Blog #3: How to get ahead when your brand is built on staying the same

In my first career following college, I was fortunate enough to take my first steps in management via several roles at a historic luxury hotel in New York City. As I was new to the workforce and the industry, my first years were spent absorbing as much information as I could about management and leadership.  Unfortunately, my first years also happened to be during the 2007-2008 financial crisis, so I was able to get a front-row seat early on to strategy interventions, as the fallout from the crash rocked our organization to the core. With a drastic reduction in reservations, events, and meetings from our clients in the corporate sectors, the hotel had to think creatively to adjust and compensate.

Reflecting on this now, with consideration to the strategies Carroll and Mui shared that often misfire, I’m now able to recognize a few potentially problematic approaches the hotel may have taken in the 2000s. Primarily, as a historic hotel, there was a focus on preserving the historical and luxurious charm that had served the hotel for generations, and often an understandable reluctance to update, upgrade and improve existing amenities.  “Staying the Course” as depicted in the “Seven Ways to Fail Big” article may have ignored what customers were now looking for; increased value and amenities for the money they chose to spend there. Continuing to focus on the heritage and legacy of the property as its greatest selling points, instead of modernizing select areas and amenities to create more value may have led customers to shop elsewhere.

That’s not to say the hotel didn’t invest in its own success. Around this time, management invested in a new spa, new retailers, and new amenities aimed at keeping guests on the premises. These ventures saw varying levels of interest and success but may have appeared as a less cohesive brand from a guest’s perspective.  Without factoring in the capabilities needed for 3^rd party vendor integration that Leinwand and Mainardi outline in “The Coherence Premium”, valuable capital may have been spent trying to bolster the chances of success for those vendors instead of being invested back into the hotel’s core offerings.

In an interview with Hotel Royal General Manager, Henrik Lind, Emilia Jaakkola explores how his 170 Swedish hotel stays relevant and in demand.  As Lind describes it, “I use to say, what’s the difference in running a hotel in 1850, 1950 or 2050? I think there’s no difference: you welcome guests, give them a key, serve breakfast and then say goodbye again. We don’t want to change existing best practices just because something is the new thing in the market.”  Lind goes on to eschew change for changes’ sake, instead choosing a thoughtful approach to new amenities, selecting only those that would revolutionize the guest experience (Jaakkola).

Strategically investing more resources into what the hotel did best (outstanding service and attention to details) instead of divesting into similar, but less coherent side ventures to try and capitalize on market trends, might have helped the property better keep their focus, and therefore keep the attention of their clientele.

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Carroll, Paul B. and Chunka Mui. “Seven Ways to Fail Big.” Harvard Business Review, Sept. 2008

Jaakkola, Emilia. “How To Keep A Historical Hotel Relevant To Modern Travelers” March 5, 2019. Retrieved from https://www.hotelspeak.com/2019/03/how-to-keep-a-historical-hotel-relevant-to-modern-travelers-interview-with-hotel-manager-henrik-lind/

Leinwand, Paul and Cesare Mainardi. “The Coherence Premium.” Harvard Business Review, June 2010)