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A Special Supplement on the Occasion of the 10th Annual HICSA Conference, 2014, Day 1. 2nd April

Nakul Anand

Dilip Puri

Rajeev Menon

K.B. Kachru

The face behind all leading Industry Associations

100+ hotels across brands by 2015

Oversees dynamic Marriott development

Honoured with Lifetime Achievement Award

Cautiously confident about Starwood growth in India in the near term and bullish in the long term across its different verticals

Industry reposes faith in Anand as he steers his own company, ITC Hotels, towards responsible luxury

The Marriott Group has been steadily growing its different brands. Each of them is making its presence felt

Responsible for strategy and growth of Carlson Rezidor within South Asia, HICSA recognizes his contribution to the industry

LANDMARK 10TH HICSA, STAR-STUDDED, OPENS TODAY

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s HICSA completes its momentous journey through a decade, we are extremely glad to have everyone join us for the 10th Anniversary of this conference. We thank our delegates, speakers and supporters for their patronage and for making the conference the unique platform that it is, to explore growth and investment opportunities both within and outside India. This year, too, we have a stellar line up of speakers and global CEOs who continue to believe in the India story. There are about 500 delegates from across the world attending the conference. Though this year witnesses a slight decline of about 7-10 percent in the number of attendees, owing primarily to the election season and the general slowdown of the Indian economy, the line up of delegates remains spectacular. Accor, IHG and Carlson - counted amongst the three largest hotel companies in the world - are represented by their senior-most leadership teams. We also have the CEO of Jumeirah

Diana Nelson is 3rd generation head of Carlson, here at HICSA

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iana L. Nelson assumed the chairmanship in May, 2013 and marks the passing of leadership to the third generation of the Carlson family, being only the third person to serve in this capacity in the company’s 75 year history. She is preceded as chairman by her mother, Marilyn Carlson Nelson, and her grandfather, company founder Curtis L. Carlson. In addition to her role on the Carlson board, she serves on the board of governors of Carlson Holdings, Inc., as well as on the board of directors for the Carlson Family Foundation and the World Childhood Foundation.

There are about 500 delegates from across the world attending the conference. Though this year witnesses a slight decline of about 7-10 percent in the number of attendees, owing primarily to the election season and the general slowdown of the Indian economy.

– the largest hotel chain with in the Middle East and, now, making a foray into the global market as well. The conference has a good representation of people with nearly 22 percent being women and around 25 percent being Owners/Asset Managers who comprise the largest group at the conference and perhaps are (and always will be) the toast of the conference, given that brands, consultants and development heads all wish to actively network and foster business relationships with the Indian Owner! This year, apart from the usual Hotel of the Year Awards, there is an additional buzz and secrecy pertaining to which two hotels will be chosen for the Hotel of the Decade Award. With the three iconic Oberoi properties in the shortlisted 10 in the Luxury/Upper Upscale/Upscale space, could it be one of these? The Budget/Mid Market segment is also likely to see some stiff competition. Could the Lemon Tree in Goa be the surprise winner? Or will it be one of the mainstream brands? ■ Manav Thadani and Team HICSA

Sébastien Bazin, new Chairman & CEO, Accor, is first time visitor to India and HICSA

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ébastien Bazin, 52, an undergraduate from the Sorbonne University of Paris, began his career in the finance sector in 1985 in the United States. In 1997, he joined Colony Capital to install and develop from Paris the European branch of the private investment firm. Within 15 years, he managed and participated in a number of investments in the hotel sector, including the buyout of the luxury hotel chains Fairmont and Raffles, acquisition and Management of hotel assets from La Générale des Eaux, Club Méditerranée and Accor, acquisition of a stake in Lucien Barrière Group, and investment in Accor. Member of Accor’s board since 2005, he was appointed as Chairman and CEO of the Group in August 2013. Vice-Chairman of the supervisory board of the Gustave Roussy Foundation, Sébastien Bazin is also member of the board of Théâtre du Châtelet since December 9, 2013.

WISHES DELEGATES AT 10TH HICSA THE BEST OF DELIBERATIONS AND NETWORKING OPPORTUNITY


02.04.2014

3 ITC Hotels : A Journey to ‘Responsible Luxury’, providing a new way to grow for the industry HICSA SUPPLEMENT 2014 HOTELSCAPES

It has been carving a niche for itself as an industry leader. Here are some ground rules as shared with us by Nakul Anand.

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hy Responsible Luxury?.... Responsible Luxury is an ‘expression’ of the times… In a fast paced ‘socially’ (I live on Facebook, Twitter, LinkedIn) evolving world, people are moving from a ‘ME’ culture to a ‘WE’ culture. Tribes and communities are sprouting up like never before, clustering together with like-minded people. These individuals believe that the evolution of the human race cannot be at the cost of the planet and its ‘natural capital’ Today…endorsements of products and brands are being viewed as a sign of individual expression… I can and will indulge but it has to be in a guilt-free manner…I cannot be guilty of endorsing a brand that either practises child labour or increases carbon footprint or degrades the environment or is not just / fair to its employees…I am willing to go that extra mile / pay that extra dollar if the luxury brand I endorse can indulge me in a guilt-free manner .

Our focus at ITC Hotels is to offer composite experiences in keeping with the emotional needs to travellers today, going beyond any one peg to meet the multiple needs be it Spa, Cuisine, Beverage, Kids entertainment, Well-being and care of loved ones etc. Guests today are looking for luxury experiences delivered in a ‘guilt-free’ environment. For a hotel chain whose lineage demanded a triple bottom line (economic, social and environmental) approach to business (ITC Ltd is the only company is the world of its size to be water positive, carbon positive and solid waste recycling positive) ‘Responsible Luxury’ is not a differentiator or a positioning statement…it is the only way in which we conduct our business. Yes, we were challenged at the crossroads (in 2009) of making the choice between luxury and sustainability considering that traditionally luxury and sustainability were seen as incongruent…however, recent trends indicate that ‘Responsible Luxury’ is

an idea whose time has come (Responsible Luxury at ITC Hotels is now a case study at Harvard Publishing).

NAKUL ANAND

Executive Director, ITC Hotels and Chairman, FAITH

“ITC Hotels is committed to delivering luxury experiences in ways that are socially and environmentally responsible. It is simply the right thing to do; and our customers expect and deserve nothing less.”

Nakul Anand steers industry in good FAITH Nakul Anand is also Chairman of FAITH which is bringing 11 industry associations under one platform to create a common voice for the industry.

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s a leading hotelier, how do you view the current hotel scene? There are many who remain very depressed, with many hotels put up for sale. Admittedly, there is an imbalance in the short term. Let us also not forget that this downturn has come after a long bout of success. We are now faced with a global recession. We believe this is short term and that the fundamentals are more than strong. India’s hotel industry has been grossly underserviced. We just have to look around us. A billion Indians make the domestic market and just a one percent share of the global traffic means 10 to 12 million foreign travelers. If we see the two streams, there is ample room for growth. Visa on arrival is for us a game changer for the industry as a whole. We believe travel needs to be simplified. India must become a travel friendly country, and we need to bring efficiency into the system. We need to create the pull for

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our tourism effort. In the last few years, what has been the effort like, and what could be a possible learning curve, if I may call it that? We have been talking all this while to the centre when most of the issues we are addressing are state-centric or state-specific. Therefore, much of our efforts have been futile. Understandably so. Now we have separated the two  – the centre- specific and the state-specific issues - and are  addressing them directly, as they merit. And how is your understanding of the hotel and tourism industry, in relation to the country as a whole? It is not a secret that what sells most today with all concerned – with governments and with the people – is economic  development. Till very recently, tourism had the elitist tag, and only now is its economic impact being discovered and accepted. The battle for power is being fought on economic issues and it is here that tourism will score. The topmost consideration is being given to the creation of jobs. According to government estimates, some 120 million jobs are needed by 2020 and tourism alone can account for 36 million. It is here that our efforts are being centred – that  tourism must be viewed more as an economic activity. But in this scenario, should not domestic tourism and travel be given the highest importance? Surely, but if you see air travel as the creamy layer, we are suffering most on account of high Aviation Turbine Fuel (ATF) prices. But here again, ATF is a state subject and we have

What’s trending at ITC Hotels in 2014… manifestations of ‘Responsible Luxury’ •  Regional Cuisines •  ‘WelcomMeal’ - Composite bespoke in-room dining experience, for One •  ‘Single Diner’ menus in  all restaurants Wellness to Well-Being •  Menus with ‘Calorie Meters’ •  Dial a ‘Well-being Chef’ •  ‘One Bite Wonders’ –  Healthy snacks without compromising Taste •  Tapping into ancient Indian culinary sciences – The  ‘Goodness of the Vedas’ relevant in the modern context •  ‘Caringly Sourced’; ‘Mindfully Prepared A shift from Wellness to Well-being – icons on menus  that indicate ‘good fat’, ‘heart smart’, ‘forgotten grains’ etc… •  Farm to Plate approach –  Locavore; Creating livelihoods •  Sea to Fork – Highlighting  the ills of overfishing – Leav-

ing the ‘Responsible Choice’ to guests •  ‘WelcomAqua’ – Natural  herb infused luxury water, created at ITC Hotels, served in glass bottles. •  ‘Green Banquetting’ –  Encouraging guests to choose responsibly. Creating bespoke options •  ‘Luxury of Sleep’ - “I can give you all the bells and whistles but if I haven’t invested in giving you good sleep, I have no reason to be in business”. •  Wellness – Internationally  acclaimed spa brand - Kaya Kalp. Winner of Tatler and Conde Nast Traveller-Best  City Spa award Hi-Tech Technology – Enabling the gift of time •  Welcom-e-Butler System at  ITC Hotels - Guest-friendly, secure, e-Butler enabled services on the ipad enabling in-room and entertainment systems control •  Warmth – The Guest Recognition technology enabling personalised experiences •  Mobile app for MICE facilitating pre, during and post event enhanced capabilities. ■

begun to tackle this at the state level, instead of at the centre. Goa has a most clever pricing strategy. The percentage of tax will depend upon the number of aircrafts that touch into the state. They have incentivised tax levels and created the pull for the state. And which states have you been tackling, so far and where do you look into the future? We have made presentations and engaged with the states of New Delhi, Maharashtra and Rajasthan. We are now  engaging with Uttar Pradesh and Arunachal Pradesh. How come this energy has emerged, and so fast? Frankly, much of this is the outcome of our presentation to the state tourism secretaries, after the centre convened this meeting for us. It has unleashed a new energy, a new momentum. But do you feel the change has happened? It is happening and it is most encouraging. It is there still, a mindset against tourism, seeing it as elitist. But we are grappling with it. Also, let us not forget that in the past, we have sent out a multiplicity of messages. We are pulling out the big issues, and directing them to where they matter. And what has been your success as FAITH? Very good to start with, I would say. There is a long way to go, but the mission is clear. We are engaging the world and the media at home and every policy-planner as well with some of the good that has happened. Earlier, we had some of the worst airports in the world, and now we have some of the world’s best. Visa on arrival is in the process of being implemented. We are engaging the media and giving them the larger perspective within which to look at tourism. We need a more effective PR effort for the industry. We are in the process of creating a crises team for the industry as a whole. ■ The above is excerpted from a recent interview in Hotelscapes


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Lifetime Achievement Award for K.B. Kachru, a befitting recognition of Carlson’s growth

India’s hospitality industry is known for creating leadership from among its own ranks. K.B. Kachru is one such notable example of having grown with the industry. HICSA recognises his contribution this year by honouring him with its Lifetime Achievement Award. We interview Kachru and capture his impressions on this occasion.

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hat does it mean to you to be so honoured? I am humbled and also feel blessed to receive this honour and recognition by the investment community and the industry. To what do you owe this success? This success is thanks to both Carlson and ITDC for providing me with the opportunities to contribute to the industry growth. My teams, all through my career have been a big contributing factor. And lastly the support of my wife, Neelam, who not only took care of the home front but also worked with me in both the organisations. If you were to play a role model, as somebody who has risen up the ranks, what is your advice to young hoteliers of today? I would tell the young hoteliers to be earnest, honest and committed. They must respect and accept opinions even if they are at a variance to their own. Accepting constructive criticism can humble you. They must make goal posts and objectives, and never ever give up till they achieve them. How has, if at all, the industry changed from then, when you started to now? The industry was in a nascent stage in early 70’s and there were few first class hotels only at select locations. Mid segment hotels were almost non-existent. The industry has since grown by leaps and bounds to what we see today. The Government has now given more recognition to the Tourism industry and the infrastructure, although still not adequate, has also grown considerably. Technology and the arrival of so many new international hotel brands has contributed tremendously to the quality of services offered and there is considerable improvement in the processes. What do you see as the future of the industry in Indiathe challenges and opportunities, both? As in the past, the future of the industry will also be largely dependent upon the political and economic environment as well as peace in the region. India has great opportunities for growth, especially in the Tier 2 and 3 cities and in the mid market and budget segments. I believe India is still under-served at many locations and there are huge investment opportunities available. The challenges are equally large. Infrastructure is still under developed at most locations and not of international standards. ROI in itself is a challenge due to high cost of debt and price of land. Availability of skilled manpower

ITDC is a Public Sector undertaking which was formed for the purpose of Developing tourism infrastuructre, particularly at locations where the private sector was at that time not willing to invest. Providing infrastructure at new and remote locations and job creation were the key objectives. Carlson is a global player in the area of franchising and managing Hotels. The main strength of Carlson in this market, has been its timely entry. Being a privately held company, we were able to take a long term view, which has now paid dividends. Strategic partnerships for various brands has helped to grow and consolidate the businesses over the years. ■

Carlson Rezidor Hotel Group to expand across brands

C K.B. KACHRU

Executive Vice President, South Asia, Carlson Rezidor Hotel Group

The industry was in a nascent stage in early 70’s and there were few first class hotels only at select locations. Mid segment hotels were almost non-existent. The industry has since grown by leaps and bounds to what we see it today. will also need to be addressed as a top priority. You started your career with an Indian chain, and have been working with a foreign chain for sometime – what do you see as the strengths and weaknesses in both, in their operations and approach to the business, in India?

arlson Rezidor Hotels has announced the launch of Quorvus Collection, a new generation of expertly curated luxury, five-star hotels that will offer a truly distinctive experience. Each will be individual in style, design, heritage, history and architecture and will be reflective of its location and culture through the Quorvus “Eidos” – an essential expression of each hotel’s individualism. Each of the Quorvus Collection hotels will offer a suite of hallmark services tailored to perfectly fit and completely fulfill the needs of our discerning guests. Six core lifestyle elements will embody this distinctive service suite, including The first of the Park Inn Hotels, with Bestech at Bilaspur

Wellness, Replenishment, Style, Inspiration, Entertainment and Connectivity. The Quorvus Collection has strong growth ambitions within the luxury segment and is expected to announce its first members in Q2 2014. Different by scale, architecture, ambiance and design, the future Quorvus portfolio will include historic landmark properties, contemporary residences, classic boutiques and urban retreats. Carlson Rezidor in collaboration with Bestech Hospitalities is developing 43 more Park Inn by Radisson hotels in India by 2024. As part of this agreement with Bestech, six hotel management agreements have already been executed in 2013. From now to 2024, the partnership will deliver an additional 43 new generation Park Inn by Radisson hotels in north and central India. At present, Carlson Rezidor is in the process of seeking a second strategic partnership to leverage multi-platform growth in India. Carlson has established its leadership in this market over the last 15 years. By focusing on building strategic partnerships with hotel owners, it has accelerated growth to deliver a record number of hotel signings in 2013. Its sustained growth in India is expected to ensure continued leadership in this important market. Carlson Rezidor Hotel Group has more than 1,300 hotels in operation and under development, spread across more than 100 countries. The hospitality group’s brands include Radisson Blu, Radisson, Park Plaza, Park Inn by Radisson, Country Inns & Suites By CarlsonSM. ■


Luxury Has A New Address In keeping with the tradition of the brand, Kempinski Ambience Hotel Delhi sets foot in the unexplored part of the city. What was once known as a quaint trader's settlement, now boasts of this luxury lifestyle complex. With 480 luxury rooms in two towers, 70,000 sqft of banqueting space, 3 specialty restaurants & a bar and a fully composite wellness centre, Kempinski Ambience Hotel Delhi is truly the new capital of luxury.

1 CBD, Maharaja Surajmal Road, Near Yamuna Sports Complex, Delhi - 110032 T: +91 11 4908 8751, 081309 90941, E: fb.delhi@kempinski.com www.kempinski.com/delhi Follow us on /KempinskiDelhi


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Confident of signing 100+ hotels across brands by 2015, growth and consolidation go alongside

Starwood Hotels goes a long way in India. They have now grown across their different verticals, including luxury Westin and are buoyant with the success of Aloft and Four Points by Sheraton. We interview Dilip Puri.

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ith the volatile economic environment and the depreciating rupee the ride for the Indian hospitality sector has been a bumpy one. However, for an international hotel operator like Starwood, despite economic challenges, the globalisation of business, rising wealth and a more digitally connected world make the recovery a “travel-intensive” one. We are cautiously confident about our growth in India in the near term and remain as bullish as ever in the long term.

capability, the power of its award winning loyalty program, SPG, and the strength of its brands offers great value. We therefore believe an arrangement between such asset owners and our management and distribution capabilities could be mutually beneficial and an opportunity for both. The short turnaround of the Four Points by Sheraton Ahmedabad and the Four points by Sheraton New Delhi Airport Highway conversion highlights the agility of Starwood’s team to quickly and efficiently convert hotels to join our system. Conversion highlights an exciting new growth channel for Starwood in India. Many well-located, but under-branded hotels represent enormous untapped repositioning potential.

India is Starwood’s 4th largest market and will soon be the 3rd Our aim is to be able to drive an emotional connect with the Indian audience for our brands so that Indians see our brands as their “own brands” and not just as brands operated by another Global hospitality chain. We wish to evolve and move beyond “owning brands” to “owning our guests”. On a more immediate basis, we would also ensure that the large number of hotels we are opening this year are able to hit the ground running and ramp up as quickly as possible. We know where in India we want hotels and we know which brands will work for us in which markets. Now to navigate through India, we need the right local partners and that is critical to our success. At Starwood, it is very important for us to assess the market, the competitive environment, the growth opportunities before we decide on which brand will be suited to a particular location. Our development mantra is “right brand, right partner, right location.” India today is still an ‘under-hoteled’ market, and the demand for high-caliber lodging is expected to far exceed current supply for at least the next three to four years. Today India is Starwood’s fourth largest market and will soon be the third. We have a strong and fast growing footprint and a robust pipeline. Starwood’s legacy in the region dates back to 1973, and today we operate 41 hotels in India(38) Maldives(2) and Bangladesh(1) and have 42 hotels in the pipeline (35 in India). We aim to have 100 hotels under operation, development and management contracts signed by the end of 2015 with eight out of nine Starwood brands flying their flag in India. We are well on track to achieve this target. Starwood continues to grow Westin in gateway cities and key markets like Noida. It is now looking at strengthening its resort portfolio with Westin in Khandala and in Bekal. Starwood is also focused on seeing an energized portfolio of Le Meridien with renovated Hotels and new resort Hotels under development – The spectacular Le Meridien Mahabaleshwar will open in 2014. Le Meridien Jaipur, Kochi and Bangalore are at various stages of renovation. We also have Le Meridien Hotels under development in Noida and in Ahmedabad. We are growing Sheraton further into NCR and gateway markets with Sheraton hotels under development in Chandigarh, Greater Noida and Whitefield Bangalore. Sheraton is also looking at growing its resort portfolio with the signing of the Sheraton Jalandhar Resort & Spa. We have five Aloft Hotels currently operating in India and have three more under development – Aloft Bangalore Cessna Business Park, Aloft New Delhi Aerocity and Aloft Calangute Goa. We also have six Four Points by Sheraton properties across India in Pune, Navi Mumbai, Vishakhapatnam, Jaipur, Ahmedabad and New Delhi Airport Highway. We are seeing the Four Points by Sheraton brand emerge as a developer’s darling with hotels under development in Whitefield, Faridabad, Gurgaon, Mumbai International Airport, Dehradun, Agra, Vadodara, Tirupati, Dahej, and Bangalore airport. Four points by Sheraton enjoys the halo effect of the Sheraton brand. We have 10 Luxury Collection hotels in India under an exclusive franchise arrangement with ITC hotels. Starwood

Challenges and opportunities

DILIP PURI

MD, India and Regional VP, South Asia, Starwood Asia Pacific Hotels & Resorts High cost of land, high interest rates and high levels of inflation are strong barriers to entry. Coupled with the myriad number of licenses, permits and approvals required to develop and operate hotels, it is certainly not a business for the faint hearted. is all geared up to bring its world renowned luxury brands St Regis and W Hotels to India with one St Regis and four W Hotels currently under development. With this, Starwood will soon have eight of its nine brands fly their flag in India.

Franchise vs management strategy While our preferred mode of operation is management, we are open to franchising our Upscale brands like Aloft and Four Points, should a portfolio deal opportunity come up. The focus for our brands in the Upper Upscale and Luxury segment will be the managed route. While selecting a franchise partner we go through the process of pre-qualification to gauge the ability of our partners to meet our standards. Experience in managing international hotel chains is an advantage. We work closely with our franchise partners to support them to ensure consistency of standards and brand experience.

Conversion Strategy Conversion of existing hotels we believe is an opportunity with untapped potential. To keep up with the growing global demand, Aloft is embracing existing hotel conversions and adaptive reuse projects as a strong part of its global growth. Existing office buildings with high ceilings provide an opportunity to do this. Conversions will help Starwood meet demand from partners and developers to bring more properties online. Adaptive reuse projects aren’t just an expedient way to bring more properties online quickly; they’re also a way to expand sustainably, and merge Aloft’s urban aesthetic with historic structures in a way that appeals to guests, partners, and developers. One of the biggest challenges we face in India is the slow pace of development due to regulatory procedures and infrastructure. We also believe that there exists a large number of smaller Hotel chains and standalone Hotels that offer quality lodging and that could easily fit into one of our upscale brands. Asset ownership is challenging in today’s competitive environment and Starwood’s distribution

One of the key challenges in India remains the slow pace of development of hotels and the even slower pace of infrastructure development. It takes more than twice as long to build a hotel in India than in China. High cost of land, high interest rates and high levels of inflation are strong barriers to entry. Coupled with the myriad number of licenses, permits and approvals required to develop and operate hotels, it is certainly not a business for the faint hearted. We would like to be the developers’ choice and with our bouquet of distinct unique compelling brands which are differentiated from a lifestyle perspective and not from a price point perspective, we believe we have a competitive edge by offering a choice of type and style tour developers. However Hospitality development is not for the faint hearted. Infrastructure, licensing, regulatory clearances, land acquisition continue to be a bottleneck for Hotel development and growth in a relatively under hoteled market. Access and connectivity, are another challenge that we face. You can build great hotels but if accessibility to these hotels are not easy, how then do you justify the investment. India makes a very compelling story with its massive domestic market. Our success in China did not happen overnight. We opened our first hotel, The Great Wall Sheraton in Beijing in 1985. But the real acceleration in growth began only in the middle of the last decade. Today, we are over a 100 operating hotels and another 100 under development. We will reach this point of inflection in India too. The success of the new Westins of India, the introduction of our upscale brands, Four Points by Sheraton and Aloft, the opening of the first new build company managed Sheraton in Bangalore, the opening of the 100th Le Meridien worldwide and the first one in India in over ten years in Coimbatore are all examples of the success Starwood in India. With our distinct lifestyle brands, long experience and robust management infrastructure, we believe that we are the preferred operator for the Indian hotel development community. Another big part of expanding in India is the huge potential of the India outbound market which is growing exponentially. As Indian travellers become familiar with Starwood’s brands in India, we believe that they will look for our brands when they travel abroad. With a projected size of 50 million Indian travellers abroad by 2020, this market presents a fantastic opportunity for our hotels globally.

INVESTMENTS Our corporate strategy is to own brands and manage hotels either through a Franchise or a Management model and not be real estate investors. So the investments we are making are not in real estate but in building our brands and loyalty, in people and training, in technology, in resources and in infrastructure that supports our growth, our business model and our distribution. In a place like India, having an established team that’s been there a long time, understands the market and knows how to get things done is an asset that isn’t on our balance sheet, but is invaluable. ■


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Rajeev Menon oversees dynamic Marriott development across all brand verticals

The Marriott Group has been steadily growing its different brands. Each of them is making its presence felt. Rajeev Menon, in an interview with Hotelscapes, outlines the chain’s priorities.

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o, how is the Marriott story developing in India? Am I right in concluding that you are only managing hotels and not franchising them? Long back we took the decision not to franchise but to manage ourselves. In 1999, when we came to India for the first time, we took upon ourselves to manage our brands ourselves and to build them. I don’t think I am going to say never but not for the time being, as our focus remains to focus on quality that we can manage. We need to create a reputation for ourselves. And what has been the success so far, and how would you judge your performance? I would think we have done well over this period. For all

the three segments that we cater to – the owners, the customers and our associates ( the team that works for us). We need the loyalty of all the three. I must say I think we have performed reasonably well, even if I am saying so myself. How has the story been for your owners, possibly the one segment that actually gives a kick start to your operations? As for our customers, we carry a 19 per cent premium in RevPar over our rates – our customer satisfaction is the highest among our competitors. This premium results in profits ensures them. This results in happy owners, and makes them believe in us when they continue to grow with the brand. You see the Rahejas – all eight of them, the Chordias in Pune –

RAJEEV MENON

Area Vice President, South Asia, Marriott Hotels As for our customers, we carry a 19% premium in RevPar over our rates – our customer satisfaction is the highest among our competitors. This premium results in profits, ensures them. This results in happy owners, and makes them believe in us when they continue to grow with the brand.

10 Years of Authentic Hospitality! David Mansfield

Area Director / GM, Grand Hyatt Mumbai “Since its inception in 2004, Grand Hyatt Mumbai has been committed to providing its guests with authentic hospitality and an experience that is truly unparalleled in India! 2014 is an exciting time for us and for the Hotel Investment Conference – South Asia (HICSA), as we celebrate our 10th Anniversaries! It feels great to be sharing this common bond with HICSA – a prestigious event attended by Hotel Inventors, Financiers and Operators. HICSA has grown over the years to earn the reputation of being the best hospitality conference in the region and is known for its excellent networking opportunities with influential decision-makers and delegates. It gives us much pleasure in hosting HICSA for the 7th consecutive year in 2014. As we (both Grand Hyatt Mumbai and HICSA) share these moments of celebration with our friends and well-wishers, we truly value and cherish this relationship which has become stronger over the years.”

they remain happy to grow with us. We continue also to get new partners. As we open the JW at Sahar in the 4th quarter, we will then have 2000 rooms in North Mumbai alone. What do you feel makes the owners happy? Any special pull of being a apart of the Marriott family? Sure, you may ask what makes these owners so confident about us? Our brands get big traction across segments across the country. So much so, that we now have 24 operating hotels, 47 are under construction and we are looking forward to our hundred mark! Each of our brands is getting noticed and is proving a big draw. At this moment, there are 10 Courtyards under construction across India. I also feel there is a sense of pride in owning a Marriott hotel! What is your take on conversions? That may propel bigger numbers to your growth story? Conversions are also happening but we remain selective and cautious. I cannot so more at this stage. We are talking at some centres and we can also make some announcements soon, but nothing for the moment. It is important for the hotel to have the right profile for us to move in. Coming back to owners, what makes them confident about working with Marriott? What makes them confident? If you compare performance across brands, against our competitors, you will have the answer. In our stable portfolio during 2013, we delivered double digit growth in profits. And what about owning hotels? We are a pure management company and do not own hotels. Across the globe, you can possibly count the number of hotels we own on your two hands. That out of a portfolio of over 4,000 hotels! There have been a few notable exceptions. We created the Edition brand out of three strategic heritage buildings in New York, London and Miami. We converted these into hotels and sold them a few months later, keeping the management with us. This was a pure business strategy, to develop and sell. What is the situation about your associates, going back to your three defined segments? Then we need to study our associates. Marriott has among (Contd. on page 9)


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Destination Bekal picks up momentum DINESH KHANNA Executive Director, Vivanta by Taj Bekal

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rom beaches to hill stations, Ayurvedic rejuvenation options to serene backwaters, Kerala offers a myriad of experiences to every tourist. The upcoming trends that are observed in the hospitality industry are as follows: Unconventional holidays: Over the past few years, we have observed that tourists no longer plan a usual holiday. There is an increase in the number of travellers on the lookout for unconventional holidays. At Vivanta by Taj, we offer our guests with interesting motifs that they can avail of during their stay with us. For instance, at our Bekal property in Kerala, guests can take a trip to the Bekal fort or sign up for a romantic dinner by the river or visit a plantation. Spa & Wellness: Another trend that we observe is the increase in the number of spa and wellness holidays. We also have a lot of amenities designed for our guests to ensure that they have a relaxed stay. One of the biggest offering that we have at Vivanta by Taj – Bekal is the Jiva Grande. International guests: We are witnessing a lot of guests from different countries and have begun customising our packages and services as per their expectations. Our international guests focus on revisiting history and exploring the local culture. Renewal of Vows: Another trend is the increase in the number of married couples travelling to renew their wedding vows. For them we have introduced a wonderful package that allows couple participate in the Dampatya Homam (Fire ceremony) or opt for a scenic setting at the Big Gazebo by the riverside for the ceremony. The biggest challenge that we face is to keep the culture of Kerala alive and to continue offering our guests best experience every time they visit us. ■

Rajeev Menon…

(Contd. from page 8) the strongest work cultures in the country, not just in hospitality. Typically, too, we emerge in the world as the only hospitality company in corporate rankings. Our internal understanding of staff or associate satisfaction is in the high 90s. Presently, we employ some 7000 staff across the country. Our cardinal philosophy is that if we take care of our associates, they will take care of our customers. (Implied here is that if the customers are happy and keep coming back, that will take care of our owners, because they want profits and want to run successful hotels). So much for the Marriott story, what about trends in general? Where is the industry going? Hotel building has slowed down. People today are lot more strategic in what they are building. Some six to seven years ago we witnessed a mad rush to build whatever came one’s way. Today, a lot more cautious owners want to stay and are weighing opportunities. They are now involved in a lot more strategic planning of their resources. The result is that the market is now maturing, as there are many learning lessons for all of us. Any other trend that you see, that you wish to share? Like hotels selling and are there buyers? Some degree of consolidation is happening. Some of the smaller players are merging with the bigger ones. See the merging of ISTA with Hyatt – new partnerships are emerging. When the seven to eight per cent growth returns to the Indian economy, a mature market would have emerged to take advantage of newer opportunities. But the craziness that you witnessed in the recent years has perhaps become history. In more recent times, while Business Travel remains a cornerstone, MICE has played an important role, and will continue to do so. Short breaks will become more popular, both to smaller towns and also to metro cities. The leisure market, in our opinion, will start to grow. Leisure packages are becoming a part of the business. Food and Beverage is becoming huge and Indian cuisine is becoming a big focus area for us. We believe we create such typical outlets that their duplication in every sense of the word is not possible. It is not just the food but also the ambience and the mood, that is often not possible to be recreated in another circumstance or surroundings. Weddings are becoming a big revenue stream for the industry and we are no exception. ■

KESHAV SURI

Executive Director, The Lalit Suri Hospitality Group

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omestic and international travellers, nowadays, are exploring offbeat locations in India for holiday. Of late, the trend is to experience wellness with serenity to destress. One such destination that has become very popular today is Bekal in Kerala, which provides wellness in the arms of a tranquil environment. Legend has it that Parshuram, the sixth avatar of Vishnu is the nurturer of ‘Gods own land’ - Kerala. It was Parshuram who initiated Kalaripayiattu, a martial art form which is a discipline for body and mind. He also promoted Ayurveda, the oldest medical living system in the world. The Lalit Resort & Spa Bekal is a dedication to this legendary sage and offers not only ayurvedic healing and curative therapies but also exciting and adventurous activities for guests. One of the unique features of the resort is the herbal garden laid out in the shape of a human body, with herbs planted according to its usage on specific parts of the body. Connectivity within the region through air remains a challenge. For guest’s convenience, The Lalit Resort & Spa Bekal has its own helipad and aviation service. Also the tourism department is planning to beef up the connectivity in the region by building an airstrip at Periyar near Bekal and sprucing up the Kottikulam railway station. We hope this will benefit the tourists planning to visit Bekal.” ■


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FHRAI president Shervani on the Five challenges facing the Indian hotel industry

Saeed Shervani is an outspoken industry figure who has been guiding FHRAI, the premier hotel industry body, in the last year as its president. Shervani, here, lists some of the industry challenges.

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ultiple Taxation

The hospitality industry is currently subject to a labyrinth of central and state levies such as Service Tax, VAT, Excise Duty and Luxury Tax amidst other. These have an adverse cascading effect on India’s price competitiveness as an international tourist destination and also discourage discretionary spending by domestic tourists. Hotel Accommodation and Restaurants must be included in the negative list of Service Tax since the same base of F&B and room revenue is already subject to VAT and Luxury Tax by the State Governments. There should be a uniform and moderate rate of Luxury Tax across the country, which is applicable only on actual and not published tariff. The composite tax rate for the tourism sector under the proposed GST regime must not exceed 8 per cent.

Lower cost finance The hotel industry is inherently highly capital intensive with a long gestation and payback period. We require an additional capital invest-

ment of Rs. 1,25,000 crore over the next five years, to augment our existing inventory by 1,80,000 classified hotel rooms in order to bridge the projected demand-supply gap. However, the prevailing lending norms and debtfunding structures for hotels are not suitable for the cyclical nature of the hospitality industry. In most countries, the term period of the loans to hotel projects ranges from 20-25 years, with average interest rates of 6-8 per cent, whereas in India the industry is forced to borrow at high rates of 12-16 per cent and for relatively shorter tenures of 8-10 years. In our country, hotels typically have a construction period of 3-3.5 years and, with such short loan tenures, the project only has 5-6 years to pay for the debt service, which is unrealistic. We have proposed that all hotels, irrespective of star category and geographical location, with a minimum project cost of rupees 50 crore should be included in RBI’s Infrastructure Lending List.

One-window clearance In some states, hotels can

delays and result in an investment friendly environment.

‘Industry’ status to tourism

SAEED SHERVANI

President FHRAI and Managing Director, Shervani Hotels We require an additional capital investment of Rupees 1,25,000 crore over the next five years, to augment our existing inventory by 1,80,000 classified hotel rooms in order to bridge the projected demand-supply gap. require as many as 100 approvals, licenses and permits to set up and commence operations. The presence of multiple agencies, archaic laws and rigid guidelines invariably lead to significant time and cost overruns for projects, causing additional financial burden and great anxiety for

entrepreneurs. The Central and State Governments must move towards the introduction of a uniform approval and licensing system across the country, with minimal local/regional permissions and sanctions required for hotel development, which can bring about homogeneity, reduce

The Seventh Five Year Plan (1985-89), had proposed that tourism should be accorded an ‘industry’ status. The implementation of this decision, was however, left to the discretion of individual State Governments. It is indeed disappointing that even more than two decades later, many states are yet to adopt this progressive policy measure. We believe that all states should recognise tourism as an “industry” and ensure that hospitality establishments are entitled to avail tangible benefits such as lower rates for property tax, industrial tariff on inputs like electricity and water instead of paying high commercial charges, avail interest subvention schemes and exemptions/ moratorium on payment of certain local and state levies amidst others. This will lower the operating cost structure and enhance the overall competitiveness of the tourism industry.

Availability of land One of the main factors which

is impeding the industry’s growth is the scarcity and exhorbitant price of land, especially in metro cities. In India, land alone can often account for as much as 40-60 per cent of the total development cost of a hotel, as opposed to 15-20 per cent which is the norm internationally. In FHRAI’s view, Urban Local Bodies and other land-owning agencies of the Government in States and Union Territories, should earmark hospitality development sites which are provided at concessional rates with incentives such as higher FSI/ FAR to make hotel projects financially viable in the longrun. Instead of paying a heavy amount upfront, allottees should have the flexibility to make staggered annual payments as lease charges to keep the overall project costs down. We have also suggested that surplus land which is available with various Government departments and PSU’s can be deployed for construction of budget and mid-market hotels under the Public-Private Partnership model, particularly in areas which are being developed as integrated tourist circuits/ clusters. ■

East Delhi develops as niche market

Kempinski Ambience opened in East Delhi and has quickly captured a niche for itself as a MICE and weddings venue. We bring you an interview with its GM.

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ow is East Delhi as a market? What has been your experience so far? East Delhi is an emerging market. What was once a simple traders’ settlement is bustling as a new destination. With Noida and Gurgaon plateauing, East Delhi will soon emerge as the newest commercial and residential destination. Kempinski Ambience Delhi is the first luxury hotel in this region. At that time, no one realized the potential. But we never felt out of place since the time we opened our doors. In a way, the brand helped in the positioning of the destination. Following our footsteps, more and more projects are seeing the light of day. No longer has the discerning population of East Delhi to go all the way to Delhi for specialty dining.   What are the special niche areas that you are working on? In our first year of operations, our emphasis was on MICE. Since we were entering a new destination, it was important for us to position ourselves distinctly – therefore, luxury MICE was the area we focused on. Every hotel today has MICE facilities – but we wanted to stretch that by providing a luxury MICE experience. We have one of the finest, the largest and the most flexible MICE products in the luxury segment in the country and I am proud to admit that we have been able to back it up with service standards that equally match the luxury feel. Our second impetus has been in the area of food and

beverage. Luxury was an unknown segment in East Delhi till about a year back or till the Kempinski Ambience Hotel came into existence. Luxury and specialty dining although not unknown in the market, was not synonymous with the destination. So we had our task cut out to change the mindset of our consumer. Our aim was to provide breathtaking food in a visually stunning environment. Here again, all our restaurants have received rave reviews and awards.           How have you fared, in comparison to other business districts of the city/NCR in terms of occupancy and ARRs? It is important for every company to keep a track of its competition and learn from it. East Delhi is a new destination and we, as pioneers, have adapted to the tastes and preferences of our customers. Our Sales team works diligently to get the maximum business to keep the action going. What are Kempinski’s plans for India? Globally, some of the most historic meetings between world leaders have taken place at Kempinski. We’ve witnessed celebrities taking sanctuary in the world of calm we create for them through a combination of world-class facilities and prompt guest service, and have created incredible memories for guests on a ‘once-in-a-lifetime’ journey. I broadly envision replicating our global success in India as well. We are in no hurry to open up properties or grabbing the most market share – we are here to win hearts of our

VELLA RAMASAWMY

GM, Kempinski Ambience Hotel Delhi Despite the burgeoning rate at which India is developing and becoming a global power, there is still a huge unfulfilled demand for the luxury segment in hospitality that continues to grow increasingly. We are currently looking at launching 3-4 Kempinski hotels in the top luxury segment in India by 2016. Indian guests and to live up to our global brand promise for our in-bound guests. ■


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Unravel a Fortune wherever you go… Fortune Hotels now have 70 signed properties

Suresh Kumar, CEO, Fortune Hotels, a division of ITC Hotels, has been steering the good fortunes of this dynamic brand, conquering the mid-market space in the industry. Here is a update on the chain’s achievements.

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ne of the fastest growing hotel chains in the country, Fortune Hotels with 70 signed alliances, more than 5500 rooms spread across 55 cities in India, is operating 41 hotels at present. While providing business and leisure travellers a comfortable sojourn, it has been winning accolades for being the best ‘first class full service business hotel’ chain. The chain’s tag line says it all - ‘Let Fortune Take You Places’. The chain that was created to cater to the midmarket to upscale hotel segment has made its presence felt across the length and breadth of the country. ‘Fortune Hotels’ is not only taking its customers ‘places’ but also offering them excellent value for money in each location. Whether the hotel is located in a metro, mini-metro, a business location or a resort cum leisure destination, the brand is now widely recognised for the quality of its service. There is no validation needed for the fact that chain hotels by virtue of the immense synergy they generate, their distribution network, central reservation systems, pan-India sales, marketing infrastructure and support have a tremendous edge over standalone hotels. This is what Fortune Hotels provides, besides the pride of being part of India’s premier hospitality chain. Fortune, a member of ITC’s hotel group, has clearly defined sub-brands bringing instant recall. Therefore, the guests can easily match their requirements with the chain’s offers. The sub-brands now include the recently launched ‘My Fortune’ brand that represents best in class full service stylish hotels with young, vibrant and tech-enabled features. It offers the guests a place where they can have their own space. A place where the cool and breezy ambience is blended seamlessly with the warm, efficient and branded services. The first hotel under the new brand was flagged off in Chennai in 2011 and the second hotel is just on the anvil scheduled to be launched in April’14 in the garden city of Bengaluru. Other than ‘My Fortune’, the hotels that are due for opening in the FY 2014-15 also include Fortune Inn in Jalandhar and Fortune Park in Rajkot.

SURESH KUMAR

CEO, Fortune Park Hotels Ltd “We have always emphasised the virtue of leveraging our proud lineage of ITC Hotels, and the power of a “spread” as “the length of the chain is the strength of the chain”. However, there are various projects under different stages of construction and refurbishment that include Ajmer, Bhatinda, Bhimtal, Dahej, Dehradun, Haridwar, Imphal, Jodhpur, Meerut, Pahalgam, Shirdi, (Mashobra) Shimla, Srinagar and Vadodra. The Fortune Hotels brand draws its strength from the proud lineage-ITC Hotels, which is a pioneer in the hospitality industry in India. As it continues its sweeping growth through its well defined sub-brands, the focus of

Fortune Hotels is holistic in its development. The properties are being set up in major metros, mini metros, state capitals and business towns. Each hotel is created to suit the business needs of a particular environment leading to a perfect economic fit, and with each property taking its roots in one location it further opens up the possibilities at another level in a “neighboring hub of development”. Fortune Hotels has undoubtedly established itself as a leading ‘first class, full service business hotel chain’ and it plans to maintain this position by following a balanced approach towards growth, expansion, brand extensions and providing the same assured quality of product and service across the country. According to Mr Suresh Kumar, Chief Executive Officer, Fortune Hotels, “We have always emphasised the virtue of leveraging our proud lineage of ITC Hotels, and the power of a “spread” as “the length of the chain is the strength of the chain”. We plan to work towards taking further our vision of unfurling a Fortune at every 180 km by concentrating on Metro, Mini-Metro, Tier I & Tier II cities across India. The chain has extensive expansion plans and we are looking at being a 90 hotels strong chain by the year 2016-17.” In the process of creating quality hotel accommodation in a wide choice of destinations, the Fortune Hotels chain has emerged as a brand with a reputation of contemporary modern hotels offering quality products and ‘value led’ services. It’s branded restaurants, modern décor, convenient service designs and sub-brands that cater to different categories of guests, sets it apart from all other chains. The chain has been the winner of numerous awards PATWA International Award for the “Best First Class Full Service Business Hotel Chain in India 2013”, Today’s Traveller Award and Safari India Award for the ‘Best First Class Business Hotel Chain 2012’, SATTE Award for ‘Leading Mid-Market Chain 2012’, Safari India Award for the ‘Best First Class Hotel Chain’ in 2010, the Abacus TAFI Award for the ‘Best Value Hotel Chain in India 2009’ and Hospitality India Award for the ‘Best First Class Hotel Chain 2008-2013’. ■

Westin Hotels launches multi-million $ campaign to help guests focus on wellbeing

Westin Hotels & Resorts has announced the global launch of the Westin Well-being Movement, an ambitious $15 million brand-wide campaign designed to enhance the well-being of guests and associates around the world.

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enowned as an industry innovator with a history of firsts in the wellness space, Westin Hotels & Resorts has announced the global launch of the Westin Well-being Movement, an ambitious $15 million brand-wide campaign designed to enhance the well-being of guests and associates around the world. The year-long initiative will introduce a string of innovative partnerships and programs across Westin’s six brand pillars: Feel Well, Work Well, Move Well, Eat Well, Sleep Well and Play Well. To celebrate, Westin hotels around the world will open their doors for a well-being open house, where guests, associates and consumers can experience the brand’s signature programs. For the next week nearly 200 hotels and resorts will hold wellness events and programs open to the public including a week long Wellbeing run with eminent personalities across Chennai to clock over 2000 kms organised by the Westin Chennai Velachery, launch of a detox program at Westin Hyderabad Mindspace along with a SuperfoodsRx breakfast and group yoga and meditation sessions and special itineraries for guests to experience Wellbeing at The Westin Mumbai Garden City and Westin Pune Koregaon Park. For more information on open house activity please visit Westin.com. The Westin Well-being Movement will launch globally

with Headspace, a leading force in the field of health and wellbeing. This first new partnership of 2014 is aimed at helping guests “feel well.” The Westin Well-being Movement is a natural extension of the brand’s historic commitment to health and wellness. The inspiration for the brand’s wellness strategy, the iconic Heavenly® Bed (Sleep Well) is the beloved of guests and lauded as one of hospitality’s great innovations. Westin’s global partnership with SuperfoodsRx (Eat Well) offers guests food that fuels the body with rich antioxidants and tastes great. WestinWORKOUT, RunWESTIN and Westin Gear Lending with New Balance (Move Well) together pack a formidable punch and offer guests a holistic fitness solution. The brand’s nature-inspired design, signature sensory welcome and Heavenly Bath and Heavenly Spa (Feel Well) offer a relaxing respite from the rigors of travel. Tangent (Work Well), the innovative workspace concept modeled to support today’s mobile traveler, is receiving rave reviews and high usage from guests. Westin Weekend (Play Well) signature experiences are designed to let guests escape, discover and relax without all the hassles and restrictions other brands impose. The brand’s new digital destination guide, Westin Finds from Afar, provides guests with uniquely curated travel experience. ■


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‘Hotels of the Decade’ Awards

On the occasion of HICSA’s 10th anniversary, HVS announces finalists for its first ‘Hotels of the Decade Awards’

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wards to be conferred upon the most iconic hotels built in the decade, the winners of which are to be announced at HICSA 2014. HVS, the world’s leading hospitality consulting firm celebrates the 10th Anniversary of its annual Hotel Investment Conference − South Asia (HICSA) this April. A two-day conference

dedicated to the hospitality sector, HICSA is globally recognised as the most impressive and unique platform to explore growth and investment opportunities both within and outside India. Marking its 10th Anniversary, HICSA is proud to present the ‘Hotels of the Decade Awards’ rewarding outstanding accomplishment and celebrates excellence by recognising the very best and

the most iconic hotels built in the last decade. The winners will be announced at HICSA to be held on 2-3 April 2014 at Grand Hyatt Mumbai. Nominations were solicited from hotels which have been operational in the last decade - between January 2002 to December 2011, across two categories: Luxury/Upper Upscale/Upscale Segment and Mid Market/Budget/ Economy Segment. 38 nomi-

nations were received and HVS is pleased to share the names of the Top 10 finalists in each of the two categories mentioned above. This list of finalists was derived through a meticulous analysis of performance across key parameters, both quantitative - such as Inflated Development Cost, RevPAR, Food & Beverage Revenue, Gross Operating Profit, as well as critical qualitative aspects.

Referring to the Hotels of the Decade Awards, Manav Thadani, Chairman – HVS Asia Pacific and founder of HICSA said, “The last decade has witnessed the debut of some of the finest hotels in India and South Asia. As HICSA completes a momentous journey through a decade, we feel honoured to announce this special accolade which will reward and recognise the most remark-

able hotel developments in the South Asian region, on this special occasion of our 10th anniversary. The judging criteria for these awards has been carefully designed to hand-pick the hotels that are truly exceptional, in our quest to identify the real ‘game-changers’ that have redefined the paradigm of excellence amongst hotels in the entire South Asian region.”

The 10 finalists (arranged alphabetically) in the two categories for HICSA ‘Hotels of the Decade Awards’ are: FINALISTS IN LUXURY/UPPER UPSCALE/ UPSCALE SEGMENT Grand Hyatt Mumbai

  JW Marriott Mumbaia

ITC Gardenia, Bengaluru JW Marriott Hotel Mumbai Park Hyatt Goa Resort and Spa Sheraton Bangalore Hotel at Brigade Gateway The Leela Palace New Delhi

  Park Hyatt Goa Resort & Spaa

The Oberoi Udaivilas, Udaipur The Oberoi, Gurgaon Trident, Gurgaon Vivanta by Taj - Dal View, Srinagar FINALISTS IN MID MARKET/BUDGET/ ECONOMY SEGMENT Country Inn & Suites by Carlson, Jaipur

  Ibis Mumbaia

Courtyard by Marriott Pune Hinjewadi Ginger Whitefield, Bangalore Holiday Inn Mumbai International Airport Ibis Gurgaon Ibis Mumbai Airport IRCTC - Ginger Rail Yatri Niwas Lemon Tree Amarante Beach Resort, Goa Novotel Hyderabad Convention Centre Ramada Jaipur Hereafter, the 10 shortlisted hotels in each category will be subject to peer voting, wherein a representative from each shortlisted hotel will vote for their three favourite hotels in the respective category, excluding their own. Additionally, an expert

panel comprising distinguished industry specialists, leaders and stalwarts will help select the very best in class. The names of the winning hotels shall be announced on DAY 1 of the HICSA conference as part of the scheduled program. ■

  Novotel Hyderabada


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HVS India Alumni Interview Excerpts

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VS India’s 17 years of existence has seen talent being inducted, developed and made ready for bigger roles within the industry. Even as the organisation has seen several turnovers since 1997, what is heartening to note is that the HVS India Alumni community continues to be connected and remain an integral part of the hospitality industry in the region. Manav Thadani, Chairman, HVS Asia Pacific, and the first employee of the consulting giant’s India office, says, “We started with a handful of associates nearly two decades ago, and today we have a team strength of 45 plus very capable individuals. Naturally, over time a lot of associates joined and several left, but I don’t see that as a negative trend. Instead, I believe it is natural and healthy to have periodic churns in the organisation allowing for fresh talent to be inducted and creating growth opportunities for the others.” Crediting it to the open-door policy and great team camaraderie, Manav adds, “Most of our alumni have consulted and discussed their future career prospects outside of HVS with me or their supervisors prior to leaving, which is indicative of the mutual trust existing within the team. In fact, a majority of them either are our clients today or refer sizeable amount of business opportunities to us every year.” Given below are excerpts of interviews with some HVS India Alumni, who are amongst the most recognisable faces in hotel development in the country today:

Navjit Ahluwalia

Senior Vice President Hotel Development – India and Indian Subcontinent, Marriott International What is your current role in the organisation you work with? I am responsible for the growth and development of all our brands in South Asia. What is the most rewarding aspect of your job? Being there at the “start of things” and the fact that I am able to contribute in my small way to the Marriott story in the region. Also, participating in planning and executing a strategy that defines our company’s success is a very humbling experience. What made you join HVS earlier in your career? I had worked in operations for over 10 years, prior to joining HVS, and understood what it took to run a hotel. I, now, wanted to understand the business side of things – What kind of hotel to build? Is the investment going to give me a return? What is the value of my hotel? ...etcetera. How did your HVS experience prepare you for your career ahead? My experience in HVS was fundamental to what I have done for Marriott in the last 10 years. It gave me the best foundation anyone in our business could ask for. I learnt an awful lot in my years at HVS. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? I think there were a lot of moments. If I highlight a few: -  Time at Mineola Hilton -  The ITDC transactions of Qutab Hotel and Lodhi Hotel -  The time we sat in the offices of a top consulting firm and showed them how we did a simultaneous discounted cash flow analysis for a hotel valuation -  Going for an office lunch when the HVS team in India was just 3 people -  And last but not the least the many times Deepika, Manav’s wife, sent us all lunch at the office, which included the awesome Sindhi Kadhi

Kiran Andicot

Vice President Hotel Development – India and Subcontinent, Marriott International What is your current role in the organisation you work with? I am part of Marriott’s development team in South Asia. What is the most rewarding aspect of your job? Interacting with owners and being able to contribute to Marriott’s growth in the region.

What made you join HVS earlier in your career? The opportunity of joining a hospitality consulting team and learning on-the-job. How did your HVS experience prepare you for your career ahead? My stint with HVS helped me gain a macro perspective on the hotel business and prepared me for a role in hotel development. What were some of the most defining events/fun moments/opportunities/aspects of your time at HVS India? Well, of the several exciting projects that I got the opportunity to work on, my favourites were: -  Feasibility Study - Hotel & Convention Centre (HICC) in Hyderabad -  An eight-city Market Scan and Strategy Recommendations for the Taj Group in India.

Lokesh Sabharwal

Vice President Development – India, Nepal, Bangladesh and Sri Lanka, Accor What is your current role in the organisation you work with? I am the Vice President Development for Accor Hotels, responsible for leading the company’s growth activities across India, Nepal, Bangladesh, Sri Lanka and Bhutan, besides being a key member of the regional strategy and operations team. What is the most rewarding aspect of your job? Watching a hotel come up and commence operations, at what was a piece of land, just a site, when you saw it first. Additionally, the satisfaction of building a long term relationship with owners, that extends beyond work partnerships in many cases, and being able to live up to the trust they have in both Accor and me is very satisfying. What made you join HVS earlier in your career? It all actually began with a friend of mine urging and pushing me to meet Manav and take the conversations forward. HVS offered an entirely new spectrum of opportunities to someone coming from hotel operations. On a lighter note, Manav’s ability to convince, in addition to the constant feelers from Natwar made it irresistible for me to join HVS. Also, a desire to run away from Kolkata definitely contributed to the decision. How did your HVS experience prepare you for your career ahead? Well, it literally opened my eyes – from the minutiae of day-to-day hotel operations, to a whole new world as it were. In a way it was like a post graduate programme and really laid the foundation for what I have done since then and do today, besides being the launching pad to some long standing relationships within and outside the industry, which would have been unlikely without the HVS background.

What were some of the most defining events / fun moments/ opportunities / aspects of your time at HVS India? Amongst the many projects I got to work on, I really enjoyed the following: -  The feasibility for the Himalayan Ski Village -  Update feasibility for the Ambience Hotel in Gurgaon (after Navjit and Kiran). Also, coming from hotel operations, flexi-hours were a definite “new” and very enjoyable.

Saurabh Gupta

Director Development – India, Nepal, Bangladesh and Sri Lanka, Accor

What is your current role in the organisation you work with? I am Director Development for Accor for in India, Nepal, Bangladesh and Sri Lanka. What is the most rewarding aspect of your job? It is to be able to conceptualise and implement hotel projects that would have far reaching impact on the prospects of a particular market, the ownership and Accor. What made you join HVS earlier in your career? It happened more by default than design. I was bored of not exercising the little cerebral matter I possess and thought of trying out something different. At heart, I am an avid risk taker and have never regretted that decision of mine. How did your HVS experience prepare you for your career ahead? HVS presented the entire horizon to me… it introduced me to the management of businesses over and beyond hotels. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? -  Opportunity: Creating the platform called HICSA was a game-changer for HVS India and I cherish every moment of doing that with Manav. -  Fun Moments: There’s never a dull moment in HVS. All projects are unique and that’s where the novelty and fun stems from…Once, while explaining to a client the reason behind some very low projections; we almost came close to dealing blows to each other. The client felt HVS was being too pessimistic and wanted to develop a luxury hotel, which would offer airport transfers in a helicopter. He anticipated an ADR of US$ 300 while I forecasted US$ 80. Seven years on, he hasn’t mustered the courage of developing even a motel there! -  I loved the entrepreneurial spirit and flexi-hour work style that HVS promoted and the off-sites too were awesome and great fun. -  Also, I am possibly the only HVSer ever to have moved from Consulting to Operations.

Sameer Tandon

Manager Development – India, Nepal, Bangladesh and Sri Lanka, Accor

What is your current role in the organisation you work with? My present role in Accor as the Development Manager requires me to identify new development opportunities for the company in the region. What is the most rewarding aspect of your job? Finding new business, picking the ones most suitable instead of everything and in the end striking the perfect balance of creating value addition for both the real estate owners and the company is a high point for me. What made you join HVS earlier in your career? One of the proudest entries that I have on my resume still continues to be my association with HVS. I joined HVS way back in 2006, when the firm was still operating from a very small office in New Delhi. I still remember the first time I went there for an interview. Looking at the set up left me wondering if this is “The HVS”.


02.04.2014 At that time, it was probably the biggest decision of my life having just completed six years in operations and on my way to reaching a mantle where my career would have grown more rapidly that it had previously. I had two options – either to take the job of a system specialist at Hyatt; which would have meant touring Hyatt properties around the world, or, join HVS India. The plunge, if I may call it in hind sight has probably been the best decision of my life till date. The learning was the steepest. Having worked on the shop floor had made me believe that I knew everything about the hotel business; it was quickly tossed out of the window in a few hours of joining HVS. How did your HVS experience prepare you for your career ahead? HVS taught me to think like an entrepreneur, understand the different dynamics at play, grooming me for my current development role with Accor. In current days of recessionary environment and high barriers to hotel development; opportunities don’t come simple and straight. The present conditions require a very strong foundation in understanding real estate, the market and hotel operations. Something I credit HVS for. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? Past memories are in bounty and difficult to pen down. Something I instantly recollect is the way Manav promoted me saying my clients are complaining because I am giving them the wrong business card. He promptly gave me the new card with the new designation. From those to facing a shareholder board and defending my valuation are some that I can fondly recall. Coming from operations into the world of feasibility was a sea change and often left me counting and recounting the number of zeros in a project’s development cost or in a valuation. The confidence of the organisation in picking up such novices and grooming them for larger roles is commendable. Hats off to the senior members in the HVS team for their patience in explaining this amazing business! My personal favourite still continues to be the SVF (simultaneous valuation formula), which took me ages to understand. I still laugh recollecting all the different misconceptions I had on how it worked. Learning that was probably a divine intervention for all the efforts put in. Even today, the association still runs deep and the company is always there to support. I still end up calling somebody at HVS at least once a week to ask for a favour. Something I am grateful for. Friends made at HVS and network developed from that time still comes handy in my current job. The best example of HVS churning out industry specialists can be given from the fact that I work along with two other colleagues and they both come from HVS as well.

Nikhil Manchharam

Vice President Acquisitions and Development, Starwood Hotels and Resorts (HVS Singapore Alumnus who worked closely with HVS India) What is your current role in the organisation you work with? Vice President Acquisitions and Development at Starwood Hotels. What is the most rewarding aspect of your job? Nikhil: The greatest goal is working with various teams like a team, as nothing else matters except the best outcome. What made you join HVS earlier in your career? It was and is a centre of learning where aspirations are met with empowerment. The extremely selective process of appointing someone to join the team makes it very coveted and develops the confidence of the individual once he/she is in. Additionally, the diverse set of colleagues and HVS offering a great stepping stone for a long term career in the industry made it very desirable for me to join the company. How did your HVS experience prepare you for your career ahead? HVS encourages and prepares one to develop on the key pillars of career progression and professional development comprising learning, leadership, problem solving (since one size does not fit all), team building and entrepreneurship.

HICSA SUPPLEMENT 2014 HOTELSCAPES

What were some of the most defining events/fun moments/opportunities/aspects of your time at HVS India? I will like to mention here that I got to know Manav while at HVS Singapore and not in HVS India through the valuation assignments we worked on in Maldives and Bali. Am sure he remembers these projects as they were perhaps significant for him as well, personally. It was defining in the way that Manav proved that working teams need not be based out of the same office and instead need to be aligned to the objectives of the organisation focussing on a unified point of view being ultimately presented to the client. These valuations eventually provided good guidance to the client on their decision making. A great learning from this, which continues to be shared with the teams that I manage is – always be open to situations, provide the right guidance with integrity and work as a team.

Bhaskar Baruah Director Acquisitions and Development – South Asia, Starwood Hotels and Resorts

What is your current role in the organisation you work with? I work with the Acquisitions and Development team of South Asia focussed on growing the presence of Starwood brand hotels in India, Maldives, Sri Lanka, Bangladesh, Bhutan and Nepal. What is the most rewarding aspect of your job? At this stage it is being able to live a near dream and be able to contribute to the growth of the organisation through the small in-roads we are able to make each day. Starwood is shaping up well and the next 5 years present many exciting opportunities for all our brands. What made you join HVS earlier in your career? At the time I joined HVS in 2007, it was not considered a structured plan in anyone’s professional career – consulting in the hospitality space was limited to a very small circle of investors and developers. However, looking back today I think it was a great decision. The five exciting years with HVS were a tremendous learning experience for me to look beyond day-to-day hotel operations (I was previously with ITC’s Hotel Division for seven years). How did your HVS experience prepare you for your career ahead? At an individual level, HVS delivers more than you can absorb. I had the choice of taking on as much work and responsibility as I enjoyed, and perform consulting assignments in as diverse a market as I wanted to. This continues to provide me a strong edge in my role with Starwood. Also, as a standard practice there was a great emphasis on building strong client relationships – many of these have been extended into my new role with Starwood. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? We always had a small yet content team at HVS and the work atmosphere strongly encouraged everyone to believe there were five Fridays in a week! To have contributed my part in trying to convert a naval aircraft carrier into a hotel + museum (INS Vikrant Project) was unique and will always be treasured as a showpiece assignment. Great colleagues was a given but to have seen a head strong leader in Manav was refreshing and encouraging. Above all, HVS gave me a well-balanced five years with equal measure of time between work and my family.

Kanishk Roy

Director Feasibility and Development Finance – South Asia, Hyatt Hotels Corporation What is your current role in the organisation you work with? Working as Director Feasibility and Development Finance

15

at Hyatt, I am responsible for underwriting all deals, which the company pursues in South Asia. What is the most rewarding aspect of your job? Getting to work on new, exciting projects which create long term value for the company. The feasibility process is taken very seriously and the function is critical to the responsible growth/expansion of the organisation. What made you join HVS earlier in your career? I had a keen interest in the feasibility/consulting side of the hotel industry. HVS was and continues to be the best in the business and I consider myself lucky to have got the opportunity to join the company when I did. How did your HVS experience prepare you for your career ahead? It helped lay a solid foundation for understanding the hotel business model and its varied intricacies. Also, it helped me gain the necessary fundamental knowledge and skillset required to be a successful feasibility resource in the hotel business. The HVS experience contributes to the confidence I now have when I evaluate, analyse and proffer my opinion on the viability of a hotel project. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? I was with HVS during the heady days of 2007-09 when hotel development in the country was on a high. The multiple assignments (including large multi-city projects), travels and learning opportunities I got then were terrific. Additionally: -  The quality of people on the consulting team was fantastic, as was the camaraderie that existed between us. -  HICSA (the event and the run-up to the event) was always exciting -  Working on the mega DIAL project was great -  The annual company off-sites and the Diwali parties were a lot of fun!

Tapan Srivastava Director Feasibility and Development Finance – South Asia, Hyatt Hotels Corporation

What is your current role in the organisation you work with? I am responsible for Feasibility and Development Finance for Hyatt in South Asia. What is the most rewarding aspect of your job? That I contribute to the growth of Hyatt in the region. What made you join HVS earlier in your career? To explore the development vertical of the hotel business. How did your HVS experience prepare you for your career ahead? It helped me gain perspective on the hotel development vertical. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? The camaraderie in the Gurgaon office just made coming to office so much more fun. Furthermore, the post-office drinks, annual office getaways and house parties are some really fond memories.

Sohaila Mallapur Associate Director Development – South Asia, Carlson Rezidor Hotel Group

What is your current role in the organisation you work with? My role at Carlson Rezidor Hotel Group is to source and close hotel management opportunities under our brands. Hotelscapes: What is the most rewarding aspect of your job? Well, the two most rewarding moments are when the deal is signed and of course when the hotel opens. The period before signing a deal or opening a hotel is a long process of hard work by the owners, their employees and us culmi-


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02.04.2014

HOTELSCAPES HICSA SUPPLEMENT 2014

Hotels Focusing on MICE Pavithran Nambiar

Satyajeet Krishnan

General Manager JW Marriott Mumbai

“The MICE business is definitely increasing in India. One cannot predict it being good or bad by just one phase of the year as it is divided over the year. Till now, we see the rooms being sold better in comparison to the last year. So, the projection of the MICE industry seems to be positive this year till now. It’s a very diverse segment with having different elements from corporate events to exhibitions, incentives and a lot more. The MICE industry overall has also grown substantially as I see the number of big players in last few years have multiplied. Also, with India becoming a preferred destination for foreigners for their incentive programmes, we are seeing a positive change and receiving a very broad clientele from India as well as abroad. We at JW Marriott receive around 25% of our business from this segment.”

General Manager, The Taj Mahal Hotel, New Delhi MICE tourism has given a new boost to the tourism industry of India. The prospects for the MICE industry are bright and encouraging. The technological revolution is indeed making its presence felt in the way in which events and meetings are being conducted. The Taj Mahal Hotel, New Delhi, is home to most of the key events and conferences that take place in the city. The State of the art amenities, standard facilities for conferences, unique incentive options, the stateliness, high security measures, most sought after banquet spaces and meeting rooms,  innovative culinary delights and with its unique blend of warmth and assiduous attention to service makes Taj Mahal New Delhi an ideal MICE destination both domestically & with the international market. ”

David Mansfield

Madhav Bellamkonda

Area Director / General Manager, Grand Hyatt Mumbai

COO Novotel Visakhapatnam Varun Beach

“The MICE segment at the current level is connected to the economic scenario as well; more opportunities come in when the economy is doing well. I believe the fourth quarter onwards of 2014, the MICE segment will start looking up and there is going to be more and more demand for the MICE business with regard to both inbound and outbound segments. The MICE segment is linked to the infrastructure and connectivity, so any destination that the government chooses as a MICE destination should also be developed in terms of connectivity, both air and railways. Secondly, the only way we can promote an industry is to promote through incentives on taxes. There has to be some sort of tax holiday for those who are establishing convention centres. Thirdly, the knowledge share among the people should be diverse, so that they try different destinations and help in increasing the incoming of guests.”

nating at a junction, which is the beginning of a beautiful partnership over the next 20 to 25 years. What made you join HVS earlier in your career? I was working with Horwath HTL in New Zealand and the work interested me. Each feasibility and operator search was different and I did not want to let go of the experience. Manav gave me the opportunity to pursue the path I set for myself by offering me a job at HVS in India. How did your HVS experience prepare you for your career ahead? As mentioned earlier, I started my career overseas and working at HVS gave me the exposure to a dynamic developing hospitality market. The trends, issues and nuances were completely different from what I had experienced in New Zealand, Australia and the Pacific markets. What were some of the most defining events/fun moments/opportunities/aspects of your time at HVS India? I guess the hands-on approach Manav used to encourage was most defining for me. He would sit down and review every analysis before it was submitted to a client.

“The productivity and yield that MICE presents to the hospitality industry has grown significantly over the past 5 years. Today, everyone expects something more than just a meeting space and catering while on the lookout for an ideal destination to host an event or meeting. Companies and event planners are constantly on the lookout for hospitality brands that can offer them state-of-the-art services and amenities that enhances the value of investments that are being allocated towards meetings and events. The top emerging trends with regard to MICE in the hospitality industry that one can witness in 2014 would include technologically upgraded banquet and meeting spaces. A gamut of international gourmet offerings with respect to the Food and Beverage services being provided, competitive pricing, destination specific incentive travel and more. The major clientele for the hotel comprises of companies from the Pharmacology and Pharmaceutical, Information technology, Lifestyle, Fashion and Automobile industries.”

Gunjan Bahl

Executive Director Global Real Assets – Real Estate India, JP Morgan Asset Management What is your current role in the organisation you work with? I work with JP Morgan Asset Management in the Global Real Assets - Real Estate India division, which manages Indian real estate-focussed Private Equity Funds. As Executive Director Acquisitions, I am responsible for identifying new JV opportunities and managing the asset/venture during the life of the investment to ensure a successful exit. What is the most rewarding aspect of your job? Investment in Real estate in India is a compelling opportunity for global investors and ensuring successful returns for the investors in our Funds is the most rewarding aspect

of my current job at JP Morgan. What made you join HVS earlier in your career? Given my hospitality background, post my MBA, HVS offered a unique opportunity to apply my past knowledge and to prepare me for the future. How did your HVS experience prepare you for your career ahead? HVS has extensive knowledge (operations and development) of the hotel industry; quality data that is best in class; practical and unbiased approach to consulting to ensure best interests of the client; and an impressive client list – all of which helped shape my career. What were some of the most defining events / fun moments / opportunities / aspects of your time at HVS India? In my short stint at HVS (2005 to 2006), I remember each day as being exciting, as HVS was always part of “that land auction”, “that new JV” in the hospitality sector; working with new and established clients; identifying new markets and analysing the numbers; and working with new brands/ operators to get them excited with the India story. ■


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02.04.2014

HOTELSCAPES HICSA SUPPLEMENT 2014

Are there any broken windows in your hotel? HVS India has prepared this exclusive article researched from across hotels how some inherent flaws creep into management.

“T

he half opened whiskey bottle caught my eye and I could visualise the broken windows at the property.” The observation was noted in the Executive Chef ’s office, as the bottle was kept with an intention to conceal, while interviewing him at a resort property. As soon as the interview was completed, the Beverage Store maintained by the F&B Department was inspected and broken windows detected. There was unaccounted beverage hidden in cupboards – an outright violation of the process of reporting all beverage leftover by guests to the Cost Controller. However, the reviewer did not stop there. He immediately rushed to the Main Store, revealed signs of some hasty activities. The expired items were being disposed off ! On further probing it was gathered that the executive team at the property never circulated the slow-moving report, highlighting yet another violation of a basic but a critical control measure while storing perishables. The reviewer’s timely intervention led to such lapses in processes and procedures

being brought to the notice of the Ownership and Management of the property. Another Property, Another Review and Another Case of Broken Windows “It will be our pleasure to review your property, however in case you do not engage us, please ensure that you get your property reviewed by someone having hotel experience, for we see many broken windows here” As per the brief provided to the reviewers, the subject property had a lot of open balances in the guest ledger (pertaining to guests checking out from the property without settling their bills). There were also many allowances being passed in the

  FACTOIDSS

India’s rank in the World Tourism Receipts during 2012 was 16th and rank in international tourist arrivals was 41. The rank of India was 7th among Asia and the Pacific Region in terms of tourism receipts during 2012. (Government of India)

The Travel & Tourism Competitiveness Report 2013 ranks India 65th out of 144 countries overall. The report ranks the price competitiveness of India’s tourism sector 20th out of 144 countries. It mentions that India has quite good air transport (ranked 39th), particularly given the country’s stage of development, and reasonable ground transport infrastructure (ranked 42nd)

Front Office system, for which the reason stated by default was ‘System Error’. While conducting the review it was observed that the Head of Front Office was not able to provide satisfactory answers to the Audit Team that comprised of two individuals – one having a background in Operations Audit/Finance and the other who had a prior experience of working at a managerial level in Hotel Front Office and Reservations. On the basis of the above observation, the previous employment record of the Head of Front Office was sought and a reference check conducted. As apprehended, the feedback was was rather dismal. Additionally, the employment file of the concerned individual maintained at the subject property was also checked and it became quite evident that the Head of Front Office’s employment letter was morphed, confirming the reviewer’s doubts on the individual’s integrity. The broken window in this case, was not following a simple but essential process of conducting a reference check.

The Broken Window Theory Though, the Broken Window Theory is a criminological theory, it befits well, with the complex, market-sensitive, personnel intensive operations characterising the hospitality industry. This theory was first introduced by Social Scientist James Q.Wilson and George L. Keiling, in an article titled “Broken Windows”, which appeared in the March 1982 edition of the “The Atlantic Monthly”. The title comes

from the following example: “Consider a building with broken windows. If the windows are not repaired, the tendence is for vandals to break a few more windows. Eventually, they may even break into the building, and if it’s unoccupied, perhaps become squatters or light fires inside”.

Broken Windows: The Case for the Hospitality Industry Now that we understand the inception and the primary logic behind this theory, how does it relate it to the hospitality industry. Let us go back to one of the two aforementioned examples of a simple process of reference check not being conducted. Hiring a person with integrity issues can give rise to a lack of respect for policies and procedures, which in turn is likely to result in loss of revenues and lower guest satisfaction. Applying the principle of the broken window theory to the hospitality industry, it can be seen that one gap in a process leads to another, and till such time that this is not checked and controlled, the likelihood of several broken windows, giving way to the entire hotel being adversely affected beyond repair, is very high. Being a very specialised industry, these gaps or broken windows can be detected only by an experienced pair of eyes, who have had strong work exposure of the hospitality industry. As part of the HVS Operational Audit and Advisory team, we share some examples of broken windows spotted by us at franchised as well as managed hotel assets over the past couple of years. These broken windows have

been observed in all forms of hospitality organisations – whether managed, franchised or run independently. Some of the examples have been appended below:

Managed Properties – International Brand •  Revenue Loss and lack of strategic guidance in Sales Function, as the Senior Leadership in Sales and Marketing did not have core experience of business development. This resulted in low motivation and high attrition rate in the Sales and Marketing Department, affecting the Hotel’s Performance (not quantifiable). •  Productivity Analysis and Return on Resource Allocation not favorable for the ownership due to the Sales Strategy being deployed by the brand. •  Human Resource Department payroll processing system found unstable, resulting in inconsistencies and overexpenditure in payroll, resulting in financial losses amounting to Rs.4.2 lac. •  Inadequate control mechanism related to Loyalty Card Programme, resulting in financial fraud by employee amounting to Rs.26 lac. •  A premier hotel property having bad debts amounting to crores of rupees because it had highly skewed manning, which was inadequate to manage the property’s revenue volumes. Additionally, there were other hidden costs in inventories and F&B at the property. •  Inconsistent Equipment Maintenance resulting in high repair and maintenance cost and also leading to guest dissatisfaction.

Managed Properties – Domestic Brand •  Significant gaps in earned revenue realisation with Net Receivables increasing by a significant 266.66% yearon-year, while Total Sales for the same period increasing by a mere 0.59%. Operator

was found managing an asset without important resources such as the Financial Controller and Credit Manager for over six months. •  Procurement process being weak, resulting in an amount of Rs.29 lac remaining unbilled in the receiving receipt register, which ideally needs to be ZERO. Pending Purchase Requests were not being monitored resulting in critical guest supplies not being available, in turn causing guest dissatisfaction. •  Inefficiencies identified in areas of Revenue Management, Structured Sales Reporting, Business Planning Process and its Implementation, Training Need Analysis, lack of structured Management Information System, Back-Office Management and poor quality Employee Facilities (not quantifiable). •  Sales and Business Plan not being used as a working document. Incomplete handover/ takeover process and a gap in continuity resulting in poor understanding of past performance, and inadequate planning for future business and rate contracting. Property reviewed was at a leisure destination, however, there was a lack of clear and structured strategy to monitor and improve employee productivity. •  No independent Mystery Audits to monitor service and product standards, no structured operations’ review to encourage benchmarking and sharing of best practices within the management group existed (not quantifiable).

Franchised Properties – International Brand •  Revenue Loss amounting to Rs. 1.75 crore, as a source of business tie-up not renewed due to management oversight. •  Inadequate Customer Relationship Management, Online Reputation Management, Unstructured Sales Reporting – all having an adverse affect on Sales Performance (not quantifiable). •  High staffing ratio result-

  FACTOIDSS

Chennai Delhi Mumbai and Agra have been the four most visited cities of India by foreign tourists during the year 2011. Worldwide, Chennai is ranked 41 by the number of foreign tourists, while Delhi is ranked at 50, Mumbai at 57 and Agra at 65 and Kolkata at 99. (Euromonitor)


02.04.2014

HICSA SUPPLEMENT 2014 HOTELSCAPES

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Predicted trends in Spa & Wellness industry NIKHIL KAPUR

SARAT VALSRAJ

MANISH DAYYA

General Manager, Ananda in the Himalayas

GM of The Zuri Kumarakom, Kerala Resort & Spa

General Manager, Novotel Goa Shrem Resort

“Rise of wellness-branded hotel chains, to far more fitness, spa and healthy eating and sleeping programming is percolating across so many more properties worldwide. Therapies in “Ayurveda” which were confined to traditional known vaidyasala (Ayurvedic hospitals) are now packaged and offered in high end five star resort ambiences which create a perfect harmony of the mind, body and soul without deviating from the actual treatment process. Organic gardens, which supply fresh produce on a day-to-day basis to cater to guest palate as per recommended dietary nutrition prescribed by the in-house consulting doctor, are another feature of the way resorts have evolved to cater to the spa segment. In recent times the new concept of healthy hotels is that the guests will be provided with exclusive choice of spa treatments, fitness facilities and healthy foods at the restaurant. Especially in Kerala, in association with the Kerala government promoting Ayurveda as a part of tourism where hotel rooms are sold with spa treatments. In the coming days the expectation is that there will be more than 50% growth in the health and wellness industry which in turn effect the growth in hospitality also.”

“The spirit of Spa and Wellness is all about offering transformative opportunities to restore sustain and optimise complete health. In order to do so, there are many novel conceptual programs like Healthy Body, Lifestyle Enhancement, Discovering your Inner self, Mind and Body Connection, Opening a sense of Creativity, Culinary workshops and Seminars. Nowadays, the level of expertise is a lot more sophisticated, comprising medical professionals, trained therapists, lifestyle coaching professionals, nutritionists and dieticians, psychologists and psychiatrists, bodywork therapists, fitness instructors, exercise physiologists, artists and creative thinkers, iconic chefs, visiting specialists, facilitators and pool and wet attendants. The clientele is more likely to be 31 to 60 years of age. Today, Spas and Wellness centres have to target the middle aged health conscious clients in search of a more balanced lifestyle and holistic wellness. Some of them seek post-illness recovery programs while others alternatively subscribe to illness preventive programs with specific concerns for their well-being.”

“The future of the Spa and wellness i ndu s t r y l ie s i n rec og n isi ng t h is need and creating experiences that allow our guest to achieve this objective. At Ananda, our philosophy of wellness centres around the healing of the mind, body and soul using the proven disciplines of Yoga, Vedanta and Ayurveda. Our masters in each of these fields use completely non-invasive methods of wellness and healing. Cuisine has become a very important element of the wellness experience and will become even more relevant in the future. At Ananda our chefs create personal menus for guests based on their “dosha”. The brief is that while the food needs to be healthy, it should be tasty and wholesome. We are also now designing menus based on foods that are good for the body during a particular season. From time to time we invite visiting masters who use healing techniques such as Tibetan Singing Bowls and Meditation, Expressive Art Therapy,  Craniosacral Work and Buqi Healing to fulfil this need of wellness seekers.” ing in high payroll cost. Our findings facilitated Staff Ratio Rationalisation. One of the tools used for benchmarking was the Indian Hotel Industry Manpower Survey, which was conducted by HVS India. Over 212 hotels had participated in this survey, across 61 cities and across all positioning. (Initial 6-months’ saving of Rs. 40 lakh). •  No action taken on Employee Satisfaction Survey. Employee Satisfaction Survey highlighted lack of motivation and low morale in two crucial Departments – Sales and Finance. The report was not even shared with these Departments. Impact – High attrition, lack of continuity in implementation of Sales and Finance process resulting in revenue loss (not quantifiable). •  Front Office Manager hired without proper reference check. Previous Employer’s morphed appointment letter was not detected by the Human Resource Department of

the property. House Accounts or Paymaster Accounts were used for inappropriate purposes and Allowances were passed without any proper justification by Front Office resulting in Revenue Loss amounting to Rs. 32 lakh. •  Exit Interviews indicated that a Senior Manager’s poor leadership was resulting in lack of motivation and ultimately high attrition. It was also found to be adversely affecting the service delivery, guest satisfaction and revenue generation. •  Dummy Vendor created to show comparison of quotations. This particular Vendor was awarded business contract worth Rs. 8 lakh in a period of three months at inflated prices.

Independent Properties

•  Lack of clarity in reporting relationships; different versions of reporting relationships resulting in conflicts and hindering the ability to take informed business decisions.

•  Absence of formalised training program at a department level. All employees were given the basic orientation followed by on-the-job learning. •  No scheduled Departmental Meetings, resulting in lack of coordination and monitoring of critical issues. •  No process linking guest satisfaction scores, needbased skills training and employee satisfaction index. •  Hotel ’s database was found to be in the form of individual excel files. There was complete absence of a centralised MIS Database. •  Ineffective capture of sales feedback and lead generation. Further to our audit, the Sales Manager of the property accepted that some of his follow-ups and sales call reports were not factual. •  Unit’s store found disorganised; surprise audit in the Beverage Stores found expired and unaccounted beverages. There was no slow moving report being circulated by

the Purchase Manager. •  No Business Plan formulated to achieve the Revenue Budget. •  No Sales Analytics to understand the market segmentations, monitor distribution channels. •  No Budget for a renovation involving Project Expenses amounting to Rs. 3.24 Crore. These examples outline that broken windows for the process reviews, do not necessarily refer to only those lapses in controls which could result in frauds, misapporporiation of funds or integrity issues. These can also be as elementary as the following: •  an unrealisitic budget or a budget without a relevant business plan; •  an investment in a technology which may not have been utilised; or •  even a non-response to a guest request Independent reviews by experienced hospitality professionals can further

facilitate in bridging the gaps in communication between the ownership and the management. The Indian hotel industry has been witnessing the emergence of several first generation owners, who are educated, extremely passionate, and well-versed with new technolgy. However, they are not very familiar with the complexities of the industry per se. Consequently, for most managed properties, there is often a significant gap due to mismatch in owner-operator expectations, leading to the foreboding risk of broken windows being created. For example, many a times, the pricing strategy as dictated by the ownership focuses too much on positioning, when market conditions may not be suitable for such a stance. On the other hand, the management may promulgate a Dynamic Pricing Strategy which may not be acceptable to the ownership. Such a situ-

ation is most likely to lead to misalignment of focus, possible opportunity losses and thereby below-par performance giving way to one or several broken windows. Independent reviewers can step in at this crucial juncture to educate the ownership about the importance of Dynamic Pricing and assist in bridging the gap between the ownership and the management. It is therefore imperative that the organisation hired for conducting such audits and operational reviews has in-depth market knowledge and their personnel have relevant hotel industry experience, so that the assessments and reviews are pragmatic with recommendations based on industry best practices. Such an exercise will not only assess but also assist the ownership and the management to achieve their business objectives. ■ The author, Manish Gaur is Associate Director of HVS India


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02.04.2014

HOTELSCAPES HICSA SUPPLEMENT 2014

Hospitality in Delhi in the coming season Vella Ramasawmy

Sanjay Sharma

GM, Kempinski Ambience Hotel, Delhi “We are the first Kempinski flagship hotel in India focusing primarily on MICE business. The first year was challenging as it was a new market for all of us, me and my team. But as summers are approaching, it seems that the first two weeks in April will witness a comparatively low business pick-up. I believe that the MICE business will pick-up by mid-April as there are some promising businesses in the beginning of the season. The summer months look positive so far and the period is apt for events like product launches, large conferences etc. In other words, the summer looks better than last year and we feel very motivated about it.”

Complex General Manager, The Westin Gurgaon New Delhi And The Westin Sohna Resort And Spa “The hotel has seen a strong Quarter 1 for 2014, with a 7% increment as compared to Quarter 1. 2013. This can be largely attributed to the buoyancy in the market sentiment with respect to higher FDIs. We see this trend continuing into the summers where the pace for bookings is stronger in comparison to last year. The domestic market has shown resilience when the west was down and out. This coupled with strong international players entering or engaging with prospective buyers should create an opportunity for all.”

Meena Bhatia

Satyajeet Krishnan

Vice President Marketing & Operations, Le-Meridien, New Delhi “Business in the coming two quarters looks tough and unpredictable due to uncertainty of the political situation. Post elections, and as trends show, in the event of an alliance, the fear of lack of stability will continue. Hence Quarter 3 and Quarter 4 will not see much growth. Foreign investors, corporations and major deals and sign offs will be on hold. Internally the industry is already in pressure due to increase in supply and with demand declining, the pressure will mount. We are optimistic though that Quarter 4 will show recovery, once the elected government starts announcing new economic and foreign policies and indicates positive growth opportunities.”

General Manager, The Taj Mahal Hotel, New Delhi “The business scenario for hotels during the summer season has changed over the last few years. Earlier Delhi was considered a 6 month destination however the scenario has evolved across various segments of business in the past few years. Owing to one’s busy schedule, people are now opting for short weekend stay-overs at luxury properties which give them the feeling of being on a holiday and help them rejuvenate in a shorter span of time. The months of May, June and July are generally lean for the hospitality sector and hence we introduce special summer package and promotions for our guests during these months.”

ITC Hotels builds Kaya Kalp as the ultimate spa brand in hospitality

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mbraced by serenity, tranquility and unhurried pampering is ITC Hotels well known Spa Brand – the Kaya Kalp. Available at all ITC luxury Collection Hotels, Kaya Kalp Spas promote well-being and healing of the mind, body and soul with a variety of therapies. The Spa aims to recapture the spiritual and medicinal legacies from all over the world which includes time tested spa therapies as well as a number of indigenous therapies of the East. The specialists are trained to identify individual body types and suggest treatments that help increase circulation, remove physical tension, nourish the skin and leave one with a sense of well-being, relaxation and rejuvenation. Among the signature rituals offered are Exotic Pomegranate Spa Journey and Passage to India Spa Journey. These therapies are based on Swedish massaging techniques and signature pomegranate sugar scrub that uses hand made products to smoothen and polish the skin. Also, available are the de-stressing therapeutic Hot Stone Massage and Tension Reliever Massage. Kaya Kalp – The Royal Spa at ITC Mughal, Agra - the crowning glory is spread across an area of more than 9200 meter square. It is inspired by the Mogul’s love for aesthetics, exotic therapies and the reverence for the renewing powers of aqua pura. It is also the first spa in India to offer a complete Mughal Style Hamam. The design of the Spa is a close synthesis between indoor and outer spaces highlighting many influences

of Mughal landscaping and architecture. The Pomegranate fruit has been adopted as the theme of this Spa. The ruby red pomegranates are an important design element used on the walls, ceiling and the white terrazzo flooring of this Facility. The Spa features eight treatment rooms including a Royal Mughal Hamam and spa suites, with a personal plunge pool and outdoor rain water showers. In today’s context, it seeks to recreate the opulence and luxurious lifestyle of the Mughal Dynasty, where nature plays an essential part of the treatment. A spacious state-of-the-art Fitness Centre offers a view of water bodies while a bird trail, butterfly parks, orchard walkways and an aqua pool with palm islands, add to the enchantment of the Spa.

Kaya Kalp -The Royal Spa was recognized by UK’s Tattler Magazine, as the “Best City Spa of the World” in 2008, Asia Spa has also recognized the Spa in the categories of the ‘Best New Spa of the Year’ in 2008, ‘Best Spa Marketing Award’ in 2008 and ‘Best Spa Interiors’ in 2009. In addition, the Royal Spa also bagged recognition at the AsiaSpa Wellness Spa Festival in Malaysia, as the “Best Resort Spa” in 2009. Kaya Kalp Spas are available at the ten exquisite ITC Luxury Collection Hotels that include ITC Sonar, Kolkata; ITC Kakatiya, Hyderabad; ITC Maratha and ITC Grand Central, Mumbai; ITC Maurya, New Delhi; ITC Gardenia and ITC Windsor, Bengaluru, ITC Rajputana, Jaipur, ITC Mughal, Agra and ITC Grand Chola, Chennai. ■

  FACTOIDSS According to provisional statistics 6.29 million foreign tourists arrived in India in 2011, an increase of 8.9% from 5.78 million in 2010. This ranks India as the 38th country in the world in terms of foreign tourist arrivals. Domestic tourist visits to all states and Union Territories numbered 1,036.35 million in 2012, an increase of 16.5% from 2011. The most represented countries are the United States (16%) and the United Kingdom (12.6%). (Minisrty of Tourism)

In 2011 Maharashtra, Tamil Nadu and Delhi were the most popular states for foreign tourists. Domestic tourists visited the states Uttar Pradesh, Andhra Pradesh and Tamil Nadu most frequently. (Ministry of Tourism)


22 Kempinski sets its sights on the gems of Indian hospitality HOTELSCAPES HICSA SUPPLEMENT 2014

02.04.2014

Kempinski first entered the Indian market more than 25 years ago, when it partnered Leela Hotels. In end 2012, it opened its first hotel in Delhi.

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reated in 1897, Kempinski Hotels is Europe’s oldest luxury hotel group. Kempinski now manages a portfolio of 75 five-star hotels in 32 countries and continues to add new properties in Europe, the Middle East, Africa and Asia, and has shown particular interest in India, one of the fastest growing luxury markets in the world. Hoping to build on the success of its fruitful partnership with Leela, and the impressive launch of its first hotel in Delhi, Kempinski is seeking opportunities to expand its portfolio of luxury hotels on the sub-continent. Kempinski first entered the Indian hospitality market more than twenty-five years ago, when it partnered with Leela Palaces, Hotels &Resorts and opened some of the most luxurious hotels on the sub-continent. After working with Leela for more than two decades Kempinski opened its first hotel in Delhi at the end of 2012 – Kempinski Ambience Hotel – to great acclaim. Capitalising on the growth of the MICE market in India, Kempinski Ambience Hotel closed its first year of operations as a notable standout in the MICE market in Delhi. With a state-of-the-art ballroom that can accommodate up to 6000 people for special events, celebrations, and conferences, the hotel has become the top venue in Delhi for major events. But the largest banquet space in the country is just a minor factor in the success of the property…Kempinski’s world-renowned service quality is exactly what India’s discerning luxury customer is looking for when it comes to a hospitality brand.

The Kempinski global portfolio is a carefully curated collection of historic landmark properties, award-winning urban lifestyle hotels, outstanding resorts, and prestigious residences. According to the European hoteliers, India provides ideal opportunities for the luxury group to find an array of stunning properties that will complement its growth and development strategy for the next five years. “India is an exciting market for us to explore because luxury consumers in India understand the values of craftsmanship and individuality that underpin Kempinski’s definition of luxury” said Ulrich Eckhardt, Regional President for India, Middle East & Africa. “Kempinski has been the brand of choice for savvy Indian travellers to Europe and the Middle East for many years. Growth in the country will continue to expand the luxury segment and we are looking for the right properties to cater to discerning business and leisure travellers in India.  From beautiful palaces in Udaipur to modern city hotels in Mumbai and Bangalore, this market plays a large part in our growth strategy for the next decade.” Mr. Eckhardt continued, “India is not a new market for us. We have been enjoying business from India for decades in our hotels across the globe, and our relationship with Leela laid a great foundation for the growth of the brand. We are confident that we will be able to build on this experience and recruit the best people in the business to operate our hotels here in order to stay one step ahead of the competition.” Kempinski is in talks with potential partners to operate

Farhat Jamal moves to Shangri-La Delhi, to strengthen presence of iconic brand in India We bring you excerpts of an interview with Fathat Jamal, Area Manager and GM, Shangri-La Eros Hotel, New Delhi. Here he talks of the challenges facing the Indian hospitality industry.

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hangri-La New Delhi has several strengths. It is centrally located, in the heart of Lutyen’s Delhi in close proximity to several important landmarks such as Connaught Place, India Gate, most central government offices and historical tourist attractions. Our global presence is a big positive and helps us generate, build and grow our business from key source markets such as US, UK, Europe and the Far East. We also take pride in our group’s Golden Circle guest Loyalty Programme which is very powerful and has over 2.3 million members. What are your plans for India as a group? In 2014 we plan to open our first Shangri-La Hotel in Bangalore followed by Shangri-La Palm Retreat also in Bangalore in 2015. We believe India is a strong and important market for us and we are committed to growing the Shangri-La

Brand in the future. At this time we do not have any plans of opening another hotel in Mumbai but should a right opportunity arise in the future we will certainly evaluate it. Mumbai is an exciting city and we are proud to be associated with it. Would you like to comment on your exiting the Paladium property? I do not wish to comment on the erstwhile Shangri-La Hotel, Mumbai because of confidentiality obligations. What makes the ShangriLa brand a proposition? The key differentiating factor for us at Shangri-La is our ability to bring global expertise, innovation and quality. My culinary team at our All Day Dining Café Uno serves the finest food from interactive buffet stations and we lay huge emphasis on the freshness, taste, variety and our presentation of the dishes. Going forward we intend to renovate our Food and Beverage outlets and bring in new culinary

FARHAT JAMAL

Area Manager and GM, Shangri-La Eros Hotel, New Delhi At this time we do not have any plans of opening another hotel in Mumbai but should a right opportunity arise in future we will certainly evaluate it. Mumbai is an exciting city and we are proud to be associated with it.

concepts that will be cutting edge and unique to Delhi. We are currently working on these ideas and hopefully will start

implementing the changes later this year and complete the entire makeover some time mid-2015.

ULRICH ECKHARDT Regional President for India, Middle East & Africa

Hoping to build on the success of its fruitful partnership with Leela, and the impressive launch of its first hotel in Delhi, Kempinski is seeking opportunities to expand its portfolio of luxury hotels on the sub-continent.

some of most iconic hotels in India’s growing urban centers, as well as a few hidden gems around the country. Building on the long-standing service traditions that showcase the charm of India, and Kempinski’s track record of expanding into new markets such as the Middle East and Africa, which now account for more than one-third of the company’s total revenues, the luxury hotel management company is confident that it will eventually become a market leader in luxury hospitality in India. ■ Building and running hotels in the country is not getting any easier. What in your opinion are some of the challenges? One of the greatest challenges that the hospitality industry faces today is the availability of trained and talented manpower. While many hotel schools have come up in the past few years it may be prudent to understand that the quality of education provided needs a much desired improvement. We may need to ask the basic question about how welltrained are today’s youth before they become good hospitality professionals. At times I get an impression that there is a lack of long term commitment from the new generation of hoteliers to the business. Where in lies the problem and where are the solutions? I do not blame them as they are blessed with choices. This has also to do with a lack of ongoing and proactive dialogue between educators and hoteliers. The educators must be brought to the mainstream. I strongly feel they are been left behind by the hospitality professionals. They need more active support and greater participation in the changing landscape of the business. The industry

has to realize that loyalty to organisations will continue to shrink. I always want to keep the excitement going for the newcomers to the industry. They are going to get bored very quickly if we conduct our business like we did a decade ago. They must be engaged and enthralled most of the time. Another area, of major concern, is the cost of managing business. This is particularly relevant in view of the spiraling energy costs in India. Hotels will have to work on efficient energy systems and invest in technology and explore alternative green and sustainable energy sources. Many environment friendly initiatives are capital intensive initially but the pay back is fairly quick provided there are no overruns and timelines for completions are met. Hotels will have to focus on this immensely, going forward. What role are you visualising for technology in your operations? Our interventions in bringing the latest technology at Shangri-La are second to none. Very few hotel groups other than Shangri-La provide free internet access to guests. To me it is like providing running hot and cold water or watching TV programs free of cost. ■



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