Optimizing your hotel organization’s tech stack in 2023: A budgeting primer for a new era of hospitality

Hand of Tech

As 2022 is winding down and a new year is on the horizon, the hospitality and travel industry is in a state of rapid evolution like never before. Nearly three years after a global pandemic turned the industry upside down, travel is now continuing to escalate beyond previous levels. A new era is emerging for the industry and hotel organizations are scrambling to adjust to new norms in guest behaviors and expectations.

A global labor crisis continuing to impact the industry as well, and new technology solutions are central to every hotel organization’s ability to streamline and modernize their operations—whether you are responsible for one hotel or an extensive brand portfolio. But how do you budget for these tech solutions—and even more importantly—how do you choose the right ones for your organization from a complex array of disparate options now flooding the market?

In the following Q&A, Gregg Hopkins, CEO of PROVision Partners and hotel tech industry veteran, provides some insight on how hoteliers can optimize their tech stack in the coming year to ensure success in 2023 and beyond.

What does the global hotel technology landscape look like right now, going into 2023? What has changed over that past year and why?

In the downtime that the global health crisis provided, hotel technology providers had more time for R&D so they all began actively updating their applications, and many of them have now moved them to the cloud – or even better, developed cloud-native solutions. This is great news for hoteliers because it provides them with more operational efficiencies. It eliminates the need for on-premise maintenance and updates of the software, since that’s all handled by the vendor. Cloud solutions are also easier to implement, providing hoteliers with the efficiency they need to fully recover, while reducing the burden on limited staff and minimizing costs.

With travel now meeting and exceeding 2019 levels according to most industry experts, what has changed in guest behaviors and expectations in this post-pandemic era and how does that affect the need for new technology implementation in the hotel environment?

The biggest change between what happened in 2019 and what’s happening now was the pandemic, which accelerated the need for hoteliers to provide the ability for their guests to experience the hotel in a contactless environment – by not having to go to a front desk or have direct interaction with the staff.Technology had to move where the guests are – to the phone – and the mobile phone has changed a lot of that experience. Everything from mobile check-in and checkout, to using the phone to open a door, to requesting services or special requests, to ordering meals on their mobile phone at the property.

That said, the biggest change in guest behavior lies in what guest expectations are – and they’re expecting the hotel is to have the technology that makes their stay easy, convenient and as contact-free as possible. In 2023 and beyond, it is absolutely critical for hospitality organizations to stay ahead of the curve by investing in these technologies, if they want to succeed and remain competitive.

 To what degree does a hotel organization’s technology stack create a competitive advantage or disadvantage in the market?

A hotel or brand’s technology stack definitely has a direct impact on the guest experience. If you deploy the technology and it doesn’t work, it’s worse than not having it at all, because it reflects directly on the hotel. If a guest tries to open their door with their mobile phone and it doesn’t work, and they have to go back to the lobby to get a manual key in order to open the door, that creates frustration. If they go to do a check-in and the check-in process doesn’t work and they still have to go to the front desk, that also creates a poor perception of the property.

The guest doesn’t know who the vendor is, so it doesn’t really affect the technology provider. It affects the experience that the guest is having at the hotel. On the other hand, a good technology at the property where everything works seamlessly and frictionless and exceeds their expectations can have a very positive effect on the hotel and their ability to give that guest a great stay experience – and the reviews will reflect that satisfaction. So investment in technology is key to not only creating a competitive edge but also creating a hospitality environment that encourages repeat customers. With the right hospitality technology, hotel organizations can become more efficient and reduce costs while still providing guests with an unforgettable experience.

What are the primary points of friction/inefficiency hotel organizations need to solve?

At PROVision, we focus on seven technology core areas, which we call the connected guest journey  – and that includes every touchpoint, from the guest’s initial search for the property to the purchasing experience, to the pre-arrival experience, then actually arriving onsite and staying at the hotel, and then the departure experience, and finally, the reflection on guest satisfaction and the reputation of the hotel.

The biggest point of friction is when those seven target areas don’t communicate with one another, so the guest is having to be reintroduced to the property in all of those different areas. For example, if you have told the property at one point in time that you have a shellfish allergy, and that’s on your profile, and that information doesn’t transfer to the restaurant system or to the spa system at a property, and you’re having to constantly remind them, then the guest starts asking the question, why did you ask that in the first place? So, you’re losing the effectiveness of the technology if you don’t have all areas of the entire guest journey connected.

Another part of the connected guest journey that could cause friction is if your booking and check-out systems are not communicating, you don’t want a guest to check in only to find out their room is still occupied or the system doesn’t recognize them. Hotel organizations need to ensure that all of their hospitality technology solutions are integrated and can communicate with one another in order to create a seamless experience for guests and avoid frustration or confusion.

Based on that. which emerging technologies options should hoteliers be looking to add or upgrade in their tech stack and why?

I think the most important technology for a hotelier is the customer relationship management system that serves as a central guest profile that populates data into all of the other technology systems that are on the property – like the property management system, the restaurant reservation system, the spa system, the golf system, and the enhanced housekeeping system.

That CRM should be collecting data from all of the profiles that are being kept in those disparate systems. So, the CRM is where you get a full view of the guest and you understand what their preferences are, you understand what their expectations are, and you understand what their past habits were along the way. CRM can be the key to the whole thing if you’re doing “best of breed”. Now, if you’re going with an ERP where everything is in one big system, that solves itself, but otherwise, if you don’t have a connected CRM in 2023, you should be looking to upgrade. This will allow you to provide a seamless experience for their guests, while also gathering valuable data on customer preferences, expectations, and past habits. Additionally, hoteliers can look into emerging technologies such as artificial intelligence chatbots, and self-service tools that can help automate tasks such as customer service inquiries

What are some of the biggest mistakes that hotels make when integrating technology?

The biggest mistake we see is when hoteliers don’t take a holistic approach to the entire enterprise at the property. They’re buying and implementing technology that fits in a silo without really exploring how that affects the other pieces of the enterprise and what it integrates with. For instance, does it talk to other systems or is it just living by itself? A hotel may find a cool solution that does one thing, and after they implement it, they discover that it won’t talk to anything else. So quickly, it becomes very inefficient and can cause more work for the hotelier, rather than less. With today’s struggle that hospitality has in the labor market, this is really a great time to use technology to help solve that problem.

Another mistake is having an effective timeline. Many companies try to rush to implementation, often without taking the time to understand how the technology works or plan for any potential issues. It’s important for hospitality organizations to take a step back and ensure that they are making an informed decision about their tech stack. This includes researching products, understanding integrations, testing solutions before implementation, and getting expert advice from hospitality technology consultants like PROVision Partners, whose leaders have all been in their shoes at one time.

In your opinion, what is the best model for a 2023 technology stack? On-premise? Cloud? Hybrid? Open APIs?

If your property has reliable access to the internet, cloud is obviously the best solution. There are situations where that’s not an option, so a hotel may have to stay with on-premise – but in most parts of the world today, using a solution that is in the cloud is the best solution for a technology stack. However, an even greater consideration is whether the cloud solution has open APIs to other systems, so you won’t be encumbered when you add solutions that need to talk to that cloud-based solution and have to depend on two vendors to work with each other to develop and integration – and that can be time-consuming and expensive. Open APIs really help to facilitate that process.

All in all, the cloud is the most reliable and cost-effective option for hospitality organizations in 202, given its scalability and accessibility. Open APIs are also crucial since they enable hospitality organizations to integrate disparate systems, ensuring that all of their data is connected and accessible. This will be essential for hospitality organizations to stay competitive in an ever-changing landscape.

Does a hotel’s technology model need to change based on changing market conditions and if so, why?

Every hotel organization should make sure to look at the service agreements they have with their existing providers. Legacy systems are still surprisingly common in hospitality, with many organizations having to pay for costly on-site maintenance and upgrades. There are better solutions available now and the cost should be going down, not up. For example, when you move to the cloud, the cost of your enterprise should be less, because you no longer need to have someone onsite to update systems as they become available. Also with new solutions that have been introduced to the industry, some of the subscription-based pricing is less than it might have been three or five years ago.

Hospitality organizations also need to be thinking about how to modernize and future-proof their technology stack, so that it can grow with their needs over several years and doesn’t become obsolete. Keeping an eye on the hospitality market and researching new solutions is essential for hospitality organizations to stay ahead of their competition. 

Overall, what does success look like for hotel organizations in 2023?

To ensure their success over the next year and beyond, I’d encourage hotels to look at our model on the connected guest journey and to do an internal audit to analyze all the target areas of the organization that we look at  – then connect all the dots to make sure they have the right solutions for all their needs – whether guest-facing or back-of-house – and that everything is integrated properly to have a single source of truth for their data. More importantly, they need to ensure that their guests have a great technology experience when staying at their hotel properties, so that they will share that experience with others and keep coming back. After all, guest satisfaction has always been the heart of hospitality – and that is one thing that hasn’t changed.  

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