WHY COMMERCIAL EXCELLENCE IS KEY TO HOSPITALITY SUCCESS
On Wednesday 9 November, around 40 senior hospitality executives and a few rising leaders gathered at the London Hilton on Park Lane from across Europe to review emerging trends and share best practice.
The invite-only event – our second Curate event of the year – brought together key industry players from sales, marketing, revenue management and business intelligence to discuss how closer alignment between these disciplines is driving commercial excellence.
Living in a ‘VUCA’ world
The Curate’s moderator, Michael Nowlis – Programme Director for the University of Cambridge Institute for Sustainability Leadership (CISL) and HSMAI Europe Chair – kickstarted the afternoon’s programme by explaining the relevance of the VUCA military term in the current hospitality climate.
With the acronym standing for volatility, uncertainty, complexity, and ambiguity, he highlighted its connection with industry challenges – from disrupted supply chains, recruitment struggles and record inflation to the ongoing impact of both Covid-19 and climate change – and why it’s never been more critical for businesses to adapt quickly in this fast-changing world.
“We’ve come out of two and a half years unlike anything we’ve lived through before in travel, tourism and hospitality. These are unprecedented times, and yet it feels like business is still moving in the right direction.”
Michael Nowlis, Programme Director, Executive Leadership Programmes, CISL, University of Cambridge and Chair of the HSMAI Europe Board of Directors
How data impacts our industry
Remy Merckx, Senior Advisor – Head of Travel & Hospitality at eClerx, started the first session with the message that you can’t run a commercial organisation without data, but that its decentralised nature in our industry makes it more complex to harness its full potential.
At a time when hospitality is balancing the increasing demand for customer personalisation with more robust data privacy requirements, Remy highlighted some of the competing forces reshaping the way data impacts our relationships with customers. In addition to revealing the industry tools and trends – including trip stacking, predictive forecasting and zero-knowledge advertising – to best manage these, he spoke of the shift towards a ‘Token Economy’ which stands to revolutionise loyalty programmes.
From the importance of clean data and the right management tools to how AI and blockchain technology could impact hospitality, Remy used his presentation to remind delegates of the need for our industry to keep the emphasis on the use-case to ensure we’re always clear how our product offerings stand to positively benefit customers.
“In general, when we talk about analytics we think web, and maybe how we evaluate the customer journey. But it’s everywhere now, and impacts the entire customer experience journey, helping us better manage resources. What’s key is to listen to what customers are feeding back to understand what they want, and how they want you to interact with them.”
Remy Merckx, Senior Advisor – Head of Travel & Hospitality, eClerx
At a time when our hospitality industry is ripe for change and many of our most commonly-used systems are 40 years old, it was inspiring to hear more about the potential for well-managed data to deliver the next generation of customer experience. And he gave attendees plenty of food for thought. Might consortium blockchains allow the industry to modernise faster, eventually becoming the new standard technology we all rely on? Might its anonymized, secure and data-rich qualities replace today’s social media players?
Using data to build a sustainable future
The second expert-led session was delivered by Accor’s Shumi Khan and James Wheatcroft, who explained how they’ve overcome the widespread tendency to work in department silos to build a commercial-centric business.
“Historically there’s been some conflict between how revenue managers focus on the bottom line and marketing teams lean towards innovation. With business intelligence, a common way to measure goals and KPI alignment as drivers, we’ve moved on from frenemies.”
Shumi Khan, Global Vice President for Business Performance & Revenue Management, Accor and Chair of the HSMAI Europe Revenue Optimization Advisory Board
Sharing experiences from the last few years, they explained how Accor has focused on aligning thinking, introducing a data-driven approach and encouraging people to embrace new ways of working to successfully navigate the complex commercial environment.
Through multi-scenario planning and an acceptance that they need to expect change, the company was able to inspire a more agile approach at a time when the world was getting infinitely more complex. This saw the hotel company move away from annual plans and static budgets to cross-commercial quarterly planning and a more global perspective – including baseline simulations and a full-funnel marketing approach – that allowed them to better capture commercial opportunities.
“The pandemic showed us that there is always an opportunity to work together in a different way and create an agile environment where we can spot early signals and act.”
James Wheatcroft, Senior Vice President Brands, Marketing and Content, Northern Europe Accor
The duo highlighted how senior ‘buy in’ and aligned leadership is key to taking everyone on the journey. By constantly building capability, using simulation modelling and ensuring they could always access the best possible data proved invaluable before taking important decisions.
They also explained how a mix of upskilling in technology, educational workshops, using outside consultants for ‘a fresh face’ to deliver new approaches, plus ongoing reinforcement of the business message helped them create an agile and commercially-competitive environment.
Accepting that it may often feel like we are drowning in data, they described how a holistic, single-minded view on performance – plus a better understanding of the cross-brand impact of activity – helped embed commerciality within the business, and better align their commercial journey.
“Sometimes using data isn’t foolproof. But the idea is to move away from a blame culture, keep an open mind, try new things and learn. The nature of the journey is iterative, and we can always do better. We need to understand the why if something doesn’t work and learn from our successes.”
Shumi Khan, Global Vice President for Business Performance & Revenue Management, Accor
The final part of the afternoon saw delegates share thoughts around the biggest knowledge, skills and competency gaps required for commercial excellence. It was encouraging to discover that the hospitality industry is already breaking away from old ways to increase collaboration, with most delegates indicating some degree of cross-functional working in their business.
As with all our curate events, one of the biggest benefits came from our table-talk discussions, which encourage healthy debate. It was therefore beneficial to hear alternative views shared around the biggest obstacles and enablers to commercial excellence. Suggestions ranged from demonstrating how skills are transferable to help overcome recruitment challenges to investing in centralised data platforms, and from the trend towards cluster roles that better align team goals to reviewing funding and fee structures.
“Theoretically, owners and management have the same objective. Maximising profit levels and GOP is in both of their interests, unless either party is very short-term oriented.”
Michael Nowlis, Programme Director, Executive Leadership Programmes, CISL, University of Cambridge and Chair of the HSMAI Europe Board of Directors
The message that shone through the day was that hospitality has evolved significantly since the pandemic took hold. Hospitality has long been a resource-intensive sector, so technology such as machine-learning stand to increase efficiencies and drive incremental growth.
And, with change set to come even quicker than before, it’s never been more important to use data to help plan for multiple scenarios, spot early trends, and adapt commercial strategies swiftly. Our industry has changed radically, and the day’s event’s discussions reflected the need to continue learning, unlearning and relearning in this increasingly dynamic world.
