Detailing a Decade of Digital Adoption at Crescent Hotels & Resorts
MDO caught up with Rob Smith, CFO at Crescent, to discuss an overhaul of the company’s technology stack to centralize operations in the name of efficiency.
It’s a common thread throughout the hotel industry: Operators are looking to remove much of the back-office work from staff at the property level and take on more of that responsibility at the regional or headquarters level.
As line-level staffing remains a top challenge, centralizing this office work allows for property-level staff to rightly focus their attention on creating a superior guest experience. At the same time, it provides operators with a more comprehensive look at performance and the ability to introduce operating best practices that are aligned across their entire portfolio.
Think accounting and finance, which are time-consuming functions that previously required a team member at each property. By centralizing these functions, management companies can create efficiencies and reduce labor costs.
But centralizing back-office operations can’t be done without streamlined communications and connectivity between each of the properties and corporate. More than ever, operators are relying on technology as the framework for sharing information, oftentimes in the form of data, reports and dashboards.
Rob Smith has been serving as CFO of Fairfax, Virginia-based Crescent Hotels & Resorts for nearly eight years, and in that time, he has embraced the adoption of new tools across Crescent’s entire technology stack. Since 2015, Crescent has moved nearly everything that was previously done manually into a digital environment, including audit compliance, finance, procurement, payroll and business intelligence.
We caught up with Smith recently to discuss the challenges and opportunities Crescent has seen over the evolution of its digital transformation.
Q: What was the impetus behind Crescent’s digital adoption strategy?
Smith: People don't always like change, but it’s absolutely necessary. You can't do things with just pen and paper anymore. For example, I used to have to come in every Thursday and sign checks. We hardly cut any paper checks anymore, everything is digital.
Another example is the night audit packs. Back in the day, my team would put together a front-and-back page routing sheet with names and signature slots. It started off with the Director of Finance, who sent it to the GM, who sent it to the F&B Director, who sent it to the Chief Engineer, and it somehow made its way back to Accounting several days later. Today, there’s a list of reports that go into MDO and get authorized, and it’s all done very quickly.
Q: How often do you refer to previous night audit reports?
Smith: We just did it over the last few weeks. We have a union property and we needed to pull payroll records. We’re going through a New York State sales tax audit at one property. You still have to pull stuff out now and again, but with the payroll systems and the HRIS systems, much of that can be digitized. Nowadays, it's much easier to get the information quickly.
This morning I got in the office at 6:30 and by 7:30 I had already fired off a bunch of files. I can’t imagine having to print and fax those papers.
On a daily basis, we still need to look at things like occupancy reports, comp reports and service tracking items, but with today’s systems, its all readily available in digital format.
Q: What are some best practices you’ve adopted for initiating change?
Smith: People don't like change because it can be a painful process. But once they get used to the new systems, they’re more efficient.
When you’re making any type of change, the best practice is to communicate, and then communicate over, and then communicate over again. If you're communicating as to why you're doing it and how it's going to work, you’ll get buy-in. Then, look at what you have done right and what you have done wrong, and adjust.
Q: What are some functions that you can move from property to corporate?
Smith: Right now your General Managers are serving as a Jack of All Trades – they've got a lot of things they’re doing. So how do we help them out? How do we get things off of their plate? Much of our accounting functions that years ago were done on property – such as sales tax reporting, cash management, cutting checks – is now centralized. We are now talking about centralizing accounts receivable for certain properties. We even have one property that has taken advantage of an ATM-like system for cash handling purposes to eliminate daily cash deposits and allow corporate to reconcile banking activity.
There's still a cost associated with centralizing operations – you have to hire someone at corporate – but now the individuals at the property level should be freed up to perform more valuable and impactful functions.
Q: What property-level information does corporate want and need today?
Smith: It depends on the people you're talking to – Sales is going to want certain things, Operations is going to want something else, and Finance is going to want something else. We recently hosted our leaders from across the country in Fairfax, and one of things to come out of those meetings was developing a syllabus for onboarding new properties. How do we make monthly end-closing quicker? How do we get more accurate forecasting? Internal audits, payroll, procurement, risk management, business intelligence – we are developing training modules for new employees on all of those things.
Some of the dashboards that we're looking at are daily revenue reporting, risk matrix, ADR versus budget KPIs, labor productivity and forecast accuracy. With today’s market focus strictly on a property’s current and future cash position, its important to have all these items evaluated constantly to improve accuracy. With the ever-improving technological tools we are embracing, we know we will see the information sooner and more accurately to make better overall business decisions.
Jason Freed
Hospitality Data Evangelist
3302216068
Otelier (formerly myDigitalOffice)
