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  • Studying about "Revenue Management" is important for MBA (Finance) Students--Part--2

Studying about "Revenue Management" is important for MBA (Finance) Students--Part--2

Continued from Part--1

 

A crucial role is played by revenue managers in revenue management implementation. Skugge (2004) determines that the main reason behind enjoying success by some companies with revenue management is the presence of efficient revenue managers as well as proposes a number of methods to develop revenue management awareness plus training programs. A study was presented by Zeni (2003) that was conducted at US Airways for evaluating the significance of the contributions of revenue managers for a system of revenue management along with the conclusion that 3 percent can be added up in incremental revenue by analysts.

It was presented by Parker (2003) that a support need to be provide and established by airlines to make a ‘community of practice’, an assembly of people related with revenue management and communicate on an continuing basis. This assembly of people takes in hold of the responsibilities regarding the establishment of standard procedures and protocols regarding revenue management.

Revenue management implementation needs management to create a set of business decisions. It is discussed by Yeoman and Ingold (2000) that the process of the decision-making by means of examples from hotels and airlines. Risks are associated with business decisions because as like in case of revenue management decisions. Thus, possible risks associated with the revenue management need to be evaluated by each company. Lancaster (2003) concentrated on risk acquired in the analysis and politics of revenue management how the measurement of risk management is done and methods could be applicable for revenue management practices.

Moreover, companies want to ensure that investment made by them on revenue management could attain the desired return. O’Meara and Delain (2004) exemplify how a business case can be built by a company to measure the incremental costs and revenues linked with enhancing or developing a program for revenue management.

Internet service and IT service

Revenue management too comprises application prospects in subscription services, like Internet service plus information technology on-demand service. In fact, Internet service is a particular case of information technology on-demand service.

Bapna and Nair (2001) determine that for users ISP (Internet Service Providers) has perishable ability for logging, a permanent figure of units, as well as the probability of sectioning price-sensitive consumers. These 2 features are usual for industries, the places of conventionally applying the revenue management. They too recognize that in Internet service, revenue management is dissimilar than conventional purposes. The Internet service is nonstop in time and state, the service and the request occurring at the same time, as well as overbooking is not probable for ISP. In addition, revenue management problem was formulated by them for ISP like a nonstop instance Markov Decision Process for enhancing the low-priced value at the same time as enhancing service levels for the customers of higher class.

Wynter et al. (2004) bring in a model of revenue management for precise information technology service –computing on-demand service. A further analysis was made by Dube et al. (2005) for Wynter et al. (2004) model, both numerically and analytically and brings to a conclusion that revenue management application could considerably enhance revenue of computing on-demand service providers.

 

Continued to Part--3

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