Image taken from Banyan Tree Tengchong in Yunnan
Have you stayed in a luxurious and exquisite Banyan Tree Resort before? Don’t worry if you hadn’t, I hadn’t too.
However, after reading Behind the Banyan — a business biography featuring Banyan Tree Holdings founder Ho Kwon Ping — I just might.
Written by journalist Aaron Low, this highly readable volume was part brand storytelling, part life story, and part business lesson. It documented Kwon Ping’s (KP) journey to building public-listed Banyan Group — a Singapore-grown brand with an impressive portfolio spanning over 70 hotels and resorts, over 60 spas and galleries, and 14 branded residences in over 20 countries.
While the biographical component narrating Kwon Ping’s (KP) life was pretty compelling, I appreciate how the chapters chronicling KP’s business ideas cleverly introduced management concepts prior to diving into his perspective. This is useful for readers who may not have an MBA or are unfamiliar with business strategies.
In this article, I will attempt to summarise the key sections of the book, plus add a little of my own perspective.
Rebellious Rabble Rouser
A rebel at heart, KP started off life as a journalist. Prior to that, he was a student activist at Stanford University, and got into trouble wiht the authorities there for various misdemeanours.
As a former journalist with the Far Eastern Economic Review (FEER), he ran into trouble with the Singapore government for some of his somewhat outspoken articles. It even got him thrown into the slammer for a time.
However, it was also thanks to his Singapore sojourn, it got him to reflect on his life and to “channel his energy and ideas into building something positive and permanent, even if it meant having to give up some of his youthful idealism.”
Although he was labelled a “banana” (yellow on the outside, white on the inside), KP never forgot his Asian roots. At the National University of Singapore, he met his sweetheart Claire Chiang (and later married her).
Avid travellers, they eventually found a small home on Lamma Island, off the coast of Hong Kong. The couple settled in one of the villages named Yung Shue Wan (the Cantonese name for Banyan Tree Bay) — this eventually became the name for their hospitality business.
Phuket Laguna — From Polluted Land to Paradise
After failing to grow his family business Wah Chang Singapore, KP wanted to escape from the stresses of running a business. With a friend’s recommendation to buy a holiday home in Phuket, he stumbled across a cheap piece of land at Bang Tao Bay.
“Up ahead on the beachfront, they started to see craters like large pockmarks on the smooth sand, filled with water that had an otherworldly cobalt-blue tinge.” The plot resembled a “desolate moonscape” but KP felt that they could do something with the land.
After much work— Bang Tao bay occupied an abandoned tin mine and was “hopeless, totally polluted, and useless piece of land” — KP managed to turn it into the Dusit Thani Laguna Phuket after much reforestation and rejuvenation.
This was the start of the Banyan Group.
Business Lessons from Banyan Tree
So what lessons could we glean from the hospitality magnate? Let me summarise key management insights and ideas from the book.
#1 Build an Authentic Brand
“A brand is essentially the distillation of all the important attributes of a product or service, into a single powerful image — almost like a tiny whiff of perfume is a concentration of many complex fragrances,” quoting from KP in the book.
With a focus on authenticity and credibility, the Banyan Tree brand was developed to encapsulate everything KP and Claire loved about their time in Hong Kong. “It was the romance of being in an isolated place.”
Beyond the provenance of its name, Banyan Tree focused on three areas:
- Coherence across multiple touchpoints, from the physical architecture down to the services on offer and the rooms visitors stay in.
- Building a strong service culture — everyone who visits must feel that they have been taken care of.
- Building credibility by caring for the external physical and human environment, including its commitment to sustainability and local community.
#2 Create a Unique Selling Point (USP)
With the tantalising title “The Day My Mother Went Skinny-Dipping”, you know that something good must be brewing in this chapter. And it certainly is!
Citing case studies from Starbucks (“3rd place”), Creative Technology (its eponymous Soundblaster), and milkshakes (how parents wanted something filling for children to last them till lunch), KP highlighted the importance of knowing what your customers truly want.
From his marketing research and insight, he discovered his primary market of wealther Baby Boomers wanted an exclusive resort experience. And this culminated into having private pools that cannot be peeked into for his Banyan Tree villas.
#3 Niching Down and Partnering for Growth
During its aggressive growth years, Banyan Tree went from opening a resort in the Maldives (Vabbinfaru resort in 1995) to setting up two dozen properties across the Seychelles, Australia, India, China and Mauritius.
Focusing on their niche — wealthy tourists looking for intimate holiday experiences — they focused on their strengths, namely “catering to people who wanted a thoughtfully curated getaway” and “selecting locations that would offer a perfect backdrop, like the Maldives.”
They also forged strategic partnerships with local companies in each market that fulfilled specific needs, are of compatible values, and with the assumption that it may fail. This helped to protect the group when things go south.
#4 Riding the Chinese Elephant
With the towering snow-capped Jade Dragon Snow Mountain as its backdrop, Banyan Tree’s Lijiang resort is one of its most iconic in China. The entire experience was carefully designed to give a sense of place, transporting guests to China that existed before skyscrapers, smog and endless traffic existed.
Expanding into China was made possible through an understanding of Chinese local culture. Instead of copying Western designs, it drew inspiration from Lijiang’s rich cultural and architectural history.
KP also cleverly enlisted his wife Claire to lead their China forays. Her deep appreciation of Chinese history and culture — right down to reciting Tang dyanstry poetry — helped the company endear itself to locals!
#5 Forging Cultural Unity in Diversity
To bring together such as vast and diverse employee base, KP focuses on three tenets of Banyan Tree’s Culture:
- Appreciate diversity as an integral part of the company’s culture
- Show empathy and care for associates and guests, embedded in the slogan “I Am With You”
- Commit to sustainability and protecting the environment
Tapping on the power of brand storytelling, KP and Claire helped to instil the values to new hires. They also made it a spoint to break the glass ceiling for both Asians and women, appointing their first Thai female general manager in 2012.
#6 Leadership through the “Courage of Mind”
In KP’s own words, “there is a transcendental and inspirational aspect of leadership, which is quite different from management.” This is embodied in how a leader touch the lives of those they lead, inspire them, and demonstrate how its done by your own example.
With zen-like mindfulness approach, a true leader should detach themselves from their decisions. They should earn (rather than demand) the respect from their team, lead with empathy, and put their egos aside. Grooming and succession planning is also key. (See Level 5 leader for more.)
#7 Fighting the Disruptor
Considered the nightmare of incumbents in the hospitality industry, Airbnb’s rise has resulted in a dent in the hotel industry.
Unfazed, KP adapted with a segmented market approach. He listed some of his properties on Airbnb and other OTA (Online Travel Agents) websites. With his focus on the high-end luxury travel market, Airbnb did not pose an existential threat to the group.
#8 Innovation, the Banyan Tree Way
Citing the example of the Sony Walkman and how it revolutionised listening to music, KP shared that Banyan Tree was built on innovation.
This drew back to their first properties on Phuket, which did not have a beachfront. To circumvent this, they decided to built 30 villas. And to overcome the absense of a beach, they brought the water to the guests — each villa has its own small pool.
They also built spas that had a distinctly local flavour for its properties, anticipated guest needs rather than react to them, and eschewed innovating for innovation’s sake.
#9 Values Beyond Profits
I first found out about the Banyan Tree Gallery — the retail arm of the group offering indigenous crafts from its various markets — through my work at the National Heritage Board (NHB).
Back then, I oversee a team handling the Museum Shop @ Banyan Tree, an initiative hatched by a former CEO and Claire Chiang involving creating merchandise inspired by the art and artefacts displayed in NHB’s museums.
In the book, I learned how Claire first launched Banyan Tree Gallery to support the women at Yasothon village in Northern Thailand. Today, there are over 60 Banyan Tree Galleries over the world, opening up new markets and creating livelihoods for thousands of village communities globally.
Other than helping local communities, Banyan Tree is also committed to the environment with a wide range of sustainability measures.
#10 Managing a Family Run Business
With both KP and Claire in their 70s, succession planning is inevitable for the family-run business. Their children Ren Hua (eldest son), Ren Yung (second daughter), and Ren Chun (youngest son) are either currently involved or will be joining the family businesses.
To avoid family politics from clouding the business, KP made it a point to follow the three Ts:
- Trust: Through both formal and informal processes, all three of KP’s children were involved in the business. They were brought along to visit the properties, and often had discussions to thrash out decision-making processes.
- Transparency: To avoid bias and ensure long-term growth, the family combine family ownership with efficient third-party management. In Banyan Tree, for instance, the management team (which includes KP’s children) are led by their CEO Eddy See. Being public-listed also ensured that there were proper checks and balances in its management processes.
- Transition: Here, KP follows the philosophy of keeping the pool small. This will avoid the potential for conflict and mismanagement.
#11 Gritting Their Teeth through COVID
Like many hospitality businesses, Banyan Tree suffered during the COVID-19 pandemic. It had to release 15 percent of its global workforce (last in, first out basis), with management taking substantial pay cuts.
The global lockdowns also forced the company to do a rights issue to raise S$50.4 million to pay down its debts and sustain operating expenses.
Fortunately, the company survived and did not shut down. Following the crisis, it learned the importance of being more agile, reducing its liabilities through flexible staff deployment, and building financial buffers.
Conclusion (Plus a Discount)
Towards the end of the book, KP shared how a mix of ingenuity, grit, and hunger are hallmarks of entrepreneurial success. And yes, luck also matters, as shared by Jim Collins and Morten T Hansen in their book Great by Choice. Being able to react to both good and bad luck matters.
To get your copy of the book, do visit BookSmart here. Simply quote “BANYAN” to get a 5% discount. Highly recommended!
Many thanks to Thomas Tam for the review copy provided by @Booksmart!
