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The Indian/AAHOA phenomenon


There's more to being a high achiever than hard work and drive. Sometimes a different muse is at work, as in the case of the Asian Americans who have come to dominate the budget hotel industry in the U.S.

In Malcolm Gladwell's profound and best-selling book, the "Outliers," he analyzes high achievers who are the result of influences that are separate and apart from ability and hard work. In the initial chapter he describes the town of Bedford, Pennsylvania, (population 2,000) where residents are comprised of Italian immigrants from the town of Roseto, Italy.

In the late 1950s medical studies were performed on the Roseto/Bedford residents to determine why their rate of heart attacks were substantially below the national average. Surprisingly the results of the studies indicated that the health of the residents was not due to diet, exercise, genes or location, but their culture. The Rosetans transplanted their Italian culture to Bedford, comprised of strong family ties and community support. The Rosetans developed a strong protective social milieu insulating their community from the stresses of the modern world. The Rosetans were healthy because of the lifestyle they had created.

Fast forward to the Indian community and the Asian-American Hotel Owners Association (AAHOA), the vast majority (about 98 percent) originally came from the region of Gujarat, India. They came to the U.S. to find a better life. The early Indian immigrants in the 1960s found in the hotel business (initially budget hotels) opportunities for success as small-business owners, as well as facilitating their entry into U.S. citizenship through the ownership of real estate and businesses.

As the early Indian hotel franchisees succeeded, they served as catalyst for more of their Gujarat countrymen to immigrate to the United States and enter into the hotel business. They were supportive of each other culturally, socially and financially. The early hoteliers served as a resource to their new brethren with their hotel knowledge as well as financial support. Today Indian hoteliers own franchises in not only budget hotels, but also mid-scale and upscale hotels.

It was not uncommon for a successful Indian hotelier to make a loan to one of his colleagues as a new entry into the hotel industry. I remember having dinner with a prominent Indian hotelier at his home a number of years ago. There were more than 20 family members at the dinner table. I asked my friend if he had ever lost any money on a loan he had made to one of his Indian colleagues. He indicated only once in the numerous times he extended loans had he encountered any difficulties. His borrower in that situation had the ability to repay the loan, but did not. He said that the loan was repaid several months later without litigation. The borrower had been "shunned," i.e. socially ostracized by the Indian community in his area when the word had gotten out that the loan had not been repaid. I responded that this was a much more effective technique than litigation. Today the Indian community continues to help each other with funding in the hotel industry.


Mort Aronson

Mort Aronson, professor, Emory Law School.

Interestingly enough, the concept for AAHOA originated in the late 1980s by then-president of Days Inn, Mike Leven, with the assistance of his consultant Lee Dushoff, and the financial support of Henry Silverman, then part-owner of Days Inn. According to Leven, the Indian community was being subjected to discrimination when they attempted to obtain franchises, loans for franchises, adequate insurance, adequate supplier support, and other related areas. He worked with H. P. Rama, Ravi Patel, and others to form AAHOA in 1989 as an organization to protect Indian rights and help foster the Indian economic opportunities in the Hotel Industry.

The first AAHOA Annual Meeting was comprised of 150 attendees. Today, according to AAHOA's president, Fred Schwartz, the organization has more than 9,200 members who own more than 40 percent of the hotel rooms in the United States. To truly understand this incredible success, we need to appreciate not only the talent and hard work that the Indian community has demonstrated individually, but their strong social, cultural and financial support of one another, not dissimilar to the Rosetans. In particular, with AAHOA as a facilitator of Indian unity and support, the Indian hoteliers have had phenomenal success.

AAHOA and the Indian community stand out as a shining example that the United States is a country that encourages diversity along with cultural continuity. They show that success can be enhanced as part of the American dream by assimilating into mainstream America while maintaining your cultural heritage and support of your cultural group.

Mort Aronson is an Atlanta attorney and an adjunct professor at Emory Law School. He can be reached at mortonaronson@yahoo.com.

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