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The Effectiveness of Yield Management Systems

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It has been proved that yield management cannot perform well under specific conditions, as for example in the following cases: a) ‘ when a hotel serves a single market segment or b) when a hotel has less than 50 rooms, i.e. in a hotel that has low occupancy rates’ (Abdel-Kader 2011, p. 505). This means that yield management systems are primarily designed for supporting the operations of hotels that are already well established in the market. At the next level, Weber & Chon (2002) note that today yield management has been highly developed compared to the past.

The systems of yield management currently used in hotels worldwide can be so complex that they can be only managed by highly skilled staff (Weber & Chon 2002, p. 198). For example, there are hotels where yield management is developed by individuals working exclusively on this subject (Weber & Chon 2002, p. 198). This trend leads to the following assumption: in order to be able to respond to the needs of yield management, hotels operating in the modern market need to establish relevant training programs, ensuring that all employees involved in the particular activity are appropriately skilled. Bowie & Buttle (2012) also highlight the high dependency of yield management on IT systems.

The above researchers, not that yield management systems can fail in providing an accurate image of organizational performance when the data entered in these systems are not accurate (Bowie & Buttle 2012, p. 168). Even minor mistakes when typing data that will be used by a yield management system can eliminate the accuracy of the information provided by the above system (Bowie & Buttle 2012, p. 168). The over-dependency of yield management on IT systems has been considered as the most significant disadvantage of the particular framework. When having to evaluate the effectiveness of yield management systems, the following issue needs to be explored: are the managers involved in the relevant processes appropriately skilled in order to respond to the system’ s requirements?

Also, even if a yield management system has successfully operated for a particular period of time, its effectiveness in the long term cannot be secured.

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