Is Commercial Awareness the most Important Hotel Management Skill for a Hotel Manager working in a big city today? I think possibly so… (read on or watch the video)
When an employer thinks you have Commercial Awareness, they trust you to make decisions that do not threaten the Hotel’s current and future ability to make money, by increasing costs too high, or changing a product for the worse.
If you have a commercial reality you put boundaries on your decision-making: you show commercial awareness when you check potential actions against your Hotel’s commercial reality.
Commercial awareness is the skill of always facing the reality of how a Hotel succeeds in the environment around it and then applying this skill to decisions made in and about the Hotel. But How do you develop Commercial Reality?
Read widely: what goes on in the world affects Hotels. Problems in the economies will affect all tourist levels, for example. Have a good knowledge of how the world is acting and try to apply it to the Hotel’s marketplace. Follow the website of a quality newspaper.
Read a trade publication: this will give you an insight into how the Hotel and Hospitality Industries are changing and how people, both inside the industry and outside the industry, talk about specific issues, which will help you feel – and act – like an insider.
Understand your Hotel’s financial issues: finance is a language. Using numbers, you can describe a huge amount about your Hotel, its relative health, its prospects for the future and will it be able to pay debts? Ask to spend time in your Accounts office and learn to ‘read’ your Hotel’s financial accounts.
Read company reports: You can search online for your Hotel company name and normally find their reports quickly. Start reading them, researching any terms you don’t know, and working towards drawing financial conclusions about the Hotel business that you work for. Annual financial reports will be available in most countries.
Talk to Hotel Industry Insiders: context is key in Commercial Awareness. By talking to Hotel Industry Insiders who have lots of experience in how Hotels develop, grow, struggle, you will be better able to spot commercial problems or opportunities that are relevant to your Hotel. This is a great area to look for a mentor.
You will develop Commercial Awareness by looking at the whole industry and not just your Hotel. Try working out why certain Hotels do well, how they are different to competitors, why they’re growing while others are shrinking, and generally what opportunities and threats are available?
Commercial Awareness is not just being aware what the Hotel’s key products and services are; it is knowing what makes the Hotel stand out from competitors, it is knowing who your main clients are and where their offices are located and understanding the exterior forces changing the Hotel’s market and customers.
Commercial Awareness is not Chasing Perfection, it is implementing Ideas in the Hotel that are appropriate and being able to explain how ideas benefit the Hotel. Commercial Awareness is understanding the Hotel Guest and why they spend money with you; it is effectively using or respecting Cash-flow, Profit and Loss and Budgeting.