Schneider Electric, Cornell University, and the Hotel Industry

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1 Schneider Electric, Cornell University, and the Hotel Industry A model for collaboration between industry and higher education by Schneider Electric February 2012 / White paper Make the most of your energy SM

2 Summary Introduction...3 Finding the right partner...4 A premier university program for hospitality education...5 Active collaboration...6 The newest venture: ecornell...8 Making an impact across the hotel industry...8 The value of relationships...9 More on the horizon...9 Conclusion...10

3 Introduction Much is made today of the importance of social networking through online media such as Facebook, Twitter, and YouTube. However, Schneider Electric has found a way to leverage a more traditional approach to business networking personal contacts and face-to-face collaboration. Working closely with Cornell University and its renowned School of Hotel Administration, Schneider Electric s Hotel team has created a partnership that has extended into many activities at the university, and has led to new relationships and innovative programs throughout the hotel industry. In fact, the impact of Schneider Electric s relationship-building approach has been felt literally around the world. Bill Minnock, SVP Global Operations Services for Marriott, says: I think what Schneider Electric is doing is brilliant. They re tapping into the expertise in Cornell, trying to solve very pressing business problems for the hospitality industry. They ve found a point of synergy between their best-in-class energy company, the world s best hospitality school, and the hoteliers of the world. This is a case study of how the relationship with Cornell was developed and the benefits that have accrued to Schneider Electric, the university and students, and the hotel industry as a whole. It is the hope of those involved that this experience can be used by other organizations and industries where energy plays a vital role. [Schneider Electric has] found a point of synergy between their best in class energy company, the world s best hospitality school, and the hoteliers of the world. - Bill Minnock, SVP, Marriott Hotels 1 U.S. Energy Information Administration, International Energy Outlook 2011, September 19, 2011 ( Schneider Electric, Cornell University, and the Hotel Industry 3

4 Finding the right partner Sean O Kane, Director of Hotel Strategic Alliances, Schneider Electric, understands very well the importance of energy in the hotel industry, since he worked as a hotelier himself for 24 years. Energy costs can represent between 3-8% of a hotel s total revenue, depending on the type, services offered, and location of the hotel, according to Mr. O Kane. Yet, for various reasons, energy is one of the least well-managed expense lines in a hotel s operating performance. In 2009, the Schneider Electric s Hotel business group was looking for ways to leverage the importance of energy in the hospitality business, through partnerships with other organizations and entities. This strategy made good business sense in its own right, and it also synergized with Schneider Electric s corporate focus on building relationships and partnerships with other organizations, in order to enhance the firm s reputation as a market and thought leader. With their knowledge of the hotel business, it didn t take the Schneider Electric team long to think of the ideal partner: Cornell University. Schneider Electric, Cornell University, and the Hotel Industry 4

5 A premier university program for hospitality education Cornell s School of Hotel Administration is recognized as one of the world s premier educational institutions for hotel management, whose graduates often go on to assume leadership roles in the major hotel companies of the world. What interested the Schneider Electric team in particular was the school s Center for Hospitality Research, which conducts panels and research projects on important topics in the industry, and publishes the results of that research on its website, available for free to industry, other universities, and the general public. The research center uses Cornell s own 4-star, 150-room Statler Hotel, and is aided by an Advisory Board from companies across the hotel and travel industry, who help fund the research. Our purpose is to connect academia and industry so they can work on issues of interest to both sides, says Rohit Verma, PhD, Executive Director of the Center. We have about 35 partner companies, and many more friends who are involved with our activities. These corporations provide funding for our research and support us in other ways through their industry knowledge and insights. Each partner company is asked to assign an executive to the Board, whose members are a Who s Who in the travel and hospitality business. They include executives from all the major hotel chains; travel firms such as Expedia and Priceline; lighting companies such as Phillips; and consulting organizations such as Price Waterhouse. One of the issues we re most concerned with is energy usage and sustainability. Schneider Electric...was a natural fit. - Rohit Verma, Executive Director, Cornell Center for Hospitality Research It seemed a perfect fit for us, says Mr. O Kane, an opportunity to have an impact along with other leaders in the hotel industry. It also seemed a perfect fit for Cornell, so Mr. O Kane and Pankaj Lal, Director Offer Management & Marketing - Energy Solutions, Schneider Electric, reached out to the University in the summer of Schneider Electric, Cornell University, and the Hotel Industry 5

6 Active collaboration When Schneider Electric approached us with their desire to participate in our Center for Hospitality Research, we were very excited, says Dr. Verma. One of the issues we re most concerned with is energy usage and sustainability. Schneider Electric has many products for energy management, and international experience in sustainability projects. We were lacking that perspective on our Board, so we felt right away that it was a natural fit. Mike Montanari, VP of Strategic Accounts, Schneider Electric, represents Schneider Electric on the Advisory Board. His efforts, along with those of Mr. O Kane and others in the company, have helped to grow the collaboration to the point that Schneider Electric is now actively involved with the Cornell Center in many ways. Research One of the Board s main roles is supporting the Center s research projects on energy efficiency that have the potential to impact hotels around the world. An experiment sponsored by Schneider Electric, and conducted by Cornell s engineering faculty, is now underway at Cornell s Statler Hotel. An experiment sponsored by Schneider Electric, and conducted by Cornell s engineering faculty, is now underway at Cornell s Statler Hotel. Several guest rooms are being equipped with Cassia guest room controllers to study the impact on energy use and costs. When completed, the results will be reported in the Cornell Hospitality Quarterly, which is read and used worldwide, including by other universities. According to Dr. Verma, other schools have downloaded more than 100,000 times from the web site for the School of Hotel Administration. Thousands more downloads have come from hotel and travel executives from every continent. (All reports and other materials are available for free at Roundtables Cornell hosts frequent roundtable discussions with industry leaders on various topics of importance in the hospitality world. Open to students, partners, and invited guests, the roundtables have addressed issues such as sustainability, labor and employment law, business ethics, service innovation, and a range of other topics. Mr. Montanari participates by suggesting topics and serving on the panels, alongside Mr. O Kane s frequent participation. We hold six to eight roundtables per year, says Dr. Verma. Suggestions for topics come from the Board and our faculty leads the discussions. Students participate too, and Dr. Verma says one evening of each Schneider Electric, Cornell University, and the Hotel Industry 6

7 roundtable is devoted just to industry and students: It gives our students a chance to interact directly with industry leaders. Of particular interest are the sustainability roundtables in which Mr. O Kane has been an active participant, along with hospitality leaders from around the world. These roundtables are leading the effort to bring the discussion of sustainability and energy management to the forefront of the hotel industry. Student competitions A relatively new activity is the Student Sustainability Competition, held annually in the spring to honor the best thesis work on the subject of sustainability by Cornell students. While the faculty ultimately judges the work and decides the winners, the students first make a presentation to the Board of industry partners, who offer feedback and advice. This clearly puts Schneider Electric at the top of vendors who are supporting the hotel industry. Being able to interact with and help the students, the next generation of leaders of the hotel industry, is one of the more rewarding aspects of our collaboration with Cornell, says Mr. O Kane. Schneider Electric, Cornell University, and the Hotel Industry 7

8 The newest venture: ecornell In 2010, Schneider Electric and Cornell announced yet another collaborative effort: an online certification program for Schneider Electric personnel who wish to become more knowledgeable about hotel asset and operational management. Using courses developed by Cornell s own faculty, ecornell offers global Schneider Electric employees a chance to gain valuable knowledge into hotel management, operational challenges, and other issues of importance in the industry. Schneider Electric employees can take six different courses online, learning at their own pace from the world s premier hospitality professors. This program has truly enabled me to talk the talk with the accounts that I call on, and demonstrate an understanding of the business goals that they typically don t get from a vendor, says Schneider Electric s Dave Griego, National Accounts Manager, Hotels. My classmates have been fascinating and literally come from around the world. Making an impact across the hotel industry For Schneider Electric, the collaboration with Cornell has been valuable in itself, but its impact has reached well beyond the university and into the worldwide hotel industry. One example is the deeper relationship that has developed with the American Hotel and Lodging Association (AH&LA), the primary advocacy association and voice for the US hotel industry. Its members include the management of virtually all the leading hotel companies in the world, some of whom also serve on the Cornell Board. Mr. O Kane sits on the Engineering and Environment Committee of AH&LA and has had a longstanding relationship with the AH&LA CEO, Joseph McInerny. It was through these contacts that Schneider Electric and the AH&LA reached an agreement that allows AH&LA members anywhere in the world to register for free energy management courses at Energy University ( Created and operated by Schneider Electric, Energy University is a professional-level education program offering more than 60 online courses on a wide array of energy topics, free to anyone who wishes to register. Energy University has trained more than 70,000 people around the world. All courses are entirely vendor-neutral and have been developed by professional educators and subject matter experts. Schneider Electric worked with the AH&LA to create a custom learning path at Energy University, and the courses are applicable for education credits for those who have been certified under by the hotel organization. Schneider Electric, Cornell University, and the Hotel Industry 8

9 The value of relationships In addition to the many formal programs and activities, Mr. O Kane also emphasizes the less tangible but very real value of working closely with academic and industry leaders on a regular basis. Cornell has become a nexus for education and industry working together. Here are all the stakeholders in the industry, from hoteliers to vendors such as Schneider Electric, working alongside researchers, faculty and students. It s a very exciting and vital environment. It s increasing our understanding of the hotel industry, and what our role can be in helping them meet their challenges. Bill Minnock, SVP for Marriott Hotels and fellow Advisory Board member at Cornell, agrees: Energy management is important to our guests for comfort and good citizenship. It s also important to our company, the cost of our buildings, and our day-to-day operations. Collaborating with a company like Schneider Electric, who is focused on sustainability solutions for the hotel industry, is valuable for everyone involved. More on the horizon Here are all the stakeholders in the industry, from hoteliers to vendors such as Schneider Electric, working alongside researchers, faculty and students. It s a very exciting and vital environment. - Sean O Kane, Schneider Electric Schneider Electric continues to work toward further opportunities to collaborate in the hotel industry. The Hotel team is currently discussing the possibility of working with a consortium of stakeholders from the industry, the International Tourism Partnership, to create a standard for measuring carbon emissions in hotels. The group is also looking at collaborative opportunities around issues other than energy, such as security, that are important to the hospitality industry. We believe we can take what has been learned from this productive relationship, and apply it in other places, says Mr. O Kane. Schneider Electric, Cornell University, and the Hotel Industry 9

10 Conclusion Three years after starting the collaboration with Cornell, the Hotel team at Schneider Electric says the effort has succeeded beyond their hopes. The key to this success, agree all those involved, is for everyone to provide value, and for everyone to receive benefits from the relationship. This has certainly been the case for the Cornell collaboration. The faculty and students at Cornell s Center for Hospitality Research benefit by gaining access to Schneider Electric s deep expertise in energy management and sustainability, and research guidance as well as stateof-the-art technology and products for energy monitoring and control. The participation of industry partners has led us into new areas, and fostered new research we could not have done on our own, says Dr. Verma. The hotel industry gains the chance to interact with a key company like Schneider Electric, which possesses unique knowledge and expertise in an area of vital importance and interest. And of course, Schneider Electric benefits in many ways, including having access to Cornell s world class research capabilities, close contact with key industry leaders, and a chance to impact the next generation of leaders, the students of Cornell. As Dr. Verma says, This kind of collaboration is a win for everyone. About Schneider Electric As a global specialist in energy management with operations in more than 100 countries, Schneider Electric offers integrated solutions across multiple market segments, including leadership positions in Utilities & Infrastructures, Industries & Machine Manufacturers, Non-residential Buildings, Data Centres & Networks and in Residential. Focused on making energy safe, reliable, efficient, productive and green, the Group s 130,000 plus employees achieved sales of 22.4 billion euros in 2011, through an active commitment to help individuals and organizations make the most of their energy. electric.com/company Schneider Electric One High Street North Andover, MA USA Telephone: Fax: Schneider Electric. All rights reserved. WP-CornellHotels-A4.BU.N.EN CC February 2012

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