Is the wolf scratching at the door? Lessons learned so far from the COVID era...
11 experts shared their view
The past six months of the COVID-19 pandemic has forced companies and individuals to reconsider not only what they do, where they do it, and how they do it, but also why they do what they do (or don't do what they don't do). In other words, it has forced executives to reflect more intensely on both the external environment in which their firms compete and the ways in which they do so. Strategic thinking, management, and implementation have never been more important than now in the hospitality industry as countless firms across the world are fighting for their survival. As Professor Richard Rumelt once wrote, successful companies may not actually engage in strategy work until the "wolf is at the door." In today's COVID-19 world, not only is the wolf at the door, but he is scratching to get in, ready to blow the house (or hotel) down. The question, therefore, is what have you and/or your firm learned most about your business strategy, and what are you doing about it?
Planning is Everything; the Plan is Nothing
My experience is being successful has an ability to constantly develop its strategy and adapt business development and skills. Like a sports team how every day tries to improve. Therefore, the wolf rarely comes to visit.
Effects of COVID 19
I believe there is new knowledge and confirmation to be added to the hotel business.
Market
Confirmation: the domestic market has always been the most important and the most stable segment. Most likely will the domestic business be larger than ever in 2021. Is this a long term trend?
New knowledge: resort and leisure business is the most value-adding product segment. Not international business.
Staycon segment is new learning. People how normally traveling frequently to international destinations travel, as a consequence of pandemic, domestically, and stay at premium hotels with has a luxury independent profile. The global brand does not fit in here.
Distribution
Confirmation: local brands are more stable
New knowledge: local and regional brands strengths their positions vs global brands.
OTA challenge global brands more than ever.
Business development
Confirmation: the most important value-adding element for hotels is high-skill operations with a focus on productivity.
New knowledge: more leisure products must be included in the hotels' product range.
Management and organization
Confirmation: positive and visible leadership is always key in crises time. The centralized organization is not a good model in this environment.
New development: multi-skill, less reporting- better to talk, better to things, even if this wrong than to wait for attitude is the right to move.
Business models
Confirmation: specialization limits strategy development. The management contract with global brands is out. The fix lease model is out.
New development of hotels is an expensive and high-risk business.
New knowledge: be active in the full value chain is value-adding. The management contract with the third-party local player is in. We need a new version of the Franchise Contract. More focus on key elements for distribution less on brand standards.
Revenue lease model with share investment is in.