Home' micenet eMag : micenet December 2018 Contents friends keeps him in check.
“I now have my family here and I do have
what a lot of hoteliers don’t – I work Monday
to Friday in a day time job, and while the
hours can be long you have your weekends
“My job is an interesting one and this is a
very unique project,” he says proudly.
The Four Points way
For Bernhard Langer, the opening of his
hotel, the Four Points by Sheraton Sydney,
Central Park on August 8 this year, was his
fourth pre-opening and his first as general
manager. All of which he described as being
A critical foundation to any preopening Mr
Langer explains, is to establish a pre-opening
budget (POB) alongside market research, a
hotel positioning statement and the
development of sales and marketing and
digital marketing strategies for each market
“It’s also important to get the pre-opening
office set up and IT requirements in place, so
when new associates join the team they are
productive from day one,” he says.
To this, the size, diversity and skill set of
the pre-opening team are dependant on
factors that include the number of
guestrooms, the hotel facilities such as the
spa, swimming pool and the number of food
and beverage outlets, the hotel location, and
the hotel’s ‘star’ rating.
“The core team would include specialists in finance, sales and marketing, revenue
management, food and beverage, rooms, engineering, human resources and information
technology. Each of these key roles would have a number of direct reports to support the
various disciplines,” Mr Langer explains.
Other factors that support the appointment of the pre-opening team hinge on a number of
factors including the size of hotel, the facilities, the location, and whether or not the hotel is a full
or select service brand. It is also very dependent on the completion and handover of the hotel to
“Typically, half of the POB costs are salaries and benefits, so it’s important to manage this
carefully. The general manager, director of finance and director of sales and marketing are the
first to go on-board. The remaining key department heads follow in line with the approved POB
and critical path with the full leadership team on board three to four months prior to opening,”
Likewise, when it comes to the full appointment of staff prior to opening, all line associates
are typically on board three to four weeks prior to this with mass recruitment held six to eight
“During these final weeks, the focus is on system configuration and training, service and
procedural skills training and certification, uniform fitting, all associate orientation and brand
immersion. Then, as the full team comes together, it’s an important time to activate team-
building and engagement events to build rapport and confidence, through role-play and
Outlining his own responsibility as general manager to ensure the hotel opens on time, on
brand and on budget, he went on to say: “There is a large amount of time spent liaising with the
owners, designers and builders to address issues as they arise and to ensure the hotel team
stays focused on what matters.”
“The pre-opening critical path ensures key milestones are actioned on time and in a
systematic way. It is also important to manage and set the expectations with the hotel team in
preparation for the transition from pre-opening to opening and welcoming our first guests.”
Clarifying the GM’s involvement in the design and feel of the hotel, he reveals that the
selection of the hotel brand and the overall design concept is typically finalised well in advance
of the general manager joining the project.
“We usually get involved with details such as signage, final locations of power and data and
select FF&E (furniture, fixtures and equipment) items. The OS&E (operating supplies and
equipment) lists are completed during the early stages of the project, as many items have a 12
to 16 week lead-time and often require coordination for installation and placement.”
Describing his biggest challenge as keeping the team focused, motivated and engaged, Mr
Langer says: “As the opening draws closer, the hours get longer and the stress levels increase.
It’s important to share a clear vision of how everyone’s hard work will come together and that
the team isn’t distracted with matters that don’t add any value to the opening process.”
“Staying on top of the critical path and remaining organised can alleviate the stress levels, but
I also enjoy a run or long walk to reinvigorate the mind and body.” m
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LEGAL ISSUES | MATT CROUCH
managers, PCOs, venues and other
suppliers for events and, yes, some lawyers
too (perish the thought!), seem to consider:
1. termination of the contract; and
2. cancellation of the event,
as being essentially the same thing. In
fact, they are very different animals...
This is not just an esoteric point of law or
theory. Events do get cancelled and,
unfortunately, sometimes a party to a
contract wants to end the deal – but they are
two very different animals with very different
practical and legal consequences.
Termination of the contract: A contract, as
we know, is a binding agreement between
two (or more) parties, usually for the supply
of goods or services. We’ll use the example
of a PCO’s contract to manage a conference
for a client.
A contract of this kind is often a long-term
thing. Typically, there will be a lengthy period
before the conference actually takes place.
The PCO has a lot to do. It will often create
an event design, a budget, arrange a venue
and other suppliers (such as food and
beverage, audio-visual services) arrange and
design a website, promotional material and
attract sponsors and exhibitors delegates...
Some contracts allow the parties to terminate
“for convenience”, ie, “at will, without cause.
Most contracts will have termination-for-
cause provisions. These clauses allow one
party to end the contract if the other party fails
to perform their obligations – and are found in
an infinite variety. Sometimes a party can
terminate immediately; in other cases there is
It’s a question that often pops up in the meetings and
events sector, says Matt Crouch.
a window of time to rectify a breach of the agreement before termination rights are exercised.
Assume the client is unhappy with the PCO’s services and wants to terminate the contract for
breach. Whether the client can terminate the contract will depend on whether there has actually
been a breach and what the termination clause says.
The client would issue a notice of termination to the PCO. If the client gets this wrong, by
purporting to terminate the contract when it is not really entitled to do so, the client would itself
be in breach of the contract – but assume for the sake of this example that the client is within its
rights to terminate. From the effective date of termination, the contract is at an end. Neither
party is legally obliged to continue to perform its obligations. The PCO would stop work and the
client would cease paying fees to the PCO.
Despite termination, some provisions of the contract would remain on foot – that is, they
“survive” termination because they are intended to. Provisions dealing with liability, indemnities,
warranties, intellectual property and confidential information are examples.
Contracts often also include obligations for the supplier (here, the PCO) to provide
“transitional services”. If the contract ended by termination, the supplier may be required to
assist the client to move to an alternative supplier, by providing information etc.
Finally, and importantly, if the client terminates the agreement for breach, the client also has
the right to sue the PCO for loss caused by that breach. If, instead, the client exercises at will
termination rights, usually the client would have to pay the PCO for the work done up until the
date of termination – but the effect is the same: the contract is at an end. Cancellation of the
event is entirely different. The conference may not be financially viable or some external matter –
such as the explosion of an un-pronounceable Icelandic volcano or a pilots’ strike – means it
cannot be held as intended and needs to be cancelled.
In a situation like this, the contract needs to remain on foot. It is the event that is cancelled,
not the contract – and usually cancellation is the client’s decision alone. There may be a lot of
work for the PCO to do to notify suppliers, sponsors, exhibitors and delegates and they may be
entitled to refunds. Deposits already paid may need to be claimed back. The PCO should to be
paid for the work up to cancellation of the event and for additional work needed as a result of
cancellation – and for that, the contract needs to remain on foot.
Termination and cancellation provisions in your contracts need to be written with appropriate
balance of risk and reward and avoiding, where possible, harsh, automatic or “hair-trigger”
termination. Termination clauses in particular are often “asymmetrical”, meaning that one party
has more (or sometimes) the only rights of termination. As a colleague said: “There is no such
thing as a standard salad sandwich, so why should there be a standard termination clause?”
Your contracts need tailored termination and cancellation clauses. Beware cheap copies! m
Matt Crouch is the Principal of Matt Crouch Legal and can be contacted at: firstname.lastname@example.org
TERMINATION VERSUS CANCELLATION:
WHAT’S THE DIFF?
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