AREA GM INTERVIEW: Starwood's Heinz Grub

After a successful 2011, Heinz F. Grub, area manager – Dubai for Starwood Hotels and Resorts, sets the scene for an even stronger 2012, with bullish growth, timely renovations and customer-focused service sitting top of his priority list

Heinz F. Grub, area manager Dubai for Starwood Hotels and Resorts and GM at Sheraton Dubai Creek Hotel & Towers, missed out on the so-called boom days of Dubai when he took up his role in the ill-fated year of 2009.

However, during his three years in the emirate, Grub has witnessed — and delivered at the eight Sheraton, Four Points by Sheraton and Le Méridien hotels he is responsible for — slow but steady improvements in hotel performance, as well as promising increases in inventory.

Last year, he recalls, “was a very good year”, with a “wonderful increase in occupancy” and a “slight increase” in rate over 2010 and very strong food and beverage business.

“It was really nice to get back onto the upswing, to see that our hotels are running in the very high 80 percentile, lower 90 percentile,” says Grub, explaining that this was an increase of between seven and eight percent on the year before.

He attributes the 2011 demand to the positioning of Dubai as a safe haven against Middle Eastern instability, relative affordability of the city compared to previous years and increased flight capacity into Dubai from Africa, South America and Eastern Europe.

Corporate business was particularly strong, notes Grub: “I can tell you that the corporate markets for our city-based hotels increased by close to double digit numbers [in 2011 over 2010]”.

Looking now into 2012 and Grub is confident that the MICE market will pick up.

“I am certain it will — at least we have budgeted for it, that whole business travelling. You see you have your business travellers and your semi business-leisure travellers.

People bring their wives or husbands along, and add a few days to it — stay a day or two longer,” observes Grub, who expects February 2012 to possibly be an even better month than the usually strong January because many visitors will come “just to tank up on sunshine”.

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2012 focus
To meet the needs of this market, Grub says his focus is to offer value — to guests and owners.

“The priority is driving value,” he states. “There is still a great potential here in Dubai…we are still focusing on our corporate business, obviously, where it is appropriate. We are focusing on the higher end of the market. We are focusing on our yielding, how well do we yield against our competitors. We are looking at an increase of four-to-five percent turnover for 2012.”

But that’s not all — in 2012 many of Starwood’s upcoming hotel openings and planned renovation projects will be refreshed and Grub is keen to kickstart these.

“And our focus is to begin opening our new hotels,” he continues. “[These include] the Sheraton Sheikh Zayed Road, which is right next to The Monarch; we are driving our new builds in Sharjah, which include a 360-room beach-front property with the Sheraton brand in Sharjah, a Four Points property opposite the blue souk and a Luxury Collection hotel just across the boarder of Sharjah into Ajman.”

The hotels are not due to open until 2013, but Grub explains 2012 will be vital in developing the marketing and operational set up.

In addition, Grub reveals: “We have four or five properties in the pipeline where we haven’t signed management contracts yet but we have letters of intents out, so we will have a very busy 2012”.

There are also significant refurbishments underway at existing properties, which Grub says form a critical part of the business strategy.

“We as hotel operators advise the owners when to renovate, because we are the market drivers. We know when to renovate, because if you don’t renovate, you get stagnant. And stagnancy means you pull back. Not renovating in today’s market environment means losing out.

“We have renovations going on for instance at the Sheraton Dubai Creek, we are renovating half the hotel, plus some food and beverage outlets. At Sheraton Jumeirah we are renovating some food and beverage outlets, as well as rooms. The Le Méridien at the airport is building additional rooms and renovating the function space,” Grub reveals.

F&B upgrades are important because of the contribution the department makes in terms of revenue, continues Grub.

“I can tell you food and beverage is a very, very big part of our business. On average, you can say about 45% of our business comes out of food and beverage from our total turnover. In some hotels, we do more F&B revenues than we do room revenue even running 90% occupancies.

“That is different to most markets — but don’t forget hotels are still social and civic centres in this part of the world. Here in Dubai, if a hotel doesn’t have four or five outlets, it is not a five-star hotel,” he says.

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Service and staff
Business may be on the up for 2012, but that is not to say that Dubai is without challenges. As travellers increasingly seek both value and personalised service, Grub says it’s time to push service standards back up in Dubai.

“I believe that over the years, as a destination, Dubai hotels have really slipped in providing customer service,” asserts Grub.

“We came from a very high plateau, where we serviced a customer, where customers were in abundance, and off we went, it didn’t matter that much, then all of a sudden — over the past few years — people cut expense, cut costs; naturally so. Because we did not lose that much on occupancy if you think about it, where we lost as a destination was rate and rate manifests itself straightaway in the bottom line,” he explains.

The solution is simple, and it comes down to “really listening to your customers”, says Grub. “And really — and I’m not telling you something new — if you’re really customer focused, you will do well. And I believe it is all to do with customer retention, and really focusing on the customers’ needs — we have repeat customers, we know who that customer is, their likes and dislikes.”

This approach should be taken with all guests, at all types of hotels, continues Grub.

“Let me put it this way; as an individual, regardless of whether you stay in a super deluxe hotel or whether you stay in an apartment building, you still want to be treated [as if you are] special.

“You may not get that silver spoon, you may get a stainless steel spoon; instead of a crystal glass, you maybe just get a regular glass — you get what you pay for. But you still want to be treated as the individual from wherever you came from. This is hospitality — it has nothing to do with stars and brands and rankings.”

The right staff is pivotal to achieving this, acknowledges Grub, who is set to start recruiting management for the new properties in the first quarter of this year.

“Recruiting is probably the most important process you undertake because there you are selecting an individual who is the stakeholder of your business.

Regardless of whether that person works in a guest-facing or non-guest-facing position, that individual will interact directly or indirectly with the customer — unless these people know perfectly well what their objectives are, what their tasks are supposed to be, how it affects the stay of the customer, or how it affects the organisation overall, if you cannot do that, then you have a challenge,” says Grub.

It is more than making staff aware of their responsibilities, he continues, it is about monitoring their interaction with guests and “really making sure” your team understands the impact they have. Put simply, it comes down to empowerment.

“You have to have a good empowerment process…and continuous coaching going on in order to achieve that objective,” says Grub.

And with that, Heinz Grub is off for, you guessed it, a team meeting; missing out on those Dubai boom years certainly hasn’t dented this hotelier’s passion!