Hospitality India Conclave – Part 2 – Key Challenges Faced In Hospitality Industry From Business Strategy Perspective
Part 1 of this series can be read HERE. Hospitality India Conclave witnessed an interesting panel discussion for 60 minutes on the topic “Key challenges in hospitality industry from business strategy perspective”. The discussion was focused on IT as a strategy unit, IT enhancing guest experience, compliances in hotel, challenges faced in the industry and many more. Following are the panel members:
1. Prashanth Rao Aroor, CEO, Intellistay Hotels Pvt Ltd
2. Dr. Ananya Gandotra, Head – Technical Services Group, Corporate Projects, The Indian Hotels Company Limited
3. T. Shivdas, Head – Information Systems & Technology, Ginger Hotels (Roots Corporation Ltd)
Ravish Jhala, Head IT – The Oberoi Group; Co-Founder – Hospitech
We are presenting the panel discussion in a Q&A format. The questions were posted by Ravish to the panel members. Discussion by panel members below:
What are the challenges you see in hospitality industry?
By and large its an infrastructure industry, there should be involvement by government too. To get right kind of finances, institutes who fund the project has to recognize our industry. Technology team should be taken into account during the hotel construction stage itself. We can take advantage of technology by integrating various kinds of services, exploring IT and technology to short-cut project delivery times.
Is Marketing strategy very important?
Yes, it has huge role to play. Its very important to know in which market / area you are in. Once Marketing team gives the right report on the market/area, the budget and strategy automatically falls in place.
How IT is playing a role in guest experience?
Its not just the guest experience, but also how IT is used to reduce the energy consumption in the hotel – all these needs lot of consideration. IT also plays a big role in hotel design. [Note: Travopia's article on Guest Experience and Hotel Design]
How finance play a role in the hotel construction project?
The marketing team will tell us whether we need 200 or a 500 key hotel depending on many parameters – site, location etc and then the budget estimate happens. While all these are going on, the construction project will already be started. The IT budget allocated during the plan always shoots up.
Is IT a strategy function or support function?
It’s high time IT is considered as strategy function. There are 3 disruptive technologies identified by Gartner: Mobile, Social and Cloud computing – these are going to influence our business and personal life in lot many ways. Look at the demography of India – 40% of people are below 30 age and all are tech savvy, they use technology in their daily life. To cater to the tech-savvy market, IT should definitely be considered as a strategy function.
How IT plays a role in Ginger Hotels?
In Ginger, IT is aligned to business. Our Ginger model will be very successful when it scales up, it’s a number model. We adopted a ERP based solution when we started and we introduced a enterprise wide integrated services. There are no servers inside any of our 27 hotels. All technicalities are supported by a central location in Trivandrum. Even a hotel opening takes about 15 days only, in this 10 days goes in end user trainaing, otherwise it’s just 4 to 5 days to setup a new hotel.
How important is compliance?
Corporate governance and compliance will become a focus area if you want to be transparent – but only technology can achieve this. You cannot escape compliance. We got certified for our cabling and network. When corporate governance (IFRS, VAT) comes in place, compliance will fall in place.
Cabling is certified in Ginger hotels, who certified it and what certification is that?
We don’t own any hardware, so we don’t have to go through lot of hardware complainces. Our service provider is a global giant who ensures they are compliant, that inherently makes us compliant.
You have many hotel branches, which is the fastest hotel you built?
The one in Agra was the fastest hotel that we built, and we did it in 85 days. Global study says that it takes 48 months to build a hotel in India.
How IT is playing a role in hospitality industry?
We are in “business hotel” space. Problem with current industry is – there are 4 to 5 large players in the hotel IT systems space (POS, PMS), and majority are desktop based systems. This means that, at every branch we need a team to manage the systems. You should take the view that all branches of the hotel will operate from cloud right from day 1. But, there is no one size fits all.
Is human management a challenge?
We are recruiting people from airlines, restaurants, retail industries and train them in hospitality. Our industry is not rocket size, so its about the ‘attitude’ to serve customers than the delivery.
Stay tuned for 3 more articles in this series.
Author: Karthick Prabu