The average general manager at Hyatt has been with the company for 23 years, Hoplamazian noted, and housekeepers, janitors and other service professionals tend to have long tenures as well. “I believe they relate to Hyatt in a human, emotional way,” Hoplamazian stated. “They are not thinking about cost elasticity or all these things financial people think about, but [about], ‘How do I really do something that a customer would like?’”
That mindset, he added, is very different from the outlook of many product-driven firms, where staff is primarily focused on getting the next shipment out on time. When Hoplamazian was first starting out at the company, he tried out each hotel job just to see what it was like. He recalled meeting a particular front desk employee and being taken with his enthusiasm. Hoplamazian asked the front desk worker how he kept it up day after day.
“He said that the emotional experience he would get when he helped out a customer was nothing less than the reaction you see [from] a new puppy wagging its tail,” Hoplamazian noted. “It is my job to manage employees like that.”
Although the economic downturn in 2008 and 2009 was a challenge, Hoplamazian said it was not the disaster for Hyatt that it was for companies in many other industries. In its most recent earnings report, the company reported a 5.4% gain from a year earlier and an 8.3% increase in revenue to $1.01 billion. According to The Wall Street Journal, the firm is one of several US hotel companies that are expanding significantly overseas in response to an increase in demand, particularly among business travellers.
Hoplamazian attributes some of Hyatt’s staying power to his decision during the downturn to continue paying out bonuses promised to employees at a time when many other companies were cutting out extras. “My own principles and what we had committed ourselves and our people to were tested,” he said. “But it had a gargantuan impact. You could see people knowing how serious you were about loyalty even in the face of challenge…. What you demonstrate to others when you are pushed is what makes the difference in leadership,” he added. “That one thing has [solidified] employee loyalty now that things have turned. It did not cost that much, and it showed that the leaders of the company were loyal when we needed to be.”
When former Pennsylvania governor and US Secretary of Homeland Security Tom Ridge was the guest speaker at one of Hoplamazian’s hotel conferences, he asked Hoplamazian what he had learned from being a CEO. Hoplamazian stressed authenticity, being a good listener and loyalty. “Ridge latched onto that and said that when he was in the military, he found that rank gives you compliance,” Hoplamazian noted. “He said that because he had rank, he could tell people what to do, and they would do it whether they wanted to or not.
“But that doesn’t get you their hearts and souls, and [Ridge said] that you have to make sure you get that, too,” Hoplamazian added. “Compliance doesn’t get you there. It is how you show up and relate to people day-to-day that matters.”
Hoplamazian noted that he had to prove himself as a good leader to Hyatt employees when he first took the CEO position. He arranged to attend regional managers meetings as a way to introduce himself to the staff. At the very first of those gatherings, which included about 25 general managers, “I felt like I was getting grilled from the start. It was clearly not warm and fuzzy.”
On the morning of the second meeting, Hoplamazian took aside a manager he had known for a while and asked that person what was going on, and if he could expect the grilling to continue. The manager replied, “‘Oh, they just wanted to see if the rumours were right, if you were going to ask questions and really listen,’” Hoplamazian noted. “The rumour mill had already started, and I had now gotten the stamp of approval….
“The important thing is to engage employees. Don’t go in saying you know this and you know that, and this is the way it will be,” said Hoplamazian. “Listening is critical to leadership, and so is staying authentic. You do that and you will get loyalty, and then your role as a leader will be easy.”
