Hospitality Financial Leadership - What Do Indy Car Racing and the Hotel Business Have in Common?
By David Lund, The Hotel Financial Coach
I am a big fan of professional car racing. I follow the major series; Formula One, NASCAR and my favorite times 10 is Indy Car. When I think about what I like so much around the Indy Car Series there is a parallel to the hotel business that I think needs to be exposed so people will have a better understanding of why Indy Car is so special and how being successful in the hotel business is kind of the same. You might think I'm stretching things here just a little, but I promise you I'm not.
Indy Car, in my opinion, is the purest form of auto racing on the planet because you need to be multi-disciplined as a driver. It is unique in its formula for success when compared to other forms of racing. To be successful in the hotel business you also need to be skilled and master the different areas of the business. Without the collective prowess behind the wheel at the different types of tracks, a race car driver will be at a big disadvantage. Same goes for a hotelier who does not have experience in the divergent areas of the operation, different hotel types and the mastery of the individual pillars of the business.
Let's start with what it takes to be a champion in an Indy Car. There is a total of four distinctly different types of tracks that this series races on. To win the series title you must be proficient at all of the various venues' categories or the numbers will be stacked against you.
The first and perhaps the most popular at least by attendance is the Super Speedway. Indianapolis Motor Speedway is the quintessential example of this track type. Lap speeds are well in access of 220 miles per hour. For you kilometer people that's 355 KPH. The track length is over 2 miles and the drivers turn left for the normal race distance of 500 miles. This kind of racing is exciting to watch and from what I have seen in open wheel racing it's uniquely Indy Car.
The second race track on the menu is what is referred to as a permanent road course. This is what you see Formula 1 cars race on all season, other than Monaco and a couple of other street tracks. Like the title suggests these tracks are only used as race courses. They wind their way left and right, up and down and the courses feature tight turns and lots of passing under braking. Spa in Belgium is my dream track. Some good examples in North America are Watkins Glen (that's where the photo was taken) and another is Sonoma.
The third kind is what is referred to as a short oval or a bull ring. Phoenix and Nazareth are great examples of these tracks. Very exciting and fast. The tracks are usually less than 1 mile and lap times are in the sub-20-second range. Lots of passing and action.
The fourth and final discipline an Indy Car driver needs to master is the street circuit. Toronto or Long Beach are examples of these circuits. The race course is created each year right out of normal city streets. Tight, fast, and rough are the hallmarks of this kind of course.
With four distinctly different types of tracks, you can see that in order to be the series champion you need to be good at all four.
The hotel business is the same. Instead of different types of tracks, we have different pillars or constituents that the budding hotel executive needs to master.
The first one is the guest and guest service. This is the forward-facing "be all and end all" feature of hospitality. Good guest service is synonymous with the hotel landscape. So much so that the slogan - "Look after the guests and the money looks after itself" is something I grew up on, which by the way is not true. The money never looks after itself. I wrote an article on this, you can find it at. https://hotelfinancialcoach.com/f-tar-w-the-secret-recipe-for-creating-financial-leadership-in-your-hotel/
The second pillar is colleague engagement. Being a leader that others want to follow is the necessary performance and when you put engaged colleagues and managers with great guest service the outcome is often a great experience for your guests.
The third constituent is the brand or if you're an independent, the hotel's name. There is so much equity that can be created with a strong brand. The hallmarks and features of the brand and the property are what help to differentiate the hotel from its competition. Mastering the brand value proposition is key.
The forth mainstay that the hotel manager needs to master is his or her financials. This is often the missing link to winning the season championship. Some like to leave it up to the Director of Finance, but the seasoned GM knows the numbers are the turbo boost they need to win it all.
Once you know the secret to winning the game, and the season, the whole deal just gets to be a whole lot more fun. Being the leader that makes sure the ship is being run by a team of managers who all have their own financial shtick together is like being the driver at the Indy!
David Lund is The Hotel Financial Coach, an international hospitality financial leadership expert. He has held positions as a Regional Financial Controller, Corporate Director and Hotel Manager with an international brand for over 30 years. He authored an award-winning workshop on hospitality financial leadership and has delivered it to hundreds of hotel managers.More from David Lund