How Maslow Saved a Hotel Chain

Boutique hotelier Chip Conley has written a book that captures the ethos of what we call The Age of Transcendence in our own book, Firms of Endearment. Conley’s book is Peak: How Great Companies Get Their Mojo from Maslow.

Conley founded the Joie de Vivre hotel brand in the 1980s, in San Francisco. His business plan called for catering to niches that do not typically show up on the radar screens of legacy names like Marriott. For example Conley’s first hotel, The Phoenix, is a funky establishment that caters to artists, friends of artists and sundry others inclined to travel away from the mainstreams of society.

Getting all the way down to a “niche of one,” the Joie de Vivre web site invites you to answer five questions. Yvette will then match you up with a Joie de Vivre hotel that best fits your personality. This honors Conley’s intention that a Joie de Vivre hotel experience delivers “identity refreshment” to each guest that validates him or her as a distinct individual.

Peak recalls the darkest days in the hotel industry since the Great Depression that occurred in the wake of the dotcom collapse and the horrific events of 9/11. Occupancy rates plunged to 50 percent in Joie de Vivre’s markets. Some competitors filed for bankruptcy, including hotels operated by the biggest names in the business. But Joie de Vivre hotels averaged about a 20 percent annual market share pickup before the hospitality business returned to normal.

Abraham Maslow is the hero in Conley’s story. As improbable as it may seem to some, he attributes the success of the Joie de Vivre brand to the creative application of the ideas of Maslow. Conley's heaviest Maslovian focus is on promoting the self-actualization of employees, customers and investors.

Maslow defined self-actualization in its simplest terms as “being all you can be.” Once in the zone of “being all you can be,” a person has a frequency of “peak experiences” not available to those yet to reach the lofty maturational levels of self-actualization.

People who still toil away to meet basic survival needs or who are still preoccupied with achieving greater social, vocational and material success have only occasional peak experiences.   

In describing his Maslovian-grounded recipe for saving and growing his company, Conley writes, “I came to realize that creating peak experiences for our employees, customers and investors fostered peak performance for my company.”

Peak shows why Maslovian-grounded management is not a New Age inspired approach to running a company. Rather, it is an eminently practical style of management that can produce superior results. It promotes peak performance throughout an organization at less net cost per employee than a more traditional style of management could achieve.

Take marketing costs, for example. With over $200 million in sales annually, Joie de Vivre spends less than $50,000 a year in print advertising.

Other benefits of the Joie de Vivre style of management include lower employee turnover, higher employee productivity and the deeper customer satisfaction and loyalty that inevitably flows from highly motivated, committed and satisfied employees.

Joie de Vivre is a quintessential "firm of endearment" – FoE. It follows the multiple-stakeholder operating model that is fundamental to the FoE way. Joie de Vivre is operationally organized as a network of teams rather than as a hierarchy based on title and function.. Like many FoE brands, Joie de Vivre hotels achieve virtual cult status in the eyes of many customers. That is the biggest reason FoEs typically have significantly lower marketing costs than their competitors have.

In the course of extending his points beyond the Joie de Vivre story, Conley cites other companies whose management reflects a Maslovian orientation. These include Whole Foods, Starbucks, Progressive Insurance, Harley-Davidson, Google and Best Buy – all of whom are FoEs that we hold up in Firms of Endearment as exemplary followers of the multiple stakeholder business operations model.

Conley has performed a great service by showing everyone including competitors how he steered his company through times of nearly unprecedented challenges and built it into the second largest chain of boutique hotels in the world.

Peak is a book for the times. It poignantly demonstrates the others-centered bent of a new breed of CEOs who have rejected the traditional ways outlined in Jim Collins’ monumental best seller, Good to Great and set out to build great companies through a more humanistic style of management.

Comments

[Kare Anderson]

Enlightening review of abook I'be ejoue and a local hero here many of us admire

Those who flourish in this flattening world dedicated to "the power of us" will, like Chip, hone their skills on bringing out the higher-performing and happier side in others.

Their humanistic structure may include a M. Buckingham system of recognizing strengths, so people get jobs where they get to use those strengths much of the time (optimize organization).

Saavy firms will get clear and specific about how everyone's job fits in the overall scheme of things towards the main goal/brand/belief of the organization.

With small teams within a larger group (as Rick Warren and many others have discovered) people can benefit form camaraderie and team work.

All that is needed then is learning the specific ways we can speak sooner to the sweet spot of mutual interest so people can actually get mroe done together than apart.

Finally, each g

[Hotel web design]

People who still toil away to meet basic survival needs or who are still preoccupied with achieving greater social, vocational and material success have only occasional peak experiences.

[hotel online marketing]

Hi,
Nice post.Saavy firms will get clear and specific about how everyone's job fits in the overall scheme of things towards the main goal/brand/belief of the organization..