For years, most thoughtful market forecasts and industry predictions have included some sort of disclaimer—a caveat that there are inherent limits to any big-picture prediction, and that a “black swan” event like a natural disaster or sudden global recession could radically change the baseline assumptions upon which those forecasts were based.
In the spring of 2020, hospitality professionals across the country and around the world got an unwelcome demonstration of that dynamic in action. When the true scale of the coronavirus pandemic became clear, and large-scale shutdowns began in earnest, hotel owners and operators were faced—virtually overnight—with a historic set of challenges.
More than six months later, we know a lot more about the nature of the public health challenges before us, but many questions remain. Hotel brands and hotel management experts have evolved and adapted the structure of their organizations, the nature of their service, and the operational parameters in their properties. While the initial shock of the pandemic has passed, myriad uncertainties remain. Hotel management companies are asking themselves important questions about where they are today and where they are headed in the weeks and months ahead.
In a fractured and uncertain hospitality landscape, where do you draw the line between making necessary changes and remaining true to yourself and your business model? What role does management company size play in delivering services during a pandemic? And, perhaps most urgently, are you prepared to respond given what is likely to unfold throughout the rest of this year and into 2021?
Staying the course
When everything is in turmoil, it’s only natural to respond by reassessing your priorities and obligations. Some change is important, even essential, as business as usual is not prudent when business is most assuredly anything but usual. It is critically important to remain focused on your company’s strengths while assessing each opportunity; does it align with your organization’s core values and structure? A quick revenue opportunity must be weighed against the potential risks to your brand and the ability to service current clients, often it is wise to avoid big pivots and stay the course. These are frequently difficult decisions. It is easy to get caught up in short-term solutions when a long-term approach might be the more astute choice to consider. Whatever your decision, once made it is imperative to gain the commitment of your team and then support them in the execution of the strategy. When there is so much uncertainty you may have to reevaluate and tweak your approach numerous times as market conditions fluctuate and industry forecasts are updated.
Does size matter?
There are certainly some competitive advantages that come with larger management companies, buying power and the scale to take on larger hotel portfolios would be two easy ones. As with any industry, however, one size does not fit all. Many ownership groups are looking for a hotel management company that is structured to provide a higher level of support than the large mega companies within our industry. Typically, these are individual or smaller hotel portfolio clients that value partnership and collaboration, requiring a high-touch and responsive senior level focus committed to understanding their assets and goals for success. The hotel industry has been hit hard by COVID-19 business declines with many brand companies and hotel management companies being forced to lay off mid-level and senior management positions – know and understand what changes are happening with your management partner. Does size matter? It depends on your objectives.
The way forward
The big question, of course, is what’s next? And the big frustration for industry professionals is that the answer to that question is dependent on so many variables that are out of our collective control. With that in mind, the smart play when devising a roadmap for the remainder of 2020 is to control what you can control. Continue evaluating and improving systems, and continue investing in your team with ongoing training and development—ensuring their personal and professional success as we slowly emerge from the pandemic. Stay focused on opportunities to improve. Apply intense focus on revenue management and sales opportunities, adapt creative ways to utilize or repurpose meeting and food-and-beverage spaces. Make sure existing clients’ needs are met and work hard to cultivate new relationships with clients who need your special set of skills to succeed. As challenging as the pandemic has been, for those that are prepared, it is an opportunity to highlight your ability to perform in any market environment. Now is the moment where the pivot from adversity to opportunity is happening in real time. Make the most of it.
Chris Green is president and CEO of Chesapeake Hospitality.
The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or its parent company, STR and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to comment or contact an editor with any questions or concerns.