Social Entrepreneurs: Taking On World Problems
Fri July 5, 2013
At Cambodia Hotel, The Workers Are The Boss
Originally published on Tue July 9, 2013 11:37 am
This story is part of NPR's ongoing series about social entrepreneurs — people around the world who are dreaming up innovative ways to develop communities and solve social problems.
If you walk into the lobby of the Soria Moria hotel near the famous Angkor Wat temple in Cambodia, it probably won't strike you as a bold experiment in development and democracy. The Soria Moria, in the booming town of Siem Reap, is a three-star hotel with 38 rooms that is more cozy than fancy. It looks like a lot of hotels that cater to tourists: There's wicker furniture in the lobby, a rooftop bar serves margaritas, and the tile floors are spotless.
But now ask the people who staff the Soria Moria to describe their jobs, and you will begin to understand why this hotel is different:
"I work here as a receptionist," says Real Marideth, sitting behind the wooden counter. "I am the owner also."
"I am food and beverage manager," says Eam Chandy, arranging buffet platters in the hotel's restaurant. "And the hotel owner."
And talk to Chhan Voang, the doorman who is standing like a soldier just inside the lobby. "I am one of the owners of this hotel as well," he says through an interpreter.
All 29 full-time employees co-own the Soria Moria. Think about it: Cambodia's a country where most people never got past primary school. They have grown up under dictators, in effect. Yet now the receptionists at the Soria Moria, the room cleaners, the bartenders and the office assistants have all become part owners of this corporation. Sim Sakana, who works at the reception desk, says becoming an owner has changed the way she works.
"For me it's very important," she says. "Because we feel like this is our hotel. We try to be the best of the best."
Still, the employee-owners have discovered that it's one thing for someone to tell you that you're in control, and it's another to truly believe and behave like it.
The social experiment at the Soria Moria hotel is the brainchild of the Norwegian couple who founded it in 2007. They came up with the idea partly as an antidote to the side effects of booming tourism in Siem Reap, as visitors from around the world began flocking to the ancient temples. Investors from Korea, Japan, China and other countries were building hundreds of hotels in a town that was a sleepy backwater only a decade ago, with dirt roads and houses made of palm fronds. Those hotels were providing urgently needed jobs, but they often required employees to work long hours for little pay or benefits.
"The thing is, I don't like to talk down other hotels. But I know there are cases where employees are being exploited," says Kristin Hansen, 33, the Soria Moria's co-founder. Hansen and her husband bought a long-term lease on an existing hotel after they fell in love with Cambodia. They changed the name to Soria Moria, which comes from a Norwegian fairy tale about the search for a castle and happiness. Hansen says they wanted their hotel to be a model of the right way to treat employees.
"Sometimes they don't even pay employees; they just bring in poor people from the countryside to basically work day and night for food and accommodation. No salary," Hansen says. "There are many, many horror stories like that here."
An executive from the Cambodia Hotel Association says he has heard similar stories. But, he says, most hotels treat employees fairly.
Hansen and her husband wanted to treat their employees better. So they began paying double time after eight-hour shifts; they provided almost four weeks' paid vacation, paid maternity and paternity leave and generous health insurance. They have also paid for staff to attend college and graduate school.
Then, a few years ago, Hansen and her husband started thinking about selling the hotel and moving back to Norway. They realized there would be no guarantee that a new owner would treat the Soria Moria's employees the same way.
"And this started in my mind to form an idea that by the time we leave, we must make sure we hand over this to our staff, to our employees," Hansen says. "Because they helped us build the business, they should have this. Not somebody else."
Majority Ownership Turns Over To Staff
So three years ago, Hansen called the staff to the dining room.
" 'Would you guys like to be partners in the business?' That's what I said. There was kind of no response, and like, I think they thought we were joking. And then they got most of all scared," Hansen recalls. "Most of them are from farmer families; they've grown up living under the poverty line, living on less than a dollar a day. So to suddenly become a business owner, it's a big step."
Hansen and her husband pushed the employees to take that step. They turned over majority ownership on May 1, 2011.
Here's how the ownership system works: Hansen and her husband formed a new company on behalf of the employees, the Soria Moria Educational Development Program. Then they essentially gave that company 51 percent ownership in the hotel. Employees earn shares in the new company based on a formula.
Full-time employees earn 1 ownership point for every dollar's worth of salary they make. They earn 2 ownership points for each month they work at the hotel. Managers also get bonus points.
That means a room cleaner who has worked at the Soria Moria for years could accumulate as many ownership points as a supervisor who has worked at the hotel for a shorter time. All the employees elect the board of directors, which in turn appoints the top managers.
Day to day, the Soria Moria runs pretty much like a normal hotel: The managers tell employees what to do.
But the staff is paid more than average for Cambodia — between $75 and $300 a month. And the employee owners get part of the profits. This past spring, each employee received between one and almost three months' extra salary from profit sharing.
Hotel guests eating dinner in the dining room say they don't know the details of the Soria Moria's ownership structure, but they love the hotel's spirit.
"You can see they are not exploited, and they are working for their own. And that makes lot of difference," says Joachim Pilzecker, from Germany.
A British guest loves the hotel so much, he wrote a song about it.
"There's a hotel you'll never forget," Mike Bishop croons. "They all work together for times you will treasure, Soria Maria forever."
A Transfer Of Power
Hansen and her husband have discovered that it's one thing to give people power on paper; it's another thing to help people who have grown up poor and powerless to start behaving like they have power.
Some employee-owners, for instance, talk about Hansen as if she were a benevolent monarch.
"Kristin treat us like a family. Kristin love us and trust us," says Phhov Tol, as she mops a guest room. "Kristin always told us that everyone is the owner of this hotel, it's not her, so everyone can make decision." Tol pauses. "I'm not quite sure I'm smart enough."
According to the hotel's ownership rules, the employee-owners vote on any decisions that involve spending more than $1,000 — such as buying a new refrigerator or building a swimming pool.
And sure enough, when the staff started voting on decisions a couple of years ago, they basically rubber-stamped whatever Hansen said.
"Cambodian people, they don't think they have the right to make decisions," says Ny Sandayvy, an interpreter who helped with this story. "Especially women. Because before, they never make their own decision. Most of the decision is making by their parent or husband," Sandayvy says.
Learning To Make Decisions
Hansen saw this problem, too, so she sent the staff to Possibilities World — a management training center in Siem Reap — to learn how to make decisions.
During a recent afternoon session, about a dozen of the hotel's employees gathered around a conference table. "Today's going to be really important," said trainer Noem Chhunny. "We're going to learn accountability, responsibility to the whole team, not just individual success."
Over the next few hours, Chunny led the group through a series of games, using props like ropes and hula hoops, designed to teach teamwork and trust.
One of the hotel's receptionists said she was learning not to get angry and defensive when guests complain, but to focus instead on solving their problems. A waiter in the hotel restaurant said he had learned that he should face conflicts instead of running from them.
"Last week I have a fight with a cook. Until now, I don't talk to him, and [he] doesn't talk to me," said Yuk Chhork, through an interpreter. "But now I realize that I have to change."
Later, Chhork followed up and talked things over with the cook.
But if there was one moment when the staff realized they do have control, it was probably their confrontation with Hansen over the staff vacation trip.
Every year since they bought the hotel, Hansen and her husband would close down the hotel for four days during slow season, and they would take the staff to a resort — all expenses and their salaries paid. But last year, Hansen was worried they couldn't afford it because the world economy was shaky, and the hotel's reservations were down.
So she called the entire staff to the dining room where she first asked if they would like to take over the hotel. And Hansen urged them to hold off on the trip.
Yin Sochen — the hotel's bright young bookkeeper at the time — stood up and told his colleagues that even though business was tight, the trip is the emotional high point of the year and the hotel could survive it. He urged the other employees to vote against the hotel's founder.
"I am not afraid of Kristin," Sochen says today. "I stand up and I object to the idea because we are based on the majority. Lots of people behind me and support me."
And then one of the women — Lous Dalish, a bartender — spoke out and urged her colleagues to vote against Hansen, too.
"I am one of the owner. So I have the right to choose. I have confidence to express my ideas, to make decision," she says.
The staff voted to take the trip. And the hotel did fine.
Hansen acknowledges now that when the employee-owners voted down her proposal, she had mixed feelings. "I was a bit upset ... but I was happy as well. Actually, it made me really proud, I think, because I'm thinking like, they need to stand up for something," she says. "And there you go, they did it."
Soon, the employees will really be in charge. Hansen and her husband have decided to leave Cambodia later this year and move back to Norway to be with family. So the employees will face a big decision: Should they sell the hotel and walk away with the profits? An appraiser said they could probably make at least $300,000. But some employees support a more ambitious idea: They want to expand and take over a second hotel.
ROBERT SIEGEL, HOST:
It's ALL THINGS CONSIDERED from NPR News. I'm Robert Siegel.
AUDIE CORNISH, HOST:
And I'm Audie Cornish. We've been profiling people around the world who are dreaming up innovative ways to solve social problems. Today, we head to Cambodia. The owners of a popular hotel there have decided that the best way to help their employees is to turn the hotel over to them. And they're finding that it's one thing to tell people they're in control and it's another to get them to act like it. NPR's Daniel Zwerdling reports.
DANIEL ZWERDLING, BYLINE: So, walk into the lobby of the Soria Moria hotel in the town of Siem Reap, it's a three-star hotel, 38 rooms. Nothing fancy but there's wicker furniture in the lobby and it's cozy. And the tile floors are spotless. You look over palm trees from the rooftop bar. So far, pretty standard but now you're going to hear the difference between this hotel and probably every one you've ever seen. Just ask the employees to introduce themselves. Some spoke through an interpreter.
MARIDETH: My name is Marideth and I work here as a receptionist. I am the owner also.
ZWERDLING: You're an owner of the hotel.
MARIDETH: Owner (unintelligible).
CHANDY: My name Chandy. I am food and beverage manager and the hotel owner.
CHHAN VOANG: My name Chhan Voang, bellboy.
ZWERDLING: You're the bellboy, bellman.
VOANG: I am one of the owners of this hotel as well.
ZWERDLING: All 29 fulltime employees are owners of this hotel. Now think about it. Cambodia is a country where most people never got past primary school, yet, now the receptionist of the Soria Moria...
(SOUNDBITE OF RECEPTION)
UNIDENTIFIED GUEST: Could we get our room key, please?
SIM SAKANA: What is your room number?
ZWERDLING: ...and the women who clean your room and the bartenders and the office assistants, they've all become part owners of this corporation. Sim Sakana is at the reception desk. She says becoming an owner has changed the way she works.
SAKANA: For me it's very important because we feel like this is our hotel. We try to be the best of the best.
ZWERDLING: If you'd come to Siem Reap 10 years ago, you would've found a sleep backwater. A lot of houses were still made of palm fronds. But then the outside world discovered the temples.
UNIDENTIFIED MAN: So, welcome to Angkor Wat. And right in front of us this is the most beautiful temple in Cambodia called Angkor Wat. So let's walk up on this big step.
ZWERDLING: Our guide says, you want to see how the tourist boom has transformed things? So we hop into a tuk tuk. That's like a motorized rickshaw.
CHON CHIAYUT: My name is Chon Chiayut and I born in Siem Reap.
ZWERDLING: And we head down the road that connects the airport to the main part of town. Wall to wall development.
CHIAYUT: About 10 years ago on both sides you see rice fields.
ZWERDLING: Rice fields, so this was farmland.
CHIAYUT: But now replaced with all these concrete buildings and especially hotels and restaurants. At nighttime on this road I feel like I'm in Las Vegas sometimes.
ZWERDLING: And as this part of Siem Reap became more like Las Vegas, one of the hotel owners became more concerned.
KRISTIN HANSEN: The thing is I don't like to talk down other hotels but I know there are cases where employees are being exploited.
ZWERDLING: Her name is Kristin Hansen. She's 33 from Norway, but she and her husband fell in love with Cambodia. And back in 2007 they bought a long-term lease on this hotel and they renamed it the Soria Moria. The name comes from a Norwegian fairytale about the search for happiness. They wanted their hotel to be a model of the right way to treat employees. Some hotels treat their staff like slaves.
HANSEN: Sometimes they don't even pay employees. They just bring in poor people from the countryside to basically work day and night for food and accommodation, no salary. There are many, many horror stories here.
ZWERDLING: I raised this with an executive from the Cambodia Hotel Association. He said he's heard those stories, too, but most hotels treat employees fairly. In any case, Hansen and her husband treated their employees better - generous overtime, almost four weeks vacation paid, three months maternity leave paid, good health insurance. Then three years ago, Hansen and her husband started thinking about selling the hotel and moving back to Norway. And then they thought, wow, what if the new owners don't treat the employees the same way? And they decided...
HANSEN: By the time we leave we must make sure we hand over this to our staff, to our employees. Because they've helped us build the business, they should have this, not somebody else.
ZWERDLING: Hansen called the staff to the dining room and she said...
HANSEN: Would you guys like to be partners in the business? That's what I said. There was kind of no response and, like, I think they thought we were joking. And then they got most of all scared. Most of them are from farmer families. They've grown up living under the poverty line, living on less than a dollar a day. So to suddenly become a business owner, it's a big step.
ZWERDLING: And Hansen and her husband basically pushed the employees to take that step. They turned over majority ownership to the staff May 1st, 2011. And here's how the ownership system works. Hansen and her husband formed a new company on behalf of the employees. And then they essentially gave that company 51 percent ownership in the hotel. Each employee earns shares in the new company based on a formula.
HANSEN: As simple as possible.
ZWERDLING: Hansen prints out a spreadsheet to show me. You get one ownership point for every dollar's worth of salary you make. You get two ownership points for every month that you work here.
HANSEN: And then as they climb up their ownership will be higher because they've worked here longer.
ZWERDLING: Which means that a room cleaner who works here for years could get as many ownership points as a manager who's worked here less. Now, day to day, the Soria Moria runs pretty much like a normal hotel. There's a management committee and they tell employees what to do. But they pay the staff better than average, between 75 and $300 a month. And employee owners share the profits. Just this spring, they each got between one and almost three months extra salary. And hotel guests in the dining room can tell you what that means.
JOACHIM PILZECKER: You can see they are not exploited and that makes a lot of difference.
ZWERDLING: Joachim Pilzecker and Esther Ingvers are staying here from Germany. They love the spirit of this hotel.
PILZECKER: The friendliness of the people.
ESTHER INGVERS: The concept of helping people to make a living on their own.
(SOUNDBITE OF SONG)
MIKE BISHOP: If you're heading for sea every year.
ZWERDLING: Another guest wrote a love song about it.
(SOUNDBITE OF SONG)
BISHOP: There's a hotel you'll never forget. They all work together for times you will treasure, Soria Moria forever.
ZWERDLING: Still, Hansen has discovered that it's one thing to give people power on paper. It's another thing to help people who've grown up poor and powerless to start behaving like they have power. I talked about this issue one morning with one of the cleaners. Phhov Tol was mopping the floor in a guest room. How many rooms do you have to clean today?
PHHOV TOL: Ten.
ZWERDLING: Ten rooms.
ZWERDLING: And how many have you already finished?
ZWERDLING: I asked her, what does it mean to be part owner of this hotel? Now, the rules say that the staff votes on decisions that involve spending more than $1,000. Should they buy a new refrigerator, build a swimming pool?
Some people might wonder, why should a house cleaner in a hotel be able to help vote on decisions.
TOL: (Through Translator) Kristin treat us like a family. Kristin love us and trust us.
ZWERDLING: Tol talked about Hansen like she's a monarch. But here's my question, why should a housecleaner like you help make these decisions?
TOL: (Through Translator) Kristin always told us that everyone is the owner of this hotel. It's not her, so everyone can make decision. I'm not quite sure I'm smart enough.
ZWERDLING: And sure enough, when the staff started voting on decisions a couple years ago, they basically rubber stamped what Kristin Hansen said. As we left Tol to finish her cleaning, my interpreter suddenly turned to me.
NY SANDAYVY: Cambodian people, they don't think they have the right to make decision.
ZWERDLING: Her name is Ny Sandayvy. She said, when you ask Cambodians why should you be able to help make decisions, some don't understand your question, especially women.
SANDAYVY: Because before, they never make their own decision. Most of the decision is making by their parent or husband.
ZWERDLING: Kristin Hansen saw this problem too and she figured, okay, let's train the staff to make decisions.
NOEM CHHUNNY: So good afternoon. So welcome back again. Welcome to week four.
ZWERDLING: The worker owners of the Soria Moria are taking management training at a center near the hotel. It's called Possibilities World. On this afternoon, a dozen hotel employees arrange their chairs in a circle under a slow twirling fan. The trainer is Noem Chhunny.
CHHUNNY: Today's going to be really important. We're going to learn accountability, responsibility to the whole team, not just individual success.
ZWERDLING: Over the next few hours, he leads the group through a series of games, you know the kind, they use props like ropes and hula hoops. They're designed to teach teamwork and trust. And then, everyone shares what they've learned. A waiter in the hotel restaurant says he's learning to face conflict head on.
YUK CHHORK: (Through interpreter) Example, last week I have a fight with a cook. Until now, I don't talk to him and he doesn't talk to me. But now I realize that I have to change.
ZWERDLING: But if you can point to one moment when the staff realized we do have some control, it was probably their showdown with Kristin Hansen over the staff trip. You're laughing about this now, but were you upset at the time?
HANSEN: I was a bit upset, yeah, but I was also be happy as well.
ZWERDLING: Every year since they bought the hotel, Hansen and her husband would close down for four days during slow season, and they take everybody to a resort for vacation. But last year, Hansen worried they couldn't afford it. The world economy was shaky, reservations were down. So she called the entire staff to the dining room again.
That's where Hansen first asked if they'd like to take over. And she told them we should postpone the staff trip. Then, the hotel's bright young bookkeeper stood up. Were you at all afraid of disagreeing with Kristin at this meeting? I mean, she founded this hotel.
YIN SOCHEN: No. I am not afraid.
ZWERDLING: Yin Sochen told his colleagues, we realize business is tight, but this trip is the emotional high point of our year. We'll survive it. And he urged them to vote against Kristin Hansen.
SOCHEN: (Through interpreter) I stand up and I object to the idea because we are based on the majority. Lots of people behind me and support me.
ZWERDLING: And then, one of the women spoke out. She's the bartender now. Lous Dalish, she urged her colleagues to vote against Hansen, too.
LOUS DALISH: (Through interpreter) I am one of the owner. So I have the right to choose. I have confidence to express my ideas, to make decision.
HANSEN: And I had the vote and they all went against me. I was like, yeah. Actually, it made me really proud 'cause I'm thinking, like, they need to stand up for something. And there you go. They did it.
ZWERDLING: The staff took their trip. And the hotel did fine. And now, Kristin Hansen and her husband have decided they're leaving Cambodia later this year. They're going back to Norway to be with family. So the employee owners will really have to be in charge. And here's one of their next decisions. Should they sell the hotel and walk away with the profits?
An appraiser said they could probably get $300,000. But some employees are backing a more ambitious idea. They want to expand and take over a second hotel. Daniel Zwerdling, NPR News. Transcript provided by NPR, Copyright NPR.