PMI by d2o changes complex information into efficient management tools. It involves some data components and an algorithm to derive seasonality. Buckle-up because this may be a technical ride!
First things first, we need a driver to feed the algorithm. A driver can be used to represent historical data that reflects the behavior for a department and is based on correlations within that department.
For example, the Front Desk department may use Room Revenue as the driver. The Room Revenue driver data will provide insights on revenue patterns and variability of weekdays. With a minimum threshold for analyzing historical data at 365 days, PMI detects seasonal behavior for the year.
The algorithm starts off by reviewing every weekday within the dataset provided. Afterward, each weekday is stacked within the timeframe selected and compared to similar weekdays within the range. For instance, if we chose to review all Sundays in December, can we see a revenue pattern? Or do we see that based on a five-week range, only three Sundays out of the five Sundays reflect a similar pattern? If that’s the case, does this mean we have a seasonal pattern ? The answer is maybe, let’s go further.
If it is not a seasonal pattern, what else can it be?
There can be the presence of trends, or cyclical revenue patterns, across different timeframes. The cyclical patterns can be represented at a quarterly, monthly or even weekly interval. If the behavior is distinct and happens maybe once every other year, then it could be distinct time period patterns. For example, the General Manager of a Conference hotel in Florida may have a business client that rotates venues for their yearly conference, resulting in a booking once every two to three years at the Florida property. This represents distinct time periods that may not be predicted correctly from historical data. Feedback on these specific non-seasonal patterns empower PMI by d2o to provide the best forecast in the industry.
What’s the benefit of Seasonality in PMI?
It’s simple, it allows you to automate your weekly, monthly and quarterly forecast with little intervention. This means reliable forecasts that help management focus their energy on the most important aspect of hospitality, the guests.