Le Mat history

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The Le Mat European social hotel chain – empowering, networking and franchising small social entrepreneurs

This historical case study was presented at the EQUAL conference in Warsaw in May 2006. For up-to-date information see: Le Mat

The Le Mat project’s main lesson regards creating a dynamic network – the innovative process of evolution from a small social firm’s good practice towards a quality trademark and a network of small social enterprises in the hotel sector. Interest may be focused on the main steps of the process of setting up a network, on the organisation of the network system, and on the quality standards and trademark.

Some key points are:

  • good practice must be distilled; it takes time to re-engineer the main quality features and facility management elements to be developed and replicated
  • the small social entrepreneurs must be involved in developing the trademark
  • developing the network is a cultural learning process which needs time and support because of the innovative approach
  • the economic and social partners’ function is very important and has to be exercised.

Social franchising has to be supported as an innovative practice and then maybe extended in many sectors. It possible to set up strong social quality oriented networks of enterprises within a European approach.

An inspiring model

The project brought together 24 partners, mostly small organisations. They included:

  • small social firms in many different areas – they had to experiment with the whole process of working towards hotel management
  • people with disabilities and their families
  • hotel business organisations and business experts
  • local communities and authorities
  • banks, funds and business partners

The partners wanted to find out whether the mechanism of franchising could be used to help small social enterprises to compete more effectively on the market, without losing their essential qualities. Linked to this, they wanted to discover how to organise efficiently as a network, and how to start the process from the bottom up. The DP decided to experiment in one trade sector – the hotel business – in order to learn the franchising process and to set up a sustainable network organisation of enterprises with a quality trademark. The starting point was the distillation process of the Hotel Tritone in Trieste, which has operated successfully since 1991 under the management of a small type B social co-operative[1].

What are the reasons for its economic success and the good results it has achieved as regards including people with disabilities? Research discovered and described two complete productive schedules, one regarding the hotel business and the other the inclusion in the work and in the firm’s management team of people with disabilities and severe mental illnesses. This led to the writing of the Le Mat Hotel – a first manual.

The replication process

The next important steps were to start the replication process:

  • to find the buildings
  • to prepare the business plans
  • to train the entrepreneurial group in both the productive processes
  • to plan, design and start up the network and to train the entrepreneurs as nodes of the network.

This was a long and difficult process, which is still going on throughout the Le Mat network. The main steps in the process were:

Learning the rules of the property game

The search for the buildings to accommodate the hotels. The hotel business is based on selling rooms – the more rooms you can sell, the easier it is to reach your breakeven point! The location of the hotel is important, and the property market affects the balance between costs and revenue. The DP discovered abandoned public buildings, private owners unable to find a productive use for their property and the terrible power of banks and real estate funds. It faced the same conditions as all small and medium enterprises and hoteliers. More than 40 public and private buildings were visited, but only few were usable for the standard Le Mat Hotel – a small (30 rooms), 3-star hotel offering breakfast. The whole research process is still going on with new partners (banks and funds) but now it is informed by a very precise knowledge as to the necessary features. Social entrepreneurs have learned to act on the market.

Building the network nodes

Step-by-step setting up the entrepreneurial groups in the different towns. All the groups decided to start a new business with very precise and innovative criteria. Nobody had ever managed a hotel before and nobody had ever started such a complex business from the bottom up. The project had fixed many single steps to be carried out by all the members of the partnership. From the beginning the people with disabilities and severe mental problems had to be completely involved. Obviously the problems were very different in the north and in the south of Italy but the process of identifying the many common barriers strengthened the groups and empowered the people. It was a very powerful learning process; learning by doing and learning from each other. Ten entrepreneurial training courses were carried out, which created more than 10 different business plans. People travelled to the other towns, learning from each other and becoming the active nodes of an enterprise network.

Creating the central point

Parallel to the local business development work, the network had to be structured. Le Mat the franchisor had to become the central node of the network. The DP wanted the central structure also to be the result of a bottom-up networking process. A training course was run involving the 10 small enterprises and the experts who could support the process of replicating the know-how. At the end of the 200-hour course, which was held in five different towns from the north to the south of Italy, the Le Mat network was formally set up and a central office was established in Rome.

Spreading the word

Action 3, carried out in 2005 by Le Mat, whose members are social firms and experts (hotel managers, social entrepreneurs, architects and designers), was the first test of the network organisation. It involved more than 30 contacts in different areas of Italy with local authorities wanting a Le Mat hotel, experts wishing to learn about universal design and accessibility in the hotel sector, social entrepreneurs wanting to set up a hotel or to join the network with their hostel, B&Bs, and small hotel owners looking for a network. In addition European social entrepreneurs came up asking how to expand the network in other European countries.

From the start, Le Mat was challenged with the task of being a network structure of enterprises with many different nodes all around Italy and many different expectations and ambitions of the different nodes.

The EQUAL project has raised the anticipation of an innovative growth method for small social enterprise and now the new Le Mat network has to be able to draw in the results of the experimentation and to increase the development.

In comparison to the beginning of the project, the nature of the important partners is definitely changing. Today the leading energy of the growing network comes from hotel associations searching on their members’ behalf for quality-oriented standards and processes, particularly as regards accessibility, and from local policy makers and authorities searching for quality in tourism and innovative social entrepreneurs.

Generally the small social enterprises are too weak to act as autonomous and ambitious nodes of the network. These firms still need to be guided. A network needs strong nodes.

The manual

Contents of the Le Mat manual
Le Mat Manual 1: The hotel franchising of social entrepreneurs
Why, what, who and how

Summary
Introduction
Le Mat
Le Mat – the hotel franchising of social entrepreneurs
The historical background
Franchising
A Code of ethics
Franchising in the EU law and in Italy
Social franchising or franchising in the social economy
Worker co-operatives and Italian type B social co-operatives
Le Mat - The hotel franchising of social entrepreneurs: two production schedules
The Le Mat system/network: association, affiliation, services, operational collaboration
How to become a member of Le Mat Association
How to become an affiliate of the Hotel network
Services
Operational collaborations

Le Mat Manual 2: Workers’ and entrepreneurs’ self-determination and self-management, careers and empowerment in Le Mat social enterprises
Introduction

The second production schedule: Members/workers/entrepreneurs in hotel management
A few words about the methods involved
The small and medium-sized hotels: different qualities for different guests
Workers, members, entrepreneurs
The benchmark model: the worker co-operative
Development of entrepreneurial capabilities and creation of a managing group
The person responsible for the hotel and the group
Insertion and training in the working group of a Le Mat enterprise
Some criteria for the training/insertion processes
Looking for staff
Reception
Insertion
Wages and work grants
Training
Checking people’s work
Working in a fine place: method and style
The group: an enterprising community
Another suggestion: gender empowerment, equal opportunities
Final notes on the creation of a new labour and enterprise culture

Le Mat Manual 3: The Le Mat hotel
Introduction

Its mission
Our guests
The basic formula
Locations and structural standards
Accessibility
The Ecolabel
The quality of Le Mat hotels
The product: a) The parking area, b) The hall, c) Lifts and corridors, d) The bedroom

Le Mat Manual 4: Exercise: how to prepare a budget
Summary

Introduction
Starting up a hotel: some preliminary indications
Hotel Associations and Hotel Classifications
How to find a suitable Le Mat hotel
The competition
The demand
Revenues
The rates policy
The maximum rate and other rates
Other revenues
Breakfast
Telephone
The service
The price
How to achieve quality hospitality
Booking
Arrival at the hotel
The check-in
The check-out
Complaints
Breakfast: a special service offered by Le Mat hotels
The organisation
The number of persons employed: a) manager/ess in charge, b) reception group, c) staff responsible for the floors, d) breakfast room staff, e) bar staff
Staff characteristics and functions: a) floor staff, b) breakfast room and bar group, c) reception group, d) The manager/ess, e) somebody else
Bar
Costs: room / breakfast / bar / telephone / laundry / commissions / staff / general / cleaning / upkeep / energy / miscellaneous
Gross operating profit
Rent
Sources of funds

Key aspects

Horizontal mainstreaming

is becoming more and more intensive towards the end of the project. The network is growing but it is a hard job to strengthen the nodes (both at the periphery and at the centre). They need many different support actions and are geographically distanced. All the regions have different laws and the support team has to be very specialised and flexible. The main methodology used is participative planning, which involves spending a lot of time with people. But more and more other tourism networks such as the Responsible Tourism Worldwide Network or the Social Tourism Network are becoming active partners of the Le Mat network.

Vertical mainstreaming

is going on mainly towards hotel and tourism organisations, regions, banks and co-operative development funds, because the development of the network needs initial support as the small enterprises are not able to pay for the network costs. This also takes a lot of time because network organisation is an innovative methodology and expectations are frequently more oriented towards strong and centralised organisations. There is a lot of curiosity but also a lot of suspicion and not much flexibility. Moreover, public support policies are not appropriate for network enterprises, as they prefer to fund the vertical growing process of an enterprise. A change is needed in order to promote networking strategies. In Italy franchising is now becoming more and more interesting but it is a very profit-oriented methodology where the franchisor is a private firm selling the know-how. A social franchisor is a little different and needs different support. Le Mat is now discussing and planning social franchising with the co-operative movement and the associations of people with disabilities.

Local development

the empowerment process of the small social enterprises is delivering its first results for local development, as they become the motors of local innovative partnerships in responsible and sustainable tourism. More and more the small social enterprises apply their innovative knowledge locally, creating participative planning actions. This is one of the main added value aspects of the project.

Other EQUAL principles

  • Partnership – was very important, because it was a big DP working in many different areas of Italy and it was difficult to act together. The strong experimental character of the project and the innovative result the partners wanted to achieve kept the group together.
  • Transnationality – was important too because it was well structured and centrally co-ordinated. Le Mat was born with a transnational character and will develop as a transnational network.
  • Innovation – the project was highly innovative as regards the process and the expected results. It started from the idea and need to develop an innovative method of growing and qualifying the social economy – a network strategy like franchising applied to the social economy.
  • Empowerment – was one of the main principles of the DP’s three years of work: empowering people with disabilities, excluded people and small weak organisations in the market through a branding policy.
  • Sustainability – sustainability is a key factor defining the quality standards of the hotels, as regards both the impact on local development and the economic performance of the social firms.
  • Gender mainstreaming – most of the social entrepreneurs of the Le Mat network are women. Women understand and enact more easily a network growth strategy.

A new business methodology

Social franchising is a very innovative business networking methodology. It cannot work through a strong franchisor simply selling the know-how. Rather, it is necessary to set up a complex network organisation which can empower and qualify the nodes and act as a network. A special European programme would be useful in understanding if it is a good innovative practice to qualify and strengthen social economy. Le Mat is a first example, among others. It would be good to ask these pioneers what type of support they would find useful.

Contact

DP name: Albergo in Via dei Matti numero 0
DP ID: IT-IT-S-MDL-203
Renate Goergen
Chairperson
Le Mat
Via Gino Capponi 176
00179 Roma
Italy
Tel: +39 335 778 0682
mailto://info@lemat.it
mailto://renate.goergen@fastwebnet.it
Italian website: http://www.lemat.it
English website http://www.lemat.coop

Notes

[1] Italian Law 381/91 defines type B social co-operatives as “cooperatives integrating disadvantaged people”. The law covers the following categories of disadvantage: physical, psychic and sensory invalids, drug addicts, alcoholics, minors and offenders. During the 1990s, a large number of type B co-operatives integrating people with mental illness (such as Hotel Tritone) were created as a result of the reform of the psychiatric system, which shut down psychiatric hospitals.