Have you ever turned on your lights using your phone or smart speaker? And did you stop to think—within the split second it took—what processes had to happen, and happen properly, to make it work?
Essentially, your device must recognize and authenticate your voice, which in turn must be translated into bits and bytes. Those bits then travel through a cellular signal to the cloud and from the cloud to the WiFi connected plug, telling it to turn on the lights. When the plug executes the request, it sends a confirmation back through the same path to your device to confirm the lights are indeed on. Even more amazing is that whether you are close to home or not—you could be anywhere—it still works!
Twenty years ago, this technology would have seemed to be science fiction, yet here we are, not even thinking about it as we go day in and day out interacting with our various smart devices. The examples are many, and those instances are growing. Beyond your smart cars and rideshare apps, you can even connect your pizza delivery app with a variety of smart devices to do a number of useful (or not so useful) things for you, like order a pizza when your mom calls.
It seems every day there is another useful “connection” being made to ensure our personal and professional lives run more smoothly and more productively. In fact, these connections have become so ubiquitous that many of us don’t even think about what it takes to make them possible.
The Intricacies of a Connected World
There is no doubt the world is becoming more and more connected—and so is the technology that makes it happen. Consumers expect to interact with and through phones, and not just with each other. We are also seamlessly connecting with our preferred brands. In fact, 81 percent of customers are willing to switch their loyalty to brands that offer a more personalized experience.
Of course, in order to make all this “magic” work, tight and seamless data integrations between any number of technologies are critical. In the hotel industry this has been the cause for a lot of frustration and friction. But today, the industry is rapidly adapting to this new reality.
Historically, integrations between hospitality tech providers were often cumbersome and costly. Over the years, the lack of integrations and poor support were often cited as key points of friction. Some vendors put up “integration moats.” This, in turn, made it difficult to connect with other vendors. It also took a long time to complete integrations, resulting in costly integration fees.
Luckily for our industry, and all tech partners, the winds are changing. Over the last few years, innovative technology providers have created faster, cheaper and easier integration capabilities.
Powered by APIs, cloud-based providers are setting a new standard for the industry and, as a result, are forcing legacy companies to quickly adopt their strategic playbook. As a result, we are approaching a new dawn.
An API-First Approach
The integration of technology systems starts with what are called application programming interfaces (APIs). Developers look to APIs to help them access the features and data within other systems. In many cases, since the property management system (PMS) sits at the center of the hotel tech stack, technology suppliers are often writing code to access information from this central system, not the least of which is the revenue management system (RMS.)
Let’s say you are an RMS provider. Typically, the most “data hungry” of all systems in hotels, RMS solutions not only use a staggering amount of data to determine the right forecast, inventory and pricing decisions, but that inbound data must also be extremely high in quality and accuracy. The automatic and analytically derived pricing decisions made by the RMS should reflect the true picture of what is going on at the hotel (or in the market).
In addition to the accurate data from a PMS, other data an RMS ingests might come from rate shopping, reputation, future-looking demand, or other data providers. Finally, once the pricing decisions are made—typically multiple times a day—the price by product, room type and length of stay for 365 days or more is sent to the PMS, central reservation system (CRS) and channel manager.
Just think about the connections required to accomplish this feat. PMS, RMS, rate shopping, reputation, future demand, CRS, and channel manager all must work in unison in order to sync pricing information accurately and continuously.
Until now, this has required cumbersome and tedious work to connect each of the providers, certify the quality of the data and ensure integration standards are met. Leading RMS providers are very aware of the responsibility this requires and the time it takes to ensure the system runs smoothly, because if they don’t the impact can be felt across the organization.
For instance, if you are a door lock provider and the data is not exchanged accurately, in the worst case a hotel will have a guest satisfaction problem, but the fallout is minimal and isolated. But if an RMS does not “see” an accurate picture of hotel demand and as a result sends the wrong rates to the distribution systems—or the connection with the channel manager “breaks”—in the worst case, a hotels’ business performance can be severely impacted. And that impact is significant and far reaching.
This is only a simple example of why leading RMS providers must spend a considerable amount of care (and time) to certify hundreds of integrations and ensure they are of the highest possible standard.
Connecting at the Speed of Light
As more and more tech providers adopt an API-first approach, the friction, frustration, and high cost of integrations will become a thing of the past. Instead, data will be easy to access and seamless to exchange—often in real-time.
Some of the largest hotel software providers are simplifying their approach to integrations. The time is coming where instead of having to integrate each of their products individually, one API will provide access to the entire set of data a hotel might want to make available to a software partner—across all systems provided by one company.
What was a dream in the past is quickly becoming the new reality. A reality where software companies are working together to streamline and accelerate the integration process. So, the next time you speak into your phone to turn on the lights in your house, from anywhere in the world, take a moment to consider the connections that make this a seamless experience. Then consider that there is no reason why we cannot efficiently and easily connect components of the hotel tech stack in the same way.
This future is not too far away and turning on the light of connectivity will enable a truly connected hotel tech ecosystem.
ABOUT THE AUTHOR
As IDeaS Chief Evangelist and Development Officer, Klaus Kohlmayr challenges strategic processes, stimulates thought-provoking conversations and reinvigorates the future of revenue management and pricing within the hospitality and travel industries. Klaus’ podcast “Unconstrained Conversations” was created for hoteliers and is the hospitality industry’s collaboration point for real-world stories and actionable advice.