Keep pace with changing industry trends and keep your sanity.
by LARRY MOGELONSKY, MBA, P.ENG.
As is the case for many of my fellow baby boomers, it was time for my wife and I to downsize from a rather massive family home to a cozier condominium. Long since achieving empty nester status and with the kids both having gotten a foothold in their respective careers, we needed a new project, and renovating our new apartment seemed like just the ticket.
What started as a mere paint job and the purchasing of new appliances, though, morphed into a $200-per-square-foot money pit comprising LED lighting, flooring, HVAC, ‘smart’ technology, electric mirrors, sound systems, kitchen furnishings and plumbing fixtures. Ultimately, we ended up experiencing a quintessential case of ‘scope creep’ – something that is actually quite common for any property refurbishment. I was just lucky that, despite the increased capital expenditure, all emotional outbursts were kept duly in check.
Hotel renovations are significantly larger in scale but nonetheless follow the same methodology. They are a necessary dread of our industry, and as everyone knows, there will be scope creep and possibly a few tears. Renovations are essential, however, to keep pace with the constantly changing décor trends, star-rating updates and chain-mandated requirements as well as technological advancements that progress from value-adds to guest expectations.
Having gone through a dozen large-scale projects of this kind over the past four decades working in the hospitality industry, I discovered hoteliers can keep up with changing industry trends – and keep their sanity – by following a general guideline of the following 12 tips.
1. Define your objectives.
Be as specific as possible and make sure that these are written and approved by your ownership group. My mistake this time around was that my vision was very different than that of my spouse, which resulted in serious cost overruns and time delays. Similarly, you must be perfectly clear with all the key stakeholders and establish a chain of command so that there aren’t conflicts that arise mid-construction. And one important note, never let your spouse be your interior decorator, even if eminently qualified!
2. Timetables are split in thirds.
Whatever you are proposing, figure one third of your time will be spent planning, another third in the actual execution and the final third in quality control or adjustments. Do not underestimate any one of these segments or you will find yourself in a compromising position. I’ve seen many projects where the quality assurance portion wasn’t given sufficient time. The result was launch dates that were set back by weeks and the retooling of all subsequent public relations plans. These delays can be expensive, as sales and marketing tactics built on this opening schedule cannot easily be altered, nor can launch events. In one instance, a group was booked for a property a few weeks after the projected opening, which inevitably had to be pushed back. The cancellation fees included rebooking the group in another property, paying for transportation and other ancillary expenses.
3. Accurate budgets never last for more than the time they were created.
There are more ways for costs to overrun than you can count. I thought our planning on this condo was generous, but we ended up about 30 percent over budget, and that included several areas of significant cost savings. It’s natural to use a renovation to augment deep cleaning, upholstery renewal, upgraded security systems, LED conversions, soft goods and the implementation of new technologies. It all adds up and you must leave some buffer in the budget for these wildcards.
4. What’s behind the walls?
Our condominium is only 17 years old, so there were no crazy surprises like you would find in a centuries-old building. Nevertheless, we discovered significant shortfalls in wiring, plumbing and HVAC that all needed to be corrected before we could begin the fun stuff. Of course, these resulted in further cost increases and time delays. The lesson here is to thoroughly inspect the state of affairs ‘under the hood’ before finalizing the scope and budget. Sometimes, this is not possible. I recall a project for a property where the plans involved some smashing of walls yet did not account for pipes that had to be removed. This surprise turned into a massive headache to say the least!
5. Hire a great general contractor (GC).
Simply put, you have a hotel to run, not a construction site. Don’t even think of doing both simultaneously. You need someone who will manage the project on your behalf. Our GC became my single point of contact for the project, helping streamline communications and saving me time. He collected all my notes and disseminated them to the multitude of tradesmen onsite. He also fed back issues and presented potential solutions. Lastly, if you think that you can delegate this to a junior member of the team, take heed; this is no place for on-the-job training.
6. Let everyone know your deadline.
In a residential move, this is straightforward; the closing date of your home’s sale dictates the project’s drop-dead completion date. While this gave us six months of overlap, the GC understood the final month was set aside for moving. With no secrets, the work was accomplished in the set timeframe. As a senior manager, you must decide what the maximum tolerable length of agony is that your property can endure before irreparable damage is done to its occupancy or reputation. Typically, this involves a team effort with your sales team and an understanding of peak demand periods and planning for the renovations upwards of a year in advance of the next offseason.
7. You cannot walk away.
To keep everything on track, I visited the jobsite at least twice a week in addition to my weekly GC meeting. Apart from the obvious status reports, there were always new items and unexpected issues. The devil is in the details, and you won’t discover those details unless you are periodically on the ground with the troops. To note one example, we did not specify the location of the thermostat. Without any direction, the HVAC folks placed it in what they thought was the optimal position, but this did not take into consideration the high headboard of our bed, which would have covered it. Good thing I was there to catch this before it was too late.
8. Document all change orders.
We kept a running tally spreadsheet of all changes that we requested. While this did not lead to any real cost savings, at least we understood the detailed reasons for the overages versus budget. This approach will come in very handy when ownership needs to understand your budget predicament or to reconcile excesses.
9. Create a positive work environment.
I’m fussy about coffee. So too were my Italian, Portuguese, Guyanese, Lebanese and Turkish workers. I knew that if I did not provide great coffee, one junior team member would be tasked on a continual Starbucks run. A hundred-dollar Nespresso machine plus lots of capsules turned out to be a wise investment. Undoubtedly your coffee service can be wielded as a similar motivational tool and timesaver. (As additional learning, the decaf capsules we provided were never touched.)
10. What ifs are expensive.
Want to move a door, reposition a switch or add a dimmer? Most GCs will never say no. Just about anything can be built or modified; it is merely a matter of time and materials. So, be careful what you ask for, as your whimsical idea may be converted into reality but at a price too hefty to properly bear. One other key lesson here is that LED bulbs are not compatible with all dimmers. We learned the hard way, having to discard over 200 bulbs. That’s for one condo, so imagine this expense for your property.
11. Take lots of before photos.
Try to get photos of the best angles and where you stood so that you can replicate them exactly with the new look. These before-and-after comparisons may help you explain cost overruns to your owners. They will also be useful for your sales team in getting lapsed customers back into the fold.
12. Say thank you to your team.
I didn’t hire painters, carpenters, electricians, plumbers, drywall installers, floorers or HVAC specialists. I hired craftsmen who take great pride in their work. It’s probably a small job to them, but clearly very important to me. Such professionals will feel similar pride in their work done to refurbish your hotel. No matter what the project is or the size of your property, it costs nothing to say thank you in person or by email, and it will always be appreciated. While I followed up to each first by email, I also held an appreciation party for them later that summer on the terrace so they could all come with their families to see the fruits of their labor. What surprised me the most? My general contractor remarked that in over 30 years of operation, I was the first client who ever invited his entire team to a thank-you party. ■
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