If you want to go fast, go alone. If you want to go far, go together. — Success in any organization cannot occur when its definition and pathway only exist in the minds of its leaders. It must manifest itself up and down the organization through communication that is simple, consistent, and ongoing. At citizenM, we believe this happens when you have transparency with everyone in the company — the good, the bad, and the ugly. Whether that’s going over and over KPIs, explaining rationale behind business strategy, or even sharing financials to understand our real standing. In order to get to our destination, we all need to know not only which direction to row, but how far there is to go and why we’re rowing in the first place.
As a part of our series about business leaders who are shaking things up in their industry, I had the pleasure of interviewing Ernest Lee.
Ernest Lee is head of development and investments in North America for the Netherlands-based hotel company citizenM, and a member of the global executive management team. In his role, he is responsible for investment and development strategy and execution for citizenM hotels in the region.
About citizenM: The citizenM philosophy is ‘affordable luxury for the people,’ offering guests all the luxuries they would expect from a high-end hotel in a prime location, but without sky-high prices. citizenM places in an ‘upscale hotel’ category (based on measurable factors like the STR Global Chain Scale positioning matrix, which ranks hotels based on price vs review scores) — thanks to an unfailing dedication to design, art, technology and comfort. citizenM stands out among all other hotels by simply creating a category of its own — as an affordable luxury hotel. The first citizenM hotel opened at Amsterdam’s Schiphol Airport in 2008 and now operates 20 hotels and counting. citizenM’s unique value proposition, delivering a high profitability per square foot, allows them to develop hotels on prime locations in cities with the highest barriers to entry. In addition to citizenM’s established pipeline in the US’s largest cities, they are also venturing into new markets such as Toronto, Austin, Silicon Valley and Denver. The brand also just recently launched the new citizenM mobile app, which creates a 100% contactless experience for guests from top to bottom.
Thank you so much for doing this with us! Before we dig in, our readers would like to get to know you a bit more. Can you tell us a bit about your “backstory”? What led you to this particular career path?
I grew up in a middle-class town in Long Island where a lot of families were involved in the service industry. Because of that, my friends and I were always working random jobs in restaurants, catering halls, and pizza shops throughout high school. I’m not sure how good of employees we were, but I remember we always had a good time. When it came to college, I innocently conflated fun with career so I ended up enrolling in NYU’s hospitality school. That, and I wasn’t smart enough to be accepted pre-med. After my sophomore year, I entered into a management training program at a hotel formerly known as The Palace — they placed me in housekeeping. A few weeks on the job, my boss at the time told me to help prepare one of the rooms for the owner. I remember asking ‘how do you become a hotel owner?’ She told me I either needed to inherit a lot of money or go into real estate development. I checked my bank account and only saw overdraft fees, so I enrolled in real estate and business courses when registration opened up.
Can you tell our readers what it is about the work you’re doing that’s disruptive?
Finding ‘fast, good, and cheap’ is a moonshot in a lot of fields, but mostly fantasy in the hotels and property sector. And more often than not, you’re picking one of those areas, not two as the saying goes. We stubbornly set off to fix that, using every trick we could. And one of the ways we’ve done it is by taking back full control of our product and stakeholder chain. The hospitality industry is notorious for being fragmented — owners and developers on one side, operators and brands on the other. At citizenM, we bring every discipline under one roof as a fully integrated developer, investor and owner-operator, which allows us to consolidate decision-making and balance cost and quality better. Another strategy we’ve capitalized on is our use of technology in property development, which is a very archaic industry. Since the beginning, we adopted modular construction and virtual design as our preferred ways to build. This gives us not only speed, but also quality control. Thanks to this approach, we’ve built a global brand that has grown quickly over the past 10 years. with 40 hotels open or under development. These properties are located some of the world’s most exciting, but difficult to enter, markets, including London, Paris, New York, Amsterdam, Boston, and Kuala Lumpur among others.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lesson you learned from that?
This wasn’t funny at the time — mostly embarrassing — but I can laugh about it now. When I first started with the company, I was visiting our HQ in Amsterdam. Keep in mind this was still a phase where I knew less than 5% of my colleagues. While waiting for a ride to the office, my bag was stolen — phone, laptop, keys, wallet. Word quickly traveled the new guy was a hot mess. I ended up being so flustered that I borrowed 200 Euros from one of the office managers and cut my trip short, booking an early flight back to NY. My wife told my parents and my mom took it upon herself to pick me up from the airport, like when I was in grade school. That was the nail in the coffin — any pride remaining quickly left my body.
The lesson? Keep my wallet in my pocket.
In today’s parlance, being disruptive is usually a positive adjective. But is disrupting always good? When do we say the converse, that a system or structure has ‘withstood the test of time’? Can you articulate to our readers when disrupting an industry is positive, and when disrupting an industry is ‘not so positive’? Can you share some examples of what you mean?
No. When a disruptive company creates new socioeconomic risks, but either knowingly ignores these risks in favor of fast growth or uses questionable business practices — this type of disrupting should not be praised. At the risk of sounding like a disgruntled Incumbent, let’s take for example short-term rentals. The mass adoption of Airbnb is one of travel’s most important innovations — it’s a great brand and product and has made travel accessible and Interesting for many more people. But what it has also spawned is a group of startups that lease apartments and convert them into transient hotels. Often times, local zoning laws are ignored, community input is never received, and housing stock is removed from cities that need them most. To be clear, this is not a generalization of an industry which some may see as a net positive, but rather a view that disruptors should invest just as seriously in morality and ethics as they do in their efforts to scale.
Can you share 3 of the best words of advice you’ve gotten along your journey? Please give a story or example for each.
If you want to go fast, go alone. If you want to go far, go together.
Success in any organization cannot occur when its definition and pathway only exist in the minds of its leaders. It must manifest itself up and down the organization through communication that is simple, consistent, and ongoing. At citizenM, we believe this happens when you have transparency with everyone in the company — the good, the bad, and the ugly. Whether that’s going over and over KPIs, explaining rationale behind business strategy, or even sharing financials to understand our real standing. In order to get to our destination, we all need to know not only which direction to row, but how far there is to go and why we’re rowing in the first place.
When we all think alike, nobody thinks very much.
Group-think is the enemy of innovation and progress. When we lack diversity in perspectives and ways of thinking, we stop learning and improving — both as people and organizations. At citizenM, we make decisions in structures where all our stakeholders — guests, employees, partners, shareholders — have a seat at the table. Friendly friction is not only accepted but encouraged — by promoting a safe space where It’s okay to disagree. Sometimes this is at the expense of speed, but we firmly believe that listening to and challenging one another allows us to make better decisions over the long term.
In God we trust; all others bring data.
Challenging each other is one thing, but doing so in a rational and productive way is another. Without data, facts, evidence, we are simply relying on opinion, which can be counterproductive and flawed. We believe agreeing on the facts should always be the starting point, especially when dealing with colleagues who are representing a different set of interests.
Lead generation is one of the most important aspects of any business. Can you share some of the strategies you use to generate good, qualified leads?
Many companies in our industry have a lead generation structure that is based on an “all-star” system where greater weight is placed on individuals and high performers are treated differently. Retaining or recruiting under this format is incredibly taxing, let alone the detrimental impact it can have on company culture. It works for some, but as a primarily B2B company, we try to foster a leads system that encourages collaboration and an agile way of working — one where answers, skills, and relationships can be found and used anywhere in the company. In addition, our research and business intelligence teams are utilized heavily to make sure we spend our time wisely and have more substantive conversations with prospective clients or partners.
We are sure you aren’t done. How are you going to shake things up next?
This pandemic has obviously caused significant impacts to the way people work. Certain behavior will be short-lived, but others will be longer-term. We are developing solutions to some of the secular changes we think will happen in the workplace and with workforce. As a hotel company, we believe we are uniquely positioned to meet these changes.
Do you have a book, podcast, or talk that’s had a deep impact on your thinking? Can you share a story with us? Can you explain why it was so resonant with you?
A few years ago, I remember watching a TED Talk by an economist named Kate Raworth, who presented an economic model she developed called “Doughnut Economics.” The basic principle is that a modern economy should have a foundation providing basic human needs for everyone in your society, especially the most vulnerable, as well as a ceiling as to what you take from the environment. Everything else falls in the middle and is regenerative and distributive. This pandemic and the Black Lives Matter movement has been a stark reminder of how fragile we are as a society. Over the past few months, I keep thinking about how we can use this as an opportunity for a giant reset and whether “doughnut economics” could be adopted in some way for life as we move forward as a society.
On a separate note, I will also always stop what I’m doing to listen or watch Bakari Sellers in any interview. From culture to politics, I enjoy his very smart and fresh takes.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
My father was a big fan of Hemingway. So much so that he named me after him. That meant most of my life, I‘ve been immersed in and gently nudged towards Hemingway’s values. If I had to pick one, it would be: “Every man’s life ends the same way. It is only the details of how he lived and how he died that distinguish one man from another.” I would be lying to think I’m an everyday embodiment of this, but I do believe there is a certain level of dignity and honor one should live their life by — as a child, spouse, parent, neighbor, or colleague. Make an Impact and leave the world a better place.
You are a person of great influence. If you could inspire a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
Seek out people you disagree with professionally, ideologically, or culturally. As a society, we have this unfortunate tendency to dehumanize those we don’t align with. When we can understand their point of view, we can still disagree, but maybe can now do so with empathy.
How can our readers follow you online?
This was very inspiring. Thank you so much for joining us!