Like much of our world today, the hospitality industry is constantly changing and evolving beyond what revenue managers and leaders of the past could have imagined. During unprecedented change, automation and new technology have become essential to successfully navigating the post-COVID hospitality landscape.
Revenue Managers Becoming Strategists
But with any change, comes reservation and distrust. As the industry continues to automate, some hoteliers worry that automated systems may not be able to respond to change and make decisions as well as human staff. But those who have invested are discovering that automated systems can respond quickly to change; they are better equipped to pick up signals of unexpected changes to the industry before they occur.
The role of a revenue manager is shifting. No longer are they the keepers of manual, rules-based systems and the numbers they produce. Instead, they have become strategists. Revenue management has never been about system upkeep and function but rather the beginning steps of a strategic plan for success. Automated systems allow revenue managers to focus on strategy rather than the thousands of pricing decisions made daily by revenue optimization technology.
Klaus Kohlmayr, Chief Evangelist and Development Officer at IDeaS, discussed the multitude of decisions made by revenue management systems and why they are essential tools for revenue managers in Hotel Tech Report, “Given that a typical hotel will make roughly five million pricing decisions every year, it is not humanly possible for any revenue manager to get every decision right daily without the support of an automated system. Especially considering the sheer volume of data to be gathered and analyzed.
A robust RMS generates prices that adapt to market changes and anticipates these variations in advance. In a changing hotel market, slight pricing changes can significantly impact demand. Therefore, any hotelier operating without systems that can analytically decipher the impacts of a specific price change on occupancy and the resulting revenue benefit (or lack thereof) for their property is operating at a disadvantage.”
Automated Systems Give Revenue Managers Freedom & Flexibility
Revenue automation is one of the tools revenue managers must leverage to build confidence in strong, clean data and have the time to focus on revenue strategy, and elevate themselves by being seen by operations, marketing, and distribution as guardians of data at the hotel. Automated systems give revenue managers freedom and flexibility without worrying about daily optimization. This has allowed the revenue management field to broaden beyond data.
As the hospitality industry continues to recover from the global pandemic, the combination of staffing challenges and the rise in demand will require hotels to run as efficiently as possible. The time saved by revenue management systems allows revenue managers to manage multiple properties and participate alongside other strategists to help develop and implement commercial strategies driven by accurate and abundant data.
This data has the power to impact every aspect of a hotel, ultimately improving the guest experience and increasing profitability. Time is money, and automation opens the door to a goldmine.
Man vs. Machine
Many hoteliers believe that introducing automated technology creates a “Man vs. Machine” situation between revenue managers and their systems. Instead, these two parties complement each other. Think of them as a team.
“A revenue manager and a revenue management system should make each other stronger, so each can focus on what they do best,” said Richard Lont, revenue manager of Olympic Hotel.
While revenue management technology can make many decisions automatically, a revenue manager guides the results of those decisions with strategy. They possess the ability to see the real-life scenarios a system may not know how to react to. Revenue managers also have insight into the guest experience. While an optimized room price can attract a guest to book a room, the experience they have during their stay makes them return.
Automation does not replace the role of a revenue manager but instead elevates their work and provides managers with new opportunities to lead using data. The revenue manager and the system they use are well-oiled machines. One without the other is inefficient and lacks strategy.
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Automation is the present and the future. Embracing automation is the only way revenue managers can reach the full potential of their role. They are not servants to the machine but the person behind the curtain.