UNO July 2020

Adaptation and trust-building to combat uncertainty

We have dealt with complex global scenarios in the past and we have emerged stronger from them all to stand where we are today. That said, this pandemic is having an unprecedented impact in terms of the threat it poses for society, health and the economy. The tourism sector in general and the hotel sector in particular went from posting alltime record business figures to complete shutdown basically within the space of just a few days following declaration of the State of Emergency. It led to a worldwide mobility shutdown unlike anything seen before in the history of this industry.

Four months later, and with the recent return to an uncertain normality, the sector is trying to reinvent itself and faces an even tougher task ahead: reversing the process as soon as possible and regaining lost ground. There are certain external factors beyond our control in this endeavor, but the ability to adapt shown by our leaders, the flexibility of our operations models and our capacity to build trust represent the key levers on which to ensure our future viability and accelerate a business recovery.

At NH Hotel Group, the well-timed operational and financial transformation we undertook in recent years combined with the contingency measures put in place to protect liquidity during the most critical stages of this healthcare crisis have enabled us to overcome the worst of the market turmoil (April and May) with practically our entire portfolio closed. The exercise in adaptability that was successfully applied both ahead of and during this situation was key to tackling the current context with increased confidence in the future. Centralized management models and a commitment to technology and efficient systems will allow us to achieve levels of profitability at lower occupancy figures than before and, therefore, return to stability sooner.

We have made changes to almost 700 operating standards at our hotels entirely aimed at protecting people’s health

At the same time, rebuilding trust has become our main priority in designing the gradual process to reopen our hotels. Protecting the health of travelers and employees and doing so in safe environments where we can continue to offer a service that exceeds customer expectations, is key to recovering our business. The solution has involved redefining the customer experience, from the moment they think about booking accommodation with us, through the time they spend at our premises and right up to the end of their stay. Under a comprehensive analysis and measures plan encompassed by the Feel Safe at NH concept, for which we received support from SGS – a global leader in health inspection and certification, we have redefined our sanitary control protocols and the value proposition we offer to travelers so that our establishments all over the world can be safe environments.

Undertaken in record time, this has involved a complete redesign process in which new digital solutions will become common practice for new customers. Besides such initiatives as adapting sanitization processes and incorporating social distancing rules, the use of technology and the digitalization of hotel tasks and services are allowing us to minimize contact risks while improving the experience by enabling customers to easily manage a large portion of their interactions with the establishment via their mobile device. For example, the Fast Pass service combines the option to check in, choose a room and check out while reducing the need to complete these steps in person at hotel reception. Other services can also be managed while staying with us, such as room service or requesting breakfast, which can be done easily and intuitively via an app that will be opened in the guest’s mobile browser as soon as they connect to the hotel Wi-Fi. In short, technology is helping us convert a problem into an opportunity to improve the experience and build trust at the same time.

Besides this commitment to technology, we have had to adapt our operations to current requirements by making changes to our catering services, implementing the use of protective equipment for all employees, providing specific safety training to the entire workforce, adapting the cleaning procedure and even applying new air and water treatment control measures in our hotels. In summary, we have made changes to almost 700 operating standards at our hotels entirely aimed at protecting people’s health.

Against such a volatile backdrop, nothing is more urgent than swift decision-making and strategy implementation, management model flexibility and effectiveness

These are just some of the steps needed to flexibly, pro-actively and swiftly tackle the current need to reinvent and adapt our business to this temporary situation. It is too early to say whether more major changes will be needed in the long term. In the short term, it is a question of continuing to provide the basic services, building consumer trust and ensuring consumers regain a desire to travel, safe in the knowledge that they are running no unnecessary risks.
That is why we began to gradually reopen our hotels in major destinations at the start of June, mainly concentrating demand in each city at those establishments that allow resources and profitability to be optimized. Due to the uncertainty that still exists today, our outlook remains cautious. We believe that business will initially come from domestic demand and we will support ourselves on our strong presence in major European destinations to promote international travel when international mobility increases again.

A coordinated response from the sector as a whole is also needed. Survival of the business fabric must be guaranteed in order to prevent a prolonged economic impact from causing part of that fabric to evaporate and, hence, significant job losses. Although the health crisis does indeed present numerous unknown factors for the future of tourism, financially sound companies with the capacity to quickly adapt in terms of technology and a strong customer focus will be the most likely to withstand this crisis and be more competitive in the future.
Against such a volatile backdrop, nothing is more urgent than swift decision-making and strategy implementation, management model flexibility and effectiveness, the use
of technology to reveal traveler behavior and motivations, and trust-building exercises with all stakeholders. In short, it is a question of anticipation, adaptability, efficiency and communication, an exercise that NH Hotel Group has undertaken with responsibility, determination and responsiveness.

Ramón Aragonés
CEO of NH Hotel Group
Studied Hospitality and Tourism at the University of Palma de Mallorca, the International School of Hotel Management and Tourism Business in Leuven (Belgium) and the Palma de Mallorca Higher Centre for Hospitality Studies. He has enjoyed an extensive professional career in the world of tourism. He has been CEO of NH Hotel Group since January 2017. He leads all areas of the company and is responsible for compliance with the strategic plan, expansion and development of the various lines of business and consolidation of the group’s brands. Between 2000 and 2009, he was CEO of Hesperia. Between 2011 and taking up his current post, he was General Operations Manager at NH.

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