Skift Take

Marriott’s next CEO is almost certain to come from within the company’s own ranks.

Marriott CEO Arne Sorenson on Monday lost a nearly two-year battle with pancreatic cancer. While the hotel industry mourned Tuesday over the death of such an enigmatic figure, it was only natural to begin wondering who might take over for Sorenson as leader of the world’s largest hotel company. Marriott offered no further details on the succession plans beyond that a new CEO would be announced within the next two weeks.

The list of the favored candidates is likely small and internal.

Sorenson may have been the first outsider to take the top job at Marriott, but he built a relationship with the company for decades — first as an outside attorney for the company during its spinout of its Host real estate division and then joining Marriott as in-house counsel in 1996.

Sorenson’s own path to the executive suite shows the company favors someone with established ties to the company, and that’s why the short list is likely down to two candidates and potentially a wild card or two.

But this isn’t a job promotion the winning candidate should take lightly. There was somewhere close to 730,000 people wearing a Marriott badge around the world pre-pandemic, Sorenson said in a 2019 speech. But the hotel industry of 2021 is a shell of its former self, with tens of thousands of staffers out of work across many companies.

Hotels continue to operate at fractions of their pre-pandemic vacancy rates. Even China, which Marriott expects to return to 2019 performance levels the quickest, faced a recovery setback earlier this year due to rising case counts and new travel restrictions.

The hotel industry’s recovery appears largely banked on vaccine distribution around the world hitting enough of a critical mass to reopen international borders and revive cratered business lines like corporate travel and conventions.

Stephanie Linnartz

Stephanie Linnartz — Marriott’s group president of consumer operations, technology, and emerging businesses — joined Marriott in 1997 after a three-year stint in sales and operations at Hilton.

She along with Tony Capuano — group president of global development, design and operations services — was tapped earlier this month to fill in for Sorenson on day-to-day operations while he underwent more aggressive cancer treatment.

Until Sorenson’s successor is announced, Linnartz oversees Marriott’s international lodging division as well as the company’s legal, human resources, communications, and public affairs sectors on top of her existing duties.

Watch a Video Interview With Stephanie Linnartz from Skift Forum Asia

Those longstanding roles are why Marriott’s board could find her to be the best-suited for CEO.

Marriott Homes & Villas is one of the new business ventures Linnartz oversees, and it has some analysts heralding her for pushing Marriott to be more like Airbnb. The Homes & Villas platform is Marriott’s entrance into the short-term rental market, and it has grown exponentially since its 2019 debut. The brand had more than 16,000 listings in early December — up from 2,000 listings when it launched nearly two years ago.

Linnartz’s embrace of innovation and agility to key divisions like the Marriott Bonvoy loyalty program is why she should be seen as a frontrunner.

Her oversight of Bonvoy includes its increased focus on leisure travelers during the pandemic. Recognizing not all members were checking into a hotel during the crisis, Bonvoy’s Eat Around Town program lets members earn points by dining out at local participating restaurants.

Linnartz also introduced at Skift Forum Asia last year the Work from Anywhere with Marriott Bonvoy program, the company’s take on the work-from-hotel trend during a global health crisis keeping most people away from their typical workplace. Marriott’s program was unique in that it offered a range of options, from day passes to use a hotel room as a de facto office to multi-day packages that also included supervised activities for children.

Her forward-thinking vision is clearly valued by the company, given her co-leadership duties with Capuano. But her eye for disruption may be what’s necessary for a traditional hotel company to thrive in an era of competitors like Airbnb or Expedia.

“We want to be involved in the travel journey beyond the four walls of a hotel,” Linnartz said at Skift Tech Forum in 2019. “Travel is a big space. There will be a lot of winners at the end of the day. The winners will be those who think about the guest experience holistically.”

Tony Capuano

Capuano joined Marriott in 1995 on the company’s market planning and feasibility team before going on to lead the company’s full-service development efforts on the U.S. West Coast and Canada. He later expanded his oversight to global development.

Capuano oversees Marriott’s U.S. and Canadian lodging division as well as the finance department on top of his existing responsibilities as part of his co-leadership duties with Linnartz until Sorenson’s successor is announced.

His oversight of building up Marriott’s traditional lodging brands is clearly a success: Marriott’s nearly 500,000-room development pipeline at the end of the third quarter last year was the biggest in the industry. The company was even able to return to profitability by that same quarter despite the pandemic delivering a catastrophic blow to the greater hotel industry.

Capuano acknowledged in a 2018 interview with Skift the potential for growth in the all-inclusive resort segment, an area Marriott significantly expanded within earlier this month with a 19-property deal in Central America and the Caribbean.

Like other Marriott initiatives, the all-inclusive strategy is aimed at capturing the dominant leisure traveler force behind the pandemic recovery.

“We are seeing leisure-transient lead the recovery. That’s not for a moment to suggest we aren’t seeing green shoots in business travel and even a bit of small group, but leisure transient has a pretty good head start,” Capuano told Skift earlier this month. “This allows us to continue to build on that leisure-transient recovery.”

Wild Cards and the Must-Have Blessing

While it may seem like Linnartz’s or Capuano’s job to lose, there are still plenty of in-house candidates. One of the most public-facing is Leeny Oberg, Marriott’s chief financial officer who appeared alongside Sorenson for the company’s quarterly investor calls since taking on the role in early 2016.

Oberg joined the company’s investor relations division in 1999 and has since held a variety of positions, including chief financial officer of the company’s Ritz-Carlton division.

There is also the chance someone from completely outside the Marriott orbit takes over for Sorenson, but that is seen as an extreme longshot.

Sorenson was the first non-Marriott family member to take the helm of their namesake company. His longstanding professional relationship with J.W. “Bill” Marriott, Jr. is widely seen as what made the so-called outsider a viable contender for CEO when Bill stepped down in 2012.

Marriott himself appeared to signal his approval of the entire leadership team earlier this month when Sorenson officially stepped back from some of his leadership responsibilities.

“Arne has built an excellent executive team,” Marriott said. “I have every confidence in Stephanie and Tony and the entire leadership team to continue to implement our strategy and to not miss a beat running day-to-day operations.”

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Tags: Arne Sorenson, coronavirus, coronavirus recovery, marriott

Photo credit: Marriott is expected to announce a new CEO within the next two weeks. It's highly unlikely the board will look far for a successor to the late Arne Sorenson. Kgbo / Wikimedia

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