The Art of Balancing People, Profit and Progress
By Rick Gabrielsen, President, Kupuna Hospitality, LLC
The canvas of business, whether by drawing, paint or doodled upon, is one of balance with a variety of color, shapes, size and movement. The important aspect in starting the "art" is to determine the location for when the instrument touches the fabric. In a delicate stroke or the large brush of a foundation, the art of balancing people, profit and progress begins. Often confused with who or what comes first is the dilemma that each hotelier faces on all levels in an organization.
The training of an artist or sculptor is through dedicated education whether in a classroom or by a mentor, but is always through interpretation of words by a voice or on a page. This is where we start with the people portion of the equation. People are the providers of a service to others through all experiences. It is the progress of people in achieving profitability, thus the beginning is through the person. Your interaction with the person through training, education, mentoring and continual review allows the person to penetrate barriers and overcome obstacles. These could drive immediate results, capture relationships for the future but certainly progress the conversation towards profitability. In referencing back to the canvas, the artist has an idea of what the piece when finished will be worth. Whether it is a monetary objective or a marketing tool, the art will generate interest in all three phases of balancing people, profit and progress. With the artist's creativity in a finished product, it is not unlike a salespersons dream to start, work and then close the deal. The person in the piece has value of passion, creativity and completion. The person is the one that creates, completes, intervenes, changes, improves and etc, on the progress of profit! Allow them to act through the criteria set forth in your organization and the results will follow. Results are the outcome of a person's contributions towards progress, just allow them to progress!
Now that the art has the foundation sketched that will be acted upon to create the burst of color, we view it as progress. Just the word progress is important in the movement of nature. I once heard an individual tell me that "even when you fall on your face, you are moving forward", now that is a terrific difference in perception of improvement, but nonetheless it strengthens the point of balancing people and progress. The color of the piece is parallel to the marketing of a product in the variations of price, accommodations and revenue attainment. "SMART' goals are so basic to any progress to determine the outcome, even if the business is not to pursue it further. Many times this process should be adjusted by the individual that is progressing the product to profitability.
Let's look at the similarities in a larger canvas or as we will now refer to as a room block, a blast of color or as we will now refer to as revenue and the palette that will now be referred to as accommodations.
Canvas and Room Block
The canvas is the tool to articulate the features. The room block is recipient of the benefits. What are your features? Who will benefit? Is there a template you can create to follow in a conversation? Using this tool to articulate your product will be the benefit to the customer. Adjusting the tool in the sales process will reap many rewards in the obtaining the room block.
Color and Revenue
The color is an emotionally featured visual. The revenues become a relationship. How can you build an emotionally charged visual in the process? Will it be in a brochure or a video? Will it include testimonials from previous guests? Is it best to showcase three or five important facets of your hotel or more?
Palette and Accommodations
The palette is the carrier. The accommodations are our product. The person is the communicator of the product in various displays. Showcase the product suited to the buyer. The room, suite, conference room or the "building" is the accommodation that sets the stage for further conversation about the relationship in wants and needs.
So now we have found that the person moves the progress, but how does the profitability get intertwined into the art. Balancing this piece is experience in the sale. The sale of one or a million always provides the emotion of the profitable sale. If we all were in a not for profit environment, we could determine how the income is spent, but in the hospitality business it is all about the progression of results to further our potential income to improve profitability. These results can be in market penetration, year over year growth or margin improvement, increasing incremental dollars that float to the bottom line or doing more with less. But the only result that matters is to improve revenues so that profitability is progressed.
Typically the operational expenses have fixed costs or those associated with key indicators that become static when you have zero based scheduling and just in time inventory, so it has to come on the top. One associate mentioned to me years ago in a discussion on revenues and expenses and profitability, that "There is a bottom line in controlling expenses, but never in improving the revenues, as the sky is the limit".
Cutting expenses, saving payroll and reducing sales efforts comes with a price in quality that will have a far greater impact on the additional revenue and profit. Let's think about a simple equation for a moment: Let's just say that a typical hotel runs occupancy of 70% with a rate at $100 equaling a RevPAR of $70. How often do you justify the $300 expense for advertising or the bonus paid for a group? Have you ever looked at it differently to say all we need is 4 more room nights to pay for the advertising or bonus? Not likely in my years in hospitality, it is always about the guts of the operating statement and not about the improved revenues. Revenues will only drive profitability, expenses will only reduce profitability!
So back to the art of balancing people, progress and profitability. If you desire additional revenues you need to take care of the communicator, the people. If you desire the progress, you need to balance the designer, the people. If your goal includes improved profitability it is imperative that the balance of the brush with the canvas along with the color all play a part in the value of the display. In your next meeting with the entire group or just a one on one, I ask that you play a bit of ping pong to determine the following which will provide you the next steps in the balance of these three segments of business:
• Will your visual be a blast of color or words to highlight your emotions and features?
• Will the tapestry in the story of your hotel sell your product?
• What language will you use to promote your hotel? Is it a testimonial of the past or future?
• Have you discussed with your team the balance of people, profit and progress?
• Is there a basic flow chart of the balance in price, perception and profit?
• Is value placed as much on the progress as the sale?
• Is a reward or incentive in place that is clear and achievable in producing revenues?
• How will you be recognized for performance?
• Will the foundation of your sales efforts be one without the person and all technically displayed without a voice? How will it appeal to the buyer?
• Who is your designated communicator to the buyer? Are they equipped to immediately adjust and create?
• Will your audience sell or buy your product?
In previous articles that I have written, each one starts with a person who is the driver of results, Not unlike in "Creating our Own Leadership Values" or "Creating a thread between team members and guests in our green efforts" it begins with each of us. Barriers can be toppled, mountains can be climbed, records are made to be broken and people are born to progress. It begins and ends within YOU, which is the foundation or piece of art. Will you be the one to balance the palette and create the piece, will you be the one that stimulates the customer's emotion in the piece or can you be the one to promote and sell the finished product. Whichever you do, do it with imagination, as the art of balancing people, progress and profit is in the results of your contributions. Let the canvas respect the art, provide the passion it intends and the price to be profitable. Without a sale there is no profit, without a person that is no communication and without features and benefits there is no sale.
May your palette be big and bright, and your progress consistent, with highlights of profitability for the future!
Passionate involvement and infinite horizons are what defines Rick Gabrielsen — be it as an industry leader admired by his peers for a reputation of peak performance, a trusted advisor and loyal business partner, or a compassionate community volunteer. With 35 years experience in hospitality management for a variety of corporate, independent and bank owned hotels, he is one of the foremost experts in asset management and operations of boutique hotels and limited service properties. Prior to forming Kupuna Hospitality, Mr. Gabrielsen held the position of Area Vice President for Hilton Worldwide, managing company-owned and or managed brands of Hampton Inn, Hilton Garden Inn, Homewood Suites and Embassy Suites hotels in the Mountain — West region and Mexico. Mr. Gabrielsen can be contacted at 303-376-6313 or rick@kupunahospitality.com
