Man for all seasons
Isadore Sharp’s business model and emphasis on people ensured Four Seasons’ transition from just another hotel chain to a by-word for quality. Vir Sanghvi talks to the hotelier...india Updated: May 30, 2009 21:17 IST
But many of us will also wonder: when did Four Seasons reach this level? I first stayed at what is now the London Four Seasons (back then it was called the Inn On The Park) in the 1970s and though it was a good hotel, nobody in the city regarded it as significantly better than say, the Intercontinental next door or even the great grand hotels of London: The Dorchester, The Savoy, The Berkeley, Claridges, The Ritz etc.
How did Four Seasons – which started in its native Canada in the Sixties – make the transition from being just another hotel chain (like Hyatt or Intercontinental) to becoming a by-word for quality?
My friend Uday Rao, manager of the Bombay Four Seasons, gave me a copy of Isadore Sharp’s recently published autobiography (it’s called Four Seasons) to see if I could find any answers. As anybody in the hotel trade will tell you, Sharp is a legend. He founded Four Seasons and though he eventually sold most of his stock to Prince Al-Waleed and Bill Gates, he still runs the company.
Sharp’s is an interesting story. Born into a family of Jewish refugees from Poland, he started out, not in the hotel trade, but as a builder. That business led him to hotels but till the late Seventies, he and his company were considered upstarts or small-timers by the big European and American chains.
Then, Sharp decided to change his business model. Four Seasons had four hotels in Canada and just one in the rest of the world (London’s Inn On The Park) but he decided that he would create the finest hotel company on the planet. Because Four Seasons was not a big company with access to resources, he chose to recast it as a management firm. Four Seasons would no longer own hotels. It would manage them for others. <b2>
This was not an entirely new concept. In the mid-Seventies, such companies as Hilton, Sheraton, Hyatt, Hilton International (a separate company from Hilton in the US in that era) owned only a relatively small proportion of their properties. The rest were owned by different entities but managed by them. But no company had ever said that it was not interested in owning hotels.
Sharp changed some of the rules when he said that if anybody wanted Four Seasons to manage his hotel, he would have to put up all the money, build to Four Seasons specifications and then wait for the property to become profitable eventually while continuing to pay management fees to Four Seasons all the while.
This formula could only work if Four Seasons guaranteed that its hotels would be (a) classier than the competition and (b) more profitable. So Sharp set about upgrading the idea of a deluxe hotel.
Some of his innovations: rooms that were larger than competitors’ rooms; quieter plumbing, better showerheads, larger bathrooms with both showers and bath-tubs, high quality fabrics (no polyester, no vinyl etc.) gourmet cuisine, more amenities in the rooms (Sharp says Four Seasons was the first chain to put hair-dryers in all bathrooms), state-of-the-art beds and bedding (mattresses, pillows etc.) and luxury bathrobes.
Over time, nearly all of these innovations would be copied by other chains and as the concept of a better-than-luxury hotel took hold, other chains started rebranding their properties to make a distinction between ordinary five star hotels and super-deluxe hotels. Sheraton has Luxury Collection and St Regis; Hilton uses Conrad and Waldorf-Astoria as differentiators and even in India, our chains have changed their branding: the old Oberoi Towers in Bombay has been downgraded to a Trident while the new Oberoi is treated as a luxury hotel and Taj now makes a clear distinction between luxury and premium five star hotels.
But what few foreign chains have been able to match is Four Seasons’ reputation for service. This may seem like less of a big deal in Asia where staff costs are lower than in the West but in America and Europe, many five star hotels are so sparsely staffed that service can be non-existent. (This is true of better-than-luxury hotels too. The Waldorf Astoria in New York – run by Hilton – has the worst service of any five star hotel in the world.)
At a Four Seasons, service will be personalised and effortless. Sharp pioneered the emphasis on people – not just guests but employees as well. He argued that unless luxury hotel employees were well-treated, well-trained and happy, they could not deliver a luxury experience. (Four Seasons salaries are among the highest in the business.) So, there is less of a sense of hierarchy and a greater empowerment of employees.
And then, there are the systems. Sharp says he brought the concierge system to North America (he doesn’t believe in room butlers) and made it clear that if a guest came down to the concierge’s desk at 2 am and said that he or she wanted a ticket for a 5 am flight, the concierge should be in a position to arrange it.
Four Seasons also introduced a detailed system of reporting and communication. For instance, if a guest has to wait 20 minutes for a hotel valet to bring the car, the doorman will record it and the guest will get an apology call from the general manager within an hour. If a guest is leaving a restaurant to go out and call his car, somebody from the restaurant will warn the doorman that he is on his way so that the guest is addressed by name when he gets there.
For all this, Sharp is also candid enough to admit that the breakthrough for Four Seasons came with the acquisition of Regent Hotels in 1992. Regent, a joint venture between hotelier Bob Burns and Japanese investors, changed the rules of the luxury business even before Four Seasons did. (Not that Sharp says so.)
When the Japanese economy collapsed in 1991, Regent’s Japanese co-owners went bust and the banks took over. Sharp struck an innovative deal with the banks and bought Regent and its 15 properties, many of them in Asia.
It also gave Sharp three exceptional properties that were under construction. The Regent in Bali, a high-end resort where every room had its own pool, became a Four Seasons. So did a 14th century monastery in Milan that Regent was converting into a hotel. And of course, Four Seasons finally had its own hotel in New York when Sharp changed the name of the Regent, designed by I M Pei and still under construction, to Four Seasons. (Before that, Four Seasons managed the Pierre – now owned by Taj – but it wasn’t really a Four Seasons hotel.)
It was only after the Regent acquisition that Four Seasons became a truly global company. And time was on Sharp’s side. By the mid-1990s, the financial markets were booming and globalisation was the mantra of the era. Four Seasons quickly became the hotel chain of choice for global investment bankers as they flew from London to Singapore to New York. Because the financial community was swimming in money and this was an era of excess, the bankers did not mind Four Seasons’ high prices – rather they treated them as a guarantee of quality.
One of the chapters in Sharp’s book deals with A Few Bad Apples, dealing with partners who never worked out. Predictably, Captain Nair of the Leela group is one of them.
According to Sharp, Nair approached him in 1994 to manage the new properties he would build. Sharp went to India, saw the Leelas in Bombay (“clearly successful”) and Goa (“needed an extensive renovation”). Sharp asked Nair, “Why do you need Four Seasons?”
“My family and I,” Nair replied, “can manage these hotels. But I have a dream, a vision of what the Leela group could be.” He told Sharp that he wanted Four Seasons to manage new properties in Delhi, Bangalore and Madras.
Sharp agreed and Four Seasons developed the concept and design for a new hotel in Bangalore. Then Nair asked him to take over the Goa property. Sharp agreed to do so, gutted the hotel, rebuilt much of it, installed a general manager and trained the staff.
Then, writes Sharp, “We were just about to open when Captain Nair aborted, refusing to move forward with our agreement… I was shocked by this sudden, unexpected turn of events – though we had seen signs that Leela group was then over extended.”
Eventually, Nair ran Goa himself and the Bangalore property opened as a Leela.
Four Seasons then tied up with the Suri family, who owned the Morepen group. But when Morepen’s founder died so did the joint venture.
Next, Four Seasons and Bikki Oberoi began talk of an affiliation, whereby Four Seasons would manage Oberoi Hotels. These talks went on for two years but were inconclusive because both parties felt that their brands should be on top.
Writes Sharp, “Just as we were about to give up hope in India, a Mr Jatia approached us. He and his family owned a very successful Hyatt in Delhi and had talked with Hyatt about another in Bombay. But they thought in all the circumstances a Four Seasons might be a better match for them. We explained the difference between our hotels and the ones they’d been considering and although many changes were required and it would be more costly to build, Mr Jatia decided to make it a Four Seasons.”
The 202 room Bombay Four Seasons opened in May last year and despite some early doubts among the Bombay set has taken off brilliantly. Even in this climate, it charges high rates and manages good occupancies. It boasts India’s finest Chinese restaurant in San Qi and has just opened a high-end Chambers-Belvedere-type club for the rich and well-connected.
Writes Sharp: “Sometimes, thinking back about how and why we first came to India, I can’t make up my mind about Captain Nair’s actions. Had he intended to take advantage of us from the beginning? Or was he prompted by a problem in financing his new hotels? No doubt I should have seen trouble sooner, but I had little experience with him at the time.”
Obviously Captain Nair has a different story to tell and perhaps one day he will tell it.
Sharp is nearing 80 today and the day-to-day management of Four Seasons has passed on to professional managers who run the 82-property chain. But he remains the guiding force of Four Seasons and of the 40-odd properties under development. He has even managed to take over one of the world’s greatest hotels, the George V in Paris and take it to a level of perfection that was previously never dreamt of. The Chinese restaurant at his Hong Kong hotel has three Michelin stars and the accolades keep coming.
Anybody in the hotel business should read his autobiography. It offers a rare insight into how one of the world’s greatest hotel companies was built.