Homely and welcoming in his attitude, Karl Serracino led me to a boardroom where we could “chat to our hearts’ content.” And we did just that: chatted and chatted well beyond the time allotted for this interview. Many were the inroads and byways of our discussions which made us understand each other better.
Karl Serracino’s title of Head of Procurement, Corinthia Hotels Ltd (CHL) made him the ideal candidate to clarify my first impulsive query about the difference between procurement and purchasing. “In a nutshell, one can say that Procurement and Purchasing are different but intrinsically related functions, necessary for the optimum acquisition of goods and services.
“Procurement is a strategic function that focuses on long-term goals, value creation, risk mitigation, supplier relationships and contract compliance.
“Purchasing, on the other hand, is a tactical function that focuses on order costs, placing and receiving orders, and transactional activities. So, purchasing is a subset of procurement.
“Procurement would involve the research and strategy, whilst the purchase would be the implementation, the end-step or the actuation of procurement.”
So, was I correct to understand that Karl did not purchase anything? “You’re right. I do not place any orders, and I do not buy. I start a process by researching and working on the feasibility of a project, and then I present it to the Chief Financial officer and subsequently the Chief Operations Officer.
“Just as an example, let us say we are ordering paper. Our Marketing consultants would choose a specific brand of paper, though, of course, I may also offer my suggestions or feedback. But the decision to purchase that specific type would not be mine. However, I would have to examine many aspects, such as pricing, negotiation, budgets, availability of shipments to any destination, sanctions, if any, and other considerations. In certain decisions, we join forces with other quarters of the company.
“So, you are right, procurement is not equivalent to purchasing.”
I dared ask Karl his age. He was not perturbed at all: “I’m 52. And I know what you’re thinking. You may be wondering how long I have been working with Corinthia.” I pretended I did not have that in mind but invited him to nonetheless guide our readers through his Corinthian journey.
Karl grinned and mumbled that it would be a long story. And indeed, we did chat for a good time, but this is the gist. Karl intended to begin a university course in Electrical Engineering. That was in 1987, but because of a sudden change in the syllabus, the course was postponed for a few months. “My father encouraged me to fill the waiting time with a part-time job.” And Karl did just that; he joined Corinthia and started working at the Jerma Palace. “I had no intention of joining a hotel, but after a few weeks working there as a cashier, Louis Camilleri, who subsequently was my boss and mentor, informed me that a computerisation project was about to be launched. It was one of the first hotels in Malta to be computerised. I joined the bandwagon and that was a life-changing experience.”
From then, Karl moved to Cost Control, and he informed his father that he wanted to continue working, though promising that he would continue studying. “I studied Management and specialised in Project Management, where I obtained a distinction.”
Meanwhile, he was regularly promoted and in 2000 he worked assiduously on the Y2K project where systems had to be thoroughly reviewed. He still prides himself that his suggestions on the software selection were accepted and followed, and subsequently rolled across the Group
“They then asked me to work on systems and policies and procedures at the Corinthia Beach Resort. It was tough but so rewarding.”
From 2002 to 2012, CHL embarked on an expansion programme, which culminated in the opening of the Corinthia London Hotel. Those were vibrant and hectic times and full of excitement. A group worked on programs; each with his area of operation. Karl was head of Project Back-of-House. Others had Front-of-House, or Reception area etc. Karl stopped briefly and recollected: “We were an excellent Pre-Opening team. We started installations at Corinthia Palace, Budapest, Prague, Libya, Lisbon, Sudan, MIA Airport Restaurants, Antwerp, Egypt, Dubai, St Petersburg, London, all 5 Malta hotels… We would implement, train, open and support.”
There were times when Karl would sorely miss his family since that work involved long spans abroad. It was a powerful learning curve, experiencing different markets and achieving high service levels. “My adrdenaline spiked!”
After the London experience, Karl migrated away from Corinthia to a Real Estate Group of Companies, which did enrich him with different backgrounds. However, in 2016, Karl had the opportunity to rejoin Corinthia, which he willingly did.
“We started beefing up the Procurement Department. Currently, we are working on standards, practices, and standardisation of products. Let’s not forget we also operate third-party hotels, so we must show even more clearly and assertively that we are conscious of costs and expenditures. We have extra particular reasons to prove ourselves and demonstrate our professionalism.”
Karl’s story showed a symbiosis between a growing company and the simultaneous growth of a person within that company. I queried what happened to a growing company and new entrants. What happened to the company’s ethos or spirit? Did the many new entrants imbue the Corinthia culture? Or did Corinthia run the risk of losing its own identity? Was this a litmus test of survival? “It is essential that Corinthia retains its ethos and spirit. This is now becoming more difficult since many could be bent on embracing what is good for their pocket but may give secondary or tertiary importance to what is suitable for the company. One has to ensure that we instil and retain in new entrants a sense of belonging to an established Corinthian culture, even at the cost of self-sacrifice in terms of work, dedication and effort. It is even more critical to make the best choices. A what’s-in-it-for-me mentality pervades modern society, but it is essential to overcome this damaging attitude.”
I asked Karl what are the essential requisites/qualifications/talents that a Director of Procurement should possess? “For a procurement position, a bachelor’s degree or equivalent in a relevant field is typically required, as well as a minimum of 7-10 years of relevant experience, five of which must be in management and operations. Undoubtedly, multi-tasking and organisational skills are also required. The Operator must be seasoned in this area and able to direct the work of other team members, especially in the hospitality sector.
“I would also add that excellent computer and analytical skills, as well as an understanding of developing a vendor program, sourcing, and procurement process, are required, especially regarding project management.”
Based on what Karl was saying, I queried whether he was a perfectionist, analytical and an optimist by nature. “By nature, I am a perfectionist in what I do, which sometimes can be rather challenging. Luckily, through age and maturity, one gets to realise when to let go of certain restraints. But in our industry, working in the luxury segment, one needs to provide the ‘guest’, who is King, with a unique and memorable experience, rather than just standard products and services that are commonly found elsewhere across the counter or in non-luxury fora. Am I analytical? One needs to strike the right balance between optimum quality and price sensitivity, since every decision I take must also make business sense and be result-and-quality-driven. Optimum service and profitability are the motors of all my job-related activities. I also consider myself as a realist and an optimist and strive to ensure that a project and its related tasks are completed successfully within the designated timeframe, no matter what challenges arise along the way.”
When one rises the ladder rungs, one is bound to carry a world of past experiences. This could, however, sometimes translate into a negative habit of micromanaging. Was it difficult for Karl to avoid the temptation to delve deeper and border the confines of micromanagement? Karl conceded that “at times, it can be difficult to avoid that temptation. However, it is essential to delegate tasks and responsibilities to team members and provide all the necessary support and trust in them to complete the assigned task(s). But that should not mean abdicating or non-interfering when mistakes or wrong assumptions are made at lower levels. One has to manage well these circumstances. As Shakespeare’s Hamlet would say, ‘There’s the rub.’ ”
Strategies and policies are established at higher or the highest levels. Karl is active in this area but with who does he liaise most in this exercise? “I mainly formulate the department strategy in collaboration with the Chief Financial Officer since Procurement falls under the ‘Finance’ umbrella, and co-ordinated with the Chief Operating Officer, with the involvement of the Head of Operations & Quality. Since specific products are used commonly by all hotels and are thus branded, there is also the involvement of Marketing Directorate, where strategies and ideas are set as a Standard and accordingly rolled out operationally.
With regards to policies and procedures, recommendations are forwarded to the Chief Financial Officer in consultation with the Internal Audit or any other relative department for the necessary review and to recommend/revise policies accordingly.
Naturally, policies are not only set, but also reviewed for several reasons, such as revision of outdated policies (mainly practices and technology) that might put the Company at risk, and old policies that may be non-compliant with new laws and regulations, thus ensuring that the policies are consistent, effective and not cumbersome to the operation, thus keeping Corinthia up to date with regulations, technology, and the industry’s best practices.”
Karl is busy all through the year but there are periods which are busier than others. “I would say the most active is during the preparation of the budgets for new development for the Operating Supplies and Equipment section (OS&E) with pre-established timeframes, trying to juggle between the many new developments we are currently working on, especially when the concepts and locations are so varied.
As a standard practice, I have a schedule at the start of the year with timelines that cover corporate agreements renewals or reviews, attending of fairs/conferences/workshops, working on feasibility studies, concept ideas, operations support, and Back-Of-House systems support.
At procurement, we are often busiest when costs need to be aligned while maintaining optimum standards and service flow on various specific Group projects.”
Karl had mentioned his family earlier in this chat. Would he care to say a few words on the subject? “I am blessed with a closely-knit family. My wife, Roberta, has been an excellent companion, friend and wife, and a most caring mother. I am also blessed with two children. My eldest, Emma, is 20 and is studying Occupational Therapy, whilst my son, Jan, who is 15, is about to start Accountancy. I thoroughly enjoy their company and admire them. They are smart and harbour good values.”
When we were chatting, Karl casually mentioned trekking. I was quite surprised since, for some reason or another, I did not imagine him to be an exercise-oriented individual. I was so wrong! He relaxes most when cooking, reading, cycling, walking/trekking, and playing paddle. And to round it up, he loves gardening. “I have more than 30 fruit trees which I assiduously attend to. And I also grow various greens.”
We ended with that homely touch, which seemed to relax Karl for a short while. Then he consulted his online diary and smiled. “Another busy day ahead.”