A panel of hotel company strategists at the 10th annual Hotel Data Conference shared best practices for creating and implementing a successful strategy.
NASHVILLE, Tennessee—Strategy can be more than just a corporate buzzword, but it takes company-wide adoption to realize its full benefits, according to a group of hotel strategy executives.
During the “An inside look at strategists’ insights” session at the recent Hotel Data Conference, panelists said a successful strategy ensures every employee at a company can see how their work fits into it.
Introducing an overarching strategy begins as a set of guiding principles to be deployed across departments, said Sam Makani, VP of portfolio strategy and reporting at Solid Rock Group. With that in place, a company can start to consider who it is working with, internally or externally, and the valuation proposition it will create for them, he said.
“It’s a matter of aligning your departments so the resources can be used to achieve those principles,” he said.
A company’s strategy has to be simple enough to fit on one piece of paper, said Susan Sanders, SVP of strategic planning at Hospitality Ventures Management Group. Step one is being transparent with strategy so employees at the property level understand what the corporate office is doing every day to support the hotels, she said. Step two is simplicity, starting with the mission, vision and culture of the company, she said.
Understanding what the company can say no to and why will help to make decisions with limited resources, she said.
“That’s what the strategic plan is doing for the company: aligning your culture, making decisions so you have a solid path moving forward,” Sanders said.
The framework for Hilton’s strategy lives within its culture, said Stephanie Atiase, senior director of corporate strategy and corporate development at Hilton. It starts with a baseline of understanding on how the company is performing, which means looking at things like revenue per available room index as well as feedback from customers and owners, she said.
Hilton also looks at trends within the industry, as well as business models outside of the industry, to find potential disruptors, she said.
“We think about all those disruptions and innovations and then we go through a process of understanding where we actually want to go and where do we think we have the best value proposition to succeed,” Atiase said. “As we’re thinking about all those things, we come up with our key strategic priorities for the company, and this is everything from what does it mean to be a team member of the company to what does it mean to deliver for our customer, what does it mean to actually grow and what markets we actually want to grow in.”
The company communicates these priorities to all team members through leaders, town halls and other traditional means, she said.
Communicating strategy and getting buy-in
“You have to repeat yourself a lot,” said Brenna Halliday, VP of strategic insight at Host Hotels & Resorts. “You feel like you sound like a broken record.”
Hilton’s focus is less on the big meetings, where presentations are made to the executive team, and more on the small one-on-one meetings that lead up to that, she said.
“Know your stakeholders in advance, have those conversations in advance, and the big meetings is a kind of check-the-box,” she said. “It’s also about the little meetings that happen afterward right before you revisit that strategy and say how each of those decisions fits in.”
Halliday suggested hoteliers should think about the best steak they ever had. If there was a red wine reduction on the steak, the chef likely spent a great amount of time reducing the sauce.
“The more concentrated and reduced that sauce is, the more memorable your meal is going to be,” she said. “That’s my advice: Boil it down.”
Businesses just want to achieve profit, Makani said. It’s not that complicated, so keep it simple, he said.
“Convey value with your strategy to those above you, to those below you, toward the goal of making the company succeed by being profitable,” he said.
The strategy message should be simple and relevant to the audience, Sanders said. That means conversations with investors will differ from those with brand companies, which will also be different form the internal conversations, she said. Communication should be face-to-face as much as possible, she said.
The data involved in strategizing sometimes can lead to information overload, Halliday said. For starters, what people can call data is changing. To inform its predictive analysis, for example, Host is working to move beyond just using numbers and spreadsheets to look at the words being said about different markets.
It can be overwhelming for those who are starting out with a strategy, she said. It’s important to come back to what is the question the company is trying to answer, she said.
“It’s so easy to get lost in your research and go off in different directions and different sub-questions,” she said. “Come back to what (is) the main question. Start with that, go back to it and end with it.”
Sanders advised hotel strategists to focus on a few key metrics and use to compare against the entire hotel portfolio.
“That is our prime source of information, and we keep true to that,” she said. “I feel what I’m doing is making sure people stay focused on the total picture. If we have to drill down, we drill down. Keep it simple. Keep the metrics at the right level and (don’t) get pulled off track looking at too much data.”
One of the greatest skills a person can learn is how to use data visualization, and it can be as simple as creating graphs and charts in Excel, Makani said. With a large amount of data that Excel can’t process quickly or can’t visualize in creative ways, strategists have to look to other tools. This can help hoteliers make their point and value propositions in a way that’s understandable to their directors and executives, he said.