David Collins, columnist and Co-Founder/Director of Communications at Great National Hotels & Resorts discusses why entrenchment is one of the biggest barriers to success in business..
So here’s an interesting – abridged – quote from Jeff Bezos, Amazon’s founder, chairman, CEO, president, Master of the Universe, etc. ..
“I observed people who are right a lot and I noticed a few things about them. People who are right a lot, they listen a lot. And people who are right a lot, change their mind a lot. Changing your mind a lot is so important. Sometimes you get new data, and when you get new data, you should change your mind. By the way, sometimes you don’t get new data and you just re-analyze the situation and you realize it’s more complicated than you initially thought was, and you change your mind. Anybody who doesn’t change their mind a lot is dramatically underestimating the complexity of the world that we live in.”
Two years ago I wrote an article citing the madness of BREXIT (www.hotel-industry.co.uk/2017/06/brexit-lemmings-cliffs-etc/). It provoked quite a bit of reaction, both positive and negative .. largely the latter.
This was after all ‘a democratic decision’ – albeit marginal at best and founded on mistruths at worst – but nevertheless ‘one that should be both respected and implemented’. Roll on two years and where are we?
Aside from a lot of air miles between London and Brussels, cabinet resignations, volumes of click bait and distraction on a global scale, it’s pretty much stalemate whilst economic uncertainty has escalated, consumer confidence has tanked and business investment stalled.
(Granted, the UK hotel industry has seen a surge in domestic tourism aided by a weak GBP£ however it’s a moot point whether or not this is sustainable: mortgage lending and house prices are always good indicators of consumer sentiment and both are under severe pressure. In Ireland, inbound tourism from the UK – which has in the past accounted for up to 40% of Ireland’s international tourist demand – has simply collapsed. Curiously it’s something no one is talking about enough said on this for now.)
And yet if the powers that be had the courage and wisdom to become less entrenched, to stand back, assess the facts and reconsider their position, perhaps this could have saved all of us from the current mess that is BREXIT.
Entrenchment is similarly one of the biggest barriers to success in business. In fact one of the most fundamental challenges we face in business is not what customers do but what companies don’t do.
By sticking to ‘tried and trusted’ ways of running hotels without standing back and realising that there might .. just .. be .. a better way of doing things is an approach which eventually catches up with you. Indeed if you’re not moving forward in today’s tech/AI-fuelled world, you’re not even standing still.
Take rooms revenue management as a case in point. This should be at the heart of every hotel business and yet, it is obvious that some operators are stuck in a rut, preferring instead to rely on overly manual systems and a personal hunch when deciding how, when and indeed if, to move rate.
What’s astounding is that with all the available technology now available including competitive price transparency like never before, hotels are still reluctant to take a more proactive, dynamic, data/intel-led approach to managing yield.
Why? Well, for a number of reasons. Obviously some hotel operators might feel threatened by adopting a new way of doing things, they may have internal resistance from staff for example and this is understandable, after all we’re still a predominantly ‘people business’.
Equally, service providers in the area of rate management can often send confused messaging underpinned by fee models which are not perceived as being commercial enough to buy into. As a result, it’s simply easier not to change your mind – and your business practices – and continue to bury the proverbial ‘head in the sand’.
So is it tenuous, the link between BREXIT and managing a hotel’s rooms yield?
Probably! But not entirely.
BREXIT has illustrated how an unwillingness to realize and change a simple yet flawed decision can paralyse an entire economy; in the same way, a business will become mired in a state of self-imposed under-performance unless management has the courage to challenge itself. And ideally on an ongoing basis.
Remember, it’s OK to change your mind, it takes gumption but successful people – and businesses – do it all the time.