42 Degrees - Business from a different angle

At the age of 60, he is fit and tanned. His suit is hand made and his hands are perfectly manicured. He has a share of a family fortune worth the best part of £400m, according to The Sunday Times. With his easy aristo charm and cut-glass accent, Sir Rocco Forte should be at peace with the world and his position in it – somewhere near the very top of the tree.

But, as he sits talking in his modern but strictly functional offices near London's St James's Square, it soon becomes apparent that he is far from satisfied with his current state. Something is eating at him, goading him, driving him to prove himself at a time of life when many others would be eyeing retirement and perhaps slowing down.

You don't have to look far to discover what it might be. Ten years ago, as chairman and chief executive of Forte plc, the company founded by his father in 1934, Sir Rocco was responsible for more than 800 hotels, 1,000 restaurants and almost 100,000 employees in 50 countries around the world. Then Granada mounted a hostile takeover bid, broke it up and, according to Sir Rocco, sold off the component parts for less than they paid for it.

It was an act that felt to him like corporate vandalism, "a useless exercise", that left him traumatised and depressed. "The only time I think of the past is when I am asked about it but I didn't want it to happen, I was very upset," he says. "This was a business my father had started and it was part of my life. I had great plans for it to become one of the major international hotel players."

To have his business taken away and broken up by complete strangers was clearly a heavy blow. But, if you ask Sir Rocco if there is a better or fairer way to run business than through the market, he replies that there isn't. "The reality of the market, not just the stock market but market forces generally, is that it makes managers manage their businesses better," he says.

Sir Rocco was always a high achiever, but now he seems to be living life with extra intensity, perhaps in an attempt to heal the wounds left by the takeover. Just look at the way he spends his spare time. Most men of his age fit in the occasional round of golf. Sir Rocco represents the UK at triathlon, a particularly arduous combination of running, swimming and cycling.  He usually competes at the Olympic distance – a 1500 metre swim, 40km bike, and 10km run. But last July he completed an Ironman race which included a 3.4km swim, 180km bike, 42km run.

So, at the end of the working day, he likes nothing more than to go home to a spartan, almost brutal regime of physical exercise. "Training can take up to 20 hours a week," he confesses. "I might do a six-hour bike ride on Saturday, then swim two miles and run for three hours on Sunday. On weekdays I do a one-and-a-half-hour swim or run before work."

Ask him why, and you might expect a spiel about the joys of participation or staying healthy. You would be wrong. He says that it's not the taking part that matters – it's the winning: "I've passed middle age, so perhaps it's an unconscious effort to fight ageing. But I'm not the sort of person who does things simply for pleasure. I want to be top in my category, otherwise I don't get a kick out of it." By his own admission he won't be comfortable or be able to enjoy his achievements until he is at the top.

Exactly the same applies to his current enterprise, Rocco Forte Hotels. Ten years ago you could have got a Forte bed for less than £50. Today, if you want to sleep with Sir Rocco it'll cost you a minimum of £300, close on £1,000 if you want the 'Presidential' treatment. He's expensive, but when you stay at any one of his 14 ultra-luxurious hotels scattered throughout Europe, you can be fairly certain of an intense desire to anticipate and satisfy your every whim.

In fact, service lies at the heart of his business philosophy, which is based on the idea that what really matters in commerce is revenue. Cost control and emphasis on the bottom line are secondary to income, he argues: "I was very conscious when I started this business that would be my main focus. Costs come way down the list because, unless you have a healthy top line, no matter how well they are controlled, you will never make a profit."

Although cost control is clearly important, Sir Rocco says that he has learned the hard way the damage a cost culture can do to a service business. "If I focus on cost, everyone else is going to focus on cost," he says. "It happened in my old business, which I was trying to change. I realised that I was talking about service but the divisional managing directors rang up managers and talked about wages percentage and gross profit percentage and not about service at all. The managers concluded: 'the boss talks about service but what he really wants is cost saving above all else'."

He visits all his hotels three or four times a year and gets involved in as much detail as possible – even down to issues such as the best position for the servery in a new Presidential suite – but Sir Rocco accepts that it is almost impossible to micromanage service levels himself.

Instead, he has put in place systems to promote a service mentality – primarily through incentives. "We actually measure service delivery as well as financial delivery," he explains. "We have a third party service audit twice a year and half a general manager's bonus is based on scores he achieves in these surveys. Then each department in a hotel is 'bonused' against the scores they achieve on the audit. It's a big incentive to get it right."

Sir Rocco is more than half way to his stated aim of having 25 hotels in the chain, quite an ambition when you consider that each one must have an absolutely prime position in a major city and come at price that will allow him to stamp a new identity on it.

He says he is pleased with the way things have turned out. "I am happy in what I am doing now, and I particularly like the more 'hands on' approach which a small company enables me to have." Is he happier than if he had held onto THF? He's not sure. "To say that I am happier (than before) is very difficult; I do not know where we would have got to with the old Forte business if we had continued to run it."

Sir Rocco admits he doesn't have a clear exit strategy from Rocco Forte Hotels in mind. But you can't help feeling he's in it for the long haul and he will not, cannot stop, until he is at the very top once more.