The Other Side of the Coin

Last week, in my entry title “Early Retirement vs. A Boot in the Ass”, I wrote a little about how I am feeling about the corporate transformation underway at Hilton. My friend and former colleague, Jeff Kirwan, told me, “I thought you may have judged our new executive management a bit harshly.” Jeff shared with me that the company is providing Employee Assistance Counselors to offer advice on coping both personally and professionally when faced with uncertainty and change. I agree that this indicates some level of care for the team members in the midst of so much turmoil, and I hope people take advantage of the offering. You just never know what contact will turn a light bulb on in your head. Think of it as a networking opportunity as much as a counseling session.

Let’s look at the other side of the coin, and separate the emotional storm generated by re-organization from the need that drove this transformation in the first place.

Just like individuals, corporations should always be striving to improve. The Hilton brands have been good at making changes to stay current with changing markets and customer needs. For example, Hampton recreated itself just a few years ago with the Make It Hampton initiative, and Embassy Suites redesigned their hotel design to make development of their all-suite product more affordable for owners, thus boosting their pipeline.

There were unquestionably some aspects of HHC’s corporate operations that needed to be re-evaluated and overhauled for the better. The brands have proven that drastic change is hard, but can result in a stronger path forward. Hilton’s IT organization was not immune to the need for change. If we Hilton team members and alumni are honest with ourselves and each other, we know that change was needed. There are organizational, staffing, and cost issues festering that need to be addressed. There is always room for evaluation and improvement. Executed properly, it’s healthy.

But change is hard. When jobs are eliminated, the faces of those affected are real to us, and we question the decisions made. My fervent hope is that our friends and colleagues will move on to find rewarding replacements to their lost jobs, perhaps changing their lives for the better. We probably all hope that the company being transformed comes out the other side of this successfully. Time will tell.

Even though I am retired from Hilton, I’m finding it impossible to disassociate myself from what’s going on. I care deeply about my friends and what they are experiencing. Oddly, I feel something like survivor’s guilt that I successfully bailed before all this happened. I truly hope that the Hilton of the future will be better than ever and a great place of opportunity for its team members. At the same time, I am grieving the loss of the daily camaraderie of long-time colleagues and the familiarity of “the good old days”. So I will shake my head in sorrow and learn to look forward instead.

Early Retirement vs. A Boot In The Ass

I have to admit that, since the tanking of the stock market accelerated after our retirement, there have been moments where Ron and I have looked at each other wondering, “What have we done?”. But only moments. Perhaps more accurately, we have flashes of momentary panic.

But there are 3 reasons we consider ourselves fortunate now, in spite of financial losses:

The Blackstone Group bought our former employer, Hilton Hotels Corporation, at a 40% premium over the trading value at the time. They took the company private, and bought out all of our stock. If we still owned our Hilton stock today, the value would have dropped approximately 50% (an assumption based upon where Hilton’s competitors are trading today). Our retirement plans would have been postponed by at least 5 years, instead of accelerated by 2 years with the buyout.

When the sale of the company to Blackstone closed, Co-Chairmen Barron Hilton and Steve Bollenbach were officially out of the picture. Barron Hilton (founder Conrad Hilton’s son) is an honorable man who was proud of and cared about the hotels that carry his family name. He and Steve Bollenbach always did business in a manner that exhibited respect for the people that made Hilton Hotels Corporation one of the leading hotel companies of the world. Over the years, I had the honor to meet both men on several occasions. They were gracious gentlemen with class. With Blackstone and new CEO Chris Nassetta, the legacy of a corporate family immediately went by the wayside, for a colder more calculating view of the business – not a hospitality business. Merely a business. That was a transition I had no interest in witnessing firsthand. I am happy not to be a party to it.

Finally, there is the matter of the official “Corporate Transformation”. In the name of transformation, hundreds of people around the world are losing their jobs, and some work previously done in the U.S. by Hilton team members will be outsourced overseas. Won’t that be a popular decision to explain, with the U.S. in the midst of its deepest recession in over a quarter of a century? So… The irony of this is that if I had been more loyal to the company and had not retired early, most likely I would have lost my job anyway. Would you rather feel that you are in control of your own destiny, or wait for the reward for your years of service to be a boot in the ass? I feel fortunate that the decision that seemed right for us has turned out to be SO FREAKIN’ RIGHT, and JUST IN TIME!

Disquieting though, is the view in my rear view mirror. Years of hard work, dedication, and several relocations have resulted in most of my friends being Hilton people. Great people they are too. They aren’t prepared to be statistics – they are individuals with mortgages, children to feed and put through school, and lives that shouldn’t be interrupted. Help your friends in need when you can. Plans don’t always come to fruition as hoped. But we all have to start with a plan. What we may not always realize is the importance of having a fall back plan.