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Profit center Live forecast: Automatically switch between OTB and revenue driver

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For Non-room revenue departments that have a daily OTB import in PMI, there is an option to use a combination of both OTB and driver-based forecasts to create the Live forecast. This is the recommended set up for departments such as Meeting & Events (M&E). 

When enabled, the Live forecast will use either the driver-based or the OTB value for each day depending on the parameters set in configuration. 

This capability is available regardless of whether you are using a manual revenue driver or Machine learning.   

What is its purpose? 

This can provide a more accurate forecast for non-room revenue departments like Meeting and Events. 

Using only a driver will give a good general forecast, but on specific days for the shorter lead times may be misleading. A driver cannot pinpoint what day a larger reservation will occur or identify days when no reservations have been made even though there is usually activity on that type of day. This is better handled by using the OTB as a starting point. 

On the other hand, if only OTB were used in forecast, the longer lead times would have to be manually adjusted as there is usually not anything yet booked. These periods are better handled by using a revenue driver. 

This feature allows PMI to automatically switch between these two possibilities. 

How to set it up? 

Users with Admin rights can review and adjust the M&E Live forecast configuration settings via the tools icon. The following settings need to be activated to enable the functionality: 

  1. OTB: Enable to use On the Books data in the Live forecast.  
  2. Driver based: Forecast will be automated based on selected driver. The Live forecast can be manually overwritten either by using the pick-up column, or by selecting the icon by the date in the Live forecast table.  
  3. Use PMI machine learning algorithms: Uses the automated detection of drivers done using machine learning algorithms. This is not required, but is recommended. ML drivers works when 5 week of history is available, but the more history available, the greater the forecast accuracy. If disabled, a manual driver must be created.  
  4. Use only OTB for the next X days: For the X number of days, the driver value will be disregarded and the OTB value used as the base for Live forecast.
    1. How many days in advance will what you have OTB be what you get, i.e., you do not expect to sell anything more? 
    2. Example, with less than 3 weeks (default) remaining, you don’t expect to get more bookings. For the coming 21 days the driver is ignored and what you have OTB is what will be used as your Live forecast. You can still add/deduct a value by using the pickup field. 
  5. Use only OTB when above X% of driver value: If the OTB value is X % of the driver value, the driver will be disregarded and the OTB is used instead (range 0-99%).
    1. At what level do you considered the OTB to be a better value to use instead of the driver? You determine a percentual level of the driver, and when the OTB value is above this % the OTB   will be used as your Live forecast. You can still add/deduct a value by using the pickup field.  
    2. If 99 % is set, then the OTB value will be used only when it is higher than the driver value. The higher percentage you set, there is a risk that your live forecast might be overstated, as you always use the highest value from the OTB or driver.
    3. Example, default is 80 %. The driver suggests 10,000 for a specific day and is used until OTB exceeds 8,000 after which the OTB value is used instead. This will also depend on the first setting, which overrides the driver regardless of OTB level. 

For departments using segments: If OTB is not available for certain segments (e.g. beverage is not booked in advanced, but food is), then setting ‘Use only OTB for the next X days’ should be disabled and you should allow a driver to forecast the segments that have less than X% of the driver value.

Note: Settings 1) and 2) must be enabled for settings 4 and 5 to become available. 

Details on the other settings can be found here.

How to work with the forecast? 

In the Live forecast module, both the Driver Based and OTB values are shown for each day. The values that are used as the Live forecast are shown in black, and the disregarded values are greyed out. 

If segments are used, the total level will be black until ALL segments are using only drivers or OTB. For departments with segments, both values can therefore be black on total level (but never on segment level). 

You can manually add or deduct from the Live forecast using the pick-up column.  

Alternatively, select the icon to disable the driver based forecast for that day.

For historical days, you can review both the value that the driver suggested and edited values by hovering over the Live forecast column. 

It is PMI best practise to review the Live forecast daily for the coming 4-6 weeks depending on the staffing window and adjust as needed. Once a month, review the coming 3 months forecast to verify they are accurate.