So, how can revenue managers break free from this cycle of short-termism and start focusing on the bigger picture? The answer lies in effective prioritization. By distinguishing between urgent and important, revenue managers can ensure they address the immediate challenges and the underlying issues that drive long-term success.
This blog post introduces a powerful tool for achieving this balance: the Eisenhower Matrix. This simple yet effective framework can help revenue managers prioritize their tasks based on urgency and importance, allowing them to address today's problems while also planning for the future. So, let's dive in and explore how you can use the Eisenhower Matrix to transform your approach to revenue management.
A helpful tool to prioritize tasks
The Eisenhower Matrix can be an effective tool to help ensure you're not "straining at a gnat and swallowing a camel." The matrix, also known as the Eisenhower Box or Decision Matrix, is a time management strategy that helps prioritize tasks by urgency and importance.
The matrix is divided into four quadrants:
- Urgent and important (tasks you should do immediately).
- Important, but not urgent (tasks you should schedule to do later).
- Urgent, but not important (tasks you should delegate to someone else).
- Neither urgent nor important (tasks that you should eliminate).
By using this matrix, you can ensure that you're focusing on the "camels" (important tasks) rather than the "gnats" (unimportant tasks). It helps you to identify what truly needs your attention and what can be scheduled for later, delegated, or eliminated altogether. This way, you can avoid spending too much time on trivial matters at the expense of more significant issues.
However, it's important to remember that what is considered a "gnat" or a "camel" can be subjective and vary from person to person. What's important and urgent for one person might not be the same for another. Therefore, it's crucial to clearly understand your priorities and goals when using the Eisenhower Matrix.
Revenue Manager tasks
Here is a random list of revenue manager tasks added to the four quadrants in the Eisenhower Matrix. The tasks are related to revenue, customer satisfaction, and cost management for a hotel revenue manager.
Urgent and Important (Do Immediately)
From a revenue management perspective, everything seems urgent, such as forecasting, updating rates and availability, keeping track of guest satisfaction versus rate levels, and ensuring customer acquisition cost is not skyrocketing. With a pricing system or an RMS and a system that tracks Customer Acquisition Cost, the revenue manager will have fewer urgent and important tasks and have more time for important strategic tasks. Here are a few examples.
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- Responding to a sudden drop in occupancy rates due to unforeseen circumstances.
- Adjusting prices well before a peak season or event to maximize revenue.
- Addressing a significant issue with the hotel's booking system preventing reservations.
- Addressing a widespread complaint affecting bookings or customer satisfaction.
- Responding to a sudden influx of negative reviews that could impact future bookings.
- Addressing a sudden increase in Customer Acquisition Cost (CAC) due to changes in advertising costs or commission rates.
- Responding to a significant drop in profitability due to increased costs or decreased revenue.
Important, but Not Urgent (Schedule to Do Later)
This is the "long-term" quadrant where strategic revenue managers spend time. Here are a few examples of tasks.
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- Developing a long-term pricing strategy based on historical data and future projections.
- Analyzing market trends and competitor pricing to inform future strategies.
- Implementing and training staff on a new revenue management system.
- Regularly scheduled review and adjustment of room rates based on demand forecasts.
- Analyzing customer feedback and reviews to identify trends and areas for improvement.
- Developing or refining a customer loyalty program to encourage repeat bookings.
- Planning for customer experience improvements that could lead to higher room rates.
- Analyzing the effectiveness of marketing campaigns in terms of cost per acquisition.
- Developing strategies to reduce CAC, such as improving organic search rankings or building customer loyalty to encourage direct bookings.
- Regularly reviewing and negotiating contracts with vendors, suppliers, or online travel agencies to manage costs.
Urgent, but Not Important (Delegate)
Revenue managers must become better at delegating and, therefore, train people to perform simple revenue management tasks. Here are a few examples of tasks that other team members could perform.
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- Responding to routine queries from staff about revenue management policies.
- Compiling regular reports on revenue, occupancy, and other key performance indicators.
- Checking and responding to non-critical emails or communications related to revenue management.
- Responding to individual customer complaints or queries that could be handled by customer service.
- Compiling and analyzing customer satisfaction surveys.
- Compiling and analyzing reports on marketing costs and effectiveness.
- Managing routine communications with vendors or suppliers.
Neither Urgent nor Important (Eliminate):
Equally important as a priority list is an eliminate list. Add all tasks that should be eliminated to this list and decide to completely eliminate these tasks forever. Here are a few examples.
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- Getting involved in minor disputes that should be handled by customer service.
- Attending meetings that don't directly relate to revenue management or where the revenue manager's input isn't necessary.
- Tasks not aligned with the hotel's revenue goals could be considered distractions.
- Getting involved in minor customer complaints that should be handled by customer service.
- Spending time on tasks that don't directly improve customer satisfaction or revenue.
- Spending time on marketing activities with a high cost and low return on investment.
- Getting involved in minor cost-related disputes that another team member could handle.
This comprehensive matrix should help hotel revenue manager prioritize their tasks effectively, balancing the need to drive revenue, satisfy customers, and manage costs.
Conclusion
Everyone needs a good structure to get the right things done. Make sure you prioritize tasks with the highest impact on revenue and profitability.