Best of both - EHMA president Hans Koch

16 December 2016

EHMA president Hans Koch explains the importance of balancing good revenue management with employee engagement.

Revenue management became very important in the airline industry during the difficult years of the 1980s. In those times, airlines were under big competitive pressure, and needed to find ways to increase their overall performance, operational efficiency and financial results.

In the hospitality industry, revenue management took an important role only towards the mid-1990s. To be competitive and successful, the focus shifted from an analytical to a more strategic approach. As a valuable tool to not only maximise high-season demands, good revenue management also helps to stimulate demand during low periods while avoiding rate cannibalism. So, revenue management obviously gained importance very fast, as it effectively helps to cope with rapidly changing consumer demands and expectations, optimises inventory and rate management and maximises revenue.

The basis of good revenue management is being proactive and not reactive. It challenges operators to use resources effectively in order to gather information about customers. It is a great tool to anticipate and influence consumer behaviour, offering the right product to the right customer at just the right time and rate.

Good, up-to-date revenue-management concepts – well-educated key users of such systems – are a smart investment that allows a hotel to be more efficient and successful in today’s challenging and competitive economic environment.

The defining experience

Yet good and flexible rates, apart from location, are probably not the only criteria for guests when choosing a hotel.

Most of our daily decisions are based on emotions and our brains react faster than we can imagine. Within fractions of a second, spontaneous decisions are taken according to how we feel, based on questions like ‘does the hotel have the right value for money or location; will I get good service; does it have a good design; and how does it measure up in terms of trends and prestige?’.

All these criteria influence a guest’s perception, decision and choice, but what really makes a difference to the final experience at a hotel is, without doubt, employees with the right service attitude and approach, who love and perform their job with passion.

Highly motivated employees trigger positive reactions and good feelings that, in turn, have a sustainable impact on key performance indicators, such as customer loyalty and satisfaction, and thus on potential return guests. On the employee side, it impacts motivation, satisfaction and productivity on the job. What else can be more efficient to successfully grow your business and differentiate yourself from your competitors?

Therefore, it is very important today to implement employee and guest satisfaction surveys to measure employee engagement, training and retention, as well as guest satisfaction among an increasingly discerning clientele.

At the same time, such surveys help to evaluate and pinpoint business trends, and can positively support the process of defining the right strategy and operational decisions to successfully move a business forward.

Well-structured satisfaction-measurement systems and tools, combined with a modern human-resources management approach, can successfully support efforts to effectively recruit and retain qualified and motivated employees, and, at the same time, help to increase guest satisfaction and loyalty.

EHMA president Hans Koch’s tips for effective employee management

  • Define a well-thought-through set of company values and goals.
  • Implement and apply an effective revenue management system to optimise business performance.
  • Ensure recruitment of qualified employees with the right attitude in order to achieve top employee performance and motivation, and, ultimately, the highest possible level of guest satisfaction and loyalty.
  • Smart investments into hardware and good employees are of equal importance, and a must for achieving successful business performance.
  • Happy and passionate employees are not only key to building a good base of loyal return guests; they are also very important for achieving successful and sustainable business performance in today’s increasingly challenging economic environment.

Hans Koch is president of EHMA and official delegate for EHMA’s Swiss chapter. Throughout his 35-year career, he has worked at hotel operators all around the world, ranging from Hilton International to ITC Hotels. He is also CEO of KKL Luzern Management.

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