Are the Starwood Management Changes Cause for Concern?

Mar 1, 2015

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TPG reader Dustin sent me a message to ask:

“Should I be worried about the Starwood shake-up? There’s a new CEO and one property I visit often is no longer a Westin, and I’ve been reading a few stories about SPG being let go from managing resorts.”

Recently Starwood ousted its CEO, Frits van Paasschen, who I’ve actually had the pleasure of meeting several times. I was impressed by him, but apparently Starwood’s board was not, as the word on the street is that Starwood wasn’t growing quickly enough, and Paasschen resigned.

This situation isn’t that uncommon or suprising, as publicly traded companies will always have pressure to grow and keep up with the competition, and I suppose Starwood was lagging behind.

Although the CEO of Starwood has resigned, it shouldn't be cause for alarm regarding the SPG program. Photo courtesy of Shutterstock.
Although Starwood’s CEO resigned, the SPG program should be fine. Photo courtesy of Shutterstock.

However, I don’t think this should be cause for alarm to SPG members. First off, Starwood Preferred Guest is a successful program with strong loyalty and connections to American Express. SPG really brings home the bacon for Starwood, and as it seems, the new CEO changes don’t have much to do with the loyalty program at all. In fact, the SPG program is still being run by the same management team.

So I think we don’t have much to worry about regarding points or the general health of the SPG program. From a broader perspective, I see this situation as being about growth and new resorts. I don’t foresee a lot of resorts fleeing the SPG program over a senior management change — it doesn’t seem to be that dire.

As a Platinum member, I’m not worried at all, and I don’t think you should be either.

If you have any other questions, please tweet me @thepointsguy, message me on Facebook, or send me an email at info@thepointsguy.com.

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