SUMMARY
Ankit Tandon has been with OYO since 2015 and has been a part of CXO leadership team since 2016
OYO had recorded a revenue of $885 Mn in FY2019, but its monthly revenues has been reduced to $30 Mn due to the pandemic
CEO Ritesh Agarwal is now focusing on the recovery from Covid-19 to build a more sustainable and healthier OYO
Gurugram-based hospitality giant OYO has elevated its chief operating officer (COO) Ankit Tandon to the position of the global chief business officer to achieve profitability, while maintaining its operational performance and sustainability.
Tandon has been part of OYO’s CXO leadership team since 2016, prior to this, he has worked with McKinsey & Company and ITC Limited. He has also been the vice president of operation at OYO between 2015 to 2016.
Tandon’s current role will require him to lead the OYOs Global Business Services (GBS) and Business Performance Management (BPM) teams.
The role of GBS will be to integrate technology into processes and deliver efficiency in the finance, legal and HR teams across the organisation. The BPM team will work closely with individual market’s CEOs and their teams to help them learn about global best practices, external and internal benchmarks and in turn help them deliver their operating plans.
The BPM team will also help the Group CFO and the financial planning and analysis (FP&A) team with documentation, reports, and updates to OYO’s board and investors. Additionally, Tandon will be managing the global project management office (GPMO) responsibilities that he has been leading since October 2019.
Agarwal Pitches For A Healthier OYO
Commenting on his elevation, Tandon said, “I am extremely humbled and excited to take on this new role. This year has been challenging for business leaders across the globe and times like these enable companies to demonstrate their resilience and sharpen their focus. I look forward to continuing working with the incredible and passionate OYOpreneurs across the globe to ensure that OYO comes out stronger as the pandemic subsides”
OYO’s Group CEO and founder Ritesh Agarwal, said, “Ankit has time and again proved to be a valuable asset to our company and has been instrumental in conceiving and driving customer-first products that have resonated with customers, asset owners and employees and importantly created tremendous value for OYO. I am confident that he will continue the great work and make a significant contribution to the organisation in his new role.”
Agarwal also noted that the company is currently moving forward on its recovery from Covid-19 and building a “healthier and more focused OYO, which will be one of the most profitable technology-led hotel companies.”
Why The Pandemic Hit OYO Hardest?
The Covid-19 pandemic has been toughest for the travel, tourism, hotel and hospitality industry, which suddenly found itself in the middle of global travel restrictions with no sign of recovery until the vaccine arrives. OYO, in particular, has been in a tough spot as it has marked its presence in more than 800 cities across 80 countries. Beyond hotels, OYO also operates in holiday homes, business hotels, casinos and coworking spaces.
In the financial year 2019, OYO had recorded a revenue of INR 6,619 Cr ($885 Mn at current conversion rate), with INR 8,946 Cr ($1,197 Mn at current conversion rate) as expenses, leading to a loss of INR 2,332 Cr ($312 Mn, current conversion rate).
In comparison to FY2019, its revenue has grown 1.84x, with 1.58x increase in expenses with a 46% increase in losses.
With the pandemic, the company’s monthly revenue has reduced to $25 Mn-$30 Mn (INR 186 Cr to INR 224 Cr), according to chief executive of SoftBank Investment Advisers Rajeev Misra, who is also an investor in OYO. In September, he added that the company has reduced its monthly expenses by nearly $70 Mn (INR 523 Cr) from $100 Mn (INR 747 Cr) pre-Covid to $30 Mn (INR 224 Cr), and is achieving a break-even point.
The decline in OYO’s revenues have led to the salary cuts, furloughs and layoffs across all 80 countries it was operating in. Speaking at the ‘Ask Me Anything’ webinar hosted by Inc42 in June, Agarwal noted that the company first stopped all the controllable costs, and focused on the least amount of layoffs and also opted for furloughs.
Among the several choices that it had, Agarwal said he tried to choose the lesser evil. Talking about the new trends in the hospitality industry, he added that contactless check-in will be a huge opportunity.
