Killing the Dragon
We have been using two neologisms like "mantras" for many years. They are now almost part of our DNA:
"Winning the Princess"when it comes to prizes and awards that we would like to win, and
"Killing the Dragon"when external circumstances force us to overcome a crisis. Voilà, - three such "dragon fights:"
The great fire
Two weeks before Christmas in 1988, we hosted the big Christmas party of an important association on our threshing floor - the hall in the attic of the old main building - which is still held here every year to this day. All three mayors from Nuremberg, Erlangen and Fürth were also present. Everything went smoothly until after the main course, but before we could serve dessert, flames suddenly burst out of the roof and we evacuated the building with around 200 guests in a flash and alerted the fire department.
Renate and I were also informed at home in Möhrendorf. By midnight, all our managers had arrived with us at the scene of the fire; we retired to a hotel room and planned the reopening.
When the insurance company's surveyor saw the next morning that the reopening date had already been set for us and that all the steps in between had been set out in writing, he called in the police. He couldn't imagine that the complex building project had been planned so quickly (the cause of the fire was a grease deflagration in the chimney).
On day TWO after the disaster, a white tent was set up in the courtyard for our breakfast guests from Party Service Käfer Munich. It was winter, the orange juice was slightly frozen - despite the construction site heating - and our guests loved it!
All other Christmas parties and a la carte reservations that had already been booked up to and including New Year's Eve were then distributed to colleagues in the Nuremberg area. Many of them didn't want to do it at first because they didn't have the manpower. So our kitchen and service team members were "loaned out" to these restaurants until the end of the year.
As is usually the case with fires: the least damage is the fire damage, followed by the water damage; but the biggest financial loss was due to the closure of all restaurant rooms for almost two months.
However, our business interruption insurance was able to settle the claim very precisely because we were able to prove, using our annual target plan, that the difference between target and actual from January to mid-December was only 3.6%. This was the only way we could accurately quantify the expected loss of sales.
Cheers to strategic planning!
Financial crisis 2009
In no country, in no sector and in no company does economic development always go upwards.
Hotels and restaurants are almost seismographs when a downward trend emerges. Because business meals, overnight stays, conferences and seminars are usually the first areas where savings are made when tight cost management is necessary.
For us, this was the case for the very first time in 2009 during the financial crisis! From 1984 to 2008, we had generated a total of 380% sales growth, and now sales plummeted by a whopping 10%.
Only rigid cost-cutting helped us to break even by the end of the year. The following year, we returned to our usual turnover.
However, 2009 was just the dress rehearsal, so to speak, for the really tough crisis that hit us - and all our colleagues - in 2020 and 2021.
The pandemic!
From one day to the next, the plug was pulled on us and our business was forced to close for 73 days during the first lockdown.
At that time, we had 72 permanent team members on the payroll, including 22 trainees, for whom short-time working benefits can only be paid after six weeks.
We still had to staff reception all day, but now it was no longer about reservations, but cancellations and queries, and our janitors were also still fully occupied. For example, all the water pipes had to be flushed every 72 hours to prevent legionella.
Short-time working was applied for and approved for all other team members.
Then came the trembling with the company closure insurance. Many colleagues got nothing, others only 10% of the agreed daily rate. But we had explicitly included the virus in the policy and were able to reach a fair agreement. The payment of around € 600 thousand almost made up for the lost liquidity.
Then it got really bad! The second lockdown lasted 221 days - without any compensation from an insurance company. Now our liquidity was melting like snow in the sun and the first important message we communicated to our team was:
"In a violent storm, a captain can't pay any attention to a sailor throwing up!"
There was no time for complaining or whining! An "open door policy", as we have had for decades, was not even possible. Nevertheless, communication was now more important than ever. Even the current account balances could now be seen regularly by our team members, so that everyone knew that we were "slaying the dragon" and that the jobs were safe. Radical transparency! We made it to the reopening on 13.6. 2022 (my birthday) to keep all our bank accounts in credit and did not have to draw on any of our agreed credit lines.
We also only lost three team members to other sectors during the coronavirus years.
Our most important communication tool was and is the "Human Stars App", which my son-in-law Dr. Marcel Setzer developed with my daughter years ago. Since 2015, all team members have been given an iPad and an introduction to this app on their first day at work.
All analog information is now digital. Mission statement, annual target plan, core processes, process descriptions, idea management, checklists, recipes and much more.
There is a chat function with which we can safely (servers are located in Munich) can communicate with each other. During the pandemic, we presented our annual target plans to our team members online for two years - just like a webinar - including a Q&A session.
In the meantime, Marcel's company, Human Stars GmbH, has already sold the APP to over 800 companies worldwide.
These include banks, hospitals, a defense company and even a major Japanese and American company. On the whole, it can be said that we have emerged from the pandemic with only minor, albeit painful, wounds.
We even used the period of closure to make counter-cyclical investments in order to carry out construction work that would not have been possible during ongoing operations.
And we struggled through the FAQs of the authorities, which were constantly being changed, according to the motto:"What do we care about yesterday's gossip?" There was no reliable legal certainty.
We even had to pay back the emergency aid of € 50 thousand, as a modest advance on the insurance benefit that was paid out later had been paid out to us two weeks too early.
Nevertheless, we succeeded in making a recognizable repositioning, broadening our base in order to be more attractive for private guests at the weekends.
The Schindlerhof has become a veritable "hotel village of the senses"!"