Saturday, December 02, 2006

Pay for a BMW or pay suppliers?

Another ex Summit Hotel staff talks...

We met up with JJ last Saturday. JJ previously worked at Summit Hotel Subang USJ.

It's also Eve's birthday, so she belanja us to a delicious dinner at Hakka Restaurant at Jalan Kia Peng (KL), and then we went over to Jazz Bar for some good music. JJ joined us a short while later from his workplace just nearby. Hotel staff, especially middle managers, work long hours but he is happy where he is now. He also brought along 2 colleagues. JJ is a really fun guy, and he's doing very well at this hotel now. He is loyal to his friends and he introduces business leads to them. His boss is sending him for a short stint overseas to get international exposure.

After a while, they were feeling a bit uncomfortable with the attention showered on them by some GUYS. Those guys were not interested in any 4 of us leng loi (pretty gals)! So we went over to Maison club, next to Sheraton Imperial. JJ knows the people at Maison; he knows a lot of people in the club scene.

We then had supper at Jln Alor.

JJ said it's such a beautiful change of atmosphere working at his new place compared to the previous hotel. The present hotel is an international chain where management is professional and Board of Directors do not interfere unnecesarily. Here, there are clearly defined roles and responsibilities for top and middle management. Targets and directions are set in a clear and transparent way that allow management team to plan and execute strategies that achieve those targets without intervention or interruption. While cost management is critical in any hotel, it is not done so at the expense of service standard and long term business.

It was a totally different scenario at his previous hotel, he said. There, top management constantly overload the middle managers with more and more responsibilities until they can no longer function properly. They also don't get extra pay. Due to physical exhaustion, they had difficulty meeting expectations, yet they shoulder all the blame. Worse, they could be putting a lot of time and effort on trying to achieve certain aims, but often top management and the owner (Kenneth Teoh) would step in and change course like a zigzag driver. Sometimes, he didn't even know what they (middle managers) were supposed to do anymore. Top management & owner were shifting goalposts all the time. Often, they change their minds midway. He blames it on the owner who himself is not a trained professional hotelier. The only real concern on the owner's mind is costs, without an educated understanding of the relationship between cost and service standard, ultimately affecting the business.

There's a limit as to how much you can save without hurting the service quality. If you invest below the basic minimum, the service is simply not marketable because no customer will be willing to pay for it. Furthermore, JJ had much difficulty delivering on the standard of hotel service and keeping his customers happy because the owner was not paying suppliers, and suppliers then refused to deliver supplies. If the owner cannot understand something as simple as that, then the owner deserves to lose money, JJ said. (In other words, the owner made things even more difficult for hotel managers to do their jobs.)

Ironically, the hotel was not losing money at all. In fact, it was making money for the unappreciative owner. The hotel did have a hardworking management and marketing team, JJ conceded. (Note: The hotel management and the entire sales & marketing dept have now resigned.)

However, top management would deal with the cost problem by slashing staff salaries, which pleased the owner Kenneth Teoh. However, it became impossible for JJ to hire new staff of suitable skill level to replace those who left. To make up the numbers, he often had to hire those with no skills or poor attitude. A lot of time then had to be spent on training new staff on the job, leaving him with little time to actually manage. The time spent training would then be wasted when the new staff quit one week later for a better paying job in another hotel. This led to further drop in hotel service standards. It was an endless vicious cycle.

Yet, he was constantly being blamed for problems created that were beyond his control. He was made to bear the brunt of sloppy service. Sometimes, he could not even meet customer's orders because the ingredients/products ran out due to non-payment of supplies. His own salary was 20% below market, and his salary was not raised despite all his hard work and using his personal resources such as asking friends to do favours, to get things done for the hotel. It was like asking the poor people to help the rich get richer. (Work responsibilities raised but no corresponding pay increase).

There was a total lack of system and proper procedures. It was a confusing mess. The owner himself (Kenneth Teoh) would sidestep the reporting hierarchy and put some middle manager/dept head in a very awkward position of going against his immediate superior. JJ recognised that this management style only breeds resentment, confusion and politicking in the workplace. The whole system breaks down, mana ada productivity? (In other words, the owner actively encouraged managers to play the "Survivor" game - see my post in

JJ is glad he left Summit Hotel. It was a nightmare working there. He swore never to step into another hotel owned by a local "Chinaman" businessman, especially one like his previous hotel owner. There is a real reason why there are international hotel chains - professionalism. His former boss/owner think they could run a BMW business on a Wira budget.

JJ was visibly upset when remembering his time at Summit Hotel. The owner had no money to pay suppliers (causing supply interruption and creating unhappy customers) yet he bought a silver BMW-520 for his wife's personal use! In what way does the wife contribute to the hotel business, JJ asked?

Good question. Does this constitute abuse of company funds?

Readers should take note of this hotel before you apply for a job there - unless you are so desperate.

Note: At the moment, I can't verify whether the car was bought under the company or was it Kenneth Teoh's personal purchase. JJ says it was under Meda Inc Bhd. Either way, it's still a misallocation of resources. The owner should do the honourable thing of paying the suppliers first if he can afford to buy a BMW for his wife. The owner doesn't know his priorities. Our Deputy Prime Minister said something about good corporate governance the other day, right?


No comments: