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New Approaches to Room Allocation or Which Room Gets Assigned to Which Guest?

Updated: Sep 14, 2023

Reservations are still primarily managed manually in most hotels. However, is this approach still appropriate given the current staffing levels and new employee profiles? Is manual room allocation truly the best method to optimize your room plan? What criteria influences these decisions? Or should we consider assigning rooms upon arrival and disregarding guest preferences?

Determining which room is assigned to each reservation has largely remained a completely manual process in the hotel industry. While there are Property Management Systems (PMS) that now automatically allocate reservations within categories, this is based on basic rules and often requires manual adjustments by staff due to changes in occupancy and demand. This can lead to reassigning previously allocated reservations to different rooms. The effort and time that hotels invest in room allocation and the regular shuffling (sometimes referred to as a "Tetris game") can take up several hours per day, especially for larger properties with high occupancy.

Effective room allocation that takes various criteria into account is not only labor-intensive but also results in accommodating guest preferences and profiles, allowing guests to check into the room that suits them upon arrival. For manual room allocation, there are numerous tutorials available, and hotel chains provide additional guidelines to be considered by the front desk team during the assignment process.

Some hotel employees, due to their long-term tenure at the same property, are not only highly skilled at performing this task but also find it fulfilling when they allocate reservations after hours of work, managing to create gaps for additional requests or fulfilling guest preferences.

However, reality presents a slightly different picture. On one hand, there's a shortage of skilled labor, and employees are expected to handle a wider range of tasks. On the other hand, there's a decreasing number of staff members who stay at the same property long enough to know every room and allocate reservations effectively. Manual room allocation and the need to make changes to a confirmed booking add extra (work) costs. These costs are often not accounted for in the hotel industry and are recorded as general front desk activities, which significantly reduce profits and guest-facing time. Reservations are sometimes assigned based on individual employee preferences, and under high pressure, reservations are shifted simply to fill gaps in the room plan as efficiently as possible, regardless of the room's value or category. Free upgrades become necessary in such cases. Optimizing the room plan is an ongoing process, especially during peak occupancy periods.

Why is it so difficult to implement room assignments correctly?

In addition to the multitude of criteria that an employee would need to consider when making assignments, the employee also needs a deep inventory knowledge to carry out a suitable allocation.

Among the additional criteria are, for example: guaranteed versus non-guaranteed bookings, direct bookings versus bookings through third-party channels or specific providers, bookings for families, seniors, guests requiring accessible rooms, adjoining rooms, specific bed configurations, and other guest preferences, repeat guests, check-in and check-out times, etc.

The complexity that comes with effective room allocation is undeniable. Additionally, gaps in the room plan must be minimized, especially since these gaps cannot be automatically sold and could lead to revenue losses, particularly during periods with minimum stay requirements if gaps cannot be sold – for example, over the phone.

While long-serving employees might still find this task meaningful, a closer examination of this workflow raises the question of how feasible and contemporary it is to carry this out with reduced staffing. It's worth considering whether younger generations of employees would value this task in the same way or simply view it as an additional burden to complete without taking into account the aforementioned points.

How can a room plan be optimally utilized?

One approach could be to only assign reservations upon arrival and disregard any preferences or requests. However, this contradicts the goals of any hotelier who aims to meet the needs of their guests and provide them with an unforgettable stay. Moreover, such a strategy is more likely to result in overbooking of room categories, an increased number of complimentary upgrades, and negative guest feedback. Effective demand management also involves considering stay restrictions to minimize gaps in occupancy, and last-minute room assignment is suboptimal in this context.

The fundamental issue lies not only in the lack of skilled personnel, lack of knowledge about the property, or time for allocation but mainly in the fact that room inventory isn't detailed enough in systems to be used as criteria for assignment.

However, who says that room inventory must continue to be managed solely within categories, and how can artificial intelligence be better employed in this case?

Only with a detailed capture of room inventory including individual room features can the next step involve making assignments using algorithms and rules in a way that is intelligent, automated, and dynamic.

From this point onward, hotel staff can rely on professional support for room assignments. This not only brings significant time savings but also doesn't require extensive tenure or product knowledge of the inventory. Most importantly, it enables continuous optimization of the room plan as reservation statuses change. With a revamped inventory management, gaps can be automatically filled and the fulfilment of guest preferences based on specific room criteria can even be monetized.

Room assignments using artificial intelligence every room assignment involves certain considerations: Should the guest's preference be taken into account to satisfy them, or should short-term revenue be optimized? With a detailed inventory structure and the use of artificial intelligence, an optimal room assignment solution can be created dynamically, adapting to the desired strategy with each new booking situation.

It's comparable to the invention of the washing machine: While you still need to put the laundry in the drum, set the wash program, and press start, from that moment on, you save an immense amount of time, and the result is much better than continuing to wash the laundry by hand.

The tasks and requirements for hotel employees are constantly changing, much like in many other industries. However, the hospitality sector is a service industry where the primary focus is on providing guests with a service and ensuring a positive stay experience.

The cloud-based technologies available in the hospitality industry not only allow many tasks to be carried out from different locations (remotely), but also enable employees to have more time available for guests. This is achieved by digitizing and ideally automating downstream operational processes.

An optimized room plan is just one of many operational tasks that can be automated using intelligent technology in the future. Such automation could significantly reduce the current workload while simultaneously efficiently accommodating guest preferences and room plans to maximize revenue for the establishment.

For those interested in learning more about this topic, further details about GauVendi's Inventi-Flow solution can be found directly on their website, along with the option to schedule a non-binding demo session.

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