Magoosh GRE

I.T and E Commerce of Hospitality Industry

| November 16, 2012

Introduction

Here is an attempt to understand and explain the information systems which are been used and how they are useful to the company and what are the drawbacks of those systems, and also how they can try to solve those problems. Hospitality Industry is a very fast growing industry. Every organisation wants to retain and also attract new customers. Information technology used by the hotel is very much important and plays a major role in providing a competitive edge over the competitors.

Information Technology Trends in Hospitality

Hotel Industry places a great emphasis on the provision of quality service to their customers/guest. There is a great demand for information from customers and hospitality service provider so hotel industry stared adopting computer based IT facilities to enhance its operational efficiency, control and reduce costs, and improve service quality (Camison, 2000; Cobanoglu et al., 2001; Siguaw and Enz, 1999; van Hoof et al., 1996).  By investing  in the IT benefits the hotel by enabling the guest to have a better experience, and also the hotel staff to work more efficiently and effectively to better assist customers.

Hospitality Organizations & the Internet

Many prime hospitality organizations such as IHG group, Marriott International, Royal Caribbean, Jurys Inn, Hyatt International, Ritz Carlton, Hilton Hotel are using internet facilities over the years and have been taking advantage of the Internet opportunity by fully implementing the latest technological systems within their organisations.

A new Internet-based procurement system which is considered flexible and user friendly has been implemented by IHG group.  According to the Vice President of purchasing, Steve Shamion, it is important that the system is user friendly for a chief engineer, chef, housekeeper, etc.  As soon as IHG succeeded 500 hotels, it was necessary to get rid of the manual system.  Their main aim was to provide a new Intranet system with a web-based provider.

The goal was to implement an Intranet system with a new web-based provider.  The e-mail system is currently functioning efficiently as it alerts purchasing agents to contact suppliers in every case where corporate revises a product.  The new system has enabled the IHG group for excellent quality control.  In this respect, IHG claims that they are able to obtain high quality products at low costs via the Internet.

Marriott Hotel and resort has chosen the same Internet provider for its new procurement system. They are analyzing the mechanics of the system as well as the concept of electronic purchasing and the advantages that could be realized by Hotel.  One of the key elements of this research involves the “user friendliness” of the system.  Another concern is the connection factor.  The system must be reliable in connecting without failure.  The content is another very important requirement.  The suppliers must be able to easily find products on the site.  As for the overall costs involved in the implementation of such a system, it is still unclear.  On a positive note, both IHG and Marriott believe that they will be able to quantify the new system’s effects right away.  By tracking every purchase over the web, this will allow them to record their progress.  In the long-term, as one of the first movers in the hospitality industry, the prediction is that the overall impact will be positive.

Leicester Marriott

Marriott’s operations can be grouped into the following five business segments:

Marriott operates under various different brand of hotel like

 Full Service Lodging

Select Service Lodging

Extended Stay Lodging

Timeshare

Leicester Marriott Hotel Overview

227 Bedrooms

Mixx Restaurant

Tanners Bar

Atrium Lounge

21 dedicated meeting rooms

Leisure Club facilities

Wireless LAN in public areas

Car park – 280 onsite spaces

Marriott International, Inc. is a leading global lodging company that shapes and enables its business through an ambitious program of improvements in technology.  In the beginning of late 1990s, Marriott realized that to be competitive  and lead the future lodging market, it had to upgrade and fully integrate two of its most crucial systems: the Marriott automated Reservation system for Hotel accommodations (MaRsHa) and Marriott’s Internet technology platform, Marriott.com.  These systems, combined with Marriott’s key business and inventory applications and marketing and loyalty programs, comprise a global technology infrastructure that facilitated more than 69.5 million new reservations in 2005, averaging over 190,000 per day, while maintaining availability of better than 99.99 percent.  The updated infrastructure enabled 100 percent growth in Marriott.com sales from 2003 to 2005, logged single-day sales records of nearly $14 million, and led the industry in online hotel room’s sales. In fact, Marriott’s seamless multi-brand, multi-channel integration enables the company to offer the industry’s only global rate guarantee, the Look No Further® Best Rate Guarantee, stating that Marriott guests will always get the lowest available rate when booking through any Marriott channel worldwide.  It is a remarkable success story, demonstrating how aligning investments in technology infrastructure with business vision and strategy can enable extraordinary business results and how Marriott leveraged its early investment in ecommerce to set new standards for the global lodging industry

Technologies used at Marriott Hotel

Company website

Point Of Sale-Micros

Property Management System-Opera

Central Reservation System-Marsha

SAP for accounting and Payroll

Fire Panel

Door locks

CCTV

Blue Cube -Time Clock (Employee attendance)

Cetral Reservation System

In today’s fast-paced environment, business travellers have enough to be concerned about, without worrying about hotel accommodations. And, it takes more than just hotel rooms to win in the highly competitive lodging business. Professionals want the latest technology at their fingertips, from fax machines to Internet services. Central Reservation System is used to connect to the different hotels of the same group. Currently at Marriott a software called MARSHA is used. MARSHA (Marriott’s Automated Reservation System for Hotel Accommodations), according to Rinaldi. “MARSHA allows guests to call in at any property and have a reservation agent allocate and book reservations,” he explains. “The Marriott Rewards System [a point-accumulation program to earn special savings] is also kept on this system so that guests can tabulate their points.” All major airlines and travel agencies link into MARSHA by T1 and 56-Kbps connections as well.

Micros-Opera

Micros-Opera is one of the famous providers of property based system in today’s hospitality industry. Its PMS interface has become a common one within the hotel industry and is used by many as a de facto standard.

Consequently, many software vendors use this interface because it makes it more likely that their software will be able to connect to other vendors’ applications.

Micros: MICROS 9700 HMS

It is the most widely used point-of-sale solution system in the leisure and entertainment marketplace. Built on years of industry experience, the entire 9700 HMS product suite is technology independent, running on MS SQL, Oracle, and Multiple Windows platforms. All 9700 HMS modules are web-delivered and enterprise enabled, making them easy to use while reducing total cost of ownership. 9700 HMS has proven installations ranging from small, specialized operations to large enterprise configurations spanning multiple properties in large geographic areas. Whether you operate one restaurant or hundreds, 9700 HMS has the functionality to meet your needs.

Problems with Micros

1)       When the systems crashes down then the checks has to be manually posted which is like duplication of work and time, there are even discrepancies sometimes and in that the company loses the revenue.

2)      If there is a crash, it needs to be done by the help of a main server computer. But if the problem prevails there is a need to contact the vendor for his service.

3)      The micros system sometimes get frozen which affect the overall performance of the server and the team.

Difficulty

Because Marriott involves representatives from every part of the company in all new initiatives from the very beginning, the company is spared many of the “growing pains” typically found when implementing large, global infrastructure projects.  The company’s business and marketing managers are technologically fluent and worked closely with the Information Resources and ecommerce departments throughout the process of upgrading and integrating the reservations system and Web presence.  There were, however, two key challenges Marriott faced in its MaRsHa and Marriott.com implementations: availability and scalability. Knowing that Marriott solutions have to be developed, implemented and rolled-out in a 24/7 global business environment, extra attention was paid to maintaining the reliability and availability of ongoing operations.  This was a critical factor in the MaRsHa upgrade, since the reservations system is literally the life’s blood of the company.  Marriott also upgraded both MaRsHa and Marriott.com with leading-edge scalability to support both current and future transaction volumes, and the systems have performed without data loss even as transactions have grown 400 percent over five years.  Marriott’s early commitment to high-performance processing, scalable storage and business continuity made the transition to an integrated reservations/Web solution error-free.Marriott also took great care in test and development before moving new functionality into the global production environment.  eMc’s advanced business continuity software supports the company’s robust testing capabilities, providing an up-to-date replicated copy of the MaRsHa production environment, which facilitates quality assurance, testing and development, without introducing any production performance degradation.  Marriott also creates business continuance volumes (BcVs) from the replicated production data, which are used by developers, for example, to test database applications without affecting either the production or main test systems.  The BcVs enable the creation of more robust development environments, better developer throughput, and the ability to go beyond normal functional testing to bring complex test environments to production and ultimately to market more quickly

 

Conclusions & Recommendations

Now is the time for hospitality companies to take advantage of the opportunities available in creating a new value added customized online travel shopping experience for customers.  The ultimate trend calls for something comparable to the shopping-bot.  For those who are not familiar with the shop-bot concept, it is meant exclusively for online clothing shoppers who prefer to have a personal agent.  Similar to the shop-bot, the future of the Internet in the travel industry will provide a travel bot who will play the hand-holding travel agent for those that require the most guidance in arranging their travel plans.   This travel bot will create a custom experience that suits the particular customer needs offering a range of services including hotel rooms, restaurant tables, airline seats, and rental cars.  The travel bot will provide advice and recommendations as currently found on GDSs.

It is important to take a look at how Internet technology will affect the future of the tourism industry.  Most IT tools are being utilized.  However, there is still much room for improvement in speed, reliability, and adaptation to new technologies.  It is crucial for companies to take advantage of the Internet before the competition.  A solid R&D function is one of the elements in this process.  It is pertinent to study the customers and their businesses by encouraging them to fill out a customer’s profile form on the web.

It is important to consider how technological drivers will influence changes.  Many traditional small and large players in the industry are having a difficult time adjusting to the changes involved in switching to a full IT based strategy.   This is mainly due to the extent to which the Internet changes how hospitality services and amenities are delivered.  It further alters the organizational structures within hospitality companies and modifies the interaction of the customer and service provider.

The hospitality & tourism internet future suggests a universal system where property management systems will eliminate the need for expensive on-site computer hardware/software.  The maintenance problems relating to breakdowns, backups, and upgrades will be resolved in an easy efficient manner.  The Internet will control all transactions involving credit card authorization, travel agent commissions, and point of sale transactions.  This will result in fewer problems, a decrease in staff and an increase in profits.  The typical hotel guest will have the option of selecting movies, games, software, shopping and information through voice communication and data/video, all available at a low cost.

Future success for hospitality & tourism companies depends upon their abilities to identify a target market and the strategic opportunities available for survival and growth.  If data is managed properly, the technology can assist hoteliers and restaurateurs in projecting the lifetime value of guests, creating increased loyalty, resulting in an increase in market share.  The process of mass production has never been accepted in the tourism industry; therefore customized services are a must for survival.  Today’s computer world allows for mass customization in pricing, location, and amenities to a more knowledge-based format.  In this case, marketing and IT departments must work closely toward a merger of core competencies.   The drive toward e-commerce success includes a plan to track surfing and consumption habits such as the buyers, payers, and the return visitors.  Independent consultants are available to provide this data efficiently and confidentially.

It is crucial for hospitality & tourism organizations to stay on top of the roles of the major online players that are posing a serious threat to the industry such as Travelocity, Priceline, Expedia, Yahoo, etc.  Their role in the future of hospitality & tourism marketing is crucial to the survival of Hoteliers.  Hospitality & tourism organizations might want to look into the potential of becoming one of the first movers to join the dot com craze.  The already established loyal customer base will allow hospitality & tourism organizations to have an upper-hand over general online threats.

The customized travel bot could provide the ultimate travel experience of a lifetime for customers in adding the most value, thus allowing first movers in the industry to gain an overall competitive advantage.

 

Bibliography

E-Commerce in Hospitality & Tourism. 2011. E-Commerce in Hospitality & Tourism. [ONLINE] Available at: http://gonzales.com.sg/techno.html. [Accessed 12 Feb 2011].

Marriott International’s Accommodating Network – Network Computing. 2011. Marriott International’s Accommodating Network – Network Computing. [ONLINE] Available at:http://www.networkcomputing.com/909/909centerfoldtext.html. [Accessed 21 Feb 2011]

Point of Sale Software Enterprise Information System. 2011. Point of Sale Software Enterprise Information System. [ONLINE] Available at: http://www.micros.com/. [Accessed 18 Feb 2011]

Technology Jargon Buster – 8/31/2005 – Caterer Search. 2011. Technology Jargon Buster – 8/31/2005-CatererSearch .[ONLINE]Available at

:http://www.caterersearch.com/Articles/2005/08/31/302345/Technology-Jargon-Buster.htm. [Accessed 12 Feb 2011]http://www.marriot.com/

Marriott Global Source. 2011. Marriott Global Source. [ONLINE] Available at:http://mgs.marriott.com/index.html. [Accessed 16 Feb 2011]

Tags: ,

Category: Free Essays, Information Technology