In the hotel industry, traditional accounting management practices have been a standard for a long time. However, there are various examples of other industries like the hotel industry using strategic management accounting or SMA successfully.
Through those visible benefits, the hotel industry is slowly getting on board with SMA as organizations are looking to improve their performance and strategies. Strategic management accounting allows a company to determine and implement business strategies while considering both internal and external factors in a certain industry.
Simply put, in this a highly competitive hospitality industry, and hotel managers need to look beyond their organizations when looking for ways to increase profitability and remain competitive. Here is how SMA can help them achieve this.
1. SMA brings front-office & back-office together
Strategic management accounting hotel software is a comprehensive solution which allows for better accounting. However, this is not the only thing you can expect. Hotels can do all of the accounting tasks while at the same time following up on the strategic goals of the whole company.
To strategize properly and reflect on their performance, hotels need to have a clear picture of all their finances. This is why these hotel accounting software solutions give managers a uniform platform where they can look at their front-office and back-office as a whole and separately.
This is important because, in the hotel industry, it can often be difficult to decern whether a certain task is a back-office or a front-office task. Additionally, when looking at them together, it is possible to pinpoint irregularities, see how overall finances are organized and adjust operations to align perfectly with your goals.
2. Improved cost management
First of all, strategic management account hotel software can help managers understand which of their costs reinforce the position of the company and identify those that weaken it. Simply put, it can be used to quantify which costs help achieve strategic goals, which have no effect, and which hinder them. With SMA software, managers can do a cost analysis on different levels based on:
- The entire hotel chain
- A single hotel level
- A single hotel department
This is how it’s possible to analyze costs more thoroughly and see how they correlate. Additionally, it can often be difficult to pinpoint costs that align with your goals and hotels end up investing money in something that doesn’t have a good ROI.
For example, a hotel might be spending a lot of resources on finding new guests. However, if it’s difficult to establish and maintain good relationships with them and most of them never return, it means that the customer experience is lacking. It’s not enough to just get more people through the door, you have to improve their stay as well. Happy guests will always consider returning to the same hotel again.
3. Gathering real-time information
One of the essential issues in hotel accounting is real-time accounting information. Having daily or weekly accounting insights is crucial when recognizing new issues, developing potential solutions, and achieving better resource allocation.
One of the biggest mistakes is thinking that some income channels are performing better than they actually are. Similarly, hotel managers make a mistake thinking that some costs are smaller than they actually are.
With this kind of hotel accounting software, managers can easily and quickly see how different channels are working. They can even monitor different hotels in the whole chain and easily have insights into everything that is going on while being able to compare performances.
4. Consolidation & management reporting
SMA hotel software provides centralized workflow monitoring. They reduce the time required to consolidate and help make better business decisions. They also allow acquiring all important data throughout various channels and consolidate it separately but also on the whole.
Having this kind of information makes it easier to draw valuable conclusions and make tangible business moves that will bring the whole organization closer to its goals. SMA software provides comprehensive portfolio management with a lot of flexibility and managers can take budget data and forecasts from all of their hotels and bundle them into a consolidated and clear piece of information.
This kind of consideration can also help reduce costs on various purchases that are not urgent and help prioritize towards increasing profitability.
SMA hotel accounting software is the future and there are already available solutions that can be utilized by managers to manage their accounts. Each year, there are more and more hotel chains relying on these solutions to improve their business performance and you should be looking to take advantage of them as soon as possible.