Hospitality Financial Leadership - A White Paper on a 6-Month Client Workshop/Coaching Engagement – Part 2
December 19, 2017 12:36pm
The following is an overview of a six-month financial leadership project that I recently completed at a full-service hotel. The project consisted of six half-day hospitality financial leadership workshops delivered in-house and monthly 1-1 leadership coaching appointments with the 15 managers assigned to the program. Each month of the project we completed a group workshop and each manager had a coaching meeting with me.
The project goal had five measurable elements:
Get the core management team to do this each month, while improving these forecasts and the hotel’s financial results.
In case you missed it, read part 1 here.
Part 2 of 3
The DoF has three critical roles to play in this project. I worked closely with him throughout the assignment to ensure he stayed on track and to coach him on how to get the team to all produce.
One, the DoF must really want to get their managers doing their forecasts. Not all financial people are comfortable with this. Many would rather sit in their office, do the forecast and speak to as few people as possible. This will not work. The DoF in this property was very willing to open up to the leader’s needs. The first part of this process was to schedule monthly 1-1 meetings with each leader on the project. They met with the DoF and agreed which lines of the P&L they would manage and what exactly that meant as far as data and reports that the manager would need to do forecasts and the numbers the DoF needed from that manager and when. Each leader’s needs are different, depending on the department they manage and their level of experience. It is key that the DoF take the individual approach to ensure no one gets left behind. These monthly 1-1 meetings are a mandatory part of the project for the DoF.
Two, the DoF needs to communicate the monthly schedule and deliver on their dates and agreements. Critical cutoffs need to be understood by the management team and handicapped by the DoF.
If corporate needs the forecast by the 28th, do not set the 27th as the internal forecast deadline. Give yourself time to go back to the department managers after the original forecast has been consolidated to make changes. Make sure the final numbers in the forecast are the numbers the managers produce. This is the number one challenge DoFs have.
Here is how it plays out: The DoF schedules the forecast submissions from the department managers, these are consolidated, and the financial picture often does not add up. They are on a deadline from corporate, so they change a few numbers here and there to make the forecast work. You know what i mean, tweak a bit here and there. Meanwhile, the department manager gets the forecast back and someone has changed his or her submission. BIG MISTAKE. This is the number one “manager doing their own forecast” killer. Who would be willing to do this work to have someone change it in the 11th hour? DoF’s need to give themselves the time to work with the departments to produce forecasts that will work.
Three, the DoF must be comfortable with a little tough love and be able to hold their managers accountable. The monthly check-ins after workshop two are telling. I invited all managers to the front of the room one by one and they told their peers how they did the previous month.
“Did I do my forecast? Check or not? Did I track, did I adjust, did I review, and did I write?”
Sometimes the managers think they delivered, and I want everyone to know it is a black and white answer.
I asked the DoF after each person checked in, “Hey, DoF, are you in agreement? Did Chef do what he said he did?”
This kind of accountability and the communication of it in a group setting takes a certain kind of loving action and reaction because we are human, and we do not always want to confront one another. This is something I feel is a critical step in the team getting its wings. Are we willing to hold each other accountable?
The flip side of this is also key. Are my department managers willing to call out the DoF when they dropped the ball?
This particular DoF and hotel were challenged with this confrontation. He moved the needle considerably with managers’ accountability and his own responsibilities in the team setting. This was powerful stuff.
Switching gears now… about workshops and coaching
The anatomy of the workshops is a 50/50. Half of the time and effort is spent educating managers on the financial system. I incorporate the hotel’s actual current monthly statement in my content every month. I can fill the pages with what I teach over the six months, but here are a few of the menu items:
The other half of the time in the workshops is spent in group leadership exercises where we play games and interact. This is definitely the fun part and it is also how people learn best. Teaching adults accounting theory and principles is tough. Hotel leaders are not wired for this. They are GO GO people. The interaction and play time is essential to bring the learning home and allow them the opportunity to express themselves. This connects them with the content and their own personal commitment to moving forward and doing their part.
The one-on-one coaching time creates the catalyst to make the program much more effective.
Trust. I build a 1-1 relationship with each of the core leaders including the GM and DoF. The coaching is a confidential exchange. I do not share the leaders’ concerns or comments with the GM. I encourage the leaders to tell me what is going on and what is holding them back from their financials. What I learn I in turn use to “clear their path.”
The Want To. If you ask leaders if they would like to be “financial leaders” and have skills and confidence around the discipline, they are all going to say YES. I unlock their want to and turn it into how to. What do they need to do to take the next step in their journey? What do they specifically need to do in their department to get their forecast going? Payroll, expenses and their creativity combined with the overall monthly financial circle.
Innovation. Managers of the various departments have an arsenal of tools that no one knows about. I have seen amazing ingenuity and creativity in scheduling and expenses that managers just want to keep to themselves. I encourage them to share their ideas. It always amazes me to see what people have created, but are not willing to share. I make the sharing happen and we celebrate this with the team, and it is contagious.
Building a bridge. My coaching helps build the bridge that is always misunderstood in the hotel. That is the bridge between the operations people and the financial leader. They naturally do not understand each other and this masks itself in distrust. I remove this and build the bridge.
The last thing I will say about the coaching is it helps your leaders get really clear on who they are being. In the beginning, there is finger pointing and victim thinking. We remove this way of thinking and replace it with what actions they will take. Action is always the remedy.
With monthly workshops and coaching what we see is the team members starting to get on board with their financial work. They get on board because their team is counting on them and vice versa. They also get into the game because now they want to. Now they have a system to follow. They get their individual acts together because they see it is not so hard. Each month after the second month we do a check-in. Each team member is accountable for their individual contribution to the group. It is very interesting to see the team’s dynamics change as members get on board…and not.
Click on image to enlarge
The Only Thing We Know For Sure
I love teaching this part.
“The only thing we know for sure about the forecast is it’s wrong.” This is the truth about budgeting and forecasting. Knowing that the answer we produce is wrong is actually very good news. Why would you not want to take a shot and produce your department’s numbers for the monthly forecast knowing the results you are going to produce are always wrong? Zero risk is the answer. This is quite often the game changer that helps managers get into the project with both feet. Just do it once. Produce your department’s forecast—on time. Once this monkey is off their back, managers are on their way.
Management turnover is a killer and at the same time, it is the lifeblood of any hotel especially one that is new. Turnover in the hotel featured in the above workshop, during the six-month project window, was almost 50 percent. The turnover included the general manager. Every month there was another departure, sometimes more than one. This was a challenging aspect of the project and it was also a good thing: A challenge in the fact that the investment of time and resources into that leader was now gone. A good thing in the fact that the standards were suddenly upped. New leaders were interviewed with a much greater emphasis on their financial skills and commitment. New faces attended the workshops and coaching to express all the positive things they had heard and experienced in the financial aspect of their new roles. They were excited to be part of a team that had this financial thing going on. They knew something was up—something different—and each one of them brought new life and energy to the team.
The financial leadership bar had been raised.
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The Seven Secrets to Create a Financially Engaged Leadership Team in Your Hotel
Tags: david lund,
hospitality financial leadership,
David Lund is The Hotel Financial Coach, an international hospitality financial leadership pioneer. He has held positions as a Regional Financial Controller, Corporate Director and Hotel Manager with Fairmont Hotels for over 30 years.
He authored an award-winning workshop on Hospitality Financial Leadership and has delivered it to hundreds of hotel managers and leaders. David coach’s hospitality executives and delivers his Financial Leadership Workshops throughout the world, helping hotels, owners and brands increase profits and build financially engaged leadership teams.
David speaks at hospitality company meetings, associations and he has had several financial leadership articles published in hotel trade magazines and he is the author of two books on Hospitality Financial Leadership. David is a Certified Hotel Accounting Executive through HFTP and a Certified Professional Coach with CTI.
Contact: David Lund
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