Episode 2: Ramon meets with Michael Kuenne to discuss the tremendous changes and challenges in the hospitality industry and how winning brands are leveraging new technologies, data, and feedback to offer the best possible customer and employee experiences.
Michael is Senior Vice President and Chief Customer Experience Officer of Extended Stay America. With over 650 hotels and approximately 70,000 rooms, Extended Stay America is the largest integrated hotel owner/operator in North America and the leading brand in the mid-priced extended-stay segment.
Episode 2: Ramon meets with Michael Kuenne to discuss the tremendous changes and challenges in the hospitality industry and how winning brands are leveraging new technologies, data, and feedback to offer the best possible customer and employee experiences.
Michael is Senior Vice President and Chief Customer Experience Officer of Extended Stay America. With over 650 hotels and approximately 70,000 rooms, Extended Stay America is the largest integrated hotel owner/operator in North America and the leading brand in the mid-priced extended-stay segment.
Ramon Icasiano 0:06
Hello, I'm Ramona Icasiano, Chief Customer Officer at Pathlight. And today on our CXperts podcast, I'm very excited to have our next guest, Michael Kuenne. You know, just to give you some background on his skills and experience, Mike, you started at Morgan Stanley as an advisor, analyst, and then really started getting your consulting chops down in PwC, Price Waterhouse. And then I see here that you spent some really amazing time getting more experience around technology as a CRM Analyst, Technology and Service Ops Director, and a VP of Technology at Wells. And then which warms my heart, I see that you spent some time as a board member for a nonprofit CFY in Atlanta, which helps low-income communities together, working with families and teachers to harness the power of digital learning. Well, that's great. And then senior manager, again, more technology at The North Highland Company, and really the last eight-plus years, Director of Enterprise Apps, Procurement and Technology Services, Operational Excellence, VP, and now Senior Vice President, Chief Customer Experience Officer at Extended Stay America.
So welcome. You know, as I was reading your background, technology obviously bubbles up and the fact that you're in the hospitality industry is really very timely and interesting for this conversation. So, welcome to the podcast. And let's just start off by saying, what's what's top of mind for you right now? I mean, there's no kind of agenda here. Just really, you know, our listeners are practitioners, just like you and I, and anything that you might want to help them think through would be really great to hear.
Mike Kuenne 2:12
Thanks for the introduction and thanks for having me, I appreciate it. You know, it's funny, when you hear someone go through your background. And you've brought up technology. It's been a while since I've been in solely a technology role, but it's been an undercurrent, or a piece of what I've been doing for a while, especially, most recently, as you talk about, you know, CX.
I think the thing that I'm most passionate right now or evangelizing the most right now is you how to use technology or process or whatever it might be for the CX, to meet the customer, or guests or whatever they where they want to be met. And you know, that's important, that matters. When you talk about technology, as practitioners, I think we're used to there being a lot of technology solutions always being thrown at us, right, or there's always a technology solution or a vendor or partner. And that's not to say that those aren't great. They might be fantastic. But I think it's really important to make sure you're aligning what that business need is or that customer service need is and tie it to the right technology. Because if you don't and you're not careful, you can actually end up in a worse place than where you started. If you don't have a strategy or sort of a roadmap to get to where you need to go.
An example I can get, I'll start off with my kids. Whenever I have to deliver news to my kids, if I have good news and bad news, obviously, you want to deliver the bad news first, then the good news. I'll start off with an example of where you have to maybe be careful of technology driving process, right versus the technology driving strategy versus the other way around.
Here’s a generic example, not ESA or any specific company. Any of us who travel or travel frequently, you're familiar that there are lots of different ways to interact with a hotel or with an airline, etc.. So we'll use the hotel example. So within a lot of hotel company apps, or even within a website, there's an opportunity where you can chat or communicate with the hotel. That might be the hotel’s enterprise general customer service, or could also be just that specific hotel’s front desk.
So imagine you've been traveling, you get back to your room, and you need towels. You need something, right? So you're like, “This is great, I'll go use that app.” And I'll go to, hey, I need towels and I’m in this room, you know, whatever the request may be. And then there's silence. You don't get a response. You don't get anything. And the challenges because of some of what's going on, actually in hospitality right now with staffing issues, the staffing shortages, etc? So you need somebody on the other end of that technology, to be able to have that better experience. A technology that might have been put in place to maybe remove friction, where they wouldn't have had to take that phone call to call out to the front desk, now actually delivered a worse guest experience, because they didn't get a response. So that's just one example where you have to be really careful of aligning that whole process and the environment with technology that you might select.
Ramon Icasiano 6:17
Yeah, that's a great example. I think there is pressure as a CX operator, obviously, to meet service levels, right? Anytime you look at your volume, you look at your staffing. And do you think kind of the pressure that's occurring right now with the shortage of staff, you know, on the frontlines, there's more pressure to kind of use automated technologies with the hope that it reduces overall volume, but you know, really like your example. You know, someone might say, hey, there's a containment, or our deflection rates are improving, but really what's happening, there might be a downstream cost to it.
And so I know one of the things that I've tried to mantra as well, with teams is when you implement something, try not to do any harm, meaning like, not only looking at containment, but what's the downstream impact to the customer friction, retention usage, and be very close to your app ratings. So like going specifically to the hospitality industry and your peers there. Are there additional strategies or takeaways that might help them think about finding that kind of balance? It's a hard time. I mean, you don't have the staff, but you've got the issues coming in? You know, what's your thought there?
Mike Kuenne 7:49
Yeah, it's a great question. And it's a great point as well. You started your point with talking about, hey, is this being done because of the shortage of staff, and are we looking to technology? And without a doubt, yes. So if you go pre-pandemic, there is, I think, a focus on that for some cost reduction, and that will always be there. You can call it process efficiency, but it was it to be more efficient. I think it's still the same way now. But it's more of maybe a little bit more dire, especially in some circumstances where you just don't have someone to take that request. So in some cases, that automation is great, right? Because if you look at it from a IVR technology perspective, if I can answer someone's question without them having to talk to a person that makes them happy. It makes the other customers happy as well, because they're not waiting in a queue to get a question answered, in driving up someone else's wait time. So there's a lot of really good applications for that. It's just again, you have to be careful about making sure that you don't bring someone down a path that ends up getting them a little bit more frustrated.
Ramon Icasiano 9:14
It's essentially finding the balance between how you mix, you know, the human side, the analog versus the digital, and possibly as a corollary comment or question is, does that change what you want to measure perhaps, or even kind of the culture that you're trying to achieve, post COVID?
Mike Kuenne 9:37
Yeah, so great point about culture. I'm glad that you hit on that. I do think that matters. The way that I try to think about it is how do we use technology or process or operational excellence to make that associate or employee, more efficient, not necessarily replace that employee. Now, in some cases, that might be the case. But freeing up that associate, to focus on things that are more value add toward the guests or more value add toward the operations. So for example, I'll bring it back to hospitality. Again, if there's something that can be quickly answered for a guest, maybe it's the hours of the gym, or restaurants nearby, those types of things, that they can get that more quickly. That would be a great use of technology, because the customer gets what they want. They can do it whenever they want to do it. They can say it, but sometimes you multitask, they can do that on a mobile app, or they're on a conference call, right? Where they're not able to necessarily do that if they have to call down to the front desk. That's the opportunity. The other thing that does is that now frees up using the hotel example that Front desk agent to be providing a more face-to-face interaction where that's necessary.
Now speaking, with the Extended Stay Brands, now we talk about technology, we might use technology a little bit more, or a little bit differently, than some other hospitality brands might. A big example is checking into your room and using a online check in. That's not something that our brand offers right now. And we could certainly try to “keep up” with other brands and do that and implement that. We actually want our new guests to stop by the front desk, because our value proposition is a little bit different. Our guests stay with us a little bit longer. So we want them to see their face. We want build a relationship and explain our service offering of why our breakfast might look different to them, and why we do housekeeping every X number of days, and what our service offering is that's different than a traditional transient hotel. So if we were just trying to keep up with hospitality and offer a digital key, we would miss that customer touchpoint opportunity which is so important to our brand.
Ramon Icasiano 12:23
I love what you're saying here, I think a couple points. First point is how important context is around technology versus the face to face. I think in terms of just sharing that message to everyone listening, just sharing kind of the whys behind the technologies being implemented and what it can really do versus not, and our roles in that already would help.
And the second thing I heard, which is great, is really being clear on what problem you want technology to solve. And saying, hey, it's not going to do 18 things really well. It's gonna do five or six things and here's what it'll do amazingly well. And I think that might help all the listeners, if you've got that and sharing that kind of shortlist with the frontline teams, that they feel more comfortable and directing folks to those types of narrower functionality, right. So they feel like, okay, I now this technology is helping me versus wondering. Because we've all felt like, I'm not going to recommend or have someone go through that chatbot because I don't have a full understanding of the context or the confidence in what it's doing. Yeah, great points there.
Mike Kuenne 13:46
Absolutely. Yeah. And I think it's equally true for technology, or, you know, even process change. I mean, really, what we're talking about is change management. And sometimes as practitioners or implementers I know I've done it, we forget how important that change management is. Because if people don't understand the why, they're not going to necessarily be bought in. When we implemented our quality program, we spent just as much time around training and education and helping with self-assessments and really having all of our hotels understand the why we were doing it, not just that their score is going to go into a CX scorecard at the end of the day. The outcome is understanding why we're doing that, and why it matters to them, and why it's going to impact the revenue at their hotel, and why if they do these things, it's going to help them get some higher rated business and might drive up social media scores which then can drive up rate, which then drives profitability, which then you know, for them might drive their bonus right? So all those things, asking those whys, connecting all those dots. I think it's critically important.
Ramon Icasiano 15:02
Yeah, that's true. And I empathize with all the operators in the hospitality space. I think about frontline teams. Okay, you've got kind of the inbound reservations, customer service, right? But I think we also discount that everyone working in the building, keeping that supply chain, your rooms ready and available, and clean, and that just might even magnify my thinking around what really frontline means in terms of the culture, and the analytics, and the metrics. Anything that you want to share with the non-hospitality folks, or even the hospitality folks, what maybe the next couple of years might look like for this space? And if there's a couple of priorities or things that they should be thinking about transforming now, that would help them prepare for the future? I don't know, if the new norm is just going to be kind of a hybrid workforce, clean your own room kind of situation, I don’t know. What's the crystal ball saying now?
Mike Kuenne 16:18
Yeah, so we can go back in two years, we can see how accurate my crystal ball, how accurate it is. There's a few things that I'm doing that I might recommend others to do as well.
And the first is, you mentioned data Ramon, right? Don't be afraid to look at data differently. You know, maybe even blow up what your current scorecard is or what your current thinking is. And take a look at the reports that you have the data that report and ask why you're doing it. And see what insights you're getting from it, because while data is great. information or insights, are what matter, right? So make sure you're getting your data or to make sure you're getting your information, and your insights, and what are you doing with it? I think COVID taught me that better than anything else, as we were into it, it didn't really matter necessarily what my NPS score was, maybe that was a good barometer. But we completely shifted over to our text analytics. And we're focusing on our text analytics daily, where we used to look at that we used to look at that monthly. But we looked at it daily, because that's what was telling us what was going on in our hotels from the guest side. We combine that with the good conversations that we had going on with our employees and our associates. And that gave us a good perspective over almost 700 hotels, what's going on. That would be the first thing. Don't be afraid to look at data differently.
And then the other thing, you said how things might be different over the next couple of years. This is cliche, and it's probably been said a lot of different times, in different ways. Sometimes it's easy to just do things the same way because especially when they're working. And I think the bravest people, or the most successful people, even when things are working well, don't be afraid to ask what's next. And it's okay to fail, fail, fail fast, learn, revise, go do next. But those are the I think the companies that perform the best. And those are the types of people that I like to associate myself with and I learn more from them, that they're doing things differently. They're trying something unique. They're thinking about something in a way that somebody else hasn't thought about it before. And you might think well, why are you doing that you're successful, you know, you're the leader in your industry, whether it's restaurants or hotels or retail or whatever. But I think the innovators and the ones who aren't afraid to say what's next and let's try something a little bit different. Those are the exciting people to be around. Those are the exciting companies to work for. So for your listeners here, you know you have that opportunity to be that person or to you know, to make that your company.
Ramon Icasiano 19:43
I love that. And you know what I hear in all of that is with the new norm we're just gonna have to kind of try to get out of our own way sometimes. Even though you can hang your hat on success. Things are changing so quickly. I love your point around trend data is important. But it's really the twitchiness, right? And your comments and the kind of what's happening right now, what's the issue of the day? What's the theme of today? And that it's really going from, you know, just visually an albatross flies millions or hundreds of miles to catch one huge fish right? Now, where maybe we have to put on our hummingbird hats, right? And we're flying around, zipping around, just to try to get a little bit of nectar, right. And I'm not saying either one is correct. But we're going to have to maybe possibly add some new skills. What, like when you're interacting with your leadership team, and this might help our audience to, how do you make that change safe for them? I mean, I hear fail fast. But you know, companies, well you failed too much…right? And so what's the thinking around giving people kind of that psychological safety and being able to kind of take those chances, look at different types of insights, and act on those to help you adjust to the new norm.
Mike Kuenne 21:12
Yeah, I think it's a great question. The same answer of what you tell your customers, you need to explain why it's important, right? I mean, you don't just want to go try something just for the sake of trying something with no data, or no measurement success criteria, you need to have all that. But you know, understanding why. Communication, everybody always says communication is so important, but it really is. And communication is two ways. So not just sharing, like so you know, within our leadership team, or any leadership team that people might be part of, it's important, not just to share why you might think something is important, or why you're going to go down a certain path, or recommending it. But likewise, very sincerely encouraging feedback from that team of what do they think? How does it impact them? How can you make it more comfortable for them? How can you make them understand, because communication has to be two ways.
I think it can be very dangerous, that you can get a lot of nodding heads, especially in this virtual world that we're in right now. Or, you know, we take silence for acceptance. And I think you need to be careful about that. That doesn't necessarily mean people are bought in. And you won't always get 100% alignment. Even within our CX strategy that we have built that at Extended Stay, I would be lying to say if we all always held hands and said, “Yes, this is going to be great. And it's perfectly we're gonna hit all these targets.” Right? That's a challenge, right? But that's what good leadership teams should do. Right? There should be some friction there, there should be some tension. If there's no healthy friction or healthy tension, then that leadership team isn't doing their job.
And it's the same way you communicate with your customers, right? You brought up the point earlier in the podcast of how do you have success with your customers, especially in these times, cleaning your own rooms or breakfast changing? I think it's being transparent. I think COVID taught us and especially taught me, people are very understanding, they're very reasonable. But you really need to set expectations correctly. So we actually spent more time upfront trying to align expectations, even if it was disappointing, that breakfast might not be offered, or fitness center might be closed, or a laundry facility might have reduced capacity. Those were tough messages or difficult messages to deliver. But a guest appreciated it if we delivered it earlier in their guest journey, prior to check-in versus communicating that after we handed them their room key and said, “Oh yeah, by the way, our gym is closed, right?” Same situation. But when you communicate it at a different time, and set the expectation, it completely changes that guest experience.
Ramon Icasiano 24:33
Yeah, I love this. And I'm really starting to hear one thing come up for me is how employee experience and guest experience really is the same approach. Right? In terms of just communicating, setting expectations, looking at what kind of data to look at and act on it. It's not so much that long-term trends that are important, but those are but you know, kind of the real-time feedback that you're seeing. What, just to finish this off here. Are there any other kinds of things that people out on the field can think about in terms of just getting through this. I mean, it's, and I've said this over and over, but, you know, expert customer expectations are through the roof. They're all coming in really upset, really kind of hot. Employees are checking there, they're kind of their own health kind of meters and trying to find meaningful work. And so here we are, as leaders in the middle, trying to satisfy both and plus the business as well has needs. What are just some final advice or points you want to share with the team here?
Mike Kuenne 26:00
Yeah, thanks for asking that. I'm a little old-fashioned sometimes with some of this. So I'm going to give you an answer that isn't super, whiz-bang, technical. But at the end of the day, we all as human beings have a need to feel accepted, feel important and, and feel heard. And whatever strategy that you're designing around your customer experience, your employee experience, you said it so well, Ramon, about how they're so tightly linked, listen to your employees, listen to your associates, and build strategies and technologies that support and enable them to do their jobs better. Allow them to spend time doing those value add activities, and, you know, you bring up the example of customer expectations are as high as they've ever been. I would agree with you. But I'd also say, people tend to be more understanding if they're communicated with appropriately.
So if I have that opportunity to speak to an upset guest, and believe me, it's not always going to work. But if you're able to do that, and look them in the eye, and you know, have a conversation, that's a better way to do that, then saying “I can't talk to you right now, you need to go call, go call our guest relations, phone number”. And, of course, that's not something that we would ever want to do. And sometimes that's necessary based on the staffing that you have, but just remembering, we're all driving toward the same thing. And many of us who are CX professionals, we experienced that same thing in reverse every single day, whether it's going to a restaurant, staying in a hotel, flying an airline, or you're shopping at the supermarket. So you know, look for ways in your personal life, that you have interactions have good experiences that you have it those establishments and experiences that aren't as good. Take those back, take those as learning, always be learning and take those back as ways to learn how you might be able to use that as an opportunity to improve your own organization. So there's a lot of opportunity out there.
Ramon Icasiano 28:30
Wow, that's a great way to close. You know, just want to, for the audience, just what I heard was look, you know, embrace what's in front of us. Know that it's a challenge. Be honest with it, with your team, with your customers. And as Michael has displayed here, just a lot of humility, empathy towards the customer experience and employee experience. So with that, Mike, thank you very much. We're gonna include your LinkedIn profile as well for anyone to reach out and as well as mine. And to our listeners. Thank you again for joining us on our most recent CXperts podcast with that. Thank you.
Mike Kuenne 29:14
Great, thanks for having me. I enjoyed it.