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We must put digital transformation in a perspective.
Digital transformation is nothing new. The true digital transformation process started in 2010 with the digitization of analog and manual processes.
Digital transformation is a cross-department effort to reimagine the way hotels use their people, processes, digital programs, and devices to drive new business and revenue in light of changing customer expectations.
Around 2014 we started to see the impact of digital transformation where brands started to switch to a technology-first approach.
In 2016 there was a push toward digital transformation becoming a never-ending quest for improvements. As a result of this many brands started to upskill their team and implement more agile strategies.
And in 2017 several brands started to work on closing the experience gap between web, mobile apps, and offline engagement.
2018 was an important year for digital transformation as it started to become a key driver for growth for many brands.
Several key projects were now developed in data lakes; a platform formed from mobile technology, social media, cloud computing, big data, and IoT devices.
HOTELS AND THE DIGITAL TRANSFORMATION DILEMMA
As a result of the COVID-19 pandemic, the prevalence of payments, AI, chatbots, and other digital technology digitization was embedded into everyday life at warp speed.
A report from McKinsey that was written before the COVID-19 pandemic hit found that a large percentage of digital transformations failed.
The reason behind this was that there was a huge disconnect between any brand’s legacy business activities while reaping the benefits from the digital transformation processes.
To understand this digital transformation dilemma we have to look at WHY this happened.
For most hotels, digital data has been stored in data silos. A data silo is a set of data that is controlled by one department and isolated from the rest of the organization. And data in data silos is stored in a standalone system that is incompatible with other data sets in the organization.
Hotels like most brands had good intentions with introducing digital transformation.
Seeking to boost productivity, efficiency, and profit, many hotels were seeking to implement digital transformation frameworks. Some projects involved sweeping changes that included the automation of previously manual tasks, while others set out to replace older technology with newer, updated systems.
Despite these great intentions many hotels and brands failed.
The mistake hotels and many brands made was to look at digital transformation as a one-dimensional process. Technology was set out to be the differentiator that was going to solve all the problems.
The problem with this one-dimensional approach was that it triggered fears, uncertainty, and doubts.
As a result of this, there was a lot of resistance to digital transformations. Both leaders and employees preferred the status quo. Another problem was this one-dimensional approach was set out to work for the customers, not with the customer. This resulted in no clear end-user experiences.
Successful digital transformation frameworks are built around data. Data silos became a bottleneck for distributing data to the right places. Many leaders were not transparent in the onboarding process of digital transformation. And there was no ownership or accountability.
Many hotels started implementing digital transformation frameworks into already broken systems. And one major challenge for many hotels was the lack of proper skills.
HOW TO FIX THE DIGITAL TRANSFORMATION DILEMMA
Let’s be clear digital transformation is a multi-dimensional process that builds on value innovation and flexibility.
You have to start with the people transformation first!
It will require reskilling, upskilling, and identifying new skills. Digital transformation frameworks are all about learning and helping to learn. Hotel leader together with employees has to lay out why they should transform and then lay out a strategy for how to act.
The main point is that you need to start with the core of your hotel business first, while parallel is setting up new digital transformation frameworks. When you get people and technology to work in harmony you enable your hotel to tap new market segments.
Once your hotel achieves this harmony then you are in a unique position to create new experience offers that meet new demands.
Start implementing a flexible structure for your hotel’s operations. Use technology as a driver for transformation. Implement a digital transformation framework that combines these processes.
With a people-first approach, you set out an important foundation for a mindset change. And with ongoing reskilling, upskilling, and seeking new skills you will have the right talent in place.
When your hotel adopts a more agile collaboration to execute digital transformation frameworks and implement employees from the start you will ensure ownership and support. Then together take appropriate steps towards implementing data lakes.
Today data lakes are a new and smarter approach to managing and supporting information like real-time data by storing all pieces of information in one single interface.
The success of data lakes lies in the knowledge of actionable data to achieve the desired outcome for hotels, and access to the right data to achieve this outcome.
Over to you
The hotel industry is always changing, especially during a time of crisis. Make sure to future-proof your business and continue attracting new guests by investing in these solutions.
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About Are Morch
Are Morch assist hotels ? in increasing their direct bookings through innovative digital transformation solutions, while avoiding competition with online travel agencies.