Research Paper
Masekella Cato
Asset Risk and Revenue Management
Professor James Turley
Case 12
1. In this scenario, the resort’s DOSM and RM work closely together to meet their respective goals. In many cases, the explicit goals of these two functional areas are identical. Identify two specific instances in which the interests of these two areas could be in conflict.
• Revenue Management as a Resource—The revenue management department should be situated so that they can offer valuable data and analysis to aid the decision-making process on issues such as: group acceptance, pricing, marketing tactics and goal setting, for instance. The directors of sales should use the RM as a business partner. Not utilizing Damario as a business partner can lead to failure
• • Educate—The RM may not have a complete understanding of the sales team’s structure and processes. The director of sales can proactively seek to educate the RM to ensure they fully understand why the team is set up the way it is and what the sales process entails.
How important do you think it is for a company’s revenue manager and its sales and marketing functions to work closely together? Explain your answer.
Revenue management is a vehicle to help hotels to become aware of the rooms they sell, the rates at which they sell, and the pace at which they sell. It is a way hotels can become pro-active in the selling process, rather than simply posting rates and waiting for them to be sold. Revenue management utilizes innate as well as analytical skills; these skill sets develop with practice. The mentality of a good revenue manager or team is focused on producing a good blend of occupancy and average rate. The hotel’s mission should be to construct a base occupancy, through a good mix of rates, and then take advantage of having a base by then locking out lower rates to build average rates.
The mission is not to only get 100% occupancy; it must be to get occupancy as high as possible, with an average rate as high
Asset Risk and Revenue Management
Professor James Turley
Case 12
1. In this scenario, the resort’s DOSM and RM work closely together to meet their respective goals. In many cases, the explicit goals of these two functional areas are identical. Identify two specific instances in which the interests of these two areas could be in conflict.
• Revenue Management as a Resource—The revenue management department should be situated so that they can offer valuable data and analysis to aid the decision-making process on issues such as: group acceptance, pricing, marketing tactics and goal setting, for instance. The directors of sales should use the RM as a business partner. Not utilizing Damario as a business partner can lead to failure
• • Educate—The RM may not have a complete understanding of the sales team’s structure and processes. The director of sales can proactively seek to educate the RM to ensure they fully understand why the team is set up the way it is and what the sales process entails.
How important do you think it is for a company’s revenue manager and its sales and marketing functions to work closely together? Explain your answer.
Revenue management is a vehicle to help hotels to become aware of the rooms they sell, the rates at which they sell, and the pace at which they sell. It is a way hotels can become pro-active in the selling process, rather than simply posting rates and waiting for them to be sold. Revenue management utilizes innate as well as analytical skills; these skill sets develop with practice. The mentality of a good revenue manager or team is focused on producing a good blend of occupancy and average rate. The hotel’s mission should be to construct a base occupancy, through a good mix of rates, and then take advantage of having a base by then locking out lower rates to build average rates.
The mission is not to only get 100% occupancy; it must be to get occupancy as high as possible, with an average rate as high