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Why so many luxury hotels fail

Throughout my time in the hospitality industry, I’ve found that there are two main scenarios which can lead to the downfall of a hotel. A great team handling a mediocre asset, or a mediocre team handling a great asset, one is always ill equipped to handle the other. Yet, even a great asset managed by a great team can still fail. So, what are they doing wrong?

The reasons I’ve found for such issues staying afloat are, what I like to call, their walls and their silos, and these always end up leading to the downfall of any property’s success.

Contributed by Louis Sailer, founder, Nullus Ineptias, Innsbruck, Austria

The walls are the creation of invisible walls that are usually caused by the person in charge of the property – someone who may allow politics by his management subordinates in the workplace.

These walls inhibit people from doing their jobs properly as they are no longer a unified team across all departments and disciplines, but have become departmentalized. The silos are built when the corporate governance starts taking care of their own areas of interest, instead of putting the hotel first. It can lead to favoritism being shown, which is always a dangerous gamble. That is why I recommend holistically reviewing a property or company, as you can very quickly see through any kind of facade they put on, spotting their strengths and their weaknesses.

Working at the top end of the company is a busy undertaking, but so is working on the ground. My mother was someone who gave me one of the best pieces of advice, she said to “never forget where you come from,” which is why I find it advisable for the leaders, of any aspect of a company, to step back for a minute and review what’s being dealt with hands on, to listen to what the customers have to say, as well as all the other voices to be heard within the company. Doing this allows you to revisit, re-group and re-evaluate your standpoint to improve your company, and ultimately your guests’ experience, as well as profits that follow.

All you need is one person to pull these together, to connect every aspect, and to tie up loose ends. A visionary for the company, someone who’s passionate about what they do, who will believe in your company’s message, its people, and its product, all before promoting and selling it to the world.

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