"Money men" and "war for talent" worry Angelini.
By Yeoh Siew Hoon ~ SHY Ventures
Monday, 22nd May 2006
Giovanni Angelini - Asia Pacific Hotelier of the Year - speaks to Yeoh Siew Hoon about his concerns for the industry and shares the Shangri-La story.

What concerns this year's Jones Lang LaSalle Hotels' Asia/Pacific Hotelier of the Year most is that too many big hotel groups are now being driven by financiers "without concern for customers and quality".

Giovanni Angelini, chief executive officer of Shangri-La Hotels and Resorts picture right,  who accepted the award on Thursday (May 18) at the 9th Asia Pacific Hotel Investment Conference in Singapore, said, "Look at the big deals being done today and look at their heads. They are not hoteliers and they may not have concern for customers."

The upside is that it puts companies like Shangri-La in a good position. "We are a small group which puts customers first and that gives us an advantage. Of course, all hotel groups say they put their customers first and when they are run by financiers, you know it's going to be different."

The other concern he has is the "war for talent". 

"Our industry is going through an unprecedented boom in development and we are going to need people to work in all these hotels being built. We are putting a lot of investment in people.

"We invested US$10 million in the Shangri-La Academy in Beijing and we are doing continuous training – it's non-stop."

Shangri-La's vision is to become the number one employer of choice in five years, he said.

How will it do this? "By holding on to our good culture, by giving people a chance to grow with us and achieve their aspirations, by giving opportunities to local people to transfer to other countries and of course, compensation and benefits are important.

"When it comes to bonus time, you have to be generous. You have to share the success with your team."

In giving Angelini the award, Jones Lang LaSalle Hotels cited his "achievements in and dedication to the Asia/Pacific industry and a steadfast commitment to excellence". It also cited him for steering Shangri-La through a period of aggressive growth with the aim of doubling the size of the company in five years.

At present, the group has 47 hotels with over 23,000 rooms. There are 41 under development.

Angelini, who called the award "a result of the solid work that we've done together", said the turning point was in 2002 when the company found itself with 40 hotels in Asia and asked "what next?"

"The decision was taken to go outside Asia and also go for management contracts. We knew it wouldn't be easy. In the early days, we had people asking, who are you and what can you do for us?"

The first management contract it signed was in Dubai, followed by Sydney. "The negotiations were difficult. The owners didn't have a lot of confidence in us and we had to make some concessions in our terms with the first two hotels."

Winning those two contracts against stiff competition proved to be the second turning point in its growth. "After that, it became easier," said Angelini.

Today, Shangri-La Sydney and Dubai are among the company's top performers in RevPAR. 

"We gave it all we got, all eyes were on us and we couldn't afford to fail. Now we have more opportunities than we can handle. We can be more selective about where we're going to be."

He said Asia would always remain Shangri-La's bread and butter and that its expansion to North America, Europe and the Middle East would be small-scale compared to other companies'.

"We are not looking at 50 hotels in North America or Europe, perhaps eight or nine in North America. In Europe, we have two now and maybe we will go for three more."

Currently, a third of its hotels are under management contract and Angelini does not see that ratio changing as the company continues its growth.

Angelini also said there was no plan to roll out a third brand. "Shangri-La is our priority and Traders is secondary. We were looking for a two-star or economy brand in China but we haven't found the right business formula yet."

And while other hotel companies are touting their loyalty points programmes, Shangri-La will stick to its recognition programme, Golden Circle. "It drives 30 percent of our business and in some cities, up to 50 percent. We prefer that a customer comes to us for service and not for points," said Angelini.

While observers have wondered if the quest for size could lead to a compromise in the Shangri-La quality, Angelini said the company was mindful of that and had beefed up resources to support the growth. Its head count in its Hong Kong headquarters has gone from 230 in 2002 to 400 currently. It is in the process of creating a division in North America as well as in Europe and Middle East.

"We believe we are up to the challenge. We are comfortable with the rate of growth. We have a good, stable team."

The SHY Report
A regular column on news, trends and issues in the hospitality industry by one of Asia's most respected travel editors and commentators, Yeoh Siew Hoon.

Siew Hoon, who has covered the tourism industry in Asia/Pacific for the past 20 years, runs SHY Ventures Pte Ltd. Her company's mission is "Content, Communication, Connection".

She is a writer, speaker, facilitator, trainer and events producer. She is also an author, having published "Around Asia In 1 Hr: Tales of Condoms, Chillies & Curries". Her motto is ‘free to do, and be'.

Contacts: Tel: 65-63424934, Mobile: 65-96801460

Check out Siew Hoon's new website, www.shy-connection.com, which features a newly-launched e-zine with a difference.

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