An analysis of the impact of implementing Revenue Management Systems on hotel operational performance

Abstract

The aim of this paper was to analyse the degree to which hotels whose managers employ a Revenue Management System (RMS) as a strategy to increase demand outperform other non-RMS-user establishments. This analysis was based on the assumption that increased demand due to us-ing an RMS will either increase a hotel's room occupancy (RO) or increase its achieved room rate (ARR), and eventually increase its revenue per available room (RevPAR), efficiency rate (ER) and average labour produc-tivity. The study used a sample of 106 chain hotels with a rating of three or more stars located in Andalusia (Spain). The econometric estimations show that the effectiveness of an RMS as a tool for improving perform-ance was generally achieved in these hotels through better management of occupancy, especially in the low season.