Hotel Profit Discovery

The 5 Steps to Hotel Analytics Enlightenment

To go from data to profit, your hotel company needs to adopt a healthy enthusiasm for the limitless potential of RM analytics with the discipline and awareness that comes from having a mature business acumen. Unfortunately, most hotel companies are focusing their energy and dollars on quickly implementing the next technical  tool in RM, whereas the more purposeful approach is to clearly articulate, formulate, and ONLY THEN implement RM analytics solutions that will truly drive sustained profit. The latter approach is the hardest but it is the only way to guarantee success.  To guide you on this journey, here are the 5 basic milestones that you will need to conquer in order to achieve true RM analytics enlightenment.

1. The 80% Step: Theee End!

All successful RM analytics projects start with a clear articulation of what the new reality will be after implementation. While this approach may be obvious, it is seldom followed. In absence of a robust plan, too many companies default to the “discovery” scheme wherein analysts immediately dive into large databases with little guidance of how to filter the research with real potential from the academic. Always begin with the end in sight and be guided by the principle that the ultimate objective of any business endeavor is to create value from purposeful customer engagement.

2. Rolling Up Your Sleeves:  Data Re-purposing

The majority of business data is collected for the purpose of billing and fulfilling. Accordingly, most databases are programmed to simplify the process of capturing transactions and not for discovering patterns inherent in them. Analytics thinking obligates managers to revalue every data stream in terms of how it contributes in moments of making important decisions. Inevitably, managers realize that their “organic” data is plentiful but often contaminated, incomplete and even irrelevant. Your opening act is to re-task your data from simply “logging” activities to “signaling” significant events. In the process, your data becomes easier to collect, more organized, and more predictive.

Master the Data Science of Hotel Revenue Discovery
“If you only take one RM course, take this one” – Constantino Papadopulos, GM, CHA, CHRM, CRME, SOHO

3. The Smart Hotel: Real-Time Insight Streaming

The latency of hotel data reporting is responsible for the reactive nature of managerial decision making in the hotel business. While it would be illogical to reveal the score of a game only after the final whistle, many hotel companies still wait on month-end financials before proposing future tactics. The objective of good RM reporting is to democratize customized intelligence that combines live transaction statistics, historical performance, managerial targets, and prescriptive advice – all while it is happening or at least shortly thereafter. By broadcasting the vital signs of customer engagement in real time, managers become empowered to exploit the opportunities present in the “now”.

4. Playing in the Major Leagues: Mathematical Models

Every business is involved in a unique set of interactions within a system. Customers, employees, vendors, and technology engaged in a “dance” called the supply chain. Analytics is the process of translating those interactions into advanced mathematical equations that model the real world. By capturing the intricacies in the behavior of each participant in the supply chain, models give you insight into what will happen when you try to modulate their interactions. Your ultimate purpose in this step is to build and maintain prescriptive models that guide decisions that result in uncommon achievements.

5. The Holy Grail: Systems of Models

To achieve Total Profit Optimization, the policies, informal heuristics, and relevant market forces that guide functional decisions must be integrated into a hierarchical set of mathematical functions. This relational framework of financial and probabilistic interdependencies is used to expose the complexities of balancing the often incongruous objectives of sales, marketing, and operations. Systems of Models employ the algorithms of optimization to reveal the networked decision variables that have the greatest impact on your business as a unified whole. This is when breakthrough strategies are birthed and the transformational power of analytics reaches its “actualized” state.


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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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