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Rob Jones
Written by Rob Jones
June 05, 2018

How IT Leadership is Transforming the Hospitality Industry

In the increasingly tech-centric world of hospitality, the CIO role is becoming more important than ever. Today’s IT departments are no longer just cost centers. They are key sources of competitive advantage for forward-thinking organizations.

Strong IT leadership is critical to maximizing that advantage. CIOs need to move beyond a cost-cutting focus, and start emphasizing strategic value. In particular, CIOs should take the lead on evaluating new technology trends, and thinking about how they can be leveraged to the company’s benefit.

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Here are three key areas where IT leaders are transforming their organizations:

Proprietary mobile apps

With the rising importance of the mobile consumer, hospitality companies are developing new ways to engage with customers on smartphones and tablets. The organizations that do this successfully will enjoy much higher levels of customer engagement, especially with the booming millennial demographic.

One particularly effective way of doing this is to develop native, branded mobile apps. These apps can provide users with supplementary services and information that enrich the customer experience in some way.

One good example is Viceroy Hotel Group’s Viceroy Connect system, which was developed by CIO Peter Chambers’ team. This mobile app is installed on a secured Android device in hotel rooms, and acts as a truly “universal” remote control for the guest experience. It allows guests to order room service, text hotel employees, control the in-room lighting and TV, and much more.

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Quality apps like Viceroy Connect are not easy to develop, and require a good understanding of technology, customer needs and business goals. In other words, it’s exactly the kind of sophisticated initiative that is best led by a strategically-minded CIO.

Cloud-based services

Another major driver behind the rise of the strategic CIO is the emergence of cloud-based technology services.

In the past, IT departments had to make long-term investments into expensive infrastructure, which would then be expected to last them for a decade or more. This tended to limit IT’s strategic options over time, as the department slowly became bogged down by the accumulated weight of multiple legacy decisions.

Today, that is no longer the case. The cloud has enabled the delivery of “everything as a service” – even hardware. In the words of the Harvard Business Review, “IT is quickly becoming an integrated collection of intelligent services that are on demand, on the move, and on any device.” This empowers modern IT leaders to develop curated technology portfolios for their organization’s specific goals.

Chris Hewertson, CTO of hotel group GLH, has taken full advantage of the opportunity. By moving GLH’s fixed IT infrastructure to the cloud, Hewertson’s team has been able to manage all IT operations with a lean team of just 13 staff.

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Even more importantly, Hewertson has turned IT into a profit center for GLH. The team built an API layer that integrated with their property management system, which has since become a platform for their own proprietary digital services and products. For instance, one such service allows guests to view the various rooms available and choose the one they want to stay in.

This API layer has proven to be so powerful that other hotel groups wanted in. Hewertson’s team is currently in the process of commercializing these products for sale to other companies.

Big Data analytics

Companies today are logging an unprecedented amount of data about their customers. And the ones who can effectively leverage that data will be at a substantial advantage over the competition.

The catch is that big data analytics also requires deep technical expertise. There is simply too much data out there to process completely, so someone needs to implement a system for filtering and organizing that data. And those systems will have to be “opinionated”. That is, they must incorporate human judgement about what information is important and what is not.

As the highest-ranking technical officer in the company, the CIO is the perfect candidate for the job. They have both the technical fluency and strategic perspective to understand how such a system should be designed and implemented. It should be the CIO’s job to gather input from his non-technical C-suite counterparts, and educate them on how such a system can advance the organization’s goals.

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For example, Peter Chambers of Viceroy has developed a big data platform that aggregates data across all business lines, including rooms, F&B, retail and spa. The system predicts guest behavior by analyzing previous interactions across a number of digital devices, such as smartphones, TVs and laptops. According to Chambers, the system provides Viceroy with “a tremendous opportunity to innovate based more on fact and less on assumption.”

IT is a strategic business function

The growing significance of digital technology has led to a significant shift in the role of the IT department. What was previously a cost center has now become a potential source of important strategic advantage.

IT leaders should recognize this, and energetically communicate the value they can bring to the table. The ones that do will successfully elevate their IT organizations, and help their companies lead the charge into the digital age.

How easy is it for you to scale your technology platform to support this relatively new mandate for IT leadership? We’d like to hear your thoughts on this trend and how you're planning strategy around it. 

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