Master of change

Numerous changes are afoot at Pan Pacific Hotels Group (PPHG), led by Lothar Nessmann who took over the reins as CEO in February 2017. He talks to Karen Yue about pushing for changes that take the organisation forward, adopting technology applications that make sense and keeping the critical dance with travel agents going

Every new leadership opens a door to new ways of doing things. Are you looking at changing things now that you’re at the helm?
New leadership does bring something different but there must be an objective for that. The difference must be a positive one, and we must be able to calm waters when there is change and get everybody involved and on board.

Everybody has to see the endgame, and understand that sometimes a different road needs to be taken in order for the organisation to move forward.

You mentioned having to calm waters when there is change. Did you see churning waters when you arrived into this new position?
Oh no, not at all! It’s just that when somebody new arrives, even a new general manager at a hotel, everybody wonders who (he is) and how (things will be). It is normal.

What are some of the changes that you have set in motion?
We recognised that we needed to put more emphasis on our website and booking engine. We recognised that we needed our front-facing pages to be more customer-oriented and to portray ourselves to be more in line with what the customer is looking for. We also recognised that social media is an important channel, so we’ve stepped up our efforts there.

Digital is another important aspect of the game, so we’ve put more emphasis on that.

On the hardware front, together with our owners, we have and will continue to invest quite significantly in a number of our key properties for renovations and upgrades. We will even change some of our F&B concepts in some of our hotels.

These will take place over 18 months, three years and five years – one cannot make these changes immediately.

At the same time, we recognised that all of these changes would not pan out if we did not bring a definite change to our service, software and human capital.

The service offered by our hotels is very good. Can we do more? Of course! And that’s what we aim to do. Together with a professional company and a lot of our own senior managers, we have built an employee service culture training manual that is specific to our needs. This took us several months to put together.

We have hotels in different parts of the globe, so the way we portray this service culture and the way we deliver this training to our employees need to be localised. We don’t want to have a one-size-fits-all because our employees and customers are different in every hotel.

One of the key points about our training is that it is first given to our senior management. Not only did they build the course, they were the first to receive training when it was launched in June this year. The training course then cascades down to the employees, with training conducted by the senior team. This shows buy-in by the senior team. We wanted to create an emotional attachment to this course.

The other benefit of having our senior team conduct the training is that they can give relevant, real-life examples to emphasise a point.

Does your social media effort include influencer engagements? It is common for such engagements to come with direct booking motivations, such as through a promo code. Doesn’t that add to travel agents’ ongoing fight with direct bookings?
Social media is a large part of life and we need to embrace it. Have we worked with influencers? Absolutely! Our marketing team identifies which influencers are a right fit with PPHG.

This has happened because of technology and the change in people’s aspirations. They are looking to be inspired and influenced by others.

Influencers bring a new business opportunity but that does not mean we won’t continue to use all the other channels familiar to us.

Travel agents need to embrace this shift. They could themselves see advantages in engaging influencers too.

How about changes in innovation at the back- and front-end?
Our industry – any industry for that matter – has to keep innovating. But we need to understand if the technology is something the customer wants and understands.

We have seen hotels using robots. We have one too at Pan Pacific Beijing, and it’s called Peter Pan. It is quite fun, and the young children like it. The robot is extremely efficient but I do not see it taking over all service roles.

In the meetings and events space, innovation is vital. The days of hotels packing out projector screens and a projector are long over.

I love how PPHG’s ongoing global brand refresh includes a localised strategy and action plan for each market, built with local agency partners. Is this indicative of the continued importance of travel agents in the travel and tourism industry?
Travel agencies are our partners and we are clear about how very important they are. We are here to do business with them.

The relationship between hotels and travel agents have changed over the years because of technology and customer needs. I see both parties evolving together to keep in line with customer demands. Travel trends and habits are changing so rapidly that hotels and travel agents need to work together to do better business.

You’ve been in the hospitality business for 30 years. What are the biggest changes to the regional hotel landscape, and how do you see it evolving next?
Here in Asia-Pacific, there have been very powerful hotel players 20 years ago that are no longer as powerful today. And in the past year, there have been two or three hotel companies that have become very big, very powerful. They will continue to grow where they can. There is no doubt that these very large players, because of their booking system, back-of-house infrastructure and sheer size of their customer base, will dominate the market.

Having said that, PPHG is part of the Global Hotel Alliance which is also a very powerful organisation made up of many other small and mid-sized hotel companies. That gives us some power to fight the giants.

While these large hotel companies are here to stay, they will also change their shape as time goes on. Look at the news today – one of them is looking to offload some of its Australian properties.

What power does PPHG have over these mega hotel companies?
To get things done across the board for 40 properties, as opposed to several hundreds, will be faster, of course. Having said that, it is all about the people who are executing programmes and changes on the ground.

I think another advantage of ours is that we can afford to be more personal.

Have you also seen changes in the way hotels are built today compared to decades ago?
At PPHG, we work very closely with our contractors and architects on environmental impact. The new property that will take over what once was Pan Pacific Orchard (closed since April 2018 for a three-year redevelopment) will have a zero-waste capability.

Hotel companies need to be more conscious about the impact their properties have on the environment. Hotels consume a huge amount of water and energy, and generate a huge amount of waste.

Hotels today also are no longer being built with five or six restaurants. Now, one or two only. In the past, customers were happy to stay in the hotel, hence all the services were created to keep them occupied. Today, customers just want to go outside.

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