These initiatives that change the world
These initiatives that change the world
Japanese inn reduces work hours and doubles sales
The economic development of postwar Japan has been supported by people working long hours, submitting to job relocations and rarely refusing to travel for business. It is difficult to combine such a work culture with family life, namely providing child-rearing and nursing care.
Karoshi (death from overwork) and companies that overwork their employees have become real problems in Japanese society. And yet, according to a 2017 OECD report, Japan’s productivity ranks the lowest among G7 nations, well below the average.
With a working population decreasing due to a decline in births and an increase in the number of elderly, there is a widespread labor shortage in the country that has affected even the service industry. Many enterprises have been forced to shorten business hours due to lack of staff.
One might think that working less leads to fewer profits. But in Hadano, Kanagawa Prefecture, one ryokan (a traditional Japanese inn) managed to double its profits despite closing its doors three days a week. The average annual salary of its staff grew by 40 percent.
A few simple yet highly effective changes to the way the business was run made all the difference.
The Jinya inn’s watershed moment came after the sudden death of its owner in 2009. His eldest son, Tomio Miyazaki, now 40, left his job as an engineer for a major automaker to take over the business. Miyazaki’s wife, Tomoko, also 40, became its manager just two months after giving birth, even though she had never worked in a ryokan before.
The couple found that the inn had debts of one billion Japanese yen (USD 9.1 million) due to mismanagement and excessive waste. When they attempted a management analysis, they found only paper ledgers to provide data.
Viewing information technology as the solution to the business’s problems, they developed software to manage and standardize a range of tasks, from reservations to accounting. They distributed tablets to all staff members so that employees could share information, such as customer preferences, to improve customer service. The new system also gave the staff a more positive approach to their work.
The owners installed sensors on the communal bath, notifying employees when the number of customers who had used it exceeded a certain cut-off. The sensors meant that staff no longer had to visit the bath repeatedly to check whether it needed cleaning.
Extra revenue stream
With the introduction of IT, the couple reduced wasteful working practices, and channeled their employees’ energies toward creating better meals and other selling points. They gradually raised room rates, and created an extra revenue stream by selling the management system to other inns. The business’s performance improved, but at the same time, a new problem emerged – Tomoko was exhausted from working nonstop without any days off. “Even if customer satisfaction rises, it is meaningless if the workers’ quality of life does not improve too,” she said.
In 2014, the couple made the radical move to close the inn every Tuesday and Wednesday, a decision that drew complaints from customers expressing disbelief that a ryokan would close on certain days. They went further in 2016, deciding to close after lunch on Mondays and to stop taking overnight guests on Mondays.
In spite of the changes, total annual sales for the inn and its group companies increased from 290 million yen in 2010 to 726 million yen today. Part of this growth was due to the improved quality and reputation of the food being served.
Before the changes, the inn had 20 regular employees. But under the new system, the team has been reconfigured to include 25 full-time staff and fewer part-timers. The staff is also sharing in the benefits of the business’s growth. Annual average incomes have increased from 2.88 million yen to 3.98 million yen, while employee turnover has dropped from 33 percent to 4 percent. This is an industry where incomes are generally low, even if people work hard. “The service industry has taken for granted workers’ dedication to customer satisfaction,” said Tomoko.
The Jinya ryokan marked its hundredth anniversary in 2018. “I want to promote a way of working that can accommodate different stages of life, such as child-rearing and nursing care, for the entire [service] industry,” Tomoko said. “I’m aiming to make inns an industry in which people long to work.”