IHRA #28: Gerard Pelisson, Co-Founding Chairman Accor & President Paul Bocuse Institute, Delivers Opening Ceremony Address

IH&RA 41st Annual Congress: Highlights > Istanbul Conference Programme Highlights > Gerard Pelisson, Accor Founder, Speaks to IH&RA

Gerard Pelisson, Co-Founding Chairman Accor & President Paul Bocuse Institute, Delivers Opening Ceremony Address

Industry Legend, Gérard Pélisson, co-Founding Chairman of Accor and President of the Paul Bocuse Institute, gave this stirring address to IH&RA Congress Delegates in Istanbul on "Building Business - Building Partnerships."

Address by Gérard Pélisson to the IH&RA Congress
Istanbul - November 19, 2004

The Right Honorable Minister of Tourism, Ladies and Gentlemen.

It's an honor and a pleasure to be with you this evening. I would like to thank the IH&RA, and in particular its President, John Bell, and Vice-President, André Daguin, for their invitation to this Congress, which I am attending for the first time.

I am very honored to be able to address the Minister of Tourism and Culture, Mr. Erkan Mumçu, and the President of the Touristic Hotels and Investors Association, Mr. Timur Bayindir, and would like to thank them for their warm welcome today in this magnificent city of Istanbul.

Few cities can claim to have a history and a past as glorious as Istanbul, a place perhaps unique in the world in that it has brought together-and continues to bring together-so many different cultures and civilizations. Here, East and West reach out to each other, and this peaceful coexistence seems to me to symbolize the hospitality that is the mission of our fine hotel and restaurant profession.

Antoine de Saint-Exupéry, one of our important French writers, said, "the greatness of a profession is to unite people." I believe this is truly the case of our profession, and it's undoubtedly because of our liking for human contact that we have chosen it and that we are gathered here today for this Congress.

I have begun my address on a tone that you may find rather lyrical. That's because, in these difficult times, when the tourism industry has suffered not only from economic unrest but has also been the target of indiscriminate terrorist acts, it seemed to me quite important to focus the attention of our national governments on the critical role that we play in society.

At a time when sustainable development is a key concern, I would like to remind that we practice it every day, especially the social and societal aspects.

With regard to social practices, our business is not only one of the world's largest employers but also and above all one of the few where young people without specific diplomas can get a start and move up to positions of responsibility relatively quickly.

At Accor, more than half of our 160,000 employees are under 35 and every year 20,000 of them change their job, activity or region. We don't have many graduates of top business schools among our managers. We do have some and they're doing fine, but they are not the majority.

The same is true for many hotel and restaurant operators. And yet I don't have the impression that we manage our companies less efficiently than in other industries. On the contrary, in the recent wave of restructuring programs across Europe, the hotel and restaurant industry lost the fewest jobs. According to a report recently submitted to the French government on the flight of industry and jobs from Europe, between 2002 and 2004, fewer than 3,000 jobs were affected in our industry, compared with 180,000 in postal services and telecoms, 120,000 in financial services, 95,000 in transportation, 70,000 in mechanical industries and 29,000 in chemicals.

There is no unemployment in our industry. Instead, there are unfilled job vacancies.

With regard to the societal aspects of sustainable development, our profession is an impressive melting pot, whose development is rooted in the diversity of the people it employs.

Excuse me for again mentioning Accor, but it's the hotel company that I know best. Generally speaking, we employ equal numbers of men and women. True, this parity doesn't exist among managers but we're making progress in this area every year. For example, Cathy Kopp is head of our Human Resources Department, a position of strategic importance within the Group.

Most importantly, we are committed to hiring people locally, in the countries in which we operate. French nationals represent fewer than 100 of our 20,000 employees in the United States and fewer than 300 of our 30,000 employees in Asia. In France, our home country, we received an award for cultural diversity in recognition of our policy of diversity in employee recruitment, integration, mobility and promotion. The award was presented at the France-North Africa Convention early this year.

I know that many of you also give priority to diversity in hiring and that our industry certainly has the greatest diversity in terms of ethnic origin, religion and language.

If all the companies in other industries had the same concern and commitment for bringing together people of different origins, I'm sure that the social climate would be better in many countries. What's more, we would not have to be afraid, at the international level, of the "clash of civilizations," so often discussed in newspapers and best sellers.

In the same line of thinking, we should also recognize and encourage actions to support fair trade, such as purchasing coffee and other foodstuffs at a guaranteed minimum price. This is clearly one of the most efficient ways to counteract some of the disadvantages of globalization, which does not provide all countries with the same benefits.

I know that we are not perfect all the time, that working conditions are sometimes hard and that salaries are sometimes seen as inadequate compared to other industries. But in recent years we have made considerable progress in making our businesses more attractive.

Contrary to conventional wisdom, we now use the most advanced technologies in the areas of information systems, hotel construction, pollution control and energy conservation. In a word, we're able to offer jobs in all disciplines and at all skills levels.

In addition to its employment and societal aspects, sustainable development also involves environmental protection.

I won't go into this subject, except to repeat what my friend Paul Dubrule said: "the environment is the raw material of the tourism industry." In a way, the environment is a concern for all of us. If we don't participate actively to conserve water and energy resources, if we don't pay attention to protecting tourist sites, if we are interested only in taking advantage of tourist flows in regions that are already saturated, without trying to find appropriate lodging solutions in less developed regions, then we run the risk of losing our customers, who will find our hotels and restaurants too expensive for the degree of quality and comfort offered.

I feel that the IH&RA is best fulfilling its role when it is fully committed to these issues concerning sustainable development and ecotourism. I'm very eager to learn who will be the winners of this year's IH&RA Environmental Award, to be presented at your gala dinner.

As I have promised not to speak too much about Accor, I won't tell you what we're doing to help protect the environment, but I think we can all improve in this area. The low tourist revenues last summer in southern France, Spain and even Italy can be explained in part by saturation and excessively high prices.

Declining tourist flows is not a problem we will have to face in the years ahead. Mr. Frangialli has reassured us on that point. Our problem will be to anticipate changes in these flows and to help achieve a better balance. In my opinion, one figure stands out. The number of foreign visitors to France last year-75 million-is the same as the number of total international tourists worldwide in the early 1960s.

Europe, for example, enjoys many advantages as a tourist destination, including:
- A temperate climate.
- A very wide variety of natural features.
- A rich architectural and cultural heritage, both historical and modern.
- Modern, well-developed infrastructure and transportation networks.

But if Europe wants to continue attracting tourists willing to pay the price for a quality experience, I think it will need to pay closer attention to the saturation problem.

I think it is clear that certain parts of Europe are currently experiencing oversupply, at least for leisure tourism. That's good news for other regions of the world.

If the hotel and restaurant industry wants to maintain its ability to develop, we need to develop in the right places.

We also need to constantly refresh our offering and ensure that it meets-and even anticipates-demand. This need for renewal and adaptation is just as important as the need to continue expanding.

The world of tourism has become very complex. Customers are more changeable and with the development of easy online booking and low cost airlines, they can book at the last minute from among a range of increasingly diversified and faraway destinations. Faced with this situation, I think it is increasingly risky to "go it alone" and "put all one's eggs in the same basket."

I think that your Congress will study the question of partnerships to be built between the different players in the tourism industry-airlines, tour operators, travel agents and distributors, as well as hotel and restaurant operators and other local service providers. This is certainly the surest way not only to retain the customer base but also to forecast as accurately as possible how it will evolve from one season to the next.

At Accor, we have always built our development on partnerships, especially in emerging countries. We rarely invest alone, except sometimes to launch and test our products. This then makes it easier to find outside investors. For example, we built the first three Ibis hotels in Brazil with our own funds and we're taking the same approach in China. We then join forces with leading local organizations and develop our networks through management and brand licensing contracts.

Our marketing strategy also focuses on partnerships, for example with large companies that offer interesting opportunities for synergies or reciprocal arrangements. In distribution, for example, our Compagnie Internationale des Wagons Lits subsidiary allied with US-based Carlson in 1997 to create Carlson Wagonlit Travel. We have also long partnered Volkswagen in Europcar.

In addition, we promote partnership agreements in the areas of sports sponsorship and humanitarian actions, with the Olympic Movement and organizations like the Red Cross and Plan International.

The increasing use of partnership agreements is therefore a key component of our development and of our marketing and sales activities. The goal is to extend our geographical coverage and our presence in all market segments. This is what I mean when I say that we don't "go it alone."

The other way to meet the needs and expectations of customers who are increasingly unpredictable is "not to put all one's eggs in the same basket." That's one reason that led the Chairman of the Accor Management Board, Jean-Marc Espalioux, with the full support of the Group's Founding Co-Chairmen, Paul Dubrule and me, to acquire a nearly 30% equity stake in Club Méditerranée.

While the alliance with Club Méditerranée is more than just a partnership, contrary to some media reports it is not a takeover. Specifically, our goal was to strengthen our presence in leisure tourism, notably in the upscale segment. The decision of the Club's senior executives to refocus on the upscale segment was made before we acquired our stake. We did not create this strategy but we support it, as demonstrated by our complete confidence in the current Club Med management team.

I want to emphasize that our alliance with the Club does not in any way represent a change in direction or an innovation in the Group's strategy. As in the past, and unlike most of our major competitors, we want to cover all segments in the commercial lodging market, except for the most luxurious hotels, either directly or through equity investments.

Even as we enter the upscale vacation village market, we are of course pursuing our development in all hotel segments, especially in economy hotels. In the past, many countries, especially emerging countries, felt that luxury hotels were symbols of their progress and development. This is no longer the case. Just like in developed countries, emerging countries now must offer quality service at competitive prices in all market segments. That's why a chain like Ibis, which has been successfully developed in Europe, is extending its network to other parts of the world. It's already happened in Brazil, Indonesia and North Africa, and it will also happen more and more in China and sub-Saharan Africa.

Tourism is not all of a kind. There is business tourism, leisure tourism, religious, cultural, exotic and health tourism, seaside and mountain tourism. But tourists cannot be split up in this fashion. Each of them may want to try these different kinds of tourism, depending on the season, the geopolitical situation, health risks and so on. Our goal is to enable tourists to find what they are looking for wherever we operate. This is what has enabled us to take advantage of periods of growth and to limit the adverse effects when downturns occur and persist.

That concludes what I wanted to say about our industry, the crucial role it plays in creating social and societal cohesiveness, the need to pursue measures to protect the environment, our industry's "raw material," and the need to adapt in response to customers whose numbers will grow considerably in the years ahead, but who will also be harder to attract and retain.

I would like to close with an appeal to our national governments to recognize the enormous economic and social impact of our activities-and of the tourist industry in general-and to fully commit themselves to a partnership that I haven't mentioned yet but which seems at least as important as business partnerships-a public/private sector partnership.

The attractiveness of a country does not depend entirely on the drive of its tourism professionals. It also depends in large part on the welcome extended to foreign tourists by a country's people and public services. I'm sorry to say that in this area, my native country has a long way to go. I'm certain that the future belongs to those countries that, on the whole, offer visitors the warmest welcome.

I would also like to commend the IHRA for its initiatives to raise awareness of our industry's general interests and problems among the relevant United Nations agencies. That's because the question of a public/private sector partnership is also valid at the international level.

Thank you for your attention.

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