Out of the Box

Any Business Should be Run Like a Hotel

By Menachem Lubinsky on August 24 2007

It must have been in the late ‘80’s that I listened to a series of tapes of lectures of leading marketers at a seminar that revolved around the theme of “The Best Way to Run Your Business” (or something in that order). I recall that one of the marketers used none other than Leona Helmsley as his model. What made me remember this particular tape was the death of Mrs. Helmsley last week at the age of 87. “How could it be,” I wondered, “that someone who was dubbed the ‘Queen of Mean’ should in fact have been used as a role model for running a business?”

The obituaries, of course, included the fact that Ms. Helmsley, who presided over an empire of hotels and real estate holdings she inherited from husband Harry, was convicted in the late ‘80’s of tax evasion. But the marketing media gave her credit for her marketing genius in having effectively communicated her sincere concern for guests, at the same time that employees recounted horror stories of her treatment of those who worked for her. But if this conjures thoughts of a Jekyll and Hyde personality, the marketers do not see it that way. A closer analysis is worthwhile for the lessons it may offer anyone who operates a business.

Before Mrs. Helmsley was referred to as the ‘Queen of Mean,” she was dubbed the “Queen.” Her ads showed her standing in front of a line hotel staff and pointing to the quality and luxury the Helmsley Hotels offered. She managed to convince guests that her toughness or which was later described as her mean streak were meant for only one purpose: to deliver a superior service to her guests. The New York Times in 1990 reported that the campaign contributed to a 63% rise in hotel occupancy in the space of four months.

The kind of care that Mrs. Helmsley projected back then is now standard for the hotel industry. Projecting luxury is no longer considered a deviation from the norm; it is the norm. The amenities that hotels offer nowadays were still a few decades off when Helmsley already touted her special caring for her guests. In the luxury hotel of today, quilts have replaced blankets and a full line of upscale toiletries have supplanted the small bar of soap. Slippers and bathrobes are now an accepted standard.

So how does one reconcile the thought of a mean woman bossing around her employees but at the same time receiving credit for being a standard bearer for an entire industry? Employees who have worked for her testify that she could be in the midst of a tirade that the lobby was not cleaned properly, which would abruptly change to a broad smile as soon as she set eyes on a guest. She wanted her staff to know that her business depended on the satisfaction of her guests and that she would not tolerate mediocrity when it came to satisfying those guests.

It is probably true that today Leona Helmsley would fail most tests as a boss. Society simply does not tolerate a “mean boss” much less a woman who is dubbed the “Queen of Mean.” But the marketer who held her up as a standard bearer felt that her compulsive belief that the customer’s satisfaction was the key to her brand’s success was so overpowering, from a marketing point of view, that he dismissed all of her other failings. Simply put, he seemed to say, so long as she was mean not simply to be mean but to extract the maximum for her guests, her business model could not be faulted. In fact, it should receive the accolades of the marketing community.

It is probably true that other icons like Donald Trump followed her model. He, like Helmsley, learned that the customer is tolerant of a mean boss who ultimately looks out for their interest. The proof is that both their brands rose to the top of the hospitality charts.

I hope that the reader of this column does not by now get the impression that I am either advocating meanness or in fact am tolerant of abusing underlings. What is important is to appreciate that as much as nice mild mannered behavior is desirable, pursuing the goal of excellence when it comes to the customer is the operative goal.

Airlines give the impression that they care about the customer. They have systems in place for complaints, lost luggage, and housing in case of a delay. Yet, consumer surveys show that the flying public is not necessarily convinced. In the case of Leona Helmsley there was no ambiguity about her position on the total satisfaction of her guests. People flocked to her hotel because they felt that in Helmsley’s “palaces” they were first. Even while the trial was going on for her tax evasion, she appeared in the hotel ads and occupancy at her hotels continued to soar.

It is ashamed that the late Mrs. Helmsley did not or could not realize that she could achieve her goals even while being nice to workers. Today, good bosses use incentives, proper training, motivation, and other positive behavior reinforcement to score with employees while pursuing perfection for customers. Management experts say that workers are more than willing to buy into the ideals of the customer being first, but only if they are clear about the goals and also that they are made to feel like shareholders. That is why many large chains refer to their workers as "associates."

The lessons she taught businesses are clear: Taking good care of your customers is the key to a successful brand. Striving to make the customer feels special is not a luxury: it is a necessary ingredient. Achieving these goals are the overriding imperatives to a successful business, even more than good character. In the end, the well taken care of customer will judge you to have had the best character.

Out of the Box is a collection of strategic marketing articles that Lubicom has published on various topics, trends and ideas in the marketing world. The articles have been published in the Hamodia weekly newspaper circulated on three continents to a readership of well over 100,000.

The name, "Out of the Box" is a term used frequently in business nowadays to describe creative thinking that is not the norm. It is meant to help a business pull away from the pack or separate oneself from the competition. It is to some extent fraught with risk, simply because it is not the run of the mill thinking, but it is at the same time the key to reaching the next opportunity.