Decision intelligence: turning hotel analytics into action

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BI (Business Intelligence) is an organization's ability to track the flow of data to identify opportunities, mitigate risks and optimize the way it does business. Most companies – not just hotels – have not yet reached this optimal level of BI maturity. Many have automated data collection, reporting, and in some cases data visualization. But that doesn't mean they mobilize data into action. Very often, users only use their BI platforms to schedule reports that are emailed to them in their inbox, but reports alone do not constitute business intelligence. So they are still stuck in static spreadsheet mode when it comes to decision support. More advanced users use BI tools to increase their speed of discovery within the BI portal, but then spend hours re-sharing and explaining their findings to others not in the same environment. They often have long discussions with colleagues to find out, "Why don't your numbers match my numbers??" (Weekday vs. Date, company profiles vs. Negotiated price codes, timing of data collection, filters by different dimensions – possibilities abound!).

Looking at automated scheduled reports is certainly a step in the right direction and even better when hotel teams are examining data to make informed decisions. However, the shortcomings of today's use of BI are clearly visible.

Enter decision intelligence (DI)

Cassie Kozyrkov, chief decision scientist at Google, describes DI as a way to complement data science with social science, decision theory and management science. Making it more effective in helping people actually use BI data to make better decisions. A great analogy she uses to describe the difference between data science and DI is comparing those who make microwave ovens to the cooks who use them. Note that by "data science" it refers to analytics delivered via BI platforms. Simply put, DI is an enabler for the end goal of BI – identifying opportunities, minimizing risks and optimizing your business operations.

First, it is important to note that BI and DI are not just technologies, but rather evolving organizational skills. To be successful, you need a data-driven culture, people and tools. You can't buy the first two off the shelf from any technology vendor. They must be understood as strategic organizational goals. Once that commitment is made and you are actively working towards it, there are four ways you can get much further with your data than simple self-service BI reports:

1. Centralize and correlate

Hoteliers today work with a flood of valuable data from their transactional systems ( PMS , POS etc.) as well as with market intelligence from a variety of third-party sources ( STR , Kalibri Labs , Knowland, etc.). However, very few can actually correlate their channel mix (and many other business dimensions) with something like their STR Market Penetration Index (MPI). That's because this data sits in its own silos most of the time, and no one can see how one affects the other. So the obvious first step to unlocking such insights is to centralize all this information on a BI platform that then allows users to collect, layer and correlate different types of data to get a holistic view of the business. In the following example, users can see how their segment, channel, and room mixes changed and impacted their STR indices as they move through the time slot.

Source: HotelIQ STR Dashboard

2. Visualize and interact

One of the worst habits people develop with spreadsheets is to condition themselves to look at certain cells on a wall of numbers. They look at the same reports and regularly glance at the same cells to monitor the health of their business. Therefore, when presented with a BI tool, their first instinct is to automate their reports. They still want the wall of numbers laid out the way they have conditioned themselves to read and think. However, a great side effect of such conditioning is that they miss out on all the threats and opportunities that are hiding in plain sight. For example, how likely is it to spot a white tiger hiding in a crosswalk?

Similarly, a miscoded price code can get buried in a sea of reservations. If you see a drop in ADR totals, significant damage may have already been done. Instead of looking over a wall of numbers, what if your price codes were displayed in a scatter plot? It would highlight to you which services are performing worse than expected and which are performing better. Then imagine clicking on an action and having the information you need to take it literally at your fingertips!

Source: HotelIQ Agency Trends

3. Analytics-driven collaboration

We all know digital workplaces. If we weren't before, the pandemic has forced us to collaborate digitally. From Sharepoint to Slack to project management portals, all facilitate collaboration between teams. However, when it comes to sharing data and insights, most of us still rely on extracts and spreadsheets. As a result, teams spend an inordinate amount of time trying to find a single version of the truth that everyone can agree on before taking decisive action. This is where you need an analytics-driven digital collaboration platform – a portal or intranet where your strategic teams log in daily to work, access a single version of the truth (through automated data integration), share, comment, plan and track performance. In addition, the digital collaboration offers many other advantages .

4. AI-powered decision support

Once you have centralized all your data and your team is able to explore, share and collaborate easily, the next obvious step is to determine what actions to take. This is where AI can greatly enhance your decision-making capabilities by processing historical and current data trends to highlight the risks and opportunities ahead of you. However, we are often fixated on the accuracy of AI predictions. If the pandemic has taught us anything, it's that no one has a crystal ball that can accurately predict the future. Instead, we need to focus on the reliability and appropriateness of AI's input into our decision-making process. It may not be able to predict a pandemic, but can certainly highlight unusual activities that require your attention much faster than a normal human being. Let's put it this way: if you have a junior analyst who is very thorough and meticulous, the CEO would leave all the decision making to her? AI is like this analyst and should be treated the same way – pay attention to what AI is telling you and then make informed decisions.

Source: HotelIQ Risk to Achievement Dashboard

Eventually, technology and decision science will evolve. There will be even more sophisticated ways to enable the consumption of information by companies and allow them to leverage it. Unlike tactical technologies like a phone or a refrigerator, however, there is no leap when it comes to an organization's analytical capabilities. The longer you delay building this culture and implementing these solutions, the harder it will be to stay competitive in the information age.

Sameer has an extensive background in hotel business intelligence, data management, product management and customer support. He has worked for TravelClick and The Jumeirah Group and, prior to joining Intelligent Hospitality, was a business intelligence consultant for Four Seasons Hotels& Resorts. He holds a BS and MS in Hospitality Management from the Conrad N. Hilton College at University of Houston.

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