Highlights: Sebastien Bazin, Chairman & CEO, AccorHotels - The Phocuswright Conference

Summary

The CEO of a 50-year-old, $7 billion company with 200,000 employees discusses the challenges of competing with agile businesses. He outlines five priorities for improvement: simplifying decision-making, embracing digital transformation, disciplined pipeline development focusing on cities, reevaluating the role of F&B in hotels, and changing management culture to empower younger, tech-savvy decision-makers who better understand future market needs.

Takeaways

• 🏢 The speaker is the CEO of a 50-year-old company with significant assets and a large workforce.
• 🚀 The company faces challenges from agile competitors and the CEO acknowledges the difficulty of the situation.
• 🛠️ Priority one for the CEO is to streamline operations and simplify the decision-making process.
• 💻 The second priority is digital transformation, which will be elaborated on later in the transcript.
• 📈 The third priority involves disciplined pipeline development, with a focus on being selective about which brands and countries to operate in.
• 🌐 The company operates in 95 countries, but profitability is heavily concentrated in a few, emphasizing the need for selectivity.
• 🍽️ The fourth priority is to reevaluate the approach to Food and Beverage (F&B) services in hotels, recognizing its potential as a significant business opportunity.
• 📱 The mobile phone and apps are changing customer behavior, with many opting for dining options outside of hotels rather than traditional in-house services.
• 👥 The fifth and most challenging priority is changing the management culture to empower younger employees who have a better understanding of future market needs.
• 🔮 The younger generation, particularly those under 35, are seen as better predictors of new services and offers, indicating a need for a shift in decision-making power.
• 🔄 The CEO recognizes the need for restructuring to allow for a more dynamic and responsive management approach.

Q & A

What are the five priorities the CEO has identified for the company?

The five priorities are: 1) Improving operations by simplifying decision-making, 2) Digital transformation, 3) Pipeline development with a focus on discipline and selectivity, 4) Recognizing the importance of food and beverage in the hospitality business, and 5) Changing the management culture to empower younger employees.

Why is the CEO emphasizing the simplification of the decision-making process as the first priority?

The CEO believes that simplifying the decision-making process is crucial for improving operations and being more agile against competitors.

What is the CEO's view on the company's digital transformation?

The CEO considers digital transformation as a priority but does not elaborate on the specifics within the provided transcript.

How does the CEO describe the company's current approach to international expansion?

The CEO points out that the company operates in 95 countries but notes a lack of discipline in expansion, with half of the profits coming from only half of these countries.

What is the CEO's perspective on the importance of cities over countries in the company's strategy?

The CEO believes that cities matter more than countries, as they are the focal points of business and profit generation.

Why does the CEO consider the food and beverage (F&B) aspect of the hotel business as 'not a necessary evil'?

The CEO sees F&B as a significant part of the business, with customer reviews heavily influenced by this aspect, and believes it should be run as a separate and potentially successful business.

How is the mobile phone changing the F&B business according to the CEO?

The CEO notes that mobile applications are allowing customers to easily find dining options outside of hotels, which is impacting the traditional hotel F&B business model.

What is the CEO's stance on the current management culture and why does he want to change it?

The CEO acknowledges that the current management culture, dominated by older decision-makers, is not conducive to innovation and market adaptability, and he wants to empower younger employees who have a better understanding of future market needs.

What demographic does the CEO believe has a better view on what the market needs tomorrow?

The CEO believes that people under 35 years old, specifically Millennials, have a better understanding and can predict new services and offers more effectively.

How does the CEO plan to address the issue of decision-making power being in the hands of older employees?

The CEO plans to restructure the company to give more autonomy and decision-making power to younger employees.

What is the CEO's view on the importance of being selective with brand and country expansion?

The CEO stresses the need for selectivity in brand and country expansion, focusing on profitability and strategic fit rather than broad expansion.