Revenue Management Prof. Sandeep Munjal Prof. Anjana Singh
Revenue Management Programme
May 24, 2015
The Post Graduate Programme in Revenue Management (PGPRM) is a one year programme including 6 months of class room learning and 6 months of on-the- job training facilitated by InterContinental Hotels Group (IHG). With Vedatya being the leader in research as well as academic discourse in the area of revenue and profit management, the programme promises to offer skills and knowledge required for a successful career in revenue management in the hospitality sector.
This advanced level specialized programme focuses at the strategic level implementation, offering valuable insights into the science of pricing and revenue management. The programme pedagogy involves contemporary curriculum, sound conceptual clarity, a spirit of enquiry through guest lectures and experiential learning through practical application. The 6 month long on-the-job training along with hands-on training through software simulation, is guaranteed to build industry ready professionals.
This advanced level specialized programme focuses at the strategic level implementation, offering valuable insights into the science of pricing and revenue management. The programme pedagogy involves contemporary curriculum, sound conceptual clarity, a spirit of enquiry through guest lectures and experiential learning through practical application. The 6 month long on-the-job training along with hands-on training through software simulation, is guaranteed to build industry ready professionals.
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Revenue Management
Prof. Sandeep MunjalProf. Anjana Singh
PRESENTATION OUTCOME
An introduction to the practice and theory of Revenue Management
Understand service industry conditions that can make Revenue Management useful
Develop an understanding of Revenue Manager’s role
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HOW REVENUE MANAGEMENT STARTED
In late 1970’s US federal government deregulated airline industry in US, meaning government could no longer decide who could fly what route and at what price
The market became very competitive. New ways of pricing were needed that assured segmenting the market and therefore assuring optimal revenues
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Airline Deregulation and Yield Management
IMPACT OF REVENUE MANAGEMENT
American Airlines increased annual revenues by $500 million through revenue management
Delta Airlines increased annual revenue by $300 million through revenue management
Marriott hotels increased annual revenue with $100 million through revenue management
National Car Rental was saved from liquidation with revenue management
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WHAT IS REVENUE MANAGEMENT (RM)?
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“Selling the right product to the right customer at the right time for the right price.”
- Robert G. Cross
WHY REVENUE MANAGEMENT
Emerging markets creating more entrepreneurial opportunities & job prospects
Business are concentrating on maximizing revenue and cutting costs
The position of RM has changed from short term tactics to long term strategy
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WHY REVENUE MANAGEMENT
RM is no longer an independent function but is now integrated with Marketing, Operations & Finance along with continual support from IT industry
Exciting career prospects since the growth in Asian markets has resulted in short fall of skilled revenue management professionals
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RM VARIABLES
Time - Tell me when you want to come and I will tell you the price
Paying Power - Tell me what you are willing to pay, and I will tell you when you can come
Customer Profile - Tell me who you are, and I will tell you the price
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Revenue Management Application
Capacity is fixed Service cannot be stored Service is sold in advance Variable cost of making a sale is low Demand fluctuates The market can be segmented
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Applicable to the industries where:
REVENUE MANAGEMENT APPLICATION
Hospitality industry Hotel rooms that remain unsold
Restaurant covers that remain unutilized
Banquet/Spa facilities that remain vacant
Aviation industry Flight seats that are unsold
Cargo capacity that is excessive
Healthcare industry Hospital rooms that remain unoccupied
Test equipment that remain under utilized
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Examples of Industries:
ROLE OF FORECASTING IN RM
A successful RM strategy is predicated on effective control of customer demand.
It helps in deciding the most profitable mix of business segments.
The data i.e. used for hotel forecasting has two dimensions to it: when the reservation was booked and when it was consumed.
-(Weatherford,& Kimes 2003)
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THREE RULES OF FORECASTING
The forecasting must be at the right level of detail An appropriate amount of data must be analyzed Frequent forecasting must occur
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STRATEGIC REVENUE MANAGEMENT
As Revenue Management has demonstrated success and gained visibility, revenue mangers are taking a much more strategic role within the organization
They are responsible for managing revenue from every possible outlet, understanding the market forces that impact the organizations competitive position and coordinating with marketing on demand generating activities
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RM TECHNOLOGY
Market has changed- price transparency, social media and mobile technologies are game changers
Advances in forecasting and optimization technology, access to more data, increases in processing power, the move towards price optimization and new research into revenue management algorithm have outpaced traditional RM systems
Technological advancements are a key driver
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RM TYPOLOGY
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(Sheryl Kimes and Richard B. Chase)
ABOUT VEDATYA
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Formerly known as IIMT, Vedatya has a record of 14 years of excellence in education
Founding members Owners of Radisson Blu Plaza Delhi, Varanasi & Carlson, USA The Great Kabab Factory; over 20 outlets worldwide
Excellent Faculty Over 86% faculty has PhD or are pursuing a doctorate degree
Record of international internships & placement U.K., Australia, Malaysia, Dubai, Germany, Mauritius, Singapore
A self-sustained “Green Campus” with academic, recreational and residential accommodation for students
ABOUT VEDATYA (Contd.)
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Strongly research orientation Academic Journal called “Journal of Services Research International Conference on Services Management initiated by IIMT, global partners -
Pennsylvania State University & Virginia Tech University in US, Oxford Brookes University in UK, and Institute of Tourism Studies in Macao
First institute in India to have an internationally branded on-campus training hotel, “Holiday Inn”
Academic Partnership with IHG, world’s largest hotel company, in the form of an “IHG Academy”
Student support Cumulative scholarships worth Rs. 1.5 crores Active and diverse student life
IIMT students and Campus featured on BBC
in Partnership with InterContinentalHotels Group (IHG)1 Year | Specialization in Hospitality
Post Graduate Programme in Revenue Management (PGPRM)
PROGRAMME HIGHLIGHTS Specialization in Hospitality Awarded by Vedatya and InterContinental Hotels Group Includes 6 months of class room learning and 6 months
of on-the- job training facilitated by IHG Prepares working professionals to acquire skills and
knowledge required to deploy the same to make decisions that optimize revenues to maximize profits
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PROGRAMME HIGHLIGHTS
Fundamental principles of revenue management in a customer driven market
Advanced tools and techniques to handle strategic pricing
Aims to highlight the contemporary practices in Web 2.0 hospitality
Participants will receive advanced instruction in revenue management and learn the industry-critical skills and advanced techniques used by top performers in a way that not only drives profits, but improves overall organizational performance
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PROGRAMME HIGHLIGHTS
100% Placement assistance in revenue department of some of the biggest names in the hospitality industry
The 21st century in the service industry definitely belongs to the revenue manager
Today, revenue management is an essential part of every industry that offers a perishable product or service that cannot be inventoried
It is critical that businesses train their human resources to act as agents that make informed decisions to impact profitability, revenue management is an essential skill from that context
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PLACEMENT PARTNERS
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STUDENT/ALUMNI TESTIMONIALS
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STUDENT/ALUMNI TESTIMONIALS
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CONTACT INFORMATION
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Ekta WasonVedatya Institute (Formerly IIMT), Garhi Murli (Garhi Bazidpur), Sohna RoadGurgaon - 122102, Haryana | M: +91-9910159126www.vedatya.ac.in | E-mail: [email protected]
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