REPORT FROM THE U.S.—A large number of third-party management companies have diverse portfolios demonstrating their experience operating a variety of hotel brands, but how does a management company learn the ins and outs of operating a particular brand it has never worked with before?
Establishing a relationship with a new brand requires significant training for a third-party management company, but the process is not as demanding as it may seem, according to executives of Paramount Hotel Group.
When making the decision to get involved with a new brand, understanding what the various brands in a particular segment have to offer a market is important, said President of Paramount Hotel Group Ethan Kramer.
“In most cases, you’d want to go with the brand that would provide the most to you in terms of reservation support. What brand can do the most for me?” Kramer said.
Learning the standards for a new brand is not a difficult process for a third-party management company because of the many similarities between the various brands, said Peter Marino, Paramount’s senior VP.
There are slight differences, maybe a 10% variance from one brand to another in the same segment, Marino said. “A real difference would be you have to serve breakfast at dinnertime.”
Paramount has 53 hotels in its portfolio, representing brands such as InterContinental Hotels Group, Starwood Hotels and Resorts, Choice Hotels International, Hilton Worldwide, Marriott International, Wyndham Hotel Group and Carlson Hotels.
Most management companies that have been around for a considerable amount of time know the offerings for a Holiday Inn, Sheraton, Marriott or Hilton. There might be some minor tweaks that slip through if the management company is not involved with the brand at the particular time, but it’s not difficult to navigate through, Marino said.
A brand approval process
Brands do require a review and approval process for management companies before allowing them to operate one of the brands’ properties, said Rob Palleschi, global head of Hilton Worldwide’s DoubleTree by Hilton brand.
Hilton uses an internal online tool to assess the management company’s background and experience.
Once the third-party management company is approved, Hilton provides an orientation in which the management company gets an overview of Hilton Worldwide and learns about the available tools, services the specific brand provides and the brand expectations.
A more extensive brand-specific training is provided to GMs, equipping them with the tools necessary to oversee the day-to-day operations at the property, including the presentation of the signature DoubleTree by Hilton chocolate chip cookie to arriving guests. “Some (GMs) could be experienced with Hilton Worldwide, but they have to go through a GM leadership orientation with the brand,” Palleschi said.
The GM orientation is a weeklong program that sets the foundation for what the brand is looking for in terms of standards, he said. But the education does not end there. “It’s not just the orientation and then we leave … all of our brands have what we call brand performance support,” Palleschi said.
The responsibility of the individuals who work on Hilton’s brand performance support team is to provide guidance to all properties of a particular brand within a specific region. They are a one-stop for the operators to connect to the brand and to connect to Hilton Worldwide, Palleschi said. “If you’re a new GM or an existing GM, and you’ve got questions relative to standards or an upcoming renovation, you can connect with your regional performance support.”
Palleschi said the great relationship Hilton has with its third-party owners and operators is reflected in the fact that many new hotels that come into the Hilton system are from owners and management companies that already have existing relationships with the company.
“All brands have good points, and all have soft points,” Marino said. “We need them all. We need the brands because that’s what brings business to the table.”
