Critically Evaluate How ICT Is Applied to Hospitality Industries - Research Paper Example

 Critically evaluate how ICT is applied to Hospitality Industries. Introduction: The world has now become a global village after the advent of internet and advancements in information and communication technologies that further stimulated the growth of networking and enabled individuals to strengthen their relationships. In addition, the advancements in media channels and their heavy exposure to people all across the world introduced people in different regions about demographics, cultures, lifestyles, behaviours and economic developments. In short, media have played a vital role in shaping a unique global culture, which in turn, has created many business and growth opportunities. For example, a perfume produced in France or United States is also demanded by a buyer in any third world nation who can afford its price. A marks and Spencer shirt brand is purchased in various emerging economies where demand exists. Indeed, it must be forgotten that this internationalisation of trade and elimination of trade barriers have also enticed many new entities, firms and business enterprises with an inclination to reap monetary gains by catering a large of willing and able customers. In short, competition among businesses is increased, which ultimately benefits consumers who are bombarded with variety of products available at different prices. Businesses, therefore, have started using Information and Communication Technology such as use of internet to ensure their web presence, induction of Information systems for example Point-of-Sale systems for inventory management, record keeping, customer recognition etc. In addition, businesses are also using mobile technologies to restore their competitiveness and gain a competitive edge over their rivals in the same industry. This paper will through light over the use of Information and Communication Technology in United Kingdom’s tourism and hospitality businesses. Indeed, many UK based hospitality businesses have employed information systems to improve their customer services while simultaneously increasing organisational productivity, efficiency and effectiveness. This also enables them to lowers their aggregate costs and become cost efficient. Indeed, tourism or hospitality businesses have now decent web presence through which they market themselves thereby informing potential customers about their services offering and prices besides providing tour guide. The paper will reveal the extent to which Information and Communication Technology is used by UK hospitality businesses and what real benefits (and demerits) do they receive from this induction. The researcher will choose a tourism business “Viator Tours” as its Case Study to reveal the scope of ICT in Tourism Industry. Viator tour has already established a strong online presence (viator.com) through which it offers its travel and tourism services. In addition, the company guarantees low prices, no hidden fees, hand-picked tours and experiences, 24 / 7 customer support from its call centres etc. In addition, the company has formed cordial relationships with hundreds of travel sellers and hotels. Methodology: The best way to commence your research is to access Secondary sources (already published material such as reports, books, news and magazine articles, academic journals etc) to get an insight about past knowledge and contributions from other authors. These sources are easily available in libraries and on internet, yet they can be out dated or may contain some irrelevant material. However, the researcher still has conducted comprehensive secondary and used relevant journals and other academic sources to prepare literature review and case study sections because of time constraints. However, some primary research through an Online Interview has also been conducted from an IT expert employed at my chosen Tourism business who provided some useful information regarding the use of Information and Communication Technology in that hospitality business. The primary research has enabled the researcher to throw light upon some technical aspects that will be discussed in the case study section. Literature review: Irvine and Anderson (2005) highlighted the fact that tourism Industry in United Kingdom is one of the most important revenue generating industries and a significant user of Information and Communication Technology. Indeed, these businesses resulted in direct and indirect employment of nearly 5% (1.4 million) of total UK workers in 2005 – 2006 as quoted from Labour Market Trends report (2005). Information Technology is utilized to reduce major tourism barriers such as ‘distance’ and infrequent / ineffective ‘communication’ with potential clients. Irvine and Anderson (2005) referring Milne et al (2005) pinpointed the fact that information and communications technologies can improve the overall goal accomplishment and performance of hotels and restaurants. Employment of ICT applications such as websites, social networking, mobile technologies, automation systems etc. would result in reducing response time to interested clients, immediate answering of enquiries, minimising or completely eradicating the chances of errors often occur due to manual systems, in managing large operations and workload, in increasing employee’s marginal productivity and in adjusting / adapting to market changes (through adoption of Glocalisation, Localisation, Standardisation and brand adaptation strategies. In short, hospitality businesses can manage and improve both demand and supply sides thereby enhancing their monetary gains and margins. In short, this will lead to better marketplace reputation and goodwill. (Irvine and Anderson, 2005) Hospitality Industry is a broad term used to indicate businesses that are indulged in providing travel, tourism, and hotel accommodation services to tourists and visitors all across the world. These businesses are now heavily dependent on the use of Information and Communication Technology so that they could become competitive, improve customer perceived value, loyalty and finally the long run financial gains, which is ultimate objective to be accomplished. Internet: First of all, these hospitality businesses have now developed their individual websites (actually the use of internet) to inform customers about their market offerings, services and prices they charge. Travelling and tour agencies have developed their Websites to enhance their interaction with their existing customers and to improve contacts with new clients. They design their websites in a way that provide complete information about their bookings offices, their contact numbers, the locations they offer for tourism and travelling, prices for tickets, any accommodation packages, and available discounts and monetary incentives to entice customers and trigger their purchase responses. In addition, they also offer online ticket and hotel reservation services, since they provide useful links and email addresses (for further info) to their respective buyers. Indeed, a great number of businesses in hospitality industry have now their own Websites that provide sufficient tour guide. Online Social Networking: Secondly, these businesses are using New Media including online digital communities such as Face book, Twitter, My Space and blogs to attract online visitors towards their services. It is worthwhile to mention that these above mentioned web communities have now become an inevitable part of lives of millions of customers, and unequivocally an important marketing tool for tourism businesses that establish their fans club, groups and members area over these online communities. Their members, who do not often visit their official websites, are kept in touch through new offers and regular updates by moderators of these tourism related groups. Mobile Technologies: As Carlsson, Joanna and Walden (2005) highlighted in their research paper, the use of latest mobile technologies and ICT applications such as Mobile Reservations, Mobile Information and Mobile check-ins are on rise in United Kingdom’s travel and tourism industry. The main reason behind this is the fact that mobile technology enables greater flexibility due to portability / every where connectivity and is highly convenient for travellers and visitors. The hospitality businesses, especially, those associated with accommodation, hotel chains and restaurants can offer ‘Smart Services’ to potential travellers and visitors. The first and most common use of mobile technology is the development and implementation of SMS marketing softwares that enable the tourism businesses to provide updated information about new business policies, routes, discounts and incentives for families, excursions, tour guides, movie shows, concerts, sports events, tickets and passes, changes in help line numbers etc. to their members and customers. Indeed, this is one of the best options used nowadays to lure customers towards new and existing products. In short, it enhances personal interaction. (Carlsson, Joanna and Walden, 2005) Furthermore, the Carlsson, Joanna and Walden (2005) pinpointed about the offering of ‘Mobile Information and Room Reservation services by Hotelguide.com’, a Switzerland based travel and hotel business. Indeed, the company has maintained a hotel directory comprising of more than 100,000 hotels across the world. Pertinent information (in multiple languages) regarding their available rooms and facilities, telephone numbers, email address and location is compiled to facilitate their members. Hotelguide.com does not charge any fees for this service. Indeed, this information can be accessed by using mobile internet technology in Wireless Automation Protocol, Personal Digital Assistants or handhelds, i-Mode etc. As far mobile room reservation through mobile internet service is concerned, various hotel and tourism businesses offer this facility. Visitors first research for their desired hotels (considering their affordability, past experiences, tastes and preferences) located in different regions. Secondly, they evaluate their market offerings and room availability, history and tour guide, safety and security concerns etc. Once, they are satisfied, they book their suites or send an email request to hotel representative. Often, they call to complete their transaction or reservation. It is worthwhile to mention that visitors may also cancel their online reservations by just a single click or through an online form. However, hotels charge some additional money as a penalty or fine for cancellations, which is then used to cover mobile technology maintenance costs. (Carlsson, Joanna and Walden, 2005) Another Mobile Technology application as implemented and utilised nowadays is Mobile check-in that facilitates Hotel management services. First-line hotel managers such as supervisors, receptionists, clerks etc enable the hotel staff to “check-in customers and produce room keys wirelessly at any location of the hotel thus improving the customer service by reducing waiting time.” (Carlsson, Joanna and Walden, 2005) Information Systems: Tourism businesses, especially hotels, have employed modern Information Systems to automate their process from traditional manual recording systems. Some examples of these information systems as highlighted by Amanda (2010) are ‘Group-wide Systems (for inventory management and record), Property Management Systems (to facilitate in management, accounting and marketing operations) and Computer Reservation Systems (to assist in dealing with online and physical walk-in reservations and cancellations)’. (Amanda, 2010) Case study: Viator is one of the leading tour operators and travel service provider that attract hundreds of thousands of travellers and visitors all across the world. The company offers its travel services in all major destinations such as Berlin, London, Washington etc. and has expanded its network to more than 400 destinations across the globe. Viator has employed qualified and well trained personnel who work for organisational goal accomplishment and customer satisfaction. Viator claims that it is not simply a travel and tour operator but it sells an experience to its clients. As far as use of Information and Communication technology is concerned, it is worthwhile to mention that Viator has employed modern Information Systems, in addition to its call centres and web presence, to improve customer services, productivity, cost efficiency, performance and effectiveness. First, I would like to throw light over Viator’s web presence and use of internet as an effective marketing and business advertising tool. Indeed, “Viator Tours” has developed a very comprehensive and in-depth official website namely www.viator.com that provides almost all relevant information to potential travellers and visitors. Without any doubt, the website has won various awards and accolades. In short, it has now established excellent market reputation and goodwill among its customers, travel sellers, hotels, tour guides, hotel sponsors and partners etc. The website is designed in a way that it provides contact numbers of company’s booking offices to both United Kingdom and United States visitors. In addition, it provides links to all available destinations, flights, available hotels, exhibitions, events, concerts and shows, functions etc. so that visitors can make their travel destinations. Furthermore, the customers are also offered extra mileages, gifts, discounts on tickets and passes on online shopping and hotel reservations through Viator. The website is not complicated and offers reliable and secure online reservation through Visa, Master, Credit or Debit Cards. The company ensures Privacy of their customer’s information and has zero fraud / larceny / online theft record so far. The website is maintained and regularly updated by expert IT professionals and web specialists who are also responsible for its Virus Management System (protecting websites from hackers’ attacks and viruses). It must be highlighted that Viator strongly focuses on Online Social Networking. It has established its fan club and groups on Face book where its existing and potential customers remain updated by changes and travel offers on regular basis. These groups and fan clubs also provide complete information about the company and its business, its services, relationships with partners and experiences of visitors who traveled through Viator. In addition, Viator has also been utilising Twitter as an effective marketing and advertising tool where its customers follow the TWEETS (scraps or status updates) from group moderators associated with this leading tour operator. Finally, it must be pinpointed that its website also provide a link (accompanied with logo) to its groups and fan clubs created at online digital communities. Viator also has its own Viator Blog where its website visitors post their reviews and provide feedback regarding customer services including educational and family tours, day trips. It is worthwhile to mention that Viator has a Twenty Four hour / Seven Days (24 / 7) customer helpline and web service that is provided through its efficient call centres established in different cities. The web operators and representatives assist users in booking / registration process and answer their queries in a friendly manner. As far as hotel and accommodation services by Viator is concerned, it is worthwhile to mention that Viator has established partnerships with many 3-, 4- and 5- star hotels across United Kingdom, Germany, USA, France, Italy etc. Many of its partners use SMS marketing softwares to improve direct contacts with customers, however, some of it partners use all mobile technologies such as online Mobile Information, Mobile Reservation / Cancellation and Mobile Check-ins. Indeed, most of the US hotels that have partnered with Viator are providing mobile information and mobile reservation / cancellation services. Indeed, a majority of hotels that offer mobile reservation services impose a fine on customers, travellers and visitors who cancel their reservations. The reason behind this is the fact that costs escalate when a traveller books a suite but then cancels his or her registration. In the mean time, hotels may also lose potential customers who previously opted to book rooms that were initially booked online through mobile internet service. The Mobile Check-ins service is usually offered by large hotels with enormous sales potential and with hotel chain in other cities or countries etc. These businesses do not compromise over Customer Care Services, as their customers are the actual assets that bring profits and monetary gains. Finally, these businesses have now employed new Computer Reservation system, Inventory Management system, Financial Accounting softwares and Pay roll systems so that they could keep updated records of inventory, reservations and cancellations, cash inflows and outflows, employees’ salaries and wages etc. All in all, this use of information technology results in excellent customer service, employee management, sales management, ‘travel agency tracking and commission payment, tracking of frequent flyers and repeat hotel guests’ etc. Hotel management becomes easier from employment of Information and communication technology. (Amanda, 2010) Finally, it must be highlighted that Viator differentiates itself as it does not any fee for change of dates, does not penalise visitors who cancel online bookings before 7 days of departure (suppliers can do if they have a policy) and it offers frequent-flyer miles on all qualified bookings. Research Findings and Conclusions: The research conducted by the author reveals the fact that almost all medium and large sized hospitality and tourism businesses are using Information and Communication Technology. Most of the businesses have developed their web sites through which they offer their flexible services and enable the customers to enjoy a hassle free booking online experience. Also, a large number of businesses are using latest mobile technologies, through which they remain in contact with their clients, ensure direct and personalized marketing, record keeping, customer flexibility and cordial relationships. Moreover, almost all businesses have their own call centres and communication networks that provide help line services to potential and existing travellers and visitors. It is worthwhile to mention the fact that all mobile technologies as mentioned in this research are not used by all businesses since they are not operationally, technically or economically feasible for buyers. As far as social networking is concerned, most of the hospitality businesses are using this technology because it is easy to use and absolutely requires no cost for creating groups. References Amanda (2010) “ICT and e-Hospitality” Available at http://hotelmule.com/hospitality_travel_wiki/wiki/ICT%20and%20e-Hospitality Carlsson, Christer, Joanna Carlsson and Pirkko Walden (2005) “MOBILE SERVICES FOR THE HOSPITALITY INDUSTRY” Available at http://is2.lse.ac.uk/asp/aspecis/20050150.pdf Wilson Irvine and Alistair R Anderson (2005) “I CT,(Information Communication Technology), Peripherality and smaller hospitality businesses in Scotland” Available at https://openair.rgu.ac.uk/bitstream/10059/212/1/Anderson10.pdf Sigala, Marianna (2001) “Unravelling the impact of Information and Communication Technologies (ICT) on restaurant Productivity” Available at http://is2.lse.ac.uk/asp/aspecis/20030144.pdf Technology Strategy Board (2008) “Information and Communication Technology” Innovateuk.org Available at http://www.innovateuk.org/_assets/pdf/corporate-publications/ict%20strategy.pdf European and Mediterranean Conference (2009) “DESTINATION COMPETITIVENESS THROUGH THE USE OF INFORMATION AND COMMUNICATION TECHNOLOGIES” Available at http://www.iseing.org/emcis/CDROM%20Proceedings%20Refereed%20Papers/Proceedings/Presenting%20Papers/C43/C43.pdf Wayne Pease and Michelle Rowe (2006) “AN OVERVIEW OF INFORMATION TECHNOLOGY IN THE TOURISM INDUSTRY” Available at http://eprints.usq.edu.au/245/1/Pease.pdf European Market Watch (2003) “ICT & e-Business in the Tourism Sector” Ebusiness-watch.org Available at http://www.ebusiness-watch.org/studies/sectors/tourism/documents/Tourism_2003_II.pdf DEVON (2009) “Devon County Council’s Role and Action Programme” Devon.gov.uk Available at http://www.devon.gov.uk/tourismactionplan.pdf Read More