There is perhaps nothing that more emphasises the “human element” of the hotel business than the relationship between owners and operators.
Starting from the top down, the success of a management contract can be traced back to the strength of the relationship between the owner or owner’s representative and the hotel chain’s CEO or operations chief.
Yes, there are consultants, lawyers and bankers going back and forth between the two, but ultimately, if these two people don’t like each other, it’s unlikely that a partnership will grow.
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This was the consensus of the owners and operators Hotelier spoke with for our cover story (pages 50-55). Each was seeking a long-term partner, somebody who understood — and could help deliver — their vision. Mutual trust, honour and integrity were valued as much as market insight, brands and distribution networks.
As in any relationship, getting the foundations of this partnership and the balance of power right in the early stages is vital. This helps prevent the age-old dilemmas of design dynamism versus operational efficiency, and of achieving grandeur versus gross profits.
The second stage is to continually build on this partnership and hopefully, to develop it further.
As Wyndham Hotel Group president and CEO Eric Danziger points out (page 55), it is surely better for operators to grow their portfolio with fewer business partners than to open each hotel with a new owner.
His recent tie-up with Regency Group Holding in Qatar (page 5) is a perfect example of this.
The same is true for owners, hence why many have strategic partnerships with certain brands. IFA Hotels & Resorts’ tie-up with Fairmont is a case in point (see page 8).
But while trust is a core part of all of these relationships, does one party take more of a risk when it places its trust in the other? And who is catching who on our cover?
Danziger thinks that the owner “is always the boss”. However, the owners claimed that no-one holds the “power ball”. What are your views? Considering the “human element” is involved, maybe juggling the balance of power is what keeps both parties interested?
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