The hospitality and gaming industry has made dramatic progress in using data and analytics to advance the balance between guest experience and profitability. Technologies such as cloud computing, high-performance analytics and data visualization have redefined what is possible, how fast it can be done and how readily it can be shared. However, there is a lot more potential that remains untapped because many organizations lack a culture where teams understand, value and demand fact-based decisions and strategies.

To some extent this is being driven by a lack of clarity regarding how to successfully implement an analytics approach in a hospitality organization. Many executives think that analytic tools will magically transform their organizations into data-driven analytic enterprises. However, those organizations that successfully implement analytics do not just rely on the tools themselves. Those organizations that are able to succeed with analytics do so by infusing analytics into the core of their business.

For hospitality organizations, this means demonstrating a clear vision, a willingness to evolve and the ability to follow where the data leads. Organizations that do not have analytics as part of their corporate DNA must cultivate a similar mindset. How? In this article we will explore the six steps to making analytics work for your organization.

1. Curate and Govern Your Data

Data is the foundation for analytics and requires creating, cleansing, storing and accessing information from across your enterprise. That means more than just being able to get to your data. It also means building common, agreed-upon definitions of key metrics, so that when executives review information they can spend their time making decisions rather than arguing about definitions.

Business analytics is about using data to discover insights that change the way a hospitality organization operates – elevating it to a data-driven organization. Without a strong foundation of reliable and accurate data, results are suspect, and buy-in becomes impossible. A sound data management strategy puts you on the road to analytic success by giving you full confidence in your data.

2. Apply the Right Analytic Techniques

You can start with the best and brightest data and still mess it up along the way. It’s really important to use analytical methods to dial out the truth and understand what is and is not accurate. For analytics to truly be a game changer, hospitality organizations need to recognize the difference between reactive and proactive decision making. Using your data to create reports, drill-downs or alerts helps you to keep a finger on the pulse of your business. But these things only show you what has happened. They will not tell you why the problem is happening or what effect it will have in the future.

Predictive analytics, like forecasting and optimization, can help you figure out why things are happening, show you what will happen next, or even lead you to the best alternative action, considering all of your operating constraints. Hospitality organizations that use predictive analytics to move from reactive to proactive decision making can change the way they operate. They are no longer fighting fires. They cease to be surprised. Instead, they can stay one step ahead of trends, set strategy and achieve goals. They gain advantage over the competition, increase value to shareholders, and continue to surprise and delight their guests.

3. Start From the Outside In

Many analytic projects, in particular those that fail, start from the inside out. Many projects start along the lines of “we have all this great data, let’s figure out some applications we can develop to use it.” However, analytics initiatives need to start and end with the business, not the data. Why does your organization need to be empowered with analytics? What problems are you trying to solve? What information gap is keeping you from making a data-driven decision?

Analytics initiatives need to start with business consultation, then move to data preparation and data cleansing, then to using the right analytic methods to accurately answer the question at hand. To close the loop, analytic insights are delivered consultatively to the business to help clarify the analysis that was done and how to interpret the results.

4. Build and Focus Your Analytic Expertise

With the surge in demand for analytic expertise, even large and well-funded organizations have major talent gaps. Skilled data scientists are in short supply. Those with a hybrid background in analytics as well as hospitality and gaming are rare. A focus on data-driven decision making involves finding the right balance of resources that have both business acumen and analytical rigor. Make sure you have enough of each so that the analytics meet the needs of the business, and the business can be supported by the analytics strategy.

Most organizations have pockets of analytic expertise, but you can gain greater synergies and economies of scale by bringing your teams together to focus on the most important analytical approaches and problems. A centralized approach can be very effective as long as the focus on analytics is not at the expense of business acumen. Ideally you would use a centralized approach when you are able to partner with specific business verticals where there is a deeper business acumen.

5. Make Analytics Business as Usual

Analytics needs to be managed as a core business practice, not as a one-off project. Analytics should be integrated into the very essence of how you do business, and enable and contribute to your company’s core goals and objectives. Collaboration between departments and users means decisions are made considering all possible information, not just what is available to one department. Aligning analytic programs and research projects with identified business objectives and goals is the best way to use analytics to inform the business strategy.

6. Deliver Analytics to the Front Lines

Analyzing data and displaying the results with graphs and charts makes patterns, trends and outliers easily visible. Analytic visualizations are critical to gaining fast insights from your data. If sophisticated analyses can be performed quickly, even immediately, and results presented in ways that showcase patterns and allow for querying and exploration, people across all levels of your organization can understand and derive value from massive amounts of data faster than ever before.

Faster insights also drive better results. Business issues don’t wait around for solutions. If you don’t have the analytic process in place to solve issues when they occur, it can disrupt the value that you can deliver to the organization. Getting the information in the hands of the decision maker when they have the need increases the value delivered by analytics and can reinforce your culture of data-driven decision making.

Getting Started

The use of analytics is becoming more widespread and more accessible for hospitality companies. Analytics is not just the concern of revenue management, but is becoming standard operating practice in marketing, operations and finance. Analytics can go a long way toward achieving that delicate balance between customer service and revenue and profits.

Cultivating an analytic culture and embracing data-driven decision making is no small feat. It’s easy to get lost in the hype or become discouraged, especially when dealing with often inflated expectations for immediate outcomes associated with analytics. The process of implementing game-changing analytics is a journey that must be taken one step at a time, and sometimes that first step is the hardest. If you are just getting started on the road to data-driven decision making, take a small, answerable problem from one section of your data universe, and focus your analytics efforts on that.

Natalie Osborn is senior industry consultant for SAS Institute’s Hospitality and Travel practice, and an 18+ year veteran of hospitality and hospitality technology solutions development, specializing in analytics and revenue management. Prior to joining SAS, Natalie was the director, product marketing for Minneapolis-based IDeaS Revenue Solutions, where she worked from 2000 to 2011. She is a frequent contributor to industry publications, speaker at industry conferences and is co-author of the SAS and Cornell Center for Hospitality Research blog, “The Analytic Hospitality Executive.”


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