Title: How ICT changed operations of hotel operations esp in room reservation process
Hotel Operations
In simple term, hotel is a place for temporary accommodation. This business process simply requires the customer to check in, make payment in cash, after which the hotel then provides the customer a room and the customer checks out. End of story.
Hotel chains started as an informal link between properties with each hotel recommending other hotel lodging establishments to travelers through intermediaries such as travel agencies. The "referral system" consisted of phone calls from one front desk operator to another.
Hotels that operated had to decide on which market segment to target to position itself against the face of rising competition. Some hotels had to relocate because of rising competition and the savings involved in centralizing operations. The potential for further expansion came about when air travel became popular and cheaper over time. Hotels had to differentiate themselves from competitors by offering membership services. This meant that clients/travelers were offered premium services such as late checkout timings, rooms with better “views”, and increasingly personalized services that catered to their needs.
However, due to many competitors out there in the market, hotels will need to provide more services to differentiate themselves. Few examples of services that the hotel provides include various dining options, a basic television, Internet, swimming pool and etc.
The market for travelling had grown much larger than before and that meant that hotels had to market their hotel rooms differently to different members of the travel community. (from the casual traveler to the retirees who frequently travel, to business travelers who demands certain services.)
The casual traveler had needs such as concierge that provides them with sightseeing opportunities and useful information that will enhance their stay. Increasingly, hotels have to cater to their needs by offering a wide array of services, from launderette, spa, gyms, swimming pools, which is not part of the hotel’s core competencies.
The business traveler on the other hand, had more diverse needs. These include a telephone that allows for global communications; it is the bare minimum for business travelers. Besides the telephone, it was also important that these business travelers had meeting rooms for conventions etc.
Room Reservation Methods used in the Past
In the past, when there was no computer, information would be recorded down on paper. They were in form of booklets or files. Even till now, some cheap motels/family run lodgings are still using paper as a form of recording.
Customers would have to walk in to the hotel or make a telephone call to make their reservation. Passport or IC would be needed. Customers would need to fill up a simple form every time they checks in. The receptionist would then check their records for available rooms by flipping through the relevant pages to check. If there is a room available, a record would be penned down. Payment in cash would have to be made. Upon checking in, a simple key would be given to them.
All the writing, flipping, searching, collection of payment and checking was time consuming and the tendency for human error to happen was high. There was also the problem of finding adequate space to store these records.
Computer introduced to the hotel industries & the increased use of the Internet
When the hotel operation processes increase, more information will be needed to be recorded down. Information such as customers' particulars, type of services provided, usage of services, tracking of customers' usage etc. Records will become complicated and messy.
As such, in order to better cater to the diverse needs, hotels had to outsource the many services they provide to other companies that could offer them cost savings and free much needed manpower to concentrate on their core business – which is to provide quality hotel room services that is unique to the individual traveler.
For example, Ritz Carlton Hotels have an information system that would be updated regularly by staff to reflect the individual customer’s needs such as serving warm water etc. To write down such details on mere pen and paper will not suffice, as it would most probably lead to a huge headache to file and search for the file of each customer. As such, the management information system in Ritz Carlton is a centralized system that is shared across the local intranet via the internet which will enable anyone to analyze and inform other hotels worldwide of such needs when a customer visits any of the other branches elsewhere in the world.
Hotels also had to establish a new type of hotel reservation center offering toll-free service for business commuters, travel agents and vacationers through arrangements with major credit cards, establishing tie-ins with airlines and representatives from other transportation industry members and investigating stronger infiltration of tour and business meeting markets. Hotel reservations that were charged to credit cards were considered "guaranteed" and a hotel room had to be held for the entire night.
Many hotels now also begin using online surveys to keep track of customer satisfaction, one of the first steps in leading the industry in superior customer care. Room reservations moved from the simple call to the internet and are now moving slowly towards 3rd party operators, who are being hired to outsource room reservation functions as well.
Over time, hotels employ different information systems to manage their client databases and all their outsourced functions. The bigger establishments employ sophisticated computer programs whilst small, independent establishments employ simple spreadsheets to project their occupancy rates etc to meet pre-determined key performance indicators.
The Internet as a form of “informal review”
Internet allows photos and lots of information to be posted to the website. As such, customers can better understand how the different types of rooms look like, where is the hotel located etc.. Websites such as tripadvisor.com and the many available forums are a good gauge as to how the hotel is faring in terms of service quality, room amenities, cleanliness of the room etc.
The internet is also increasingly being utilized to speed up room reservations in real time, so as to allow potential customers to view easily the information available and do the necessary booking and payment at the click of the mouse.
Increased use of Management Information System to manage data
A management information system (MIS) enables staff to better predict the hotel's room availability more accurately through real time information that is provided as and when it is needed and thus indicate the number of reservations to accept for any given arrival date and/or length of stay.
The MIS used by hotels also helps management to run real time simulation of the reservation system by collecting the historical reservation data and doing an actual simulation of the actual operation of the reservation system by running that data on a computer program. This enables reservation managers to test the impact of policy changes by altering a single component in the reservation system and asking "what if?" questions. This means that management can conduct reviews on whether marketing efforts have to be stepped up to increase the occupancy rate.
Because of increased competition, hotels have had to be able to forecast demand and supply of hotel rooms and this requires them to carry out detailed analysis. As such, MIS such as SABRE (semi automated business research environment), TravelSky, IMS Voyager enables management to control allotments of rooms, distribute confidential information such as trade rates, commissions, seasonal requirements, maximize revenue by ensuring high occupancy rate in real time, and many more functions.
The main objectives of linking a hotel's computerized reservation system to other systems in the room distribution channels are to make the reservation process more prompt and less expensive. First of all, data transmission is less expensive than verbal messages. Secondly, real-time confirmations reduce the need for follow-up calls. Thirdly, human error is less likely to occur. Fourthly, extremely accurate and detailed product information can be provided at the outset of the reservation.
The following are some of the main methods that hotels use to manage their reservations:
Nevertheless, there are two major limitations to the automated reservation system. Firstly, computers can have the effect of dehumanizing hotel services. Since hospitality is a personal service, few guests will be impressed if their first contact with a receptionist is with one whose eyes are glued to the terminal screen.
Secondly, sophisticated automations of a hotel's reservation system may cause difficulty in getting people from the reservation centre to participate, since they may resent the fact that computers have replaced most of their jobs. This may lead to intentional sabotage of the system that could cause millions of dollars in damages to the firm’s revenue and to the brand name that the hotel has so painstakingly built up.
Thirdly, there could be an issue of security problem in MIS. This is because information transmitted wirelessly could be hacked by competitors who want to steal confidential customer particulars and learn the inner workings of how their competitors operate.
As such, it is crucial that hotels ensure that the MIS is secure and only accessible to employees who need the relevant information.
Indeed, as we can see from the above, computers and the rise of the internet improves the management of data records, hasten the search process, verify and analyze data instantly, allow for easy payment etc. It gives customers a peace of mind knowing that they have already booked their rooms in advance and saves them the trouble of worrying as to where to find a hotel upon arriving in the airport.
Conclusion
There is no such thing as the perfect hotel booking process. Booking processes that are better aligned to the needs of different marketplaces and different groups are constantly in the works. Management could take note of websites where past travelers provide their feedback on hotel room reservation services of the hotel.
Notwithstanding, the hotel could also look into complaints received by their outsourced services such as 3rd party booking agencies like expedia.co.uk, complaintsboard, tripadvisor etc. It is important for hotels to be proactive and find ways to remedy/minimize the problem from reoccurring.
