I use hotels as an analogy for some of my strategic thinking when I think about how the revenue sources from hotels have changed. At one point, I am sure they made substantial money from long distance hotel charges (now irrelevant because everyone uses their cell phone), then from HBO and premium movie charges (replaced by the thousand-channel cable network), then from room service and meals (now reversed with hotels offering free breakfasts) and even from early wi-fi connection charges (again, being phased out in many wireless facilities).
The expense side of the ledger has changed too. In addition to lost revenues, hotels have added expenditures in the form of manager cocktail receptions at many chains, rain showers and upgraded shower facilities, refrigerators in most rooms (now empty instead of the revenue-generating mini-bars), weight rooms and overall larger guest rooms with more decor and amenities.
Colleges are like hotels -- and many other businesses -- which are facing rising expectations for services coupled with decreased revenue sources. All this puts tremendous pressure on the budget and overall economics of the enterprise, especially in an industry where surface differentiation is difficult and competitive pricing is intense.
When I think about the future, the scenario can't continue to involve adding more and more while deriving revenue from fewer sources. We need to think about reducing services that the customer doesn't care about and focusing our efforts on outstanding service in the basic operation. We should focus more on segmentation and reaching out to a targeted client base, rather than competing with everyone, and doing all we can to serve those customers again and again.
Think about your organization and what parallels you see with hotels or colleges. How can you provide meaningful value instead of just "more" to compete with the next guy?
-- beth triplett
leadershipdots.blogspot.com
@leadershipdots
leadershipdots@gmail.com
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