At the core of any successful asset management strategy is the manager’s ability to make informed decisions.
These decisions are what sets one manager apart from the next and what generates superior returns for investors. Gaining insights in today’s data-driven world is not just about having more information, it is about having the right information when it is most relevant. Our industry and the data we use to run our businesses have changed dramatically over the last 20 years, but the systems we use to make these decisions have not.
At best, asset managers depend on incomplete or outdated data, and at worst, data that is incorrect or irrelevant. In addition, the fragmented nature of the hospitality industry means that just collecting this data is a time-consuming and inefficient exercise. This causes analysts to spend more time compiling, organizing and validating data than they do on analysis and other value-added activities.
Fortunately, there is a better way. Business intelligence systems aggregate data from many sources — including operators, brands, third-party tools and internal resources — to offer solutions that orchestrate, augment and present information on a single platform. Instead of downloading, copying, pasting and reformatting, an analyst can go to one place and have the information they need supplied with clear and meaningful context. BI systems also facilitate coordination between different areas of asset management so the operators, accounting teams, investors and other related parties may benefit as well.
This is not a new idea. Many managers say they want business intelligence, but it is hard to understand everything BI entails, and sifting through all the noise in the marketplace can be even harder. It is important to know that a BI solution is more than just a piece of software. There are a wide variety of technologies, processes and practices that go into delivering real business intelligence. Orchestrating these elements to collect, integrate, analyze and present information that supports better decision-making is the job of a true BI solution.
It also is important to understand that BI is not just about outputs. It is easy to get excited about colorful dashboards and libraries of reports, but they are only part of the puzzle. Details like these present information about what has already happened. BI solutions make it possible to go further by providing analytics capabilities that supply insights into why these things have happened and, even better, how to make the changes necessary to improve results. This iterative process cannot be achieved with canned commentaries and dashboards alone. Whether it is answering a specific question, researching a new opportunity or generating an ad hoc presentation, a true business intelligence solution will help you find all the information you need when you need it.
Another essential quality of a good BI system is that it fits into the workflow that makes each asset manager unique. A system that forces every user to look at data the same way is not much better than what managers are using today. Inevitably, standard outputs will lead analysts back to copying and pasting into models that let them apply their own unique perspectives. Business intelligence solutions need to be flexible enough to drive value across the whole spectrum of workflows and use cases that exist in the industry. Just like investors expect managers to set themselves apart and to produce differentiated returns, managers should expect their BI solutions to enhance this process rather than forcing them to use the same data with the same perspectives and on the same outputs as all the rest.
Of course, it is possible to build these capabilities in-house, but this is a challenging and expensive endeavor available to only the largest asset managers. One may be able to connect to APIs, create a data warehouse or develop a few dashboards, but that will only get one so far. Building a comprehensive business analytics platform that accommodates the significant complexities of our industry requires expertise. Fortunately, excellent third-party solutions that are quick to implement and easy-to-use are available today and mean that outsourcing is an efficient and cost-effective answer for managers of all sizes.
At the end of the day, the best asset managers are those who look ahead, and business intelligence solutions sharpen that foresight. When analysts have the time to dig into the data, they create more value. When executives are provided with key metrics in a concise and timely way, they make better decisions. When investors are given clear and meaningful presentations, they have more confidence in the business overall. As the hotel industry continues to evolve, the systems we use to drive improvements will only become more critical. Asset managers who prioritize systems such as business intelligence solutions will be better positioned to navigate the complexities of the market, capitalize on opportunities and achieve long-term success. The time to get started is now.
Drew Wallace is founder and CEO of Hotel Business Intelligence Solutions, a company that has developed a business intelligence platform for hotel investors.
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