Teaching Yield Management in the Hospitality Management Curriculum

Abstract

I Yield management is one of the most revolutionary innovations to impact the lodging industry ever. Yield management allows the rooms division of a hotel to control the rates being quoted and occupancy by market segment to maximize rooms revenue. By combining artificial intelligence and the knowledge of experts in a hotel, yield management can produce results that were previously unthought of. Yield management/artificial intelligence was first experimented with by Computer ized Lodging Systems, Inc. and Sonesta lnternational Hotels Corp., in April 1988. Since that time every major software vendor has made plans to introduce a similar product. Currently, the major lodging corporations are experimenting with yield management at test properties and finding the results to be financially beneficial. With these positive results in mind it is easy to see that yield management is about to make a permanent mark on the lodging industry. II This paper will attempt to provide readers with the following information: • What yield management is • How artificial intelligence works • How yield management and artificial intelligence are combined • A review of the current vendors of YM/AI • Results experienced by YM/AI users • Where and how YM/AI should be included and taught in the Hospitality Curriculum Through this analysis of yield management/artificial intelligence, the readers will gain the knowledge necessary to function and educate in this new environment. III The financial impact that YM/AI is going to have on the lodging industry in years to come is immense. Currently there are only a handful of individuals in the lodging industry who are familiar with YM/AI. If hospitality education is to fulfill its mission of preparing the future managers of the industry, current innovations must be assimi lated in the hospitality curriculum as quickly as possible. YM/AI is an innovation that provides hospitality education the opportunity to fulfill its responsibility of educating students in the use of state of the art technology prior to its complete adoption by the industry it serves.