Tourism faces major cuts

| 22/11/2010

(CNS): The Department of Tourism is set to lose much of its current functions to various other government departments as part of the civil service efficiency drive. According to the recent report by the civil service review team, some $3.5m from the DoT budget of almost $27m can be saved by policy changes, downsizing and transferring or outsourcing responsibilities to other agencies. The team also called for an end to Jazz Fest and other promotions that the DoT manages, saying it should contribute no more than 25% to host the various other events throughout the year. The team said DoT does several things outside the stated strategic focus of tourism and needed to refocus on promoting the islands.

“Over the years, DOT has accumulated ancillary functions, the cumulative effect of which detracts from the core focus of the department,” the civil service review team said in its recent report, adding that non-core activities should be transferred or outsourced to allow it to focus on its main mission.

The review team said the administration of tourism scholarships should be transferred to the Education Council, and training to the education ministry or privatised. It said the analysis of tourism statistical data could go to Economics and Statistics Office, money collection to treasury and accommodation inspections could be done by Department of Environmental Health. It also said the department needed to cut overseas staff.

“A review of DoT expenditure and budget showed that over 60% of overseas staff time is spent on promotional activities, meaning that the government has hired overseas staff primarily to attend promotional activities at … a cost of up to $7.9 million … The review team questions the justification for spending 31% of the department’s entire budget on promotional activities,” the report stated.

The team revealed a lack of performance indicators to justify that level of expenditure. Signalling the death knell for Jazz Fest, the review team said it was concerned that the return on investment of managing tourism events is not clearly established or well monitored. “An example is the Jazz Festival, the net cost of which was $1.0 million in 2009. It was not clear what contribution the Jazz Festival made to tourist visitation figures. Also, some industry stakeholders questioned the timing of the Jazz Festival and believed that the timing is not in the best interest of the economy.”

As well as the restructuring of the US office, which is already underway, the review team proposed a restructuring of all the DoT offices, including Grand Cayman.

“The Review Team is concerned that staffing levels are excessive, outdated and are not cost effective,” the report said. “DoT employs more than 35% of its local and overseas staff in marketing roles. In addition DoT has outsourced $9.0 million of marketing expenditure. The Review Team is concerned that the true productivity gains from outsourcing through a re-alignment of staffing have not been achieved.”

It said the cost of the UK office of $2.3 million cannot be justified in terms of the passengers coming from Britain. “There is significant potential to reduce the current spend of $1.2 million on advertising and $600k on other promotional activities.”

The team recommended redirecting some of the spending to the Canadian office, which it said has the potential to increase tourist arrivals as Canada has a direct air link. The Review Team was advised that air arrivals from Canada could be doubled with input of more resources.

HR staffing levels in the department were also seen as “far in excess of the standard benchmark” for other government departments and recommended the redeployment of at least two people from human resources.

The team recommended placing more emphasis on web management, which it said was critical for the success of tourism. It said the current website and its functionality is outdated in comparison with other jurisdictions. “A review of DoT‟s internet strategy, management and resourcing is urgently needed. The Review Team believes that some of the savings identified elsewhere in this review should be redirected to upgrading the website and to developing a comprehensive E-strategy.”

Although the DoT management agreed with some of the recommendations it questioned whether tourism training could be outsourced to the private sector noting that, had this been a viable business proposition, a vocational institute specialising in tourism would have already been developed. The department also raised concerns about others inspecting tourism premises as it said DoT officers have the requisite knowledge of the laws and regulations and industry. “It is highly questionable whether another government agency would be able to effectively represent the government’s interest,” the DoT said.

Tourism managers also disagreed with the recommendation to pass on the analysis of tourism date to the ESO. “The department’s data collection, research and surveys is an ongoing and integral part of our activities so that informed business decisions can be made for effecting tourism strategies,” the DoT said. 

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  1. Anonymous says:

    The question is, if they make the necessary cuts, who will get the contract for outsourcing the same work? Will it be former tourism directors who sit on aviation and tourism boards? People, you have to read between the lines. If a department can’t be controlled directly, then it will be controlled by the same person indirectly. We should all question this big time!

  2. Anonymous says:

    It’s a shame that most of that report is not accurate. A lot of cuts were made that were not reflected in that report which is a shame because all it does is shed DoT in a bad light. Once again that does nothing to help Tourism.

    People seem to think that DoT can do everything. People have a preconceived notion that Cayman is expensive and doesn’t give a value for the money.

    Why? Accommodations are very expensive and face it: the service sucks.

    I have been in the airport and watched a certain nationality speaking their native tongue to their friend, tourists go into the shop and she waits till they go to the cash register before getting up and going inside the shop to serve them.
    Another bad habit that I have observed and have happen to me is cashiers talking to friends while they are checking me out so if I need to ask a question, I can’t.

  3. Anonymous says:

    Oh no…..hurry come back Mac……its only 24 days to success ! Yay !

  4. neilburrowes says:

    marek you are spot on – i hope the dot will seek and follow your advise – so we can maximize the return on investment –

  5. Anonymous says:

    er did u not read the date on the report wich is 10 March lots of cuts made since then all ready this is not even news

  6. Just Wonderin' says:

    Oh wow! Ring the bells!!! Government is poised to undertake a whopping trimming of DOT services to save 13%. But hold on! This somehow doesn’t sound so efficient to me.

    Ok…assuming the story is accurate, something is just not right.

    It appears that the DOT is set to loose a greater part of its functions, right? And yet the savings is a paltry $3.5 million cut of a $27 million budget??

    I should have known this was gonna be bad when I saw that this is part of a Government efficiency initiative.Whenever you see the words "civil service"  and "efficiency" in the same sentence, watch out!

    With math like this, no wonder the country is broke as a convict.

  7. Anonymous says:

    Thank god we are going to stop wasting money on so much DOT nonsense! Most of the what the DOT does has been a waste of time and money for the last several years.

    Ever since our clueless politicians made the decision to essentially give up on high-end stay over tourism and destroy Grand Cayman to appease the cattle barges (cruise ships), DOT’s mission has been mostly pointless. People just take “Caribbean cruises”. They don’t know or care where in they hell they get off for a few hours. It’s about the ship and the region. Cayman is just a place to stretch your legs, pee, and buy a carved coconut made in Honduras.

    DOT made sense back in the 70s and 80s when we were trying to be a special place for wealthier vacationers. McKeeva primarily, and others led us away from that and opted for tall condos and more ships per day.

    Sad, but it’s a done deal so stop wasting money advertising. Just keep fellating the cruise ship industry and keep importing those Honduran trinkets to sell to the cheopo tourists we now cater to.

    • Anonymous says:

      unfortunately you represent the majority view (at least the loudest) when it comes to cruise tourism…and the ironic thing is that you’re complaining about the lack of marketing success, yet simultaneously not being able to see the massive market that arrives daily at the cruise port…..whilst you may not like the ‘cattle ships’, you grossly mis-read the opportunity for the DOT to market Cayman right there infront of over a million people that have already set foot in Cayman!!!……the mistake govt is making is really simple – there is no Minister of Tourism (instead it seems the leader has many hats, and thats no good anywhere, least of all in Cayman), so there is zero focus…..then there is a massive budget for the DOT (with no leadership)…so it gets mis-spent…big surprise…..i doubt that any of the employees in the DOT deliberately mis-spend or deliberately get things wrong…..they for sure have caymans best interests at heart…but they have no leadership…..and now they are reducing the marketing spend……business 101….reduce marketing at your peril…….right now is the time to INCREASE marketing, especially if others in the region are stepping back…….

    • Anonymous says:

      I would agree and add that the staff at CIG Tourism is misguided and underqualified.  The highest paid ppeople are government hacks,  not born marketers, and even those with the most experience in marketing and the best of intentions in their role are quickly stifled.  Far better to work to get a TV show produced here that is set in Cayman.  If I ran government,  I would have a crack three person industry laispn team in Los Angles lobbying HARD, each day (on one year to 18 month shifts so they don’t get too comfortable in LA) to get more television shows and film productions to feature episodes shot in the Cayman Islands.  The state of Hawaii did this in the 70’s and 80’s to great success (it brought us Magnum PI and Hawaii 5 0) and jamaica did it in the 80’s bringing us cocktail. 

  8. Libertarian says:

    Great to see the efforts made towards reducing the size or downsizing the government workforce.  : )

  9. market smarter says:

    I LIKE the black cab taxi “wrap” I bet that does not cost a bundle and gets a lot of looks.

    I also saw a contest to WIN tickets to Cayman last summer in a hair salon (it is a large UK franchise chain so this was “bang for our buck)

    Think smarter and watch where we throw our tourism dollars.

    Right now with West Jet direct from Toronto, we should be looking at our frugal Canadian neighbors, their economy is still decent.

    Try this DOT???

    From Wikipedia, the free encyclopedia

    The concept of guerrilla marketing was invented as an unconventional system of promotions that relies on time, energy and imagination rather than a big marketing budget. Typically, guerrilla marketing campaigns are unexpected and unconventional; potentially interactive;[1] and consumers are targeted in unexpected places.[2] The objective of guerrilla marketing is to create a unique, engaging and thought-provoking concept to generate buzz, and consequently turn viral. The term was coined and defined by Jay Conrad Levinson in his book Guerrilla Marketing. The term has since entered the popular vocabulary and marketing textbooks.
    Guerrilla marketing involves unusual approaches such as intercept encounters in public places, street giveaways of products, PR stunts, any unconventional marketing intended to get maximum results from minimal resources. More innovative approaches to Guerrilla marketing now utilize cutting edge mobile digital technologies to really engage the consumer and create a memorable brand experience.

  10. Reason says:

    I think the auditor should insure that the DOT has been getting their tourist tax from all the hotels too. XXXX Who collects for all the private condos that are rented? It is hard times, we need to downsize and watch our budgets.

  11. Anonymous says:

    This is a step in the right direction!
    I’ve been to events that were sponsored by the DOT and it was EMBARRASSING! A handful of young employees lounging around, not even speaking to the “tourists” and the senior government executives propping up a bar and ignoring everyone. I was lucky enough to be invited as a guest of the press covering the event and felt if I had to jump in to be a friendly ambassador (since the local DOT employees did not seem interested at all).

    Social media is the way to get or word out, not bloated advertising budgets or conferences. We do not need overstaffed overseas offices either. Work smarter!!!

    Again, make the senior employees of these departments ACCOUNTABLE and measure their results. For too long this has department has just been one big toga party.

  12. Joe Bananas says:

    At last! Some indication that Cayman might be able to survive itself. This is obviously not an idea that comes from the leadership of the country so we all must wait and see if it can overcome the current “take all you can and give nothing back” attitude that has permeated anything Government in Grand Cayman for so long. I can’t tell you how nice it is to see something like this in the news.

  13. Anonymous says:

    Tell the DoT to take a look at the Trip Advisor forums.  We volunteer destination experts for CI do more to promote the islands thatn the whole Department does!

    • Anonymous says:

       I have seen some of the advise from the "Destination Experts" and it wasn’t accurate at least not about Cayman Brac and Little Cayman.

  14. Marek says:

     Where is the first place most people look when considering vacation spots. It’s NOT TELEVISION or PRINT MEDIA… it’s the internet.

    Conventions SUCK and are a total waste of money. The only people that go to trade shows are people looking for swag and your competitors to see what you’re offering and how they can top you. 

    Our internet footprint is ‘terrible’. 

    Consumers go to blogs, Facebook, Flicker, Twitter and travel related websites, they read reviews and they search out local media outlets to get on the ground info.

    We can so cost effectively address this short coming.

    Viral Marketing… it works… when consumers post and write their own stories, when they upload their own photo’s. 

    THIS WORKS, people have always had a crowd mentality.

    Take St. Barts for example, a worldwide winter tourist hotspot covered with media, hollywood and yachts… but St. Barts has nothing on Grand Cayman. We have better hotels, better beaches… better everything… and we are a lot easier and a lot cheaper to get to.

    People go… because … people go.  The yachts go, for no practical reason what-so-ever… they go, because the other yachts go… 

    If we can make Cayman ‘hot’… then all those things will happen here.

    We need to use the web to get people talkingand there are very cost effective ways of doing that.

    Last word… in St. Barts around this time of year and bed and breakfast goes for $1,000 a night… not the nice ones… there are no cabs, roads suck, attitude is ‘terrible’.

    Every new person I meet who comes here says the same thing. I had no idea how beautiful it was… I had no idea how good the food was, I had no idea how friendly everybody is.  

    • noname says:

      Well said Marek!

      The problem we have in Cayman is there are too many dinosaurs at the helm.

      They most likely entered into contracts and agreements with international PR frms back in the 1970s / 1980s and have established ‘good relationships’ with said firms.

      As you said – our internet footprint is horrible – almost non-existent!

      Even though we have had many young Caymanians in what one would assume to be influential positions in the Dept. of Tourism – I have not to date seen a change in our approach to marketing.

      Like many of our dying local businesses – too many of us are intent on doing things in the same way as when our boom took off back in the 1980s – plus many of the old heads simply refuse to relinquish control to the younger ones.

      (The expense of sending an entire delegation to a convention is so ridiculously played out. Computer, internet, campaign, go!)

      It appears to simply be more of the same … I scoff everytime I see their smug, smiling faces on the welcoming pages of our magazines.

      Unless one does the job they are paid to do they are NOTHING but a POSER in my book.

      Get with the program DoT!

      (By the way – what percentage of Monte Carlo / Cannes / Nice etc. tourists can actually ‘afford’ that lifestyle? Not a lot – shoot, even I have been there! However, people go …why? Because it is the place to go! The vast majority of their visitors have never opened the pages of, much less viewed one of their adverts in ‘Yachting Magazine’.)

      How does the saying go?

      ‘Build it and they will come.’

      Well, we have built it – but its not much use if no one knows about it, is it?

    • Lachlan MacTavish says:

      Thank-you Marek. It is not so much the DOT staff and management though. It is more ministerial leadership and policy making. The DOT has lost its way due to no real direction from above. Jazz Fest, no stats, no accountability 1 million dollars. You are correct about promotions and junkets. Since the leaders of the country travel to excess why not department heads. Face to face is gone. You are 100% on the web, web sites, web marketing, interactive web programs, make your own package on the web etc etc. For years we have wasting most of the 25 million spent every year. BTW you also are very correct about St. Barts. I have been there and it is expensive, the french are rude and it is hard to get to. 


  15. Anonymous says:

    Well done to the Review Team. Eliminating the waste in government is the key to getting government back on the right track.

  16. Anonymous says:

    The obese, bloated, self serving government departments were built over the years by self serving empire builders; both politicians and senior managers.

    It is refreshing to see the call for putting these obese departments on a strict diet.

    I hope and pray that the diet is implemented and maintained.