This is the third in a four-part series by David Keen, CEO of marketing agency Quo, on what hotels need to do to stay competitive. Read the first installment: Hospitality has evolved – and hotels need to think differently, and last week’s: The next step in innovation: What vision looks like. Stay tuned for his thoughts next week.
Even if we take the hotel out of hospitality, it remains a people-centered industry. Enlightened leaders share the vision that people drive this business. Even so, there’s a massive difference between being greeted by a baseball-capped, denim-shirted egalitarian millennial and being ushered in by an attendant wearing a three-piece suit and lapel pin.
That difference is at the core of what defines the future of hospitality. We live in a democratized world where our guests are increasingly searching for that equanimity. The days of “ladies and gentlemen serving ladies and gentlemen” are numbered, and the new reality requires significant organizational change.
It’s time to take the general manager out of the glass box. Gone are the days of the suited emperor roaming the halls and lobbies. Smash that glass box. Evolve the ancient hierarchy with rooms division, F&B, engineering, personnel and others and banish them to the hospitality museum along with the type-written welcome cards and those chocolates on the pillows.
Top-down hierarchical management – endemic in the hotel industry – is not the future. Brands from Motel One to CitizenM are taking a bottom-up approach. Loosely labeled the inverted pyramid, the organization pivots from its leader sitting at the top of an org chart to him or her conducting from the point of the V at the bottom of the chart. This simple inversion allows the leader to drive direction, while front-line employees at the top of the chart engage with customers. They are the ones who hold the brand in their hands. Theirs is the responsibility to speak in the brand’s voice, to imagine brand experiences and, most important, to deliver on them.
Andre Wiringa, the author of “Start Reverse” and CXO of Netherlands-based Performance Solutions, guides the service strategy of many of the world’s most forwarding-thinking brands. “New hotel brands like Moxy, Me and All, Rove and Radisson Red break with the traditional structure with many layers that the hospitality sector is known for. Co-workers are fully empowered to delight their guests in whatever way possible. They are coached, rather than managed, and next to a hotel manager there are only two levels in each hotel. If you wish to speak of hierarchy, it is deliberately inverted or reversed,” says Wiringa.
Democratizing decision-making does not mean we lose the ability to drive vision. The difference is that the levels above the CEO in an inverted pyramid are empowered to make decisions and to direct change.
Serendib Leisure, a leading travel conglomerate in Sri Lanka with interests in hotels, destination management, airlines and outbound travel, embraced this change. The company has implemented the inverted-pyramid approach, and the CEO conducts his teams from the pivot of the V structure. The company is in the process of changing its name to reflect this new structure but has already begun to work within it.
CEO Malinga Arsakularatne has even changed the interior structure of the office so all management now sit in an open space and are empowered to drive change. The various team members go to Arsakularatne for guidance and support. He sees this change in philosophy as the core of the company’s future. “We have empowered a brand manager with the responsibility to create her own concept, implement it and bring the brand to life,” he explains. “We now are in the position to have operating resorts that would not have happened under the previous structure.”
While Sébastien Bazin, chairman and CEO of AccorHotels, hasn’t inverted the management pyramid, he has empowered the youth within the hotel group in the form of what the group calls a “Shadow Comex,” which the AccorHotels website describes as such:
“In 2016 we led the way in being the first major French group to create a ‘Shadow Comex’ because of our conviction that a business goes farther by sharing the decision-making power. Six men and six women, all aged under 35, who are players in our cultural transformation. By being involved in strategic decisions, they are contributing towards making AccorHotels attentive and close to future generations.”
Bazin believes these younger perspectives help the organization maintain future relevance:
“Young people have a sharper ability than us to anticipate the world of tomorrow. Particularly on matters that are central to some of the current issues facing the Group: new guests’ expectations in terms of services and the guest experience more generally.”
The traditional structure is now a costly and unimaginative anachronism that inhibits progress. There’s an absolute correlation between the leading brands of tomorrow and substantial organizational progress today.
David Keen spoke about Quo’s vision for the future of hospitality at the first THINC Innovate conference in Bangkok in May, on which this series is based.