Veterans Unpacked | Rakesh Sarna: "The leader's job is to ensure a robust workforce not just a robust balance sheet"

Rakesh Sarna, former CEO and Managing Director at India's largest hotel chain - the Taj Group of Hotels (IHCL).

Note to readers: How ​do corporate leaders surf life after hanging up their boots? What do they do next? What are the lessons they learned in their eventful journeys? What advice do they have for the current crop of leaders? Veterans Unpacked is a series of interviews aimed to offer readers lessons from retired bosses on life outside the corner office.

Over a career spanning four decades in hospitality, Rakesh Sarna broke new ground by becoming one of the first Indian-origin chief executives at hotel giant Hyatt Corporation. During his tenure there, he was Group President for Hyatt in America, Chief Operating Officer for Hyatt's international operations and lastly as the CEO and Managing Director at India's largest hotel chain the Taj Group of Hotels (IHCL), where he led the creation of the philosophy of hospitality called  "Tajness",  slashed debt, restructured operations and saw market cap grow from $950 million in 2014 to $2.1 billion in 2017.

What have you been up to since hanging up your boots?

Since leaving the corporate world, we have been very busy. Both my wife Mei and I decided in 2011 that when we retire we would go back to school and that’s exactly what we did. We both graduated with Master of Arts degrees in Globalization and Security and graduated in 2021. That has kept us very busy for the last two years.

Also, in addition to that I have grown two scholarship programs. One I launched for students in North America and the second was for children of the non-executive employees of the Taj and Hyatt hotels in India. That then further extended into four overall buckets as we also established an endowment for young people for last mile programs in hospitality at the Florida International University (FIU) and then set up a scholarship in the name of my late dog Teddy for students who were studying veterinary sciences.

I don’t plan to work for anyone at this stage but I do also help with members of the hotel ownership community when asked for support or ideas or advice in terms of redesigning and I do it all on a pro-bono relaxed basis.

Life has actually been very busy and much more active than I had anticipated.

What keeps you busy now?

What keeps us busy is also the fact that we have been appointed as directors of the FIU Foundation Board which raises funds for the school and we are honoured to do that. The personal focus is also now very much on exercise, swimming and having a personal trainer help to keep you fit . When one was working full-time, it was maybe one hour three or four times a week and now it's a little more organized.  Our daughters live right next to us, so we spend a lot of quality time with them. We also try to reduce our TV viewing and do watch the odd show but reading is a part of my schedule and there is so much to consume and such little time. Two things I read daily are the Economist and the Financial Times. I'm currently reading A Promised Land by Barack Obama and 21 lessons for the 21st century by Yuval Noah Harari.

Looking back, can you tell us about three interesting events or anything that has stayed with you since?

Becoming a General Manager at a Hyatt in Macao in 1988 was one, as there were not many from South Asia or even Asia at that level and it would have only been possible with a brand like that because of their culture of treating all people fairly and equally.

The second was when I moved to Yugoslavia and the political leader Slobodan Milovesic broke the country up. It was very unsettling and violent and the hotel almost shut down. We had to get goods from Hungary by road and only had senior journalists such as Christiane Amanpour and diplomats staying in the hotel. To watch staff lose jobs and relatives was heart-breaking and I lived through that from start to end over two years and four months. It was really bad later when the NATO forces bombed Belgrade; luckily, I didn't have to endure that. But my time there taught me about the critical importance of people in your command and why you have to be so people-oriented. We wouldn’t have survived if not for the staff.

The next  event was the bombing of the Grand Hyatt in Aman, Jordan, in 2005 and by the time I had arrived at the hotel, it was all over. It was really  hard to be shown the skin and remnants of your colleagues all over the hotel and having to then go to each staff member's household to offer condolences. It was just exhausting physically and emotionally, and we lost several employees in that hotel.

The last most important event in my professional life was joining the Taj Group of Hotels even though I spent 35 wonderful years at the Hyatt which was special personally to me. The Taj was a national treasure and had an amazing culture at that time, and joining the Tata family was a blessing and I felt I could make a difference and was very fired up to get on board.

Remain customer centric and go out and face the customer and learn from them, as too many leaders hide behind their laptop absorbed in reports.

What you miss is that you are able to make a difference which is truly appreciated by a variety of stakeholders and also have the authority to make a difference in the lives of staff, guests, investors and stakeholders. I miss that. The sense of satisfaction I got from that was extraordinary. I miss designing hotels and creating new concepts in food and beverages and chasing a deal and getting a new hotel signed without putting any equity in. That is always a rush for any hotelier and also of course to take a company that is drowning in bad debt and low morale and turning it around, of course all give you a sense of achievement.

If you had to relive your corporate career, what would you do differently?

I have felt blessed to have gotten all the opportunities I got. I was a community college graduate from an unknown university in Canada and was lucky to join a company called the Hyatt that took me around the world and had me absorb and learn the skills and the opportunities to become what I became and then of course, I had the Taj, so I would change nothing for I believe I have had more than my share of good fortune, to be honest, in life.

What are the changes in the corporate world that you see now that are vastly different from your time?

In the hotel world there are two sides, one is the guest side which is driven by employees and the second is the transactional nature of the business.  The second has changed with firms buying out others and trying to create large balance sheets. However, from a guest point of view, not much has changed except that they are trying to use technology to heighten the experience but the essence hasn’t changed because the guests haven’t. The need for clean sheets, wonderful bathrooms, great food, peace and quiet has not changed except you add high-speed internet to it today. The fundamentals remain the same so the guests are really driving the process and I suppose most hotels are trying to keep up with it.

Which business leader in the current crop impresses you?

The mainstream ones that come to mind on top of the list are Tim Cook from Apple because of the way he has taken the mantle from Steve Jobs and without any fuss and drama gone ahead and made it a trillion-dollar brand, and continues to slog away without making waves. The second one is Satya Nadella, a man who comes from India and  took over  Microsoft and woken up the tech giant from its slumber. The other leader  who impresses and operates on the cusp of policy and finance is Gita Gopinath.

People talk about EQ and so on but empathy is the most important attribute, and junior, middle or senior leaders don’t have enough of it unfortunately.

We started much before we retired, and the idea was always that I would wind down work at age 60 or 62. Neither one of us likes golf or sitting on the beach all day, so the decision to choose Florida was because both my daughters are there and we had no desire to stay in cold states after having lived in Chicago and Switzerland. The plan was always to retire in the United States.

Is there anything you would tell your younger self?

Yes, empathy has become a buzzword today but has always been there and has been defined differently. My parents would say treat others like you want to be treated. I wish I had a stronger sense of that concept as a younger person. I have tried to be empathetic because humans generally find it hard to look beyond their own needs and people talk about EQ and so on but empathy is the most important attribute, and junior, middle or senior leaders don’t have enough of it unfortunately. The job is to ensure a robust workforce not just a robust balance sheet and that cannot happen without empathy and mutual respect for the colleagues that make you successful.

What is your advice for the next cadre of corporate leaders?

Treat the people who work for you and make you successful with respect and very well. There's a fine line between compassion and discipline. Remain customer-centric, and go out and face the customer and learn from them, as too many leaders hide behind their laptop absorbed in reports and don’t spend time with their staff and guests/customers.