The business of hospitality

Rick Gaede’s day starts before the crack of dawn.

By 8 a.m., he’s already completed an extensive exercise routine and strolled the floors of the company to make sure things are ship-shape, and is eagerly awaiting his regular morning executive staff meeting.

Gaede is general manager of the Renaissance Cleveland Hotel, a post he’s held since last October. With 491 rooms, more than 600 employees and events scheduled year-round, he isn’t your average business leader.

Gaede’s world is in constant motion. His product is the hotel and its services. The market is every man, woman or child who walks through the door. But that’s just the way he likes it. Gaede, who came to Cleveland from Atlanta’s Renaissance Waverly Hotel, sat down with SBN at the Renaissance’s Sans Souci to discuss how managing a hotel is akin to running a large division of a multinational company — in this case, Marriott Corp.

The Renaissance seems to be a hotel in great financial shape. How do you plan to improve upon it?

There’s a strong foundation, so we’re looking at a soft goods renovation. Marriott has committed $5 million for this year and between $2 million and $4 million for next year. We’re going to upgrade carpeting, wallpaper, drapes and mattresses in the guest rooms and do some facelifts in the bathrooms.

Basically, we’re just going to put a dress on it because you’ve got to keep an eye on what this hotel is all about. We don’t want to do anything drastic.

How is the job of a hotel general manager similar to that of a division manager?

The GM is responsible for the overall operation of the hotel. I have to make sure the guests and associates are satisfied and keep the product in the best possible shape. I also get involved with the public — currently I serve on the board of directors of the Conventions and Visitors Bureau — and work with charitable organizations within the community.

GMs oversee purchasing, the menus, room changes and sales and marketing. I also have to make sure the numbers match. You have to roll up your sleeves in this job. I’ve loaded meals on the banquet assembly line, made beds and bartended. It allows you to understand the challenges your employees have and you can lend your expertise when they need it.

How does the Cleveland Renaissance’s 491 rooms compare with other hotels in the chain as well as with local competitors?

Many in the chain are actually smaller because the Renaissance as a brand is a more boutiquish hotel. Each has its individual character — Cleveland’s is part of the historic hotel register. The only common factor among them is service.

Our closest competitor is the Sheraton. As far as the combination of hotel and meeting space, no one is close. Our ballroom used to be the biggest between New York and Chicago. It still could be. We also have a large staff, about 620 employees, and all but 75 are full time.

Explain the importance of occupancy rates and average room rate revenue.

The rates in Cleveland are in the $140-plus range as an average per room. Year-round, we have a 72 to 78 percent occupancy rate. This year, we’re approaching $149 per room for a year-round average. And if the demand continues, we can drive that number up. It all depends on the future expansion of the convention center.

We’re running above average in terms of the industry. Nationally, we run well in our segment in the luxury tier. To keep this up, you have to be aggressive in marketing efforts. Right now, 70 to 72 percent of the hotel occupancy is group hotel sales; the rest are transient.

Group business is made up of large groups that come into town and fill 300 to 350 rooms for several nights. Transient sales are typical business travelers that come in for a night or two. You have to balance them evenly — 70/30 is a good balance for us.

How is your success judged?

Sales and profit. We also run associate opinion surveys once each year and internal meeting planning surveys. Anyone who has a meeting here is sent a survey by Marriott to judge the experience.

There is also a guest satisfaction survey that’s randomly sent out to 800 guests each month, 13 periods a year, every 28 days. It’s a great barometer to see how you’re doing.

Describe a typical workday.

I get up at 4 a.m. and work out in my room — I live in the hotel. Then, I go down to the exercise room and run five miles on the treadmill and lift weights. I get into the office around 6:30 a.m. and routinely walk around the hotel early in the morning to see what’s going on.

At 8 a.m. we have a business review — I sit down with sales managers and talk about the business they’re working on. We talk about how to make the numbers work. Then there’s a half-hour meeting with the executive committee where we review the previous day. The rest of the morning I spend on phone calls, in smaller meetings and at lunches.

In the afternoon, I run various staff meetings and business meetings. By late afternoon, I hope to answer the 20 to 30 e-mails I get each day.

What’s the most enjoyable part of the job?

Riding down the elevator with a guest. You ask them about their stay and they tell you how great it was. I make it a habit to ride the elevator several times each day. They love the fact that ”the guy” comes around and says hi to them.

What about attraction and retention? Isn’t hospitality a high-turnover industry?

The brand attracts retention. There are over 2,000 Marriott properties and more than 100 Renaissance hotels. As a brand, retention level is high among management. As for associates, it’s harder at the lower levels. You treat them with respect and give good benefits packages with fair wages.

We do an extensive two-day orientation to go over benefits — 401(k) and profit sharing — along with the details of the hotel, business and worldwide operations. That really helps in retention.

How to reach: Renaissance Hotel, (216) 902-4001