AccorHotels CDO on the importance of cultural transformation

This is the latest in a series of articles spun out of tnoozLIVE@ITB, recorded live over three days at ITB Berlin this March. More clips and interviews to come here, as well as on our YouTube channel.

Maud Bailly's appointment last year as the first ever chief digital officer for AccorHotels came a few months before the group's 50th anniversary.

It doesn't take an economic historian to work out that AccorHotels was established before technology became part of the business world vernacular, and one recurring theme in the conversations around digital transformation is the specific challenges faced by businesses which existed before the internet.

This was one of the questions we asked Maud when she sat down with tnooz at ITB Berlin. She recognised that changing the corporate mindset was a vital component of her digital transformation aspirations.

OTAs

The disruption of the hospitality industry has as many manifestations, and Bailly's brief as CDO covers most of them - "IT, data, ecommerce, guest experience but also sales and distribution". The latter inevitably covers the relationship with OTAs, and Bailly insisted that OTAs "are not [AccorHotels'] enemy."

The strategy of working with OTAs does not preclude having a strong direct business, with Bailly referencing the importance of using all available channels to maximise the profitability for the owners of the properties.  At the risk of oversimplifying  a $4.4 billion real estate deal, many of the hotels run by AccorHotels are now owned by AccorInvest.

The term used is "asset-light" and AccorHotels distribution strategy is framed by its role as "the commercial business partner and service provider for the hotels."

In the "OTA versus brand dotcom" context, Bailly explained:

Diversity

As well as talking to OTAs, while keeping an eye on IT, data, ecommerce, guest experience, sales and distribution, at the same time as educating staff across the group about the digital dynamics of hospitality, Bailly also manages to find time to be an ambassador for the Women at AccorHotels Generation, which launched in 20012 and is one of the many diversity initiatives run by the group.

Watch the full video for Maud Bailly’s take on cultural transformation, AccorHotels' relationship with OTAs and the importance of diversity, among other things.

 Martin: I'm here with Maud Bailly, chief digital officer for AccorHotels. You took over the role less than a year ago and were new to travel. How are you finding it?

Maud: Thank you for welcoming me. I joined AccorHotels last April. So, it's going to be almost a year. As its CDO, I'm in charge of IT, data, ecommerce, guest experience but also sales and distribution.

Is that all?

Yes, and it's enough! It's a very wide scope but actually, it's a key scope for the business because we are, especially now in an asset-light environment, the commercial business partner and service provider for the hotels.

So, my mission, I would define it as inventing and defining the best tools to make sure that first, we maximize the net profitability and the efficiency of our hotels, and second, fully increase the satisfaction level of our guests.

So, digital is just a means, never an end.

It's almost two constituents. You have using digital to enhance the guest experience, then using digital to enhance the profitability. Is there any sort of correlation between how satisfied the guests are on property and the rate that they're willing to pay. How do these two connect?

Actually, price matters for sure. When you observe the behaviours of our customer online, price is going to be one of the main criteria in their decision of a booking but is not only that. We have to be competitive on prize but we have also to be attractive on our global promise. So, as you know, AccorHotels used to be very mid-scale. It has been completely changed for the past three years by acquisitions like Fairmont Raffles Suites Hotel in the luxury segment, the Orient Express joint venture or new hospitality brands like Banyan Tree, Rixos.

So, we are really trying also to attract and retain our customers, not only by price but also thanks to enriched offer and this offer is constantly enriched. Three years ago, we had 12 hospitality brands. Now, we're having 25 and it's not going to stop.

Some hotel chains are almost morphing into less brands but you think that there's room to have more brands. Does each have a separate digital strategy?

Hopefully not, because it will cost so much and we have to guarantee a minimum level of consistency especially in IT level because it's all about deployment at scale of our IT solution and also consistency in the guest experience.

No matter if you stay in an Ibis Budget or Raffles or Novotel or Sofitel or Rixos or Banyan Tree, we want to guarantee the same quality of customer experience and therefore, we have to develop at scale the same digital tools and services.

Maybe I could have asked you earlier about what it was like to join a company that's not necessarily tech-enabled. I mean, we talk on tnooz a lot about legacy, that's legacy systems and legacy mindset. So, how have you, as the chief digital officer, addressed what might be seen as more of a non-digitally native business?

To me, you're raising one of the most important points actually of my job. We have just been celebrating the 50th anniversary of AccorHotels last November. So, for sure, obviously, we are a non-digital native company. Paradoxically, AccorHotels in the hospitality industry, one of the most disrupted sectors. So, the challenge of my mission is to really help the people to understand what is happening, what is at stake with digital transformation, and how we can help a very traditional industry to adapt itself very fast, to move fast, to face some dramatic changes through digital era.

So, my role is a lot about education, sharing, explaining why for instance you need to buy online somewhere else to increase your online visibility, what is metasearch, why we need to see more and more to the customers' new behaviours like voice search, tomorrow it will be conversational chatbot, artificial intelligence.

I could tell you about data lake, very IT technical stuff, but there is also a huge challenge about cultural transformation and helping the whole organization to get fully aware of what's happening in a fully digitalized industry.

We've covered digital transformation on tnooz quite extensively and quite a lot of the issues around digital transformation is the cultural transformation that has to happen before the digital transformation can take place

Exactly, and to me, you can't launch an effective technical, technological, digital transformation if you're not a the same time, launching a cultural and managerial transformation. It's not going to work. It's always about people, new mindset, new ways of working. You can't pretend to become more digital if you are still a very hierarchical, vertical organization. You have to launch future teams with agility. It's not just a word, it's a way of working. So, this is also what makes the job really interesting, to be honest.

One of the things that makes my job really interesting, particularly when I've got the chief digital officer of one of the biggest hotel chains in the world sat next to me, is the direct versus indirect argument. What's AccorHotels top line take on the relationship with OTAs and brand.com?

I'm often asked this question and I understand because our environment in the hospitality industry has been changed so fast that for sure, we have to work with OTAs. In AccorHotels, we don't consider OTAs our enemies. They are key partners, pure players, and in our very digitalized environment, we have to play with them and we have to work with them.

Yesterday, I spent the day with many OTAs. We're negotiating shared interest, working together, and it's more about maximizing our interest and our value proposition together. Our strategy in AccorHotels is to improve the quality of our direct channel, mobile applications, fluidity and stickiness of our website,  contact center quality, making sure that when you book on AccorHotels.com, it's fast, inspirational, efficient, and people want to come back. We have to really work on it but at the same time, we are quite omnichannel in our approach.

My concern is to use each channel which is available to maximize my profitability and the satisfaction of my clients. So, it's not really direct versus indirect. It's just playing with everything you've got and making sure that at the end of the day, because I've got another client, not only customers staying in the hotel, but also the hotels, the owners, and I want to make sure that those people are happy because they know that, thanks to AccorHotels, I'm maximizing also their business.

Today is International Women's Day. I'm not sure to what extent tnooz has contributed to that because you might be only the second female senior exec that we've talked to! What do you think about the diversity in the travel sector?

Diversity to me has always been a key element in management and leadership. Why? Because in my career, the most efficient and the best performing teams I have ever had were really diverse teams, i.e., junior and seniors, national but also international backgrounds, men and women.

So, I have the opportunity to be also as the ambassador of the WAAG. It's a network in AccorHotels - Women at AccorHotels' generation.  It's about women's promotion but also about diversity as a powerful level of collective intelligence, and I really think that us as a leaders have really to encourage diversity each time we can because it is a true level of performance, and the more different we are, the better performance we have. The way you look at a problem is with your own glasses, different to mine. So, I'm going to be enriched by your point of view which is not necessarily going to be mine. The most agile and brilliant organizations rely on diversity. So, I'm extremely committed to diversity in Accor.

How do you think the travel industry compares with other verticals in terms of the diversity?

On different international backgrounds, we are very rich and very advanced. When I joined AccorHotels, I was struck and very happy to meet so many different people with different origins, different backgrounds. Sometimes we are working with more than 20 nationalities in the same department. It's a real richness and I love it because we are also an international worldwide company.

At the same time, I think that men and women improvements are here and we have the responsibility and the duty to make sure that women's day is not only on the 8th of March.

NOTE - the transcript has been edited for brevity and clarity

tnoozLIVE@ITB was presented by Travelaer, with further support from eNett, MMGY Global, and Cendyn

To learn more about how to bring tnoozLIVE@ to your event, please email Ella Sopp.