2012 has been another exciting year for Analytic Hospitality Executives! I have been energized by the growing interest in analytics across the hospitality industry, in all sectors, and throughout all departments within the organization. In fact, I have met more hospitality people with “analytics” somewhere in their title in the last six months than over my entire career. This is truly an exciting time to be an Analytic Hospitality Executive!
This is not just true in the US, where I make my home, but across the globe as well. I had the privilege of visiting India for the first time this past January, and was intrigued by the challenges the hospitality industry faces there (see my blog post from earlier in the year for more details). The domestic brands are growing quickly, and they are facing challenges with finding and training qualified labor and also with meeting customer expectations while maintaining a profitable cost structure (sound familiar?). In addition to these challenges, expansion by all of the global brands into India is putting pressure on domestic brands to compete for the international traveler as well. This means gaining exposure on the global stage, as well as developing systems and processes (like loyalty programs) that can attract this kind of traveler. (It goes without saying the Indian brands will also need to develop strong analytic capabilities in marketing and revenue management in particular to keep pace with these global players).
I also spend some time in Macau, Hong Kong and Singapore this past spring. The growth of the gaming industry in Macau is just incredible. Smart operators in Macau realize that the “if you build it, they will come” mentality will come to an end someday, so to survive and thrive, they need a competitive edge. They will need to better understand patron behaviors and preferences to attract profitable patrons. Most of the major companies in Macau are quickly building up analytic capabilities to answer these challenges. No different than in other areas of the globe, hospitality companies in Asia are being challenged by mobile and social. As companies develop and execute programs to increase engagement and drive bookings, analytics will become critical. The real-time component introduced by mobile will challenge the velocity at which results must be calculated and delivered. The volume and variety of social data is a tremendous source of information for hospitality organizations, but the right analytics is needed to turn that volume of data into meaningful, actionable information. This is no different than what we are facing here in the US – and further demonstrates that we are living in an interconnected global community, where actions have far reaching ramifications!
More than anything else, 2012 reinforced to me how interconnected all of the functions within the hospitality industry are. At the Analytic Hospitality Executive, we spent a good portion of the year talking about innovations in revenue management and price optimization that will help to overcome some of the market challenges facing the revenue management function. These challenges are driven by the same factors that are impacting other departments (like marketing); price transparency, shrinking booking windows driven in part by mobile bookings, and increased competitive pressures. It is not new news that solutions developed by one department can create problems in other areas, but the pace of today’s business environment means that it is even more critical than ever to ensure that decisions are synchronized across the organization, leveraging all available information. As much as this is a technology challenge, it is an organizational and culture challenge as well, requiring alignment of goals and incentives along with access to the right data and systems.
The American Statistical Association has joined other leading statistical societies to declare 2013 “The International Year of Statistics”, and I think this will hold true for the hospitality industry as well. In fact, I think 2013 will be the year not just of statistics but also of Visual Analytics. They say a picture is worth a thousand words. Well, that’s true in analytics too! Hospitality companies will need to continue to justify the investment in analytics software and the people to support it, reaching higher and broader in the organization to evangelize the value of analytics. At the same time, the pace of business will continue to increase. We will have less time to do more, and those who are able to communicate results effectively will be the ones that continue to succeed and drive companies forward.
Quickly and effectively presenting analytic results, in the forms of charts, graphs or even stories that reinforce a point will be crucial to gaining acceptance. Rows and rows of data, complex charts with equations, p-values and regression outputs are not the language of business. Yes, we’ll still need to ensure that results are based on analytical rigor, and we will need to be prepared to support the conclusions we make. Telling the story in a simple and engaging format that quickly drives home our points will get the attention of busy executives, owners, shareholders and stakeholders. For a number of years now, we’ve looked for “geeks who can speak” in revenue management to tell the revenue story to stakeholders across the enterprise. We’ll need this particular skill across the organization moving forward!
Throughout 2013 we at “The Analytic Hospitality Executive” will be walking our readers through the process of building a strategic analytic culture throughout your organization. It’s time to tie all of those pockets of analytic excellence we’ve built up over the last few years into one high-powered analytic entity, with each group contributing their own expertise to the overall goal of moving the entire organization forward, profitably. We will continue to highlight emerging research from our co-sponsors at the Center for Hospitality Research at Cornell, discuss insight we have gained from conferences and events, and challenge our readers with interpretations of current events. We plan to do all this with an eye to how each piece contributes to a business strategy with analytics at the core.
This entry marks the end of our first year of the “The Analytic Hospitality Executive” blog. I have thoroughly enjoyed my first foray into blogging, and I sincerely appreciate the efforts of my co-author Natalie Osborn in coordinating, driving and co-contributing to the good work we’ve done this year. I have enjoyed interviewing many industry leaders and academicians throughout this year as well. And most importantly, I have appreciated you, the loyal followers of the blog. I have received great feedback from you throughout the year, and have enjoyed provoking conversation and continuing to learn from such a vibrant community. I wish you all a great holiday season and a safe and happy 2013. I look forward to continuing our dialog next year!!