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Strategic Direction Part 2: How to Develop Strategic Planning Last month, we reviewed why it's important to have a plan and the difference between a strategy and a tactic. After developing strategic directions for many hotels around the world, I've developed a 5-step process that will ensure everything is considered and included in the creation of a solid plan for everyone in and affiliated with the hotel. Step 1: Review the Past Before determining the best strategies, it's necessary to review the past to understand the hotel's successes and what could have gone better. This takes honest and candid discussion to get behind the real issues and goes deeper than a surface review that potentially protects poor implementation or a downright bad strategy. It's also important to acknowledge a great strategy that got sidelined due to circumstances beyond the control of the leadership team. Natural disasters such as hurricanes, wildfires and earthquakes affect hotel performance, are impossible to predict, and often take a long time to recover from. What was the best performance year for the hotel? What happened during that year and how did the hotel leverage that opportunity? Was it a one-off situation or can it be repeated? Look at the business mix (group versus transient) and dissect each individual market segment to identify why it was such a terrific year. This is a time to step back and, together with the team, review previous years' data and learn from past successes and failures. Step 2: Know Where You Want to Be in the Future Armed with this information, identify where you want to be in 3 to 5 years. What will success look like? What is the big-picture, long-term view of where you want to go? Pick a timeframe - 2, 5, or 10 years, or anything that works for you—and determine the goal. Move from 60% group to 75%? Develop further data analysis to validate the goal. What is a realistic timeline to achieve this goal? What is the 'gap plan' to get you there? Step 3: Do an Internal Assessment Take a real, honest, and objective look at everything within the walls of the hotel. In assessments I've been involved with, conducting the internal assessment is often the most difficult task, as hoteliers often view the property through the lens of customer complaints and overlook positive feedback. Salespeople, too, often recite client objections, which can skew the overall perception of the hotel, to get a lower rate or better deal. Be sure to put this in perspective and get a balanced viewpoint considering these points:
Step 4: External Factors The hotel industry is unique; we can easily visit our competitors, assess what they do (or do not do) well and often, renovation plans are shared. In addition, it's easy to identify new competitors coming into the market and determine the impact on our hotel. External factors also cover social, economic, and political influences that can have an impact on the hotel. Changes to demand generators can also affect a hotel's performance—the arrival or departure of a new corporate office, completion of an airport expansion, or a new sports or concert venue, for example. Step 5: Innovation The final area, and one that often gets overlooked, is the consideration of out-of-the-box ideas. Once again, bring the team together and brainstorm on ideas and innovations that could take the hotel to the next level. Consider taking risks and then bring it back to reality to determine if the team is able to execute.
The above diagram factors in all 5 steps and highlights the importance of data as the platform for decisions rather than anecdotal information or emotion. The sweet spot (#4), where all 3 circles overlap, considers internal opportunities and constraints, what is going on outside of the building, and creative thinking that steps outside the traditional approach. |
When all 5 steps are taken together effectively, a transformational strategic plan is developed that even the most tenacious competitor will find hard to beat. |
"Strategy should evolve out of the mud of the marketplace, not in the antiseptic environment of an ivory tower." Take the Next Step Now Dramatically improve your hotel revenue by hiring Jo-Anne to:
If you would like to hear more, simply reach out to Jo-Anne at About Jo-Anne Hill Founded by industry expert Jo-Anne Hill, JH Hospitality Consulting dramatically improves revenue and profitability in creative ways at hotels around the world. Her strategic thinking, skill, and practical approach to problem-solving come from hands-on experience at companies such as The Ritz-Carlton Hotel Company, Four Seasons Hotels & Resorts, Mandarin-Oriental Hotel Group, Dorchester Collection and Shangri-La Hotels & Resorts. |
 
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