Revenue Enhancement

By Yoshua Marchiano NIM 2301953441

One of the few functional areas of management that may be viewed as vital to any company’s success is Revenue Enhancement. (Tian, 2014). As a system of management principles and as a technique, Revenue Enhancement (RE) is integrated with various scientific and information technology forecasts, market segmentation, pricing, and other strategies such as selling items to different categories of consumers at varied rates based on the time. To put it another way, according to Guillet & Mohammed (2015), “Revenue Enhancement” is defined as a method for increasing a company’s revenue or output by allocating resources to the appropriate customers in the right places.

Operational conceptual frameworks on Revenue Enhancement include the following:

One theory that deals with transaction costs

transaction cost theory has great potential, according to Khan and Hildreth (2004)

a financial management standpoint for two primary reasons ambiguity

monetary transactions, as well as the commonly acknowledged efficiency value in this sector In theory,

Three kinds of contracts may be used to collect money from such sources.

Salary contracts, shares, and fixed rents are all forms of revenue collection and collection power.

Secondly, the theory of change management

The leader of the company who predicts change and responds effectively and responsibly is now the most important person in the organization. Organizational leaders who foresee and build the future, on the other hand, are even more successful since those who start change are leaders in their field (Romanelli and Tushman, 1994).

A theory of agency

assumes the relationship between company owners and their employees to be one the agency. Developed in 1976 by Jensen and Meckling, the theory of agency seeks to resolve issues that might arise in interactions between the client and the client’s agent (such as shareholders).

References

Huber, Joel; Payne, John W.; Puto, Christopher (1982). “Adding Asymmetrically Dominated

Alternatives: Violations of Regularity and the Similarity Hypothesis”. Journal of Consumer Research.

Kondo, E. (1970, January 01). The effect of revenue enhancement strategies on financial performance Of Kenya Revenue Authority.

Tian X. (2014). The Driving Factors of Hotel Revenue Management Strategy: An Empirical Study Based on Chinese Starred-Hotel Data. Journal of Tourism Science, 28(4), 65-80

Xi, L. (2015). A Study of Pricing Decisions in Yield Management of Hotel. Journal of Tourism Science, 19(2), 43－47．

Guillet, B. D. & Mohammed, I. (2015). Revenue Management Research in Hospitality and Tourism: A Critical Review of Current Literature and Suggestions for Future Research. International Journal of Contemporary Hospitality Management, 2 (4), 52 – 56.

Magut, J., & Maina, K. (2019, October). Effect of revenue Enhancement measures on financial performance of Selected hotels In Eldoret Town, Kenya.

Khan, A. & Hildreth, B., (2004), Financial Management in The Public Sector

Romanelli, E. & Tushman, M., (1994), Organizational Transformation as Punctuated Equilibrium: An Emperical Test, Academy of Management Journal, Volume 37, No. 5