This week’s lesson from Hotel Impossible is as old as the desert surrounding the featured Fortune Hotel and Suites in Las Vegas. It is a familiar tale of a hotel owner with zero hotel experience and the consequences of not having any hotel systems in place.
The added twist for this episode was that the owner, Mr. Chang, failed to hire anyone that had hotel experience. The result was a former branded hotel with 150 rooms being run straight into the ground. The saving grace was that the new GM knew he needed help and called in the Hotel Impossible team.
No Hotel Experience Period!
If you are wondering how you can run a hotel straight into the ground, the answer can be found in the host, Anthony Melchiorri’s discoveries which included:
Deferred Maintenance, No Checklist and No Hotel Systems
- Consistent cuts in operating costs and no investment in maintenance. This included the classic example of deferred maintenance on the roof which will ultimately cost a new roof altogether.
- Not hiring any staff including the GM with any hotel experience. The results were inevitable:
- Not having enough staff.
- 3 housekeepers cleaning 30+ rooms each per day (maximum should be 15) without any training, checklist or inspections.
- Stained and sometimes unclean linens.
- Smelly carpets.
- Stained bedspreads (flipped over to hide stains).
- Telephone placards with former hotel brand name on each phone.
- Alarm clocks flashing.
- Room designs and furniture from 20-30 years ago.
- An outdated lobby with no pizzazz.
- A banquet room unusable during storms with visible leaks in a half a dozen areas along with stained and deteriorating ceiling tiles.
- Bad online reviews of staff customer service and issue resolution.
In essence, the hotel owner’s inexperience and extreme focus on costs prevented him from realizing that the hotel did not have the hotel systems they needed to have a successful operation. This lack of knowledge/experience could also be found in the marketing and revenue management of the hotel.
What Hoteliers Can Learn
The owner was very fortunate that his new, young and inexperienced GM instinctively knew he needed to ask for help from someone who knew more than he did. Realizing you need help and being able to ask for it is something the owner as an entrepreneur should have done. Thus the first lesson to be learned is never be afraid to ask for help.
The second lesson is that every successful hotel makes use of different systems. Hotel systems vary but will include tools for preventive maintenance, housekeeping, revenue management, marketing, budgeting and training. The Fortune Hotel and Suites had none of these.
The third and final lesson from this week’s episode was the importance of knowing your particular market. Las Vegas has the finest hotels and staff in the world. If you are going to compete in this type of market, your hotel has to have a unique appeal. The appeal can be location, decorative, event driven or simply outstanding customer service.
The Fix for the Fortune Hotel and Suites
The fixes for the hotel included the usual room renovation model, a renovated lobby and the bringing in of consultants for basic hotel management, marketing and recruiting. With this help, the goal was to increase the hotel’s Star Rating. Anthony indicated that each increase in Star Rating could increase rates by 11%.
Of course the most important fix is the one that will take the most time to bear fruit. The GM’s inexperience and lack of confidence when it came to dealing with Mr. Chang was situationally tested. The test was obtaining funding for the roof. Although he did not manage to get a new roof, he did obtain operating cash to have it repaired.
I am positive that as his knowledge, experience and confidence grows, The GM will be able to show the increasing success in the hotel’s prospects necessary to manage the owner better.