Fall 2022 Issue

Extending Hospitality

Stephanie Coleman Linnartz M.B.A. ’97 thinks creatively about what Marriott International can be


By Claire De Lisle M.B.A. ’21

Fall 2022 Issue

SStephanie Coleman Linnartz M.B.A. ’97, president of Marriott International, wants you to know that Marriott is more than a hotel chain. • You’d be forgiven if hotels are the first things that come to mind when you think of the multinational company. After all, it operates more than 8,100 properties in 139 countries and is the largest lodging company in the world by number of rooms. • It also encompasses 30 brands and is growing in new areas of business, including home rentals, residential development, yachts, branded merchandise, travel insurance, credit cards and more.

“You can’t rest on your laurels — you constantly need to be coming up with new businesses and brand extensions, thinking creatively and pushing the boundaries,” she says.

Linnartz’s role encompasses brand, sales, marketing, revenue management, customer engagement, technology, emerging businesses and loyalty strategies for Marriott International. In addition, she oversees the company’s global real estate development, design and operations services functions and spearheads the company’s growth strategies. It’s a responsibility she is passionate about fulfilling — inspired by the people worldwide Marriott touches.

“Marriott is a global company, so between our employees and their families, millions of people depend on us for their livelihoods,” she says. “The most important obligation I have as a leader at Marriott is to have a really healthy, vibrant, growing company, to create opportunities for our people.”

LESSONS FROM THE PAST

Marriott didn’t start as a hotel chain. In 1927, J. Willard Marriott and his wife, Alice, started an A&W root beer stand in Washington, D.C. They expanded to serve hot food and became “Hot Shoppes” restaurants, with the first drive-thru on the East Coast. In 1957, they opened their first motel in Arlington, Virginia, and the rest, as they say, is history.

Growing up in the greater D.C. area, Linnartz felt an affinity for Marriott’s story. She was immersed in the hospitality industry as a child. Her family owned several restaurants over the years, including the well-known Irish pub The Dubliner on Capitol Hill (which at one point sold more Guinness than any other restaurant in the U.S.), and they still own and operate a boutique hotel downtown. The oldest of six siblings, she first traveled internationally to Ireland as a child with her family.

“For me, it’s all about the service aspect of it. I fell in love with hospitality and travel, and I truly believe they make the world a better place,” she says. “The more people gather face to face, the more they realize that at the end of the day, there’s more that connects us than divides us.”

Linnartz knew she wanted work in the corporate offices of Marriott to help grow the hospitality company that launched from her hometown.

But to do that, she needed an MBA.

Linnartz received her bachelor’s degree in political science and government from College of the Holy Cross, where she now serves as a trustee. But for her MBA, she was drawn to William & Mary for its history and community.

“My MBA opened doors for me. I learned a lot; it set me up for my first opportunity at Marriott, which turned into a great career,” she says.

In July, she celebrated 25 years with Marriott, a journey that brought her from financial analyst to, among other roles, global chief commercial officer from 2013-2019 and group president for consumer operations, technology and emerging businesses from 2019-2021. In the group president role, she oversaw the creation of Marriott Bonvoy, which is now the world’s largest hospitality loyalty program with over 169 million members.

But the move from group president to president of Marriott International, though well deserved, was born out of tragedy. In February 2021, Arne Sorenson, then president and CEO of Marriott International, suddenly passed away at age 62 while being treated for pancreatic cancer. Linnartz was named to the president role and Anthony Capuano was named CEO, both tasked with leading the company forward.

“Stephanie has a leadership track record and clear vision for how our core lodging business, travel platform initiatives and loyalty strategies can work together to accelerate growth,” said J.W. “Bill” Marriott, Jr., son of the company’s founder and chairman emeritus of the board, in the press release announcing her appointment. “Her deep experience across our business will enable her to work seamlessly with our owners and franchisees, innovate for our guests and customers, and champion new opportunities for our associates.”

Sorenson was Linnartz’s mentor and friend, and the example he set guides her as president.

“I learned three very important lessons from Arne that stand out the most. He was a really good listener and showed incredible empathy. He was always transparent and honest, even in the lowest point in the pandemic, when we had to make some tough choices. But he always painted a picture of hope for the future. He said travel would bounce back, and he was right, and it came back faster than we thought possible,” she says.

“Good leaders have that empathy, that transparency and that hope.”

PRINCIPLED ACHIEVEMENT

Linnartz returned to William & Mary in June as a keynote speaker for the 2022 MBA Alumni Weekend. It brought to the forefront “lots of great memories and lots of gratitude,” she says.

“Education is a gift. Education is the way up and out, to succeed in business or whatever your chosen path,” she says. “Especially when I have a chance to speak with undergraduates, I look at all the young faces in the audience and think, ‘This is the future, and these people sitting in the audience are so blessed to be going to an institution like William & Mary and to be learning and growing here.’”

Courtesy of Marriott International

In her address, Linnartz spoke on a theme she has seen reflected in her life and career: “principled achievement.” Former Raymond A. Mason School of Business Dean Larry Pulley ’74, P ’13, P ’15 often described the purpose of the business school as being “to prepare students for lives of principled achievement.”

Linnartz admired this values-driven success in the example set by Sorenson and is guided by it today. She sees principled achievement in the way Marriott International supports its employees and focuses on environmental sustainability.

“There’s a dignity in service work and it’s such a big part of our economy,” she says. “People come to Marriott for a career, not just a job — we have opportunities at every level, whether it’s at a hotel, the regional level or our corporate offices.”

Pre-pandemic, the service industry contributed approximately 10% of global GDP, 10% of all jobs were in travel tourism and 25% of new jobs being created were in travel tourism. Then the pandemic closed borders, restricted travel and brought new occupancy restrictions. It caused almost 25% of Marriott properties to close.

New challenges arose when pandemic restrictions eased and Marriott properties needed to find staff immediately to reopen and handle the new surge in demand. The U.S. Chamber of Commerce is calling the current combination of labor shortages and historic unemployment “The Great Reshuffle” — 47 million people quit their jobs in 2021, often looking for greater work-life balance and flexibility, increased compensation and strong company culture. At the same time, hiring rates have outpaced quit rates since November 2021. Leisure and hospitality had a quit rate of 4.5%, but a hiring rate of 8%.

Linnartz says while Marriott has not been impervious to labor shortages, she feels the culture of the company ensures Marriott can attract and keep talent at all levels. For example, about 50% of Marriott’s general managers started as hourly workers, and Marriott’s turnover rate is lower than that of the industry.

While much of the national conversation about the post-pandemic workforce has focused on work from home, Linnartz believes a broader definition of workplace flexibility is necessary to include the millions of workers worldwide whose jobs are location-based and cannot be made remote. An inclusive environment, she says, requires flexibility where appropriate throughout the organization. For example, Marriott is working on technology to create greater flexibility and allow housekeepers to trade shifts within and between properties quickly and easily.

She is also passionate about diversity and inclusion. In June, Marriott launched a new initiative, “Marriott’s Bridging the Gap,” which aims to boost hotel ownership among women and people who identify as Black, Hispanic, Native American or First Nations through financial support and other incentives. The company has pledged $50 million to this initiative, with a goal of establishing 3,000 hotels owned by underrepresented people by 2025.

“The combination of us leveraging our relationships and us actually putting our own money behind this is going to be the magic sauce that’s finally going to help us see the needle move in a more meaningful way. And the most important part of all this, at the end of the day, is about economic empowerment for women and people of color. We cannot see equity in the world unless there’s economic empowerment,” Linnartz said in a June 21 interview with Travel Weekly.

Marriott is also working to increase diversity among its suppliers. The company’s new corporate headquarters opened in July and was built by female-owned Rand Construction. Its founder and chairman, Linda Rabbitt, was awarded the inaugural Arne M. Sorenson Excellence in Leadership Award in 2022.

Linnartz’s appointment represents a step forward in representation of women in the company and the industry. She is the first female president of Marriott International, and women comprise just 30% of leaders in the hospitality industry and 25% of executives in corporate America overall, a gain of 5 percentage points over the last five years.

On the environmental front, Linnartz is cognizant of Marriott’s extensive global footprint and the impact it has on our planet. Marriott is committed to reaching zero net carbon emissions by 2050. Almost 50% of waste from a hotel is food waste, and Marriott aims to reduce this by half by 2025 with innovations such as technology that shows in real time what food is selling well and how much to reorder. Smart sensors in hotel rooms turn off the lights and adjust the air conditioning or heating when occupants are away. Other adjustments include building LEED-certified facilities, using energy-efficient lightbulbs and tracking water use.

Courtesy of Marriott International

These changes are good for the bottom line, too. A new study from environmental technology company GreenPrint found that 77% of Americans are concerned about the environmental impact of the products they buy and 64% of Americans are willing to pay more for environmentally sustainable products. A 2020 report by First Insight showed this was even higher for people in Gen Z (those who are less than 25 years old), with 73% willing to pay more.

Linnartz sees this in her own teenage daughter, who, like many other members of Gen Z, is interested in composting, prefers buying secondhand clothes and researches the sources and methods of companies she buys from to ensure they are socially responsible.

“Our employees care about the environment, they want to work for a company that cares about the environment, and our customers care about it, too — people increasingly make purchasing decisions based on sustainability,” Linnartz says.

MAKING A COMEBACK

Technology is not only helping Marriott become greener, it also allowed the company to adapt during the pandemic. Marriott International describes Linnartz’s role as being “at the intersection of technology and hospitality,” and she oversaw several tech updates as the pandemic swept the world. These included contactless check in and check out, and room and concierge service through the Marriott Bonvoy app along with Marriott.com enhancements.

“It’s that old expression, from crisis comes creativity,” she says. “We had to supercharge the rollout of certain technologies that will be part of our user experience moving forward.”

Now that the pandemic is transitioning to endemic, travel is rebounding. According to the U.S. Travel Association’s June report, Americans’ travel spending hit a new pandemic high of $101 billion in May and 89% of companies now allow nonessential business travel. Globally, spending on travel grew 22% from 2020 to 2021, reaching $5.8 billion.

Marriott International is seeing a significant increase in demand. Marriott’s worldwide occupancy rose to 68% in March 2022, which is less than 10 percentage points below pre-pandemic levels. This was the biggest increase in global demand since the pandemic began. The company also added 23,000 rooms around the world, nearly 30 percent of which were conversions from competitor brands.

Linnartz doesn’t take these successes for granted.

“I like to call it ‘healthy paranoia’ — in the past five years, companies have gone away or been severely disrupted that people never expected,” she says. “At Marriott, we live by the mantra our founder started and our recently retired executive chairman, Bill Marriott, says all the time: ‘Success is never final.’

“That means you constantly need to be saying, ‘How can we grow, innovate, change our business model, adapt our business model, come up with new offerings for consumers?’”

As well as ventures like credit cards and travel insurance, many of these new offerings focus on leisure travel, which before the pandemic was four times bigger as a market segment than business travel and growing more quickly. After the pandemic, its growth only increased.

“There’s been a shift in spending from things and products to experiences, so we leaned into that in a deeper, richer way,” she says.

That includes Marriott Homes & Villas, which are whole-home rentals in premium markets — an answer to competition from home-sharing services such as Vrbo and Airbnb — and The Ritz-Carlton Yacht Collection, the first of which will sail this fall. That doesn’t mean the company is shying away from products, however. The Marriott Bonvoy Boutiques include everything from bedding to luggage to home décor, with the option to purchase using Marriott Bonvoy loyalty points.

She also sees the rise of “bleisure” as a trend that will continue — combination business and leisure trips, such as when a traveler adds days at the beginning or end of a business trip to spend some vacation time at the destination. Being able to work remotely from anywhere also lessens the need for employees to rush back to the office after an offsite meeting or conference. While Monday, Tuesday and Wednesday were traditionally the busiest nights at hotels, the remainder of the week is seeing an uptick in popularity.

So what does the future hold for Linnartz?

“There’s something very powerful about living in the now and focusing on being the best you can be today,” she says. “But I’m super hopeful about the future. Marriott International is coming up on 96 years old and we are in great shape.”

SOMEWHERE BEYOND THE SEA: Marriott operates more than 8,100 properties in 139 countries and is the largest lodging company in the world by number of rooms. (Courtesy of Marriott International)