The hospitality industry has gained a lot of recognition from all over the world in the recent past. Unlike in the ancient times when customer satisfaction was of less importance, nowadays every organization seeks to satisfy its customers in order to retain them as well as attract new customers given the high rates of competition in the market.
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The hospitality industry is very diverse including features such as hotels, restaurants, cruise ships, and health spas among other activities that play the role of helping people unwind during leisure. Given the high demand for the aforementioned services as well as the increasing number of businesses offering the services, most organizations have opted for the application of information technology in the hospitality sector just like in other sectors (Nyheim et al., 2005).
This paper is therefore an in-depth analysis of the application of IT in the hospitality sector. Focus will be on the reservation processes in a hotel.
The application of Hospitality IT
The hospitality industry just like any other business sector encompasses four main business functions, which include operations, marketing, human resources, and accounting functions. In all the four business functions, information technology is applied in order to facilitate the transactions and interactions of the hospitality industry especially in hotels (Tesone, 2006).
In most of the hotels, marketing is normally the key business function as hotels seek ways to make their products and services known to the public. Information technology comes in by the use of electronic marketing also known as e marketing whereby advertisements and promotions by the hotels are made through the internet.
For instance, a person who wants to go on holiday in a country of their choice could find details of the desired services by searching various hotels from the internet (Tesone, 2006). Upon their selection, booking and placements could also be made online.
On the other hand, business operations of a hotel could also be achieved through the application of information technology whereby orders and supply of the hotel are made through electronic means. For instance, vendors of a hotel could transact with hotel electronically such that purchase, service orders, invoices, and cheques are transferred electronically without physical meeting of the parties involved.
The accounting function of hotels could also be carried out using information technology whereby accounting services such as banking, payroll, preparation of financial statements and other financial transactions are done electronically (Cline & Louis, 1998, p. 11). This allows customers to make their payments online and get proof of payment by receiving receipts online.
In addition, the human resource business function also requires in application of information technology given its diverse functionality. Through information technology, hotels are able to fill up vacant positions by advertising them on the internet and getting applications from which they select the best candidates.
Information technology also makes it easy to communicate with workers of the hotels especially those that are in far distant locations. Employee benefits programs can also be carried out electronically for faster achievements of the desired objectives.
Integration of hospitality IT
Reservation is one of the main processes commonly carried out in hotels. For reservation to be effectively implemented, information technology ought to be incorporated. The reservation of hotel rooms is therefore carried out through electronic applications thus ensuring faster allotment of rooms as well as the ability to fast track the non-reserved rooms of a hotel.
The application of information systems in the reservation processes helps in the achievement of the goals and objectives of the aforementioned four main business functions of any industry. For instance, it helps in proper assignment of duties for the workers whereby once a customer upon signing out of the hotel leaves a room vacant, the human resource department quickly alerts the housekeeping staffs who go ahead and maintain the room making it available for the next customer.
This helps in property management because all rooms are appropriately used as expected thus making the hotel make maximum profits. Additionally, information technology applications also make it possible for the hotel management identify any customers who have overstayed in the rooms thus penalizing them on the extended period.
For proper integration of the hospitality IT application in hotels, it is advisable that the hotel management adopts a Central Reservation System (CRS), which is web based thus providing unlimited global access. There are various types of CRSs applicable in hotels, which are easy to implement and require less hardware.
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Upon integration into the hotel industry, CRSs play significant roles of marketing the hotel globally as well as making it easy for customers to make reservation in hotels without physically being in the hotel.
Competitive advantages of integration
Listed below are some of the competitive advantages that hotel get upon integration of information technology in their systems.
- They will be connected to Global Distribution Systems (GDS) and call centres for reservation.
- They will be able to expose their rates and inventory to travellers via distribution channels.
- Ability to get the actual hotel revenue because of seamless integration with other property systems (Crichton & David, 1995, p.16).
Internal property management systems versus external global distribution systems
The internal property management system is the software that is used in the operations of businesses in the hospitality industry especially hotels. They are characterized by the fact that they are web-based and most of the applications are online. Internal property management system play significant roles in minimizing operation cots thus increasing hotel revenue while at the same time ensuring quality services to the customers.
In addition to this, internal property management system has the capability of consolidation several software thus achieving multiple operations in one system. An external global distribution system on the other hand is software that is operated outside the hotel operations. It is the link of the hotel operations to the outside world. Through GDS, customers are able to identify the services and products of various hotels in a certain regions and be able to select according to their needs.
Unlike the internal property management, GDS has a larger audience since the hotel advertisements are made globally through internet. GDS is also cost-effective hence reducing the hotel expenses thus higher revenue achieved. However, unlike the internal property management system, GDS is specific to single software and thus not able to consolidate multiple software.
From the above discussion, it is evident that information technology plays a significant role in the hospitality industry. As seen in the application of reservation purposes in hotels, information technology makes operations easy and faster in hotels. Its integration in hospitality systems is the best action that hotels could take in order to gain competitive advantage in the global market.
Cline, S., & Louis, A. (1998). Creating enterprise value around the customer… Leveraging the customer asset in today’s hospitality industry. Arthur Andersen Hospitality and Leisure Executive Report 5(1), 2–11.
Crichton, E., & David, E. (1995). Managing complexity for competitive advantage: An IT perspective. International Journal of Contemporary Hospitality Management, 7(2), 12–18.
Nyheim, P. et al. (2005). Technology strategies for the hospitality industry. Upper Saddle River, NJ: Prentice Hall.
Tesone, D. (2006). Hospitality information systems and e-commerce. Hoboken, NJ: Wiley & Sons.