RM at work 13.2 Case

Read RM at work 13.2 Case and Answer these questions.

Question 1

Assume you were the decision-making RM at the Courtyard Plaza. Would you agree to block the rooms for transient sales as Warren suggests, or would you follow Andrea’s advice?

The decision-making process in the business is imperative to influence the stakeholders. The most important thing is to retain the customer to enable business sustainability. As decision-making at counter yard plaza, I don’t agree to block the room for transient sales as the warrant suggests. Andrea’s advice is useful, as the company must have to facilitate its potential customer. It seems better to prioritize regular customers instead of facilitating seasonal basketball people at the double the rate. The company should not lose its customers, as they are the primary revenue resources on weekends throughout the year. Blocking rooms for transient can be a compelling strategy, but it seems good to expand the room portfolio to facilitate all kinds of customers.

Question 2

Assume you were the executive director of the Pecan Growers association. What do you think your reaction would be if you were told you needed to move your conference due to the NCAA tournament?

As an executive director of the Pecan Growers association, I will be frustrated to move the conference due to a basketball tournament. It will be tough for me to arrange another venue for the conference, as it can increase the conference’s cost. It is a bad feeling when a company prefers new and portable customers instead of retaining loyal customers. If I get the new deal with the new hotel, I can decide to avoid booking next time. The frustration will be shown by leaving the hotel permanently, as other options or substitutes are available (O’Fallon & Rutherford, 2010 ).

Question 3

Is this a revenue management challenge that is best addressed with a revenue displacement analysis? Explain your answer.

From the perspective of the hotel, it is a revenue management challenges. Maybe, the hotel management is experiencing a declining revenue stream due to a lack of new customers. Booking rooms for transient can address the challenge for a while, but it can lead to revenue displacement. Of course, if the hotel management books the rooms for basketball tournaments, it may lose the revenue streams from existing customers. Consequently, the revenue displacement is always in a loop. The hotel management, including decision-makers, must be aware that increasing revenue streams is essential. Still, the hotel needs to keep the balance (Talluri, Ryzin, & Ryzin, 2005 ).

References

O’Fallon, M. J., & Rutherford, D. G. (2010 ). Hotel Management and Operations. John Wiley & Sons.

Talluri, K. T., Ryzin, G. V., & Ryzin, G. J. (2005 ). The Theory and Practice of Revenue Management. Springer Science & Business Media.