Sand castles Featured

8:00pm EDT July 26, 2007

A few years back, a friend who runs a large hotel chain asked

Gordon “Butch” Stewart if he could help evaluate the problems

plaguing the franchise.

Stewart, founder and chairman of Sandals Resorts and Beaches

Resorts, took a tour of one of the hotels and sat in on some meetings. He immediately noticed a big gap in the little day-to-day

details that were slowing the hotel down, such as front-desk service, and the high-end conversation the executives were having.

“When we went, I saw what the problems were, and I didn’t really want to stick my nose in,” Stewart says. “But I was a little befuddled at how simple the problems were and how complex their discussion was. Eventually, I pulled my friend aside and said, ‘Why

not pull back and think about this in terms of simple fixes that cost

a lot less? What you’re trying to do is a lot cheaper than what you

think.’ I guess there’s merit in the saying, ‘Keep it simple.’”

Keeping strategy simple drives continued growth at Sandals and

Beaches, the all-inclusive Caribbean resort juggernauts, along with

their worldwide representative arm, Unique Vacations Inc., based

in Miami. With more and more vacation spots popping up, Stewart

doesn’t want to catch himself in the clouds overanalyzing problems. His success has been in the all-inclusive business, and it has

been based on a tireless focus on hospitality and improvement.

His driving force is to get that right, down to every little detail.

From his first hotel unit in 1981 to the 16 resorts and more than

8,500 employees he oversees today, Stewart focuses on getting the

basics right. He continues to move forward, with a concentration

on beating the competition by growing a company that’s well

ahead of the market. With that meticulous attention to the little

things shaping everything from how he makes improvements to

how he paces growth, Stewart has built a vacation empire.

Focus on the details

To Stewart, paying attention to often-overlooked daily details is

the easiest path to successful growth. You can have the best business plan in the world, but he knows that if you don’t keep a close

eye on the day-to-day operations, then there is room for fatal error.

Sometimes that means admitting to mistakes and starting over,

rather than trying to make something work just to grow.

“Compromise, I think, is the thing that hurts the most,” Stewart

says. “I’ve broken down concrete many times that turned out differently than we thought or planned it would be. I’ve sold beds as

soon as I can get replacements because they weren’t as good as we

wanted them to be. We’ve closed restaurants that are not performing. That list goes on forever. If something comes out wrong

or isn’t working, stripping it down to the carpet isn’t the worst

thing.

“If something is wrong, it’s wrong. You can go a lot further by fixing it early than not paying attention to it.”

While Stewart believes that growing in an industry is simple if

you really focus on the little details, he says there has to be a constant mindset to that attention to detail.

“If you’re going to be successful at any industry, then there has to

be a thought process where literally every moment of your life you

have to be thinking of things that you can improve upon,” says

Stewart. “It is true that people are going to recommend your product. To be happy enough to do that, you need to impress.”

That attention to detail can’t just be in projects, according to

Stewart. It has to be a company culture that runs from top to bottom. That enthusiasm for hospitality drives Sandals and Beaches,

and Stewart says that pushing that core philosophy is the key to

bringing in new people. If you don’t understand that hospitality is

job No. 1, then you don’t get in the door.

“We don’t announce the vision on a daily basis,” he says. “But we

know where we are going, and people around you know because

they see you living it. If you’re very strong with your fundamentals

and show that every day, then people know what’s happening and

see if they can fit in.”

And, in the same matter-of-fact manner that Stewart will rip

down a building and start over, he says that you have to be clear-cut with employees who don’t match the culture, instead of trying

to force a fit.

“Again, if it’s a mistake, level with the employee,” Stewart says.

“Tell them, ‘You’re in the wrong business. Now, you might be a

good scientist, but you don’t do a good job of making people

happy.’”

Your people, after all, are a big part of your brand. And, to

Stewart, paying close attention to that brand internally is essential.

“In the same way that you would protect your brand if somebody

is doing something to try to injure it, the biggest injury is likely to

come from your own internal, weak operation,” says Stewart. “If

you look at the whole spectrum, on one hand, you might have

some people out there that would like to do damage to your

brand. So you’re going to protect it, but really and truly, you can do

more harm to yourself than anyone else at the end of the day, so

you have to make sure you and your people are performing.”

Make it better

An eye for the daily details isn’t enough. Stewart says you have

to grow with that meticulous nature and drive to do better.

“We have never wanted to be No. 2, and we need to look over

our shoulder,” Stewart says. “We don’t spend our time copying or

imitating, we bring out product after product that, in three years

time, the rest of the gang catches up to in their own way.”

Sandals and Beaches continue to reinvent the brand, re-evaluating what the customer wants in luxury accommodations. Instead

of settling for something that hasn’t failed you, Stewart says you

have to be looking for something that will really catch the attention of the customer.

That push for innovation has led to a list of firsts in the resort

world. Sandals was the first Caribbean resort to use Jacuzzis, the

first to offer satellite TV and the first to use swim-up pool bars.

All of them have since become commonplace, so Stewart wants

to keep pushing the envelope to stay ahead of the curve.

“That’s a natural tendency,” Stewart says of making improvements. “You finish something and it’s better than the one you did

before, so there’s an excitement to do something better than that.”

Similarly, Stewart has no problem spending money to grow out

a resort that’s already successful.

In August 2005, for example, Beaches Turks & Caicos Resort &

Spa underwent a $100 million expansion to create the Italian

Seaside Village. The resort was doing well; however, the expansion

added not just 168 rooms but also included a water park and playground to improve on the family atmosphere.

“I think we have a formula, a way that we do things to ensure our

success,” Stewart says. “We have had so many situations that we

have rooms in a place or a product or buildings that really could grow into something more, and we are inclined to do that work to

update it and make it better for our customer.”

And that philosophy can be pushed to your staff. Sandals and

Beaches constantly update standards and use technology to measure performance. It’s not enough for Stewart to push a culture

where the little details are the focus, but he also wants to ensure

that it’s being done by looking at the measurables.

“We have put more accountability into standards in the last seven

or eight months than we’ve done in the last 10 years,” says Stewart.

“We use technology that generally rates the standards, and it breaks

down all the different standards of the hotels from the cleanliness to

restaurants. We measure every detail we can, from rooms to swimming pools, staff, it rates service, and it breaks that down in every

part of the hotel.”

Know your market

Stewart believes that there is no ceiling to a blossoming company’s growth potential, unless you are going in the wrong direction.

“Our limitations really are to the extent that we can replicate this

culture and keep our people excited and have guests satisfied with

our performance,” says Stewart. “If you find that you’re falling

down, then it’s time to haul back and take a pulse.”

That means you have to keep track of your core priorities when it

comes time to grow. Stewart is very clear on the fact that Sandals is

a luxury brand thriving in a niche market. To grow, he knows that he

can’t get too far from the path that made him successful.

“There are a lot of people building hotels right now. And we have

no intention of getting into the big 1,000-room hotels,” he says.

“That’s not where we are going. We are going with a unique and

diversified product. We are focused on our own independent standards and enormous luxury; we’re better at paying attention to

details like the matter in which a room is furnished.”

Keeping the market in mind, you can still take risks, but they

have to come in the proper context of what your company can do.

Sandals, the original brand, is a resort experience meant only for

couples. But Stewart realized that while the couples experience

was popular, there was a whole segment of the market that was

being shut out. That’s when Beaches was created for families, singles and couples. The attention to detail was not lost on the new

brand, but the focus of that attention shifted. Instead of focusing

on something like a romantic waterfall view for a room, Beaches

concentrated on the family element and built resorts with video-game areas for kids.

The move was a risk, but Stewart balanced it with knowledge

about his customer base. Sandals already had a solid return rate

for its guests, and there was feedback from happy customers that

there was room for more. The results of that effort have checked

in with success: Sandals and Beaches currently boast a customer

return rate of 40 percent.

“It started off in a manner where I have so much return in guests,

and a lot of them said to me, ‘Butch, I’ve been here 11 times. I have

a mother that is single, I’d like to be able to come back, but I’d like

to be able to bring her or bring the kids,”’ Stewart says.

That doesn’t mean that Beaches came into existence without taking some lumps, of course. But by keeping on a similar track and

incorporating feedback, Stewart grew out Beaches ahead of the

competition and with the same mentality he shared with that big

hotel chain, he wanted all the little details to be right every step of

the way — without compromise.

“We have our ups and downs trying to stretch out,” Stewart says.

“But what’s important is that you are willing to react to what people are telling you and admit when you make mistakes.”

HOW TO REACH: Sandals Resorts, (888) 726-3257 or www.sandals.com; Beaches Resorts, (888) 232-2437 or www.beaches.com