Hotel Profit Discovery

Results of Science of Revenue Management Open Quiz

We finally compiled the results of our first open RM Analytics Quiz.  The objective of the quiz was to find out how much our readers knew about the basic concepts of the Science of RM.  While we will never know the job title of the participants of this quiz, it is safe to assume that most are RMs given the reader profile of this blog. We asked 12 beginner level, multiple choice questions about data, algorithms, databases, and Excel.  We recorded 362 responses which were all completed anonymously.  Below are the results with question-by-question statistics..

The average number of correct answers was 4 with no participant getting more than 10 correct answers.

Freq_Correct

Only 16% answered at least half of the questions correctly.

CFreq_Correct

The certification that is changing Revenue Management.
“Thank you for coming up with this powerful RM course. Though I have finished the Cornell Advanced RM certification I felt your course is something I should have learned earlier.” – Abhijeet P.k Reservations Manager at Flora Group Hotels Dubai
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Question-by-Question

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Question 1. The beginning statement for a SQL query is…

Answer Choices:

a) WHERE

b) SELECT

c) JOIN

d) FROM

Correct answer is b) SELECT.

Percent of participants answering correctly: 41%

Question 2. The number of times an event occurs is…

Answer Choices:

a) FREQUENCY

b) COUNT

c) PROBABILITY

d) CHANCE

Correct answer is a) FREQUENCY.

Percent of participants answering correctly: 72%

Question 3. Optimization is mainly based on the mathematics of…

Answer Choices:

a) Trigonometry

b) Game Theory

c) Operations Research

d) Topology

Correct answer is c) Operations Research.

Percent of participants answering correctly: 40%

Question 4. The Micros Opera database is built on…

Answer Choices:

a) ORACLE

b) SYBASE

c) Microsoft SQL

d) Microsoft Access

Correct answer is a) ORACLE.

Percent of participants answering correctly: 54%

Question 5. Which one of these is not needed to calculate Expected Value?

Answer Choices:

a) Probability

b) Reward

c) Variation

d) Loss

Correct answer is c) Variation.

Percent of participants answering correctly: 20%

Question 6. The data layout of a database is called the…

Answer Choices:

a) Table Tree

b) Schema

c) Data Directory

d) Hierarchy

Correct answer is b) Schema.

Percent of participants answering correctly: 32%

Question 7. The Capacity Control optimization algorithm requires that you first build…

Answer Choices:

a) Pickup Forecast

b) Market Mix Table

c) Seasonality Grid

d) Frequency Tables

Correct answer is d) Frequency Tables.

Percent of participants answering correctly: 17%

Question 8. The optimization algorithm that requires the RM to have perfect market rates information is…

Answer Choices:

a) Regression

b) Dynamic Pricing

c) Capacity Control

d) Clustering

Correct answer is c) Capacity Control.

Percent of participants answering correctly: 14%

Question 9. Excel functions that allow you to filter data before calculating are.

Answer Choices:

a) Threading Functions

b) Criteria Functions

c) Logic functions

d) Screening Functions

Correct answer is b) Criteria Functions.

Percent of participants answering correctly: 42%

Question 10. The core heuristic behind Capacity Control is…

Answer Choices:

a) Fundamental Model

b) Littlewood’s rule

c) Belobaba’s expansion

d) The Dantzig algorithm

Correct answer is b) Littlewood’s rule

Percent of participants answering correctly: 22%

Question 11. Converting a Demand Function to a Price Function requires…

Answer Choices:

a) Basic Algebra

b) Extrapolation

c) Linear Algebra

d) Combinatorics

Correct answer is a) Basic Algebra.

Percent of participants answering correctly: 27%

Question 12. The level at which you analyze data is…

Answer Choices:

a) Dimensionality

b) Detail

c) Rollup

d) Granularity

Correct answer is d) Granularity.

Percent of participants answering correctly: 29%

Many of you may ask why you need to know any of this “stuff” if you have an RMS or a corporate group that figures out all your data and optimization needs.  I’ve been asked this question too many times and I always give the same answer.

Would you be concerned if the hotel’s accountants did not know how to create a trial balance just because they are using a General Ledger software?  Would you care that they did not know the implications of new tax rules just because they use external auditors?  Yet, Revenue Managers have as much fiduciary responsibility for financial results as their counterparts in accounting, so why not give RMs the respect they deserve. However, with that respect comes great responsibility to understand your craft inside and out.

I am hopeful that we will be able to publish this quiz again in a few years and get better results.  Many RMs are hungry for a more sophisticated approach to their job. We already have hundreds of RMs taking our  SOHO course and learning the answers to all of these questions and much, much more.  I am confident that the profession is slowly maturing and many RMs will someday begin calling themselves Hotel Data Scientists.

Take your Revenue Management skills to the next level.
“Having been through a number of RM courses, including one from Cornell, yours really explains and shows the calculations behind the RM system being used.  Your concept of looking at the individual transactions opened a whole new world for me, especially how this relates to pricing.” – Ronald Hopman, Director of Revenue Management, Aruba Resort, Spa & Casino

 


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Robert Hernandez, Statistical Analysis and Data Mining for Revenue Growth Robert is an expert in the field of mathematical Hotel Optimization and Analytics. He has spent the last 17 years building data-driven forecasting and optimization models for companies in over 20 different industries, from tech to tourism. Robert possesses a very unique skill set including cross-disciplinary experience, advanced mathematical and analytics skills, data transformation, industry-specific knowledge and business-process improvement expertise. Robert began his career at the Walt Disney Company in Revenue Planning. Read More+


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