Center of the storm.(From the Center)(managing financial crises)

The current economic turbulence is front and center in almost everyone's mind. We often hear: "the worst crisis since the Depression." The challenges to American business, including the hospitality industry, and the suffering of individuals who have watched jobs and financial resources evaporate is difficult to comprehend and is terrifying to so many of us. As we try to navigate through these difficult times it is instructive to look at the past. Besides solace, we may find ideas in how our industry suffered through and survived evil economic periods several times in the past fifty years.

It was in the context of just such a time that the first issue of this journal appeared. The recession of 1958 was, at the time, the referred to as the worst financial crisis since the Depression. Some considered the recession of 1953 as being self-inflicted due to poor U.S. monetary policy. In 1958, however, the recession spread outside the U.S. One source reports that auto sales fell 31 percent in 1958 over the prior year. To make matters worse, inflation kicked in at rates not seen since the post-war escalation of the late 1940s.

With this as a backdrop, the School of Hotel Administration planned a new type of publication, one dedicated to sharing the results of university research with the hospitality industry. With a grant from the Statler Foundation, the Cornell Hotel and Restaurant Administration Quarterly was launched in May 1960. By this time, the world economy, and the hotel industry was about to embark on one of its most creative periods. Coupled with the construction of the remarkable interstate highway system begun by President Eisenhower, the industry expanded using the new-style hotel concepts begun in the 1950s (notably, Holiday Inn and Ramada), as well as through restaurant franchising (used so effectively by McDonald's and Burger King).

In the intervening fifty years, the hospitality industry has seen boom and bust, but the push for innovation and improvement has never waned. In its five decades of publication, the Quarterly has participated in that push for innovation, all the while itself growing and evolving with the industry. In keeping with the industry's evolution, this journal was recently given its current name, Cornell Hospitality Quarterly. Although the journal always included management-oriented topics, the early issues also included a strong hands-on content (e.g., how to improve recipes, how to pave your parking lot, how to select carpet). Over time, however, the management focus grew, as it did in the industry as a whole.

One management development that the Quarterly has followed over the years is the rise of the management contract as a structure for hotel development. Devised in the 1950s by Hilton International as a means of separating ownership from management (thereby allowing faster system growth), the management contract has grown in importance. We are republishing one of the series of management contract articles in this issue as a prelude to our fiftieth anniversary issue, which will appear in February 2010. This article relied on the research conducted by Professor James Eyster, who has written most of this long series. It provides an example of the best of Quarterly articles, since it relies on careful research, but focuses on the implications for industry. In future issues we will republish other classics from the last 25 years. These articles will remind of us the good and not so good times, allow us to see how far we have come, and, hopefully, help us as look to a brighter future.

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