In its latest monthly news bulletin, the Dubai HFTP Research and Innovation Center at the Emirates Academy of Hospitality Management discussed the trendy topic of implementing business intelligence (BI) in hospitality.
The Dubai HFTP Research and Innovation Center at the Emirates Academy of Hospitality Management regularly publishes a news bulletin on the latest in hospitality trends. These bulletins can be found on PineappleSearch.
The Implementation of BI in Hospitality
Written by: Gustavo Miranda, research associate
Editor’s note: The following has been edited for HFTP Connect from the original, published format.
Most hospitality businesses today focus on having a competitive advantage in order to perform better than their competitors. As a result, BI as a tool has evolved.
According to Cody, Kreulen, Krishna and Spangler (2002), BI can be defined as “the environment that supports analysis of specific data from internal or external sources to provide insights and valuable information to further enable operating, tactical or strategic decisions.”
In today’s marketplace, the use of technical tools — ranging from Enterprise Resource Planning (ERP) systems to data mining and other decision-support systems — has paved the way to adopting an integrated approach in business, a pattern closely related to CRM strategies. ERP systems provide integration of all resources but fail to deliver clear analysis and reports since they are primarily based on transaction processing.
Conversely, BI focuses on reporting and analysis with emphasis on the discovery of new insights, which leads to transparent reporting and faster delivery of information. This directly aids in decision-making and ultimately, improved profitability (Coroba and Gavrila, 2019).
However, in today’s business environment in hospitality, where several companies rely on legacy systems and Excel is still the major software in use, it is critical that businesses focus on digital transformation. The leverage provided by increasingly available data, as well as the combination of CRM systems, reservations, marketing/sales, finance and revenue management departments, all require a final alignment of the data. Once combined, data is then used to define internal and external strategies that serve all departments.
Nonetheless, the perception of change is different than the actual implementation of change. Willingness to change requires actual action, revision of business processes and effort in terms of time and cost. This process must start with initiatives from top management so that adoption of the strategy is clear to all departments and becomes part of the culture to employees.
The alignment of company culture with individual perceptions helps with the adoption of necessary changes in a more timely fashion due to rational influence through communication, awareness and use of key influencers.
Some authors agree that controlling processes and conditions help achieve desired changes. Under these conditions are the individuals who promote change with their experience, position, perceptions and motivations, depending on their level of involvement in the process.
Likewise, the organization is responsible for monitoring the emotional reactions of the people in contact with the systems (Bartoli and Hermel, 2004; Wang and Paper, 2015).
In 2011, a study by Fetzner and Freitas show some of the issues faced by companies concerning the implementation of a BI tool. The tool itself allows for an improved process concerning decision-making, since it removes certain blocks that were previously present, allowing increased time and for the decision itself, now free from constraints.
However, the same study mentions that fear of job loss presents a barrier to adoption of these types of tools. Employees react negatively to these systems, even though a problem may not be directly related to the BI tool itself.
Likewise, the workforce may resist change. People are accustomed to performing duties a certain way and are not comfortable with alterations — even if it means less work.
For the industry to evolve today, and businesses as entities in particular, maintaining a competitive advantage is paramount. Therefore, the solution relies on the use of BI tools where adequate data is available. More than that, it also requires actual changes in the work previously done. Businesses cannot expect to benefit from partial digital transformation without changing the actual processes and previous work habits.
Most hospitality businesses today focus on having a competitive advantage, but that can only be achieved if management implements a culture of change.
List of References
- Bartoli, A. and Hermel, P. (2004) Managing change and innovation in IT implementation process. Journal of Manufacturing Technology Management, 15 (5), pp. 416-25. DOI: https://doi.org/10.1108/17410380410540417 [Accessed on: 20 December 2019]
- Cody, W. F., Kreulen, J. T., Krishna, V. and Spangler, W. S. (2002) The Integration of Business Intelligence and Knowledge Management. IBM Systems Journal, (41)4. Available from: https://ieeexplore.ieee.org/document/5386885 [Accessed on: 20 December 2019]
- Coroban, L. and Gavrila, A. A. (2019) Exploring the relations between business intelligence and the learning organization. Revista De Management Comparat International, 20(2), pp. 198-204. DOI: http://dx.doi.org/10.24818/RMCI.2019.2.198 [Accessed on: 23 December 2019]
- Fetzner, M. A. d. M. and Freitas, H. (2011). Business Intelligence (BI) implementation from the perspective of individual change. Journal of Information Systems and Technology Management, JISTEM, 8(1), pp. 25-50. DOI: 10.4301/S1807-17752011000100002 [Accessed on: 20 December 2019]
- Wang, B. and Paper, D. (2005). A case of an IT-enabled organizational change intervention: the missing pieces. Journal of Cases on Information Technology, 7(1), pp. 34-52 DOI: 10.4018/jcit.2005010103 [Accessed on: 18 December 2019]
Gustavo Miranda is a research associate for the Dubai HFTP Research and Innovation Center, overseen by the HFTP Foundation.
About the HFTP Foundation: The HFTP Foundation is the philanthropic arm of HFTP, assisting the association to secure nonprofit funding for hospitality and travel industry-related research, educational projects and scholarships. The HFTP Foundation oversees the three research centers – Americas, Asia and the Middle East.