Revenue Management in the Age of Anxiety

Every moment of every day we grapple with choices in these turbulent times. How to make rational decisions when inundated with alarming news, often sensationalised and exaggerated to attract eye balls and as click bait. How to make better use of our time and resources to keep the household running, loved ones protected and earnings stable when faced with some of the most challenging events that are not just turmoil in a far away region that we can switch our attention away from with the click of our TV remote. No matter what our ideology or belief, there is clear evidence of our impact on the environment and that the bush fires along with viral contagion are not some manifestations of our preferred mythical entity having a dummy spit at a short lived and argumentative species inhabiting a fragile little planet a meteor strike away from extinction. We can bring rationality in our decision making and verify our feelings with an evidence based approach and focusing on what we can change. The only time I want to think about "gut feel" is when faced with a gastric episode and what could be at the root cause.

Memento Mori! we can leave life today and it is in our power to choose how our response to all that we can or cannot control. It is not morbidity to appreciate life by recognising the fragility and impermanence of our existence. Every choice made in the "now" can be free from the bias of past experiences and unshackled from crippling self-doubt. How can we not do what's right when there's little time left to us?

The devastating bush fires down under and now the scourge of an untamed virus is like a tsunami of trouble that one can't help worrying deeply about. While communities now strive to survive and re-build and as now nations confront a bug that doesn't care for boundaries, there is concerted global effort to overcome the crises. Anxiety and fear can be debilitating. Our lives are not clearly demarcated between business or personal; what we experience in our daily lives and the feelings that bubble up from our reactions to those events, in or out of our work space, has a ripple effect on our loved ones, teams, customers and reputation. I believe we will come out of this crises, changed but better prepared, as we have done in the past. Consumers will be even more conscious of sustainability and the responsible behaviours of leaders across the spectrum when making buying decisions. A change of mindset now requires not just PR spin to re-position a brand to appear more socially responsible but rather a genuine commitment to keeping this world inhabitable for future generations and to nurture a more caring, kinder & inclusive work place. It's more than just doing away with the little plastic bathroom amenities and moving to refillable containers or "punishing" some Corporate big cheese with a multi-million dollar golden hand shake without changing the culture of the organisations from the top down. What is the quality of work life of our employees and their perception of corporate behaviour? It is not just a millennial or some generational alphabet classification thing anymore. An ageing work force also craves the same as the youngest entrant in the service business; no one wants to suffer & everyone wants to be feel wanted & loved. An intern will no longer tolerate poor working conditions and corporate hypocrisy for too long same as an over 50+ veteran.

A painful outcome of the challenges we face today is the negative impact on travel and business confidence. The accommodation industry is being hit hard as RevPar declines, many times exacerbated by an almost reflexive & unnecessary reduction in pricing in the face of softening demand. When times were good, everyone prospered & looked heroic - some more than others. Similarly, when times are tough, as many of us have experienced, some do better than others to not only survive without a blood bath of redundancies & hiring freezes but come out stronger as caring and well governed organisations that puts the customer at the centre and continues to invest for the upturn. Now is the time to take stock of how we price, how effective are our systems and processes, how prepared are our teams in dealing with market volatility, where are we investing our resources & to what effect, what else can we do besides tightening our belts and anxiously watching our so-called competitors who in-turn are watching you watching them - it's like a Monty Python sketch! The parrot is definitely not pining for the fjords. Our industry is riddled with waste and inefficiency. Most of the time the owners and leaders have the power to change and are beginning to realise that there are options today to bring in experts and adopt solutions that can drive better results. As Mr Satya Nadella commented "what is convenient today is friction tomorrow" (www.afr.com I Thursday 12 December 2019). Data collection and analysis was a dominant theme running through the CEO answers of what will be the most disruptive change over the next decade (Chanticleer CEO survey). As in retail, the accommodation industry is also taking steps, falteringly and slowly in many cases, to become more customer responsive & profitable. It is not just about adopting a holistic cloud- native platform to nimbly connect to a range of apps with speed & cost-effectiveness but also changing hiring practices & job specifications of the traditional commercial roles in the face of automation & technology (Revenue Management, Analytics, Distribution, Sales, Marketing) while ensuring that other stakeholders across Finance, IT, Consulting, Education, Real Estate, Asset Management/Advisory etc all align to the over-arching Revenue Strategy vision of the business rather than watching their own goal post bogged down by baggage. Past experience and qualifications in themselves will be less relevant than the ability to adapt to changing technology which is evolving rapidly.

It's time to question everything. Ditch manual processes where automation works better & replace outdated tech that's eroding your brand, break those departmental "silos" and re-align roles/responsibilities, change ones own mindset and lead by example - or keep giving away control. Let's also ditch the faux-outrage against our distribution partners who thrive off commissions & provide a superior booking experience to the customer or towards specialist vendors who strive to help educate the industry to improve business outcomes or towards other competitors who choose to practice their own unique pricing strategy. Think of who you are and why you exist as a business. Feel outraged if your "Revenue Management" consists mainly of running an excel driven pick up report & some competitor pricing shops with sporadic manipulations of a BAR rate while juggling other tactical tasks and meetings. Feel outraged if you cannot forecast demand or price in near real time per room type per day of week or don't have clean data or analytics at your finger tips or have a weak reputation score or no BI for targeted sales activity or an unbalanced business mix etc etc. All that indignation and outrage can be exhausting - I'd rather we channel our energies in adopting best practices and making a positive difference in our and others lives by increasing our awareness & being open to change. Anyone with the right aptitude and attitude can practice RM with the support of technology. What took hours of manual processing can take minutes. In many cases you may not even need a dedicated Revenue Manager. The way we did things are now outdated, just like the data used in a static environment.