Recently a very high profile management company parted ways from a well established hotel . The first causality was Trust. The owner felt having invested crores, the management company took him for a jolly ride . While the latter felt that they were used like a news paper, absorbed all the knowledge and threw them out in a day!! The point is both sides should think that they are complementing each other and not pulling in the opposite directions. Despite their excellent technical systems, these companies are sacked. Obviously in these hard times the comfort factor is slowly missing between the two and the crack widens beyond the trust lines. Care and sensitivity is the watchword. The owner is vary naturally, but he needs to be embedded in a circle of trust. The company being the industry expert needs to be the catalyst and warm the developer so to speak.
Educating the promoter
Our high profile owners who have “arrived in life “ tasted success already in other walks of life. Training him should not be a challenge .He expects the employees to be trained. So we spending a 30% time on him is well worth the effort during the initial period. Bring in the finer nuances of hotel business to him. Take him to the trade shows such as Express Hospitality world, IITM fair etc. Meeting the industry experts at these events broadens his vision hospitality wise. Invite him to your training manager’s seminars or trade conferences. Interesting industry clippings should be sent to him with regular frequency. Forward emails on current topics and hoteliers quotes. Subscribe magazines for him. Bench marking is another fine example of enlightening him. We always show him similar hotels in his class. Discussing few strategies on the spot makes effective sense. You are giving him the Look and feel experience.
Project the owner
We follow a very effective approach, the new clients are presented in our news letter –Budding hotelier. Their background, strengths and talents are show cased. This gives them the innate feeling of being the star of the management company. We had organized a series of Udaya TV interviews for Mr. Ramesh, director of the underground cave resort – Guhantara. He felt good and was able to talk about his resort with great passion, as he was the architect too. The spin off was a great bonding between us. Take them to forums such as SKAL etc .Get him to quote few times on Radio instead of your GM/ chef.
Be Transparent Always
This is the most critical constituent of the business relationship. Explain the details with tons of patience, repeating if he doesn’t get it. Don’t use jargon please. What may seem a normal simple term like ARR( average room rate), may be Latin for him. Tell me how many us know FAR. It just flew over you know? This a common word from the construction industry it seems.(Floor Area Ratio ). The devil is in the details, any projection / quote should be sieved well with him, this gives him confidence in you. Your genuine oversight sometimes is seen with tinted glasses. During pre opening always approve a quote from a basket of at least five proposals. While recruiting the senior managers, see many candidates if they are going to be on his rolls. Lets not force his decisions, but take them together. Maintain a balance though, its not that you are bulldozed. Behave like an owner in words and deeds. After an exhaustive negotiation the other day, Mr. Narender Reddy, the owner of Time Square hotel , Secunderabad commented “ I was wondering who the promoter was, you have handled the deal so well without compromising the quality or quantity “.Get on to his side of the fence. Due to exigencies if the management company has changed some plans, ensure that you keep him posted as if there is a fire. Hearing from you is always desirable, there’s no room for miscommunication. No strategy change is to be ignored.
Dispel the fear
After a great presentation and having impressed Mr. Naidu sufficiently, We could see the contract on the horizon. This was for a 90room hotel. After a while He was very silent and almost brooding. Inexplicable .He said much later “If something happens between us, you will pull out all the staff and I will be rudderless!! This is a genuine fear most owners have, respect it. Take pains to dispel the fear. Don’t switch staff even if the contract is over, its not worth to spoil a relationship over a bar man, albeit you may miss his awesome cocktails.
It’s a good idea to get his nod in case we need to quote his property in the press. Many a time he wants to keep it under wraps until the launch.
Talk Bottom lines
Many MCs make it a ritual to get the owners attend the monthly Profit and loss meetings. The total Kundali is presented there and he envisages the picture directly. After all he has the right to know the good or the ugly side. Create happy visions if the bottom line is great and present solutions /strategies other wise. Be proactive.
For instance the inventory in Bangalore lately has increased by over 4500 rooms, with a similar number in the pipeline .The occupancy is slowly climbing up to 70%. We have yet to beat the recession blues , this is as per the industry sources .The developers know these trends and need the experts to worry about the operations , sales and marketing challenges . It’s a win- win situation for all if the trust is omnipotent .The management company just needs to work on the WOW factor.
As a parting shot may I say “ Its easy to get a management contract, but lot tougher to retain the trust and make an impact “
The author is Venu Rao,
Director
Peacock Group, Bangalore
