Starwood relocates executive team to China for month

SHANGHAI CEO Frits van Paasschen and the rest of the top executive team of Starwood Hotels & Resorts Worldwide Inc. will spend the next four weeks headquartered in Shanghai, an immersive technique the company hopes will give leadership a better understanding of what is becoming Starwood’s most important market.

From June 8 through July 11, the Starwood executive team will conduct day-to-day business on a 12-hour time difference from its usual headquarters in White Plains, New York. This unique relocation underscores Starwood’s growth in China, which recently became its second largest market outside of the U.S. and its fastest growing. The move also reflects Starwood’s aim to cultivate a more global culture in a company that grew up largely in the United States.

“With properties in nearly 100 countries, Starwood is no longer an American company that happens to run some hotels overseas. Today, we’re a global company that happens to be based in New York,” van Paasschen says. “Eighty percent of our future pipeline is outside of North America, and nowhere is more emblematic of our global growth than China, where we will open one hotel every two weeks this year. China’s spectacular transformation is hard to grasp unless experienced firsthand; it’s the proverbial, ‘you can’t really understand a culture until you buy groceries there.’”

From their home base in Shanghai, van Paasschen and the eight members of his senior leadership team will conduct daily business in an effort to understand, appreciate and ultimately leverage different cultural perspectives and approaches to business. In addition, more than 20 Starwood executives from around the world will join the team throughout the course of the relocation. The group will delve into Starwood’s extensive business in China, meeting with local customers, partners and developers, while also touring new properties throughout the country.

During its month abroad, Starwood’s leadership team also hopes bolster the company’s guest loyalty outreach among Chinese travelers. As one of the world’s fastest-growing travel markets, with 100 million outbound travelers expected by 2015, China will play an outsized role in global travel within the next decade. The country continues to be the richest source of new loyal travelers for Starwood, with Chinese enrollment in Starwood Preferred Guest jumping 71% in 2010.

Starwood expects to make such month-long relocations an annual event, but in different locales. Other high-growth target markets include Brazil, the United Arab Emirates and India.

“It is not just language that gets lost in translation, but also cultural nuances,” van

Paasschen says. “The companies that will break away in an increasingly global world will be those that are most globally fluent.”