The Building Blocks for High Performance Business in Lodging Industry

Accenture Hospitality Services (AHS) is a new Accenture business service that provides a broad range of finance and accounting services to the hospitality industry.

Accenture’s High Performance Business Analysis research findings reveal that in the last ten years, the lodging market has witnessed significant change with the increased importance of emerging markets, shortened business cycles, slower growth rates and market disruption from the impact of online distribution. In response to these developments, high performing lodging companies have had to focus on a core set of high performance building blocks involving market strengths, technology and operational excellence. Over the next decade, however, the impact of a combination of macro, consumerand technology drivers will result in a new set of functional imperatives and high performance building blocks including:

  • Agile business models

  • Guest-focused value streams

  • Digital maturity

  • Agile operational excellence

  • Robust risk management and mitigation


TOP FINDINGS

  • Over the past four decades, the industry's inability to drive top line growth through pricing has resulted in sharper and more volatile business cycles.

  • OTAs percent revenue of US room revenue has grown from 6% to 8.4% since 2011.

  • The industry is expected to grow at a 5% CAGR 2013F-2017F, owing to increased demand from emerging markets and increasing travel spend by consumers, both for business and leisure.

  • Although ranked second to last in digitization in 2012, the hotels and restaurants industry had the third-highest digitization growth rate (+3.0 index points), an increase of more than 9%.

  • As a result of the emergence of the macro, consumer and technology drivers, lodging companies will be required to confront a set of new functional imperatives: robust risk management strategy, efficient resources management, operational excellence, value based offering, guest empowerment and mobility, analytics and digitalization convergence.

  • A significant overhaul of the distribution process is expected driven by transformational technologies; for example, the convergence of channels in the back office functions resulting in a more streamlined and efficient distribution system is expected.

  • Mobility and analytics have the potential to transform lodging operations over the next decade by addressing challenges during all phases of guest experience: research and booking, pre-arrival, arrival, check-in and stay, departure and reflection as well by remedying guest disengagement and operational concerns.

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