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Revenue Management, Pricing & Capacity Strategy

RM Stories

A continuing story about revenue management, profit, and the questions behind the numbers.

Hotel managers have become very good at improving occupancy, ADR, RevPAR and market share.  But what happens when all of those measures improve and the economic outcome gets worse?

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RM Stories follows Carlos and his team as they try to understand what their commercial dashboard does not tell them.  Inspired by The Goal, the series explores revenue management as a system, one decision and one uncomfortable question at a time.

START HERE

CHAPTER 1

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An Exceptional Quarter

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Carlos and his commercial team have achieved every objective established for them.  Occupancy, ADR, RevPAR, market share and direct bookings are all improving.

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Then the ownership representative asks one question no one in the room can answer.

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CHAPTER 2

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A High-Value Group​
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Carlos goes looking for the people who serviced the business the commercial team sold. The group was unquestionably valuable, but not necessarily to the hotel.

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CHAPTER 3

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The Cost of Going Direct​

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Direct bookings increased and commissions fell. It looked like exactly the result Carlos had wanted.

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CHAPTER 4

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Everyone Was Right​

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Every department was doing exactly what it was supposed to do. The problem was that their objectives didn’t all point in the same direction.

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CHAPTER 5

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Closed to Arrival

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Carlos finds fourteen nights marked as sold out, but the number of rooms sold is different each time. He follows the numbers to a decision everyone has been making and no one has thought to question.

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CHAPTER 6

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Running Badly on Purpose​

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The hotel turns away guests on its busiest nights while perfectly good rooms sit empty. Carlos proposes spending more money to make those rooms available.   He discovers why doing the right thing can make the numbers look worse.

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CHAPTER 7

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No One's Number​

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The hotel posts its busiest Saturday ever, and every department hits its target. But guests are still standing in the lobby with their bags. Carlos discovers that the hotel measures every task it performs, but nobody owns the outcome that matters: getting guests into their rooms.

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CHAPTER 8

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The Better Hotel​

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Carlos has finally built a better hotel. Profit is up and the departments are pulling in the same direction for the first time. Then Diane comes back with the question that started it all, and this time the answer isn’t in the hotel’s numbers but in what actually reaches the owner.

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