Warning Signs Your Hotel is in Trouble... and May Need Outside Help

By Bill Morrissey President, Morrissey Hospitality Companies | October 28, 2008

Given the complexity of running a successful operation today, there are many ways a hotel can find itself in trouble and in need of outside help. Some pretty obvious indicators that things aren't going very well might include:

That last one is really a quote from Albert Einstein, so I really can't say it's an original thought. And as far as I know, Dr. Einstein did not own or operate a hotel. But the simplicity of his words suggest that when things are not going as expected it's a good time to seek out fresh thinking and address issues affecting the business; what are the current market conditions, how have they changed over time, and how is the property responding to them? What has the competitive set done that in some way threatens or jeopardizes the business long-term? What do your customers think, feel, and believe about your brand?

Being prepared, a decree not exclusive to the Boy Scouts, works well in planning for the ups and downs of running a hotel operation. Having a solid sales and marketing effort supporting all revenue generating areas and reacting to current market conditions affecting the hotel is fundamental. But protecting the reputation of the brand is often overlooked or not prioritized in far too many organizations.

Beyond the issues listed above, many of which are a result of poor revenue performance, there are, of course, many external factors that can unexpectedly and negatively affect the business and brand, such as a food borne illness outbreak, labor dispute, or traumatic newsworthy event. Acts or situations that oftentimes happen outside the control of hotel management can have long-lasting damaging effects on the property. How the management team and brand respond to such issues when they happen is critical, and having a trained team with a crisis or issues management preparedness plan at the ready can be the difference between defending the brand versus seeing it destroyed when under attack.

So to address the topic of "Warning signs your hotel is in trouble...and may need outside help," I would suggest a simple question: Are you prepared for when your brand's reputation is under fire jeopardizing the entire business? Having a crisis plan written down and understood by key employees is critical to ensure that as much as possible you control the issue threatening your brand instead of letting it get control over you.

At our properties, we place great value on the reputation of each brand under management. With a diverse portfolio and each property having its own unique characteristics and operational nuances, we strive to place an emphasis on managing the reputation of the brand and providing a quality guest experience over all else. A strong and healthy brand can be more resilient during hard times, and opportunistic during good times. And it needs to be supported and defended every day by every employee representing it. At its simplest form, a brand is a promise made to people who entrust us with their business, regardless if for leisure or corporate use, to us every day. Operations staff deliver on the brand promise being made to the guest, and if there is a disconnect in the guest's mind between the perceived versus actual experience, the brand is broken. Even when shown through the eyes of the media. One of the true tests of a brand promise comes when a crisis occurs.

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Coming up in March 2019...

Human Resources: An Era of Transition

Traditionally, the human resource department administers five key areas within a hotel operation - compliance, compensation and benefits, organizational dynamics, selection and retention, and training and development. However, HR professionals are also presently involved in culture-building activities, as well as implementing new employee on-boarding practices and engagement initiatives. As a result, HR professionals have been elevated to senior leadership status, creating value and profit within their organization. Still, they continue to face some intractable issues, including a shrinking talent pool and the need to recruit top-notch employees who are empowered to provide outstanding customer service. In order to attract top-tier talent, one option is to take advantage of recruitment opportunities offered through colleges and universities, especially if they have a hospitality major. This pool of prospective employees is likely to be better educated and more enthusiastic than walk-in hires. Also, once hired, there could be additional training and development opportunities that stem from an association with a college or university. Continuing education courses, business conferences, seminars and online instruction - all can be a valuable source of employee development opportunities. In addition to meeting recruitment demands in the present, HR professionals must also be forward-thinking, anticipating the skills that will be needed in the future to meet guest expectations. One such skill that is becoming increasingly valued is “resilience”, the ability to “go with the flow” and not become overwhelmed by the disruptive influences  of change and reinvention. In an era of transition—new technologies, expanding markets, consolidation of brands and businesses, and modifications in people's values and lifestyles - the capacity to remain flexible, nimble and resilient is a valuable skill to possess. The March Hotel Business Review will examine some of the strategies that HR professionals are employing to ensure that their hotel operations continue to thrive.