The pandemic has impacted industries across the board, but few have been hit harder than hospitality. Hotels have had to find ways to cut costs as travelers postpone or cancel trips, and restaurants have pivoted from dine-in to off-premises. With efforts to contain the virus still ongoing, uncertainty is an ever-present obstacle in business decisions.
Many hospitality companies are focused on solving immediate challenges. It may be hard to imagine investing in new technologies at a time like this.
But consider this – a Harvard Business Review study of the 2008 recession found that: Companies that combined cost-cutting with selective investing before the crisis ended had a 76% chance of pulling ahead of competition, as opposed to companies that solely cut costs.
Opportunity exists even in times of crisis, so let’s explore how revamping your organization’s accounting system can lead to competitive advantages during recovery and beyond.
Five essential ways to drive faster crisis recovery
The modern financial management platform delivers the insights you need, when you need them. Here are five essential capabilities hospitality finance leaders need to drive their organizations through a faster recovery.
1. Automate to free up time for high impact, value driving initiatives
Automate manual processes to increase operational efficiencies and spend more time on strategic initiatives. A good place to start is to evaluate any manual processes done in spreadsheets, such as budgeting and planning, multi-entity consolidations, and reporting.
Think about those tasks that often take hours, even days each month, like bank reconciliations, recurring invoices and payments your business creates each month for the same vendors. A modern accounting system connects to your banks, so bank reconciliations are a breeze. You can also set up recurring templates and schedules for those invoices and bills.
Without automated processes, hospitality businesses also find financial consolidation activities eating up days every month. Automating inter-entity eliminations can speed financial closes by up to 70%. And that’s time that can be more impactfully spent on strategic activities such as driving new revenue and customer satisfaction initiatives.
2. Make fluid strategic decisions based on real-time data
In an environment with constant, and at times unpredictable, change, making strategic decisions based on the latest financials versus last month’s numbers can mean the difference between getting ahead of what’s coming or getting caught flat footed.
An integrated cloud financial system pulls in data from different entities and sources, such as the point-of-sale (POS), property management (PMS), and revenue management systems. This eliminates the time-wasting hand-offs, manual data entry, external spreadsheets, and associated errors that stand between you and today’s financial insights.
Take for example the data sitting in your hotel PMS. More than just a system to track reservations and check-ins and outs, you can connect it to your financial system to harvest up-to-date information on guest booking patterns and promotion performance.
You can then quickly determine the revenue effects of say, a higher room rate with lower volume, and make optimal adjustments within the same period – with real time data. For instance, if you knew bookings were down today, you could potentially offer a promotion on the spot and quickly view the results in your financial dashboard.
Accurate, up-to-date information is crucial for timely data-driven decisions and is only available with modern integrated systems.
3. Enhance visibility of your entire business’s financials
In addition to being real time, your information needs to be highly visible and easily digestible so you can quickly spot trends. Dashboards provide real-time visibility into data – along with instant drill down. Sage Intacct role-based dashboards provide at-a-glance views of what matters most to hotels, restaurants, and franchisees. Financial leaders benefit from instant visibility into revenue, occupancy, operational efficiency, and other essential operational and financial KPIs.
This dashboard enables the CFO of a hotel to view the current RevPAR compared to that of last month to easily see recovery progress. Icons on the dashboard provide visual indicators of trends or areas of concern. Directly from the dashboard, the CFO can dig into drivers such as room rate or
volume with just a few clicks.
4. Equip your business for remote work in the cloud
The pandemic and imposed social distancing in many places catalyzed a shift to remote work. Very suddenly, many workforces found they need to work from home. Even hospitality, an industry that heavily involves personal interaction, is embracing cloud business systems as key enablers of remote work flexibility and continuity.
Cloud-based systems enable hospitality employees to remain productive and connected with the business. A leading cloud accounting system not only allows the organization to access the up-to-date information they need from anywhere and without issues with document version control; it has built-in chat and documentation tools so team members can communicate easily with each other.
What are the benefits of cloud?
Reducing the cost of upgrades and eliminating server costs generate major savings for cloud organizations. And, when cloud updates are deployed everyone gets on the same, most current software version without any time or effort spent.
Your workforce also benefits from the productivity boosting ability to communicate and share information via the cloud. Employees can collaborate and synchronize their work and files when they are in the cloud, and access them anytime, anywhere.
5. Future-proof with Artificial Intelligence (AI)
What is AI?
Simply put, AI refers to systems that perform tasks which normally require human intelligence. Such tasks include acquiring data and swiftly turning that data into actionable information.
Think of a self-driving car outfitted with AI and camera sensors around the vehicle. The car’s systems gather and analyze over 100 camera frames per second to make split second decisions controlling the steering and braking, so the car and passengers can safely arrive at the destination.
AI can help you continuously look across your business and actively identify opportunities, risks, or events hidden around the corner. AI performs what a human might have done manually, but faster and more accurately.
With insights actively pushed to you, you will be able to understand what’s happening across your organization and the environment so you can make the optimal decisions on room rates, menu items, prices, and staffing allocations. Typically businesses review their key performance indicators at the end of the week or month. But with real-time data and AI at your disposal, you could know immediately if you were trending towards not meeting your goals. Rather than seeing this at the end of the week or month, you’d be able to implement new strategies and promotions to correct a problem mid-week to avoid lost revenue and get back on track.
Then, freed from manual work and armed with active insights, you and your team can devote more time towards guiding the organization through the road to recovery and beyond.
Sage Intacct helps hospitality businesses in times of uncertainty
Remaining competitive in an ever-changing market requires modern digital tools. Whether you need access to real-time KPIs to analyze financial and operational performance or just need the ability to work remotely – our cloud accounting software is built for data-driven hospitality businesses.
Sage Intacct is the innovation and customer satisfaction leader in cloud financial management. AICPA-endorsed and best-inclass, Sage Intacct is a scalable and extensible system that provides multi-dimensional analysis and industry-specific capabilities to automate complex processes and improve company performance, so data-driven finance leaders can focus on strategic initiatives.
As hospitality companies continue to find their footing in a turbulent world, it’s important to understand business changes and their impact as they occur. A cloud accounting system has the power to direct real-time operational adjustments so businesses can understand, evaluate, and course correct just as quickly as market conditions and consumer preferences evolve.
You can then spend more time as a strategic leader with continuous insights delivered by your systems. And with these insights, always look across the business actively identifying opportunities and risks. Contact Microsys today and schedule a demo.