Ski industry executive sits down with Pique for his first local media interview in two years

The last time Vail Resorts CEO Rob Katz was interviewed by the local media was in August 2016, when the Colorado-based company announced its $1.4-billion friendly takeover of Whistler Blackcomb (WB).

Needless to say, after WB’s first official season under Vail Resorts’ banner, Pique had plenty of questions for the ski industry executive. In Whistler last week following the wrap of the ski season, Katz sat down with the publication’s editorial team to answer questions that touched on a wide array of topics, including the local backlash against his company, how he plans to address the major challenges facing the resort, as well as whether he does, indeed, ski in jeans. (He doesn’t … anymore.) We also threw in a few questions suggested by the community on social media.

The following interview has been edited for length and clarity.

Pique: How do you think Whistler Blackcomb’s first official season under Vail Resorts went?

Rob Katz: This was a season that had a lot of challenges to it. We knew going into the first year there were going to be challenges, and I think we saw them, in terms of aligning the (software) systems we have … I think that was an issue. Aligning that with all the different systems that Vail Resorts has added more complexity and more intensity to the team at Whistler Blackcomb.

And then the cultural piece: bringing together two very proud cultures and really trying to set a baseline for how we move forward together, and why that makes sense and why that’s important. That was also challenging.

Even if Vail Resorts had done everything perfectly this year, I think it still would have been a tough year. There were a lot of places where we fell short and I think it made it only that much more difficult. That said I couldn’t be more proud of the Whistler Blackcomb team and the experience they delivered when you look at all the things they had on their plate.

I feel like we’re now at a spot where we can pivot and transition as we look to the next season, where there’s more support we can provide.

Pique: What improvements are you looking to make for next season?

RK: I’m not sure we, as a company, did a good enough job really communicating and taking the time to engage, in some cases with the employee base here, and in some cases with the community, to talk more about the whys of what was happening. We knew how important it would be, that if we were putting in new systems, and so many new systems, that the resort opened and operated. I think there was sometimes maybe a myopic focus on getting that done and not as good an effort on the support and communication that we might’ve provided at the outset.

In terms of getting the software systems aligned, is that completed and expected to go more smoothly next season?

RK: Absolutely. By the time we get to next season, we feel the major stumbling blocks: the passes that didn’t work when you got to the lift, long lines at the ticket window, people not knowing where to go or what to do to actually get up on the hill, all of those things we think will be in the past.

Pass Products

Pique: Speaking of passes, there was lots of frustration around the elimination of the parent pass, which was an affordable skiing option for many local parents. Would you consider bringing that pass back in its original form?

RK: That was a product that we don’t have at any of our resorts, and the challenge was that it was a transferrable product, and so much of how we orient our systems and approach is for one pass to one person. So we looked at that and understood there was a connection to it, so we ended up grandfathering in (2016-17 pass holders for this past season). For those folks, we made it much better because we actually provided two passes that are not transferable so both parents could ski at the same time.

Our goal is to ensure that the mountain does remain accessible to our local and regional community so that we are bringing new people into the sport. One of the things we launched here that we have at our other resorts is Epic School Kids, where we’re giving kids, K through (Grade) 5, five days of free access to the mountain. From what we’ve seen in our other communities, that really helps to bring out the more casual skier and really gets kids in the sport, along with their parents.

Pique: Would you consider bringing back the 3-Day Edge Card, another popular option for regional skiers?

RK: There’s two pieces of feedback that we’ve heard around them: One is some concern that (the public) wasn’t able to buy their Edge Card during the season. That’s something we don’t think is constructive for the sustainability and protection of the resort in the long term. Our company has made it a primary focus to get people to buy their skiing before the season begins, and the reason is that we are faced with some tough challenges as we look to the future. The weather is getting much more variable and with what’s going on with climate change, I think resorts have two obligations: One is we need to be doing the right thing for the environment … But we also know that that’s not going to solve the weather issue on its own, so we need some business strategies. So what we’ve done at Vail Resorts is (asked) how we create stability in the face of that weather challenge, so getting people to buy in advance is a pretty important piece.

The other thing we heard is that five days is too many, and there are people who would like to buy less than that. Another strategy is to try and get people to purchase more skiing because that provides more commitment and security to the resort and the community. But we’re continuing to listen to that feedback and we'll see if there is something else we can do for the more casual skier.

Preserving the culture of Whistler

Pique: Some of these decisions, taken as a whole, have left the impression that the destination skier is being emphasized at the expense of the local and regional skier. Can you effectively balance the needs of those two markets?

RK: I think we have to balance those two business goals. Whistler Blackcomb is a huge resort and it cannot be successful without a very strong connection to the regional and local market. I think we can do that and also balance our goal of getting people to purchase their skiing in advance so that the community, our employees and the resort has security. That’s something that we have to work through, and I will admit there are many things in Whistler that are different than what we have at our other communities. And we have different products here, so we have to continue to learn to say, ‘What is the right formulation of that?’ We need to figure out a way to make sure that that regional market, the Vancouver skier, absolutely feels welcome and has that strong connection. We cannot lose that.

The good thing about our company is we are very comfortable with change, so that means we are comfortable with making change where we think it will help, and we’re also comfortable, if something’s not working, in making change to make it better. That’s something that, over time, the community here I think will begin to appreciate with the approach we take. We’re not stuck.

Pique: What efforts are you taking, if any, to preserve and promote Whistler’s distinct culture?

RK: Whistler’s importance to Vail Resorts is because of its uniqueness. If you go to any of our guests anywhere in the world, the thing they will tell you immediately is that they appreciate the differences between our resorts. No one wants our resorts to be the same.

Candidly, we don’t hear from our guests at these resorts that it reminds them of other resorts. Now it’s true though, and we can’t take credit for this, that Whistler is a very successful ski resort that had its makings well before Vail Resorts was ever involved. That ski resort is now facing the challenges that many of our resorts are: ‘Wait a minute, there are so many people here.’ Or ‘Whistler has expanded so much more than I expected.’ ‘When I was here 10 or 20 or 30 years ago, it was totally different.’ And that’s a community conversation that the resort needs to be very much a part of as to how we do (preserve the culture) collectively. The way we protect it is by ensuring everything we’re doing is looking to maintain what makes Whistler special: the big-mountain skiing, the community, the town, the unique flair and brand position of this resort—because if we did change it, it would only be to our detriment.

Pique: What are the company’s long-term plans with the World Ski and Snowboard Festival, Crankworx, and other WB-produced events?

RK: From Vail Resorts’ perspective, we really see that as a resort-community decision. All of our resorts have different events, and that’s not something we try to centrally address.

It’s really about what the right thing is for the community and the resort, and we really leave those decisions as part of the unique component (of those communities).

The Workforce

Pique: We believe one of the reasons people are feeling this shift at Whistler Blackcomb has to do with the level of customer service the resort provides and the loss of that personal touch with an American company at the helm. How are you striving to improve on that?

RK: We can’t change the fact that we’re an American company, but I do think that if we want to stay successful … we need to ensure we’re doing a great job of listening and attuning ourselves to what’s locally important. I do think that as a company we have some experience with that, because each of our resorts in the United States, they don’t think of themselves as the same. They all have unique issues and unique brands and they want to be engaged with in a way they feel like is helping support what their goals are. I think our company is set up to do it, and I also think last year was a very challenging year to have that fully come through.

In terms of having a personal touch, we have to make sure that we are empowering the leadership and the full management team of this resort, who are incredible people, and the vast majority of whom were the exact same people who were here two or three years ago. They need to feel like they can lead and inspire and engage and pull out the passion of everyone who works at Whistler.

Last year was a tougher year for it, but we did see, as the year went on, all of a sudden a lot of our scores from our guests continued to improve. To the point where, in some cases, they were in fact leading the company in guest satisfaction as we got further into the season. (This is) no different than if you were opening a new restaurant or hotel, with all these new systems; the first few months are really tough and everyone’s kind of off-balance. As we dialled in, I think we really saw that increase.

Pique: A lot of that customer service piece comes back to the fulfilment WB employees felt or didn’t feel in their jobs. Your internal employee survey scores were some of the lowest in the company this year, several top executives have left the company, and we’ve heard complaints from staff about certain restrictive policies, like the two-drink maximum at staff events, for example. What lessons have you taken from that employee feedback and how will they be applied to improve the employee experience next season?

RK: There is no doubt that we got a lot of feedback from our employees, and the level of engagement, the scores on a lot of those surveys were absolutely not where they needed to be. That’s something that very much falls on Vail Resorts in terms of owning how we make this pivot and have people feel empowered and that their passion can really come out at their job. Hard to do when there’s change and when everything is moving around. But what gives me a lot of confidence is that, at our other resorts, (how) we’ve made great strides in our engagement scores is by listening. The way you get people to feel like they have a bigger stake and more control is by listening to their feedback and responding. It doesn’t mean you’re going to address every issue and every concern, but we can start to build the track record. It may not solve everything but people start to see that progress. This past year was a year where people felt there was a lot of moving backwards.

I will also say: We have a strong view around safety … and it is true that sometimes we get criticized about that, and that’s true in the United States and that’s true at our other resort communities. I’m not sure that’s something we’re going to move off of. There’s a way for everyone to have fun and have a safe environment for everyone. That ultimately creates the best work environment, and we’ve shown that. But it takes time to do that. I wouldn’t expect anyone who works at Whistler Blackcomb to immediately have confidence in Vail Resorts. That’s something that we have to earn.

Renaissance

Pique: How committed is Vail Resorts to fulfilling the original vision of the Renaissance plan?

RK: What we’re committed to is making a significant investment and improvement in the resort, but whatever we would do, especially on the size and scale of Renaissance, has to be based on what the community wants.

One of the biggest announcements we made is our capital plan for next year. No matter what capital plan we announce, some people like it, some say we didn’t do the right thing. But this really was a locally owned decision and process by the people who actually know the mountain the best. The feeling at the community and the resort was that a waterpark was not the best first step in that Renaissance plan, and we heard that pretty consistently from a lot of different places. And so we’ve said, mountain-first. We didn’t say we’d never do a waterpark. I think we could, but we don’t feel like we have to do one.

We’ve got some other things we need to focus on before that, too, like housing, for example.

Housing, affordability and staffing challenges

Pique: Speaking of housing, what are you doing to help with Whistler’s ongoing housing shortage?

RK: Housing is the biggest challenge that all of our mountain resorts face, due to a whole confluence of factors that are not just about mountain resorts.

It is this … global issue in very successful cities and communities pricing people out of the market. I do think it is incumbent upon the entire community to make an investment to make it affordable and possible for people to live there or these communities won’t be sustainable. It’s not a choice. We have to do that. Our company has to be a leader in that. We’ve spent a lot of time talking about where that’s possible to do it here, and I would say the funding for a new investment in affordable housing is totally there. It’s just a matter of where the right spot is, what is the regulatory process is to get there, and that’s ongoing as we speak. I’m pretty confident we will have something to talk about here shortly—because we have to.

Pique: Whistler Blackcomb COO Pete Sonntag has previously mentioned a specific housing project WB was considering, but no details have been announced. Can you give us any information on that?

RK: A couple years ago our company came out and said we’re going to make a $30-million commitment to affordable housing. And it’s not that we would build all the housing that was needed by all communities, but we would be making investments, signing leases and doing everything we could to get this done. I would admit that it takes a lot longer than just having the money. There are so many things that go into making these affordable housing projects come forward.

Taking the time with this community to get the right project, (one) that will have full support, is important.

Pique: Can you describe more concretely what you’re actually doing in terms of housing? Are you having conversations with, for instance, the RMOW?

COO Pete Sonntag: What I alluded to before is still in process. Nothing has really changed. We’re not backing off of that and we’re still forging ahead. We have a couple parallel tracks that we have to work through, and the RMOW is one of those. We’re definitely in conversation with them. We want to make this happen as soon as we possibly can, so it’s not a question of desire on our part. We’re doing everything we can, but we acknowledge there’s a process that we have to get through.

Pique: What are your priorities in terms of housing? Are you looking to build additional staff housing or are you considering something in the community at large?

RK: A little bit more of our focus at this point is on staff housing, but I do think this issue is broader than that. That’s just where we have identified an opportunity and where we’re putting our resources right now, because that’s something we see can happen. But that’s not the only thing. It’s incumbent upon the community, all the businesses in the community—everyone contributes to this issue.

Pique: How does the company plan on addressing some of the other major challenges our community is facing right now in terms of rising cost of living and our staff shortage?

RK: We have a responsibility to be aggressive on making increases to (employee) compensation. I think we have to prioritize where the biggest needs and gaps are. But our company, every year, allocates, in addition to normal inflation increases, a significant amount of money to helping address compensation issues, and we have to continue to do that. People have to feel like they can make ends meet or we’re not going to be sustainable.

As a broader community, like housing, we need to come together to talk about all the other pieces. How do we make sure that we have the support, the services, the non-for-profit community, all the different pieces that make for a sustainable community? We need to be part of that and we’re absolutely focused on it.

Pique: In respect to skier visits, is there a magic number that you want to hit, or is it simply the more the merrier?

RK: I would state the obvious, which is the more, the less merry. The more people we try to put on the mountain, the less quality that experience is going to be, and people don’t enjoy that. That’s true not only on the mountain but with all the transit and infrastructure pieces of the community. It’s incumbent upon us, collectively, to help manage that. We see that as a very important component. It’s also why we’ve said, ‘Hey, those people who are willing to buy their skiing in advance, that’s an important constituency for us because it creates that long-term stability for our business and the community.’ To be honest, we struggle with someone who wants to show up on a powder day and get a very discounted price, because we don’t know how many powder days there will be. We try and orient the company around that strategy to really incentivize people to buy (in advance).

There’s no magic number. I don’t have a magic box where I type in a specific number (of visitors). But I will say that I always worry when people say, ‘We don’t want more people,’ because that sometimes goes the other way. Business that don’t want to grow often start to slide backwards. The key is to invest in the infrastructure and in the community.

The easiest way to get people not to come is to make the experience bad. Our job is to be thoughtful about growth, but make the infrastructure changes so that we don’t turn this into a bad community. We’re highly attuned to this at our other resorts, that on peak days, we can’t push more people (onto the mountain).

Our job is to keep turning the dials and see how the season goes, see what we think for next year, but in a way that doesn’t lose our connection to any of these communities. I think that these ski resorts need to be a place where everyone feels comfortable they can be at together, whether it’s the person from New York that isn’t as good a skier, to the person who’s got a brown bag lunch in their knapsack, to the person who’s getting a coupon to ski free from their friend, to the wealthy tech person from Hong Kong. These resorts need to be open and accessible to a broad range of people. There’s no other place in travel where you see this, where people can be on the hill together. That’s what makes the sport special.

The Ski Industry

Pique: We’ve seen a lot of consolidation of resorts in the North American ski industry. Do you see that as the norm moving forward?

RK: We’re not the only ones looking around seeing that this business is going to get a lot tougher with the weather. I think there’s a sense that going it alone might have been OK 10 or 20 years ago. But for the next 20 years, going it alone as a ski resort is a risky proposition. If you get a few bad years in a row, it can have a real negative impact on the community, on the resort, on the ability to provide stable investment, engagement and employment. Honestly, if you look back at the ski industry in the ‘70s when there were a few bad years, ski resorts had to do really Herculean things … to stay afloat. Our company and many others have been able to avoid that, even during tough years. So having that geographic diversity, where if there’s bad weather in one place, you have good weather somewhere else, (is essential).

We collectively have some challenges around the weather and how we’re going to stay sustainable.

I hope our company doesn’t get caught flat-footed, because we have all the warning signs.

Climate Change

Pique: You mention these efforts to reduce your environmental footprint, and Vail Resorts last year made a commitment to that end through the Epic Promise initiative. Do you think the financial contributions that the Vail Resorts Political Action Committee, a fund that you yourself have personally contributed to, has made to the campaigns of noted climate-change deniers in the United States, flies in the face of those efforts?

RK: I don’t think it does. I think that we created, in the States, a Political Action Committee (PAC) to represent our employees. The truth is that we have 33,000 employees and they don’t all have the same views, so I think our political action committee has to take a bipartisan approach, because climate change is one issue that it is true we don’t agree with a lot of people on. But there are other issues, like helping in the U.S. to protect Forest Service funding, which was gyrating all over the place because of fires, where they wouldn’t have enough money to take care of their local environments. Well, we worked on a bipartisan basis to fix that.

In the end, even on climate change, I think we’re going to have to broaden the number of people who are in the tent. We have to show people that (addressing climate change), this issue that has become—especially in the States—so politically toxic, actually is a sound business (strategy). And that’s what we tell our shareholders, and our shareholders have all kinds of views on climate change.

You see a lot of people now in the States trying to move from a political discussion to a business discussion, and I think that’s where the most important progress has been made. So cutting off dialogue because someone is in the wrong political party doesn’t make sense.

If you look at me personally, yes, all of my political giving is only to one side. So on a personal level, I obviously fully agree with (addressing climate change), but I don’t think that’s necessarily the right approach for a broad political action committee for the company. That would pigeonhole us. If we really want to help drive change, we’ve got to have a conversation with a wide array of people. Sure, some of those people I would never vote for, but I try and make that separation.

Pique: How do you make progress on this issue that, as you said, is so polarizing that changing people’s minds can seem like an impossible task?

RK: Our company is committed to reducing our energy use and finding efficiencies. We’re now committed to purchasing green power.

In Whistler, because of some amazing forethought, there’s a lot of green power that is used here. But for a lot of our U.S. resorts, they’re not in those kinds of grids. So now we’re saying we’re going to go out, using our own money, to actually help get green power … off the ground. Other companies are doing the same thing.

Does Rob Katz Ski in Jeans?

Pique: To wrap up, we have a very important question sent to us from the community: Do you indeed ski in jeans?

RK: No, I do not ski in jeans, but I think that was somewhat self-evident.

The best thing about that is I got a text from my son, who is in college. Somebody in his fraternity who was in Whistler took a picture of (the “Rob Katz Skis in Jeans” sticker) and sent it to me. So I have it on my phone, and there’s part of me that wants to run out there and put up my own set of stickers.

Pique: What would your stickers say?

RK: I have shown self-restraint already so I’m not going to (comment). [Laughter] I’m just going to embrace it. And, for the record, because I don’t want there to be any misleading (information) out there, I have skied in jeans, back when I was 10 years old. Hunter Mountain, jeans, gators, that’s exactly where I did my initial skiing. And guess what? Everyone else at Hunter Mountain skied in jeans and New York Jets jerseys. You can’t be snobby. Everyone who learns how to ski comes to this sport in different ways.