47

GM SURVEY

Where’s your head at?

RevPAR, competition and owner relations weigh heavy on the minds of general managers,
according to the Hotelier Middle East GM Survey 2009. Matt Warnock analyses the results
www.hoteliermiddleeast.com Hotelier Middle East • September 2009

Introducing the Hotelier Middle East
GM Survey 2009
L
ast year, the inaugural Hote-
lier Middle East GM Survey
unveiled a wide range of in-
sights from some of the most
important and influential figures in
the industry, as hotel GMs lifted the
lid on the secrets, challenges and ap-
peal of their roles.
Among other things, they divulged
that, on average, 61% of their hotels’
Gross Operating Profit Per Avail-
able Room (GOPAR) originated from
the rooms department, labour issues
were the biggest challenges that they
faced and that guest satisfaction was
overwhelmingly the most important
objective for a GM.
However, we collected those results
in June 2008, way before the delicate,
little seedling of financial concern
sprouted into the all-consuming, econ-
omy-swallowing crisis we face today.
So, just how has the economic down-
turn affected the region’s GMs? How
have their hotels performed? What do
PROPERTY DETAILS (n=83)
0-20 20-75
No. of rooms 0 4
No. of staff 1 4
www.hoteliermiddleeast.com
49
GM SURVEY
they consider the most important fac-
WHAT TYPE OF PROPERTY DID THE GMS MANAGE? (n=83)
tor for success? How many redundan-
cies have they been forced to make and
is Dubai becoming saturated?
For all of these answers and more, Budget: 5%
read on…
THE PARTICIPANTS Hotel
apartment: Resort: 20%
This year, 93 general managers took
part in the Hotelier Middle East GM 4%
Survey, representing hotels in nine
countries across the region. While
the United Arab Emirates accounted
for 54% of the participants, we also
received answers from GMs in Bah-
rain, Qatar, Jordan, Kuwait, Leba-
non, Oman, Saudi Arabia and Egypt.
Looking at geographical location
more specifically, it comes as little sur-
prise to learn that Dubai dominated, City hotel: 54%
claiming 37% of our GM respondents.
Doha and Abu Dhabi both followed at
some distance with only 9% of partici-
pants, while Muscat could muster just
5% of respondents.
In terms of the types of properties
that our GMs controlled, 65% claimed
to manage city hotels, 24% had the
reigns at resort properties, 6% were Amazingly, around 90% of the than half of the GMs have properties
bosses of budget hotels and 5% man- GMs manage four (31%) or five-star of between 100 and 300 rooms, while
aged hotel apartments. Those figures (60%) properties with just 14% of just over a fifth (21%) of respondents
were fairly representative across the Dubai respondents taking charge of employ between 200 and 300 mem-
board, with the obvious exception two or three-star properties. More bers of staff.
of Egypt, where 75% of our GMs ran
resort properties.
JUST THREE GMS — FROM FOUR-
STAR CITY HOTELS IN RIYADH,
ABU DHABI AND BEIRUT — SAW
REVPAR INCREASES THIS YEAR
75-100 100-200 200-300 300-400 400-500 500-750 750-1000 1000-1500 1500-2000
4 19 27 14 7 5 0 3 0
9 14 17 14 10 8 2 3 1
Hotelier Middle East • September 2009
50
GM SURVEY

THE GM MAKE-UP
But enough about the properties,
let’s find out more about the GMs
themselves: their backgrounds, their
experience and the routes that they
took to the top.
When questioned on their coun-
try of birth, it became clear that, in
spite of nationalisation programmes
aimed at encouraging locals into
hospitality jobs, Europe still domi-
nated at GM level. As many as 12%
were born in the UK, 10% hailed
from France and the Netherlands
accounted for 9%. The GMs origi-
nated from Switzerland, Pakistan,
Morocco, Italy and even India but,
disappointingly, GCC countries pro-
vided just two of our 93 respondents.
Looking at the wider Middle
East, the story was not much better,
although Lebanon did chip in with
7% of respondents.
All the respondents spoke
English and, incredibly, more
than half could also ‘parler
en Français’, with Arabic the
third most popular language
among GMs, spoken by almost one
in three of the participants. Up to
44%
of GMs said they would not want
to work for Accor
31% and 24% could speak German
and Spanish respectively, while just
a smattering of the region’s smartest
general managers were able to wel-
come guests to their hotels in Rus-
sian, Japanese, Hindi or Portuguese.
Unsurprisingly, but disappoint-
ingly nonetheless, was the fact that
only 7% of our GMs were women.
The female GMs that did respond
also had to work harder to reach the
top of the pile; they were, on average,
ALMOST HALF OF THE GMS SAID THEIR
HOTEL’S OWN WEBSITE BROUGHT IN
LESS THAN 10% OF TOTAL SALES
41 years old when they first rose to the
GM position, whereas our male gen-
eral managers averaged a touch over
36 years old when they first became
the big cheese.
THE LONG AND WINDING ROAD
What did not alter greatly was the
route that our GMs took to get where
they are today and one message was
loud and clear: hospitality remains
one of the few industries in which
hard work can see you rise quickly
through the ranks.
Just under half the GMs we spoke
to (46%) had completed a high school
degree, very slightly fewer (41%) had
gone on to complete a diploma and
34% of them had emerged from uni-
versity with undergraduate degrees.
One third had completed a manage-
ment-training programme. Yet,
regardless of education, the major-
ity of our GMs started at the bottom,
with a whopping 60% claiming that
their first jobs in the industry were
working as waiters, room clerks,
busboys or kitchen porters.
The journey from entry level to
head honcho had, on average, taken
17.2 years although, predictably, the
region’s female GMs had to put in a
longer stint, with them averaging
19.3 years between joining the indus-
try and working their way up to GM.
That journey, of course, took in
many different roles and depart-
ments but by far the most common
– perhaps a nod to its importance as
a major profit centre within the hotel
business – was the F&B department,
where almost 70% had spent time
working before getting the top job.
To put this in context, fewer than
40% had worked in both room reser-
vations and reception, around 30%
had experience in the sales & market-
ing department and equal numbers
– a shade more than 11% – worked
in housekeeping or finance, while
less than 10% of the Middle East’s
general managers had hands-on
know-how of their security, HR or
recreation and leisure departments.

WHICH HOTEL COMPANIES WOULD YOU NOT WORK AT? (n=34)

Accor 44.1%
Bavaria Hotels 41.2%
Golden Tulip 41.2%
Rotana Hotels 41.2%
Coral International 38.2%
Tamani Hotels 32.4%
Iberotel 32.4%
Hilton Hotels 29.4%
JAL Hotels 23.5%
Swiss-Belhotel International 23.5%
InterContinental Hotels Group 23.5%
The Rezidor Hotel Group 20%
Jumeirah Group 17.6%
Movenpick Hotels and Resorts 17.6%
Dusit Hotels 14.7%
Marriott 14.7% A LOYAL CROP
Starwood 11.8% When hard work is rewarded with promotion through
Kerzner 11.8% the ranks, it seems that hoteliers are a faithful bunch
Kempinski Hotels 8.8% with the average regional GM having been with their
Ritz-Carlton 8.8% current company for almost 12 years; although more
than a quarter had remained loyal to their current
Shangri-La 8.8%
employers for more than 20 years.
Hyatt 5.9%
Unfortunately, Accor is unlikely to see such devo-
Fairmont Hotels and Resorts 5.9% tion from its employees. Although only 10% of our
Banyan Tree 2.9% GMs had ever been employed by Accor, 44% said
Six Senses 0% that, based on experience or reputation, they would
Four Seasons 0% never work for the French hotel group.

September 2009 • Hotelier Middle East www.hoteliermiddleeast.com

 51

GM SURVEY
69.8%
WHICH DEPARTMENTS DID YOU
WORK IN BEFORE BECOMING A
GENERAL MANAGER? (n=63)

38.1% 38.1%

30.2%

11.1% 11.1%
7.9%
1.6% 1.6%
Food and beverage

Housekeeping

Sales and marketing

Security

Human Resources

Rooms

Financial control

Recreation (including spa)

Front office

MORE THAN A QUARTER OF

GMS HAD REMAINED LOYAL
TO THEIR CURRENT EMPLOYER
FOR MORE THAN 20 YEARS
Golden Tulip, Rotana, Coral the largest proportion of our GMs
and Bavaria were almost just as (41%, 36% and 29% respectively),
unpopular; hovering around the while the staff at Six Senses Resorts
40% disapproval mark, in spite of and Four Seasons Hotels & Resorts
only seven of our GMs ever having must sing the praises of their
worked for any of these chains. employers constantly, as not a single
Unsurprisingly, Starwood, Inter- GM said that they would refuse to
Continental and Hilton had, either work for either of these companies
currently or in the past, employed based on experience or reputation.

www.hoteliermiddleeast.com Hotelier Middle East • September 2009

52
GM SURVEY
A VERY BAD YEAR
Of course, no examination of the
industry would be complete without
looking at the effects of the global
economic downturn. And who bet-
ter to explain the fallout from the
hospitality industry than the hotels’
general managers?
Beginning on a positive note, an
impressive (or dishonest!) 67% of
the GMs who responded claimed
that they had not made any redun-
dancies in the past 12 months due to
the economic downturn, although
several said that they had ceased
PREFERRED PERFORMANCE INDICATORS (n=66)
Occupancy
Average room rate
RevPAR (Revenue per available room)
GopPAR (Gross operating profit per available room)
MPI (Market Penetration Index)
ARI (Average Rate Index)
RGI (Revenue Generated Index)
At the top end of the spectrum,
revPAR has slumped by $50 to $175-
$200; but it’s the next rung of proper-
ties down that have suffered most,
with an average of a $50-$75 decrease.
One five-star Dubai city hotel man-
aged the perfect balancing act, by
dropping rates but increasing occu-
pancy to keep its revPAR steady, but
many more failed as tumbling rates
and occupancy saw Dubai hotels
worst hit – many revPARs have been
cut in half. KSA has also been severely
affected; one Mecca-based GM saw
rates tumble by $75 and occupancy
dip from 65% to 40%, resulting in
revPAR falling from $75 to $50.
Overall, Oman and Qatar GMs
saw slight revPAR reductions, while
September 2009 • Hotelier Middle East
hiring. One Kuwaiti GM admitted
to having to cut 25% of the proper-
ty’s staff while a Saudi-based hote-
lier simply answered that he had
needed to make “too many”.
Yet, when asked the single big-
gest way in which the economic
downturn had impacted their
hotels, not one GM named redun-
dancies. One GM claimed that it
had led to contractual issues with
the property’s owner; almost 10%
said that having to cancel refur-
bishments was the biggest impact
from the downturn.
3%
4.5%
25.8%
10.6%
1.5%
19.7%
Egypt’s resort hotels have held steady
due to maintaining low room rates
and high occupancy. Just three gen-
eral managers – from four-star city
hotels in Riyadh, Abu Dhabi and Bei-
rut – saw revPAR increase.
SHOW ME THE MONEY
Last year, GMs reported that, on
average, 61% of their gross operating
profits came from the room depart-
ment and that figure is actually up
this year to 67%; the profit generated
by F&B outlets is also up 2% to 21%.
But F&B banqueting has seen a
fall – down from 11% last year to 10%
this year – as have spas and recreation
which, as a department, slumped
from 5% to 3%.
HOW HAS THE ECONOMIC DOWNTURN MOST
IMPACTED YOUR PROPERTY? (n=61)
Redundancies 0.0%
Reduced revPAR 60.7%
Lower occupancy 29.5%
Cancelled refurbishments 8.2%
Contractual issues with owners 1.6%
Threat of closure 0.0%
Predictably, room-related figures were the
most telling. As many as 30% of GMs said that
tumbling occupancy levels were having the
biggest bearing but, way ahead, voted for by
60.7% of our GMs, was reduced revPAR.
And well they should worry. We asked GMs
how their properties performed in 2008 and the
modal averages were a room rate of between
US $225 and $250, occupancy of 75% to 85%
34.8% and a revPAR of between $175 and $200.
When we asked the same question for the
first half of 2009, the answers revealed an
industry under pressure. The modal aver-
age room rate has fallen $100 to between $125
and $150, while occupancy too has taken a hit,
dropping 10%.
However, as it’s the figure that GMs place
most stock in – 35% of GMs named revPAR
the best performance indicator, above gross
operating profit per available room (26%),
revenue generated index (20%) and market
penetration index (11%) – it is revPAR that we
should pay most attention to.
67% WHAT PERCENTAGE OF YOUR HOTEL’S
GROSS OPERATING PROFIT COMES FROM
THE FOLLOWING DEPARTMENTS?
( AVERAGE RESPONSES)
22%
10%
3% 5%
Rooms F&B department F&B department Spa and recreation Other
department — banqueting — outlets department departments
www.hoteliermiddleeast.com
54
GM SURVEY
However, there was wide variation
in these results. One five-star Dubai
city hotel was in the enviable situation
of garnering 50% of its gross opera-
tional profits through rooms, 15%
each through banqueting and outlets,
10% through its spa and 10% through
other sources. Although this example
was unique, four other five-star hotels
in Dubai garnered around 50% GOP
through rooms with almost all of the
other 50% coming via F&B outlets.
One five-star resort hotel in Fujai-
rah also acquired in excess of 40%
GOP through bars and restaurants,
however, the story was very different
in other cities. Around half of the four
and five-star properties located in
Abu Dhabi, Oman and Lebanon still
relied on rooms to generate between
WORKING OFF-LINE
If the GOP split and business split
results were conflicting, then GMs
opinions of e-distribution channels
were anything but. Almost half our
general managers (44%) deemed
that the hotel’s own website brought
in less than 10% of total sales; more
TOP THREE FACTORS CONTRIBUTING TO A HOTEL’S SUCCESS
GM SURVEY 2009 RESULTS
Location 61.9%
Value for money 60.3%
0 20
Management brand name 47.6%
THE MAIN ISSUES AFFECTING HOTEL PERFORMANCE (n=67)
What do you see as the biggest issues affecting your hotel’s performance (please select three)?
Labour shortages
Increased competition
Political instability
Lack of suppliers
Lack of flights/travel options
Government controls — licensing
Government controls — guest visas
Lack of support from government
Rising inflation rates
Rising cost of living
Owner issues
Construction issues
Current economic downturn
20099 • Hotelier Middle East
September 200
WHAT IS YOUR HOTEL’S BUSINESS MIX ? hotels’ average business. No matter
the location, budget hotels registered
(ie. 20% individual business, 5% group business, 40% around 85% of their trade through
individual leisure, and 35% group leisure, 0% MICE) individual business users with hotel
apartments placing that figure higher
still; in fact, one four-star Kuwait
hotel apartments appealed to no other
demographic whatsoever.
Interestingly, a Dubai four-star city
hotel attracted the most MICE busi-
ness (35%) while the second largest
meeting and events draw (25%) was a
Business Business Leisure Leisure MICE five-star resort hotel located in Fujai-
(individual) (group) (individual) (group) rah, United Arab Emirates, which
also attracted 40% of its business
70% and 80% of their total gross oper- cating all-inclusive properties – and through individual leisure.
ating profit. this pattern, of course, continued On average, however, GMs
A couple of Egypt’s resort hotels when it came to each hotel’s business claimed that Middle East hotels’ split
reported an intake of less than 10% mix, with group leisure accounting was 53% business (individual and
for F&B outlets – presumably indi- for around 85% of Egyptian resort group), 42% leisure and 5% MICE.
than 40% claimed that GDS (global VIEWS ON E-DISTRIBUTION (n=54)
distribution systems) also accounted Percentage of bookings from 0-10 10-20 20-30 30-40 40-50 50-55 55-60 60 and
for less than 10% of the property’s e-distribution channels above
total business; and a shockingly- Own website 24 11 6 7 2 1 1 1
high 47% of GMs saw less than 10% GDS 21 12 8 4 3 1 1 2
of their total business come through
Third-party websites 23 12 6 2 1 0 0 4
third-party websites.
ONWARDS AND UPWARDS
Wallowing in self pity is, of course, not
a hotel’s success, personalised ser-
vice (65%), location (60%) and brand
GM SURVEY 2008 RESULTS how the region’s GMs got to where name (52%) appeared top. This year,
they are today and the overriding sen- location was deemed most important
Personalised service 65% timent coming from the GM Survey (62%) with personalised service fall-
2009 was one of optimism and deter- ing to third place (52%). Tellingly,
Location 60% mination for the future. value for money was second on 60%,
40 60 80
It is a future that is changing. Last 100up from 46% last year. F&B outlets,
Management brand name 52% year, when asked to name the three leisure and spa facilities all saw mas-
main factors that contributed towards sive drops in perceived significance.
Although the economic downturn
being named by 84% of all respon-
dents as the biggest issue affecting
hotels’ upcoming performances is
14.9% hardly a bolt from the blue, it’s inter-
55.2% esting that 55% of GMs also selected
7.5% increased competition (see left).
4.5%
60.7%
16.4%
17.9%
16.4%
9.0%
6.0%
20.9%
14.9%
13.4% of GMs said the major effect of the
83.6% economic crisis was reduced revPAR
www.hoteliermiddleeast.com
56
GM SURVEY
“My biggest challenge will be com-
petition with new hotels”, said one
Kuwait-based GM, while the GM at
a Muscat property feared “more new
hotels and no increase in demand”.
“Maintaining occupancy levels
in a stagnant environment, but with
added inventory in town” was even a
worry for a GM in Abu Dhabi, where
hotels had generally withstood the
HALF OF THE PROPERTIES
IN ABU DHABI, OMAN
AND LEBANON STILL
RELIED ON ROOMS TO
GENERATE BETWEEN 70%
AND 80% OF THEIR GOP
OCCUPANCIES
DOWN IN 2009
During 2008, 50% of our GMs
said they recorded average
occupancy of 75% or more.
When asked the same question
for the first half of 2009, only
32% of the GMs said they
achieved average occupancy of
75% and above.
A DAY IN THE LIFE
When it comes to a GM’s priorities,
it’s great news if you’re a customer
and bad news if you’re a supplier.
Almost seven out of 10 GMs said
that guest satisfaction was the most
important aspiration for a general
manager, with two out of 10 claiming
that employee satisfaction was what
urged them on.
A massive 76% named supplier sat-
isfaction as the least important factor,
while appeasing the corporate head
office was the last thing on the agenda
for 22% of respondents.
September 2009 • Hotelier Middle East
downturn well so far. Given that the
majority of our GMs work in Dubai
IS DUBAI REACHING SATURATION POINT?
and that the overriding worry was
one of less demand and more com-
petition, it follows that they would
consider Dubai’s hotel sector over-
developed and they certainly did
not disappoint, with 83% of general NO
managers saying that Dubai had 17.2%
become saturated.
So, where then did our GMs think
would be the next destination to expe-
rience a tourism boom? A giant 41%
of them said Abu Dhabi – although
the UAE-centric focus of our GMs
should be taken into account here.
Saudi destinations picked up 16% of
the vote (“subject to visa relaxation,”
clarified one GM) while Beirut was
also a popular choice for 12% of GMs.
Doha, Muscat and Damascus all also
had a little support.
There were more positive vibes
too when we asked the GMs where
the biggest opportunities for the next
12 months lay. Many agreed with the
GM of a Muscat five-star city hotel,
who cited “the potential turnaround
TYPICAL DAY FOR A GM (n=63)
Administration
30%
10%
Meeting guests
10%
Internal meetings
30%
20% Owner relations
Dealing with suppliers
YES
82.8%
of the economic situation”, while oth-
ers saw difficult times as an opportu-
nity to pick up market share from fail-
ing or closing properties.
“New transport systems bringing
an increase in tourism”, “the expansion
of flight routes to airports”, and “the
development of transport encourag-
ing more regional travel” were offered
as causes for enthusiasm from three
Saudi, Dubai and Beirut GMs.
Another Dubai-based GM at a
four-star city hotel said “the renova-
tion of our hotel will help us to give
an improved quality of product to
guests”, and many agreed that tough
times represented an opportunity to
increase standards.
Those figures are clearly reflected
in the way that our GMs claimed to
spend their average day. Dealing with
those poor, unappreciated suppliers
took up less than 10% of their time,
as did owner relations. Internal meet-
ings with colleagues, we learnt, made
up 10% to 20% of a standard day.
Each taking up between 20% and
30% of their time, the biggest parts of
a GM’s day, were meeting guests and
performing administrative tasks. As
you may be able to guess, however,
one of these tasks was more popular
than the other.
www.hoteliermiddleeast.com

VALUE FOR MONEY MOVED UP THE
RANKINGS TO BE CONSIDERED
THE SECOND MOST IMPORTANT
FACTOR CONTRIBUTING TO A
HOTEL’S SUCCESS
More than 20% named admin-
istrative chores as the facet of their
role, which they liked least of all, fol-
lowed by the 14% who named long,
unsociable hours as their greatest
bugbear. Just under 10% found
dealing with owners to be particu-
larly tiresome.
WHO SAID THAT?
www.hoteliermiddleeast.com
We’ve placed a question mark
next to the Lebanon-based GM who
stated “the fact that it’s full-time”
was the worst thing about their job
and we think one Dubai-based gen-
eral manager may have picked the
wrong profession. What did they
dislike most of all? “Guests”.
When asked what they most disliked
about their job, which Dubai-based
GM responded “guests”?
THE GM JOY
Incredibly, almost 15% of our gen-
eral managers couldn’t think of a
single thing that they disliked about
running a hotel, and when asked
what they enjoyed most, the enthu-
siastic GM of one Doha hotel said
“every single minute”.
But what else did our GMs enjoy
about their job?
Well, clearly the role of general
manager is all about being a people
person, as 46% said that interaction
with staff and customers was the
most pleasing aspect of their posi-
tion, while 19% named the chal-
lenges they faced each day as their
reason for getting up in the morning.
57
GM SURVEY
67% of GMs claim they have not
made redundancies this year
It’s clear that the Middle East’s
general managers also relished the
‘Jack of all trades’ hat that GMs
need to wear, with 22% explain-
ing that the diversity and capacity
to change minute-by-minute was
what they most enjoyed about being
a general manager.
As the GM of one five-star Dubai
city hotel put it: “I love the variety
and the scope of the challenges. Plus,
of course, beating the competition!”
From what we learnt conducting
the Hotelier Middle East GM Sur-
vey 2009, that could just about be
the GM mantra; although it’s one
that’s going to be put to the test over
the course of the year ahead. HME
Hotelier Middle East • September 2009