Are Your Hotel Assets Optimizing Company Value?

Hotel Asset Management: A stakeholder take

By S. Lakshmi Narasimhan Founder, Ignite Insight LLC | July 28, 2013

The Confusion

One of the most confusing terms used in the business world and more so in the hospitality industry is Asset Management. Boardroom meetings reverberate to the sound of this and related buzzwords. Do you have an effective asset management strategy goes the refrain. Many times, the person asking the question is as puzzled as the person being addressed. This confusion is born out of the fact that traditionally an asset is considered the domain of the bean counters or accountants - how to account for them, how to physically verify them, how to charge depreciation on them and so forth. But asset management as a strategy is far removed from the mere act of accounting for the purchase and use of an asset. In fact, so much hinges on how the word "asset" and the term "asset management" are understood to realize its worth and value.

What is an Asset?

While the layperson's understanding of an asset is: "any item of value," a more technical definition would be: "items on a balance sheet showing the book value of property owned."

Narrowing the technical definition and simplifying it, assets refer to the tangible, intangible, short and long term property and investments owned by a business.

Primary Role of an Asset

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Guest Service: A Culture of YES

In a recent global consumers report, 97% of the participants said that customer service is a major factor in their loyalty to a brand, and 76% said they view customer service as the true test of how much a company values them. And since there is no industry more reliant on customer satisfaction than the hotel industry, managers must be unrelenting in their determination to hire, train and empower the very best people, and to create a culture of exceptional customer service within their organization. Of course, this begins with hiring the right people. There are people who are naturally service-oriented; people who are warm, empathetic, enthusiastic, pleasant, thoughtful and optimistic; people who take pride in their ability to solve problems for the hotel guests they are serving. Then, those same employees must be empowered to solve problems using their own judgment, without having to track down a manager to do it. This is how seamless problem solving and conflict resolution are achieved in guest service. This willingness to empower employees is part of creating a Culture of Yes within an organization.  The goal is to create an environment in which everyone is striving to say “Yes”, rather than figuring out ways to say, “No”. It is essential that this attitude be instilled in all frontline, customer-facing, employees. Finally, in order to ensure that the hotel can generate a consistent level of performance across a wide variety of situations, management must also put in place well-defined systems and standards, and then educate their employees about them. Every employee must be aware of and responsible for every standard that applies in their department. The April issue of the Hotel Business Review will document what some leading hotels are doing to cultivate and manage guest satisfaction in their operations.