Posted inHotelier Middle East

OWNER-OPERATOR RELATIONSHIPS: A question of trust

Guy Wilkinson discusses the trust issue between owners and operators

What if your owner doesn’t seem to trust you? It’s a nasty sensation that I guess all GMs face some time, whether it’s a squabble over some small decision taken in the heat of a crisis, or a prevailing attitude that casts a shadow over the entire relationship.

From your viewpoint: what’s not to trust? After all, here you are on your umpteenth posting as general manager, a veteran of bigger, more prestigious hotels than this one, admired by thousands of staff who’ve worked under you over the years and more importantly, vouched for by the major global hotel chain that you represent.

You’ve come up through the ranks from bellboy, waiter or room attendant and what the hell? No upstart hotel owner is going to tell you how to run things around here!

From the owner’s angle: you may think you are God’s gift to the hotel trade, but how can I trust that you’re not diddling me in a thousand different ways? It’s my money that built this hotel and pays for you and all your colleagues to work here, so I’m damned if I’m going to let you spend it all without keeping tabs on things! Why is X costing us so much?

Why haven’t we earned more from Y? Who told you you could implement policy Z without my permission? You can see how the situation could reach an impasse before anyone knew it.

That’s one of the main reasons why management contracts exist – to provide a clear legal and administrative framework for owner-operator relations. Operators seek to include the famous ‘no-interference’ clause.

It effectively says that the owner should back off and let them do their job unhindered, because after all, they are the experts. Fair enough.

The owner will counter by specifying limits to decision-making and spending authority that bind the GM to obtaining the owner’s sign-off at important junctures. These include, most famously, the annual budget, when all financial parameters including spend ceilings are defined.

Any experienced GM or owner will tell you, however, that matters progress well beyond such legal definitions as soon as the realities of day-to-day operations kicks in. The question is, how can each know what is really in the other’s mind?

Mind Readers
One increasingly popular recourse for owners is to hire an asset manager or owner’s representative who is a former hotelier — ideally a former GM. Then the actual GM of the property is really in trouble, as both parties know the secrets of the Magic Circle!

But normally, the fact that two such professionals can speak the same language is an advantage, as there is also a level of mutual respect that prevents the owner’s man from breathing down the GM’s neck, even if he does keep him or her on his or her toes.

And that’s really the secret — respect. Both parties have good reasons to expect to be respected. The only way for one opposed position to approach the other is through empathy — through each putting themselves in the other’s shoes.

From the GM’s side, he must ask himself, how can an owner ever truly judge the efficacy of operations, unless his has had the same operational experience as each of the employees? He never can.

Owners are mostly not hoteliers and so can at best obtain only the perspective of a ‘gifted amateur’. It must be frustrating for them. But that doesn’t mean they can’t get an accurate feeling that something’s wrong, even if they don’t actually know how to pinpoint the problem. That owner’s sixth sense should be respected.

Owners must in turn realise that even the GM can never know at all times exactly what is happening everywhere in his or her hotel. The GM relies equally on a pyramid of trust that cascades to department heads, supervisors and line staff — the latter being ‘ambassadors’ of the hotel and thus empowered (i.e. trusted) to represent its service and moral values to guests as a basic facet of their job description.

In fact a hotel is nothing less than a complex network of trust. A grasp of this basic truth will go a long way to making the relationship between its two top people both less contentious and more productive.

About the Author:
Guy Wilkinson is a director of Viability, a hospitality and property consulting firm in Dubai. For more information, e-mail: guy@viability.ae