Beyond simply achieving their budget targets, General Managers need to help develop a clearly defined strategy for their hotel and stick to it. COOs want them to maintain discipline and not divert off course in the business model, which will ultimately amplify the values of their brand.
This sentiment was highlighted from a panel of COOs representing Accor, Hilton, Hyatt, Marriott and ITC at the Hotel Operations Summit India – General Managers in Focus.
Dealing With Owners
Today’s GM also needs to have great communication skills as they deal with owners. Whether market conditions are challenging or not, owners are rarely happy with the budget. GMs need to convey what is realistically achievable and and be able to both educate and negotiate with owners. They also need to have a clear understanding of the owners debt financing structure, so that reasonable compromise can come from both sides.
“If the owners expectations are aligned with market realities and the General Manager drives the best premiums in market, an owner can’t challenge that,” said Rajeev Menon, Chief Operations Office SE Asia and Pacific, Marriott International.
“The most important thing is that there be no surprises,” added Daniel Welk, Vice President Operations – India, Hilton Worldwide. “GMs need to over communicate, not under communicate. This is especially true when dealing with the many first-time owners in India.”
In India, there have been many instances where, with owner’s keen to release equity in the property, new openings have come prior to full completion. It’s obviously better to confront that pressure and hold off until the property is ready. At a minimum, all public areas should be complete, as you cannot compromise on service to your first customers. Their initial experiences will impact how quickly you can ramp up.
Most GMs come to pre-openings 6-9 months before completion, so there is often little they can do to influence what the design and tech teams have specified for the property. Where it makes sense, adjustments may be made, but most of a property’s physical attributes are down to the brand blueprint and owner’s budget, rather than the GM.
“Designers and tech teams are living in past,” declared Hyatt’s Peter Fulton, Group President – EAME and SW Asia. “Why are ballroom’s still designed for balls, which nobody has anymore?”
Overly complex lighting and entertainment systems in rooms was cited as another pain point area that GM must inherit and live with. Decisions on those specifications happen 24 months before opening, well before most GMs come on board.
“Technology is sexy and in the drive to create something new, we’re sometimes losing touch with the way customers use rooms,” Fulton added.
Hiring General Managers
The panel agreed that hiring the right GM depends on the hotel’s profile. All look for leadership qualities and people who can drive the business and not be driven by the business.
Accor primarily develops General Managers internally, according to Accor’s Jean-Michel Casse, Sr. Vice President Operations – India. “With the company’s growth rate, there has been some pressure in getting new GMs
and now many are getting promoted at a younger age than you would see previously.”
GMs are increasingly dealing with owner’s reps and it is important to make them understand what is happening in the market. It is often easier if they have a hotel background, as they better understand hotel operations and the impact of changing market conditions. With no hotel background, you may have to deal with a bigger learning curve in their understanding of your business.
“You must understand how empowered the owner’s rep is. Are they a line to the vision of the owners or simply playing bad cop?” said Dipak Haksar, Chief Operating Officer Hotels Division ITC Limited. “By the same token, where you see value, you must make the changes they recommend.”