Business Intelligence, Enterprise Accounting;
Use 2/3 Less Accounting Staff
Profitability; Shorten Month-End Close to 4 Hours;
GMs Review 90% Accurate Trial Balances Daily
SEE APTECH AT HITEC BOOTH #1008
PITTSBURGH, June 17, 2004 – Midscale operators are rapidly adopting centralized financial management technology that delivers accurate real-time decision data, and lets managers repeatedly make small cost cutting measures that result in increased profitability. These technologies, like business intelligence and multi-property corporate accounting systems, were until recently employed only by large publicly traded hotel companies that could afford the steep communications fees and application costs associated with their use. Now, because of more robust Internet applications, stronger online security, and falling bandwidth costs, many midscale hotel operators are using centralized software to make far-reaching changes. The benefits of these multiple, minor changes include aggregating credit cards for a higher average ticket and lower fees; shortening month-end close to four hours per property; the ability to view real-time trial balances on P/Ls that are 90-percent accurate, and doing it all while using two-thirds less accounting staff. Here is a look at three fast-track companies at the front of this trend
Navigate with a Global Positioning System Instead of a Sextant
Highpointe Hotel Corporation, based in Gulf Breeze, Florida operates 12 hotels carrying five different Marriott and Hilton flags. Although the hotels use separate property management systems, Highpointe pulls all their financial and operating information daily into its central accounting and corporate business intelligence systems that update, real-time, their general ledger, accounts payable, and other records, and then analyze operating performance. It is a big job, but completely automated.
”Managing with a business intelligence application is like navigating with a global positioning system on your desk; you always know where you are financially,” said Dave Spangrud, Regional Director of Operations and Support for Highpointe. “Waiting until the end of the month to see your property P&Ls is like plotting a course with a sextant that only allows you to check your position once a month. We use a centralized enterprise system because Highpointe wants to run profitable hotels.” Spangrud continued, “If our in-room supplies are typically 60 cents per guest and they suddenly spike to 80 cents per guest at a property, we are aware of it instantly and can drill down to the causes and correct course.” Spangrud also noted business intelligence systems provide a clear picture of the effectiveness of last month’s cost cutting ideas by displaying just the slice of intelligence he wants, when he wants to use it.
Mark Pate, Highpointe’s MIS Director and Assistant Controller, explained that central financial analysis saves time as well. “It used to take our controllers hours to work through payables and receivables to generate a cash report. Now, because our G/L, deposits, and A/P are updated instantly we can get a current cash worksheet anytime we like.” In addition to the business analysis Highpointe runs at headquarters, its GMs can see their property’s performance by running a trial balance that is 90-percent accurate any time in the month. This lets them manage more profitably because they can compare actual performance against budget in real time and make operating adjustments.
“Operating budgets are the course our properties steer to,” explained Highpointe’s Dave Spangrud. “If GMs see a revenue shortfall on Monday they can make cuts immediately and talk to department heads the same day about reducing expenses to keep performance in line and remain profitable.” Highpointe uses the Execuvue business intelligence system from Aptech Computer Systems to analyze its hotels’ performance, and Aptech’s Profitvue multi-property corporate accounting application to gather property data and centralize its accounting.
Investors Value Daily Revenue Update Reporting
Raleigh, North Carolina-based Concord Hospitality Enterprises Company, operating 43 hotels under 10 major flags, centralizes accounting and business intelligence for its properties to generate timely investor information and operate more efficiently. Concord links properties to its corporate office via a secured Internet distributed VPN for data collection, and uses a Web-based back office accounting system from Aptech that allows managers to regularly pull up property financials and monitor performance. “We have three integrated financial systems that let us collect, manage and analyze our operating information centrally,” said Brian Cornell, Vice President of Information Technology for Concord. “For the non-financial managers at our smaller hotels we have an easy to use system called Webvue that takes data from their property systems and lets them review their financials. We also use the Profitvue enterprise back office system at our corporate office, and we pull all operating information into our Execuvue business intelligence system that analyzes property performance, spots trends and generates ad hoc reports for our managers and investors.” Cornell noted that with a centralized financial system one or two accounting professionals can handle up to six properties, making a much more efficient use of its staff. “Some of our investors really value receiving daily revenue updates over the Internet that track their assets’ performance. Another advantage of having centralized financial systems is that you can evaluate all hotels with the same set of reports for objective uniformity.”
Consolidating Credit Card Transactions Keeps Expenses Low
Similarly, all 33 properties operated by ZMC Hotels are supported remotely by a central enterprise back office system maintained at the company’s Duluth, Minnesota home offices. Since all of ZMC’s different property management systems interface with the corporate back office application, data is instantly uploaded after the night audit without having to assign staff to key in information. ZMC’s general managers have password-protected access to their property operating information the next day so they can check their numbers as if the audit was run on property. The company relies on technology to let them run more efficiently; it recently interfaced its ADP payroll system to their central back office software for instant updating to general ledger accounts of all labor expenses. “We centralize nearly all the financial operations for our properties on Aptech’s Profitvue system,” explained Raija Macheledt, ZMC Hotels’ CFO. “We also combine and process all credit card transactions centrally to keep fees as low as possible, which benefits our properties with lower ADR.”
ZMC began using centralized accounting in 2001 for corporate financial management, setting up multiple companies for its entities and properties, and creating flexible consolidation reports for investors. ZMC’s Macheledt explained, “Our hotels all use Webvue for back office accounting at the property level, and it is interfaced to our front office systems. Webvue lets each hotel run its own accounting system from our corporate back office application over the Internet. The hotels upload their numbers to headquarters daily. The automation is saving us many hours a week in data entry, and our financial information is continuously current and accurate. Our departments for hotel accounts payable, corporate accounts payable, cash management, and payroll are all on time, and we are generating financial statements two days after the end of the period, instead of two weeks.”
About Aptech Computer Systems
Aptech Computer Systems, Inc., based in Pittsburgh, Pennsylvania, leads the Hospitality industry in leveraging change by valuing human relationships and applying technology to solve business problems for people. Incorporated in 1970, Aptech is a financial and operations technology solutions and service company whose products include two state-of-the-art back office and business intelligence products: Profitvue, with its Webvue version, and Execuvue with its Metricvue module. Over 700 users, including very large chains, multiple-property management companies and single site hotels, utilize Aptech solutions to manage their financial and operational data. By offering the hotel industry a solid resource of hospitality professionals, including staff and customers, and through its proven ability to evolve technology offerings as the market dictates, Aptech is proud to have earned 100% customer loyalty.
For more information, visit booth number #1008 at HITEC, or contact: Aptech Computer Systems, Inc. 135 Delta Drive, Pittsburgh, PA 15238; (412) 963-7440; FAX (412) 963-9799; or access their Web site at www.aptech-inc.com.
Attend a live presentation at HITEC, entitled “Business Intelligence – Performance Management” by Jay Troutman, president of Aptech, on Wednesday, June 23rd, 1:30 to 2:00 p.m. in Exhibitor Tutorial Room A.
Concord Hospitality Enterprises
Highpointe Hotel Corporation
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