Integrating emerging technology – is this the hospitality industry’s moment?
Times change, as do guests’ preferences. The current nature of guest interactions has presented a unique opportunity for technological advancements to be permanently incorporated into the day-to-day operations of hospitality venues. In this climate, hoteliers and restaurateurs should not only want to consider the service enhancements, safety benefits, and automation that technology can offer, but also, more specifically the true financial implications that the installation of a technology can have on an organization and its impact to employees and guests, alike.
Over the last decade our project teams have conducted hundreds of projects across the globe and have both witnessed the evolution and participated in the adoption of technology being integrated into the hospitality operating model. While such advancements should not be overlooked for their benefits, in nearly all of our engagements we have found that either the total monetary value that the technology can bring to the organization has not been effectively captured – both up and downstream – or persistent routine behaviors and competing processes render the value of fully adopting the technology incomplete.
In this two-part series, we will first walk through the benefits and conveniences that some of the trending technologies can offer. Followed, in the second installment, by taking a deeper-dive into how our clients are partnering with us to leverage our methodology in order to effectively integrate these new tools into both their operation, and more broadly, their over-arching management operating system.
Let’s first explore some of the trending concepts.
Food & Beverage: QR driven dining
Contactless dining is available via QR driven point of sale systems that allow guests to seamlessly access a restaurant’s menu, order menu items, and process payments all from your mobile phone. Going the digital route can allow service staff to reduce unnecessary travel and step away from excess table touches that do not provide guests with additional value. But by simultaneously eliminating unnecessary trips, increasing order accuracy and value-adding interactions, what becomes of the traditional service model? How should section sizes be redrawn? What impact will this have on table turns? How should peak and shoulder periods be managed, and what impact will this have on staffing decisions (e.g. staff counts and roles)?
Food & Beverage: pre-paid prix-fixe menus
Over the last year, fully pre-paid, prix-fixe dining reservations have become more common, largely to navigate health & safety guidelines. This construct allows guests to select from menu items in advance of dining, allowing guests to pick their appetizers through to desserts, and even peruse the beverage options. Implementing this form of dining can provide restaurants with immense insight into potential staffing requirements for both the front and back of house, along with enhanced procurement and a more formalized approach to upselling. Having such detailed cover data allows restauranteurs to better analyze menu consumption and improve the control of food cost. But will the rigidity of the reservation deter guests or reduce the average booking window? How can relationships with suppliers be re-established and what impact could a narrower focus have on the square footage allocated for kitchen and storage design versus the available dining room capacity?
Hotel Operations: chatbots/smart messaging
Chatbots and Smart Messaging infuse artificial intelligence into hospitality by providing guests with platforms that can answer questions, book reservations, offer suggestions, and more – all in real time. These systems can alleviate some of the burden facing call centers and concierge desks, while also reducing the level of human error associated with responding to a multitude of unorganized guest inquiries via email and messaging apps such as WhatsApp, further providing convenience to your guests. At first blush the staffing implications may seem obvious. But what happens if the tool or information is not appropriately integrated across the necessary departments or into existing systems? What are the common questions that the automated service is likely to receive and what will be the consequential impact on the operation from the responses the system provides? What happens when human intervention is necessary and what priority will the request receive? Will the evolving customer journey impact the applicability of the service?
Hotel Operations: occupancy-based sensors/wireless hotel room controls
Occupancy-based sensors and wireless hotel room controls rely on Bluetooth and Wi-Fi connected devices for presence detection to disable electrical and HVAC systems remotely. Implementing these environmentally friendly systems can lead to reduced energy consumption and costs. Guests of the hotel benefit from this technology by eliminating any unnecessary interruptions and a more intuitive approach for amenity deliveries and housekeeping service times. However, what is the real impact that these devices will have on profit margins? How should the traditional service delivery model be adjusted, and the dynamic nature of the activities be managed? What affect could this have on roles & responsibilities and sources of compensation (i.e. gratuity versus wage) for both union and non-union markets?
Hotel Operations: Wi-Fi 6
Next generation Wi-Fi 6 is a welcomed upgrade that nearly triples Wi-Fi 5’s featured bandwidths of up to 3.5 Gbps. With connectivity speeds of up to 9.6 GBPS, Wi-Fi 6 is better suited to the needs of guests within hotels and their growing volume of devices. Additionally, for departments such as Housekeeping and Engineering that rely on mobile devices and interconnected systems to complete daily tasks, increased connectivity can lead to increased labor productivity and decrease connectivity dead zones. Additionally, with the increasing need to be able to host hybrid in-person/virtual meetings, the necessity for sufficient bandwidth and speed has never been greater to capture that type of group business. Finally, the ability to integrate more operational tools onto cloud-based platforms will not only reduce the facility’s necessary IT infrastructure and in-house support, but it will also allow for greater software integration and real-time monitoring and variance control. Yet, what will be the impact on daily reporting? How will this augment the traditional reporting structure, timelines, and control responsibilities of a manager? How will more information being presented with greater frequency alter the length annual planning cycle for an operation and inform adjustments in-year or in-quarter?
One of the vital characteristics of our engagements comprises of effectively understanding the nature, frequency, and time allocated for the key activities of an operation. It is not uncommon for us to find between a third and half of the total time scheduled to be interrupted or excessive. While only a portion of this time can ultimately be removed or reallocated within the operation for a myriad of reasons, technology is with a greater frequency becoming more directly or indirectly a driver of these opportunity levels. Most notably: its absence, improper installation, inconsistency of use, becoming obsolete, lack of effective initial or recurring training, or its ineffective replacement of less-efficient traditional routine behaviors, are commonly the identified themes. What’s more, the full implications of the technology on the organization are often not effectively captured in order to be aligned to, or integrated into, the organization’s management operating system.
In the second part of this series, we will further explore best practices for answering some of the questions posed above, but also discuss how partnering with us can provide the knowledge, horsepower, and burning platform to your organization to fulfill the goals of your operation and generate the desired return on investment when considering technological solutions.