Monday, November 3, 2014

Disruptive Technologies And The Hospitality Industry - 2

Disruptions in Hospitality

Like any other industry, hospitality is continually affected by new and sometimes disruptive technological developments. Over the course of the last 50 years or so these developments have shaped both the manner in which hotels conduct their business and how guests experience a hotel. Most of the forces of disruptive change have come from outside the industry, but a few have come from within as well.



Beginning in the early 1960’s, the hotel industry experienced its first real disruptive innovation that was to transform the hotel booking process forever. Holiday Inn, close on the heels of the establishment of the Sabre global distribution system, introduced its proprietary hotel central reservation system it called Holidex. This system was revolutionary in that it was the first time hoteliers had a reservation system that was automated to some degree, at least from the customer’s perspective.

As time went on, over the course of decades, Holidex was improved upon and went through a number of iterations before becoming what is now called Holidex Plus by Holiday Inn’s parent company, IHG. The system followed and changed with innovations from outside the hospitality industry. In the 1970’s directly interfacing with travel agents, the digitalization of the system in the 80’s, to becoming the first to be web enabled in the 90’s. During the evolution of Holidex, system improvements were steadily increasing the number of transactions it could manage simultaneously.

In 2011, IHG announced its plan to retire Holidex and modernize their reservation system through project REVolution.  To date, the project is not complete, demonstrating the technical complexity of hotel reservation systems.


Disruptively Transformative Forces of Today

The entire hospitality industry of the future is being shaped today by a myriad of both inside and outside forces. The explosion of online travel agencies, social media, and travel review websites has had a profound and ongoing influence on the future of hotels. All of which has made for an increasingly transparent guest experience. Pricing is available at all times and via multiple channels/devices to all customers. Mobile technology is driving the industry into improved guest relations through such concepts as “virtual’ concierge services and mobile check-in for example. Hotel guests fully expect to have the ability to book their stays on their smartphones and tablets from anywhere. Hotels, whose websites are not designed responsively, can expect their customers to either book through an outside channel or in the worst scenario go elsewhere.

Emerging technologies are available to the hospitality industry involving the utilization of cloud-based technology for data storage without the investment in elaborate hardware or extensive staffing requirements. Systems that perform all the functions necessary to successfully operate either a single hotel or the largest chains, and do so quickly and efficiently, will streamline hotel operations in the future. In the last part of this series we will examine these innovative technologies further. 

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