There are going to be surprises no matter how well you know a company. Learning about them early is challenging because employees, even at the highest levels, are reluctant to share troubling information. Learning what you need to know requires rigorous questioning while conveying in a compelling way that you absolutely want people to speak openly.

A CEO coming in from the outside needs to emphasize getting a good fix on the full range of business operations, the strengths and weaknesses of the leadership team, and the nature of the culture.

Chris Nassetta, when appointed to the helm of Hilton Hotels in 2007, made vital discoveries by travelling to a large number of hotels to talk with employees. The company had just been purchased in a high-stakes leveraged buyout by Blackstone for $26 billion, one of the largest LBO deals ever. For his first three months, Nassetta travelled to Hiltons in the United States and abroad, talking to workers on the front lines, such as bellhops and cooks, in addition to hotel managers, and questioning customers. He discovered that, as he put it, “the culture was a wreck.” Among many problems, the company’s standards for service were subpar. To kick-start rapid improvement, he instituted a requirement that every company manager spend three days working in a hotel, at the front desk or in the kitchen and doing housekeeping. He also implemented an employee evaluation process, emphasizing quality of customer service provided. Those were early steps in a many-years-long process of creating a culture of excellence, which, as we detail in Chapter 7, drove a remarkable turnaround in Hilton’s fortunes that made the LBO one of the most successful in history.

Flush off of that achievement, Hoplamazian turned his attention to a feature of Hyatt that was the reason he’d decided to make his big leap. In his months as interim CEO, working closely for the first time with the Hyatt executive team, he realized that “there was something so special about the culture of Hyatt. I couldn’t quite put it into words, but nobody was showing up just to punch a clock.” He felt deeply that he’d had “a true emotional experience of joining the Hyatt family.” Now he decided to delve into the power behind that strength of connection he felt as fuel for growing the company.

In the year ahead, he surveyed the broader employee base as well as customers and learned that “we didn’t have that same emotional connectivity with our guests.” Or with Hyatt colleagues out on the front lines. Hoplamazian dedicated time to meeting with many of them. Through his own and others’ probing into the colleague experience, he realized that the company evaluated employees largely based on their compliance with an elaborate set of rules and that “we tracked success in our hotels by compliance with a list of brand standards, not guest feedback.

Though Hilton had grown considerably in recent years, largely through acquisitions, including DoubleTree, Embassy Suites, and Hampton Inn, it had taken on a heavy debt burden, and the stock was trading at a lower multiple that its competitors’. But the fundamental problem, Nassetta understood, was the company’s culture. “There was no culture of innovation,” he said. “It was more a culture of do it at a relatively slow pace and do it the way we’ve always done it.” Changing that would be a daunting challenge.