HITEC: Industry must think holistically about tech
 
HITEC: Industry must think holistically about tech
20 JUNE 2018 8:20 AM

A panel of top-level executives speaking at the Hospitality Industry Technology Exposition & Conference said the hotel industry has to adopt broader technology solutions that work together.

HOUSTON—Technology is vitally important to the overall success of the hotel industry, but the industry’s general approach to utilizing technology might be holding it back, according to a panel of experts speaking during the Hospitality Industry Technology Exposition & Conference.

During the “Technology and the power of the C-suite” general session, Ash Kapur, SVP of hotel asset management and CRO for Starwood Capital Group, said he’s witnessed a lot of what the industry does wrong with tech over his years of combing through acquisition opportunities.

“When you look at the tech stack, in most instances you see a lot of band-aids,” he said. “There are a lot of things broken, and it’s not just the companies we’re pursuing. You see it across the landscape of hotels.”

He said the industry’s piecemeal approach to technology can often lead to bad guest experiences. He used the example of a front-desk employee having to ask a guest for a cellphone number at check-in to enable an on-property texting system, when the hotel already had the guest’s phone number in either its property management system or customer relationship management software.

“That’s the break,” he said. “Those are issues that need to be addressed.”

Data and privacy
Each of the panelists highlighted the need for systems that intuitively speak to each other and share important data for both guest-facing and behind-the-scenes improvements.

“Capturing that (data) flow and making it seamless is the challenge,” Kalibri Labs CEO Cindy Estis Green said. Achieving that goal will ultimately lead to a better level of recognition for repeat guests and better guest experiences, she added.

But Barry Goldstein, EVP and chief commercial officer for Wyndham Hotels & Resorts, said the need for seamless data sharing across a property’s systems and across brands comes with the very practical challenge of ensuring guest information remains safe and secure.

“The lens that makes this harder is privacy,” he said.

Panelists agreed that ultimately guests will agree to share data with hotel companies if there is an obvious payoff in terms of an improved experience.

“That’s driven by if you give me a good enough reason (to share information),” Kalibri Labs’ Green said.

She noted the hotel industry has had to shift how it views the ultimate purpose of technology. In the past, technology was largely viewed as a money-saving tool, and any new implementation would have to be tied to labor savings to drive return on investment, she said. But today, guest experience should be the driving factor in considering technology investments, she said.

“Now we’re using technology to be front and center as part of the guest experience and brand definition,” she said.

Challenges of change
There is a level of difficulty inherent in making the large-scale technology changes panelists proposed.

Mark Carrier, president of B.F. Saul Company Hospitality Group, said the strength and scale of some brands—notably Holiday Inn and Hilton—were built on the back of legacy reservations systems that at the time of their initial roll-out were revolutionary. But ultimately, the scale they achieved and the systems they built made it harder and harder for those brands to remain nimble with technology, he said.

“As they built that critical mass, things stopped innovating in some ways, and things got plugged in to that existing infrastructure,” he said. “Now with that huge critical mass, it’s very hard to change.”

Goldstein said the scale of a franchisor like Wyndham can offer challenges. For example, many technology-related decisions still happen on property, and the brand might not even be aware of everything an individual hotel has implemented, he said. It’s important to keep it that way to an extent to allow for freedom, he said, but brands need a solid strategy to address their guests’ and owners’ technology needs.

“There should be a strategy, absolutely,” he said. “But it can’t be all-encompassing.”

He said hotel companies need a plan of attack for each of its technology needs, from distribution to on-property experience and relationship management post-stay.

He said in the absence of brand-wide strategy, “you end up with lots of properties with different strategies and technology trying to piece it together.”

Role of brands
B.F. Saul’s Carrier said ultimately the costs of technology will be borne by the ownership community in some form or another, but the responsibility of innovation falls on the brands, not individual owners.

“From my perspective, brands owe that leadership to their franchise communities,” he said. “They have scale and mass infrastructure to innovate in a way owners can’t. Keep in mind that 65% of the hotels in America are still small business, not big companies.”

But he agreed owners need to be more thoughtful about the payoff for technology investments, comparing it to replacing mattresses to provide guests a better sleep experience, which he said doesn’t have an obvious payoff beyond the long-term value of greater guest satisfaction.

“If (you’re) caught overly ROI-ing every component, you might miss the big picture,” Carrier said.

Goldstein said brand-wide innovations require a balancing act. Part of it is recognizing where in the market brands play and how that impacts guests’ expectations, and another is not setting up your own franchisees to fail, he said. This philosophy extends to not rolling out guest-facing technologies that might be perceived well, but aren’t a realistic option for more than a handful of properties, he added.

“We have to say that if we can’t do it in 9,000 of our hotels, then it doesn’t make sense for us to do it in 10 of them because it creates a false expectation that we’re unable to accomplish,” he said.

Starwood Capital’s Kapur agreed that brand-wide consistency is key and is something that will resonate negatively with guests if not handled well.

“The Residence Inn should have the same experience in Houston as in Dallas,” he said.

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