COVID-19 has unquestionably created tremendous pressure on humanity and the global economy, and that pressure has been intensified by uncertainty. It remains anyone’s guess when the economy will recover and how the hotel industry and its ‘normal’ will change.
With the goal of further empowering hoteliers to lead through the pressures of the crisis, Kenneth Greger and James Theodore, partners in the New York-based Travel & Hospitality Practice at global executive search firm August Leadership, gathered insights from four industry leaders who have been through similarly daunting challenges before.
Over the next five days, HOTELS will share their findings in Q&A interviews with Arne Sorensen, CEO, Marriott International; Sébastien Bazin, CEO, Accor; Edie Rodriguez, immediate past chairman of the Americas, Ponant Cruise Line (former CEO, president, Crystal Cruise Lines); and Mike Leven, former president and COO, Las Vegas Sands Corp. Greger and Theodore also summarize their takeaways from the conversations.
Greger/Theodore: The move from thriving to a traumatic, overnight industry shutdown is unprecedented in the hospitality industry. You have navigated through substantial business and economic challenges before. What are your key learnings from previous experience, and the fundamental counsel you can share to benefit other CEO’s dealing with COVID-19 and the economic ramifications?
Sorensen: I remember how we sat around the boardroom table on September 11, 2001, and watched the Twin Towers come down. For anyone who is an adult now, it was a day you will never forget. It took us about three to five hours to finally realize the situation was going to be bad for our business; we were completely focused on the tragedy. One thing we thought we knew with certainty back then was that business would never be that bad again. Then the 2008 economic downturn hit, and we faced some similar challenges.
Today’s crisis is truly unprecedented, worse than anything most companies have ever faced. I think businesses have to respond with discipline. You have to cut costs, of course, but remain innovative. How can you be of service? You need to have empathy. You must support your employees, your customers and the communities where you operate. And you have to remain optimistic. This crisis will pass. But not before we work together as a global community to find common solutions.
Bazin: The thing we should be clear on is our priorities. For me, that means protecting my people and supporting my communities. It’s from those communities that we get strength, so it is our responsibility to look after them. It’s also essential to recognize the strengths of our organizations, communicate openly with the teams, and instill values that will help get them through these difficult times.
Finally – and I’ve been saying this for years – always strive to be an actor, not just a spectator. All around the world we are trying to be part of the solution, working with governments and health authorities wherever we can. It’s the right thing to do and people will remember you for it.
Leven: In a position of leadership, the first thing you have to do in a crisis is stand with the pain. You must be incredibly participative with all your key people and you must be present. You can’t run away from a crisis; a crisis is what determines what a great leader you are. There may be a marginal difference between you and another leader in good times, but that difference gets magnified by the better leader during a crisis.
So, when something happens like COVID-19 and you’re in a hospitality shutdown, you’re in charge, you’re the general. You need a key group of people around you that you trust. Work with them to understand the ramifications of the problem and to make the critical decisions for survival. Whether COVID-19 or economic dislocation like the 2008 Great Recession, your responsibility is to have the right people around you and take advantage of their intelligence, but be prepared to make a decision that may not be unanimous. Think about where the business needs to be when the crisis is over, and where it is today, then plan for how you are going to get from point A to point B.
Someone once told me if you’re going to have molars removed by a dentist, do them all in one visit versus one tooth at a time. In situations like this, I’ve seen companies do a Phase 1 reduction in force, and then a Phase 2 reduction. Wrong – sit down, make the plan and get it over with; do it all the first time. When you don’t do it that way, you lose your credibility. Just take on all the pain right away and get it done. Otherwise everyone is on edge and looking over their shoulder. It’s hard to do, but it’s what should be done, and then you can honestly say there will be no more. And if you commit to that, then you must stand by your word. If things get better, bring people back.
You need to understand what your customers are going through and what your employees are going through and make them your priority. Like anything else, everyone has an agenda and your job is to make sure your agenda is to take care of the people you depend on during the crisis, who you will also depend on after the crisis. Too many people are so focused on today they aren’t looking to tomorrow.
Rodriguez: I have had the privilege to work in leadership roles through some historically challenging times, including 9/11, Swine Flu, volcanic ash falling over Iceland in the heart of the European cruise season when planes were unable to fly guests to their ship departures, and many other examples. Today’s reality is that leadership globally, in every industry, has never seen anything like COVID-19 before. We all are truly in unchartered waters. As a leader, I feel it is important to first acknowledge that fact.
The worst incident prior to COVID-19 was probably 9/11 which, until this pandemic, was certainly the most traumatic on the cruise industry’s business, as well as the global travel and hospitality industry. Post 9/11, from a leadership perspective, what always carried me through was the belief that “this too shall pass” and, from the core of my inner soul, to always have an optimistic outlook.
History is a good leadership teacher. If we look at just the last century alone, a number of traumatic situations have occurred such as the Spanish Flu, the Great Depression, etc. In each decade that followed, the world became more innovative with an economy more robust than before. So, while I am confident that history does repeat itself and that this is what will happen post COVID-19, too, as a leader in the midst of this crisis it is one’s responsibility to always be honest, state the facts, and ensure that your teams and clients/guests hold on to hope based on facts.
For now, when bookings and revenues flatline, as a leader you need to ensure all financing is in place to keep your company going and, in this case, for up to two years hoping for a vaccine. Equally important as a leader in the midst of this crisis is to always be honest, state the facts, and ensure that your teams, clients and guests hold onto hope based on facts. You must lead by example, now more than ever, and show your own hope and optimism to your company employees, your past and future guests, and your family and friends.