CitizenM Reaps Benefits of Outsourcing
Since launching its first hotel in the summer of 2008, the three-property citizenM Hotel Group (www.citizenm.com) has established a unique brand identify of affordable luxury that gives global mobile travelers what they most want and need. Its success is built upon offering guests a unique experience, as much as it is on maintaining low operating costs. In traditional hospitality concepts, combining the two would seem like trying to square the circle, as the further refinement of guest amenities would inevitably lead to higher costs. The smart use of contemporary technology, however, enables citizenM to run its hotels with a lean back-office, and to tune its operating cost to the effective delivery of the very best personalized guest experience.
Network standardization and application virtualization are twin factors for citizenM to streamline its operations while focusing entirely on its guests. IT outsourcing is central to this approach. Fundamentally, managing networks is a specialized activity, and citizenM believes that it is more effective to have specialized activities handled by those who know best.
In autumn 2009, citizenM turned to Swisscom (www.swisscom.ch) to advise on the most efficient use of technology for its Glasgow hotel project. Swisscom developed a technology blueprint for citizenM where the widest number of hotel and guest services would be converged into one unified network infrastructure. From a catalog of IP-compliant technologies, citizenM chose its preferred service providers for its PBX system, room lighting and HVAC, while IPTV and HSIA services were sourced from Swisscom directly. Swisscom coordinated the interfaces among all the vendors concerned, which included NEC (www.nec.com) for VoIP and Philips (www.philips.com) for the mood pads in the guestroom, among others, and managed the deployment.
Today all these systems run on the same, integrated wired and wireless network infrastructure. Through their shared IP platform, the systems “talk to one another” and share guest data, hence enabling a high level of service personalization. citizenM’s IP network is remotely managed 24/7 through Swisscom’s specialized network operations resources according to mutually agreed upon service levels. Swisscom handles and escalates vendor-specific incidents and coordinates the service delivery. There is actually no need for citizenM to have any specialized IT staff on site.
Application virtualization also plays a big part in citizenM’s forward-looking IT strategy. Together with Swisscom, the hotel managed to drastically reduce the number of on-site servers and systems. Its VoIP solution, as well as its central hotel system, which encompasses traditional (central) reservations, property management and CRM (provided by the Austrian company Hetras; www.hetras.com), have been entirely moved into the cloud. This enables citizenM to avoid on-site system maintenance and support. This software-based approach allows citizenM to benefit from flexible, pay-per-use pricing. As a result, citizenM saves on acquisition, installation and maintenance, not to mention energy consumption. Moreover, through Hetras’ virtualized suite of hospitality management applications, citizenM now has a single database for all guest profiles and certain applications to service its guests in a consistent and personalized manner. For instance, it stores guests’ music choices and room ambiance settings, and then proposes them to the guest the next time he/she reserves a room on our website, or checks in at citizenM.
An undeniable advantage of a software-based approach is the fact that all future citizenM hotels can hook up to centrally-hosted data and applications while avoiding the costs associated with additional set ups. citizenM has two New York City properties in various stages of development that will open in 2012, as well as two sites in London, one of which will be ready in time for the 2012 Olympics. By choosing the same application providers for its new properties, citizenM can effectively create a ‘template’ for its hotel IT. It would include all the applications that citizenM needs, with fully integrated systems and defined interfaces. Deployment could be optimized accordingly. And for the network manager, it appears to be a matter of scaling its existing processes and operations.