The Changing Revenue Manager: How Online Competition Is Impacting Personnel Demands

By Christian Koestler President & CEO, Lixto, Inc. | March 11, 2012

As the “Great Recession” in the United States winds down, the hotel industry is making its way back – slowly. According to’s Hotel Industry Pulse (HIP) index – an indicator that tracks monthly business conditions in the industry – future business activity in the U.S. hotel industry has been edging upward month by month.

Five of the HIP’s forward-looking yielded positive contributions, while four indicators of future business activity had negative or zero contributions. The message? As the industry continues to deal with an uncertain global economy, hoteliers will need to hone skills and practice sharp management to remain competitive and grow.

Revenue management is at the core of the picture, with its impact squarely in profit generation. In coming months and years, the hotel industry faces one of its greatest challenges in how best to find, and then use, talent in revenue management to gain competitive advantage and drive value for the business.

Adding to the challenge is the continuing growth of online business in the industry. Online travel agencies, greater use of direct websites by consumers and mobile technologies are changing the mix of skills a revenue manager must maintain. Whereas hotels once could hire, train or even re-classify employees as revenue managers, they must do much more than that going forward.

Lodging executives must find ways to recruit and hire the right people with the right qualifications, and then grow that revenue management talent to generate superior levels of service, performance and results. The challenge to identify the qualifications, and find someone with those – or who can develop them – becomes even harder when the qualifications change as quickly as technology changes. But overcoming this challenge is critical to the success of a lodging business. When revenue managers can align with critical business needs, properties will be in a much better position to create sustainable competitive advantage and long-term value.

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Guest Service: Empowering People

Excellent customer service is vitally important in all businesses but it is especially important for hotels where customer service is the lifeblood of the business. Outstanding customer service is essential in creating new customers, retaining existing customers, and cultivating referrals for future customers. Employees who meet and exceed guest expectations are critical to a hotel's success, and it begins with the hiring process. It is imperative for HR personnel to screen for and hire people who inherently possess customer-friendly traits - empathy, warmth and conscientiousness - which allow them to serve guests naturally and authentically. Trait-based hiring means considering more than just a candidate's technical skills and background; it means looking for and selecting employees who naturally desire to take care of people, who derive satisfaction and pleasure from fulfilling guests' needs, and who don't consider customer service to be a chore. Without the presence of these specific traits and attributes, it is difficult for an employee to provide genuine hospitality. Once that kind of employee has been hired, it is necessary to empower them. Some forward-thinking hotels empower their employees to proactively fix customer problems without having to wait for management approval. This employee empowerment—the permission to be creative, and even having the authority to spend money on a customer's behalf - is a resourceful way to resolve guest problems quickly and efficiently. When management places their faith in an employee's good judgment, it inspires a sense of trust and provides a sense of higher purpose beyond a simple paycheck. The April issue of the Hotel Business Review will document what some leading hotels are doing to cultivate and manage guest satisfaction in their operations.