Corporate finance leadership has seen growth beyond measures owing to the merging of world markets and the globalisation of the economy in the past couple of decades. The role of CFO’s has evolved and grown to that of a much higher entity. One such person who has achieved path-breaking growth with his calculated strategies is Amit Jaiswal, CFO of Royal Orchid Hotels.
Royal Orchid Hotels was established in Bangalore in 1973 by Chender K. Baljee. Royal Orchids was operating 15 hotels by 2008. By May 2015, they expanded their business, and the count of hotels rose to 28 which included 10 hotels owned by the company and 18 hotels being managed by joined ventures and contracts. 2015 marked another milestone for Royal Orchids as they opened their first hotel outside of India, the Hotel Royal Orchid Azure in Nairobi.
Amit is a seasoned professional, with an experience of around 3 decades in the finance domain. He has made groundbreaking changes to ensure the efficient running of Royal Orchid Hotels. Before starting his work at Royal Orchid Hotels, he has worked as a finance manager at Kap Steel Limited.
In Conversation with Amit Jaiswal, CFO of Royal Orchid Hotels
Interviewer: Akanksha Nagariya
KredX: How do you define your journey as a professional?
Mr Jaiswal: My journey as a professional has evolved with time. Over the years, I have witnessed the country grow immensely. In those days, the economy was rigid, and the mindset of the people was different. Back then, the term CFO didn’t exist; there was just a finance head catering to the needs of balance sheets. I feel, the role of a CFO has emerged in the last ten years, and it has been continuously evolving ever since. In the past five years, this role has got a proper definition, and it comes with a lot of expectations and responsibilities. Now, a CFO has become an imperative guiding factor for any successful business.
I started my career in 1992, Kolkata, a time when the use of MS office wasn’t that prevalent. After working there for a few years, I came to Bangalore, and before joining the hospitality industry, I worked in various industries including manufacturing, chemical, and steel to name a few. Post that, I joined the Royal Orchid Hotels in 2006 as one of the finance controllers. I grew over the years, both in terms of learning and career, and today I am the CFO here. I witnessed the growth of Royal Orchid Hotels from the front seat, watching it grow from a mere 5 hotels to more than 50 hotels.
KredX: What are the most important experiences in your life that have bought you here today from a career perspective?
Mr Jaiswal: For me, this question is very crucial as I am a firm believer of experience contributing to most of the learning for anybody. From the year 2001 to 2006, I had the opportunity to handle various legal matters for my previous companies. Handling these legal processes gave my career the push that it had been waiting for. According to me, having legal knowledge lets you assess the impact of any action over the years. It helps you analyse a situation and stops you from taking any action that could cripple the company later on. This experience broadened my horizons and helped me to have a knack for details, consequently, making me successful in my field over the years. I believe any professional, despite of the profession, should possess some form of legal knowledge which will help him/her in decision-making in the future. If any individual realises the impact of their decision in due course of time, he or she can be very successful in their field.
A small example of this could be people signing multiple contracts without reading the document. But if a person reads and understands what these clauses mean, years later, the same thing will come as a rescue for that person. I find myself extremely lucky in receiving exposure to legal knowledge because it has been a primary factor in making me who I am today.
KredX: How do you manage to cope up with rapidly evolving technology and regulations around you?
Mr Jaiswal: Coping up with the constantly changing technology is a big hurdle. Today, we can find everything in our mobiles, and being up to date with its usage is very important. There was a time when people required a pen to write, however, today, you can type on your laptops or cell phones. Now, the world revolves around technology.
Take the example of airlines or hospitality industry, where various algorithms randomly change the rates on an hourly basis. I believe we are the first generation professionals who had to get used to technology. The current generation is well-versed in all things happening. Hence, it is easier for them to adapt to new technologies.
However, it has been a roller coaster ride for us to get accustomed to the changing technology and using it in the best possible manner. I always ensure to have a mix of young and experienced talents in my team. This way, I am able to strike the right balance in my team – it is an essential factor to ensure that the business runs smoothly.
I learnt the significance of adapting to new technology the hard way. Royal Orchid Hotels was changing its software and updating it to a more convenient one. We switched our system to Property Management Software (PMS) where we decided to integrate the sales force software, as well. However, I chose not to include banquet halls in the software as there wouldn’t be many bills for it on a daily basis. With the PMS system in place, any Royal Orchid employee could log in and check the day-to-day inventories of the hotel. But since we did not integrate banquets, we were not able to see the inventories of it. It did not take long for me to understand the mistake, and although it was time-consuming, we still went on to initiate the process of integrating banquets.
As far as the regulations are concerned, it isn’t as challenging as technology. Any change regarding any regulation can easily be communicated via multiple social media channels.
KredX: With the changing times, there has been a shift in the trends and responsibilities of a CFO. Being in this industry for so long, I am sure you might have also noticed some shifts. What are your views on that?
Mr Jaiswal: It is true that over the years there has been a prominent shift in the roles and responsibilities of a CFO. One thing that is expected from a CFO today is managing risk. Now, they have the power to accept or decline proposals based on the risk it poses to the company. For any company, its performance depends on the type of contracts they sign. And, I believe that if a company has a good CFO, it performs better compared to others.
Within Royal Orchid Hotels anything new that goes out is first consulted with me. It is essential for a CFO to be the guiding factor for the company apart from managing other roles and responsibilities. A CFO should always be reachable to everyone in the company. This enables a peaceful coexistence within all teams.
Kredx: What was the greatest challenge you’ve faced as a CFO externally, did you see it coming, or was it a total surprise, and how has it changed your management style?
Mr Jaiswal: The greatest challenge in my career was during the years 2009 – 2015. The market was severely hit, and it was undergoing a global recession. Nobody had foreseen it, and then in November 2009, we were struck by the Mumbai terror attacks. It was a tough time for most of the hotels in India.
From selling rooms at Rs 8000 per night, the rates dropped down to Rs 4000 per night. This was a time when we had to make some stringent changes within the company. We even had to sell off a property which wasn’t performing well. Selling a property is very hard as a lot of effort goes into building a hotel. But this property was massive, and we were incurring losses; as such we had to take this rather tough decision.
During this time, the room rents were slashed by 60%, and within two days the business dipped by 50%. We started suffering huge losses, and on December 1 we had a meeting regarding the same. A lot of things were discussed in this meeting like how to recover losses, how to implement cost-cutting, and how the staff needed to be mobilised. Within 15 days we reduced our workforce from 343 employees to 270 employees. Although the company took a lot of tough decisions, over a couple of years, we regained stability in the market.
KredX: With this much work, it is obvious for a CFO to have a lot of interaction on a daily basis with all the other teams of the company. As such there must be a lot of challenges that you, as a CFO have to face. So, what according to you are some challenges that a CFO has to face in the daily business within the company which might otherwise come in the way of running a business smoothly?
Mr Jaiswal: Long before, when the term CFO hadn’t even been coined, finance was a back office job. People often wondered that our work was limited to balance sheets. In due course and with a lot of hard work, this attitude changed and people understood the potential that the finance sector held.
As a CFO, I have to interact with all the teams, be it sales, operations, GMs, and more. A CFO is responsible for making others understand how much revenue the company is making. In the hospitality field, the primary focus has always been on the services.
With time the picture changed and so did the attitude of the people, and everybody started thinking like an entrepreneur. I took it as a responsibility to make others understand the game of occupancy. It is critical to understand what is better; selling one room for Rs 6000 or two rooms for Rs 4000 each. I explained the cost of rundown per room, and keeping this in mind, selling a room for Rs 6000 is better than selling two rooms for Rs 4000 each. It was critical for everyone to understand that a higher ARR results in a higher yield, making the bottom line of the balance sheet stronger.
KredX: Since your role is very diversified and involves interaction with almost every team. Which particular skill do you think has helped you the most apart from influencing? Also, if you can give an example from your life where this particular skill has helped you out.
Mr Jaiswal: I have been working with Royal Orchid Hotels from 2006, and I have a good grasp of the business now. Because of the continuity of my job, I am considered as someone from whom people can seek advice. At times, when a conflict arises between the sales and the operations team, I have to intervene and make them realise each other’s perspective. Pragmatic changes are required to support the sales team.
As a CFO, I believe it is critical to understand the requirement of the sales team and decisions should be made around them. It is as simple as the manufacturing industry; one should produce what can be sold and not sell what they can produce. There is enough competition out there, and we shouldn’t pull anyone down; instead, we should support them.
An example of such an instance is when one of our GMs got into some trouble. This particular person was managing our night clubs and use to wait in the hotel till 3 am. I felt it was my responsibility to make them understand that it wasn’t such a big deal. This man had been dedicating his entire day and night to the hotel. He had been responsibly staying till late at the hotel to ensure that nothing went wrong. Understanding his situation and his position seemed a better idea than blaming him for things. When everybody looked at the broader picture, they concluded that the whole thing wasn’t such a big deal in the first place.
KredX: Coming to the company, what is it that makes you extremely proud?
Mr Jaiswal: I love the fact that this company is very professionally managed. We all have been empowered by the directors here to take decisions at every level. Due to this, the company follows a decentralised decision process.
I am immensely proud that we are not just any other company which is run by a hierarchy. The company is not passed on to the family members but is rather passed on to those who have a genuine interest in the company.
At Royal Orchid Hotels, the employees are managed professionally and the decisions are very prompt. Employees don’t have to wait for a line of approval rather you are expected to take responsibility for your decisions. Goals and responsibilities are clearly aligned and it is expected to achieve that. Sometimes your decisions might turn out wrong but that is how people learn.
Another thing I feel proud of is that people work here for a longer duration. They spend a lot of years working here which could only mean that something must be really good about this company.
KredX: What is your definition of success?
Mr Jaiswal: Success for me is achieving something on which you have fixed your mind. The day I became the CFO of Royal Orchid Hotels, the share prices of the company were not performing well. In a meeting with my MD, I told him that I would increase the share prices by 200%. If I fail to do so, then I wouldn’t have achieved anything. My MD didn’t take me seriously at that time, but within 1.5 years our share prices hit that number.
I had to work extremely hard and improve the overall process. I could see the potential of the company, and I knew we would hit 100% of where we were at that time. Even though we are undermined in the market, I am well aware that the company has immense potential.
KredX: Was there a mentor, guide or somebody you looked up to or inspired you through the length of your journey, both professionally or personally?
Mr Jaiswal: There have been two people who have been a role model for me. They are Mr JC Kapoor and Mr Dhirubai Ambani. Although Mr JC Kapoor and I had a huge age difference, we still got along very well. He was in his 70s at that time while I was in my late 20s. He used to discuss business matters with me when I was a junior, and that made me who I am today.
I was visiting Mumbai for the negotiation for an office space. This space was supposed to be divided into three parts. I was sitting in this meeting with the retired Supreme Court judge as the arbitrator, and the negotiations were going on. I stepped out of the meeting and informed Mr Kapoor about the offer over the call. This happened three times and on the third time, he asked me a simple question – Who is sitting there in the meeting? He said that “Since you are present there, you will be able to take a better call.”
That day I learnt a significant lesson that one should never advise from the back. Too much of advice makes it tough for anyone to take a decision. If a person doesn’t follow this, they will always shove their responsibilities. Hence, it is essential for a company to allow its employees to take their decisions. True, there might be times when a decision is wrong, but it shouldn’t scare anyone. We all make mistakes, and that is how we learn. This is one life lesson that I always carry with me.
I met Dhirubai in 1994 at his Bombay office. During the meeting, one of his peons came to the room with a file that required urgent signatures. Dhirubai asked his assistant to take a seat while he was signing the documents. I was filled with awe for him and the way he treated his employees, irrespective of their position. The reason for any person’s success lies behind how they treat their employees.
KredX: What is your candid impression of young people today? What will be your advice to them?
Mr Jaiswal: Today’s youngsters are brilliant! I often say to my son that he can perceive things very well. The younger generation has been blessed with multiple modes of knowledge. The only thing that scares me about them is that they take life to be very easy. It constantly worries me that how will they face adversity? Today, youngsters don’t want to accept failure.
In life, it is essential to keep yourself open to things which are going against you. When we started job hunting, we got rejected by multiple places, but we were okay with it. We were patient and searched for other jobs. Nowadays children get so depressed if they don’t score 90%, but the truth is life doesn’t revolve around marks.
Hence, my advice to them is to learn things and have patience. The young generation needs to understand the details of a business. They want everything served on a platter which isn’t possible.
KredX: What gets you out of your bed early in the morning? What challenges do you face apart from work?
Mr Jaiswal: I roughly sketch the challenges and tasks that I have to do for the day in a diary. And, my goal comprises of striking off every task by the end of the day. I am not a fitness freak, but I like to keep myself fit.
Apart from that, I love socialising. My school batch comprised of 78 members and even today all of us are well connected. They all are associated with big firms and we meet for a reunion. One friend comes from Dubai especially to attend this event. Sometimes this becomes a challenge as I have to prioritise according to work. But I ensure that I still keep connected and am available as much as possible.
KredX: How many Whatsapp groups do you have?
Mr Jaiswal: I have eight Whatsapp groups which are active at all times.
KredX: Which is your all-time favourite quote?
Mr Jaiswal: My all time favourite quote is from a Bollywood movie “Zindagi badi honi chahiye, lambi nahi”
KredX: How would you describe your typical day?
Mr Jaiswal: I start my day by doing the household chores. I have to take my dog for a walk every day, otherwise, he barks and disrupts the entire home. The moment I get down from my bed he comes to me, and he needs to be taken out within 15 minutes; otherwise, he keeps on barking. After the walk, I have a cup of tea and read the newspaper. I press my shirt and get ready to come to the office.
I fix up my office work right in the morning, jot it down in a diary, and at the end of the day I strike out all of the completed tasks. I love to socialise at least 2 times a week.
Evenings are generally jam-packed. If I have to go to a party, I go back home to have my dinner and head for the party. I always make it a point to have dinner with my family. We make sure we don’t miss it as I have to travel for ten days in a month. I try to go to the gym three times a week where I do simple cardio.
KredX: Everybody does something or the other on a personal level to increase their productivity. What is that something when it comes to you? What do you do to increase your productivity? What is that thing that motivates you?
Mr Jaiswal: I increase productivity by reading as many books as possible. I try reading a book for at least 30-45 minutes everyday post dinner. I also try watching the news for 15-20 minutes every day to remain updated with the rest of the world.
KredX: What is your food preference?
Mr Jaiswal: I love Indian food. Apart from that, I enjoy Chinese cuisine.
KredX: Which is your favourite movie genre?
Mr Jaiswal: The last movie that I enjoyed was ‘M.S. Dhoni: The Untold Story’. Apart from that, I enjoyed watching ‘Three Idiots’ and ‘Taare Zameen Par’.
KredX: What is your favourite genre in the novels?
Mr Jaiswal: I love reading, so, it’s difficult to pick a favourite genre. My all-time favourite book is ‘Gone with the Wind.’
KredX: Do you prefer reading the hard copies of the newspaper or reading the news online?
Mr Jaiswal: I prefer reading hard copies of newspapers.
KredX: Are you a coffee or a tea person?
Mr Jaiswal: I am a tea person.
KredX: What is your favourite sport?
Mr Jaiswal: I love to play badminton. I believe anyone who plays badminton stays overall fit. When it comes to watching a sport, I prefer cricket.
KredX: What according to you is an ideal team outing?
Mr Jaiswal: According to me, an ideal outing comprises of going to a nice place which has a lot of scenic beauty. Indulge in activities, light a bonfire and drink till you are flat on the ground! A person should be able to enjoy and relax at a team outing.
KredX: How do you like to keep yourself fit?
Mr Jaiswal: I like monitoring my eating habits. I never overeat, instead, I like eating a small quantity of food every few hours. Apart from that, walking daily helps a lot. I especially enjoy walking for 20 minutes after dinner.
KredX: Coming to the end of the interview, Any advice you would like to give the future CFOs?
Mr Jaiswal: The only advice I would like to give the future CFOs is to possess legal knowledge. It is a must-have skill for any CFO as it helps to understand the business better and enhances decision-making skills. The road to becoming a successful CFO starts from thinking like an entrepreneur.