Macro Global Trends Impacting the Hotel Industry
By Marc Glasser Managing Director, RM LLC | March 25, 2012
This article is "global" (intentional pun) in nature as we discuss macro global trends and significant associated information. There are numerous macro global trends, directly or indirectly, impacting the hotel industry. While most of the article content does not identify specific Macro Global Trends Impacting the Hotel Industry this in no way detracts from the critical importance of the identified global trends below. Please pay particular attention and emphasis to the identified global trends below. Their importance and management are enhanced by this article's supplemental information. Before we identify global trends impacting the hotel industry it is important to emphasize there is a direct correlation between macro global trends impacting your company and company valuation. Value impact can be in terms of such quantifiable indicators as: company stock price and company value (including privately held corporations); market share and room rates. Additionally, harder factors "to quantify" include: company reputation and your customers' feeling of safety and security. There are certainly a lot of details associated with global trends, company valuation, awareness and action. This article will concisely address some of the significant details. First we will discuss macro global trend awareness.
As a hotel executive you have a responsibility to your stakeholders to be aware of current macro global trends and "Black Swan" events (discussed below) impacting the hotel industry including your company. Further, you need to be aware of and be able to assess less significant global and local trends to determine the likelihood they may indeed progress to significant macro events impacting your hotel operations. It is important to note that "stakeholders" include equity shareholders, privately held/company owners, senior executives to include your company's Crisis Management Team as well as customers, employees, vendors, regulators and the media. This list is by no means all-encompassing. Additionally, in smaller companies senior management and staff often wear "multiple hats". For example, in a smaller company the Crisis Management Team, whether officially designated or not, may consist solely of the CEO (or appropriately titled individual fulfilling the typical CEO responsibilities) and/or executives already having responsibilities for multiple business functions.
Crisis Management Teams, Global Trends and Company Value
Up to this point in this article, we have utilized the term "Crisis Management Team" a few times. Let's explain further. A company's Crisis Management Team considers strategic and tactical responses to a significant crisis affecting the company and provides direction to, among others, c-suite, emergency management, business continuity, supply chain, security and public relations company personnel. A company's Crisis Management Team's (or those serving this role) response, or lack thereof, to a macro global trend or significant regional or local event can further have a "macro" impact on your hotel operations, positively or negatively. The response can range from comprehensive mitigation, response and recovery plans to"nonexistent" awareness and lack of preparedness. If your company is lacking the Crisis Management Team function, it may be because senior company management:
is unaware of potential or impacting macro trends;
is aware of the significant trends but is not adequately aware of likely ramifications affecting company hotel operations and bottom line; or