David Kong is the longest serving CEO of major hotels and will be leaving the BWH Hotel Group’s C-suite in the latter half of the year.
With the possibility of internal candidates being preferred by company boards, Hong Kong will be closely monitored in order to find the right candidate for his high-profile position at BWH.
Kong, 69 years old, was a member of Best Western Hotels & Resorts’ 2001 team and later became the company’s CEO in 2004. He was a key player in the firm’s 20-year growth. The company grew from just one brand to 18, and then he formed the BWH Hotel Group.
It is a story about upward mobility that the CEO of the Greater Hospitality Industry has lived through. Kong, a Hong Kong native, immigrated from Hong Kong to the United States as a young adult. He began his career in hospitality as a dishwasher and busboy.
Kong released a statement in connection to Monday’s retirement announcement. He said that “this industry has enabled me to dream boldly and to follow those dreams without hesitation.” I feel fortunate to be surrounded with exceptional people throughout my career. Through sheer dedication and passion, we achieved bold goals that many would have thought impossible.
There were other headwinds. Best Western’s owners rejected a Kong-led attempt take the company public in 2019. This would have allowed it to be more competitive with Hilton and Marriott. The pandemic ravaged the industry a year later.
Best Western was prepared for anything during the first months of the pandemic. However, they managed to record the best ever revenue per room (the key performance indicator in the hotel industry) and still surpass the previous records. Kong, in an interview Monday with Skift, said that the company is on track to surpass this record once again.
He said, “I feel proud that we were able weather the storm, in spite of all the difficulties.”
Kong was a food and drink director at Omni Hotels & Resorts before joining Best Western.
He is remembered for his work at Best Western, where he helped to expand the brand portfolio and introduce upscale tiers. The company’s purchase of luxury soft brand group WorldHotels Collection, in 2019, prompted the creation of BWH Hotel Group. This is a sign of its push to new markets.
Kong stated that one of the biggest problems he faced pre-pandemic was an initiative to improve quality control between 2006 and 2008. This saw many shareholders leave and reduced its portfolio by around 40%.
He said, “It required a lot more courage and strength to accomplish that.”
The company’s long-standing leader was noticed by even its competitors.
Choice Hotels CEO Patrick Pacious stated that David “took the company through significant transformations from one brand to a multibrand family.” It took a lot listening and partnership, as well as a lot persuasion to achieve a positive outcome for the company and its members.
Mark Hoplamazian, Hyatt’s CEO, noted Monday that Kong had brought a sense of family to the business while leading the expansion phase.
Reaching a Ceiling
Kong took the next steps in his growth journey over recent years by transforming Best Western into a publicly-owned company. This was a decision he and others felt would help position Best Western to be more competitive with other major hotel chains like IHG Hotels & Resorts or Marriott.
Best Western is a non-profit company that licenses brands to its owners, who then become voting members. IHG and Marriott operate under franchise arrangements. Owners may have concerns about operational issues, but ultimately they don’t hold the power to reject policy such as a new brand standard or vote for it.
Skift told Kong in the early 2020 that scale is crucial today. You look at Hilton and Marriott. Their scale allows them to invest in many areas. Without scale you cannot make the investments you need and can’t achieve the results you want. As the distance between Hilton, Marriott and Best Western increases, it is becoming more challenging to keep up.
Members of Best Western voted against going public in 2019. Kong noted that the move would have been better for the company during the pandemic.
Kong said that the company managed to navigate the crisis’ first months with zero debt, and its finances were “very well” during a separate interview. He still wishes he had the same financial tools that his non-profit counterparts.
Who is currently running TV commercials? “It’s a public corporation running TV ads,” , he stated about the first months of the pandemic. What is the deal? Get a night free if you stay two nights. That’s how much it costs. It can cost millions. Television advertising costs millions. That’s what they can afford. They can’t.
Since then, he has softened his position when discussing the nature and future of the company.
Kong stated earlier in the year that it was anyone’s guess how the for-profit venture could have turned out.
The Succession Plan
Although it wasn’t clear who was next to succeed Kong on Monday, he noted that he had submitted to the board a list “three very powerful internal candidates”.
Sources familiar with the BWH Hotel Group’s successor search and those who knew him said that he did not divulge names but there were some top candidates.
Dorothy Dowling is the executive vice president of the company and chief marketing officer. She has worked with the company since 2004, and enjoys a great reputation in the hotel industry. Mark Straszynski (the company’s chief finance officer) and external candidates also are options.
After the passing of Arne Sörenson, Marriott chose Anthony Capuano as his successor to become CEO. This was in favor who has more experience in operations and development.
If the BWH board follows that lead, they will be looking for potential candidates like Ron Pohl (chief operations officer), Gregory Habeeb (president of WorldHotels), and Brad LeBlanc (chief development officer).
LeBlanc seemed to see the membership-owner model of the company as a strength in navigating the pandemic. He also avoided franchisee poaching by larger competitors.
Skift was told by LeBlanc earlier in the year, during an interview with Kong. The membership remembers how we treated them during great times as well as in very tough times such 2020.
Kong stated that the next CEO would be named in October. However, the company’s board was more focused on Monday on retirement news rather than its next CEO.
Ishwar Naran, the chairman of BWH Hotel Group, stated that David Kong was a “once in a life time leader” and his contributions to Best Western Hotels Group and BWH Hotel Group were truly unmeasurable. It has been a privilege to have worked alongside David, and to witness his extraordinary passion for our industry.
Photo credit: BWH Hotel Group CEO David Kong has been with BWH Hotel Group for 20 years, 17 as its CEO. He will be retiring at the end this year. Best Western
Publiated at Tue 14 Sep 2021, 04:02:24 (+0000).