Simple Ways to Use Analytics to Improve Performance

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October 01, 2013
Analytics for All
Samuel Ayisi - samuel.ayisi@nyansapor.com

How mid-level hospitality managers can use analytics to improve performance

Over the years, I’ve found that the use of analytics is significantly lower among mid-level management than executive-level managers in the hospitality industry, and also rather low when compared to mid-level managers in other industries. People often say that analytics seems daunting, and many assume that they don’t have adequate technical skills to enable them to use analytics effectively. The good news is that managers at all levels can and should be using analytics to support their day-to-day decisions and improve business performance, and doing so can help transform your business.

As you probably know, the implementation of analytics tools has been growing within the hospitality industry. By using these tools, new insights are gained from various existing sources of information and combined in ways that help you gain a deeper understanding of your data. These sources include: property management systems, point-of-sale systems, reservations systems, inventory systems, among others. Managers and executives who use analytics often comment about how they experience "a-ha" moments of new and improved insights that improve business performance. These insights can obviously go a long way to help improve performance, and when managers at all levels of the organization are contributing, the results are synergistic. The key, of course, is for everyone to feel comfortable using these tools. 

Thankfully, analytics tools have improved a great deal over the last few years, and are becoming more user friendly and easier for non-techies to use, empowering more and more managers to tap into the power of analytics to support decision making. The self-service feature of most analytics tools allows you to do a lot of simple yet powerful analytics with less reliance on IT. You can easily create your own reports and dashboards which include data from various sources, drill and filter data, choose visualizations that work best for your needs, and even share your analysis and insights with your colleagues. In most cases, the performance of these tasks will be guided by your organization’s overall analytics strategy, but there is increasing flexibility to obtain the data you need specifically for your role.

Transform Static Daily Reports into Role-based Analytics
Many mid-level managers and department heads say that they rarely find the daily flash reports useful. They state reasons such as, the reports don’t give them the information they need to do their jobs, they’re not interactive enough, and contain too much irrelevant information, making it tedious to find the information they need. Most managers say that they need something simple and concise because their roles don’t afford the time to sift through data to find what they need.

One simple way to better use analytics is to transform those daily flash reports into role-based analytics dashboards and reports. Most analytics tools enable you to do this, and there is usually very little re-work needed. In a nutshell, an assigned analytics role determines the analytics and data that a manager would see. For example, it can be set up so that managers only see the labor/cost/ratio analytics specific to their property or department plus other metrics specific to their role. The food and beverage manager will be most interested in a daily interactive analytics dashboard showing metrics such as revenue per cover, top “n” items,  labor/cost/ratio and beverage-to-food sales ratio, rather than the daily overall flash report. 

Role-based analytics do not diminish the value of the daily flash report. The point is that the daily flash report may not provide the relevant and value-added information you need for your day-to-day role.  A link can be provided on the dashboard to enable you access to reports that are more specific to your role, or more general reports as needed.  With the role-based dashboards and reports, you’ll be able to review the various analytics that are more relevant to your job.

 You can also further analyze your data and look beyond your metrics by drilling down to as many levels as you wish to see further details, viewing the same metrics from different angles or conducting side-by-side analysis with other metrics. The way you consume and understand information may be different from others, so when creating your role-based analytics, select the data visualizations that work best for you and the others who will share and use your analytics. For example, sometimes a color-coded graph is much better understood and appreciated than a table with numbers.

A Better Understanding of Your Guests
Proper analytics can provide a deeper understanding of the patterns and preferences of your guests to help your hospitality business develop better competitive strategies and guest experiences. For example, your various hospitality systems may provide reports that show standard demographic profiles, but these profiles may not be suitable for your situation. The guest demographic profile for a hotel located near a college campus in Delaware will be significantly different from that for a hotel located near a resort in Wisconsin, so using packaged demographic profiles may not be suitable for you.  You know your guests, you know how you want to look at them, and you know what answers you are trying to find. Use analytics to create and analyze your own demographic profiles and apply these profiles to the metrics that you want to measure. This can be done easily using the drag-and-drop feature of an analytics tool.

Take your guest analytics a step further by creating performance indicators or reports that combine data from various systems to enable you to understand the impact that the guest experience has on the various aspects of your hospitality business. Instead of running multiple reports from different systems and tediously trying to relate the reports to each other, simply create a single analytics report that combines data from multiple systems. Let’s assume that you are a country club manager who wants to better understand club members who play golf. Using a single analytics dashboard linked to a set of reports, you can easily analyze and understand annual play patterns, rounds played by age group, member type and tenure, weekend vs. weekday play patterns, unique play partners, and associated F&B and pro shop spending – all within a very short timeframe and without having to look at numerous spreadsheets and static reports. 

Most of the data you have about your guests also has a location component (i.e., city, state, ZIP code, etc.). It may be interesting to see how the location of your guests affects your business. You can create various analytics that combine this location data with your metrics (such as revenue) and project these analytics on a map. Something this simple will provide you with a very different insight into your data and your guests to help you answer questions such as from where your guests are coming, revenue per geographic area, reasons why you are or are not doing well in certain locations, or location of your competitors in relation to your target markets, among other things. Another simple way that you can use analytics to better understand your guest is by incorporating data from social media sources into your analytics.

In the next issue, we will discuss other examples of simple ways that mid-level managers can use analytics such as: benchmarking and monitoring performance, exception reporting and mobile access to analytics. Until then, be empowered and get involved in your organization’s analytics tools, and customize them to work for you.

Samuel Ayisi is the head of analytics with Nyansapor Analytics and can be reached at samuel.ayisi@nyansapor.com.

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