When Heads of State Visit Your Hotel

By David Lund Hospitality & Leadership Expert, The Hotel Financial Coach | June 25, 2017

When heads of state come to visit your hotel they usually make a bit of a show. The Russians are no exception, they even bring their own warship, the KGB and a wad of cash!

I had the pleasure of witnessing the Russian President Dmitriy Medvedev arrival in San Francisco in June of 2010. He flew in the presidential plane, meanwhile his missile cruiser Varyag sailed into San Francisco Bay to accompany his visit. Heads of state often have a ship accompany them on their state visits.

The first and previous last time a Russian warship entered San Francisco Bay it was almost 150 years earlier during the American Civil War. The Russians sent two warships to America during the civil war to show the Union their support at a time when the English and France were thought to be supports of the Southern Confederacy.

The Russian Presidents team took over two whole floors of the main building of the hotel. Almost 100 rooms in total for his staff and hangers on. Upon his arrival, the President was greeted in the lobby of the hotel by former secretary of state, George Schultz and the then current California Governor, Arnold Schwarzenegger. The Russian President arrived with a rather long line of military and support staff including a couple of beautiful younger ladies. It was quite a show and I was quite surprised that it all took place in the very public lobby. Usually, these meet and greets are behind closed doors. The typical modus operandi is the head of state arrives at the hotel and he or she is usually greeted by the General Manager and then quickly escorted to their private reception where the politicians and public figures greet them. The show that day was very public and there was no press, just unassuming hotel guests that were now witnessed to the international meet and greet.

The Russians stayed 3 nights and racked up a pretty good bill, just north of $600,000. Most of the bill was for food and beverage with some incredibly lavish items. When groups come to your hotel they quite often ask for credit. In the hotel business, this is a common practice that is one of the hallmarks of our industry. Direct billing, we like to call it and we still do this and it's a direct result of our business being so old and competitive. All hotels would love to stop granting credit but we can't because we would lose a competitive feature. In order to ascertain your group or companies credit worthiness, we use certain credit reporting agencies and also our own sister hotels credit history. Having a group like this in-house can be high risk as it is political in nature and anything can happen. Having no deposit, no credit references and no credit card on file would normally be a potential disaster waiting to happen. When its government, especially a government with the label power of the Russian President you just hold your breath.

Word came after day 2 that the account would be paid upon departure, in cash. This is incredibly unusual for an account of this size. In my entire 30+ plus year career I only had one other group pay their group account in cash at it was $250,000. The Russians had requested a simple receipt for their payment in the form of a hotel folio with the total amount indicated and an embossed stamp that said, PAID. We actually had such a one-handed stamp that looked like a pair of pliers with what would appear to be two large coins on each end. they were not interested in the reams of paper that would normally accompany the master account. All they wanted was this one piece of embossed paper!

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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.