Top 6 Management Issues in the Hospitality Industry

The work that comes with hotel management is not always easy. Hotel managers are often forced to juggle a number of tasks at any given time from making sure that the books are balanced to ensuring that everything is running smoothly. In this article, we have outlined 6 management issues in the hospitality industry. 

Because the hospitality industry is one of the fastest-growing sectors in the world, it has been characterised by continued technological advancements. Also, the recent Covid pandemic has made the outlook of the hospitality industry gloomy.

Advancements in the past have done wonders to improve organisation, efficiency and customer experience. 

However, they have also brought a few major issues facing the hospitality industry. These issues have affected the way hotels and other services are operated. 

These issues create bottlenecks that impede the expected growth. A better understanding of these management issues would give the hoteliers and hospitality managers a clear edge over the competition. 

Here are the top 6 management issues in the hospitality industry:

Top 6 Management Issues in the Hospitality Industry

1. The Constantly Changing Expectations of Customers

The customer is the King in the hotel industry or hospitality industry on the whole.

The whole purpose of the industry is to keep customers happy. But the margins are now decreasing.

Keeping customers happy is not enough anymore. As a Hotel Manager, you need to find ways to delight customers now.

You would need to find a way to bridge the gap between perception and actual delight.

Image Courtesy- Zendesk

As you can see in the image above delight only happens 16% of the time. That gap between reality and perception needs to be filled.

Even the service that delighted customers last time would now be an expectation. So, delighting customers in the hospitality industry is getting more difficult with changing customer expectations.

Changing times have brought about changed demands from customers. 

Managers in the hospitality industry are facing completely different problems today than they did in the past/ This is due to the new technological advancements and varying customer behaviour. 

With the emergence of apps, for instance, consumers are now beginning to expect a level of convenience and efficiency that must be catered to.

So, taking a cue from social media and digital channels, hotel managers must act to surpass and delight their customers every time they walk in.

Image Courtesy- Pinterest

2. Continued Technological Changes and regular innovation

Today, hotel guests are more tech-savvy than ever. Dealing effectively and profitably with this savviness is one of the top management issues in the hospitality industry today. 

When they choose to stay in one hotel over the other, they expect to find free Wi-Fi, flat-screen TVs, USB ports and so on. 

Hotels and other businesses in the hospitality industry are relying heavily on technology to streamline their services. 

Keeping up with technology is one of the major issues faced by hotel managers, but when dealt with properly, it is definitely worth it.

Technology in the Hotel Industry is helping transform businesses in the current competitive era. 

Over the past couple of decades, major Innovation in the Hospitality industry has been driven by technology. 

3. Political and Security Challenges

This, again, is one of the top management issues in the hospitality industry. 

The issue of managing the macro issues dealing with the socio-political as well as economic challenges. 

The threat of terrorism today has changed how people travel and where they travel. 

Hotel managers are tasked with the duty of ensuring that proper surveillance systems are installed and maintained throughout so that guests can feel comfortable and safe. 

To deal with security challenges, hotel managers have to rely on high-tech gadgets and software, which can be expensive to acquire and maintain.

According to studies from the Journal of Hotel and Business Management, macro and micro factors account for security threats.

These range from micro issues like Data theft to macro issues like Terrorism. 

A lot of countries like Egypt, Turkey, Syria etc. have faced issues due to terrorism while political and economic issues have hurt economies like Greece, Portugal etc. in the past.

The issue is serious whether we discuss data and credit card security to life hazards and terrorist threats. Hotel Managers need to anticipate as well as study any potential threats and be prepared to minimise losses in such a situation or to prevent it altogether.

Risk Management is thus a crucial point to cover for all hospitality Managers.

Check out the infographic below to understand the various facets of risks that need to be managed. These are pretty much required and evident in the case of hospitality and tourism as well.

Events like the Covid pandemic have only stressed better risk management for hospitality organisations.

4. Skilled labour shortage, staff turnover and Irregular working hours

This is one of the major challenges in the hotel industry. Staff turnover in the hospitality industry is almost double the average across industries. 

This can be said to be the biggest management issue in the hotel industry.

In recent years, the high turnover and increasing competition have only added flame to the issue of the skilled labour shortage in the hospitality industry on the whole. 

Because customers expect a lot more nowadays, employees in the hospitality industry, in turn, are forced to deal with long and sometimes irregular working hours. 

To make sure that everything is running smoothly at all times, managers have to find new ways to manage their stress because they cannot afford to lose it or burn out.

According to a lot of research works, salary is the most important factor to consider for retaining the best staff in the hospitality industry.

Image Courtesy- Bighospitality

Another important thing for maximum staff retention in the hospitality industry is to invest in training.

Better training programmes, hospitality industry certifications, online hospitality courses and on-the-job training can help decrease issues and enhance skilled labour percentage.

However, as a hotel manager, the onus is on you to ensure that the turnover is low and that every single one of your team is taken good care of.

Compassionate leadership is one of the key attributes of managers today. Proper team management is considered one of the top Management tips for Hospitality Managers. 

5. Booking and Revenue challenges

Today, guests have several options to choose from, which has forced managers to up their marketing and advertising game. 

This has created revenue challenges whereby if managers are unable to keep up with their competitors, they risk losing loyal customers and share of the local business.

It is thus important to understand the booking ecosystem and have the best strategic partners in place.

Increasing costs and decreasing revenue come up as key management issues in the hospitality industry. 

6. Seasonality of the hospitality industry

Peak seasons in the hospitality industry tend to bring a lot of business but it also brings undue stress to the management and its staff.  

Managers are also charged with the responsibility of keeping up with the ongoing changes in booking and pricing, which can be daunting for anyone. 

Everyone is required to make the most during peak season.

While more staff, as well as resources, are required during peak season, the percentage drops heavily during the lean season making it difficult for hospitality managers to ensure profitability.

Innovation, diversification and effective management would continue to hold the key in terms of managing the issue of seasonality in the hospitality industry.

We need to understand the nature of these threats and then devise ways to counter these management issues. 

Image by eZee Absolute 

It is important to be ahead of the pack by tackling these major issues.


In this article, we have outlined a few of the top management issues in the hospitality industry.

It is important to acknowledge the issues few of which would continue to pose threats in the future.

Hoteliers and hospitality managers need to keep themselves on the edge while tackling the issues.

Plan ahead to ensure that you can outwit your competition every single time. 

Remember, “Failing to Plan is Planning to Fail”.

2 thoughts on “Top 6 Management Issues in the Hospitality Industry”

  1. As a student in the Hospitality and Tourism Industry. while I study these challenges of the industry I see that is not easy to have problems that are not under control of management such as pandemic. and others may also a big challenge such as changing new marketing trends, workers who lack knowledge. expectation of the guest that cannot be given due to the lack of ideas of those running the hotels like toxic managers. wages that are not enough for the workers and the hours spent working are too much.

    • Hi Nora. Thanks for your lovely insights. Indeed, navigating through management issues in the hospitality industry, like those you mentioned, can be quite the balancing act. From adapting to unforeseen events like pandemics to keeping up with evolving marketing trends and ensuring the well-being and satisfaction of both guests and staff, it’s a multifaceted journey. Your awareness of these challenges speaks volumes about your understanding of the industry’s complexities. Keep shining as your insights will undoubtedly contribute to crafting innovative solutions in the future.


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