{468x60.media}
Ms. Noone

Revenue Management

Bridging the Revenue Management Talent Gap

By Breffni Noone, Associate Professor, School of Hospitality, The Pennsylvania State University

Company Growth Requires a Strong Focus on Revenue Management

Revenue growth is a fundamental driver of long-term hotel performance. A focus on revenue places the revenue management function, as the natural owner of top line revenues, squarely at the forefront of driving a hotel company's success. Just as the scope of the revenue management function has evolved from a stand-alone function charged with managing rooms revenue to an organization-wide initiative concerned with maximizing the profitability of all hotel revenue streams, the requirements of a revenue leader have changed. It is no longer sufficient to possess the stereotypical number-crunching skills needed for revenue management. Revenue managers also need to have the people skills and leadership experience required to engage and influence the management team, such that actionable, forward-looking revenue strategies can be effectively implemented.

The increasingly demanding role of the revenue manager has signaled a growing need for a talent pool to support the revenue management function, leading to the fundamental question: where, beyond existing initiatives, do opportunities lie to develop the talent pipeline? The HSMAI Revenue Management Advisory Board for the Americas asked themselves that very question.

A New Initiative to Address the Revenue Management Talent Gap

The mission of the HSMAI Revenue Management Advisory Board is to advance the Revenue Management discipline and, over the years, it has done so in a number of ways, from the Certified Revenue Management Executive certification program, to the annual HSMAI Revenue Optimization Conference, which provides the revenue management community the opportunity to network and exchange best practices.

In the Fall of 2016, the Advisory Board added a new initiative to its roster of activities, formally launching a Faculty Outreach program, geared towards engaging with revenue management faculty at hotel schools to promote the revenue management field and develop resources to support revenue management education. In doing so, the objective is to help to bridge the revenue management talent gap.

As a first step towards engaging, and working, with the academic community, the Advisory Board hosted a Think Tank at the 2017 Revenue Optimization Conference in Toronto. Industry representatives from the Advisory Board met with faculty from five leading hotel schools - Cornell University, New York University, Pennsylvania State University, University of Houston, and University of Las Vegas - to gain insight into how revenue management is perceived among hotel school students and brainstorm actionable strategies to promote the revenue management discipline.

Students' Perceptions of Revenue Management

The starting point in developing a talent pipeline is to develop an understanding of those individuals who are most likely to fill the pipeline: hotel school students. Feedback from faculty at the Think Tank revealed four key things that students are not clear on:

  1. What career progression looks like: Students know that they can "go into" revenue management but do not have a clear idea of the potential career path in revenue management.

  2. What revenue management professional do on the job: Closely related to career progression, students are not clear on what a job in revenue management actually comprises. They understand the fundamental elements of revenue management but do not have a full appreciation of the specific roles and responsibilities of revenue management professionals at different points along the revenue management career path.

  3. What opportunities exist while at school: Students are often unaware, or realize too late, that they can pursue an internship or externship in revenue management while at school. Two factors contribute to this. First, hotel companies tend to promote, and recruit most strongly for, operations positions rather than functions like revenue management during campus visits. Second, revenue management courses are frequently positioned on hotel schools' curriculums such that students don't take them until their third or fourth year in the program. Therefore, until the point at which they are taking these courses, students don't know to look for, or ask recruiters for, revenue management internship or externship opportunities.

    The importance of exposing students to revenue management through internships and externships cannot be underestimated. In my experience, without some exposure to revenue management in the field prior to graduation, students are less likely to "risk" going into revenue management when they graduate. Equally, without some field experience before graduation, a company may be less inclined to hire a graduate to work in revenue management.

  4. How to "sell" their skill set to potential employers: Students often struggle with determining how to communicate their revenue management training to potential employers. Compared to other disciplines like human resource management, accounting, and finance, revenue management is a relative newcomer to the hospitality school curriculum and consequently, the revenue management course content and rigor can vary significantly across hotel schools. In the absence of a standard revenue management certification that can provide a benchmark of a student's knowledge and skill set, students are challenged in terms of communicating the depth and breadth of their revenue management training.

Perhaps the most startling among these student insights is that there appears to be a distinct lack of awareness among the next generation of hoteliers of the career opportunities that exist in revenue management. This sends a clear signal to industry and academia that we need to do a much better job of selling revenue management as a viable and sustainable career path. While the HSMAI Revenue Management Advisory Board is focused on developing broad stroke strategies to promote the revenue management profession across U.S. hotel schools, and provide revenue management educators a toolkit of resources to leverage in the classroom, what can you do at a company level to engage students and grow your own pipeline?

Small Steps, Big Impact

Here are four activities for you to consider:

  1. Get started with some good PR: Reach out to one, or several, hotel schools. Speak with deans or program directors about the opportunities that exist for students in the revenue management field. Set up a visit to an introductory course (e.g., Introduction to the Hospitality Industry or a similar type of course) where you can engage with students early in their programs of study. Promote the revenue management function within your property or group of properties. Give the students an overview of "a day in the life" of a revenue manager and expose them to what they can expect if they pursue a career in revenue management. Also, connect with revenue management faculty. Visit the revenue management classroom and share your expertise. Don't have time to visit a classroom in person, or the university is too far away? No problem, just join by videoconference. Also, if you have campus recruiters, ensure that they highlight the revenue management function during information sessions. Even if a revenue management position is not available during a given recruiting season, it will build awareness among students of the potential to pursue a revenue management career.

  2. Offer internship opportunities: A great way to discover great talent is to offer revenue management internships but these are not always easy to design. A comment I often get from revenue managers is: "I want to offer internships but I don't know what to have the students do". Unlike operations where management has a good idea of the capabilities of potential interns, it is difficult to design a meaningful revenue management internship program as the true skill set of potential recruits is often unknown. So, ask faculty to collaborate with you on internship design to ensure that you fully leverage students' skill sets. Also, as part of the design process get to know the skill set of your potential recruits by asking revenue management faculty to share their course syllabi and show you examples of the types of projects that students work on in their classes. This will provide you a great frame of reference as you design your internship program.

  3. Collaborate on projects: Project collaboration can be used along with an internship program, or instead of an internship program if resources to support the development of an internship program are limited. Give students access to some data, and allow them to use that data to develop revenue management strategies for you. Have the students present their work to you. This will provide you the opportunity to interact with the students and probe their research findings so that you can maximize the value from their work. The process will also reveal the students who have the greatest potential for revenue management - they can be targeted during recruitment. And, you engage students and give them a flavor of life in the revenue management profession.

  4. Provide mentorship: Everybody, no matter the stage in their career, can benefit greatly from having a mentor, and providing mentorship to students can go a long way towards fostering interest in the revenue management profession. Work with faculty to identify students who would benefit from mentorship by a revenue management professional within your company. Pilot the program with just one student-professional paring. Figure out frequency of meetings, medium, and so on, before expanding the program. Bear in mind that a well-structured mentoring program will enable you to identify talent in a no-risk environment, and provide you the opportunity to cultivate and shape a potential future revenue management employee. After a mentee graduates, you have someone who is ready to hit the ground running - that individual, if well mentored, will understand your organizational culture, the requirements of the position, and your expectations of them.

Bottom line: If revenue management talent development is a strategic goal for your organization, these four activities provide a good starting point. Whether you try all four or start with just one, every small step you take will bring you one step closer to developing your talent pipeline.

Breffni M. Noone is an Associate Professor at the Pennsylvania State University School of Hospitality Management. She teaches courses in revenue management and service operations management. Before joining the Pennsylvania State University, she was a visiting professor in the School of Hotel Administration at Cornell University, and was on faculty at the Dublin Institute of Technology, Ireland. Dr. Noone earned her doctorate from Cornell University. She also holds an M.B.S. from Dublin City University, Ireland and a B.Sc. (Mgmt.) from Dublin University, Trinity College, Ireland. Dr. Noone has been honored with many teaching, research, and advising excellence awards. Ms. Noone can be contacted at 814-865-7128 or bmn2@psu.edu Please visit http://www.psu.edu for more information. Extended Bio...

HotelExecutive.com retains the copyright to the articles published in the Hotel Business Review. Articles cannot be republished without prior written consent by HotelExecutive.com.

Receive our daily newsletter with the latest breaking news and hotel management best practices.
Hotel Business Review on Facebook
RESOURCE CENTER - SEARCH ARCHIVES
General Search:

NOVEMBER: Architecture & Design: Authentic, Interactive and Immersive

Eric Rahe

The advent of social media brought with it an important shift in the hospitality industry. Any guestís experience might be amplified to thousands of potential customers, and you want to be sure that your hotel stands out for the right reasons. Furthermore, technology has increased competition. According to Euromonitor International, the travel industry will have the highest online payment percentage of any industry by 2020, often occurring through third-party sites that display your competitors alongside you. As a result, many hoteliers are looking to stand out by engaging customers and the experience has become more interactive than ever. READ MORE

Pat Miller

Even the most luxurious hotel has a finite budget when it comes to the design or re-design of hotel spaces. The best designers prioritize expenses that have the biggest impact on guest perceptions, while minimizing or eliminating those that donít. This story will focus on three blockbuster areas Ė the entry experience, the guest room, and the public spaces. This article will focus on these three key areas and shed light on how the decision making process and design choices made with care and attention can create memorable, luxe experiences without breaking the bank. READ MORE

Patrick Burke

For over 35 years, American architect Patrick Burke, AIA has led Michael Graves Architecture & Design to create unique hospitality experiences for hotel operators and travelers around the globe, in Asia, Europe, the U.S. and the Middle East. As the hospitality industry has shifted from making travelers feel at home while away to providing more dynamic experiences, boutique hotels have evolved to create hyper local, immersive environments. Having witnessed and contributed to the movement, Burke discusses the value of authentic character that draws on physical and social context to create experiences that cannot be had anywhere else in the world. READ MORE

Alan Roberts

More than ever before, guests want and expect the design of a hotel to accurately reflect its location, regardless of whether they visit a property in an urban center, a historic neighborhood or a resort destination. They also seek this sense of place without wanting to sacrifice the level and consistency of service theyíve come to expect from a beloved hotel brand. A unique guest experience is now something expected not just desirable from any hotel wishing to compete in the world today. A hotelís distinctive design and execution goes a long way to attracting todays discerning customer. READ MORE

Coming Up In The December Online Hotel Business Review




{300x250.media}
Feature Focus
Hotel Law: Issues & Events
There is not a single area of a hotelís operation that isnít touched by some aspect of the law. Hotels and management companies employ an army of lawyers to advise and, if necessary, litigate issues which arise in the course of conducting their business. These lawyers typically specialize in specific areas of the law Ė real estate, construction, development, leasing, liability, franchising, food & beverage, human resources, environmental, insurance, taxes and more. In addition, issues and events can occur within the industry that have a major impact on the whole, and can spur further legal activity. One event which is certain to cause repercussions is Marriott Internationalís acquisition of Starwood Hotels and Resorts Worldwide. This newly combined company is now the largest hotel company in the world, encompassing 30 hotel brands, 5,500 hotels under management, and 1.1 million hotel rooms worldwide. In the hospitality industry, scale is particularly important Ė the most profitable companies are those with the most rooms in the most locations. As a result, this mega- transaction is likely to provoke an increase in Mergers & Acquisitions industry-wide. Many experts believe other larger hotel companies will now join forces with smaller operators to avoid being outpaced in the market. Companies that had not previously considered consolidation are now more likely to do so. Another legal issue facing the industry is the regulation of alternative lodging companies such as Airbnb and other firms that offer private, short-term rentals. Cities like San Francisco, Los Angeles and Santa Monica are at the forefront of efforts to legalize and control short-term rentals. However, those cities are finding itís much easier to adopt regulations on short-term rentals than it is to actually enforce them. The December issue of Hotel Business Review will examine these and other critical issues pertaining to hotel law and how some companies are adapting to them.