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Don't underestimate the power of processes for capturing revenue

03 June 2021
Commercial processes are more crucial when time is a scarce resource. Hotels cannot afford to waste any time during the recovery due to a lack of planning, processes, and procedures. Revisit the most critical processes and make sure they are ready to handle the returning demand.

Become best in class

The word process sounds mechanical and stereotyped to people in hospitality that only think about personalization and experiences. Do not underestimate the advantages of a solid process. Hotels can design each process to deliver a specific outcome, such as the perfect guest experience. The team can continuously adjust and refine the process based on learnings until it is working perfectly. Solid processes require less time for new employees to deliver quality work. What would quick-service restaurants or hotel housekeeping departments be without years of refining their processes?

There are many vital processes to help make the commercial work more productive. Let's take a closer look at three of them.

Budget process

The budget process represents planning and an opportunity to look into the future. The primary purpose is to create an annual financial plan to take you closer to the long-term vision. In many hotel companies, the budgeting process is tedious with endless revisions until top management and owners are happy. Often a few months into the year, things changed, so the budget is suddenly obsolete. With a productive budgeting process, it would be quicker and easier in the first place and easy to adjust and update. The value added by traditional budgeting diminishes when the pace of change increases. A more brilliant way of working is to put effort into forecasting that gives all stakeholders an up-to-date view of the business.

Forecasting process

The forecasting process is more critical to keeping an up-to-date day-by-day forecast for every primary revenue source. Part of the process is tracking pick-up daily and changing the outlook, campaigns, and pricing. A well-thought-out forecasting process triggers actions while the budgeting process traditionally is more static and sits there being obsolete somewhere in the background. Having a 12-month rolling forecast in place will automatically trigger actions when demand changes. The forecast is also the basis for labor scheduling and purchasing and, therefore, one of the most critical processes for profitability. Without a solid forecasting process, the top management does not grasp the future and cannot take action before it is too late.

Marketing campaign process

Hotels with a process for creating, launching, and tracking campaigns will eventually become best in class in capturing demand with appealing campaigns and packages. These hotels will attract the guest and sell more products and services to every guest - a double win in generating revenue. A systematic approach to marketing campaigns will lead to new knowledge when team members carefully evaluate campaign results. A 360-degrees evaluation of each campaign would, over time, bring in more revenue to a significantly lower cost.

These three examples show the added value of processes. A solid budgeting process will save a lot of time and effort, forecasting will trigger actions to improve profits, and campaigns will capture more revenue.

For more ideas, download the white paper "Create a High-Performance Commercial Team."

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