Technology Challenges in the Days of Hyper Competition, Personalization, and Super Hacking
By Gustaaf Schrils, Sr VP & CIO, White Lodging Services
After 20-plusyears at InterContinental Hotel Group, where I finished as vice president of global service management, I have been fortunate to transition from the hotel brand side of the hospitality industry to the hotel ownership and management side as senior vice president and CIO of White Lodging. With more than165 hotels representing 30 different brands, including Marriott and Hyatt, we have 17 new hotel projects under development, 30 independent restaurants in our portfolio, and employ over 12,000 associates. As you can imagine, leading the information technology team that supports this large and fast-moving organization is quite intense, with new challenges daily.
"Understanding the state of your industry is a key strategic advantage as you build out your organizational technology capabilities"
From a strategic perspective, my focus is the implementation and design of technological solutions that fiscally protect the assets of White Lodging and the owners that contract us to manage their hotels. The hotel guestroom is one case study of just how difficult this can be:
• The guestroom phone is sometimes used, but personal assistants like Siri and Alexa are hot. In fact, hotels are already deploying these tools in guestrooms, replacing the phone entirely.
• Linear TV watching is dying, but streaming video is rampant. Many hotels have enabled the streaming of content from guest devices to the guestroom TV; and, Marriott currently has the only license with Netflix to stream its content.
• With today’s guests carrying multiple devices, a family of four could have upwards of 15-20 devices that all demand connectivity. Many hotels are placing wireless access points in every room to accommodate.
• Guests expect on-demand information about the hotel, local amenities and attractions. As such, hotel companies now curate this information and provide access via tablets in the guestrooms.
As a CIO, I must determine which trends will provide our owners with returns in revenue and guest satisfaction that makes implementation costs easier to bear.
Technology professionals are faced with the constant challenge of optimizing around these multi-faceted scenarios. We must think about the latest available tech applications and hardware that can be installed, as well as whether our proposed solutions will help improve operations and revenues in the businesses we support. Understanding the state of your industry is a key strategic advantage as you build out your organizational technology capabilities.
My industry, hospitality, is currently in a state of opposites. One trend is the consolidation of bigger companies, such as the Starwood and Marriott merger. An opposite trend is these same mega-companies creating and building more new brands, boutiques, niche hotels and places that offer guests new experiences. As these parent brands build many competing sub-brands, each with their own standards, continued adaptation is the key to success.
Three drivers I consistently consider in my efforts to deploy technology to help balance market share while increasing guest satisfaction and profitability for my employer and our owners can be described as:
1. Speed and agility
2. Commodity versus Secret Sauce
3. Security and compliance
Speed and Agility: The average attention span of human beings is decreasing rapidly. Research shows that most people want, and feel that they deserve, instant gratification. For us, this results in practical tradeoffs that we must think about. When cabling a hotel, do we use copper or fiber? Copper has good network speeds and may cost less, but fiber can be faster and is more future proofed. Guests want the freedom to connect anywhere and on any device, so networks of just a decade ago that had wired ports and PCs connected are now wireless and open to smart phones, tablets, game consoles, and a host of new connected appliances. This transitions the guest perspective from centralized services to self-service, and forces us to accommodate both sides of the coin.
Commodity versus Secret Sauce: Solution providers once sold and installed proprietary systems. Now, we as an industry seek off-the-shelf hardware for which support can be switched to other providers easily, if needed. However, this dynamic runs deeper than it initially seems. We strive to simplify solutions given that the average human attention span has dropped to eight seconds, according to Microsoft. We try to create easily deployable solutions while simultaneously offering the latest and greatest home- and guest-owned applications in our guest and meeting rooms. Big data, which once provided only general demographic information about our guests, must now deliver specifically-defined personas on every individual. As we wait for development of actionable dashboards that provide this relevant information, we face other variables, including the rapid development of artificial intelligence, windowless browsers and chat bots to keep our guests satisfied at all times.
Security and Compliance: Millennials tend to quickly trade personal information for improved services, upgrades in amenities and discounts on experiences, not products. However, the kind and amount of Personally Identifiable Information (PII) shared is a fine line, and obviously vastly different than older generations. PII could be viewed as more important than Payment Card Industry (PCI) issues. After all, one can set up a new credit card easier than truly erasing an embarrassing Facebook photo. With a few developed nations basically subsidizing hackers, network and data security is of ultimate concern. Deploying chip-and-pin technology throughout almost 200 outlets in a year only leads me to wonder what the next gauntlet will be. Thieves with ransomware have closed down at least two hotels by locking guests out of their rooms. And, while the internet of things (IoT) promises to bring many new and wonderful applications, having everything in a building on the same network is frightening from a security standpoint.
It is likely that you face similar hurdles as a technology professional in your business. As the rate of change and consumer demand increases, we must analyze the challenges and clearly define the root problems. It is imperative that we collectively brainstorm solutions, prioritize them by cost versus benefits, and optimize our operations to implement our ideas quickly—all while being ready to shift when needed as technology, business, and the demands of human nature converge.