What You Need to Know About Running Hotels in the Cloud
With the exception of the POS, hotels plan to operate all major systems in the cloud by year-end. This is according to data from Hospitality Technology’s 2018 Lodging Technology Study. Moving systems above property is having an impact on how hotels operate by helping to cut IT costs and allow workforce access to data from any place at any time. In this roundtable, executives discuss the transformative power the cloud has had on hotel management and what operators must take into consideration.
PANEL:
Mike Uwe Dickersbach, Director of IT Capital, HEI Hotels
Douglas Rice, Managing Director, Hospitality Technology Network, LLC
Michael Schubach, CHTP, CHAE, Strategic Deployments and Program Management Director, Infor
How can cloud-based systems help hotels stay flexible and scale technology rollouts quickly?
MIKE DICKERSBACH: The model for a new hotel used to be, buy hardware, configure hardware, deploy hardware, install software, and spend countless hours getting interfaces to work. The cloud model has changed that to some degree. From an enterprise perspective, you want to be nimble, and you need to be able to make miracles happen, sometimes overnight. With cloud-based systems, speaking from a hotel takeover perspective, you could accomplish that. Don’t get me wrong, without the proper lead time to build out the system and configure it, it may not be exactly how it is needed at the hotel level, but it would be manageable. Yes, you still need hardware, yes you still need some sort of operating system on that hardware, but the days are mostly gone for dealing with all the nuances you had on a client-server based system. If you have an internet browser, you have your cloud-based system, but not all cloud-based systems are alike. In order to be the most nimble, you would actually want a system that was built on the cloud, and not a client-server system that was forklifted into the cloud and thus requires additional technologies and software to access it. Enterprises benefit the most allowing for a central management platform, precision control across all assets, and the ability for team members dedicated to a platform to work anywhere with internet access.
MICHAEL SCHUBACH: With competition and market pressure escalating, it is more important than ever to have efficient, scalable technology that’s up to the challenge. Finding a way to modernize your business quickly, simply, and cost-effectively hasn’t historically been an easy thing to do. However, applications hosted in the cloud are changing that. Cloud applications offer a lower total cost of ownership, require less manual upkeep, and improve visibility and access to actionable data across the enterprise. Opting to deploy solutions in the cloud also means faster implementations, and a quicker time to value, leading to heighted productivity and, eventually, increased profits.
DOUGLAS RICE: Systems built for the cloud – as opposed to legacy systems (including those that are centrally hosted and accessed remotely, which some vendors misleadingly call “cloud”) – can scale on the fly by simply adding more virtual servers. That’s assuming they’re properly designed. Cloud architectures are inherently scalable, but poorly designed cloud-based software may still fail at high volumes.
What should hoteliers consider with Internet of Things (IoT) and how cloud-based services help in connected environments?
DICKERSBACH: IoT is here, it’s been here, and will continue to grow. Though still in its infancy of what is to come, the biggest question to ask here is how secure is the device I am looking to deploy? As IoT devices continue to come around, you will have additional hurdles outside of security. One of them will be keeping track and inventory of these items. How will they connect to the network, who will support them if they are connected to your HSIA system? You don’t want to get into the blame game between multiple vendors when things stop working. A solid architecture, like most things, is required to fully understand how new devices will impact the network. You can’t simply say, “Hey that’s cool, let’s do it!” without planning all the data flows and security around it.
SCHUBACH: We are starting to see that the era of the IoT is rapidly advancing and evolving into the era of Artificial Intelligence (AI), and the evolution of consumer expectation is tracking right along with the technology. Viewed through this lens, it’s critical for hoteliers investing in guest-facing technology to recognize that guests not only expect to connect to amenities via personal devices, they expect that preferences and recommendations based on those preferences be presented back to them at every point of interaction throughout their stay, and to be recalled during future stays. Legacy operations systems, whether on-premise or “hosted in a cloud environment”, do not have the technology architecture to support this cycle of service. Without the data collection and security, ease of integration, and data analytics offered by operations systems built on true cloud architecture, continued investment in guest facing technology will never meet the vision of the connected IoT experience.
What role does mobility play when considering cloud strategies?
SCHUBACH: The benefits for hoteliers of moving business applications to the cloud are numerous. One often overlooked perk of cloud applications is the increase in mobility it provides. Mobile access capabilities allow staff to share information, resolve issues, and serve guests — from anywhere. This connectivity and access to real-time data eventually even impacts the guest, and can ultimately lead to better experiences. Having the option for mobility also means that hoteliers can connect to guests in non-traditional ways to increase their satisfaction and better meet or anticipate their needs.
What are some key ways cloud systems can have an impact on management? Are there any key ways efficiency and improved operations are tied to cloud-based systems?
DICKERSBACH: The easiest take away here is mobility in the workforce. Not just from an IT perspective, but from anyone that works on any level. From revenue management, to sales, down to the programming level. If people have access to the internet, they can work. As with all things, this requires a degree of culture and abilities on both the company and the work force.
RICE: For many systems, cloud can eliminate the need for hotel premise-based hardware, without restricting functionality or performance; this reduces hardware and support costs and simplifies routine maintenance and software upgrades. Secondly, whereas legacy systems must have hardware sized for maximum load, cloud-based systems can simply rent more hardware just for peak periods.
How should hoteliers consider using the cloud to store and pull customer data to customize experiences?
DICKERSBACH: Ultimately, we will see interfaces shift from serial cables, or even local IP to b2b. Cloud to cloud interfaces, as we are starting to see, will really become the mainstay of being able to collaborate and customize your customers data. Security and privacy will need to be addressed on how the data is accessed, what it contains, where it goes, and then if the customer has allowed the use of their data. Ultimately, it’s the customer that will decide on how they experience your product but we have to be prepared to provide that experience.
Speaking of security, how can those concerns be eradicated with cloud-based best practices?
SCHUBACH: Hoteliers should prioritize vendor selection and become educated about best practices for network safety. Selecting the right technology provider who employs these practices and is transparent on how and where data will be stored is critical in minimizing any risks associated with utilizing cloud technology. Ensuring security in the cloud is a two-part endeavor. Hoteliers must establish internal processes to safely acquire and transfer data, as well as the development and proper training of staff. The vendor must take measures to assess potential threats and implement effective security controls within the software.
A comprehensive understanding of a software vendor’s security approach is essential to verify that a company has the expertise to minimize risk and the capability to deliver the necessary protocols. This strategy should include a multiple layer strategy, as well as physical and operational processes that support protection. Knowing what type of monitoring processes and infrastructure-related measures will be taken to minimize safety risks is essential when running business applications in the cloud.
RICE: Cloud services operated by major providers such as Amazon, Microsoft, or IBM have built-in security and monitoring far better than most hotels. You simply don’t hear of big breaches of these platforms. However, hotels must still be cognizant of the fact that these companies control the security OF the cloud, not of the software running IN the cloud. In many cases, however, the cloud environment can reduce the vulnerabilities to which software may be exposed.
