The Six Core Competencies You Want in a Corporate Housing Provider
Serviced accommodations (i.e., corporate apartments or serviced apartments), are experiencing a quintessential defining moment. The type of moment history will mark with a highlighter as the period when everything changed.
The, “why did it all change?” question will be answered with, “remember, COVID-19?” and most will react with mutual comprehension as memories flood back with a linear, two-dimensional narrative of the past. And the scapegoat will be born.
The strategies, heroic sales efforts, and agile product positioning—battles waged, and wars won by those who survived—will long be forgotten.
Survival will be inspiring, but even more impressive will be the examples of those organizations that not only survived the war but doubled down on their mission and came out ahead.
Crystal balls are tough to come by these days, but as retired United States General and former United States Secretary of State, James Mattis said, “[while] history is not a straitjacket, I’ve never found a better guide for the way ahead than studying the histories.”
So, let’s not try to predict the future, but rather, let’s lean on Synergy’s two decades of experience, and define the six traits we believe to be the bedrock of a solvent, stable serviced accommodation provider.
Through an analysis of these traits, we hope corporations in the market for travel and mobility services can begin to understand the service providers and operators in our space built like a firework (big flashy entrance only to fizzle and die out once funding dries up) and those organizations built to last.
First and foremost, financial strength. Without it, serviced accommodation providers lack the endurance to survive disruption. Whether the disruption is in the form of economic, technological, or regulatory, financial strength provides an organization with the necessary flexibility to handle abrupt changes to revenue, client acquisition, and pricing power.
The “runway” analogy is appropriate here. Depending on the size of your corporation, you want to match your travel and mobility needs with the appropriate sized financial runway required to handle the accelerating and decelerating travel and mobility actions of your organization.
Is your workforce expanding? If so, can your provider match your expanding needs without taxing their workforce or infrastructure? Alternatively, are you forecasting a contraction in your organization’s need for travel and mobility services? Will this contraction affect your pricing as your provider struggles to manage their economies of scale to counter the decrease in revenue?
The Ascott Limited (Ascott), one of the leading international lodging owner-operators with a portfolio spanning more than 180 cities across 30+ countries in the Asia Pacific, Central Asia, Europe, the Middle East, Africa, and the USA
For example, due to Synergy’s strong financial backing from its parent, The Ascott Limited (Ascott) and its parent, CapitaLand, in 2017 Synergy worked with three RMCs to take over the leases from multiple bankrupt temporary housing companies, so their transferees wouldn’t get locked out of their apartments for non-payments. This was made possible by Synergy’s strong financial health and backing.
CapitaLand, one of Asia’s largest diversified real estate groups, owning and managing a global portfolio worth S$131.9 billion (as of 31 December 2019)
Financial strength is so much more than money in the bank or the backing of a Hedge-Fund or VC. An organization must be able to show sound financial practices, healthy balance sheets, and cash reserves with the backing and security of readily available investment capital. When an organization’s burn rate needs a handicap and growth is measured in terms of units acquired as opposed to paying clients, it’s only a matter of time before that perilous Jenga block is pulled and the tower comes crashing down.
Financial strength is the greatest backstop to disruption.
While financial strength is key to the health of a provider, strong relationships moored to a partnership mentality are fundamental to the execution of overall service delivery, and therefore business strategy.
“It takes a village” is an apropos statement in the serviced accommodation sector. With so many intertwined services and unique needs, managing a local, regional, or global travel and mobility program takes the support and expertise of thousands of providers interacting seamlessly on multiple interlocking layers. To be competitive let alone successful, serviced accommodations providers must have strong supplier relationships with adequate breadth and depth of coverage. The former factor leads to economies of scale while the latter leads to product and service consistency.
For example, Synergy believes in a supplier partnership philosophy. Meaning, we don’t source suppliers, we develop them. The goal of this effort is a dense, overlapping, robust network of suppliers capable of handling large (200+ ppl) international temporary assignments, or the nuanced needs of an engineer on a 30-day assignment venturing deep into remote Norway.
We believe the common commodity model of distributing housing requests to a pool of vendors puts too much pressure on price and doesn’t allow for the flexibility needed to tailor offerings to individual client requirements. In order to keep the margin viable, this pressure inevitably drives down product quality as each vendor races to the bottom to capture the business. This chain reaction leads to a compromised product and service quality. An effect especially true in times of low demand. Overall, a commodity supplier model compromises the guest experience, which could leave lasting impressions on employee loyalty and productivity—a fact corporations cannot afford to grapple with when competing for talent.
In a partner-centric environment, providers such as Synergy, create close-knit working relationships with companies that adhere to the same cultural values and passion for service. This alignment of core philosophy enables providers and partners the environment to work in a collaborative manner, both closely vested in the delivery of services.
Supplier relationships are the greatest predictor of service delivery capability.
As noted in the previous section, relationships moored to a partnership mentality are fundamental to the execution of overall service delivery. However, service delivery, i.e., the organizational model to which service and product stem, is the foundation which gives that execution (emphasized above), the leverage it needs to be impactful.
That said, the service delivery style of each serviced accommodation operator is unique. Some focus on a suite of technology tools with little to no human interaction, others focus solely on specific regions, while others deliver products and services exclusively via suppliers. Although you can make an argument for each service delivery model per a set of different contextual lens, the one built for the future is focused on one element, the client (and as a byproduct, the employee, i.e., guest).
What does a multi-national organization need from a service delivery model? A multi-model approach to service delivery.
To achieve this, operators must have a comprehensive inventory strategy backed by a local presence (that spans the globe), vetted supplier partnerships, and the know-how to serve unique needs with left-of-center, out of the box thinking and resources.
For example, Synergy offers both owned and exclusively managed properties along with a vast network of properties via service accommodation providers, one the largest combined network of properties of its kind (110K+ units; 160K by 2023). This multi-model approach to service delivery enables a serviced accommodation solution for most any need whether it be interns, relocating families, consultants on assignment, or senior-level executives. Furthermore, our multi-model service delivery complements our tri-regional structure (divisional offices in SF Bay Area (the Americas), Dublin (EMEA), and Singapore, APAC), account coverage, and support. It is through this robust service delivery platform we are able to offer global billing services with multi-currency options suited to the needs of our clients. Of note, we were one of the first serviced accommodations providers to generate and offer Fapiao invoices, China’s invoice system.
Synergy is on a mission to redefine the hospitality ecosystem by providing our clients with housing options best-suited to their needs from a portfolio of branded offerings tailored to specific property classes, amenity offerings, and price points. Our multi-model service delivery and tri-regional structure are critical to that mission.
A robust service delivery model is indicative of a resilient operator.
Hospitality is a catch-all term. It means many different things to many different people. For instance, “hospitable service.” Is that aspirational, or a benchmark?
If you ask ten people, nine out of ten will say “hospitable service” feels flat and hallow. But, you can’t say hospitable service isn’t hospitality. Because it is.
And therein lies the beauty of hospitality. It’s an art, and like art, its beauty lies in the eye of the beholder.
But make no mistake about it, hospitable service isn’t going to win the future of the service accommodation industry. Operators must level up. Operators must remember the serviced accommodation industry is a people business. Operators must embrace the variable that is humanity, ditch the playbook, lean into instinct, and leap.
What does this look like?
Synergy recently onboarded one of the largest video game developers in the world. A massive undertaking in its own right, but given the hospitality dial was cranked to eleven, this particular “welcome home” experience was very special. From the very first meeting with the client, Synergy aimed to dream big. To create an immersive experience that not only bridged the gap between the client’s culture and its serviced accommodations but built on top of it. The goal was never the status quo. Never was it to meet in the middle. The goal was big, sweeping brushes of imaginative genius.
The accumulation of this effort wasn’t just a housing experience welcoming the guest upon arrival with a meet and greet, a first week’s food package, and a soft-as-hell, make you wanna cuddle bathrobe—no, that’s just hospitable service. What Synergy did was hospitality. We painted a mosaic of our client’s internal culture all over their units breathing life into each unit and truly create a melding of culture with the tenants of “home.”
You can train to another’s hospitality benchmark, but by that time, it’s just hospitable service. You can’t code hospitality into a system or database. Hospitality starts with the people, comes alive in the culture of the provider, and turns into art via the passion the individual hospitality artist has for the guest experience. Up and down the organizational ladder, Synergy employs hospitality artists.
Hospitality is the greatest forecast mechanism into to the quality of the guest experience.
Life is all about balance. If hospitality is on one side of the scale, technology and automation are on the other. That said, not all technology is created equal. Ask anyone performing data entry eight hours a day and they will gladly spend an entire happy-hour explaining the magic of Excel formulas. Or if you found someone in a coma for the last 25 years, they will probably marvel at electronic mail.
Disruptive technology—referring to any technology usurping a current system, manual or not, and making it quicker, more efficient, more reliable, and enduring—has officially reached the serviced accommodation industry.
Companies are finding ways to deliver property options from a vast network of suppliers from around the globe in a matter of hours. It isn’t too farfetched to envision this timeframe wildling down to minutes before it becomes instantaneous.
Try to contemplate a world where centralized databases, APIs, and polished front-end marketplaces didn’t exist. It is nearly impossible.
Technology makes automation work, and with automation, productivity levels sky-rocket making products and services available to the masses 24 hours a day, 7 days a week, 365 days of the year. This is now table stakes in the serviced accommodation industry.
Providers of the future are not only creating seamless booking experiences via an online marketplace, but they are also finding ways to integrate auxiliary tasks into the automation workflow creating synergies (pun intended!) far beyond the expectation. They are developing systems to tie data sets together and run those sets against coded intelligence taking on not only manual tasks but venturing into the world of complex systems management.
For example, Synergy developed a proprietary technology system that saved days of work for a massive Silicon Valley tech-client. All in all, the new workflow not only provided efficiencies, but it also delivered a more reliable end product and ultimately enhanced the guest experience. Fundamentally, we took client and guest data, integrated it with our centralized management database, built proprietary code to filter and then rematch hundreds of data sets, and byways of technological power, Synergy built a new system that saved time, resources, and money, delivering a better more efficient end result—all tied to the overall pre-existing tech stack.
Technology is so much more than a pretty website. It is instant online booking capabilities tied to a robust multi-dimensional marketplace inextricably linked to every step of the guest experience (e.g., video-assisted arrival experiences, hot food delivered five minutes post-arrival, remote climate control and neighborhood guides powered via a smartphone app, etc.) fortifying the relationship between guest and host. The act of stacking all available data to a fluid framework of systems seamlessly interacting with each other based on a set of programmable rules will exponentially breed client and guest loyalty.
That is not to say, the tech stack replaces hospitality. It merely frees up human ingenuity to do what it does best—anticipate needs—while allowing technology to do what it does best—record, process, and automate.
The health of the tech stack directly correlates to the longevity of the operator.
Nestled behind the mask of technology lives one of the most powerful tools a service accommodations provider can deploy. Data analytics and reporting form the basis for a suite of business solutions aimed at offering clients (and guests for that matter) a look under the hood at the inner workings of their travel and mobility programs.
Where guests are booking… How often they are booking a certain property… How close that property is to the corporation’s physical address… How many total nights, average daily rates (ADR), total spend forecasts, total savings by region, and so much more. If the information, i.e. data is inputted into a system, then theoretically it can be tracked, grouped, and repackaged to tell a retroactive complete story of your program. A story easily analyzed for future trends and measurement against key performance indicators (KPIs).
For example, Synergy takes an active role in guiding critical program decisions through the usage of predictive analytics, market expertise, and acting on KPIs shared on a consistent basis via quarterly and annual business reviews. Proactive business solutions are discussed in conjunction with the data sets to foster a collaborative environment that promotes transparency and an honest assessment of travel and mobility housing programs. Often these business reviews lead to pivotal changes that spark costs savings, program adoption, and program loyalty.
Of particular note, Synergy entered into a strategic partnership with a technology provider to create a platform that dramatically reduces employee (i.e., guest) touchpoints. A planned pilot is underway in Cork, Ireland. Features of the new system include:
- This direct connection results in fewer touchpoints for a more efficient process
- A reduced chance of available properties being lost due to communication inefficiencies/delays
- The employee can see live apartment inventory
- Each employee is guided by a local host familiar with temporary and permanent housing
- Due to the fact the employee has the choice, the optimal neighborhood is chosen, so there is no need to settle into a neighborhood twice (that is worth repeating… there is no need to settle into a neighborhood twice for a relocating employee!) when the employee moves to a permanent residence
Business solutions fueled by data intelligence and forecasting will reshape the serviced accommodation industry from the inside out. Operators must act fast to get their data house in order, or they will be left out of the inside joke being told at their expense.
It is important to highlight, while data is the star of this story, market expertise plays a vital supporting role. Not only that, but it also takes human ingenuity to put data into action (at least at this stage of our technological curve). Without the human element, you are like a ship without a compass two miles off the coast. To the ship captain, they might as well be in the middle of the ocean. Market expertise is your data compass.
Business solutions offer the best guardrails to the viability of a travel and mobility program.
A Company You Can Count On
Dealing with change is tough. It is a process that takes time.
There’s the loss. The unknowns. The “what ifs” and “if onlys.” The mental friction of work ahead. The fatigue of the learning curve.
Then possibility begins to take shape. Change sheds its skin to reveal what is really happening. Evolution.
If you made it this far in the article, you’ve realized you are capable of adapting.
The serviced accommodations industry has changed. Not only has the novel coronavirus hastened the exit and downsize of numerous providers and operators, but it has shaken the very fabric of our global economy.
Tomorrow is uncertain. Yet amongst that uncertainty, important decisions still need to be made. Decisions that will play a critical role in the future viability of your travel and mobility program.
Now more than ever, it is important to choose a provider with the financial strength to weather the fierce economic winds ahead. A provider with true global reach and multiple models of service delivery, anchored to rock-solid supplier partnerships. One with respect for technology and automation balanced by a belief in the human touch of hospitality. All supported by made to order, intelligent business solutions.
Change is never easy unless you find the right partner. The noted six areas of competency stand as the bedrock of stability in an unstable world. The bedrock we built Synergy Global Housing upon.
Join us and we promise to get you on solid ground and dreaming about the future in no time.
Fantastic article – Really well written – enjoyed the read. Thanks
What a great article. Synergy is and always was a leader and now more than ever they are bringing their “A” game to the table.
I had no idea that hospitality means different things to different people. The best way to handle that would be to make a place as accommodating as possible. If that means putting extra money into it then that is worth it.