Hope is Not a Strategy
Before modern technology, ships set sail using only stars to guide their path. Even on a cloudy day, ships still have a guiding point like a compass or landmarks. When you are lost at sea, aside from the mental and physical obstacles you need to overcome, you must deal with the possibility of collision, cargo management, timely delivery, and cost control measures. Without a guiding star, where does the ship end up? The same can be said about having a proper mission statement for your hotel.
Mission statements serve the purpose of keeping all departments on the same page when it comes to challenging decision making. It ensures that everyone remains focused on the targets even if it means saying no to a client or yes to a crew. You want your mission to convey the ultimate goal and be easy to understand across all departments. There are a few good key elements you want to ensure you incorporate.
Be clear and concise so that it is easy to understand at a glance.
Ensure it is inspiring to evoke passion and motivation from the team.
It needs to be action-oriented and clearly state what you do and how you plan to do it.
Make sure it is future-oriented, outlining your goals and aspirations
Take a moment to pause and think through your current strategy. Ask yourself, do I have strategic direction? Does the team know that direction? Do we make sound, data-based decisions to steer that direction? I am guessing you answered no to at least one of these questions.
To get started, let’s look at a few data points. The idea is to keep is simple and high level and not to drive into the minutia. Take a moment to gather a few reports before reading further. To keep it simple, start with your most recent monthly STR, a mix of business report, length of stay reporting, and an industry market demand tool. Other reports to consider could be future group bookings, room type analysis, or your budget.
Starting with your STR, it is necessary to understand your performance in occupancy and ADR by day of week. This is a great place to start because you can determine where you need to focus your growth efforts. If you are selling out every weekend, then grow ADR on the weekends, but if you are failing to meet 100% share in occupancy on Tuesday and Wednesday, then work to gain weekday occupancy. This one piece will likely be the start of your mission statement.
Keeping with STR, you want to understand your seasonality. Seasonality is important as it may require your mission statement to be broken into multiple pieces. A great example is a market where it can snow heavily in the winter yet have beautiful summers. You are not driving the same demand in the winter as you might in the summer.
Following seasonality, you will want to gather details on your mix of business, length of stay patterns, and market demand. Look at a broader picture, not just a week or two but look at your averages over 90 days. You will want to break this down by weekday/weekday at least. If you have seasons, then make sure you pull multiple data points to encompass each season. It is important to understand where your opportunities are in each segment against what is available in the market. If you are an airport location, length of stay is not as important as a Residence Inn. Extended stay type hotels will want to include extended stay occupancy targets in their mission statements.
Now that you have reviewed all your data points, start to identify your opportunities and craft a mission statement. It can be as short as 3 words or as long as 3 sentences, it is about what will work for your team. Here are a few examples:
Grow weekday occupancy by improving negotiated mix by adding qualified accounts and targeted digital marketing campaigns for stronger group leads.
Grow weekend ADR by being more restrictive on group, discounts, and non-opaque segments and leave space for retail bookings. Ensure targeted marketing spend on brand and loyalty only.
Focus on group ancillary revenues in high season by ensuring we book groups with an F&B min of $XX, even if it means taking a lower room rate to secure the group.
Reduce extended stay occupancy to only 45% in high season by carefully evaluating in house extensions and new project business.
Once you have your mission statement in place, put that shit on everything. Each department is responsible for driving the mission to improve your overall revenue. Make sure it is discussed at the start of each strategy meeting to ensure everyone is focused on the same goal. If you choose a mission statement to reduce extended stay occupancy in peak months, you should not spend the entire meeting discussing a hotel buy out in June for $69/night. When this happens, circle back to the mission and reset the conversation.
Mission statements are valuable in business and in life. I encourage you to put some energy into developing one for your hotel next week. It is the foundation of commercial strategy, and a well-crafted mission statement is the guiding star your hotel needs to navigate turbulent waters. If you craft one, I am eager to hear what you came up with. Please share it with me in the comment section of LinkedIn. Join me next week for a game of “this, not that” where I will discuss how to replace current tactical actions with true strategic actions.
