Four Seasons Goes to Paris: 53 Properties, 24 … part of tfin publication nuy be reproduced, stoted...

HARVARD BUSINESS SCHOOL 9-803-069 KI'V lANl'ARI « Z'H>I ROCÏBR HALIOWEI L DAVID BOWEN CAKIN-ISASEL KNOOP Four Seasons Goes to Paris: "53 Properties, 24 Countries, 1 Philosophy" Europe is différent front North America, and Paris is very différent. I did not say difficult. I said différent. — A senior Four Seasons manager In 2002, Four Seasons Hotels and Resorts was arguably thé world's leading operator of luxury hôtels, managing 53 properties in 24 countries and delivering what observers caîled "consistently exceptional service." For Four Seasons, that meant providing high-quality, truly personalized service to enable guests to maximize thé value cftheir tinte, however thé guest defined doing so. In 1999, Four Seasons opened thé Four Seasons Hôtel George V Paris (hereafter, "F. S. George V"), its fîrst French property, by renovating and operating thé Hôtel George V, a historié Parisian landmark Doing so was. according to John Young, executive vice président, human resources, "one of our gréât challenges and triumphs." Young mused on what Four Seasons had leamed from opening a hôtel in France, wondering what lessons would be applicable to other openings given thé firm's growth plans, which suggested that new opportunities would be largely ôutside North America. (Exhibit 1 illustrâtes property locations in 2002.) Performance Four Seasons generally operated (as opposed to owned) midsized luxury hôtels and resorts. From 19% through 2000 (inclusive). Four Seasons revenues increased at a compound rate of 22.6% per year. Operating margins increased from 58.8% to 67.9% during thé same period. Four Seasons' 2001 revenue per room (RevPAR) was 32% higher than that of its primary US. competitors and 27% higher than that of its European competitors. (Exhibit 2 provides summary financials.) rtofessor Roger Hallowell of Harvard Business School; David Btnvcn, Dean. Facully and Programs, and Protewar. Thundcrbfrd. The Amnkan Gmdiute School of IrUematioiMl Management: and Carin-lubel Kruop. Executive Dinxtur. Global Resenrch Group (HBS) prepared thia CM?. HBS oses are developed toleh/ as ihe basé* for cUss discussion. CAS» a» not intended Iw serve as endorMinrals, source» of prinuiry data, or illiKlralkire of effective ot incffttlive mmagenwnt Copyright C 2002 Pr»kk-nt and FeUows of Harvard Collège. To order copies or injuesr pt.-rmiMiion lo reprodu« malwinLi. c»ll I -aOO-M5-7685, mite Harvard Biuine» School Pubtbhing, Boston, MA 02163. or go to http //wmv.hbsp harvard.edu. No part of tfin publication nuy be reproduced, stoted in » retrieval >yMem, iwnj in a «preadsheet, or muwmitted In arry form t« by >ny même—tiectronic, photDctipying. recording. or othetww—«rithout ta permission of Harvard Biwinew School.

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Transcript of Four Seasons Goes to Paris: 53 Properties, 24 … part of tfin publication nuy be reproduced, stoted...

Page 1: Four Seasons Goes to Paris: 53 Properties, 24 … part of tfin publication nuy be reproduced, stoted in » retrieval >yMem, iwnj in a «preadsheet, or muwmitted In arry form t« by

H A R V A R D B U S I N E S S S C H O O L

9-803-069K I ' V l A N l ' A R I « Z ' H > I

ROCÏBR HALIOWEI L

DAVID BOWEN

CAKIN-ISASEL KNOOP

Four Seasons Goes to Paris:"53 Properties, 24 Countries, 1 Philosophy"

Europe is différent front North America, and Paris is very différent. I did not say difficult. I said différent.— A senior Four Seasons manager

In 2002, Four Seasons Hotels and Resorts was arguably thé world's leading operator of luxuryhôtels, managing 53 properties in 24 countries and delivering what observers caîled "consistentlyexceptional service." For Four Seasons, that meant providing high-quality, truly personalized serviceto enable guests to maximize thé value cftheir tinte, however thé guest defined doing so.

In 1999, Four Seasons opened thé Four Seasons Hôtel George V Paris (hereafter, "F. S. George V"),its fîrst French property, by renovating and operating thé Hôtel George V, a historié Parisianlandmark Doing so was. according to John Young, executive vice président, human resources, "oneof our gréât challenges and triumphs." Young mused on what Four Seasons had leamed fromopening a hôtel in France, wondering what lessons would be applicable to other openings given théfirm's growth plans, which suggested that new opportunities would be largely ôutside NorthAmerica. (Exhibit 1 illustrâtes property locations in 2002.)

Performance

Four Seasons generally operated (as opposed to owned) midsized luxury hôtels and resorts. From19% through 2000 (inclusive). Four Seasons revenues increased at a compound rate of 22.6% per year.Operating margins increased from 58.8% to 67.9% during thé same period. Four Seasons' 2001revenue per room (RevPAR) was 32% higher than that of its primary US. competitors and 27%higher than that of its European competitors. (Exhibit 2 provides summary financials.)

rtofessor Roger Hallowell of Harvard Business School; David Btnvcn, Dean. Facully and Programs, and Protewar. Thundcrbfrd. The AmnkanGmdiute School of IrUematioiMl Management: and Carin-lubel Kruop. Executive Dinxtur. Global Resenrch Group (HBS) prepared thia CM?.HBS oses are developed toleh/ as ihe basé* for cUss discussion. CAS» a» not intended Iw serve as endorMinrals, source» of prinuiry data, orilliKlralkire of effective ot incffttlive mmagenwnt

Copyright C 2002 Pr»kk-nt and FeUows of Harvard Collège. To order copies or injuesr pt.-rmiMiion lo reprodu« malwinLi. c»ll I -aOO-M5-7685,mite Harvard Biuine» School Pubtbhing, Boston, MA 02163. or go to http //wmv.hbsp harvard.edu. No part of tfin publication nuy bereproduced, stoted in » retrieval >yMem, iwnj in a «preadsheet, or muwmitted In arry form t« by >ny même—tiectronic,photDctipying. recording. or othetww— «rithout ta permission of Harvard Biwinew School.