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Three focus areas of every consistent and successful hospitality product.
A company’s purpose is to advance its vision, and since a vision is a mountaintop you never quite get to, you should have an infinite time horizon. But many hotel management and asset management companies are designed to be finite. Are you one of them?
Airbnb Co-Founder, CEO and Head of Community Brian Chesky sent the following message to the Airbnb Community outlining their vision to build a 21st Century Company. This extract can definitively be embedded in the hospitality framework extensively.
“I know that a lot of companies are thinking about being long-term oriented, but an alternative way of thinking about it is being infinite. Being an infinite company is an idea that my friend, author Simon Sinek, has been discussing with me. Simon explained that a company’s purpose is to advance its vision, and since a vision is a mountaintop you never quite get to, you should have an infinite time horizon. But many companies are designed to be finite. Finite companies are focused on beating their competitors and appeasing short-term interests. But business is not finite. Unlike sports, there is no time clock, so there can be no winning or losing – there is merely surviving and innovating to endure. This doesn’t mean that meeting clear goals isn’t important or that you should lose your sense of urgency and avoid tough decisions. Short term success is still important so long as it advances your vision. As Simon put it, it means that your focus should be on getting to the mountaintop, not the rest stop on the way up the mountain.”
Short Term Upside: Contrary to Brian’s viewpoint, hotels are increasingly becoming a breeding ground for ‘short term upside focused on financials’ because of the way industry is structured. This neither serves the management company nor the asset owner.
Politics of comparison and corrosion of vision: If the hotel is located in a hyper competitive destination, the fight for survival and comparison scales up tremendously. Wondering where does your property lie in this landscape? The location / city plays a key part in driving the competitive landscape, Booking.com has compared 6 key metrics of competitive cities – Booking.com city comparison data
· In such competitive cities, each stint of management team responsible at the hotel level needs to have three fundamental focus areas to advance its vision beyond the lifetime, which then compound & merge with exceptional leadership execution – exactly in the below order:
2. Serve guests & all stakeholders,
3. Financial KPIs
· Where is the Brand value: Sounds hypothetical but just consider this “if it was just about the financials then why would you have a management contract with a NYSE listed management company with a long term vision that has spent millions in creating cultural ethos, employee policies, vision statement, etc.”
· Communicating the vision: The asset owner is considering a long term vision for the product and needs his team of “representative of owners” to communicate the same with the management company responsible for operations.
· Continuity of vision as a KPI: Every incoming and outgoing team should have “skin in the game” a.k.a. accountability for continuity of vision for the asset and the asset owner. This talk by Nassim Taleb at Google headquarters available on YouTube brilliantly describes this phenomenon across industries.
Strategy Cues: Our vision statement developed through experiences of over 100s of properties envelops this industry wide challenge:
Through Strategy Cues, we are committed to offering our partners a transparent, user friendly, agile and replicable strategic framework based on an analytical foundation.
Our vision is to empower the management teams to provide extraordinary guest and employee experiences while we fuel the commercial engines with digital firepower.
Founder, Strategy Cues
May 16, 2022
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