The Future of Travel & Hospitality with Arne Sorenson, Marriott International

The Future of Travel & Hospitality with Arne Sorenson, Marriott International


It’s wonderful to be here. I’m just gonna take you in for a second. So how many of y’all stayed
in a hotel last night? [SOUND]
>>[LAUGH] Yay, hotels, me too. How many of y’all feel you
live in hotels these days? Yay, me too, hotels. To me, especially as I was preparing for this wonderful conversation to come,
I started to think about hotels, in particular, as a really unusual and
special third place in the modern age. You don’t really live there,
but you kind of live there. You don’t really work there, but
you’re kind of working there. Maybe you’re gonna sell
the deal of your life. Maybe you’re gonna meet the person of your
dreams and we go there to be adventurous, we go there to relax,
we go there to be productive. We go there to be royalty,
kings and queens of the universe. And we’re traveling at record rates
these days, which is a good thing. But not always by choice,
which is not a good thing and we’ll talk about that in a minute. So in a rapidly changing world,
the hotel industry can be one of the most important case studies to
think about how technology and empathy can make both the world better but
the experience of ourselves. So our conversation partner
today is a wonderful leader, Arne Sorenson who is the president and
CEO of Marriott International. Quite literary the largest hotel business
in the world with a portfolio of more than 6,500 properties,
30 leading brands in 127 countries, with 675,000 people either franchisees or under management and 110 million
loyalty members like you and me. But he also leads with his heart. He is one of the most outspoken
corporate leaders of the modern age and I know as Salesforce people, you know
how wonderful and powerful that can be. He’s advocated publicly for the health and
safety of the world, while working diligently and effectively to create
a more open and inclusive workforce. Here to talk about the future of travel,
and our lives, and absolutely everything
is Arnie Sorenson.>>[APPLAUSE]
>>Thank you.>>[APPLAUSE]
>>Hello, everybody.>>So I have to say my favorite part of
my job these days is saying wonder things about leaders when I know that
they are listening to them. So, thank you for that.>>Thank you.
>>So really true.>>That’s very kind and generous words.>>So, let’s talk about your the travel habits because we
just shared our’s a little bit. I imagine that you travel quite a bit.>>Yeah,
I travel about 200 nights a year maybe, 225 nights a year,
something like that but I love it. And I think that all the tips
are easier when you like travel.>>That’s true, but I mean,
you’re spanning the world. What are your three biggest tips, and
then we’ll get into the world here.>>Well,
they all can be summed up with go local.>>Yeah.>>Get on local time immediately,
and in fact, you can do that a little bit on
your flight on the way over. If you’re going to Europe, sleep,
because you’re landing in the morning, and when you get there in the morning,
don’t go to bed. Get some exercise, stay up. Going to Asia,
I will stay up on the planes, because typically you
arrive in the evening.>>That’s hard.
>>And it’s a bit of a gut sort of thing. You just got to force yourself to stay up. When you get there, you’re tired,
exercise, go to bed, you get the best night’s sleep. But be on the local time zone, eat the
local food, get out and see the sights. Don’t let yourself be living
as if you’re still at home.>>Yeah.
>>Because then you’re in neither place.>>Right.
>>You’re in sort of never, never land, but local time exercise, those are probably the two
things that are most profound.>>So let’s dig into your big picture and
vision for the hotel business and hospitality. Particularly where it comes to technology. Can you tell us a little bit about how you
think about the shiny future of travel while preserving the essential human
element of the experience of travel?>>Yeah let’s start with the latter
piece of that because I think travel has evolved. What we all want as travelers has changed
significantly in the last couple of decades. 25 years ago when I started traveling,
or 35 years ago maybe when I started traveling for business, we wanted not to
be disappointed with where we stayed.>>Right.
>>We wanted a decent sized room, a clean room, comfort,
no disappointment and the business travel was
a business travel trip, right? So let me be the place where I wanna work. Today I think we are blending work and
leisure all the time and we want an experience that’s intense. So I don’t want the same room that
I stayed in, in Asia last week. I want something that reflects
San Francisco for example, if I’m here. I want local food, I want an experience
even if I’m also on a work trip. And so we’ve gotta make sure that
we are driving that experience. It is a human-to-human business. Yes, there will be some
impact of automation, but it will not probably be fundamental. People still want to sort of
experience the places that they’re in. So many of us I think love travel,
because we’re get to come back and tell stories about it.>>Yes.
>>And so we wanna make sure we preserve that, that we are welcoming people
from everywhere by people or with people from everywhere. And so that piece cannot change. I think we wanna use technology
though in a way that says, how do we make it simpler for you?>>Mm-hm.>>Not just to make a reservation or
points from that reservation but to connect with experiences that
you can have in that market.>>Mm-hm.>>To have your room customized
to some extent, that it would be easier to do in a luxury property
maybe than a lower rated property. But still have a room that reflects
the fact that we know you. If you’ve stayed with us before, we should
know something about what you like. And then also have technology that allows
you to communicate with the hotel. Think about where
the landlines are now left.>>Right, right.>>Hotel rooms.>>Right, right.>>It’s the only place
that we have land lines. Part of that is because you need it for
security reasons, or for life safety reasons,
if there’s a fire or an alarm.>>Right.
>>But part of that is we haven’t done a very
good job in allowing you to take the device you wanna use, your phone and communicate with the hotel
while you’re in the hotel. And so those are some of the areas
that we’re doing a lot of work.>>So, what would you say has been your
biggest bet when it’s come to technology?>>Well that’s a good question. I think we spend a lot
of money on technology. We’re spending hundreds of
millions of dollars a year. It is mostly about investing in
the loyalty and reservations platform. They’re big bets but
they’re not risky bets in the same way. I think that the biggest bet that has some
risk in it, which is not unrelated to this, was our acquisition of
Starwood a couple of years ago.>>13 billion.>>$13 billion, biggest deal by
a lot that Marriott’s ever done, we were a $20 billion
company when we bought them. So it’s risking a fair
amount of the company. And while it isn’t at it’s core maybe, a technology bet,
it was a bet on the loyalty program. We said, if we can bring these
two companies together and have a bigger ecosystem for our customers
so that they are really our customers. And we could say to them,
why would you stay anywhere else? Why would you stay anywhere else? That would be a good thing. We could know them better. We could essentially take two companies
that were investing in separate loyalty and technology platforms and
invest in one and by doing that, drive some of these features around
customization, and personalization, and communications, that we
know we’ve gotta get to.>>So you mentioned risks, what would
be some of the riskier elements of technology for you and we’ll get to where
you’re using Salesforce in a second. So virtual reality comes to mind, the fact that you know me
when I come into the property Is delightful when I come into a property,
but yet it’s creepy when I’m on Facebook? That kinda thing,
how are you walking that fine line?>>Yeah, that’s an interesting one,
you’ve got two examples I’d use today, one is a regulatory one. So we are increasingly
living in a world in which data will be required to be maintained in
the country of residence of your customer. GDPR in Europe is probably
the most profound, the Chinese are heading the same way. California, of course,
passed a law last year. All of this is going to have
some impact on where we can keep the information we have about you. And to some extent, how we mine it, can
we mine it through pure anonymous tools? Which probably we can do some of,
so that’s an area of risks. I think a second one, and this sort of gets to the thing you
were referring to in your question. We have a number of hotel rooms that
have got voice devices in them.>>Right.
>>And with both Apple and with Amazon, and I will hear from
customers occasionally. I don’t want that thing in my room,
because I think you’re listening to us.>>Right.>>And I’ve got four adult children,
I talked to them about this. They’ve got these devices
in their apartments, I’ve got these devices in my closet.>>[LAUGH]
>>Never taken out of the box, maybe it’s a little bit about age,
but it does prove this point. Can we be confident that that device only
turns on when I wanna order room service?>>Right.>>Or is it somehow on and
listening otherwise? And that we’re gonna work
through as a society. I mean Marriott can have a role in
testing that with our customers. We’ll have some customers that
say I don’t want any part of it. But think collectively, we will get
either comfortable with this and it will be everywhere. Or we’ll decide that somehow it goes
over the line a little bit, and it won’t be everywhere.>>So you mentioned Agent, I know that the world is traveling
in ways that it never has before. How are you thinking about creating custom
experiences for a young Chinese couple? Or an aging Baby Boomer, or a business traveler who’s coming
from a previously banned country?>>Right.>>These are the things, when I think
about the enormity of the ways that you have to think about serving people. It’s fascinating and almost overwhelming.>>Yeah, it’s interesting, I get asked
questions about Millennials all the time. And I think it is dead wrong to assume
Millennials like the same thing. And that somehow collectively they like
different things than the Boomers liked, and that the Boomers all
liked the same thing. And actually when you look at
the data that we get to see, you will see that we are all
different from each other.>>Right.>>We might be born on the same date, and
we’re still different from each other. And so, it’s not about a generational
change, it is instead about saying, back to where we started,
how do we know you better? So we can give you the tools that
you want to use when you travel, give you the food that
you want when you travel. One of the things we’ve been doing
with the Chinese traveler, and those numbers are enormous. 15 years ago, a million outbound
trips from China a year, last year 135 million and
they’re going to 500 million. And the first things that we want
when we travel to a strange place, whether we’re Chinese or
Americans, or what have you. We want the comfort elements at the times
of day when comfort is most important. Think breakfast, think about your news,
which has gotten to be much easier, because we all carry our news with us. Think sometimes about the bed,
and the way that that works. Slippers, we talk about for
the Japanese and Chinese travelers, because they love their slippers. But you’ve gotta make sure that
language and breakfast food, particularly, are there to welcome people. And beyond that, you start to get
to sort of unique attributes, what is it that you want when you travel?>>Right.>>And that technology will help us solve.>>So, as you’re talking, I write
a daily column on race and culture. Over the last two and a half years, it has
been a crazy time to think about this, and to write about it every day. But I’ve studied companies who
are doing a good job on creating an inclusive workforce. Which we’re gonna spend a little more
time later on, but it occurs to me too. That by welcoming so many different
kinds of people from around the world, you’re almost a natural condenser
of inclusive knowledge. How are you thinking about this
in terms of training your staff? In being not just from the local area, but understanding someone who’s
very different from them.>>Yeah, I think to some extent we
are a little bit self selecting, because->>You’re there to serve.>>Because we’re there to serve, and we are welcoming people literally from
everywhere, and think about about that. Not as just describing
a geographical source, but think about that as
describing identity as well.>>Yeah.
>>We are an extraordinarily diverse group of people, welcoming an extraordinarily
diverse group of people every day. And if you’re not interested in that,
you’re not likely to be working with us. And so that helps, I think it
takes us a long way along the way. I think that the second thing, which is
really useful to me, I’ve been CEO for six and a half years. But the company is 91 years old,
and it didn’t use the words diversity inclusion, or
words like it 91 years ago. But early on,
they said take care of the associate, and the associate will take of the guest. And the guest will come back again and
again. And what they meant by that was,
build careers for your people.>>Right, give them a future.>>Let them achieve their potential,
no matter where they came from. My first exposure to the company
was in the early 90s, and in the boardroom, the stories told. Were about associates that had started
at entry level jobs in hotels and become fancy executives. They were not stories about the blue chip
schools that the fancy executives went to.>>[LAUGH] Right.>>And that is a cultural heritage
which is a really powerful one, and something that we fight
very hard to preserve. Because we wanna make sure that no matter
where you start, no matter who you are. You’ve got the ability to move and
grow in your career. And that also will feed this
inclusiveness, I think.>>And you don’t even have to
be a Marriott to be the CEO.>>You don’t even have to be
a Marriott to be the CEO, that’s right.>>This is a huge change for this company,
you’re the first non-family member, you’re not a family member?>>Correct.
>>[LAUGHS] To take the helm, what was that like, how was that process?>>Well, it was great, and
in a sense from the inside, it’s less revolutionary than it
feels like from the outside. So six and half years as a CEO,
I’ve been at the company for 22. And before getting there, I represented
Marriott as a lawyer which was my last career, and
got to know Mr Marriott well. I worked with him essentially through
that whole period of time, and this transition evolved. So I had lots of years to sorta think,
yeah, I might be following him. And so I was learning from him, it was
crystal clear that I’m not a Marriott. I can’t step into the job and
pretend to be a Marriott. So I had to do the job in a way which
is consistent with who I am, and not pretend to be something that’s-
>>You blend in better than I might, though. I mean you really do exemplify
the kind of corporate executive track that ends up in
leadership positions.>>Yeah, and also great good fortune.>>Yes, too true, too true.>>Good luck, being at the right place,
at the right time, there were people at Marriott-
>>Hard work.>>Who could have easily done this job,
but the time wasn’t right.>>Yeah, yeah, yeah.>>And I happened to be there at a time
when it fell in my lap, and of course, I love it. I think that part of the reason why
it was such an interesting move. Cuz in a cynical world
it’s easy to believe that a wealthy business person only holds
space for their own relatives. We’ve seen that play out in public
life recently in an alarming way.>>Yeah.
>>And that they’re actually making room for
other talented people to come up, I think it’s a beautiful thing.>>Well, again, everybody deserves a shot. [LAUGH]
>>I would be remiss if I didn’t ask about your relationship with Salesforce,
and the kind of technology, and how their technology is helping
you achieve your goals.>>Yeah, well make sure you see the
keynote this afternoon because Mark will talk about some of the things
that we’re doing together. And we’re really excited about
the partnership we’ve got with them. We think we have about 140,000 of our
associates that are using Salesforce tools now.>>Wow!>>And of course, it started with tools
that our sales team used above property. But increasingly, it is going to, every
screen at a hotel which tells the front desk agent who you are when you come in,
and populated with the right data.>>Right, which delights me but
doesn’t frighten me.>>We wanna make sure we
don’t freak you out, but instead welcome you, and
that work is really exciting. And it will be further enhanced in
the near future with information we’re getting from other sources. That might tell us whether you’re gonna
be late, whether your flight’s delayed. Or whether there are other aspects of
your travel that we should be mindful of when you show up.>>That’s extraordinary. So I wanted to switch gears and talk about
leading in the hospitality business, and also [INAUDIBLE] in the world. You wrote an extraordinary letter after
the most recent presidential election. That outline some concerns that you had,
but ideas about how this country could continue on being
an opening and a welcoming place. Could you tell us a little bit about why
you wrote the letter and what was in it?>>Yeah, the week of the election, I wrote a letter to president
Trump who I had never met. And in part because I didn’t know him,
I couldn’t send it to him, so I put it on LinkedIn.>>[LAUGH]
>>And described it as an open
letter to President Trump. Election, of course, was on a Tuesday,
my 89-year-old mother had passed away on the Friday before,
and so I was writing that week anyway. I was writing her story which we were
gonna use at the memorial service coming up for her. And as an 89-year-old died in 2016,
she was a Depression-era child, World War II, Adult essentially. She and my father had gone to Japan and
lived there for 13 years, which is where I was born. And so, I start telling that story which
was about her and was very personal. But was also about the era
that they had lived through. And then Trump is elected on the Tuesday,
and I’m surprised by that, as many people are. And thinking, okay,
both for me, personally, how do you get your head around, we have
a new leader who has said certain things? What would you really advocate that
he do in a way that is consistent with what he said? And then, of course, we have our
own audience of 700,000 people, roughly, who wear a name badge every day. Who were thinking okay,
what does this mean for me? What does it mean for the company? And all of those things are went into,
but I wrote the letter for me first, to force me to think about it,
for our associates second. And as a distant third, maybe a notion that somebody might
read it in the administration. And just to pick on one example in there,
there is a focus on, it’s a short letter, it’s still available,
I think, on LinkedIn. But there’s a paragraph about keeping
the government out of the bedroom and the bathroom. Bathroom, of course, because of what
had been going on in North Carolina, particularly. That is a Conservative formulation of, An inclusive voice for the LGBT community.>>Right.>>Conservative in the sense that you’re
saying, let me be who I am privately.>>Right.>>And I use those words because again,
the audience was, you’ve got a new president. He’s not gonna come out and
be a flag waver for the LGBT community. How do we marshal an argument that
is gonna make sure that we retain the progress we’ve made so far. And we continue that, that progress. So throughout that,
it is an effort to try and say, here is policies which I think
will be constructive and useful and here is why they
are policies you, President Trump. Should feel like you could adopt without
being inconsistent with the campaign that you have run. What was the response to
you posting the letter?>>Well I hear about it all the time and
I get->>It’s a good letter.>>Of course, I’m travelling all the time
and I’m in our hotels all the time. And every week, I get an associate who
will give me a hug and say, thank you for doing that letter. Or something else along the same lines. And so from that perspective,
it was well read, I’ve met President Trump twice now since,
I was in the White House two weeks ago. As far as I can tell,
he has never read the letter.>>[LAUGH]
>>Now, I didn’t say, did you read my letter?>>What a missed opportunity,
if you he had written, he would have brought it made you read
it right in front of him perhaps.>>Yeah, good answer.>>[LAUGH] What were you
in the White House for?>>This last visit was for a conversation about inbound international
travel to the United States.>>Yes, I imagine the travel
ban was mentioned and things->>Travel ban, we talked about and of course, the countries that
the travel ban applies to literally are not big source markets for
travel to the United States. But the voice that comes from
the United States is a big voice and one of the things I said
to President Trump is. We’re not here to argue against security,
we obviously need to be protected. We’re not here necessarily to argue
about what immigration policy should be. We’re not talk about people
moving to the United States. We are talking about, do we communicate a
welcome to the rest of the world, to come here to do business, to come here to see
the place, to come here to see people? By the way everybody who comes to
the United States, not everybody. But overwhelmingly, the people who come
to the United States go home with a more positive view of the United States than if
they didn’t come here in the first place.>>Right.
>>So there’s a soft diplomacy. So I said, yeah, you can talk
about security and immigration. But be careful that your voice is not
heard by the rest of the world as saying, you’re not welcome here.>>Well, I appreciate you.>>And he actually, to his credit,
I was a little, maybe, close to the line, but he said, I understand that, and we
should be able to do something about that.>>Well, good for you for raising it. Because you really are in a position,
which is something I hadn’t fully considered before, as I mentioned before
I prepared for this conversation. That you are really in such
an unusual position to impact really pressing social issues like
immigration, like trafficking. Could you tell us a little
bit about your work there?>>Yeah,
we have trained I think three or 400,000 of our associates now on how to watch for
trafficking. And it’s a tough thing
because you are essentially telling folks to keep their eyes open,
often in uncertain circumstances. The folks who are gonna be
Visibly restraining somebody, they’re probably not gonna
check in to our hotels. That’s probably not what,
that’s not the picture we’re gonna see. We’re gonna see something that’s
much more nuanced than that. But we know that it is happening. We know that it is devastating to
the folks that are victims of this. All of us want to make sure we do
what we possibly can do to help them. And the stories have
been pretty interesting. Some stories from the rest of the world. I think probably many of us here
assumed this is a story about the sex trade coming out of Asia or coming out
of some part of the developing world, and not necessarily something here. We’ve had stories here in California, where minors have been grabbed in
a parking lot and they show up in a hotel. And we’ve had associates who
are heroes who have seen, there’s something about that picture
that doesn’t make sense, and they consult with each other and
they call the authorities. And if you can get a handful or
a few handfuls of this, which have an impact,
that’s pretty powerful.>>You’re sort of describing that
the dream of technology that we were originally thinking about just even
a couple decades ago, that it makes for seamless experience for
employee and guest. It makes things easier so that
the human beings can actually interact with each other, and pay attention to each
other, and see what they actually need.>>Yeah, the other place we’re spending
a lot of time is in the airport process. And so if you think about it’s
a pretty young crowd here, so probably not too many remember,
as I do, when I started travelling. There was no security in airports.>>[LAUGH]
>>I practiced law downtown Washington and would fly out of National Airport. And I could leave the office about
20 minutes before takeoff time and get to the airport and
be on the plane, and simply walk, walk right onto the plane
with essentially no security. And now if you pause and
you look, look at SFO, if you’re leaving from there tomorrow or
Thursday or Friday, and you see the amount of infrastructure that we’ve got on
security, 99.9% of us represent no risk. It’s actually, the number’s
probably even higher than that, but we all go through more or
less the same process. Yes, if you’re TSA Pre,
maybe it’s a little bit abbreviated. If you buy Clear,
it’s a little bit abbreviated, but we’re still going through
the same process. And there ought to be a way where
we say we know who you are. And you don’t have to do anything.>>So this makes me nervous.>>Does it?>>This makes me more nervous than
having the cookie waiting for me, which I love at the hotel.>>Because, because?>>Yeah, it’s because it doesn’t
feel like you control the space. It feels like you can,
like I’m not in your home anymore, and then a public space that has
under multiple jurisdictions. I only signed up for Clear under
duress because I was late to get home, my kids were gonna show up,
it was one of these crazy traveler things. It’s like fine, here’s my 30 bucks and
here’s my thumbprint. It’s like now you own
a piece of my identity. So these things, I know it’s you,
and is it Accenture?>>Yeah.>>Companies I know well and trust. But I am confessing here
in front of our friends, that it makes me nervous where an entity,
as irrational as it sounds, doesn’t seem attached to a place
where I am, knows intimate details about my thumbprint or
just my movement or my activities.>>They’ve already got it.>>I know, it’s over, it’s over.>>[LAUGH]
>>I mean, I’m with you.>>I’m a journalist, I’m a fear-based
animal, I’m just confessing. [LAUGH]
>>I’m with you on this in many respects.>>It’s over.>>But they’ve already got it, and
this is not about us getting the data. This is about governments who
are running this process. And already they’re taking our pictures.>>I know, it’s over. Already they’re taking our finger prints. They know it all. And if they’re gonna know it all, they might as well use it in a way
that helps us lead our lives better.>>Well, would you ever consider
running for public office, cuz that would make me feel better?>>[LAUGH] Would you vote for me?>>I would.>>There we go, okay.>>Yeah, I said it. [LAUGH]
>>I’ve got a great job, I love it.>>I knew you were gonna say that. [LAUGH] Let’s go back to happy place, let’s talk about the Love Travels
movement, the hashtag and the promotion. Tell us a little bit about
that campaign and why you.>>Yeah, so Love Travels, we’ve been out, my teams here, five or
six years, something like that. And it started really with
the LGBT community as a way of marketing, celebrating, communicating. And I think we have since
not just embraced that, but used it to sort of embrace
all of diversity and inclusion around the love,
and it’s really fun stuff. Because it is a way of talking about
the things that I’ve already mentioned, how do we embrace everybody? How do we genuinely welcome everybody? So often when we’re traveling,
particularly for personal reasons,
we’re traveling with a loved one. They are the most important occasions
of our lives, our honeymoons, our anniversary trips,
our bachelorette parties, whatever it is. And you put all that together and say,
how do you come up with something that is feel good, but inclusive,
and powerful, and celebratory? And that’s why Love Travels, we’re still
using five or six years after it launched. Marketing campaigns often tend to have
a shorter shelf life than that, but this is one that just feels right to us.>>Yeah, and times have been very odd,
it’s excellent. Speaking of diversity and inclusion,
you have a remarkably diverse board, which is wonderful to see. You’ve set some pretty
aggressive diversity and inclusion benchmarks including with your
franchisees, which seem to be on track. And I appreciate that it was sort of
baked in from the beginning in terms of taking care of the associate. But this is really unusual, as someone
who studies corporate diversity for a living, you are outside
of all the benchmarks here. How do you think you’ve done it?>>I think the cultural
heritage is a big piece of it. This business about how do you succeed in
your work, no matter where you come from. And that means you’re not picking
from only Wharton grads, for example, for finance jobs or
fill in the blank for various disciplines. You’re basically saying who are the folks,
yes of course we want people who are beautifully
trained and educated and smart. But we also want people who are learning
through their experiences and don’t necessarily have to check all sorts of
boxes in order to be considered for jobs. And that cultural heritage,
I think is really important. I think two, we’ve been, we of course
have measured this and have set targets. We’ve had a board management committee
called Committee for Excellence, which is about diversity and
inclusion for, I think 20 years. And that is a selection of our directors
plus management getting together probably twice a year,
maybe three times a year. And setting targets and
measuring against them and making sure that we
are doing those things. I think we’ve also had
really good fortune. We have great, diverse board members, we had relationships with all of them,
and it worked for us. Half of my direct reports are women, none of them have their
jobs because they’re women. And I feel lucky and
fortunate that the talent we had in the team to choose from Made
them the right folks to choose. And of course,
the success feeds on itself. So women leaders in the companies see
these very senior women execs and say, I like what I see. And this makes me love
this place even more. And so that,
it all sort of builds on it of itself.>>To get back to the technology piece,
it is the world is changing rapidly and we all to think about that both
has threaten opportunities. But the technology would
which we’re using, and developing, is also changing very rapidly. I had interviewed a Senior Executive
at a big retailer who was working on integrating the customer
experience from mobile to tablet, and so it all felt the same. And it was a brand new job, and he was
struggling to transition as we often do, and said that the advice that he had
gotten for his peers in different companies was, expect to lose 70%
of the executives you have now. And it was such a shocking piece of advice
to me that on Monday these extraordinary people that you were working with, who had
been excellent in every way, by Tuesday, because we have a new initiative,
or a new piece of technology, are no longer up to the job. So I wanted to run that by you,
cuz I am horrified by what that means for the workforce, and also what does
it mean for technology adoption? Are we really going to
be disrupting things and people in the best way if we’re not
able to bring our leaders along?>>Yeah, I mean, it feels to me like there are a few questions wrapped into that-
>>No, I know.>>That conversation. A part of it is about do we
stay with that company, and do we stay with a mission or
cause for a decent period of time. And if we don’t, why are we not saying it? Is it purely about wages and benefits,
you know, the economic aspects of it, or is it something else about the culture
of the place where then engaged with. And I think, if it’s the former,
that should be fixable, right? We should be saying, okay, well, wait a
second, what is it we need to do in order to make sure we’re keeping people-
>>Right.>>From a pay and benefits perspective. If it’s the latter,
it should be fixable, too, but real effort has gotta be put into it.>>Okay.
>>Do you feel, do I feel personally connected to the work of Mary Ann? I do, do most of the folks in the company
from senior jobs to the most junior jobs? I think many of them actually do. We, of course, still have turn over, but
one of the advantages of a family heritage company, a company in the hospitality
space, a company which is focused on it. We’re not perfect by the way, we’ve got lot’s of things
we’ve gotta stay focused on. But if I can connect to that company
in a way that feels personal to me. If it feels like the company cares about
me personally I’m much more likely to say this is a place I want to continue to,
even if it’s in technology, reinvent and disrupt the technology we’ve done before.>>Push through the hard transitions.>>Yeah.>>So from my perch at Fortune,
I’m increasingly around leaders and executives, at every level actually,
who are more likely to do just that, to state publicly that they
care about certain things. They care about not only their employees,
but they care about their impact on the world. Is that something that you’re seeing too,
and is it particularly as the complications
of the world are coming up? And it’s everything from immigration
to migration, to climate change, we haven’t talked about climate change.>>Yep.>>The opioid epidemic, it’s just it all
employers are dealing with all things now.>>That’s right.>>What is your best advice for
someone operating at any level to better link their authentic will to have
better impact with their daily jobs?>>Yeah,
when we started our green council, focused on sustainability obviously, about
12 or 13 years ago, maybe 14 years ago, we had a number of environmentalist
come in and say you know, here’s what’s happening externally in the world,
here’s some things you can think about. And I won’t name names,
cuz they were private conversations. But I asked a couple of them, tell me how we should think
about what we do in this space? How much money should we spend,
is it a percentage of what were spending, is it you know. Philosophically give me advice
about how we go about this. And the most powerful advice was,
you should do everything single thing that drives sustainability
that makes economic sense. And you should hold the environmental
industry to deliver tools that are economically replicable. Because if we adopt lower standards,
it’s too hard, over a sustained period of time,
for companies to do that. Yeah, you may have a CEO who
loves the space, who’s gonna say, I’m going to force it to happen, but
as a long way of answering your question. I don’t think that that is
necessarily gospel, that answer. But I think there’s some wisdom in it, and
a couple of things that we’ve done for example, we talked early on about low VOC
paint, volatile organic compounds, which is obviously better environmentally, was
more expensive than the traditional paint. But we went to the paint suppliers,
and they said listen, if you’ll buy only low VOC paint,
we’ll sell it to you for the same expense, because we could deliver the volume. And that’s the great thing about being at
a big company is you can actually use your mass to say, we’re gonna do things that
we couldn’t do if we were on our own. But again, if I’m a senior exec,
a mid-level exec, a starting employee at a company
I can look around and say, okay, what are we doing that does not
have a positive sustainable impact? What are the things we could
do to change the way it works? And does it save money,
does it cost any more money? Does it impact the way we perform our job? And most of us can look around and
find opportunities to drive better sustainability simply
by being thoughtful about it. And nobody will fight you,-
>>Right.>>Nobody will fight you.>>Right.
>>Now, if you come in and say, I have a whole new approach to
doing business which is gonna be more sustainable, but
either way the cost is 2X, then you’re gonna have a hard
time getting that through. Now, it might still be worth having that
dialogue, but again, be the change agent. For us to have enough impact, yes,
we can do some things globally, but we need champions in every single hotel.-
>>Yeah.>>Who say, I can see what’s happening
in my hotel around energy usage, or water, or trash,
those are the three big areas. And I can see places where
in this precise location we have opportunities to do better.>>So we only have a few minutes left, and
I wanna make sure that we hit everything you wanted to hit today, but I did want to
ask you about your taking on a technology company directly into
the home marketplace. Obviously I’m talking about Airbnb here. Tell us a little bit
about that thinking and how much of the risk do you think
this is for your core business?>>So for those who don’t know,
Airbnb is a home sharing business, have ever heard of Airbnb?>>[LAUGH]
>>The, I think, a local company here.>>[LAUGH]
>>We of course have watched them and others since they started. And by and large Airbnb has offered
a different product than a hotel room. And it’s different in a number
of respects, but I think for the bulk of their product, the difference
has been, it is a lower cost to stay. Yes, of course, there’s a local flavor,
and sometimes that can be a piece of it. But often when you listen to travelers and
say, where did you book last night, why’d you stay there? The answer’s gonna be,
well, it was cheaper. San Francisco was really
expensive during Dream Force Week.>>Right.>>And every hotel was full, and
I could get a place that was cheaper. Maybe materially cheaper, but
maybe also not as good as a hotel room. And we don’t really want to be in
the business of providing the cheapest accommodation. We’ve never done that,
we don’t have a budget brand, for example. We wanna make sure we’re providing value,
but we’re providing value sort of in the mid-point of the market
all the way up through luxury. But we watched this space and said, but there is a bit of this business
which is a whole home. I’ve got four kids. When my wife and I go travel,
which we love to do. Sometimes we end up in a house because
we want to have another family of four, five, six, seven with us. Suddenly you’re needing six or
seven bedrooms. Hotels are not built great for that. And so we said, let’s start in London and
let’s do a curated, whole home collection. Now a home in London might be
a flat in a building, obviously. But with multiple bedrooms,
with services that cut the risk that you’re gonna end up with a host that’s
delivering a product which is not good. Connection to the loyalty program. And it’s not huge,
we have 200 units in London out of, we have 1.3 million hotel rooms today. So you can see an order of magnitude,
that’s not very material. But I suspect we’ll grow into additional
markets, albeit at that whole home space. Where I think our customers will say yes,
that’s a new and different product from the traditional
hotel room and we’re glad you’re there.>>Excellent, very good. So we’re almost out of time, and I
thought we could end up where we started, which is your vision for
the travel future. And now what we’ve woven in some of
the big challenges that we’re facing. It’s political challenge, it’s climate,
it’s migration, it’s war. What do you see the role
of the hospitality industry in addressing some of these issues or
just making the world more welcoming?>>Yeah.>>I’m gonna use this for
your presidential campaign.>>[LAUGH]
>>So deliver it straight to
the audience please. [LAUGH]
>>I love this business, and I love this business because it does
appeal to our better selves I think, in lots of respects. Not exclusively, I mean I think sometimes
we can splurge in a way that maybe is a little bit selfish, but that’s okay too. But it appeals to our better
selves in the sense that I think we are collectively pretty open-minded. We have forces sometimes that
drives us to be close-minded.>>Yeah.>>But when you talk to people who
have had a chance to travel or who have diverse friendships, everybody
feels better by both of those things.>>Right.>>I’ve never heard anybody who has said, I didn’t appreciate going to see
something that I hadn’t seen before. Or I didn’t appreciate meeting somebody
who’s not part of my obvious cohort, the neighborhood I grew up in,
or the school I went to. And I think collectively we want that. There’s a book I just read
called The Soul of America, Jon Meacham just wrote it,
a great American historian. And essentially he looks at political
leaders through our 250 year history, and those that have appealed
to our better natures. Often with beautiful rhetoric,
you know, FDR, Martin Luther King, a whole bunch of
obvious names are in this, Lincoln. As folks who have essentially said, here is a vision that we
should be pursuing together. We can’t in the hospitality space
be that lofty, but we can say, we will fight every single day to
help you go experience the world. Go experience the town next door, go experience through a local
vacation that you’re taking, something about a new experience for you. And we can do that in an environment
in which we will fight every day to make sure everybody’s welcome. To work there, to visit there,
to eat there, to meet there. And in our little space at least, hopefully we can appeal
to our better natures.>>Beautiful. Arnie, thank you so much.>>Thank you.
>>What a pleasure.>>[APPLAUSE]

5 comments

  1. Arne Sorenson is a phony self-entitled opportunist, and an elitist social-climbing jerk. In July of 2017 he had an un-televised interview with Bloomberg TV during which he called Starwood members "rabid" (which comes from the Latin word "rabidus" meaning "mad", "crazy", or "extremely obsessive"). Arne doesn't really care about his Marriott members or the LGBT community at all.

    He only cares about his shareholders, profits, and his huge annual bonus. He is only posturing and overselling his political values and ideology, which will ultimately lead to his downfall. This is a tactic that almost all lawyers and politicians use when publicly stating their case & agenda.

    Marriott is projected to lose at least 8% to 12% of their core members (Platinum Premiers) within the next year, because of Arne's incompetency & greed by trimming as much benefits as possible, and then calling it "Enhanced". Arne will be forced to resign when Shemaiah Enterprises begin to threaten Marriott's bottomline.

  2. Outstanding video recording! Hereabouts at Y&S FOOD! we adore to find this style of contents. We make Travel & Food video too, across the world, so we are frequently seeking inspirations as well as techniques. Thank You.

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