World Panel
Viewpoint18 March 2020

Has forecasting become a lost art?

Revenue Optimization

— 10 experts shared their view

share this viewpoint
Has forecasting become a lost art?
This viewpoint was created by
Scott Dahl, Program Director, Master’s Degree in Hospitality Strategy and Digital Transformation at Les Roches Global Hospitality Education
Ari Andricopoulos
CEO of RoomPriceGenie

Without a forecast it is difficult to understand all of the revenue opportunities for a hotel and how to weave them into a single, successful revenue strategy. Creation of this strategy has two components. The continual, repetitive forecast update process that is needed to adjust tactics to make the strategy come true is clearly better accomplished by automation. Here software can both save time, and create better forecasts by consistently applying the will of the revenue manager.

But the human brain is far better at creation of strategy, especially in the face of change. The Coronavirus presents an example of a situation with many (unknown) unknowns and potential uncertain future shocks (and even elements of game theory relating to the surrounding hotels). It is difficult to accurately program an algorithm to understand these dynamics.

At RoomPriceGenie, we believe that software will, for the forseeable future, always be a tool of the revenue manager to automate their strategy, rather than a full replacement. We also believe that the more transparency about the calculations, the easier it is for the revenue manager to add their own strategy and react to unusual situations. Our software is built with this in mind.

TLDR: Strategy is for the humans and calculations are for the machines.

see 9 more views

Advertisements