Hotel Strategy Is Not About Deciding What to Do. It Is About Deciding What Not to Do

We live in an era in which it seems that every hotel must do everything. Offer more services, operate through more sales channels, target more guest segments, create more experiences, run more promotions, maintain a greater social media presence and pursue more projects at the same time. Competitive pressure leads many properties to adopt initiatives without first asking whether they truly fit their value proposition. I often come across strategic plans that are, in reality, wish lists. Dozens of projects, investments and actions that may appear interesting individually but, taken together, end up diluting the hotel’s identity. Paradoxically, the more a property tries to encompass, the less recognisable and memorable it becomes. Perhaps that is why I find it so interesting to return to the origins of strategic thinking. Long before contemporary hotels, international chains, Revenue Management or hotel marketing existed, people were already reflecting on how to achieve objectives in uncertain environments. Strategy was born out of the need to survive in situations where resources were limited and a poor decision could compromise everything. It never ceases to surprise me that many of those lessons, written more than two thousand years ago, remain extraordinarily relevant to any Hospitality professional. The essence of strategy has not changed all that much: it is not about doing more than the competition, but about making better decisions than they do. And there is one particularly powerful idea which, in my view, should be present in every hotel executive committee: value arises as much from what we decide to do as from what we choose to forgo.

True strategy begins when we learn to say no

Lao Tzu wrote that usefulness arises from what does not exist. It is an apparently philosophical reflection which, when applied to the business world, takes on enormous significance. In strategy, real value emerges when we choose our “noes”.

• Not offering certain services, even if other hotels have introduced them or they are currently fashionable.
• Not competing in certain segments, even if there is sufficient demand to do so.
• Not pursuing every guest, because not every guest is aligned with the hotel’s value proposition.
• Not accepting every group or event, especially when it could compromise the experience of other guests.
• Not automatically lowering rates every time a competitor changes theirs.
• Not trying to please everyone, because that ambition often results in hotels with no personality.

This concept is especially important in Hospitality, where there is a strong temptation to become a hotel “for everyone”. Yet experience shows precisely the opposite: the strongest hotels tend to be those that know exactly who they exist for—and who they do not. Every strategic decision inevitably involves a trade-off. When we choose to position ourselves as Adults Only, we are saying that our product is not designed for family travel. When we commit to wellness and tranquillity, we are probably forgoing certain large-scale events. When we prioritise service quality over volume, we consciously accept that we will not always achieve the highest occupancy in the market. And that is not a weakness. It is exactly the opposite. It is having a strategy. Too often, we confuse strategy with continuous growth. We think that moving forward means adding rooms, services, departments, packages, channels, rate plans and activities. Yet strategy is not about adding; it is about choosing. One of the greatest mistakes in hotel management is interpreting every commercial opportunity as a strategic opportunity. Not every sale is worth capturing. Not every revenue stream contributes to profitability. Not every guest strengthens positioning. And not every initiative that works in another hotel makes sense in ours. I have seen many times that one of the most difficult decisions is not approving a new project, but stopping one that no longer adds value. Projects create momentum, personal commitments and a certain emotional resistance. No one wants to admit that an initiative which once seemed brilliant may not have been so brilliant after all. Yet sustaining it out of pride is often far more costly than cancelling it in time. In my experience, there are several questions every management team should answer regularly:

• Which guests have we consciously decided not to pursue? Trying to attract every segment usually results in a mediocre value proposition for all of them.
• Which services do not provide differentiation? Not everything the competition does should be part of our hotel. Differentiation comes precisely from doing certain things better than anyone else, not from doing everything.
• Which projects consume resources without generating competitive advantage? Many initiatives absorb time, money and talent simply because they have always been done that way.
• Which commercial channels genuinely strengthen our strategy? Selling more does not always mean selling better. Profitability depends on the channel, the price, the cost of acquisition, guest behaviour and the total revenue generated throughout the stay.
• Which brand promises are we willing to defend even when that means forgoing immediate revenue? Strategic consistency requires staying the course when apparently attractive opportunities arise but are incompatible with positioning.
• Which aspects of our operation exist out of habit rather than necessity? Every organisation accumulates processes, meetings and controls that once made sense but may no longer create value.

This way of thinking also explains why so many strategies fail. They do not always fail because they are poorly designed. They often fail because no one has had the courage to say: “we are not going to do this”. The result is an organisation attempting to move forward in too many directions at once. The Sales department pursues one segment, Revenue Management prioritises another, Operations tries to satisfy everyone, Marketing communicates different messages, and the guest ultimately fails to understand what truly makes the hotel different. Strategy should act as a selection criterion. Faced with any proposal, investment, campaign or operational change, the question should not simply be “can it work?”, but also “does it reinforce the hotel we have chosen to be?”. A project may be profitable and still weaken the strategy. An event may generate revenue while damaging the guest experience. A promotion may increase occupancy while eroding positioning. A new service may seem appealing while making a previously efficient operation more complex. In Hospitality, immediate profitability and strategic value do not always move in the same direction.

Strategy does not eliminate uncertainty: it teaches us to live with it

There is another lesson from classical strategic thinking that I consider especially relevant: strategy is never developed with perfect information. Never. Waiting until we have all the data before acting usually leads to paralysis. In Hospitality, we live with uncertainty constantly. We do not know exactly how demand will evolve, how the market will react to a new rate, what decisions competitors will make, how travel habits will change, or how economic and social shifts will affect tourism. Yet a hotel cannot remain still while waiting for absolute certainty. Rooms continue to perish every night, competitors continue to act, teams need direction, and the market does not stop evolving while we complete another report. Strategy requires moving forward even knowing that some of our assumptions will change along the way. That is precisely why strategic decisions should not be understood as immovable dogmas, but as reasoned bets that must be reviewed as new information emerges. The best hotel leaders do not seek to be right all the time. They seek a clear enough direction to be able to adjust course when necessary. The difference is important. Those who need to be right tend to protect their original decision. Those who need to achieve the objective are willing to change it. At this point, a fundamental distinction emerges between strategy and tactics. Strategy answers what we want to achieve, which position we want to occupy and the broad path we will take. Tactics answer how we will act specifically to make it happen. Changing a rate, adjusting a campaign, redesigning a menu, opening a distribution channel, launching a promotion, updating a procedure or changing a minimum-length-of-stay policy are tactical decisions. They may be important and have an immediate effect on results, but they should be subordinate to a higher strategic direction. Deciding what kind of hotel we want to be in five years’ time, which guests we want to attract, what experience we want to deliver, which capabilities we need to develop and what advantage we intend to build does belong in the realm of strategy. Too often, we devote most of our time to refining tactics while barely making space to question whether we are still moving in the right direction. We meet to analyse rates, costs, sales, occupancy and productivity, but not always to ask whether all those decisions are building the hotel we want to become. It is also worth remembering that strategy is not a document. A strategic plan can run to one hundred pages and change absolutely nothing. Strategy exists only when it influences the hotel’s day-to-day decisions. It exists when the Sales team knows which business it should accept and which it should turn away. It exists when Revenue Management understands that maximising revenue does not mean always selling at the highest rate, but protecting the mix of guests, channels and lengths of stay that delivers the greatest value to the hotel. It exists when Operations can distinguish between a reasonable exception and a concession that undermines the standard. It exists when Human Resources selects, trains and develops people who are aligned with the experience the hotel intends to deliver. It exists when Marketing communicates a recognisable identity rather than a succession of opportunistic messages. And above all, it exists when the team can explain in simple terms why the hotel makes certain decisions and rejects others. Strategy also requires an understanding of paradox. At times, the apparently more difficult path is the safer one. The easiest commercial channel may be the most expensive. The most demanding guest may compel us to improve processes that subsequently benefit the entire organisation. The investment that is hardest to justify in the short term may be the one that protects future profitability. In Hospitality, these kinds of paradoxes are common:

• Selling less can generate more profit when it reduces dependence on costly channels or low-profitability segments.
• Limiting services can improve the experience when it allows resources to be focused on those guests genuinely value.
• Turning down a group can protect more revenue if its impact threatens the satisfaction, reputation or loyalty of other guests.
• Raising rates can improve perceived value when the product and positioning justify the decision.
• Saying “no” to a request can strengthen trust when the refusal protects a standard or ensures fairness among guests.

The strategic paradox reminds us that the most intuitive decision is not always the right one. It also compels us to avoid one of the most dangerous practices in Hospitality: copying competitors without understanding their context. When a hotel introduces a new service, changes a rate or launches an experience, we do not know many of the reasons behind that decision. We do not know its costs, objectives, financial structure, operational constraints or the segment it is seeking to attract. Copying the visible action without understanding the strategy behind it may lead us to replicate only its costs. Strategy requires observation, but also independent judgement. Analysing the competition is essential. Systematically imitating it is a refusal to think. That is why I believe a sound hotel strategy must meet at least five conditions:

• It must be understandable. If the team cannot explain it simply, it will hardly be able to execute it.
• It must be selective. A strategy that includes every possible option is not a strategy, but an accumulation of aspirations.
• It must be coherent. The product, pricing, communication, distribution, people and operations must reinforce one another.
• It must be executable. It is not enough to aspire to a market position. The necessary resources must be available or developed to achieve it.
• It must be reviewable. Staying true to the purpose does not mean clinging to every initial decision.

When I work on a strategy, I try to avoid the temptation to begin with a long list of projects. I prefer to start with a far more uncomfortable question: what do we want to stop happening? Perhaps we want to stop relying excessively on certain channels. Stop attracting guests who do not fit the product. Stop competing solely on price. Stop improvising service. Stop launching promotions that contradict our positioning. Stop accepting business that generates revenue but destroys margin and wears down the team. Defining those boundaries often brings more clarity than adding ten new objectives. My advice is to set aside time regularly, away from operational urgency, to review not only what the hotel is doing, but also everything it should stop doing. The daily agenda will always find reasons to postpone this exercise, yet few decisions will have a more profound impact on the business’s profitability, reputation and consistency. I also recommend translating strategy into concrete decision-making criteria. The team does not need only broad concepts; it needs to understand what strategy means when faced with a group request, a commercial proposal, a complaint, an investment or an operational exception. The clearer these criteria are, the less dependent the organisation will be on improvisation. And above all, do not be afraid to forgo. In an industry accustomed to measuring success by everything it can sell, add and offer, sometimes the most intelligent act is precisely to protect what must not change. Because a hotel will never be extraordinary for doing many things, but for having chosen with great clarity the few things it wants to do exceptionally well—and for having had the courage to forgo all the rest.