Why InterContinental Hotels Group Is Taking The Better Buildings Challenge

Posted on January 9th, 2012 by

Paul Snyder,Vice-President of Corporate Responsibility for InterContinental Hotels Group (IHG), discusses why his company signed up for the Better Buildings Challenge and offers insight into the steps that his company is taking to lower energy use by 20% by 2020.

Full Transcript:

Ben lack: Why join the Better Buildings Challenge?
Paul Snyder: We were contacted by the Department of Energy and the White House to gauge our interest in it and we found ourselves interested for 3 primary reasons.First and foremost, the things they are trying to accomplish with Better Buildings Challenge and the way they’re trying to go about it is very commiserate with the way that we think about some of these things. For example, we’re both trying to push this agenda forward to make a more sustainable group of buildings out there within our estate. So, first of all, we seem to have the same kind of approach to these opportunities.Second, we believe as a company, that whether it’s our individual hotels or our whole portfolio in general, we’re a member of the community.We have a stake in how well the community does and this seems to be, on a grand scale, a community wide effort. It’s a national effort of coordinated action, again around addressing the efficiency, the carbon foot-printing, and the climate effects of our buildings. So, it’s very like us in our company to engage in coordinated community efforts.And finally, as we look out there and the things we try to achieve here at IHG, the more companies that are doing this kind of thing, the better for us all.There are a thousand ways that that’s true, but I’ll highlight a couple. When it comes to climate focused technology, building design, outfit, construction, the more firms that are providing products and services along those lines will make them more accessible and honestly, more cost efficient for us.The more society-wide pressure there is within the marketplace around these things, that’s better for all of us. As we also look at our long range vision in realizing that this co-ordinated action goes across several partners that have a lot of thought leadership that can be shared.

I also would point to the fact that this is where building design outfit and renovation is going and we want to be a part of that. We want to be a part of this discussion about where that goes and provide our own perspectives on it, from the hotel business in general and from IHG in particular.

Ben Lack: What measures are you and the DOE putting in place to ensure that you actually keep your word and do your part to lower the energy consumption across your portfolio?
Paul Snyder: We had to make some commitments as part of joining the challenge and that commitment was a 20% reduction in our energy use by 2020. We’re currently on a path for a 6-10% reduction by 2012, so we felt that again, we were aligned with what they’re trying to do and how they’re trying to do it.We committed to putting some programs in place in order to achieve that and to talk with and share some of the details of that program with the Better Buildings Challenge.  In addition, we will also share some data with the DOE, like other partners in the program, so they can conduct analysis across industries and across companies to see what and how well it works.All of this is very public.  We’ve committed to that kind of transparency and those results will be revealed to the public on a regular basis and we’ll be held accountable, not just by the DOE but also by the public.
Ben Lack: Can you give us an inside view into how you’re establishing the 20% baseline for energy savings?
Paul Snyder: We have a platform called Green Engage and that platform is made up of 2 modules. One is a measurement module, measuring our energy, waste and water.  That’s where we get the baseline. Then there’s a second module, which is our Green Solutions element and that has a whole range of strategies available to help with the management of our energy, waste, and water, and to improve the sustainability of our hotels. So, that’s where we get the baseline, it’s essentially from our read of our properties that are on that platform.
Ben Lack: How big is your team and how many folks are actively engaged throughout the company to satisfy these objectives?
Paul Snyder: To a certain extent, it’s on everybody’s agenda. We have a balanced score card that we call “The Wheel” in the company. There is one section of the wheel that focuses on Responsible Business and there’s a sub-portion of that wheel that concentrates on reducing our carbon footprint. In one way, everybody’s got something to do there. In terms of direct involvement, we’ve got a CR team that’s around 12 people across the globe. I’m the global lead on our sustainability strategy, but we leverage resources and people across the world. It’s hard for me to put a hard number on it because, like I said, everybody’s got it on their balanced score card. We’ve got hotel general managers that are really pushing agendas on this. We’ve got regional managers that have accountabilities for this. So, it’s something we recognized a few years ago, that in order for us to do this with impact and to do this right, it’s got to be measured, incentivised and pushed along just like any other result that enterprises go for, be they financial, customer facing or employee engaging.
Ben Lack: As you continue to do the work that you’ve been doing over the last couple of years by reducing energy use, can you give us an insight into what the biggest challenge has been, to not only get the buy-in but to also achieve the types of saving that you guys are committing to?
Paul Snyder: Well, I think the first challenge is the buy-in, to get people to understand the benefits of pursuing some of these strategies and we talk about those benefits really in 4 big buckets.The most obvious is financial, both cost aversion and making your P&L more efficient by pursuing some of these strategies. But also there’s a revenue element to it.Our customer base is increasingly telling us that it is important to them.  So, customers are starting to make more choices, based on which companies are doing things more substantively along these lines.We’ve got corporate clients interested in this area.  We sell hundreds of thousands of room nights to the Fortune 50-100-500 and they’re asking us, “What are you doing with regard to the environment and how can you help us reach our environmental goals as part of our supply chain”. There’s definitely a revenue aspect to it.Another bucket we talk about is our people, in terms of driving adoption and attention and focus on this.  Additionally, we are in a war for talent. We want the best people because the best people deliver the best hotel experiences and we have an ambition to be one of the great companies of the world, by delivering great hotels guests love.The fact is, you can’t do that without a talented, committed and motivated employee workforce and they tell us they’re interested in these issues as well.The final bucket is actually doing something substantively in absolute measure about our carbon footprint across the enterprise.Remember, we are primarily a franchise company.  It’s somebody else’s business. We’ve got to go to them and convince them why this is good business and we’ve gotten some really good traction on that.  The adoption of our platform over the last year is double. We think we’ve got the right argument. We’re saying the right things in terms of revealing to people the kind of value creation that comes out of engaging these strategies. That’s the first and foremost challenge.  Getting people to understand what this really can do for them in a sustainable way.In terms of achieving the targets themselves, challenges are around some things that we try to directly address in the tool.  A lot of that is educational in nature, which is, how hard is it to do something, how expensive is it, what’s the pay-back period, what do I need to do , and where do I start?Our Green Solutions tool has all of that information.  It provides the guidance to get over that initial hump, which is really just a very human thing of people feeling that the things they’re not familiar with are kind of risky.

The fact is we’ve got a big educational element in terms of the content of Green Solutions that really lays out for people, for their hotel in terms of what climate zone they’re in and other kinds of demographic info for their hotel that lets them know what certain sustainability strategies look like. From stuff that’s just operational flexing to stuff that’s medium or light investment to stuff that’s heavy investment.

So, we’ve found that there’s good momentum out there. People get educated about what this means, what the level of investment is and actually when they start to see the results and share the results amongst each other.  It creates just a general wave of momentum.

Ben Lack: Paul, why are you doing what you’re doing and why does this industry interest you?
Paul Snyder: I’ve been in the hotel industry for 17 years. I’ve spent most of it in operations and marketing and why I’m doing what I’m doing now is because I believe in this.I believe that within CR in general and with sustainability in particular, there are untapped reservoirs of competitive advantage, not just in our industry but in any industry, that have not fully been realized or explored. I think that a lot of what’s going to make one hotel company more competitive than another or one business more competitive than another is how well they leverage, explore and execute CR sustainability strategies. So, I’m doing what I’m doing, as I sometimes say to the folks I work with, because it’s truly what is next. The next wave of innovation within corporate America or with businesses in general is, I think, largely around sustainability.We’ve gone through TQM, we’ve gone through Six Sigma and a bunch of other stuff. I think that this particular wave of innovation, not only is what’s next but will probably be one of the most profound waves of innovation that businesses will go through. They’re all going to go through it, whether they are riding on the leading edge of it, or they’re being pulled behind, everybody’s going to go through this. It truly is what’s next and it’s going to be pretty profound and that’s an awfully big piece of work for us all and I’m excited to be a part of it.
Ben Lack: Before we let you go, is there anything else you’d like to share with our audience?
Paul Snyder: One of the things that I think really excites us, in terms of the opportunities that are presented to us, either by sustainability in general or efforts with the Better Buildings Challenge or efforts with folks like the U.S. Green Buildings Council is that there’s so much innovation out there.  You almost can’t get your arms around all of it.A lot of it is not figuring out what we need to do, it’s what do you do first? And that’s really an exciting place to be in because it just presents so much opportunity for all of us. I think the way companies and enterprises in general will be measured in terms of their worth is maturing from just a financial metric, to something that is much more holistic, circumspect and profound.So, whether it’s just in sustainability in particular or CR in general, this is where a lot of both real and perceived value of enterprises is going to be based.

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