Actabl’s Adam Glickman, vice president of brand strategy, explains how technology can turn data into actionable insights that boost the bottom line.
Today’s hotel operating climate is fast-changing and unpredictable. At a time when intra-day headlines can rewrite macroeconomics or reset local asset values, hoteliers need to strategically choose and use a suite of tools to maximize ROI and gain that crucial competitive edge. Leveraging technology — specifically business intelligence, forecasting and labor planning applications — is increasingly becoming the winning success strategy for identifying and optimizing opportunities in every operational landscape.
“Data is important, but data is overwhelming. Translating data into actionable insights is the key,” said Adam Glickman, vice president of brand strategy for Actabl. “Looking toward the future, choose technology that isn't going to just give you data; choose technology that's going to give you actionable insights that will drive your business forward.”
Glickman detailed five core operational considerations for which technology can harness data and provide much-needed insights to help hotels move the ROI needle up and to the right:
1. Long-term CapEx planning: Based on the kinds of assets in a portfolio, the opportunity here is to benchmark when the CapEx spend needs to happen, how much that CapEx spend needs to happen, what that CapEx should cost and where the right point lies in determining when it's more worthwhile to stop investing in OpEx. Instead of that being a time-consuming subjective, manual process, tech quickly identifies patterns and trends that guide long-term CapEx planning and flag exactly what needs to happen, and when and how to use that information to develop the right-sized budget.
It’s also important to pinpoint precisely where a hotel team has requested CapEx dollars that have not been deployed. Technology platforms can track these details and present the information as a snapshot or series of snapshots or an overview rather than relying on a decentralized system of multiple spreadsheets and materials that have accrued over time. Investors can clearly see the issues that arose in the past and how they've been addressed, providing necessary information for the purposes of asset planning.
2. Short-term OpEx spend: Labor is a primary cost center when looking at OpEx. Tech can assist by using data to teach teams more about when and how they need to perform their respective functions and how to use that knowledge to increase efficiency. Teams will be more productive as a result, performing specific sets of actions in sequence. This framework also breaks down silos and brings together maintenance, housekeeping and revenue management teams to ultimately increase productivity and lower the risk of suboptimal performance that can result in actual or incremental revenue losses.
“That is the short-term OpEx value-add that technology brings: It unlocks the ability to ensure your near-term OpEx investment is always supporting the ability to maximize revenue, especially during peak demand times,” said Glickman.
This strategy applies to guest satisfaction, as well. If the data reveal certain issues —for example, air conditioning malfunctions that are a common cause of guest complaints in certain sets of rooms — and there's preventative maintenance that will alleviate those service interruptions, hoteliers are empowered to schedule that preventative maintenance regularly before guests have a negative experience. That simple change will prevent guests from having to switch rooms, thus reducing the operational burden on the front desk and boosting guest satisfaction.
3. Labor optimization: When it comes to contract laborers and overtime, there is a fine line for hotels to walk in terms of managing teams and building engagement while weighing how much contract labor to use, when to use it and how much overtime to use. The opportunity for technology-based optimization centers on working with a technology partner that provides direction on software and tools that track the overall labor spend. Rather than looking at contract labor in a vacuum, a hotel operator should look at the property's entire labor spend – staff employees' overtime and contract labor – side by side.
“If you know how much that contract labor is in parallel with your own costs, you can decide when it might make sense to consider offering overtime, engage with team members to swap shifts or potentially have a non-traditional schedule that gets the work done. You may find you don’t need contract labor,” said Glickman.
“Optimizing labor now comes down to this mix of scheduling and enabling team members to schedule their time flexibly,” he added. “It enables the operator to use data to determine when to use overtime and understand the metrics that define why they should be okay with that ― because overtime might actually cost less than contract labor.”
...choose technology that isn't going to just give you data; choose technology that's going to give you actionable insights that will drive your business forward.”
Adam Glickman
4. Team engagement and scheduling: The labor market has changed dramatically. A top strategy to increase retention and decrease turnover is to have a focused engagement and scheduling plan that connects the manager(s) with their team(s). A tech-enabled engagement platform is critical to decreasing turnover among team members.
“You can maximize the overall business value in operations in today's climate especially by recognizing that the world has changed,” said Glickman. “There are variations and considerations managers and their staffs have to work around in many cases.”
A staffing engagement platform enables team members to have the shifts they actually want and that work within their lifestyle. It also makes it easier to communicate with their manager(s) and other team members. For example, tech enables employees to swap shifts without requiring complicated processes or creating undue stress. Within Actabl’s Hotel Effectiveness platform, a tool called ShiftSwap lets team members swap shifts quickly and seamlessly on their mobile devices without tapping their manager to facilitate the schedule change.
5. Labor planning around forecasted demand: Marrying staff planning with demand forecasting is critical to maximizing profitability. A thoughtful business intelligence tool can take a hotel’s data and combine it with metrics that allow benchmarking across a portfolio. Using this forecast, hotels can then consider how much potential exists for profit when factoring in labor costs and the profitability threshold.
“When using technology to rapidly and regularly update a hotel’s forecast based on marketplace trends, operators can then update scheduling and staffing against that forecast, versus static schedule planning,” said Glickman. “It's another lever to pull that further moves operations from manual processes to more automated processes that guide managers on the actions that they should take to maximize profitability.”
Brendan Manley is a writer, editor and digital marketer specializing in hospitality content creation based in Warrensburg, New York.
The views and opinions expressed in this column do not necessarily reflect the opinions of Hotel Investment Today or Northstar Travel Group and its affiliated companies.