REDESIGN TO A LEAN COST STRUCTURE

24 hours Business Centre

A ‘Control without compromise’ service redesign by The Regent, Singapore

How can you extend the operation of business centre to 24 hours and reduce
operating coverage of the staff; a seeming contradiction to achieve a leaner cost?

Control without compromise

‘Control without compromise’ is our collective response to the current financial

crisis and the rapid deteriorating economic condition. It is a right, timely and
necessary response to meet the challenges ahead of us.

The top line revenue in every business is declining rapidly and is multiple in
magnitudes to the same adjustment one can make on the cost and expense.

Cost reduction strategy

Cost reduction is an end and not a mean for us to be effective to achieve the
objective of outlasting the crisis. It is the thinking at the existing structure with the
attempt to cut, reduce, defer, omit or negotiate at the current cost.

If you begin with reduction in mind, the common defects associated with it are
− The acceptance that the current structure is the best, which often may not
be the case and miss the opportunity to take advantage of the downturn
where ample time is available to explore the alternative;
− Applying the wrong strategy and worked on area beyond your area of
influence;
− It does not provide value for money assessment;
− Quality of service and staff morale may be threatened;
− Inefficient allocation of resources where the higher cost item that form your
main value driver to your customer may be cut and other idle resources
continue to exist

Redesign cost structure

This is a sustainable alternative that can withstand the test of time.

Conceptually it contrasts with cost reduction as follow

$
Reduction
$

$
Structure
Structure
$

In a cost reduction, it is the amount you need to reduce that leads you to
implement the various measures to achieve it, and often it does not modify your
existing cost structure.

Page 1 of 6
REDESIGN TO A LEAN COST STRUCTURE
24 hours Business Centre
A ‘Control without compromise’ service redesign by The Regent, Singapore

In a redesign, it compels you to examine the existing structure, to explore the

advantage associated with the redesign, and modify with the outcome of a leaner
structure. It is the outcome of the structure that determines your cost.

Instead of beginning with a cost reduction strategy; begins with a lean cost
structure strategy. Such an approach will provide you with the benefits of
− reexamine the existing needs and cost structure associated with it
− focus on strategy that can contribute to sustainable development
− enhance service quality
− deliver value for money and the outcome you wish to accomplish
− align resources allocation with strategy

Innovative redesign

As you redesign the cost structure, you will find that in every innovation, it will
involves 4 phases of development

Visioning - What is your most desirable outcome

Exploring - What are the various components you need to explore
Experimenting - How can you mix, combine or alter the existing
offering with a better outcome
Modifying - How you can consistently deliver the better solution
under a modified offering

Visioning Exploring

Experimenting Modifying

For example in the case of a Smart phone innovation, the 4 phases of

development involved

Visioning - The most innovative mobile business phone

Exploring - To talk is the current use of the existing phone and
the most crucial value driver

Page 2 of 6
REDESIGN TO A LEAN COST STRUCTURE
24 hours Business Centre
A ‘Control without compromise’ service redesign by The Regent, Singapore

Experimenting - How can the talk combine with image and internet
access to improve the communication? Will a camera work
with a phone? Will a mini PC work with a phone?
Modifying - A new modified product emerged from a normal
phone to a sophisticated smart phone

Another innovation you may notice is the TV mobile on a bus.

In short, I called this ‘VEEM’ innovation framework

Business Centre

I initiated using Business Centre as a development for the team to work in

applying VEEM innovation framework with the objective of modifying its cost
structure and consequently lead to a leaner cost as an outcome.

Append was the experience we gathered at this development

Visioning

The thinking involved at visioning were

• It should excite guests and staff.
How a new structure can provide 24 hours service, meet on demand request and
support shorter working hours in shift?
• What guests want
Is 24 hours service consistent with the others services available in the hotel
meeting the demand of the guest?
• World class
Is 24 hours business centre a world class offering and provide us with a
competitive advantage?
• Quality process

Page 3 of 6
REDESIGN TO A LEAN COST STRUCTURE
24 hours Business Centre
A ‘Control without compromise’ service redesign by The Regent, Singapore

Does this lead to quality improvement?

• Strategic positioning
How can this strengthen the strategic positioning of Regent as a business hotel
• Ideal for future
Is this foreseeable by everyone as an ideal future?

Exploring

The groundwork gathered at the fact finding included

• It should wow guests and staff
What are the various steps need to be in place to support a 24 hours business
centre?
Can the guest keycard use to provide free access to the business centre in the
same manner we promote 24 hours pool and gym?
How can our staff benefit with the multi skill training through the shift rotation and
planned coverage after the manned hours at business centre?
• It could break rules
How safe is it to break away from the current operating hours?
• Start afresh
To reexamine the needs and understand the contacts with the guests, to start
afresh with a new offering of a 24 hours business centre
• Invent new rule
What are the new rules we need to invent under the new offering? How can
security be involved to ensure the safety and security of the guests?
• New assumptions formed after exploration
As we explored each of the service aspects, new assumptions were formed as
an agreement with Regent Club, Front Office and Business Centre to move this
one step further.

Experimenting

The various combination of ideas were mixed to test the acceptance level of the
new scheme
• It should amuse guests and staff
Is the self serve free access business centre a better guest experience?
What were the feedbacks?
How the staff affected by the new operating shift?
• Find the right mix of ideas while testing guests
Can an alarm be fitted at the free access hour for the safety and security of the
guest?
How is the security patrolling hours affected by this change?
• Best synergy
Is Regent Club stepping in as relief shift the best synergy for operational
efficiency?
• New solution

Page 4 of 6
REDESIGN TO A LEAN COST STRUCTURE
24 hours Business Centre
A ‘Control without compromise’ service redesign by The Regent, Singapore

How do we communicate this new solution to staffs, guests, contractors and all
concerned parties?

Modifying

After experimenting with success, build in the ‘fail safe’ system and widely
communicate to the whole team. The modified service needs to be able to
implement as a best practice consistently
• It should satisfy guests and staff
The differentiation in service should be an edge where you can win and create a
competitive advantage
• The process should add value and modify with better services to
customers
Applying the same thinking of a 24 hours service in a hotel, the 24 hours
business centre in the modified offering must deliver a better service to the
guests
• Extend offering
Free internet access is value add in the extended offering we offer during the self
service hours in the modification.
• Improve process
The safety and security process concerning business centre is improved as a
consequence of 24 hours business centre.
• Core competency
The core competency of business centre operation is extended to other staffs in
supporting the modification.

Adapt and adopt

Conceptually it may appear to be a progressive framework where you move from

visioning, exploring, experimenting to modifying. In practice, you must always
have all four in mind in the implementation.

In the implementation, you need both facilitative and directive leadership to make
it works. You can facilitate an initiative from the team, keep the goal in mind and
it can accelerate as they take full ownership over it. At times, you may encounter
conflict among team members in their deliberation; you need to make a stand to
direct in the best interests and take the best available options to push forward the
initiative.

In the process of adapting and adopting new practices, a few important points to
note

Communicate – You need to communicate upward to seek buy in, lateral to win
support from your team members to support and downward to get the employee
to agree on the plan.

Page 5 of 6
REDESIGN TO A LEAN COST STRUCTURE
24 hours Business Centre
A ‘Control without compromise’ service redesign by The Regent, Singapore

Commitment – Communicate with no specific measurable goal is like working

with a moving target or no target. You need to set goal that aligns to your vision
and seek commitment with measurable goals from every team members. You
cannot manage what you cannot measure!

Relationship – While you can be perfectly rationale in your approach to meet the
plan. Emotional intelligence is required for you to maintain the relationship so
that your team is with you throughout the entire process. Creating a small
taskforce, celebrate success along the way, arrange brain storming session are
some of the approaches you can use to cement the relationship.

Get it right, get me right and Wow me if you can

Get it right – It is crucial to begin with the guest experience in mind in any
strategic change to the service. By understanding the need of today business
traveler demand of a 24 hours accessibility to a business centre, a redesign
present an excellent opportunity to get it right for the guest.

Get me right – To achieve cost saving through first get it right is consequential to
our objective to outlast the current crisis; and it also provides an opportunity to
sustain any such initiative into a longer term, modified and expanded the offering
in the services needed previously but not available.

Wow me if you can – With the right mindset, everything is achievable if you take
your leadership and full ownership to deliver the Wow.

Transactional change Vs transformation

It is clear from this re- design; you can learn that transformation in the service
process contributed to a leaner cost structure, without compromising guest
experience.

On the contrary, the guest experience is enhanced with 24 hours business centre
accessibility that previously not available.

It is through transformation that can lead to sustainable cost structure, and

consequently a leaner cost outcome. It is definitely not one begin with the set
transactional cost outcome to determine the service process, which potentially
can lead to compromise in guest and employee experiences.

A transactional annual cost saving of over $20k is the outcome of this

transformation under a ‘control without compromise’ experience.

Page 6 of 6