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Outsourcing: Turn the Inn Around

Hanover Inn.jpgThe Gang of 75 put forward another thought in their recent open letter to President Kim, this time about what the College should not do: outsource to independent companies the management of Dartmouth facilities like the Hanover Inn:

… we are concerned about the practice of subcontracting various services at the college to workers who are not Dartmouth employees. Subcontracting has been historically used to undermine workers’ pay, job security, seniority and benefits. We urge Dartmouth to steer clear of such labor practices. Furthermore, when work is done by those who are not Dartmouth employees, it is rarely done with the same pride and care for the Dartmouth community as long-time employees have shown. That, too, undermines the Dartmouth experience.

Let’s speak frankly, as is our wont. The Hanover Inn is a mess and it has been so for many years. We’ve looked at the Inn before, but its failings bear repeated recitation: it is losing money; it requires sizable investments in modernization; managing a hotel in a competitive market is not something that the College is equipped to do well; the Inn’s reputation for food is so poor that the Daniel Webster Room is no longer even open for dinner; and relations between management are awful, as evidenced by the unionization of the staff a few years ago and repeated State of New Hampshire Labor Department fines over the fair distribution of gratuities.

How to turn the place around? There is only one way: start over. A business and employee culture that is this badly broken is rarely, if ever, fixable. New management alone won’t do the trick.

The College should lease out the Inn to a private operator with proven hotel experience. All employees would be reviewed, and after competitive interviews, the best will be rehired, but many of the employees who staff the new entity will be new to the industry. All will be given thorough training in modern hotel practices, and wages and benefits will be aligned with the competitive market in the Upper Valley. The culture where Inn employees just laughed at waste because “the College can pay for it” will come to a justified end.

To what result? A cash drain on the College will become a source of profit. Instead of subsidizing an inefficient and poor quality facility, the Inn will return to its days as a successful enterprise, and it will generate a fixed amount of rent money each year that will allow the College to hire more professors.

Does anyone who is serious about education have an argument with that?

A Note to the Gang of 75: President Kim is bringing a tide of reform to Hanover. Your reaction to his efforts should go beyond standing by the sidelines yelling “Stop.”

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