Sparking Hotel Mojo

When lodging industry fundamentals started crashing during spring 2001, nowhere was hit harder than the Bay Area. Pricing Power collapsed, occupancies dropped and ADRs plummeted. Across the country the situation was also getting tenuous, but it was much worse in a market that until then had been suspended by the dot com bubble. When it crashed so did the need for hotel rooms. And just when it seemed like things couldn’t get any worse, the SARS scare and then 9/11 sent an already wobbly northern California market into freefall.

At Joie de Vivre Hospitality, CEO Chip Conley had been investing nearly all his waking hours for about 15 years in his company. He cobbled together the second largest chain of boutique hotels in the country. Unfortunately, the vast majority of those hotels happened to be located in the Bay Area. Suddenly assets became liabilities and Conley was at the precipice. Keeping the company afloat meant making drastic decisions.

But instead of calling it quits he dug down deep. Recalling the work of a psychologist he relished learning about while in college, he entered a period of self actualization. It was a time of discovery at the most basic of levels why he was attracted to the hospitality business. Conley realized that owning and operating hotels was what he was meant to do. It was his true calling. So Conley stopped taking a salary, liquidated holdings and took out multiple mortgages on his own home.

Taking that cue from the aforementioned psychologist Abraham Maslow gave Conley the strength to persevere. But it also got him thinking about other companies that have either consciously or unconsciously utilized self actualization. The result of all that deep thought didn’t just manifest itself with a company that has subsequently grown market share 20 percent and tripled revenue from that low point: It’s resulted in a new book.

Out today at bookstores and with online retailers nationwide, PEAK: How Great Companies Get Their Mojo from Maslow (Jossey-Bass, September 2007, $27.95, Cloth), focuses on Maslow’s iconic Hierarchy of Needs to create a treatise meant to give insight on eliminating workplace dissatisfaction.

The book, he said, illustrates how leading American companies are using Maslow in the workplace — either intentionally (Southwest Airlines, Harley-Davidson, Men’s Wearhouse) or unintentionally (Amazon, Google, Starbucks). He also proves that his new theory can help any business to become a peak performer.

Conley take’s the Hierarchy of Needs and boils them down to thee essential motivations: Survive, Succeed and Transform, and developed a unique hierarchy for each Relationship Truth and provides “peak prescriptions” for what is possible at each level.

“Maslow said people in life that aspire to peak and live to fulfill potential are generally in a self actualized state. When in that state they have peak experience,” says Conley. “And as a business made up of humans, you need to create a sense of teamwork among employees and connect with customers so they all feel inspired by their experience.”

People crave recognition, Conley says. It’s the number one reason they leave jobs (money is fourth). “People generally feel unrecognized and unappreciated,” he says.

So at Joie de Vivre, Conley implemented a plan where all meetings ended with a 10 minute period of recognition. At executive meetings, for example, the head of sales may give plaudits to someone in his department. Then someone from another department such as IT would congratulate that individual. Meetings ended on a positive note and employees began hearing their efforts were being noticed at the upper levels of the company. It’s a method Conley says breaks down corporate silos and creates a united, cohesive organization.

He also says that in order drive peak performance, a job must have meaning. Something that’s elusive for departments such as housecleaning. At Joie de Vivre, Conley says 35 percent of his employees clean toilets. So how do you give meaning to a traditionally unfulfilling task?

Conley said they went through a self actualization process with housekeeping employees and asked deeper questions to uncover how their work affects customers. By conjuring up images of peace of mind, calm and guest comfort, the housekeepers became aware they we part of something more.

“When someone has sense of calling, one hour of work time is spent very differently than someone who sees it as just a job,” says Conley. “People have the ability to transcend the bottom of the pyramid. If those people are reinforced on right behavior that employee might start to move up the pyramid. Recognition makes them realize this is a career.”

Company wide turnover is a low 25 percent compared to industry averages that range from between 70 to more than 100 percent depending on who you ask. Joie de Vivre currently has 40 properties.

In the end, the most important thing Conley wants is for others to feel like he does. Knowing no matter what happens he’ll always have joie de vivre.

Chip Conley will be featured as a keynote speaker at the upcoming BITAC Purchasing & Design West. Heralded by hospitality executives as one of the best events of the year, the event is taking place at the luxurious Hotel del Coronado in San Diego from October 21 -23.