Hyatt's CEO reveals the simple equation that underlies his management, hiring, and firing strategies

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Hyatt's CEO reveals the simple equation that underlies his management, hiring, and firing strategies

Mark Hoplamazian

Hollis Johnson/Business Insider

Mark Hoplamazian, CEO and President of Hyatt

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  • Mark Hoplamazian, CEO and president of Hyatt Hotels Corporation, started exploring what made Hyatt special about five years ago.
  • He found that the emotional connections between employees created a familial atmosphere.
  • In order to foster that sense of caring, Hoplamazian created an equation he's used to run the company and make decisions on hiring, firing, and managing his staff.
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When people join Hyatt, they often do so for life - the average tenure of a general manager at the hotel giant is about 25 years, according to Mark Hoplamazian, CEO and president of Hyatt Hotels Corporation.

Five years ago, Hoplamazian began to explore exactly what differentiated Hyatt from other companies. He knew from the start that people weren't coming in to work to just punch the clock or get customers into hotels. He himself felt the emotional connection that people had in the company.

"[It] was really special and very palpable and felt very much like a family," Hoplamazian said in a forthcoming interview with Business Insider. "In fact, we call everyone that works in, at, and for Hyatt, part of the family."

Hoplamazian took charge of the company over 12 years ago, and since then the company has been named one of the world's best places to work, and one of the best employers for diversity, all while growing to more than 100,000 employees across 56 countries.

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While "family" and "empathy" aren't the most common hallmarks of corporate culture, Hoplamazian found that those unquantifiable factors played a part in retaining employees and managing them well.

According to Hoplamazian, care is what makes Hyatt what it is.

So he developed an equation to help him apply care in all of his strategic decisions at Hyatt, from hiring to firing:

Empathy + action = care.

Care requires empathy, or knowledge of someone, with the addition of action based on what you know.

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From a research perspective, Hoplamazian's emphasis on care capitalizes on relatedness, or on the key psychological needs that everybody has. The data suggests that when people feel cared for at work, they're more likely to feel satisfied in their jobs.

Hoplamazian uses this equation to manage talent

He considers a sense of care an expectation for Hyatt's leaders and focuses on the care equation when talking about hiring, developing, and promoting people. He wants employees who align their jobs with their own sense of purpose.

A fulfilling career is one in which people are honest about what they love doing. When that spark or passion is missing, people tend to not be happy with their jobs regardless of the employer.

Employees who choose to leave Hyatt were probably, in Hoplamazian's view, "miscast." Instead of forcing them to stay in a position they don't want, he urges them to pursue their passions.

This method of managing talent allows his employees to thrive in their positions instead of merely getting by. It also ensures that the people who want to work at Hyatt feel cared for just as much as the people who find that their job isn't the right fit. Empathy, or understanding where that person is coming from, combines with action, or helping that person get to where they want to be. In the end, people feel cared for.

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Caring for people does not complicate decisions to let people go

Care is an essential aspect of decisions to let someone go. This might seem counterintuitive at first because letting someone go means exposing them to financial instability. It may even seem at odds with the family-like atmosphere Hoplamazian emphasizes. However, in a company as big as Hyatt, which has a lot of moving parts, sometimes decisions have to be made to maximize value to the customer or other parties interacting with the company.

Read more: The startup founder's guide to letting people go efficiently and compassionately

Hoplamazian maintains that the purpose of Hyatt, caring for people so they can be their best, reframes business decisions to let people go. In those instances, he demonstrates care in the context of them leaving the company.

"If you really find that your passion is elsewhere, you should go and we'll help you," Hoplamazian said. "We don't want you to be here and be out of sync with and out of congruence with your own purpose as an individual."

Instead of complicating business decisions, the equation of care improves them by giving Hoplamazian and other senior executives a standard for conducting operations at the company.

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Care is the underlying message of Hyatt, and it goes hand-in-hand with running an effective business.

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