Hyatt CEO on why ‘ignorance is a superpower’

ATLANTA — Hyatt Hotel Corp.’s Mark Hoplamazian identified his three biggest lessons learned in his time as CEO of the company: listen carefully and completely; ignorance can actually be a superpower; and authenticity isn’t something you can learn.

Hoplamazian, who was interviewed by Greg Friedman, managing principal and CEO of Atlanta-based Peachtree Group, on the second day of the Hunter hotel conference in Atlanta, said all three have come in handy in his almost 19 years as CEO of Hyatt Hotels.

When asked to elaborate on the three, he first talked about how he’s learned to listen. “[I] listen to understand, not to respond,” he said. “You have to make sure you’re not listening and formulating a response at the same time. Listen carefully and really understand what’s being said.”

Regarding the “ignorance is a superpower” rule, Hoplamazian discussed how he became CEO of Hyatt without any hotel experience. “I was very honest about the fact that I didn’t know anything about the business. People were very skeptical,” he said.

He said he learned a lot from many mentors, many of whom are currently CEOs of competing hotel companies.

When asked to elaborate on authenticity, he mentioned an expression by his late mother-in-law that you can tell a person’s quality by how they treat the elevator operator. In other words, treating people above and below them the same can speak a lot to their character.

Never 100% asset light

Hoplamazian spoke on several hotel-related topics, including Hyatt’s continued asset-light strategy, which was emphasized during the last few earnings calls.

I’ve never, ever, and I’ll repeat it now, I’ve never said that we’re going to be 100% asset light. It doesn’t exist in our industry.

Mark Hoplamazian

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“I fought with Wall Street and others for many years about holding so much real estate,” he said. “Every one of our competitors used to own a whole bunch of real estate because that’s part of the business... Being an owner is really important and owning and developing real estate is an important part of the business. So, if you’re not engaged in that and don’t consider it to be something that you’re prepared to roll up your sleeves and deeply understand, by way of owning and operating, I’m not sure you’re covering the waterfront that you need to.”

Hoplamazian said he doesn’t envision a time when Hyatt doesn’t own any real estate.

“We have gone down the path of selling a bunch of real estate, but we haven’t sold all of it,” he said. “I’ve never, ever, and I’ll repeat it now, I’ve never said that we’re going to be 100% asset light. It doesn’t exist in our industry.”

Being nimble

Hoplamazian also spoke to the importance of being nimble and used the lessons learned during COVID to explain how Hyatt is improving. It’s also coming in handy during the chaotic times of this new presidential administration.

[Those people] are out there running hotels, day in and day out and, by the way, they’re kind of right. Corporate offices get really slow and bureaucratic, which drives me out of my mind.

Mark Hoplamazian

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“We are going through a disruptive time right now. People ask me, what kind of scenario planning have you done? I said zero. Scenario planning assumes that you have a scenario in mind that has a higher likelihood of coming true,” he said. “I don’t know what’s happened in the last hour and a half since I last checked, but things are changing by the minute. So, you have to be nimble.”

One of the biggest lessons that Hyatt has learned in the past few years is the best ideas don’t necessarily have to come out of their headquarters, Hoplamazian said. 

“The people who were coming up with great ideas to make operations dramatically more efficient were not sitting in Chicago… They were in hotels and figuring it out,” he said.

That has unlocked a lot of creative activity in the company, which has yielded a huge business impact, according to Hoplamazian.

“I said we want to pull that [creativity] across the whole company. We don’t just want to run hotels that way; I want to run finance that way. I want to run legal that way. I want to run development that way,” he said. “I want to run everything in a magical way, where you have quick-cycle testing and learning experimentation. You make changes really quickly. You encourage failure, meaning you keep experimenting and keep going.”

The mantra, Hoplamazian said, is “just try it.”

“What’s the worst that can happen?” he said. “If it works, great, we’ll keep going. If it doesn’t, we’ll pivot and figure something else out. Having that capability to be nimble, pivot, and keep moving quickly is the way to be resilient as an organization.”

Hoplamazian said he tries to think of what his hotel employees are thinking.

“I think this is true for a lot of large brand companies. People in the field [say], ‘Can you believe how stupid and inefficient the corporate office is?’” he said. “[Those people] are out there running hotels, day in and day out and, by the way, they’re kind of right. Corporate offices get really slow and bureaucratic, which drives me out of my mind.”