When did you leave Hyatt and what did you do in the meantime?
I left Hyatt at the end of last year. Since then, I have spent my time traveling, seeing friends and family, learning Spanish and doing many of the those things which, in the past, I put on the low burner. In June, I'll bring my entire close family to Japan to visit my family-in-law. That will be an interesting, fun, multi-cultural gathering – and a first-timer.

Tell us a little bit about your education and school time. Where did you grow up?
I grew up in Switzerland, exposed to the Swiss-French and Swiss-German culture by family and education, went to commercial school in Zurich, then moved to Lausanne and graduated from Lausanne Hotel School in 1995.

At what time did you first get involved with the hotel business?
Hmm... At the age of 3, I fell into a hotel swimming pool and carry that scar ever since. But more seriously, I never thought I would go into the hotel business until shortly before starting hotel school. I fell in love with it very quickly.

How exactly did your career with Hyatt start?
I was lucky enough to get one of those popular Hyatt management training positions in Bali. After that, I got a choice to either follow an F&B or rooms / marketing track. I chose the latter which, unknowingly, paved my career path to Revenue Management and Business Intelligence. From there it went like a fast train; corporate trainee and marketing analyst in Bali, then marketing and revenue management positions in Cologne and Paris before I was offered the Revenue Management Director position at Hyatt's EAME office in Lausanne. That was right when the first serious revenue management push was in its planning phase – great timing paired with a bit of luck.

When did Hyatt start to seriously work with Revenue Management? How did you have your first “touch points” with this area?
Hyatt International started to use RMSs around 1996. At the Hyatt Regency Paris, I worked with one of the first two RMS installed in Hyatt’s international arena.

What was the initial strategy of Hyatt for Revenue Management? Did they start to put manual processes in place at the beginning?
To be honest, in the very beginning, it wasn’t a structured approach. It was a bit like the gold rush. There were tools we tried hard to understand – with more or less success – and putting restrictions in place manually basically at the Revenue Manager’s discretion. It did not take long however, until we had a set of serious processes in place, changed to a significantly more efficient RMS and had the RMS, PMS and CRS “talking” to each other seamlessly.

How much attention was paid to align the processes and procedure for Revenue Management with the operations?
It became clear very soon, that efficient revenue management has to go hand in hand with operations. We therefore made sure from the beginning that Rooms, Sales, Reservations and the Executive Committee were involved in the training and the implementation phases. We also held seminars for regional staff and general managers before we rolled-out any region. I believe this is one of the things we have done well. RM is a team effort. The better a hotel team understands the issues, the more successful it will be in creating a Revenue Management culture.

At what time did Hyatt start looking at technology and systems?
Hyatt International started to look into technology, I believe, around 1996 after we had some RMSs running in a few hotels without the desired results.

Why was the first round of implementations not a great success and what conclusions came out of this test?
For many reasons; unstable systems, not accurate enough PMS data, insufficient training, a lack of clearly defined processes and procedures and no possibility to write length of stay restrictions to the reservation system automatically. The industry, till today, underestimates that last point. To give an example; Hyatt's RMSs take average per hotel about 90'000 decisions, daily! Only an automated communication between the RMS and the reservation system can do this efficiently. Manual processes do allow to improve revenues, don't get me wrong, but they do leave a likely not irrelevant part of the revenue potential untouched.

The selection of Hyatt’s current Revenue Management technology partner has happened pretty soon after the first phase? Does this mean it became clear very soon that a recommendation technology did not deliver the real value Hyatt was expecting from scientific solutions?
Absolutely. The choice of going for a scientific RMS decision solution rather than for a recommendation system was one of the key factors! It became clear, that we wanted the core RM function, to put LOS restrictions accurately in place, to become an automated process. We thought that a revenue manager's time should be spent supporting revenue-generating initiatives, helping management to decide on where to spend the limited marketing and sales resources, with the best possible return. To make this possible, we had to get the restriction upload out of the revenue manager's way. But don't get me wrong, it is crucial and still necessary to control the machine, to evaluate the forecast's accuracy. But if the forecast is “good” according to all information available, the restrictions should upload automatically.

What else played a role? Apparently the top quality of resources and services on all levels of the RMS partner made a true difference as well?
Of course, we wanted a provider which was able to support the initial roll-out phase, from a technology development and support but also from a training point of view until we had our own resources available.

How did you roll-out, implement, train and maintain the systems?
This has evolved quite a bit over time. In the beginning, we decided to visit hotels four times. Once for data collection and understanding, once for general training, once for operational training and implementation and once for addressing the challenges before they get out of hand (smiles). I am convinced it was the right way to introduce new technology and processes. Today, since basic RM knowledge is often already available at property level and technology has further developed, initial trainings are conducted on-line and only one on-property training is scheduled; more visits are scheduled only if needed.

What benefits did you typically realize at the properties – both tangible and non-tangible? Did the owners see the value in terms of financials as well?
As you know, benefit measurement is challenging, owners are not always willing to listen and / or understand. Benefits vary tremendously from hotel to hotel and from market to market. In favorable market conditions, we have seen revenue increases up to 10%. Those increases typically have a much higher impact on profitability.

Do you believe there is a big competitive advantage of having a next generation solution installed at as many hotels as possible?
I believe there is a necessity to put in place appropriate revenue optimizing processes in any hotel. Today, it is irresponsible not to. But how exactly those processes look like will vary from one hotel to another. If a hotel fulfills the criteria to install an automated solution and if it is done well, it will certainly have a significant impact on revenues and profits, no doubt.

How significant would you rate the value of RMS technology comparing “Recommendation” vs. “Scientific Decision” systems?
There are a couple of inter-related elements which make RM efficient; Appropriate training and processes, good data, a solid forecast, skilled staff , support from all management levels and a healthy economic environment. If these elements are given, I am convinced that a scientific decision system able to load restrictions automatically onto all relevant distribution channels has a significant impact on revenues. According to my experience, it is very difficult to use the potential of RMSs in a manual or “recommendation only” environment. This is particularly true for properties which work with full pattern length of stay restrictions.

Would you take the same decision again for any future hotel group you would be working for?
If the economic and technology environment is appropriate, I would certainly take the same decision.

In what areas would you change things?
It has proven rather difficult to find, develop and keep skilled staff in hotels. I would likely centralize business intelligence functions, which include revenue management, contracting support, pricing and distribution, and push the relevant information to each property. I also see the general training in the above mentioned areas more and more dispensed in an electronic format customized for the individual staff member trained. I would conduct on-property training on hotel or market specific topics only. But then I am convinced that every hotel needs a flexible approach depending on skill level, market conditions and technology available.

What do you intend to do in the future? We are sure you have been approached by many companies – have you made a choice yet?
There were options indeed. I have decided to start my own hospitality consulting company based in Zurich providing services in the field of business intelligence as I have defined it before. I will be looking for individual hotels or hotel chains which want to increase their revenues applying an optimal, modern mix of revenue management, pricing, dynamic contracting and distribution. My company will help finding the right mix and assist a successful implementation.

Philippe, thank you very much for your time.