Inn or out: Yield management in hotels – Simulation game

• Main Authors: ANG, Marcus, BHATTACHARYA, Lipika, KOH, Bernie
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2022
• Subjects: Yield management; revenue management; hotel booking; sales management; consumer behaviour; strategy and execution; Business Administration, Management, and Operations
• Online Access: https://ink.library.smu.edu.sg/cases_coll_all/405; https://smu.sharepoint.com/sites/admin/CMP/cases/SMU-21-BATCH%20%5BPDF-Pic%5D/SMU-21-0047%20%5BYield%20Management%5D/SMU-21-0047%20%5BYield%20Management%5D.pdf?CT=1646131496590&OR=ItemsView
• Institution: Singapore Management University

This is a game simulation case on yield management for the hotel industry. Students play the role of the reservation manager and are allowed to make hotel bookings for consumers who want to book hotel rooms at the InnorOut hotel. Students are encouraged to accept the bookings based on the principles of yield management. At the end of the game, students can see the amount of revenue that they have generated for the hotel based on the bookings that they have accepted and rejected. The game allows students to apply different strategies for high season and low season bookings. Penalties are applied to the revenue scores based on whether the rooms were overbooked or under booked. The case accompanying the game allows students to understand the concepts of yield management that they need to apply to play the game well and achieve higher scores. A separate set of settings in the game allows the instructor to adjust the various parameters of the game, and present consumers with different profiles, so as to assess the student’s understanding of yield management strategies. The Teaching Note serves as a guide for the instructor to execute the game in the classroom for students, and to cover the basic concepts in yield management through the game. The game case allows students to learn the following: (1) basics of yield management strategies (2) significance of various factors that impact consumer demand for a fixed product (in this case hotel rooms) (3) the advantages of yield management strategies for revenue generation. The case can be used both in undergraduate as well as post graduate classrooms.