As the industry recovers from the pandemic and the slowdown in travel that it brought, hoteliers are looking for ways to make up for lost revenues. And they are trying to do this while having difficulty filling the positions that will offer guests the same high level of service that they demand.
One way to solve many of these challenges is to upgrade to the latest technology and install the infrastructure to make it work properly.
In the most recent Hotel Business Hot Topics session, “Improve Your Assets: Increase ROI with the right technology infrastructure,” in partnership with Corning, panelists discussed the importance of technology, both guest-facing and back-of-house, and why making sure it is supported with the right infrastructure is essential.
Chip Rogers, president/CEO, American Hotel and Lodging Association (AHLA), served as moderator for a panel that included Larry Birnbaum, principal advisor, Xenios Group; Jessica Janis, practice leader, hospitality, Corning Optical Communications; Rado Ivanov, VP, global design, U.S. and Canada, Marriott International; and Shannon McCallum, VP, hotel operations, Resorts World Las Vegas.
Rogers opened the discussion by asking McCallum about how she approached technology when Resorts World, the first new hotel to open on the Las Vegas Strip in 11 years, was being planned.
“It was really important to take a look at the technology that was out there because when you’re starting fresh, you have the opportunity to look at all of the different technology out there in order to make a new, different and forward-looking experience,” she said. “Our goal was to put the best technology in this location so we could help to support all of our systems.”
She said the resort team had a strong focus on the infrastructure. “People are traveling now with multiple devices and if you can’t connect your WiFi, it can be the biggest guest dissatisfier.”
Poor WiFi can be the difference between having return guests and having them choose a different property next time they come to town.
Ivanov pointed to a study that found that 73% of guests are likely to return to a property that meets their technology needs. “This is huge,” he said. “When we are talking initial investment versus long-term, it’s not just something like, ‘Oh, I put so much technology in, and I see absolutely no impact on RevPAR or ADR.’ It goes the other way. It might not impact your daily rate per se, but it will bring your guests back, and that is where the value of the investment is.”
Not only are guests relying on that strong WiFi, but with so many of a hotel’s operating systems using it, poor signals and quality can literally disable operations at the entire property.
“As we have this convergence of front-of-house and back-of-house, there’s a whole bunch of operations applications that have to be run on the same network,” said Birnbaum. “We don’t want to build a separate network for them. What’s happened in a number of projects is, as we look at Voice over WiFi, location-based services for assets, people and safety and the Five-Star Promise for staff alert systems and things like that, this network is now performing at a higher level that just guest WiFi.”
Given all of the potential for problems when the WiFi is not up to par, Janis stressed the importance of spending the extra money upfront for the best infrastructure. “On the infrastructure side, we are really pushing the message that you want to push fiber all the way to the guestroom instead of stopping at the IT closet,” she said. “But when I give the message to owners, the first thing that comes to mind is ‘Wow, fiber is expensive.’ It might have been that way—you think of the white-glove treatment and you can’t bend it—but that’s not the case anymore.”
She said that, especially with new-builds, the cost is now on par with traditional switched infrastructure, but it brings a lot of benefits to the property. “You can look at [fiber]like a 30-year asset,” she said. “It takes up way less space from those IT closets. At Resorts World…the planned number of IT closets was in the hundreds. We were able to take it down to [approximately]24 or 26, which gave a ton of space back to the buildings. With that, you’ve also got efficiencies in energy… There’s a lot of things that go into taking fiber to the room that folks don’t think about.”
Birnbaum said that making that initial investment when it comes to technology will be a benefit in the long term because it can increase the resale value of the property. “Everybody has got an investment horizon and, at the end of the day, [owning hotels]is a real estate business as well, and real estate gets bought and sold,” he said. “If you put the right infrastructure in, it becomes part of the bones, even increasing the value of the real estate for the next owner to be able to say, ‘I am buying an asset that has an infrastructure that I do not have to invest in. It has already been made.’”
One of the benefits of fiber is that it can easily adapt to new technology. “You’re making your network flexible for the future [if]a new WiFi revision comes out or you order a new device that wasn’t planned when you did your design,” said Janis. “It’s ‘an unplug the old device and put in the new one.’ If you are adding, you’ve got the dark fiber there. It’s a small jumper and it makes it very easy… You’re not cutting open your walls anymore to rerun cable to bring in new applications.”
Resorts World made the decision to go entirely cashless, making the tech infrastructure even more important. “I don’t know if we would have been able to do that if fiber wasn’t an option just because we would need to have that architecture in place in order to roll it out,” said McCallum. “When we are talking about post-pandemic, we are talking about efficiencies and how we can create efficiencies in all areas of our business, and going cashless is absolutely one of those things.”
She said there are a lot of repetitive procedures that come with having cash. “From a business standpoint, going cashless is not only great for efficiencies in our business from the operation standpoint, but also for the guest as well,” she said. “They can charge to their room. They can use their credit card, but you don’t have to worry about getting the right change, etc. [It allows us] to really change that flow and put our energy and resources in the right place.”
But, she said, the infrastructure really needs to be strong. “If you are going to put all of your eggs in one basket and…[go]cashless, you can’t have your WiFi go down,” said the hotel operations VP. “You can’t have your payment systems go down because you don’t have enough bandwidth.”
The ability to add to the system is a major benefit with all of the operations the hotel has—from casino, theater and convention space to housekeeping and security. “We continue to look for ways to get efficient and a lot of times, that is adding technology to the existing architecture,” said McCallum.
Rogers also brought up the fact that technology can help the workforce better do their jobs and, in turn, help elevate the guest experience. “For the guest experience, this reliance on technology all the way through the system in a world where we have a smaller or at least a limited workforce—it’s absolutely critical,” he said. “I don’t know how you are making it if you are not upgrading to the best technology right now.”
“You have to really review all of your systems,” said McCallum. “I am not saying that hotels are perfect yet—we still have manual systems that we have to work with. But the goal is to continue to look for solutions that will help you to be more efficient in your workplace and then cut down the steps that employees need to do so that you can do your check-ins more quickly… Having that bandwidth on our infrastructure allows us to add additional technology that can make our service more seamless.”
She also said that technology has helped with staff culture. “I know that pulling culture into this is a bit of a stretch when we are talking about technology, but not so much, because technology is being used to now build culture, to communicate to your teams and become that place that people want to work because they feel more connected,” she said. “That is something we can’t overlook these days when you are being competitive in the work market to bring people to your property to become part of your team and keep them connected… Having that wide architecture that allows us to be able to stay connected, not only with our guests, but our employees, is a huge benefit.”
Marriott’s Ivanov brought up the fact that technology is good for the industry and that “the machines won’t take over,” he said. “…Technology is there not to replace people. It’s there to place people in the right place. You don’t want someone vacuuming a corridor if they can be downstairs interacting with guests, providing what they need and contributing to the actual experience versus being in the back of the house and dealing with tasks that nobody wants [to do].”
Rogers asked where a hotelier should start when it comes to figuring out what technology is best for their property.
“We only have so many dollars we can put in technology, and we only have so much space we can provide,” said Ivanov. “It comes down to the target demographics of the property… You have to know who your guest is and go from there… You will also have to go by the budget you have, but at the very minimum…the WiFi is a given. The WiFi has to work everywhere [from]the public areas to the room and everything else… It is about keeping that guest happy and having them stay longer or having them come back.”
