NICKMATUL HUANG: Before you joined Roxy-Pacific, you worked at a couple of other places.
CHRIS TEO: Yeah, I graduated from Michigan State in 1985. My first job was in Mandarin Oriental, at Marina Square. At that time, Marina Square was being built... The whole project was under construction, so I was sent to Bangkok for training. I spent about a year there. Then I came back and joined the pre-opening team. I was also with Amman for a number of years in their early days. I think they had something like one or two hotels when I joined them. The brand was just starting to build itself. It was a big switch from being in a big hotel environment to a small hotel environment. It was a totally different brand proposition, different clientele mix—we were in an unknown market. In those days, nobody knew what a ‘boutique hotel’ was, and we didn’t know if it would work or fail. Today they have 35 or 40 hotels...
NICKMATUL: Why did you decide to move from a big hotel to a small hotel?
CHRIS: There was nothing specific... back then, I thought: okay, let’s just try anything that’s possible, because it’s always a learning experience. You’re mobile, you’re not committed, you’re flexible, so you can pack your bag any time and just go anywhere. I was looking for experience more than, you know, the dollars and cents.
NICKMATUL: So what did you learn?
CHRIS: At the end of the day, it boils down to the most basic thing: staff. The whole hospitality industry is about how you manage your people, building that core group, and training them. That’s the key to why some hotels are successful and some are not so successful. That’s what hospitality is about today. It’s not about systems or technology; that comes with the times. At Grand Mercure Singapore Roxy, we’ve got a good core team that’s been here for years. We just did a long service award where we celebrated 15 years of service, and there are some who’ve been here for 5 to 15 years. I’m very happy and a little bit surprised, but we must be doing something right. In the industry, there’s nowhere and nothing to hide. If you don’t create the right job environment, people are not going to stay with you. It’s a very simplistic way of looking at things, right? But it shows.
NICKMATUL: How do you find talent then?
CHRIS: There’s no specific formula. When you deal with people, it’s about personality and attitude. I don’t think it should be very complicated. The key is being able to have a feel of people, in terms of their personality and attitude. That’s something you can’t put on paper, and comes from knowing people and having a feel of how they would react through real-life contact. I think contact is very important, because that’s how you suss out the right people with the right personality.
NICKMATUL: Noku Kyoto just opened in November 2015, and has already garnered a host of good reviews—especially the service. People were very impressed with how genuine and pleasant the interactions were, even though Japanese people are normally quite reserved.
You have to also empower your staff to make decisions and mistakes because making mistakes is just part of the learning curve, right?
CHRIS: That was one of the fundamental things that we focused on when we set up Noku Kyoto. How do you bring the best out of people? It’s also very important to understand the Japanese service culture. They have a very strong service background in terms of family values and training and history, so they have all the basic things already in place. So when you transfer that to hospitality, how do you make the best use of their strengths? The key for us was to encourage them to be their natural self rather than follow a very structured way of service. We encourage the staff to multitask and have guest contact. We don’t have a strict structure like your job is A, your job is B, or your job is C. We’re there more like guides than organisers… in a very gentle and indirect way. Everybody works together and helps one another as a team. I think this is quite unusual because in Japan, most organisations are very well-organised but very hierarchical, and have a lot of compartmentalisation. You have to also empower your staff to make decisions and mistakes because making mistakes is just part of the learning curve, right?
NICKMATUL: You don’t keep any whips for people who make mistakes?
CHRIS: We give people chances. Everyone makes some mistakes along the way but it’s important to be able to learn from them and receive guidance. So we have a very simple concept when it comes to service. I encourage a high contact level of service. You treat the guest as a guest, literally. What do you do when you’re a host? You make sure that he or she has a good time, and they have all the information they need to have an enjoyable experience. In general, I talk to my staff a lot. Whenever I’m there, I try to find out what some of their problems and difficulties are, and how we can help them. Once we get feedback, we can solve problems and keep moving things along. It’s a small property, so it’s very flexible. There’s a certain advantage in being small: you adapt to situations very quickly. Sometimes size matters and there’s no rocket science to that.
NICKMATUL: Speaking of size, I understand Noku Roxy is the start of a new hotel brand for Roxy-Pacific. How many Nokus do you foresee?
CHRIS: I can’t say. I mean, we’re still a very small entity. We just started, so we are very careful. We try to make sure the products are very stable first before we take the next step. It’s important to get our concepts right. Hotels are very difficult creatures to deal with! You need to spend a lot of time making sure that one works, and that’s something we want to do properly. It will take us at least a couple of years, before we make any moves again. We need the foundation and a core group of people to train, so that takes time. Identifying the right location is another aspect. It took me years to find the right property in Kyoto and Phuket! For me, it’s not about the hotel.
NICKMATUL: You took years to find the right property but it’s not about the hotel?
CHRIS: Destination is the key to travel these days. For example, we picked Kyoto because Kyoto is the cultural centre of Japan. There’s nowhere else in Japan that comes close in that sense. I think most people who travel today generally travel for the experience. The value of the experience is more important, and a hotel facilitates that experience. It’s not like the old days where you talk about linens or aesthetics.
In the case of Japan, it was Kyoto or nothing.
NICKMATUL: Do you mean you choose the destination first when considering where to build a hotel?
CHRIS: We look at the destination first, followed by the accessibility, and whether there is a market for it. The project has to be sustainable from a business point of view. In the case of Japan, it was Kyoto or nothing. Yes, it was a very hard line and my agent had a tough time!
NICKMATUL: I heard that you’ve already announced a second Noku Roxy in Phuket, Thailand, and there is news that you’ve acquired an island in the Maldives! Will that also be part of the brand?
CHRIS: We’re in the process of acquiring the island and that could possibly be another destination. Nothing is confirmed at the moment, but it’s going along that way.
NICKMATUL: What other markets are you looking at?
CHRIS: Established mature markets in Asia. Outside of Asia is a bit difficult for us in terms of management and supervision. We can’t venture into something too strange. That could be the next phase, but we are looking at mature markets that are more stable. You got to play your cards right, and be more conservative about it.
NICKMATUL: In a 2010 interview with one of the directors, it was mentioned that Roxy-Pacific wouldn’t be venturing overseas. But now you have a lot of overseas properties in Japan, Thailand, and the Maldives. What changed?
CHRIS: I can comment a bit more on the hotel part. Our focus is still on Singapore. To be honest, we did try to grow some hotel assets in Singapore, but it was hard. We did put in a couple of bids, but got out-bidded by others. As market value starts to rise, the yield starts to drop; we realised it was getting more and more difficult to run a decent yield out of Singapore, at least for the time being. So we thought we should diversify a little bit into the regional markets to grow the hospitality numbers. We’re looking at assets with constant recurring income because we need to balance out our business. The property market has its ups and downs. It’s the same for the hotel market, but we want to build assets that can provide a good stream of income over the next few years.
NICKMATUL: I understand Noku Kyoto is self-managed, but Grand Mercure Singapore Roxy is managed by AccorHotels. Is your strategy now to self-manage your hotel properties?
CHRIS: It depends on the type of assets or the type of investment that we’re involved in. For products like Noku Kyoto where we are very clear about the concept, we will manage those ourselves. For the size of Grand Mercure Singapore Roxy–we’re talking about large hotels here, about 500-over rooms, so we work with partners. We have a very clear line: we self-manage smaller properities that are our own brands, and have partners for larger-scale properties because distribution is still very essential for big hotels. With big numbers, you need to have the distribution and the management has to fit the property. AccorHotels brings a lot of value and we’re very happy with them.
NICKMATUL: Since you’ve mentioned distribution, what are your views on online travel agents?
CHRIS: They’re like oxygen—you need to breathe but sometimes you get some bad air. I’m kidding! Online travel agents or OTAs as we call them are here to stay. So you have to work with them to the best of your ability. They do offer a lot for small hotels, and are very helpful for independents in terms of reach. It’s incredible—in the old days, maybe 10 or 15 years ago before OTAs existed, if you were a hotel owner, how did you get people to go to your hotel? Without the OTAs, there was so little to help you in terms of marketing. The OTAs and the internet and review blogs and all that have been a huge game changer for many independents. And they are constantly evolving now. They are not just booking engines. They offer feedback and other data from all these different channels, which are helpful in terms of operations and strategy.
NICKMATUL: What do you think of Airbnb and Couchsurfing disrupting the hotel industry?
CHRIS: Airbnb is a different form of accommodation. It’s more like a hostel. And the target market is different from ours. We are more like a conventional hotel. We provide service, facilities and amenities. Airbnb is, in a way, quite basic. It’s more like a self-serve kind of product, although some owners do try to offer more. Personally, I’ve tried Airbnb myself...
Hotel users tend to be more conventional. They like services, and they don’t like unpredictability.
NICKMATUL: And how was it?
CHRIS: It’s not something I would use regularly. They’re targeted more towards young travellers, or people on a budget, or independent travellers who are very tech-savvy. Hotel users tend to be more conventional. They like services, and they don’t like unpredictability. The market is big enough for everybody. There are people who say, "Look, I use Airbnb and I use hotels, depending on where I’m travelling."
NICKMATUL: How do you think the Singapore hospitality landscape differs from the other places you are in—say, Kyoto, Japan, for example?
CHRIS: There are some very big differences! For example, in Singapore today, human resources is a major challenge for hotels, F&B operations, and restaurants. I think a lot of owners or operators have to start thinking differently. We don’t have a choice. We have to play within the rules. I tell my managers that there’s no point for you to keep complaining about it because it’s not going to go away. We got to think out of the box and come up with solutions. There’s a lot of incentive in the market provided by government agencies for recruitment, training, and staff development. Besides training, staff retention is a big key. Apart from the obvious bits like salary, the work environment is very important, and the way staff is treated. There are a lot of things we need to work on. First and foremost, we need to get back to basics: how do we get people into the industry, especially locals? In Japan, one of the biggest challenges we have today is getting bilingual staff. In Japan, tourism has exploded. It’s grown very fast and everyone is having problems keeping up with the growth on the HR side. I think it will slowly get there but it will take some time. So we try to take a softer approach: for the general rank-and-file, we hire younger staff with lesser skill sets or even without any experience and start them fresh. We do have experienced accountants and managers but for staff like receptionists, they are quite young. That being said, they are enthusiastic, more flexible in their thinking and are willing to go out of their way, which is an advantage. We are in different markets now, so we do have to think differently...
NICKMATUL: Finally, how do you keep everything in check?
CHRIS: You just have to get involved! I enjoy doing that. I’m always here [Grand Mercure Singapore Roxy] talking to my staff, and even the GM—communication is very important. I go to Japan regularly, too. I'm hands-on with everything.
Edited by Wy-Lene Yap