India needs ‘innovative approach to tourism’

India needs ‘innovative approach to tourism’

Interview with Reto Wittwer, Chairman World Tourism Forum Lucerne and Aradhana Khowala, Board Member of World Tourism Forum Lucerne.

Aglobal hotelier with 40+ years’ experience, Reto Wittwer is a pre-eminent leader in the hospitality industry. Before founding Smart Hospitality Solutions, he was President and Chief Executive Officer of the Kempinski hotel group, for 20 years between 1995 and 2014. Wittwer previously held the position of President and Chief Executive Officer of Ciga S.p.A. between 1992 and 1995. Earlier, he was with Swissôtel for five years during when he was promoted to Senior VP Operations and then appointed President & CEO. Reto Wittwer is a Swiss national and a graduate of Ecole Hoteliere de Lausanne. He is also Chairman of the Board of World Tourism Forum Lucerne, a highly focused strategic body that brings together selected leaders around the world to reflect on the big challenges facing the industry.

Aradhana Khowala is globally identified as an authority on the travel, tourism and hospitality industries and has two decades of experience across more than 70 countries in four continents. She is currently CEO and Founder of Aptamind Partners and previously was the CEO of Tourism

Sector at NEOM in Saudi Arabia. She also serves as the Chair of the Advisory Board of the Red Sea Project and a Board Member of World Tourism Forum Lucerne. A British national of Indian origin, Aradhana has won multiple awards including the 21st Century Icon Awards in 2017 in association with CNBC and London School of Economics as an Inspirational Game Changer.

As leaders in the world hospitality industry how do you view the growth of the tourism sector in India? Reto Wittwer: As the Chairman of World Tourism Forum Lucerne in Switzerland as well as former President and CEO of Kempinski Hotels when I have had the privilege of visiting India hundreds of times in the last 30 years, we have closely followed the transformation in the tourism sector in India, especially under the stewardship of Prime Minister [Narendra] Modi where the numbers have changed drastically. A good example is growth in foreign arrivals, which was 9.5% in India last year, more than double that of the global average at 4%. Notwithstanding the

peak increase, the fact is the number of tourist arrivals (both domestic and international) are still a small fraction of what a country like India with its vibrant culture, art and architecture, rich civilisation, beautiful landscapes and above all the incomparable traditional Indian hospitality of “Atithi Devo Bhava” ought to attract.

India’s rapidly growing tourism sector now plays a huge role in the nation’s economy, supporting tens of millions of jobs and generating billions of dollars each year. This, we believe, is just the beginning as in the next 10 years, India is all set to become the third largest tourism economy by 2028 not only adding nearly 10 million jobs in the tourism sector but also capable of hosting all major international events - Olympics, World Expo, FIFA Championships among many others.

However, there are many challenges ahead of us, including the need to improve infrastructure and manage the reputation of being a safe, clean, shining India - to make Swacch Bharat a reality. Promotion of tourism industry should, therefore, be encouraged on a priority basis by

the Government of India through an aggressive tourism strategy. India needs an innovative and imaginative approach to tourism and also a blueprint to highlight India’s rich heritage including yoga, ayurveda, the core of Hindu philosophy and spirituality. This requires an integrated approach and uniform policy implementation. Aradhana Khowala: As an Indian origin global expert on tourism, I was proud to see India move up six places on World Travel and Tourism Competitiveness Index, from 40th rank in 2017 to 34th in 2019, as per World Economic Forum report. In fact, among the top 25% of all countries ranked in the WEF report, India witnessed the greatest improvement since 2017. I also know that India has the architecture, natural landscapes, culture, history, heritage and authenticity to be in Top 10 destinations globally. And I am not even talking about the strength of the domestic market which is huge.

The new Central Government policies have been very promising. With Ladakh having become a Union Territory, we estimate tourist inflow to increase substantially in the region. What we need now is a focus on tourism related infrastructure and promotions. And what we need to be careful about is sustainable development of tourism in India so that local communities benefit from the opportunities, breaking the cycle of poverty. India is big on our agenda.

Can you tell us a little more about the World Tourism Forum Lucerne Start-Up Innovation Camp in India? Reto Wittwer: World Tourism Forum Lucerne is widely recognised as the Davos of the travel, tourism and hospitality sector. World Tourism Forum Lucerne is the leading platform, where investors, CEOs, governments, academia, finance, start-ups and next generation of leaders forge a strong community bond to address future challenges of the industry. We at World Tourism Forum Lucerne regularly organise international and national Start-Up Innovation Camps to give visibility to the best new business models, foster inspiring StartUps and match them with interested investors. Our StartUp Camp brings together entrepreneurs from around the world for structured, immersive workshops and intensive feedback in multiple locations around the globe, as well as continued access to support and resources via our connectivity platform. The next StartUp Innovation Camp for the Indian subcontinent will take place on December 17 and 18, 2019 in Bangalore. Aradhana Khowala: For this Camp our two Indian partners are Indian Hotels Company Ltd (IHCL) and TATA Trusts, both of whom are enabling massive social impact and positive change in India and the world. Tata Trusts are amongst India’s oldest philanthropic organisations that, since its inception, have played a pioneering role in transforming traditional ideas to make a real difference to communities by driving innovation, furthering social inclusion and affirmative action. Indian Hotels Company Ltd is not just a hotel brand that represents the pride and culture of India. Its benevolent and inclusive way of doing business as well as its embracing of its social and environmental responsibility as a part of the way they do business and using that integration to drive economic value has been a role model for the tourism sector in India. Like our two partners we are hoping to engage even more in India to nurture a self sustaining ecosystem of innovation in India travel and tourism. Reto Wittwer Aradhana Khowala

26 October 2019 Tourism India Swiss institutes have historically been the last word on hospitality industry and many Indian students have been joining Swiss hotel management institutes. What advice would you have for aspirants in the hospitality industry? Aradhana Khowala: I am an alumnus of École hôtelière de Lausanne in Switzerland. Just last week it took the top position in the 2019 World University ranking for Hospitality & Leisure Management Universities, after celebrating its 125th anniversary and earning a highly coveted Michelin star. Two other Swiss institutions, Les Roches Global Hospitality Education and Glion Institute of Higher Education, took the third and fourth position respectively. This indicates that the Swiss Institutions are doing some things the right way. Having said that as with everything, prospective applicants need to be sure what they are buying into. Do your research, speak to past participants, alumni and know why you want a career in this sector. With a recession slated to hit US as well as global markets next year how do you see its impact on the hospitality industry? Will the demand fall? Will some of the big brands hit a plateau and will there be closures? Reto Wittwer: If we look at the industry fundamentals in US, which

are often a good reflection of global markets, we see that US occupancy has peaked and is at historical highs due to a long and uninterrupted expansion over last 10 years. GDP slowdown means it is harder for it to expand and yes demand will fall if US goes into recession. Not that it will indeed be the case.

What about an impact on India of such a slowdown in US and elsewhere? Reto Wittwer: Capacity growth in South East Asia and China has been strong but there might be demand weakness due to slowdown. We should see capacity growth slowdown in those geographies. If we look at India, there was huge capacity growth from 2008-2015 (15% pa) which led to prices crashing from the peak of 2007. Since then demand has outstripped supply significantly but the ADRs have not recovered as much. We are still 10-25% from peak. Aradhana Khowala: The fundamentals of Indian hospitality sector over the next few years look very robust after a difficult period of supply absorption. Occupancy is starting to reach the magic number of 70% which should mean ADRs improve and profitability of the sector improves significantly. Supply has been weak so far and as profitability improves, we should see new construction re

spond. We also need government policy help here in terms of approvals and land acquisition to ensure we don’t lose the momentum.

What inspired you to found Smart Hospitality Solutions/ SHS? Reo Wittwer: Throughout my life, my biggest passions have always been travel, luxury hospitality and the impact travel can make on the world and hence I’ve always operated in the nexus of this space. In my long career, I have travelled to 180+ countries and also have been fortunate to experience some of the best and the most unique experiences. And in all my working with high- and ultra-high net worth individuals I have learnt how travel and hospitality presents many pain-points for the “cash-rich, timepoor” travellers. This was something I wanted to address and we have done successfully through SHS with technology.

Brands and organisations that are slow, inefficient and deliver sub optimal customer experiences are prime targets for reinvention and disruption. Though most people don’t seek change for the sake of change, they will readily adopt better, faster, cheaper, less frustrating solutions. We wanted a brand that is prepared to disrupt itself by offering innovative alternatives.