Transitional Management

Managing the Board and Employees During Strategic Change - By Petra Deuter

American management guru Gary Hamel coined the notion of strategic decay: every strategy, no matter how brilliant, loses its value with time. Change is inevitable and essential in any organization. A business which does not embrace change is stagnating - a principle which applies as much to the hospitality business as any other market sector.

HTrends With the struggle to survive in a challenging financial environment, many hotel and resort operators find it difficult to focus on and implement key policy changes, however much they are needed. This article examines how these businesses can successfully drive and manage strategic change, at both Board and employee level.
 
Insight and foresight
Strategic change managers require many skills and qualities. They need insight: an objective, global view of the business’s current performance, the strength of the competition and the market potential.
 
They also need the foresight to distinguish the desirable from the achievable.
What does the hotel or resort really need? Is it a quick win or can the business wait to see a return on its investment? For many of the parties involved, the quick win may look more attractive, but a good change manager knows expediency does not always go hand-in-hand with sustainability. Any proposal should aim to build the brand, as well as the business.
 
Finding a change champion
So already we’ve established that the strategic change manager needs astute financial and operational judgment, and the ability to create viable, visionary business solutions. But this is only half the battle.
 
To translate vision into action, they should also be a change champion. Strategic change may challenge the business’s current plans and conventions; I know from my own experiences of leading change programs that a change champion will need finely tuned interpersonal skills to persuade Board members, employees and shareholders to sign up and support it.
 
The strategic change manager should be decisive, honest and clear. It’s important to communicate at each level – Board, employees and shareholders – conveying the plain facts using language the people involved are familiar with, avoiding jargon or spin. Faced with potentially career-changing developments, they will want a clear explanation of how they can benefit from helping the project succeed, what would happen if it fails and the input required from them. To bring everyone on board, the change manager needs to be passionate and articulate, and capable of maintaining this level of communication throughout the change period.
 

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Seeing it through
A strategic change manager is naturally a leader, instigating original and even radical ideas that create and exploit opportunities. Like all good leaders, they should inspire by example – passing on their knowledge, and encouraging others to contribute. Employees can be incentivized, by offering training that will support their career progression as well as facilitating the project, and if appropriate, using bonus schemes that reward them as the project reaches each landmark stage.
 
If the business’s present structure hinders change, the change manager will need the confidence to take difficult decisions: overcoming resistance, resolving internal conflicts and if necessary, thinning out overstaffed departments or removing those unable or unwilling to accommodate the new policies. They’ll also be adept at identifying and recruiting talent, from within and outside the business, bringing in the finest quality candidates to help achieve the strategy’s aims. They should also demonstrate a commitment to the future of the hotel or resort, by setting up a succession policy that secures business stability.
 
The change programs I have been involved with have highlighted the importance of managing expectations. It’s important to explain that the benefits of strategic change may not be seen straight away; the Board, employees and shareholders often expect change managers to deliver rapid results. Their expectations can be unrealistic, but the wise change manager appreciates that the project can only be deemed a success when all parties are satisfied.
 
Choosing the ideal change manager
Any hotel business with an executive manager possessing all these qualities, plus the time to take on a strategic change role, is very fortunate indeed. Of course, this person will know the business and competitors well, and can ‘hit the ground running’.
 
However, it’s highly likely such a talented person will already be fully utilized within the organization and won’t have the additional capacity required for this demanding task. Diverting them from their existing duties could be disruptive and possibly counter productive. And co-workers may find it difficult to accept them in the new role, especially if they are personally affected by the change manager’s decisions.
 
Keeping your options open
Alternatively the business can call on external resources. This could mean recruiting a new manager, or bringing in an expert to coach a suitable existing employee, who will become the strategic change manager. This second route is time-consuming, but has the advantage that the employee has a thorough understanding of the business and, even after the change process, will be an asset to the organization.
 
Another option, which offers several benefits, is to hire a consultant or interim manager to implementing the strategic change. As an independent expert, they can make wholly objective decisions, divorced from company politics. Their recommendations will be focused on the business’s priorities, not clouded by career considerations. And they will be able to bring the specialized skills and devote the long hours necessary to see the project through.
 
Pierre Wack, who pioneered the use of scenario planning, maintained that planning for change was not determined by formal analysis and statistics, but by insight, complexity and subtlety. There are many uncertainties about strategic change; the only sure fact is that, sooner or later, your hospitality business will need to deal with it.

 
 

Author, Petra Deuter,
is founder and owner of PD-Hospitality Consulting and Interim Management, www.pd-hospitality.com, and is an independent advisor and transition Executive who specializes in the hospitality industry, with a strong track record of growing revenues and managing strategic and operational changes. She is an expert advisor and mentor, with many years’ management experience in Europe and North and South America. Petra can be reached at pad@pd-hospitality.com.



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