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Walk, Don’t Run! Six Easy Steps to Implementing CRM for Hotels

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March 01, 2004
Hotel | CRM
Mark G. Haley - MHaley@ThePrismPartnership.com

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© 2004 Hospitality Upgrade. No reproduction without written permission.

Many hoteliers fall into one of two perspectives on customer relationship management (CRM). The first group is not sure what CRM is, how to do it or how much it will cost. All in all, these hoteliers are reluctant to embrace this powerful set of business tools. The second group is ready to sign with checkbook in hand. These hoteliers are ready to jump headfirst into a potentially costly initiative without laying a strategic and operational foundation.
Addressing the needs of both camps of operators the simple and straightforward steps below identify what to consider when beginning a CRM initiative. By taking these easy and logical steps first, you will begin your CRM initiative knowing where you want to go and how you will get there, no matter what your starting point is.

A prime expample of a well implemented CRM intitiative is Affinia Hospitality. Affinia Hospitality has one of the richer and more mature CRM implementations in the industry, especially among smaller companies. John Cahill, Affinia’s CIO said, “The business process changes are the most difficult part of an initiative, but that is where the value derives.” Affinia’s investment in change management efforts that drive adoption were crucial to executing the business process changes.

At this point, perhaps you are ready to invest in a richer CRM effort, probably one involving a technology investment. The value of these foundational steps will become very evident in increasing the total return of that larger investment.

Mark G. Haley is a partner at The Prism Partnership, LLC. Prism is a consulting practice servicing the global hospitality and travel industries based in Boston. He can be reached at (978) 521-3600 or MHaley@ThePrismPartnership.com.

STEP 1 – Remember that CRM is a way of doing business, not a thing, system or technology.
CRM is a set of tools the organization can adopt in order to provide structure and meaning when interacting with guests and to create more value in the relationship for both the guest and the hotel. Treat it more like a carpenter’s tool kit than a monolithic technology. Select the right tool for your job.

STEP 2 – Define your objectives for CRM before you start.
Tie the definitions to your business strategies, not to your technology planning. Strong examples of business-driven CRM objectives include:

  • Attract new customers through a drive trial of a renovated property; they may otherwise be unaware of the recent investment
  • Increase repeat patronage of existing guests for a seasonal resort or city center hotel
  • Enhance service delivery for an established property
  • Move more marketing communications online to increase frequency and relevance of guest communications at lower cost

STEP 3 – Evaluate your property management system (PMS).
Look at the system’s guest history functionality and the quality of the existing data.

  • Is the existing guest history data worth keeping, or is the information so incomplete or full of duplicate records that to clean it is impractical?
  • What are the matching techniques and algorithms used to minimize the creation of duplicate records?
  • Can the PMS store observed and reported guest preferences for a small number of preferences relevant to your hotel or hotel company? (You can’t track every single guest preference, so limit what you track to the important ones.)
  • What are the facilities for communicating those preferences for the next visit or the next property in the enterprise?

STEP 4 – Emphasize data quality.
Establish simple and unequivocal standards that define data quality and assign responsibility for capturing all necessary data about a guest to everyone that handles a record. This applies to reservation, registration and check out. Some of the elements that require input standards include names (honorifics, hyphens and suffixes); addresses and abbreviations; market segments and distribution channel fields; and specific uses of comment and message fields for the protection of guests and staff.

STEP 5 – Document and train to data quality standards.
Develop a simple and replicable training process for your data quality standards and execute that process consistently. You can include written instructions oriented to reservations and front desk personnel or “cheat sheets” summarizing the standards posted at each workstation. Testing for quality data input with incentives attached and positive reinforcement of good data input behavior are also ways to encourage staff to strive for data quality. Lastly, ensure that all new hires go through the same training, testing and reinforcement cycle.

STEP 6 – Execute a structured change management plan.
Ensuring a successful adoption of the CRM initiative means the entire organization has to buy-in to it. Your job includes convincing line employees and management that embracing your CRM program as a way of life is in their best interest.

Do not assume that because you are committed to it that they are. Rather, plan the process for driving awareness, desire, knowledge of and acquisition of the changed behavior. Then reinforce it.

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