Business Brains

Icon | Mark Hoplamazian, CEO, Hyatt Hotels

Icon | Mark Hoplamazian, CEO, Hyatt Hotels

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By listening to colleagues and guests, the financial whiz has transformed a fragmented hotel network into a hospitality brand renowned for attention to customer service.

Running an international hotel chain was the furthest thing from Mark Hoplamazian's mind when he took on a graveyard shift at a two-star tourist hotel on Edgware Road in London.

The young Harvard undergraduate student just wanted to earn enough spending money to travel Europe after his exchange term at the London School of Economics. But that six-month stint as check-in clerk/sometime security guard/general go-fer proved invaluable 30 years later, when Hoplamazian was tapped virtually out of nowhere by the Pritzker family to run the venerable Hyatt Hotels.

"There were certain people in the hotel that were really bringing a lot of themselves to what they did every day, and there were a couple of people that I interacted with who were punching the clock and basically were there to get by," Hoplamazian, now 49, recalls during an early evening phone call wedged into his schedule on an early July road trip.

"There was a huge difference in my experience with those individuals and also guests' experiences with those individuals," he continues. "So my own personal goal in life was that you've got to be something that you really have some passion for but that also makes you feel like you want to bring a piece of yourself to what you are doing."

Trained as an analyst and numbers guy, the financial whiz channeled that memory when he took over as Hyatt's president and CEO in 2006. Plucked from within the Pritzker Organization, where he had helped manage the family's real estate portfolio and holdings since 1989 and was considered somewhat of an honorary family member, the intention was for Hoplamazian to find a permanent CEO. The Pritzker family sought someone who could negotiate family politics and create a more cohesive identity across the hodgepodge of hotel brands. Six months into the search, Hoplamazian realized he wanted the job. "My primary motivator was the people," he remembers.

Seven years later, the Hyatt hospitality brand encompasses 508 properties across 46 countries worldwide (as of March 2013) that cater to business and luxury travelers. It added 22 hotels during 2012, including the hip luxury property, Andaz Amsterdam Prinsengracht, in the Netherlands; and its first select-service hotels (that's extended stay for the layperson) outside the U.S. market in Costa Rica and India. Over the past decade, Hyatt has opened almost 200 new properties -- an investment of close to $10 billion. There are now seven distinct brands under its umbrella generating $4 billion in annual revenue.

For perspective, that's much smaller than the competition -- Hilton boasts approximately 3,800 properties while Marriott International has around 3,700.

But Hyatt's leadership is focused less on size than on becoming the "preferred brand for our colleagues, guests and owners," as Hoplamazian and Hyatt Chairman Thomas Pritzker write in the company's 2012 annual report. "We believe that our culture and the relationships amongst our colleagues ultimately position the Hyatt brand to represent human care -- and to go beyond service to our guests as a hotel company," they tell shareholders.

The latest illustration of this philosophy is "Ready to Thrive," a new component of the Hyatt Thrive corporate social responsibility program. The idea is to encourage local literacy and career development programs in communities where Hyatt is managing or developing properties. The plan will include the United States but emerging markets are getting the initial attention.

During the first year, the program will focus on Brazil (among other places); a Grand Hyatt is scheduled to open in Rio de Janeiro in 2015. The company has made a $750,000 commitment over the next two years to training. In partnership with the Youth Career Initiative, Hyatt has run similar programs at its hotels in Sao Paulo; Warsaw, Poland; Amman, Jordan; Mumbai, India; and Cancun, Mexico. So far, those hotels have wound up hiring 45 percent of the graduates.

"You get amazing results when you put kids coming out of difficult neighborhoods or family environments and you put them together with people have also may have started in those same places, those neighborhoods," Hoplamazian says. "It gives them an example of what it may look like if you can get yourself plugged into something that provides you a career opportunity."

When he isn't out-of-town visiting one of Hyatt's actual or soon-to-be properties, Hoplamazian and his wife Rachel Kohler (yes, the same Kohler family behind the well-known bath and kitchen company) are fixtures within the Chicago educational community. He's a trustee for the Chicago Latin School (where his children attend classes), a board member for New Schools for Chicago and an adviser to Facing History and Ourselves, an organization dedicated to combating racism, anti-Semitism and prejudice through school curriculum. The latter affiliation is a nod to his Armenian heritage.

"[Education is] sort of the only thing that I spend my time on, other than my family and my work, just because I think it's the core of what's needed to really put this next generation in good standing," he explains. "Especially, in the United States, I think there is a great need for maybe a different mindset with respect to school reform than has existed in the past. So my level of engagement on educational issues is quite high."

More than anything else, Hoplamazian wants the dialogue around reform to be more open-minded, an attitude shaped perhaps during his own K-12 experience at the elite Episcopal Academy in suburban Philadelphia, which professes to educate the whole student. "I think in some ways, school reforms efforts historically have been around fixing a structure that dates back decades, but may not be relevant or as relevant to the future as it needs to be," Hoplamazian muses.

He is likewise open-minded about how properties should be run, trusting "colleagues" and guests to provide direction rather than dictating policies from on high. When he first became CEO, Hoplamazian spent nine months visiting Hyatt properties, asking "ostensibly stupid questions," as he recalled in one interview. One of the first extensions under Hoplamazian's direction was the Andaz boutique brand, born in London and renowned for its hip lobby scene, which skips check-in lines. Arriving guests settle in the lounge, while clerks with iPads handle the minutiae. There's even a whole series of "salon" events associated with the properties, which are cropping up in China, India, the Caribbean, Hawaii, Costa Rica and Mexico.

Right now, boutique hotels are the fastest growing segment of the global hotel industry, which Euromonitor International estimated at $457 billion for 2012. But what's next?

"Our experience around the globe is that consumer tastes change rapidly, and in some cases, I would say in emerging markets in particular," Hoplamazian says. "So if you look at buying behaviors and attitudes in China among consumers there, it's really evolving very, very quickly as those individuals get more exposure to brand and different inputs and stimulus from different markets. So being able to stay alert to that and be responsive to that in real time is really important."

Two years ago, he hired someone from outside the industry to institutionalize that alertness. Hyatt Chief Innovation Officer Jeff Semenchuk had no hotel industry credentials, but he did have plenty of entrepreneurial experience with the likes of Citigroup and Pfizer.

"I recognized that we wanted to have a discipline around better innovation, and doing it faster and more effectively," Hoplamazian explains. "And have it be a discipline that exists within the company but not to create an ivory tour approach to innovation where it happens in some office or in the corporate office somewhere and then is bestowed upon the hotels."

While Hoplamazian prefers face-to-face feedback, he is a strong proponent of social media as a means of gauging guest sentiment. Hyatt was the first to adopt a Twitter concierge service. It also uses another social service, called Branch, to facilitate better communication with its community of guests. "We wanted to actually begin a conversation, in this case, with travelers and understand more about what they are thinking and what we are getting right and wrong along the way. But have it be more of a two-way dialogue," he says.

I can't resist asking him to share his own worst hotel experience. Hoplamzian recalls a long-ago visit to Erfoud, a Moroccan oasis city on the edge of the Sahara Desert that was part of the location shoot for his favorite film, Lawrence of Arabia. The room was like an oven in the daytime heat, an icebox during the desert nighttime chill, and frequented by many unwelcome, multi-legged visitors. "We left a day earlier than [we] were supposed to, just in order to move on," he says, laughing.

Although his family doesn't typically join Hoplamazian on the frequent trips that are now part of his job, together they have logged adventure travel miles on African safari and hiking in Central America, among other places. One of five children, Hoplamazian's own father died of a heart attack when he was just 12. Accordingly, his meeting-packed days in Chicago typically begin early enough so he can end them with his three children whenever possible. The trim executive's daily routine usually includes three to four miles on the treadmill or stair machine, with some yoga mixed in, before he dons his habitual suit and tie for the office. Hoplamazian ran the Chicago Marathon back in 2005, but that was two knee operations ago, and his daily jogs are now "more about the head than the waist line."

On long cross-country or transoceanic flights, he gravitates toward non-fiction or biographies from which he can draw ideas that might benefit Hyatt. At the time of our interview, he's making his way through Conscious Capitalism: Liberating the Heroic Spirit of Business, co-authored by Whole Foods Market co-founder John Mackey and management professor Raj Sisodia.

But when Hoplamazian needs to recalibrate his own priorities, there's one author he recommends above all others, because of the heartfelt passion he put into his life's work: "If I need a dose of great inspiration in terms of prose and in terms of content, I'd say that Martin Luther King is second to none. His ability to express himself and, oftentimes in incredible circumstances, is pretty amazing."

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Heather Clancy

Section Editor

Heather Clancy has written for United Press International, ZDNet, Entrepreneur, Fortune Small Business, the International Herald Tribune and the New York Times. She holds a degree from McGill University. She is based in New Jersey. Follow her on Twitter. Disclosure