Cendant Announces Major Reorganization At Hotel Division

PARSIPPANY, NJ— Cendant Corp. announced it will execute a major reorganization of its Hotel Division aimed at enhancing the group’s service delivery to its franchisees. Stephen Holmes, chairman/CEO of Cendant’s Hospitality Division, which encompasses the Hotel Division, made the announcement internally yesterday afternoon at the group’s headquarters here. According to Holmes, the hotel group will be reorganized under six key areas of accountability—franchise sales, lodging operations (split into two separate groups), support services, hotel finance, and legal counsel. He said the process to revamp the hotel group was started several months ago, prior to the departure of Eric Pfeffer, who formerly served as president/CEO of the Hotel Division, but resigned from his post in September to spend more time with his family. “This is not a cost-cutting activity stemming from the Sept. 11 attacks; this idea evolved over time,” said Holmes, who noted he started to get more involved in the Hotel Division when news that Pfeffer would be resigning surfaced. The events were accelerated, however, by the terrorist attacks and resulting travel slump, he said. “We asked our franchisees where we needed improvement and took it from there. We have nine lodging brands, which is an unworkable organization for one person to manage,” he said. As such, the responsibility for all of Cendant’s lodging brands will no longer fall on one person’s shoulders. Surprisingly, the reorganization has grouped together the company’s lodging brands, which will be overseen separately by two executives— Joe Kane, president/CEO of Days Inn Worldwide and Bob Weller, president/CEO of Super 8. The two will each be charged with overseeing a handful of hotel brands, while keeping the individual identities and distinctness of those brands. Kane has been named group president/CEO to oversee the Days Inn, Ramada, Howard Johnson, and Travelodge brands. Weller has been named group president/CEO to oversee the Super 8, Wingate Inn, AmeriHost Inn, Knights Inn and Villager brands. “We felt it was important to group similar brands together and bring them closer to the decision-making process, to help them move forward,” said Holmes. “The goal is provide a more fluid format that will promote better customer service (for franchisees).” The Hotel Division’s other key areas of accountability have also been mapped out. Franchise Sales will be led by John Osborne, Hospitality Division chief sales & development officer, and Tom Bernardo, Hotel Division executive vice president, franchise sales & development. Doug Patterson, Cendant executive vice president, was named Hotel Division chief operating officer and will lead a newly christened Support Services Team that will include the Marketing Services, Franchise Services, Property Services and Franchise Administration Services departments. Ken Greene, who was named the division’s chief financial officer in June, will oversee a group consisting of Hotel Division finance, the Hotel Information Technology group, business development finance, a newly renamed International Services department and human resources. Joel Buckberg, who has served as the company’s executive vice president & deputy general counsel since April 2000, will continue to oversee the company’s legal groups that support the Hotel Division. The new organization will be implemented over the coming weeks, said Holmes. “As of now, its business as usual. As we continue to develop the positions under these guys, we’ll put them in place,” he said. “We will be announcing some additional positions in the coming weeks.” Holmes noted he expects the majority of the reorganization to be complete by the end of November or beginning of December. “This is sort of a return to an entrepreneurial spirit,” Holmes said.