Two incredibly important roles and critical to the success of every hotel, the GM and Revenue Manager.
NB: This is an article from Right Revenue, one of our Expert Partners
So, what kind of conversations should they have? Well, here we list the questions/conversations that we feel should take place. I hope you enjoy the read…
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General Manager… Revenue Manager… often the ying and yang of a hotel.
Broad stroke this may be, but General Managers tend to come up through Operations. Many of the GMs I have had the privilege of working with have been Chefs, Bar Managers, Restaurant Managers, Duty Managers, or Assistant GMs, and then finally the very rightly coveted role of General Manager.
GMs I salute you! You have a gene that screams ‘people person’. You often love to ‘walk the floor’, love being customer facing and have even been known to help out during a busy service… I am a Revenue Manager who has worked in Operations, but even after over 25 years in hospitality, I could not do your job…
Revenue Managers, on the other hand, tend to have that title bestowed upon them after a career in Front Office or Reservations. Few take the route that I did and came from Sales but thankfully we are seeing more and more of that as the Revenue Management role moves into Commercial Management. This wonderful new Revenue Manager can morph from any department – Sales; Marketing, Accounts – to name but a few… As long as this person wears a commercial hat, we (at last), see this role expanding and growing in stature. ‘Here, Here’ I say…
But still, I go back to the ying and the yang… and that is what makes these two roles so different but so vitally important. And to clarify, the words we are looking to use to describe this relationship are: collaborative, respectful, support, guidance, and the ability to have meaningful and often challenging conversations without confrontation
So where does collaboration start? Well, it starts how all great relationships start… with interesting questions…
So Mr. Fabulous GM, what should you be asking your Revenue Manager at your weekly meetings and what conversation should this spark?
Question 1: What is our business on the books for the next 3 months?
This 3 might be 6, 9, or 12 depending on your business, but whatever time frame you choose, you need to do a deep dive and be prepared to evaluate every single day. Make sure that your Revenue Manager has the right figures to discuss and set out which reports you to need moving forward (preferably on screen and not printed – we have a planet to save after all!). Only ask for data that you are prepared to measure and build KPIs around. These KPIs can be unique to you, so it might be occupancy / ADR / RevPar or GoPar – you decide… So let’s start:
Why do you want to know this: You want to know if you are trending ahead, on track, or behind where you should be and then put strategies in place.
The Conversation: Where am I compared to pace? Ie Is my business ahead or behind your own KPI (often Last Year, Same Point in Time), but this may be budget or forecast. Revenue Managers typically hate being held to budget as they often can have zero or close to zero input into the figures presented. Many prefer to work to a forecast as that can often reflect their own or a system’s more realistic calculations as they ebb and flow with changes in market conditions and are not carved once in stone and left as a mythical figure to try and achieve. No matter what you choose to measure, you need a deep dive into the response.
Actions if you are ahead of pace:
· Have your distribution channels been restricted? You don’t want to leak business to expensive OTA’s if you don’t need to (more to follow on that point)
· Have lower rates been closed and your base rate moved?
· Can we add restrictions such as minimum length of stay (a blog for another day but this restriction is being used less and less) but you may want to look at what restrictions you can add if you feel your business can take it.
· Has the forecast been adjusted and how does that align with the budget (again more to follow)
Actions if you are on pace:
· We all love to beat pace, so what actions are being put in place to beat our forecast/budget?
· Can we push our ADR, change rate strategy, or start to restrict (as above)
Actions if you are behind pace:
· Do you need to look at specific need dates and put specific campaigns in place? Will this mean a mailshot? Do you need to have your Digital Agency on stand-by to run targeted campaigns?
· What packages do you have online?
· Are your OTA’s open for sale?
· What has been communicated to Sales and to Marketing? Are they aware of what they might need to do to plug any gaps? What strategies have both departments jointly agreed on to attract new business?
The bottom line here is that you need to be ahead of need dates, so make sure you have the data and let your Revenue Manager get in front of this… You have a highly skilled team member sitting in front of you who may know the numbers, but their role is the strategy. Your Revenue Manager will know (or should know) what works and what doesn’t… You may be behind now for one month which is three months ahead but that is okay… A great Revenue Manager will relish the challenge to build a strategy around filling that gap.