3 minute read
August, 7 2023
Book Excerpt from The Prosperous Hotelier – What is ‘Hospitality Financial Leadership?’
A few years ago, finding the three words “hospitality financial leadership” together in one sentence was not possible. I know because I tried to Google them in 2014 and came up with a grab-bag of ideas on leadership, consulting, courses and more. Even the words “financial leadership” revealed surprisingly little – some tidbits about CEOs and their roles, but nothing any broader.
Yet, in my opinion, financial leadership is the cornerstone of any manager, executive or leader’s business acumen. It enables an individual to see the importance of being plugged into the strategy of the business, regardless of their given vocation or the industry they are in.
They could be a human resources manager, a facilities manager, a chef or the head of an information technology division – but when they are financially tuned into the business at hand, they see the big picture. They know the role they play in delivering results and they can use their financial leadership skills to communicate with and lead their teams. They make the numbers in their world just as important as the other disciplines – like colleague engagement, service and operations.
Financial leadership skills enable these managers to create a level of understanding and sophistication around business strategy. They can relate this understanding to the mission and vision of the team they are leading, all the way down to the contributions of individual team members. They see the numbers as a form of currency that provides fuel to ignite and mold the talent and collective efforts of their team.
The executive with financial leadership skills knows that the key ingredient each member of his or her squad needs to propel their individual careers is a sound grasp of the company and industry business strategy. Leaders enable financial leadership knowledge within their groups and, as a result, they produce other leaders who help propel the company’s growth. Without these skills being brought out of the individuals by the functional leader, the contributions each person and the collective team can make are restricted.
In short, great leaders are developed, and they need exposure to the financials to grow.
Hospitality Financial Leadership is the missing link for many hotel leaders and executives. It is hard to believe that some of our senior members are playing the game with a shorthand. If you have been in hospitality for some time, you know exactly what I am talking about. We promote people from Operations, Sales and other areas into the role of General Manager. It has been this way since the dawn of time. So, it is quite frightening to think that the hotel’s most senior person, the one sitting in the pilot’s seat, doesn’t possess proper flying skills. In many cases they are just winging it. If the hotel owner knew just how green they were, he or she would slip a disc.
But you do not need to worry too much about the captain not knowing how to fly if they are open to learning financial leadership skills. This is where they can earn their wings.
Having the ability to manage people, the owner and the brand is key—but knowing how to make the numbers work is the nitro you must have if you are going to get off the ground and stay in the air.
What is the secret that will all but guarantee success?
Making the commitment to have the numbers be just another, equal part of what you do. This involves holding direct reports from individual departments accountable for their departmental results on all levels. This means not giving anyone a pass when it comes to their budget just because they happen to also be valuable team members with amazing soft skills in their given area.
The committed leader does not blame the finance department when individual operating department numbers are upside down. Rather they are the quarterback who calls the plays.
They make sure the forecasts and budgets come from the department managers – and not from the accounting department – because accurate real-world numbers are needed for the smooth operation of a hotel. The finance/accounting department will not have those figures unless individual departments turn them in. But if they are not turned in, the finance department will need to make them up in order to create an operating budget.
This is where a financial leader is key. This man or woman of steel ensures each department head writes and owns their own monthly commentary. Our hero makes darn sure the daily communication around the numbers is consistent, positive, and clear. They make sure their team is provided with the resources and training they need to do this key job extremely well. And they take no prisoners. Blame and victims are not allowed on this ship.
That, my friends, is what Hospitality Financial Leadership is all about.
Available on Amazon in paperback, hardcover or Kindle format
At Hotel Financial Coach I help hotel leaders and teams with financial leadership coaching, webinars and workshops. Learning and applying the necessary financial leadership skills is the fast track to greater career success and increased personal prosperity. I significantly improve individual and team results with a proven return on investment.
Call or write today and arrange for a complimentary discussion on how you can create a financially engaged leadership team in your hotel.
Contact David at (415) 696-9593.
Email: [email protected]
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