Hoteliers know the demand for well-trained revenue managers (RMs) has exploded in recent years. All hotels need a qualified individual whose responsibilities include addressing the property’s unique approach to optimizing profitability by recognizing, forecasting, and shaping their customers’ buying patterns.
The best training programs for RMs address key content in the areas of customer psychology, accounting, sales, marketing, and rooms management, among others. And yet, every hotel GM could likely relate to the following “it really happened” case study; widely used today in the training of RMs:
You’ve got to be kidding me!” said Basil, the owner of the 180-room Holiday Suites hotel.
“No, I’m not kidding. He sold them all,” replied Sandy, the hotel’s DOSM.
Together, Basil and Sandy, who had completed her franchisor’s required revenue management training program, served as the hotel’s revenue management team.
It was February 6. Sandy had just informed Basil that Mike, the hotels’ new night auditor, had, late last night, taken 17 separate reservations. Each reserving guest had purchased nine rooms. Each reservation was for one night, and all were scheduled to arrive November 22.
Because the buyers had purchased in quantity, Mike had given each a 10% room rate discount; the normal amount permitted when a reservation agent was quoting rates for a multi-room sale. Mike had sold every remaining available room for that date, nearly nine months away.
“But that’s the weekend of the Annual Sailboat Show. The city will be packed! We always sell out that weekend. We never sell at discount, and we always require a three-night minimum stay on each room.”
“I know,” replied Sandy. “But Mike’s new. He said he didn’t know. No one told him. And I forgot to flag those dates in the PMS”
What happened? Mike made a costly error, but it was a reasonable error for someone new. More importantly, for the hotel, this is actually a story about Sandy forgetting a key part of her training. Sandy could have prevented the error by following PMS maintenance protocol. But she forgot the importance of blocking dates in the PMS far in advance. Sandy’s revenue management training was probably good, but it was clearly not re-memorable. Re-memorable training prevents errors due to memory loss over time; and we know errors of this type are commonplace.
For a long time, neuroscientists have studied human forgetfulness. In fact, in the late 1800s memory researcher Hermann Ebbinghaus first quantified the effects of time on memory and in doing so identified the “Forgetting Curve.” Figure 1 shows a typical forgetting curve.
