July 27, 2010
Authors
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Eva Dienel
Former Associate Director, Communications, BSR
After two years of development, Hilton Worldwide rolled out a new system to analyze the environmental impacts of its 3,600 properties. The company’s LightStay program measures energy, water, waste, and carbon impacts throughout 200 areas of hotel operations including housekeeping, paper product use, food waste, chemical storage, air quality, and transportation. In 2009, following the first year of the program, Hilton reported that the company has conserved enough energy to power 5,700 homes for a year, enough water to fill more than 650 Olympic-size pools, and the carbon emissions equivalent of taking 34,865 cars off the road. Hilton’s Christopher Corpuel spoke with us about how Hilton is using LightStay to save money—including more than US$29 million in utility costs alone in 2009—and elevate sustainability as a global brand standard.
In its 3,600 properties around the world, Hilton has a variety of brands and also different operating models (some hotels are owned, some are managed, and some are franchised). Given that context, how does this program work at the ground level?
As opposed to mandating specific operational practices, by making sustainability a measure of the business (like quality or service), we’ve found that LightStay gives properties the freedom to make local decisions that fit their property, resources, and market. So one hotel might make a decision to upgrade lighting, another might develop a composting platform to reduce waste cost, and another might elevate existing preventative maintenance practices to increase overall efficiency.
This allows our team members at the ground level to operationalize sustainability on a couple of levels. First, LightStay provides operators with data to identify areas for improvement and take actions to improve hotel performance on a day-to-day, month-to-month, and year-to-year basis.
Second, we’ve integrated sustainability into all of our performance-support channels, such as quality assurance, training, team-member engagement, sales, communications, and marketing. As a result, we’ve created a framework that systematically leverages our existing performance channels and provides all of our stakeholders globally the knowledge, tools, and resources to make effective decisions at the property and brand levels.
Why is this program an important step for a company in the hospitality and tourism industry?
Our hope is that LightStay will elevate the conversation around sustainability as a business discipline. There are real macro and microeconomic issues that all businesses are facing, such as population growth, industrialization, resource depletion, legislation, cost, and supply chain risks. This is further heightened by an ever-increasing amount of transparency, not just in terms of operations but in the quality of our products and services. As a result, we’ve all been forced to think differently about our business. For Hilton Worldwide, our business is hospitality, and sustainability (through the LightStay platform) is another discipline we use to support our business of delivering great guest experiences.
Since you launched this system, have you discovered anything surprising about your business, such as areas where you have the most environmental impact, or opportunities you have to make greater progress on sustainability?
What continually inspires us is the incredible passion our team members put into operating our hotels and making a difference not only for our guests but for the world around them. One example is the Hilton New York. The insights gained from the LightStay system prompted team members to start a waste-decomposition program that eliminates as much as a thousand pounds of garbage a day. In addition, they set up a channel to donate leftover food to charity, donating more than 5,000 pounds of food that otherwise would have gone to waste.
Our greatest opportunities and innovations come from our team members. From a sustainability standpoint, LightStay gives us a common platform to capture these inspirational efforts and replicate them across our global landscape.
What challenges did you face in either developing or in implementing this program?
The biggest challenges were time and our global scope. We’ve been developing our platform for a long time because we knew the foundation we built today would be critical to our long-term success. Given the spotlight on sustainability and the economic drivers on our business, being able to take a methodical, layered approach to sustainability was a challenge.
The second biggest challenge was our size and global scope. Trying to create a single, global platform for our 10 brands and 3,600 hotels in 81 countries (and growing) that our operators and stakeholders could all get value from was difficult. But we had tremendous internal resources across our disciplines (engineering, sales, development, and brands), and a shared vision of what sustainability means to our business.
As a privately held company, Hilton is not expected to report on this information, but your guests and the public might be interested in learning about LightStay. Do you plan to share the results of your program publicly, and, if so, how?
We recently communicated publicly our 2009 results, including reductions of energy, water, waste, and carbon, as well as cost savings of over US$29 million (weather and occupancy adjusted). We also communicated that sustainability is now a global brand standard, and by the end of 2011, all 3,600 hotels in our global portfolio will be required to measure sustainability at the property level. Finally, to confirm the effective implementation and validity of our system, we commissioned KEMA-Registered Quality, Inc. to perform an extensive third-party audit of LightStay.
One of the themes we’re discussing at BSR is sustainable consumption, achieving which requires strong participation by consumers. How does Hilton work with guests to reduce their impacts by “consuming” less?
LightStay offers reports and calculators that provide our customers with information to inform their own decisions. I don’t think you can force consumers to change, and there are still a lot of unknowns about what is sustainable versus what is not. But as awareness and understanding evolve, you start by providing consumers with choices to help inform their purchasing decisions.
Take the example of bottled water. It wasn’t that long ago that bottled water was seen as a sign of health and wellness, and it was even trendy to be seen with the latest brand name. Today, perceptions have changed due to increased awareness around waste and water-scarcity issues. We’re seeing a trend in our business where customers are thinking twice about the decision to have bottled water in meetings and/or guest rooms. As a response, suppliers have been focused on product innovation, and there is an ever-growing supply of choices around filtered water systems, water reclamation, recycling options, and renewable or biodegradable materials used in bottling.
Businesses are headed in the right direction overall, and as awareness, innovation, and legislation continue to progress, we’ll all continue to move forward.
As an expert in the hospitality and tourism industry, what opportunities do you see for this sector in shaping sustainability progress in the next few years?
The biggest role the industry can play is as a catalyst for innovation. Imagine if our hotels were all powered through renewable sources. Imagine if we could achieve zero waste. How can hospitality and tourism become a platform for economic development and begin to alleviate global macro issues such as poverty, food security, and deforestation?
Hospitality and tourism is a multitrillion-dollar industry, and as we begin to further elevate sustainability as a business discipline, we can continue to systematically alter for the positive the natural systems we use to sustain our planet. That’s the role our sector can play, and hopefully Hilton Worldwide can contribute to this larger mission in a thoughtful and meaningful way.
Let’s talk about how BSR can help you to transform your business and achieve your sustainability goals.