Andersen

05/30/2001  

Leveraging New Technology and Attracting Talent Seen As Main Challenges Facing European Hotel Industry

September 11 and 12 saw CFO's from many of the major hotel companies converge on
the Westin Hotel Versailles, France for the 3rd Annual European Hotel CFO Forum.
Delegates at the Forum represented almost 1,000 operating hotels across Europe.
With twenty-four hours of discussion and debate, the group explored the key
drivers of success for the industry.  Sadly, the Forum was held on the very day
that terrorists attacked the USA - however, the Forum was able to provide an
opportunity for the delegates to collectively begin the painful process of
addressing the business issues arising from this tragedy.

In a survey of delegates, 87 percent stated that the most important subject
facing the industry was the challenge of creating sustainable and profitable
models for trading in the New Economy, to deal with the following issues:

·    Changing nature of the customer
·    Changing nature of product competition
·    Ability to attract available capital
·    Dis-intermediation of traditional booking channels.

This year saw delegates switching the priority of the two most important issues
facing the industry. As well as discussing the New Economy, delegates also spent
considerable time debating the industry's "war for talent" voted as the second
most crucial issue. This issue relates in particular to an evolving finance
function which, in addition to technical accountancy competencies, now also
needs to provide financial leadership to the business.  The industry needs to
recognise the new competencies that the finance role now requires when
recruiting, developing and retaining talent.  The need for competitive
remuneration, clear career prospects and a corporate culture that embraces
talent, were other important components debated by the delegates.

The delegates also agreed that technology was the main change agent to deliver
customer expectations and that significant breakthroughs were still required in
the areas of Application Service Providers, CRM, broadband communications and
wireless technology. They also discussed the challenges in quantifying the three
different components of a hotel's value - brand, operator and asset owner.
Consideration was given to the issue of branding in the 21st century of the
global hotel industry.

Commenting on the Forum's conclusions, Ian Graham, Director of Hospitality
Solutions at Andersen said:

"The CFOs who attended this year's Forum remain concerned to find and apply the
right business model for the differing e-commerce offerings that are becoming
available.  We are in a period in which technology is enabling major change in
processes.  Many in the industry are clearly eager and willing to embrace the
new technology, but there is widespread recognition that change only happens
successfully through people in the business buying into appropriate behavioural
change. The most important group of people for whom behavioural change is going
to be critical is the customers and intermediaries who use the different
products and services offered by the industry.  Building intelligence about
customer attitudes and expectations is going to be critical in ensuring that the
technology, process and business model changes that we will see implemented,
deliver the potential levels of value to all stakeholders."

Co-host Hans Lindh, Head of Hotel Industry at American Express Establishment
Services added:  "The twin issues of attracting talent and reaping the fruits of
new technology were again identified by the Forum as the two main challenges
facing the industry.  Talent is required to leverage the benefits that the new
technology can provide, ensuring pay-back on these significant investments.
More fundamentally in an environment were all stakeholders - employees, guests
and shareholders - have become more quality conscious, the industry needs to
attract, retain and develop talent in order to deliver on its core proposition:
customer service.  The fact that these issues are contemplated by the CFO
community not only underlines their significance to the industry, but also
illustrates how the finance role has evolved from one focused on accountancy to
a strategic leadership role."

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About Andersen

Andersen is a global leader in professional services. It provides integrated solutions that draw on diverse and deep competencies in consulting, assurance, tax, corporate finance, and in some countries, legal services. Andersen employs 85,000 people in 84 countries. Andersen is frequently rated among the best places to work by leading publications around the world. It is also consistently ranked first in client satisfaction in independent surveys. Andersen has enjoyed uninterrupted growth since its founding in 1913. Its 2000 revenues totalled US$8.4 billion. Andersen refers to the brand identity adopted by member firms of the Andersen global client service network. Learn more at www.andersen.com.

For more information, please contact:

For Andersen:
Ian Graham
Hospitality Solutions
Tel: 44 20 7438 5045

For American Express:
Hugo Foulds
Establishment Services Group
Europe Ltd
Tel: 44 20 7976 4513

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