Terms like “Data Analytics”, “Business Intelligence (BI)” and even “Artificial Intelligence (AI)” are fodder for hospitality industry events and conferences these days. Data has been called “The New Oil” and Data Analytics is the new standard for strategy and decision support. This is particularly true for the travel and tourism industry where hotels, airlines, and car rental companies rely on competitive pricing and complex distribution strategies (based on the latest booking trends) to optimize their revenues.
Todays hoteliers recognize that BI is a necessity to stay competitive in the information age. However, they are not always sure how to pick the right tool (for them) from the plethora of analytics tools in the market. Here are a few tips to help you get started:
Data Management Before Data Analytics
Data is the fuel that powers all analytics. Therefore, it is important to ensure that you maintain good data quality in your source systems. Appointing Data Stewarts at the Front Desk or Reservations Office is a good place to start. However, no matter how good your operational processes are, things are bound to slip through the cracks. So, when looking at a BI platform ensure that it has data management capabilities to match your needs.
Depth of Information Over Breadth
While there is some convenience in having all your information in one place, it alone cannot justify a BI initiative. A business analyst can easily gather high level metrics from various sources and email them to decision makers in a matter of minutes. True BI enables you to deep dive into the underlying data that is impacting those KPIs. For example, if you notice that you are starting to lag in booking pace, your BI tool should easily enable you to determine which market segment (down to rate code), booking channel, source market, room type, or any combination of these elements is responsible for the lag.
Business Planning and Performance Management
These days hotel managers are running in and out of meetings as they are planning and budgeting for next year. Some are using BI tools at their disposal to have deep meaningful conversations regarding business trends and how to influence them, others are simply trying to guesstimate figures that will satisfy the owner’s rep.
A BI tool that does not actively facilitate the budgeting and forecasting process, is either being underutilized or is not the right fit for hospitality operations. With the analytical capabilities of modern BI, you should be forecasting at the most granular levels and should be measuring your performance against it on an ongoing basis to ensure you achieve your goals.
Hotel Analytics as a Service
Cloud computing has revolutionized the way we utilize and consume technology. You no longer need to pay an exorbitant amount and go through a massive implementation process to empower your hotel(s) with BI. Subscription-based BI solutions are available in the market and there are many that cater to the specific needs of the hospitality industry. Therefore, within a matter of weeks you can have powerful and interactive BI at your finger tips and be checking your pace, pick-up, and other complex analysis on the go. As hoteliers, your job is to manage your hotels. Don’t let anyone talk you into taking on the added responsibility of managing a BI infrastructure on-site.
Parting Words: Don’t Confuse the Knife for the Chef
We hope you find the above tips helpful. They are intended to help you pick out the right BI tool for your hotel business. However, we strongly believe that BI is NOT something you can pick off the shelf – it is an organizational capability. The tool can only present the information but it is up to the end users to ask the next question, slice and dice the data with the tool, identify opportunities and threats, and make fact-based business decisions in a timely manner. In other words, the BI tool is the knife but you are the Chef.