Hotels offer interesting material for business architecture because its business is quite unique and if the business is unique the organization will be too. Besides this, the architecture of one business may and often will serve as an example for another sector. In this case, hotels are set as examples for hospitals, which have only recently turned into a more client focused approach.
NH Hoteles is just an example of a (large) company in the hospitality business. NH Hotels uses a motto, "Eye for detail". This is where hospitals can still learn in their shift to client differentiation. Another interesting detail about NH is their Short Story Award: "each year, NH Hotels organizes a new edition of the most important short story prize in Spain in order to provide our guests with an exclusive choice of bedtime reading and to promote short stories written in Spanish and new literary talents. For the first time we have included a new category of short story written in English" (1)
One way investors benchmark Hotels is by examining the revenue per available room (REVPAR). This is an important aspect of the business. Hotels do not produce anything, instead they offer facilities like rooms that are "available." Just picture yourself carrying a heavy bag at night and you find a first hotel, but with the sign "complete." That is the challenge for the hotel business; matching available rooms with clients in a profitable way and for both, also on the long term. This again, resembles the airlines business where "seats" are the equivalent in the matching process.!
Offering rooms can be done in many categories.
Accor Hotels, a French Hotel Chain, has segmented its business in a pyramid of increasing luxury (room) services: the formula-one hotels adjacent to the toll-highways are an example of the more ordinary "formula," in between are Mercury and Novotel and in the most luxurious segment there is the Sofitel-brand.
That is another part of the hotel business architecture: the distribution of brands. In the financial business it is more easy to use a single brand. In the hotel business this is more difficult, because of the physical location that is linked directly to the brand.
Hotels are continuously redefining their strategy which changes their business focus. The same Accor for example sold their stake in Club Mediterranean and Carlson Wagon-Lits because they don't fit any longer with the strategy. Club Med. is led by the son of the former president of France: Henri Giscard d'Estaing. Club Med. is part of t! he Hotel and Recreation sector but is completely focused on re! sorts wh ich is a niche market. Sol Melia is another Spanish company in the hospitality business. Interesting about this company is that it is a family-run business. What stroke me was the accessibility of their website. Accessibility is important for the hospital business, and a well designed site is a first indication that the hospitals are also accessible.
A different view on hospitality is also possible. Then you have to think again about the secondary requirements. As NH Hoteles sponsors a literary award, to offer "an exclusive choice of bedtime reading," other companies have quite a different focus. In Las Vegas for example, the hotel is merely a stop on the road to gambling. This leads us to a formula offered by Wynn resorts. Wynn is traded on NASDAQ and has currently two locations: Las Vegas en Macau.
to be continued...
(1) - www.nh-hoteles.com
© 2008 Hans Bool
Hans Bool writes articles about management, culture and change. If you are interested to read or experience more about these topics have a look at: Astor White. On thi! s site you will find more about business architecture.
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