In order to stay in line with the business strategy and achieve targets, any hotel business requires accurate financial planning, revenue monitoring and management reporting to ensure a healthy bottom line.
The hotel industry has its own specific business structure. It is comprised of numerous operational departments overseen by different management levels given their impact on the overall financial success. Thus, developing a strong level of financial leadership from the bottom up simply makes sense and is achievable by: 1) Ensuring every department has a budget and forecast plan in place and 2) This plan is executed, revised and updated consistently according to business demands. Fortunately, today’s digital age has brought about technology advancements to do the job. The only challenge is how to choose from a multitude of solutions in the market.
An effective financial planning and reporting tool does not only optimize processes to save time and effort, but also provide a comprehensive overview of the current business status and actionable information to empower hotel leaders in maximizing financial performance. In addition, reliable customer service and the promise from the solution-provider of continuous developments to address the constantly changing demand of the business should be considered during the selection process.
Here are some features to tick off when choosing one of the most essential technology for your hotel:
1. Ready-to-use structure
To have a financial planning and reporting framework already set and ready to use with hotel-specific chart of accounts (e.g. USALI), KPIs and calculation formulas and by market segmentation, among others is ideal. The possibility for further customization according to individual needs is definitely a plus.
2. Automated data integration
It is a fact that hotels do not work with just one system. In most cases, each system processes data that the other system needs. Having a financial planning tool that communicates directly with other third party systems (PMS, accounting system, document management system, revenue management system and rate shopping system, etc.) definitely guarantees freshness and accuracy of data for planning and reporting.
3. Collaboration function
Forget about having multiple versions of your budget and forecast plan and having to route to different departments that cause delays and break down in data accuracy. A tool that allows simultaneous planning of multiple accounts and departments or of the same account/cost center of multiple properties through multiple users with respective access rights ensures departments do not modify cost centers not related to them and more importantly, guarantee time-bound reports to be completed accordingly.
4. Automatic consolidation with integrated reporting
Management groups require having the possibility to see one big picture of their portfolio. A tool that provides a standardized summary and comparison of the performance and / or planning values of all business units or individual clusters would assist in their portfolio management.
5. Workflow management
A configurable workflow feature controls processes to be executed like clockwork to avoid delays in planning and reporting submissions. The administrator could control the progress of individual or multiple departments / properties’ planning processes. Same data availability and accuracy are also guaranteed given there is only one plan being worked on.
6. Multi-functional planning
You can take planning to a higher level if you can compare data through different variables (time – daily, monthly and yearly, by department or cost center) and various comparison scenarios: budget, forecast, what if. Leave no stone unturned with the endless possibilities for your planning and analysis.
7. Automated drivers
Forget about entering values one by one, there are drivers to simplify and automate financial planning. A driver connects two accounts via a ratio. Imagine how much time you could save and avoid making mistakes with the automatic calculation of total costs for your base accounts.
8. Detailed planning by sub-accounts
If detailed planning is required for even the smallest cost item, a feature that allows you to divide a fixed amount of your main account line into sub-accounts and distribute over a defined time period would be helpful. Drivers play an important role in this task.
9. Multiple segmentation options
Not all hotels have the same segmentation structures therefore a tool that allows planning by different segments to match specific needs would be beneficial. Apart from the actual data based on the raw segments from the hotel PMS, a customized mapping feature allows flexibility for respective users according to their needs – such as analyzing data according to individual property standards, customized groups, or head office format.
10. Flexible cluster reporting
Monitoring the room reservations and pickup data of multiple properties is a tedious task for hotel management professionals and requires certain guidelines to help them organize these data into meaningful information. A feature that allows the creation of multiple clusters based on different variables such as by location, star category, number of rooms, or by brand, would address this challenge and provide clearly defined reports for easier analysis.
