Impact of Technology on Travel and Hospitality Sector

By Bhanu Chopra, Founder & CEO, RateGain

Today, technology is advancing at a rap­id pace which none could ever imagine. Even micro-enter­prises and start-ups are pro-actively using technology to help them catapult into new mar­kets with new growth opportunities. Though technology plays an integral role in strategic decision-making, the hospitality industry has only been able to utilize the technology superficially and has not been able to integrate its functions with other business opera­tions of the hospitality. However, the adoption of technology in hospitali­ty has been comparatively slow. The hospitality sectors have been less en­thusiastic about the technology and the tools, but now, gradually waking up to the benefits which technology can bring, the industry is gradually agreeing to the fact that, when the right technology tools are applied correctly, then a Revenue Manager can achieve visible revenue benefits and is empowered to stimulate the growth of the company in line with the market evolution.

A study by the Institute of Char­tered Accountants of England and Wales (ICAEW) testified that almost 80 percent of companies believed that technology plays an indispens­able part in their plans for growth, helping businesses to up their game and to reach larger audiences.

In a competitive business setting, organizations are majorly looking at two things: Revenue Enhance­ment and Cost Reduction. These two factors together build winning businesses. Organizations take differ­ent approaches to achieve these two goals. However, one thing consistent in any business strategy today is the use of Information Technology. IT comprehensively includes all types of technology used to exchange, store, and use or create information. Infor­mation Technology is a fundamental requirement of most modern busi­ness operations in any industry.

Among many other revenue relat­ed benefits, the way IT has improved organizational and business commu­nication is amazing. The electronic based communication system used to disseminate routine and critical business information in a quick and efficient manner which has increased the productivity of businesses many folds, by allowing better business de­cision-making and eases an organiza­tion’s expansion into new territories or countries.

Information Technology systems have greatly helped companies to au­tomate their routine tasks by making data analysis easier and store data in a manner to retrieve it easily for future use. Coming from an In­dustry that serves Hospitality and Travel Technology needs, the use of IT and IT tools in this indus­try has helped businesses to reach a new level altogether. The com­plete operations of hotels and rev­enue management are run on tech­nological tools which are capable of handling a myriad of things like De­mand Forecasting, Rate Shopping, Price Optimization, Online Invento­ry Distribution, Guest Feedback or Online Reputation Management, etc.

Companies are increasingly using IT as a first-mover strategy to create new products and services, differen­tiate their products from the existing market or enhance their customer services. IT has not only helped orga­nizations follow a low-cost product strategy to reduce their costs through increased productivity, but also elim­inated the need for employee over­head. Businesses are continuously innovating to build an information technology to their products that make it hard for customers to switch platforms or products.

With the increasing importance of the role of websites in hospitality, the channel no longer only serves as a platform for sharing information and facilitating transactions between cus­tomers and hotel companies – it also enhances service quality. Hotel com­panies are attracting a lot of direct business through their brand web­site. Social media is another effective way to build stronger relationships with customers, while also making a positive impact on the prospects.

Another major technological de­velopment that has benefitted hos­pitality industry is the increased use of mobile technology. Various re­searches have estimated that there will be more people accessing the Internet through smartphones, than through desktop computers. That is a substantial fact, both for you as a mobile phone user, and for your customers, who will be visiting your site for business. Making your web­site mobile friendly is one thing all businesses should consider including travel and hospitality.

However, it is inevitable that some hotel practitioners fail to ap­preciate the benefits of technology and its applications, as the hospital­ity industry is customer-oriented and service-oriented. Some managers do not have adequate knowledge of technology and thus do not rely on their applications to business practic­es and daily operations. Many more such Revenue Managers feel that their priority should be on maintain­ing an alluring property and good guest relationships. Of course, these are profoundly important, but both guest charm and good service in­creasingly rely on technology, and failing to keep up with latest in technology must inevitably lead to a fall in ratings.

In order to remain competi­tive in the current business envi­ronment, hospitality managers have to understand the potential advantages of technology applications, and devote their time and effort to taking advantage of new technologies and tools.

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