It's the time of the year when budgets for 2011 are being prepared, reviewed and approved around the world in hotels and hotel companies.

I wonder how much executive and management time could be saved if businesses took a cold hard look at what they are all about.  I often see businesses being ‘led' by leaders who have lost sight of the essence of their business. This gives rise to a waste of valuable time and energy throughout the company, not to mention the loss in actual value which results from resources being applied with a lack of focus.

Sustainable, superior returns accrue to hotels and hotel companies that focus on what they do best. The evidence is that simple and yet it's incredibly hard to internalise and stick to. It is the rare hotel  that uses the "what we do better than anyone else in town" mantra in making every operating decision across every operating department. And even these companies will only really capitalise if they also align differentiating internal capabilities with the right external market position. Such companies are called ‘coherent'.

As consultants, we are often asked to assess or comment on a hotel's relative market share (RGI). However valid such analysis is, it seems to me that it is looking at the problem from the wrong angle. If hotel managers and leaders focus on what that hotel or hotel company does well - indeed what it does better than anyone else - and continually makes it better; if they then work hard to find market segments (which may be as small as one person) and if, after all that, they promote, price and position these differentiators, success is almost certain to come.

And not just success for one month or one year, but for the long term. And because those hotels/ hotel companies are doing what they naturally do best, that success is not only sustained, it's sustainable.

In such a world, what would the budget process look like? Well for a start, it would involve the executive team identifying those four or five things that the hotel does really well (better than anyone else) and then allocating substantial resource to do it even better. This might involve improving the processes, improving the underpinning technologies, or training and developing the hotel team. It might require moving resource from non-core areas to core ones. Indeed there may even be a need to bring in new people, new technologies, or new processes. That would be one side of the budget process.

The other side would concern marketing. To put time and effort into the identification of markets – which may be many people, several intermediaries, or even individuals. It would be important to design relevant marketing tools to promote the hotel's sustainable areas of excellence to a buying community.

So the budget review process would be two- fold:

(a) An examination of whether the hotel is clear about where it intends to be different from the market competition, which capabilities will deliver these differences and how the hotel will leverage those differences.

(b) Validation that the hotel is investing in the capabilities that really matter to making those differences and that it is doing so in a highly focused way that ensures all processes and technologies support the effort. Any performance management system should reinforce this focus.

Coherence around the essential capabilities not only shapes the leadership agenda; it enables leadership to happen everywhere, because it aligns the organization at every level to vision and mission, giving employees the tools to make the right decisions every day.

The Hotel Solutions Partnership team of hotel consultants knows just how important it is to fully understand the challenges facing our clients. The Hotel Solutions Partnership offers specialist hotel consultancy services to hotel owners, operators, developers and investors, or those wishing to become involved in the hotel and hospitality industry.

It also aims to provide hotel consultancy with a very low carbon footprint. Our business model minimises the impact on the environment and, in respect of the travel necessary for an assignment, we buy an appropriate level of carbon offsets. Intelligent thinking, effective teaming and applied expertise form the foundation of the way we work with our clients, and the solutions we offer are tailored to meet the individual and special requirements of your hotel or hospitality business.

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