Lessons on Leadership | Laurence Bloch

Today were speaking to Laurence Bloch who is the director of the Hotel Plaza Athénée Paris, one of Paris’s most iconic palace properties. Laurence Bloch, thank you for taking the time to meet us today to talk about your insights and also foresights about where the ultra-luxury and hospitality Industry is heading in the future. Maybe to begin with, in your own words could you share your own experience in the ultra-luxury hotel industry please ? Sure, with pleasure. First, I had different positions that helped me understand all of this field, because you have maybe eighty different jobs in a hotel, in F&B, back of house, so I think it’s very important to really have different experiences around the hotel. It gives you a helicopter view of what you are doing. Also my family background helped me, because my mother is an art dealer, and my father is an industrial, and it gave me aestheticism, a certain vision of what is Beauty, and in the luxury market I think it helped me a lot to work in a palace like the Plaza Athénée. Could you perhaps elaborate what your Hotel Director position is all about, what does it entail and in which way do you support a hotel’s operation? First you have to be a leader. What I mean by that is you have to be inspirational, you have to take decisions quite quickly but mostly the hotel industry is based on people, so you have to have some empathy. I’m talking about the employees and also the guests too so you need a lot of energy. A hotel like the Hotel Athénée has 550 employees and 550 personalities, and of course the guests, with so many nationalities that we have, so a lot of energy and empathy I would say. If my count is correct, you’ll have been at the helm of The Plaza Athénée for 20 years next year, is that correct? Yes, part of the furniture. Part of the furniture, a true hotelier who is constantly present, who is very much involved in all aspects of the operation with a strong focus on also the soft touches that you’ve just mentioned. What in your opinion are the skills of becoming perhaps a Hotel Director of tomorrow? I think nothing has changed about that, I think you still have to have curiosity and it really makes a difference. I always say to the new entries, what you put into school or a company is what eventually you will get out of it. First is the curiosity and second is the engagement, if you are engaged for a school, for the company then it will advance you further and it could be in any field. Curiosity is very important, the engagement, and maybe the only thing that has changed a lot more than with our parents is the agility. The way you have to adapt yourself to the new environment, it can be in any field but really the agility to react. Talking about adaptability, how do you know or how do you question if you are still doing the right things to stay on top of your game with an ever increasing competition and sometimes very disruptive new market entrants ? I always say to the new entries and new employees, I’m a little bit like Dracula. So I need your fresh blood your fresh ideas, the way you are thinking about the world. It’s very important for me that all these new people are aware of what’s going on and what will be the future, because I don’t carry the future anymore, it’s really the new employees. Of course the benchmark, I’m not talking about the benchmark in the hotel business or in our competition, of course we have to see what they are doing, but mostly in other fields. For example, a few years ago I went to see LVMH Human Resources in China to see what was their challenge and to see if it was the same challenge as we face. I’m part of Comité Colbert, it’s the 70 most luxury brands in France and I’m in the HR commission, and we really look at the same, if we have the same challenge even if it’s not all the same kind of industry, so I think benchmarking is another away. And the third way I would say is the expertise of the Dorchester Collection in helicopter view, because they are the umbrella of our ten hotels and they really have a vision in some areas about what will be the transformation, and we’re really working on this transformation. So these three ways I think keep us, and me, on the top. In your words, what is your definition of ultra-luxury travel and experiences? You can have so many answers but for us, I would say it’s a legendary way of life in the city where you are. And by that I mean, you know people travel all over the world, can have the same thing everywhere. If I think about brands that you can have, a Christian Dior in Paris or in Tokyo, and you will have the same thing, the same experience, the same items. So I would say that in Palace you really have to keep what made and makes you a legend as an iconic hotel, to offer what is the best in terms of F&B, Spa, design and location. That’s very important, and have the real flavour of what Paris is offering. In what other ways has the ultra-luxury travel landscape changed in terms of what the affluent customer wants and is looking for today? I think they want the Moon. It’s really becoming more and more difficult because they want the ultra-bespoke service, they want everything for them, only for them, different from what their friends had and get, and in a world where, and especially here at the Plaza, we have 30% of our guests coming from the Americas, 40% from Europe and 25% from the rest of the world, we have 100 nationalities and they all expect something different. So it makes it quite difficult to surprise them and to find our way but I think new technology helps us in doing some bespoke experiences. What they also need that is changing, and has been changing for 20 years, is time. They don’t have time and they don’t want to lose it. And if they do have time, it’s only to experience something, but otherwise they want something effortless, they’re really looking for that. Could you provide us with an exemple that you adapted to the customers’ needs, What was the trigger? What was your thought process and what was the outcome? First, when when I arrived 19 years ago, we tried to find out what was the DNA of this hotel, and creativity was really something coming out. So we created a bar, this bar is the trendiest in Paris, we really blend the heritage of the wooden panels with the innovation of Jouin Manku design and with the DJ. so really it was a very innovative bar. It still is, even if some competition have tried to copy, they never went as far, and what we wanted to achieve is to attract the younger generation who will be the future guest. We really wanted to attract them, the new generation. The outcome of it was we multiplied by ten the revenue. So that was really something. Then, we really wanted to… We closed four years ago and really wanted to put back the elegance into Paris, 5-star hotels and we really worked on that. Paris is well known for its gastronomy and its elegance, and we really wanted to have both at the top, so we got Alain Ducasse. We were also the first one to appoint a three-star Michelin guide chef in the hotel, 19 years ago. And then we were copied. We really wanted to put elegance into this hotel, we worked a lot on that and we decided to position the hotel as the ‘couture hotel in Paris’, and it really meant something. What it brings us is really a different position and because we are on Avenue Montaigne, it’s really positioned ourselves with this link of fashion and haute couture. And with the Dior spa and I think we are now well-known as a very feminine hotel and it puts us in a different position than our competition, helping us to be well-known worldwide. Now to answer the question of the different nationalities and what they expect. I think we have to adapt ourselves to our guests of course. but we shouldn’t ask them what they are expecting, we should know what is our DNA and stick to it. I think that’s very important. I was in a hotel in LA and they had recently refurbished, they were very proud of their refurbishment, I found it was quite old. I ask them ‘How did you do your design ?’ And they told me ‘we asked the guest and they said don’t change anything, so we didn’t change anything, we just a refurbished it but the same way’. This is normal, when guests like a place they don’t want to change anything. But you end up looking 10 years out of date. I think you have to know what is your DNA and then know what is the perspective in 10 years, and what the guest wants, maybe you’re wrong, but don’t be Asian, American, or English or Russian. Then, of course, in terms of experience and service you can adapt yourself and that’s what we’re going to improve, because we are in a transformation process. I know that transformation is a trend, but we’re really going to transform ourself in the way our organisation is run through technology, and it’s coming. Speaking about human capital, how has the Millennial mindset impacted the way you attract, hire, and how you retain, your employees? We are quite lucky at the Plaza Athénée because the DNA of the hotel, goes very well with what Millennials are expecting. We have a chart that shows that we want to work, as a team and not depend on the position or level of the position. When you need to work together, you work together. And that’s really the DNA of the hotel and of the General Managers that work inside the hotel, but also at the Dorchester Collection. Secondly, we always try to explain the ‘Why’, which the new generation really want to get, it’s always the ‘Why’. And also we’re not afraid to have a head of department that is 22 years old. we really try to show to the employees of the hotel that promotion is very important to develop the people. We have three head of departments that were trainees at the beginning, and we worked last year with all the head of departments on strategies about how we can attract new employees, and what is our DNA in terms of promise, the promise for the employees. We came up with Once Upon a Time, The Talent of Tomorrow and our vision globally for the hotel is Once Upon a Time The Palace of Tomorrow. Through different actions we really show that it’s the truth that 30% of our employees came through internal promotion, most of the F&B Managers that came here became General Managers all over the world, we really think that promotion for the newcomers is something that will be very powerful. This year, we’ve worked on how we will show that to the new entries, and to explain what is our promise for them. The Dorchester Collection and Glion have a long established relationship, could you share your experiences with Glion students? We know that there’s currently Glion students working in the hotel, one has finished Glion and is now working as your number two in Room Service. Could you just share some insights about your experience with our school? So we have had different experiences with Glion. First I looked at it and we had like twenty trainees in the past five years since the reopening, as you mention we have someone who is number two of Room Service. What we love from these students is the range of knowhow and their education. I think it’s very important the way they act and react and work, so the level is very good. We have also a program called the ULP, the Ultimate Leadership Program, It’s two years as an employee in different departments and after two years you become a manager in the hotel or in the company. It’s a great opportunity for your students to become a manager. Also I come twice a year to explain the business strategy of the hotel to your students for a full day, and I think is a great collaboration between our two companies. What would you consider we as an industry need to do to make a career in hospitality a lot more attractive? What are we doing wrong? What do we need to stop doing? What should we start doing? What should we continue doing? Ok, first I think we should raise the salaries. I agree! Secondly, a better balance between the professional and private life. I think the hotel business and F&B are well known for very extensive hours and the Millennials now they think private life and personal life are equally important. The hotel business is not adapted to this aspiration of the new Millennials, we really have to pay attention to the connection, to the hours, and we really do it. If we think about the last fifty years there is really an improvement and we are obliged to go further in order to attract. About the salaries, it’s an industry where you need a lot of employees, you are open 24-hours a day, to really please the guest you need to have 2.5 employees per room, so it’s very difficult to increase salaries, but I think it’s really the promotion that will help to attract the new Millennials. I think it’s a business that should attract the Millennials because you will find some job, it’s really something that people are looking for, the hotel business can really offer you a worldwide job and a career. So, now back to Food and Beverage. Food and Beverage has in the past been a very unprofitable amenity in hotel operations, it’s very labour intense, very cost intense, it’s very low profit. What role has F&B taken with the rise of social media at your hotel, and perhaps also from a Dorchester Collection standpoint, how important has it become? I think it’s central, F&B in the Palace shows if you are part of the city or not, so you really need to have different outlets that can please people who want something on the spot or want to have something more fancy like three-star. As I mentioned, at the Dorchester Collection and at the Plaza in-particular, F&B was always very important, we were the first one to have a three-star MIchelin guide restaurant, we want to offer the best in the city, so for us it’s important. And it’s the window of the hotel, the Spa is the window and the F&B outlets are the window. The rooms, you make the profit with the suites and rooms but the window and the life is through the outlets. I know it’s very controversial right now about F&B profit, we do some profit, but it’s not as large as the hotel and it’s not a big deal, you have to concentrate on what gives you more return on investment which is the rooms. F&B isn’t meant to do the average rate of the rooms so I think it’s not really a problem, you have to be profitable because it doesn’t make any sense if you’re not profitable, but it’s not a big deal if you don’t have the same profit as the rooms. The big picture of an hotel, the positioning of all that, there is a lot of different items and part of it is F&B. So of course it has an impact on the average rate, but it’s not because you have an Alain Ducasse that I will raise my average rate. A hotel is also an ambience, you want to have fun, you want to see people that count in the city, you want to be part of them, so you have to be mixed with the true people from the country, but also the high-scale people for your ego, you want to be part of all that, so of course that helps to raise the average rate. In which way does Dorchester Collection take a proactive approach, or even apply Artificial Intelligence technology as a new metric in anticipating what the customers want and are looking for? I have two answers for that. First we have puzzled alot about technology for the guest, because we have some guests that are geeks and they want everything at the age of the technology, and some others that hate it. We can’t always be at the cutting edge because it changes every every two months we have 208 rooms so it will cost a lot, but also because we have some guests that don’t like it. We have to take decision in-between to show in a way and to give the opportunity for both guests to have what they want to get. For example, we have iPads in our rooms to order room service, but of course you can call. We have electronic lights but they’re quite easy to use, it’s not too much technology. And we really asked ourselves are we going to go further, and we said yes we have to. But we want to do it in a way that will ensure the guests are not too lost. The second part is how the technology will help us, back of house to be more productive front of house and that’s the big transition and transformation. It has been three years that we’ve worked on the program. and that we have developed first. We have 30 different technologies that we work with, PMAs, Google etc. and we look from one to the other separately, it takes us a lot of time, we have developed a network of all these different technologies to be in one. Like an umbrella. It’s taken three years and it’s coming, it is done now, it’s coming at The Plaza at the end of May and will allow us to have what is on the web, what is on our PMS what is internal and outsourced, different technologies in one that will help all employees to have everything about the guest in one picture. So a long, long way to get there but it’s coming and it will help a lot. And this is designed in-house for Dorchester Collection? For Dorchester Collection. How do you see where the industry is going in regards to this short-term stockholder value? First, I think it’s not at all more in the hotel industry than in other Industries. I think the big pressure is mostly on companies on the stock exchange market or with owners that are in finance and want a quick return on investment. In the short term it is terrible for companies. We’re not under this pressure at all, we have an owner who sees us as a long-term investment, so we don’t have the pressure, even though we have a mission at Dorchester Collection which is really a tripod, and the balance between the employees, the guest and the owner. So we want to be profitable. We’re not like some of our competition that don’t care about that and just spend a lot of money. That’s not our case at all, we are very profitable, we are second in the market in terms of profitability. So it’s important, but we don’t have the pressure. The bad pressure. We have the good pressure to be proud of doing what we do, and to have this balance between the three. In the luxury market it’s so important to have investment, otherwise you die, and not to cut what you are saying, because it’s the end of what makes a luxury brand luxurious. And in Paris because of competition I think it’s the other way. People are putting on more and more bottles of champagne, and more and more amenities because of the competition. That’s also another point, sometimes it’s the owner that’s putting you under some pressure, but you have also the market and you have to have the same level as your competition, so it gives you a balance between competition and the owner. Going back over the last 20 years since you’ve been at the helm of The Plaza Athénée, what are some of the biggest challenges you’ve faced in your tenure? I think the downturn after the attacks in 2015 and the downturn in 2009 after the financial crisis. Such a sudden downturn in business is at first very difficult and disruptive, and then very interesting because you ask yourself, what you have to do to get back, to come back. I think all the team learned from it, but for sure it was the most difficult challenge we had, a lot more than the closure and reopening or a marketplace that is more competitive, that’s not too disruptive, but the downturn in business, yes. Now let’s fast forward another 20 years to around 2040, where do you believe the ultra-luxury hospitality industry will be 20 years down the road? What needs to happen today for us to better prepare for that day tomorrow? We have no clue. Because 20 years ago if you would have asked me the question, I would never guess about the pressure of the social media for example, or Chinese travelers coming to Paris, maybe that I would have guessed. I think to be prepared the most important thing, is to adapt yourself and to have the ability to change. Of course you have to be open to understand and hear, but then change goes so quick and it will go even quicker. All the change that you have to be prepared for is to have the team, to be young again and not to stay doing what they always did, and to give them the taste of change. That’s really the companies that will get the most out of change, the ones that will know how to put into the hotel the taste of change, that’s the most important thing I would say, rather than to guess what will come in 20 years. So agility, adaptability and embrace the change. Yes, it’s really helped us all these years at The Plaza, and I think it will be even more of a quality to have in the coming years. Laurence Bloch, on behalf of Glion Institute of Higher Education, thank you for your valuable time and for your great insights. It’s been a pleasure speaking to you. We wish you and the Dorchester Collection, and of course the Plaza Athénée all the best for the future. For you too, for Glion too. Thank you very much. Thank you.

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