Hotels struggle with data overload and analysis paralysis, as marketing, sales, and revenue only have one piece of the puzzle and often conflicting KPIs for individual bonus schemes. On top of that, there are too many siloed, incompatible, and inconsistent systems and tools. The progress to moving from silos to a commercial team has been slow. People do not like to change and leave their comfort zone. Nor do they want to report to a new middle management boss instead of directly to the GM or CEO. However, there are many good reasons why it is worth changing. Below are three reasons why marketing, sales, and revenue would benefit from working in a commercial team instead of in silos.
Fewer conflicts
GMs and CEOs must constantly break up fights between marketing and revenue and revenue and sales. I struggled with that as a CEO and a GM. Sales complained about the revenue manager stopping them from bringing in business. Revenue management thought marketing wasted money on unnecessary campaigns to fill the hotel. The worst part was how the continuous conflict between marketing, sales, and revenue affected the atmosphere negatively, leading to missed opportunities and finally hurting profits.
Working as one team creates a healthy discussion instead of conflicts. Being on the same team, focusing on the same goal, and being appreciated for the knowledge and skills you bring to the table create a dynamic and fun workplace.
Personal development
The pandemic forced hoteliers to lay off much of their commercial team, and all of a sudden, the people left had to manage marketing, sales, and revenue management. They had to learn quickly and make the best of the situation. After the pandemic, hotels have had difficulties finding people to rehire, which opens opportunities to learn more skills and acquire a broader skill set. People with more knowledge and experience from all types of commercial work will be in high demand in the job market and will be able to move up in their careers. Experience in many roles is a perfect background to step up to the commercial manager position.
From the commercial manager position, a step up to becoming the general manager is not far away.
Higher compensation
It is difficult to maximize the commissions or bonuses in a siloed organization where people in different silos have conflicting goals. In a commercial team, all members have aligned and often shared goals. Therefore it will be easier to reach the goals, even if they are a bit higher, and this would end up as a higher compensation for every team member.
People with more diverse skills that can work in all three roles will also be more valuable to the hotel and therefore get a higher base compensation.
Hotels will also be willing to pay commercial team members more since working as a team will be more productive and generate more revenue. The hotel will become more successful financially and can then afford to pay higher compensation.
A bright future for commercial roles
The three motives above are all good reasons to move from silos to a commercial team. However, there are a few obstacles that hotels need to overcome. One is to establish a new organizational chart and find and appoint the head of the commercial team. Another is to set revenue growth goals for the team and rework the commission and bonus plans for each team member. A third is to implement a commercial system where all roles have the functions they need to perform their jobs.
The rewards in terms of revenue growth and higher profits are substantial when hotels have an aligned and productive commercial team.