Hospitality and Tourism Facilities Management Computers in Hotels - Essay Example

value is a strategic weapon in attracting and retaining s but delivering superior value (SCV) is an ongoing concern in building and sustaining competitive advantage (Wang, Lo, Chi & Yang, 2004). The source of customer value depends upon the organizational resources and capabilities, such as human resource management, innovation, knowledge management, organizational culture and structure (Nasution & Mavondo, 2008). To deliver SCV the hotels need to provide the best quality, best prices, and best service. This requires that they view themselves as value-producing entities. They have to employ best practice and innovative thinking at all levels including their mission, strategy and systems. The process of delivering customer value in a hotel setting involves three parties – the employees, the managers and the customers. Consequently, the possibilities of errors are high. While there are several tools and techniques available today to deliver superior customer value, hotels are increasingly realizing the importance of computers in its operations and management. However the application of computers has to be well integrated and aligned with the objective of delivering superior customer value. A computer system – made up of hardware and software, has four distinct characteristics that make them useful – speed, accuracy, discipline and capacity (O’Connor, 2004). Computers work at electronic speed and can process thousands of transactions per second thereby completing large and complex tasks quickly. Accuracy is perfect and they can perform repetitive tasks without getting tired, bored or distracted. Computers can process large amounts of data easily and they are able to perform more in-depth analysis and consider more variables than would be possible manually. The accuracy of computers helps to reduce mistakes. The staff is relatively free to have personal interactions with guests as they are not bothered with routine clerical work. Thus computers enhance productivity while also resulting in cost savings. While the use of technology and computers in different industry sector has met with success, it has only recently been incorporated in the hospitality sector. In the UK the smaller hotels still do not benefit much from the use of computers beyond word processing and maintaining accounts (Buick, 2003). While most hotels do have a website and find the internet a useful channel of distribution, very few utilize the computer technology in enhancing the efficiency of its operations with a view to deliver superior customer value. Globalization and technological advancements have changed the way people travel (Erdly & Kesterson-Townes, 2003). Technology provides unhindered access to information. In the hospitality industry customers are central to the corporate strategy. Wireless broadband, biometrics, and customer relationship management have enabled the hospitality firms to make travel a powerful personal experience. The application of computers in the hospitality operations are immense and range from reservation system to recipe costing, property management, stock controls, conferencing and banqueting (O’Connor, 2004). Hybrid computer systems in the hospitality industry can post telephone call charges directly to the guests’ bills, assist in food and beverage services by electronically transmitting orders to the service areas like the kitchen and also by directly posting the charges on the guests’ bill. It also provides a variety of management information and analyses. The hybrid computer systems further help in saving energy by automatically switching off services to unoccupied areas and also helps in providing entertainment to the guests in the comfort of their rooms. Electronic door-lock system is another benefit of hybrid computer technology through which it is possible to improve security by generating a unique electronic key for each new guest. All these ultimately deliver superior customer value while benefiting the hotel as well. The IT has reshaped the basic structure of the hotel industry as it enables the customers to have a better experience and the hotel staff to work more efficiently to serve the customers. The use of IT can place knowledge and information at the core of a hospitality organization’s competitive profile. If the hotel employees are not well trained in technology they would be reluctant to implement in the service offering to the customers. Providing business services has become important to customers at the hotels and a study of the Hong Kong hotels suggests that hotels could provide all facilities like computers, e-mail, fax, internet access and printers (Law & Jogaratnam, 2005). These are nevertheless the basics in computer and Imply that computers were just used to duplicate the existing paper system. A computer should be a part of the strategic planning process and not be merely used for clerical functions. They have to go beyond handling the data processing. It needs to be integrated to enhance the service quality in the hotels. Computer technology is applied at two levels in the hotels – for in-room guest services and at the managerial and operational level. Through this technology the hotels can provide in-room services like multiple telephone lines, electronic meal ordering, self-check out and self-wakeup systems, business services, entertainment like internet and video-on-demand (Lee, Barker & Kandampully, 2003), video check out, electronic in-room safes, and a software library (Victorino, Verma, Plaschka & Dev, 2005). Technology has increased choices in entertainment and the extent of such services that the hotel can provide to the guests depends on variables such as the location. City centre hotels would be able to provide more in-room facilities for business travelers than hotels in remote locations (Lee, Barker & Kandampully, 2003). In-room internet access has profound impact in enhancing customer value especially for the business travelers (Victorino et al., 2005). Personal communication channels like face-to-face, mail, phone and the web have impacted the way a customer interacts with a business (Spencer-Matthews & Lawley, 2006). These help to identify and meet individual customer needs. It is now possible to collect information, maintain and retrieve it through a marketing database. Information accessibility is the key to success which was not available in the traditional form of business. While technology has enhanced service, it has also made service today ‘self-service’ (Schulze, 2000). Phone calls at hotels are computerized but monitored. Self-check out and self-wakeup systems are part of the self–service technologies (SST) or hybrid computer technology used at hotels. This replaces interpersonal delivery and has great implications in delivering value to the customers in the hospitality industry. Customers who are used to personal assistance in their service encounters may not be keen to adopt the SST. The replacement of human service by technology requires development of knowledge, training of the people who would use it, increased customer participation and responsibility in the production of service (Lee & Allaway, 2002). Hilton had started self-check-in kiosks at its hotels in 1997 but was unsuccessful. They again attempted this service in 2004 but they decided that the process should be simple (Dragoon, 2005). The steps should replicate the steps of the familiar check-in process so that self-service seems logical to the guests. This time they were successful in implanting this technology. One day in March 2004, Chicago Hilton & Towers with 1544 rooms was expecting 1100 arrivals. This can lead to significant lines at peak check-in times but the self-check-in kiosks processed 33 percent of the day’s check-in and there no line at the front desk all day. This suggests that simply incorporating technology is not sufficient; technology should be user-friendly and familiar to the guests. At the same time, using self-service technology does not mean that guests should always be left to fend for themselves. It has to be a assisted self-service model with a service agent available at hand to teach the guests hoe to use the technology should they run into trouble. The agents also serve as greeters who assist the guests with any questions or concerns. Apart from direct benefit to the customers, technology helps in enhancing the service delivery. Property Management Systems (PMS) is used in reservations, cashier and housekeeping to assist with interconnectivity and decision making (Lee, Barker & Kandampully, 2003). Sheraton Hotels New York has a PMS system that links all its three hotels which integrates its management and operation functions. This way they have all the data of the regular customers available at hand and it helps them to understand the customer needs thereby enhancing the service delivery process. The tourism intermediaries are also able to obtain vital information about their clientele which helps to serve their clients better. Computer technology is used in F&B in many hotels but this by itself does not enhance productivity. If this is integrated with PMS it enables synergies and coordination among various hotel divisions (Sigala, 2003). The F&B managers can better schedule their operations when they have information about the room occupancy levels. Marriott’s room reservation system manages the bookings of 355,000 hotel rooms globally. They are able to collect information about the habits, characteristics and the preferences of the people who travel and stay with them regularly (Lee, Barker & Kandampully, 2003). The database allows the hotel to cross reference the personal profiles of the customers with product preferences. It assists the hotel group to target the specific incentives and promotions to a specific group. Brisbane’s Marriott Hotel has adopted a new technology called “Suite Technology Systems Network’ through which Marriott is able to provide its customers with facilities such as business centre and internet café. Hotels use computer technology and internet as a means of distribution. Hotel distribution channels have two functions – timely, accurate and high quality information distribution and convenience in terms of finding information as well as facilitating purchase and payment process (O’Connor & Frew, 2004). In the tourism sector the electronic distribution system was first stared by the airlines by developing the global distribution system (GDS). The larger chains in the hotel industry developed their own systems with more appropriate data architecture while the independent hotels and the smaller chains used alternative methods like outsourcing or making use of public funded Destination Management Systems (DMS). Murphy, Olaru, Schegg and Frey (2003) suggest that computer technology should not be restricted to website presence and online bookings. It should be used to enhance customer communications to generate greater returns. E-mails provide a more personalized interaction with guests than merely clicking through the website. The focus of the hotels till the late 1990s has only been to enhance revenue through technology while failing to give strategic priority to improving web-guest services. Database marketing can be used towards enhancing relationships. Customer-relations in the hospitality industry have a threefold dimension - customer-centered service process, managing database communication with customers, and creating superior value for customers. The service process hence includes all activities and encounters that the customer has from the time he searches for information, to making a booking and till the time he leaves the property. Website features should be such that the customer finds the process smooth and comfortable. Database communication has to be managed such that customer information is extracted. This is possible through internet cookies which is a way to track how repeat customers navigate the site. Adding value to the customer’s experience is to increase the relationship’s long-term value both for the first time customers and the repeat customers on current and future transactions. Service encounters should be personalized and if there have been lapses, amendments and compensation should be provided. All of these services deliver superior value to the customers right from the point when they start the search process for the hotel reservation. If the first guest encounter has been pleasant, the total experience and impressions would be based on that. Customer relationship management (CRM) is the catch word in every sector and computer technology has enabled the services industry to enhance this relationship. It has also been used in the hospitality industry extensively. Through CRM hotels expect customer loyalty to increase but Inge (2008) contends that a good experience at the hotel does not directly translate into loyalty. Expecting good service is a right of the customers and they have no second thought in switching to another hotel the next time. Hence what matters is to provide the best possible service for all the guests so that they do not have a reason not come back. All the traditional hospitality systems like the PMS, e-mail marketing, web-marketing have to work together to provide a unified experience. A customer-centric approach treats every customer uniquely and individually. This requires that the value of the customer is calculated over his entire relationship with the firm and not based on any particular transaction (Bose, 2002). CRM can thus encourage repeat business from the existing customers through better awareness and satisfaction of their wishes, habits and preferences. This implies that the stay should be as closely tailored to the guest’s wish as possible. Information on the guests can be collected through database management and this information can be classified into four main types – behavioural, preferences, inferred and public data (Inge, 2008). The computer technology allows the webmaster to collect information on the guest’s interests by tracking click-throughs on the website or from marketing e-mail. The behavioural profile can be collected by following the activities from the previous stay and preferences can be learned through direct input from the guest. The more information that can be collected about the guest, the better can be the service delivery. Le Pavillion Hotel, New Orleans installed the CRM system initially only to e-mail confirmations to guests which they could not handle through their PMS. The satisfaction level went up immediately as the guests received the confirmations in a more personalized form. They now generate pre-arrival messages to confirm the guest’s stay and the post-departure thank-you emails with a satisfaction survey all with the same look and feel as their website. The response rate to their surveys has increased by 20 percent. Hyatt has gone a step further in its CRM activities. It has started eConcierge service in 2006 in which they contact the guest before arrival and suggest activities or pre-arrange anything that the guest may wish to do during the stay. They also attend to in-room requests like arranging for cribs or roll-away beds or even arranging for a birthday cake. These services have reduced the number of no-shows and thereby improved revenue generations. Through computer technology it is also possible to track the response time to specific types of requests. This can lead to work flow realignments for quicker action and better service. Basically CRM needs to be implemented with appropriateness. Whether or not to deliver superior customer value depends upon the hotel size and location. For instance, a study of Thai hotels suggests that hotels in highly competitive locations, particularly if they have large number of guests from the US and Europe are more likely to incorporate computer technology into their operations (Cameron, 2007). Older properties have become complacent as they feel they are established and not too keen to invest in technology. Most hotels continue to carry on with the PMS to manage the room inventory, record guest details and produce billing information. Hotels that are a part of a chain or a franchise group use the central reservation system (CRS). The smaller hotels restrict the use of computer technology to accounts and wages but not for managing front office and booking purpose. While computers provide immense benefits, these benefits are not automatic. Computers are merely tools to automate the manual processes to enhance efficiency and control. Computers cannot compensate for management shortcomings and hence in poorly managed properties, the management finds a convenient excuse for all operational problems (O’Connor, 2004). Along with the computers the process and the people are equally important. The people must be willing to apply the technology; they must have the necessary training and ability to use the system and programs. Apart from this, the right to privacy of data should not be encroached upon. Privacy regulations have to be complied with for instance what data can be kept for how long and for what purpose (Inge, 2008). A European Commission recommendation states that personal data of users conducting a search should not be stored or processed beyond providing search results. If the user has not created an account it should not be used to send personal advertisements. CRM technology should not be abused as it can offend the guests. Misusing or losing control over confidential guest information can lead to loss of reputation and financial losses arising from personal identity theft. It can thus be seen that many countries including the UK have been slow in accepting computer and information technology at the hotels. While most have a web presence and use it for word processing or for managing accounts and wages, very few have adopted it for enhancing customer value. Use of technology depends to a large extent on the location and the size of the hotel, apart from its affiliation to the larger chains. Some hotels have a web presence but the online service encounters are inefficient. Some hotels like the Hilton started incorporating technology into service encounters at the hotel but were unsuccessful. It is only in the last five years that technology has actually pervaded the larger chains and is used to enhance the customer experience. However, self-service technology cannot be used by itself. Human beings psychologically require some one to attend to them. They like to be the focus of attention and they like to be pampered. Hence self-service technology has to be coupled with human interaction because some may not even be familiar with the technology or may need minimum assistance. While services like electronic door-lock and self-wake up systems are fine, check-ins do require assistance and cannot be left solely to technology. CEM is used extensively to enhance relationships by collecting personal information. Hotels use technology to collect personal information and then use this database to segment the customers and make personal offerings. Personalizing services and experiences are desirable but the governance and regulations have to be complied with. The hotels need to ensure that the people are trained to use technology to provide superior customer value which ultimately translates into profits for the hotel. Information should not be abused which could be detrimental to the growth and reputation of the hotel. They have to be aligned with the objective of providing superior customer value. Reference: Bose, R. (2002), Customer relationship management: key components for IT success, Industrial Management & Data Systems, vol. 102, no. 2, pp. 89-97 Buick, I. (2003). Information Technology in small Scottish hotels: is it working? International Journal of Contemporary Hospitality Management, vol. 15, no. 4, pp. 243-247. Cameron, A. (2007). Information and Communication Technology in Auckland Hotels: Context and Impact. Retrieved online 24 April, 2009 from http://repositoryaut.lconz.ac.nz/bitstream/10292/212/2/CameronA.pdf Dragoon, A. (2005). Six Simple Rules for Succesful Service. Retrieved online 24 April, 2009 from http://www.tabpi.org/2006/htag.pdf Erdly, M., & Kesterson-Townes, L. (2003), Experience Rules, Strategy & Leadership, vol. 31 no. 3, pp. 12-18 Inge, J. (2008). Lets Get Personal. Hospitality Upgrade. Retrieved online 24 April, 2009 from http://www.hospitalityupgrade.com/_files/File_Articles/HUSum08_Inge_CustomerRelationshipManagement.pdf Lee, J. & Allaway, A. (2002). Effects of personal control on adoption of self-service technology innovations. Journal of Services Marketing, vol. 16, no. 2, pp. 553-572. 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Service innovation and customer choices in the hospitality industry. Managing Service Quality, vol. 15, no. 6, pp. 555-576 Wang, Y., Lo, H. P., Chi, R., & Yang, Y. (2004). An integrated framework for customer value and customer-relationship-management performance: a customer-based perspective from China. Managing Service Quality, vol. 4, no. 2/3, pp. 169-182. Read More