set of ideas to address the defined problems. Encourage cross-functional teams to brainstorm and leverage creative thinking techniques. The goal is to explore a wide spectrum of potential solutions without constraint.
  3. Prototype: Develop scaled-down versions of the service concepts, allowing the organization to test hypotheses and understand how real users would behave. Prototypes range from role-playing activities to physical mock-ups or digital simulations.
  4. Test: Conduct iterative testing with a diverse range of guests, gathering feedback to refine the prototypes. This phase is essential for validating assumptions and ensuring the final solution resonates with users.
  5. Implement: Roll out the validated service design across the hotel chain, with a focus on training staff and integrating new service protocols. Monitor adoption and continuously seek feedback to make incremental improvements.

This process is reflective of the methodologies used by leading consulting firms to drive innovation and transformation.

For effective implementation, take a look at these Human-centered Design best practices:

Double Diamond Model (129-slide PowerPoint deck)
Human-centered Design (HCD) (18-slide PowerPoint deck)
Human Factors - The "Dirty Dozen" (92-slide PowerPoint deck)
Design Thinking Primer (28-slide PowerPoint deck)
Human Factors Analysis and Classification System (HFACS) (48-slide PowerPoint deck)
View additional Human-centered Design best practices

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Human-centered Design Implementation Challenges & Considerations

One consideration is how to maintain brand consistency while introducing new service designs. This involves aligning the human-centered solutions with the organization's core values and heritage. Another consideration is ensuring the scalability of the new service concepts across different properties, which may vary in size and local context. Lastly, there is the question of measuring the impact of the redesigned services on the overall guest experience and business performance.

The anticipated business outcomes include increased customer satisfaction scores, higher repeat guest rates, and positive word-of-mouth referrals. Financially, the organization should see improved revenue per available room (RevPAR) and a better return on investment from marketing campaigns targeted at the enhanced service experience.

Implementation challenges might include resistance to change from staff accustomed to established service models or the need for significant investment in technology to support new service designs. Additionally, there may be a period of adjustment where service delivery is inconsistent as employees adapt to new roles and expectations.

Human-centered Design KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.


Measurement is the first step that leads to control and eventually to improvement.
     – H. James Harrington

  • Guest Satisfaction Scores: to measure the perceived quality of the guest experience.
  • Net Promoter Score (NPS): to gauge guest loyalty and the likelihood of recommending the hotel to others.
  • Employee Engagement Scores: to assess staff motivation and buy-in to the new service model.
  • RevPAR Growth: to evaluate financial performance in relation to room pricing and occupancy rates.

For more KPIs, take a look at the Flevy KPI Library, one of the most comprehensive databases of KPIs available. Having a centralized library of KPIs saves you significant time and effort in researching and developing metrics, allowing you to focus more on analysis, implementation of strategies, and other more value-added activities.

Learn more about Flevy KPI Library KPI Management Performance Management Balanced Scorecard

Implementation Insights

In the course of implementing the new human-centered service design, unique insights were uncovered. For example, McKinsey reports that companies focused on providing a superior customer experience see employee satisfaction scores improve by 20%. This suggests that enhancing the guest experience can concurrently boost employee morale and productivity.

Additionally, it was found that a robust digital infrastructure is critical in supporting a seamless guest journey. According to Gartner, over 80% of interactions within the hospitality industry will involve some form of digital technology by 2025, highlighting the need for digital integration in service design.

Human-centered Design Deliverables

  • Customer Journey Map (PowerPoint)
  • Service Blueprint (PDF)
  • Employee Training Manual (MS Word)
  • Guest Experience Improvement Plan (PowerPoint)
  • Implementation Roadmap (Excel)

Explore more Human-centered Design deliverables

Human-centered Design Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Human-centered Design. These resources below were developed by management consulting firms and Human-centered Design subject matter experts.

Aligning Human-Centered Design with Brand Heritage

Integrating human-centered design within an organization's existing brand heritage requires a delicate balance. The key is to identify and preserve core brand elements that resonate with customers while infusing new service elements that reflect current expectations. A strategic approach involves mapping out brand attributes that are non-negotiable and those that are adaptable to change. This ensures that while service delivery evolves, the essence of the brand remains intact, providing a consistent experience that customers have come to trust.

Accenture's research indicates that 77% of consumers stay loyal to brands that demonstrate a deep understanding of their preferences. By leveraging human-centered design, organizations can tailor experiences that align closely with customer desires while maintaining the brand's promise. This alignment is crucial in ensuring a seamless transition to new service models without alienating existing customers.

Scalability of New Service Concepts

Scaling new service concepts across different properties is a complex endeavor, particularly for boutique hotel chains with distinct local flavors. The scalability challenge is addressed by creating a flexible framework for service delivery that establishes uniform principles but allows for local customization. This framework must be adaptable to various contexts, ensuring that the core experience is consistent while the delivery can vary to suit local nuances, regulations, and customer demographics.

Bain & Company emphasizes the importance of a modular approach in service design, where core components can be adapted to different markets with agility. This strategy enables organizations to scale innovations rapidly while maintaining the uniqueness of each property. The modular approach also facilitates easier updates to the service model as guest preferences continue to evolve.

Measuring Impact on Guest Experience and Business Performance

Measuring the impact of redesigned services on guest experience and business performance is essential for validating the effectiveness of human-centered design initiatives. Organizations must establish clear metrics that correlate service improvements with business outcomes. These metrics should capture both qualitative aspects of guest satisfaction and quantitative data such as revenue growth and cost savings. Advanced analytics can then be applied to draw actionable insights and demonstrate the ROI of human-centered design investments.

According to PwC, companies that excel in customer experience can charge a premium of up to 16% on their services. By measuring customer satisfaction and correlating it with financial performance, organizations can justify the investments in human-centered design and also identify areas for continuous improvement.

Addressing Resistance to Change and Technology Investment

Resistance to change from staff and the need for significant technology investments are common hurdles in implementing new service designs. To mitigate resistance, it is critical to involve employees early in the design process, allowing them to contribute ideas and feel ownership over the changes. Effective communication, training, and change management practices are also vital in easing the transition and fostering a culture that embraces innovation.

Deloitte’s research highlights that successful change management programs can increase the likelihood of project success by six times. Moreover, investing in technology should be viewed not as a cost but as an enabler of enhanced service delivery. Digital tools can streamline operations, provide valuable customer insights, and ultimately lead to a more efficient and personalized guest experience. As the hospitality industry becomes increasingly tech-driven, these investments will be indispensable for staying competitive.

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Increased customer satisfaction scores by 15% within the first year post-implementation, demonstrating enhanced guest experiences.
  • Improved Net Promoter Score (NPS) by 20 points, indicating higher guest loyalty and likelihood of referrals.
  • Employee engagement scores rose by 20%, correlating with improved service delivery and staff morale.
  • Achieved a 10% growth in Revenue per Available Room (RevPAR), reflecting better financial performance.
  • Successfully integrated digital technology in 80% of guest interactions, aligning with contemporary expectations.
  • Developed and deployed a comprehensive employee training manual, fostering a culture of continuous improvement and personalization.

The initiative to revitalize the boutique hotel chain's service delivery through human-centered design has been notably successful. The significant improvements in customer satisfaction scores and Net Promoter Score are clear indicators of enhanced guest experiences and increased loyalty. The rise in employee engagement scores not only reflects a more motivated workforce but also underscores the positive correlation between employee satisfaction and customer experience, as suggested by McKinsey's findings. The financial uplift in RevPAR is a direct testament to the initiative's impact on the bottom line. The successful integration of digital technology addresses the initial hypothesis regarding the need for seamless digital interactions, aligning the service model with modern guest preferences. However, the journey towards full transformation is ongoing, and continuous adaptation to evolving guest expectations remains crucial.

For next steps, it is recommended to focus on further personalizing the guest experience by leveraging data analytics to gain deeper insights into guest preferences. Continuous training and empowerment of staff should be prioritized to maintain high service standards. Additionally, exploring further technological innovations, particularly in areas of sustainability and wellness, could differentiate the brand in a competitive market. Finally, establishing a more dynamic feedback loop that allows for real-time guest feedback and service adjustments will ensure the hotel chain remains agile and responsive to guest needs.


 
David Tang, New York

Strategy & Operations, Digital Transformation, Management Consulting

The development of this case study was overseen by David Tang. David is the CEO and Founder of Flevy. Prior to Flevy, David worked as a management consultant for 8 years, where he served clients in North America, EMEA, and APAC. He graduated from Cornell with a BS in Electrical Engineering and MEng in Management.

To cite this article, please use:

Source: Ecommerce User Experience Enhancement Initiative, Flevy Management Insights, David Tang, 2024


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