Push For Connectivity
Property management systems sprint toward full integration.
By Derek Gale, Associate Editor -- HOTELS Magazine, 1/1/2005
Integration. Interaction. Interface. These words are the keys to the future of property management systems (PMSs).
“The big push in the industry is for property management systems with greater connectivity, including better tools for distribution management and control over rate distribution,” says Jon Inge, a consultant specializing in property-level technology.
Andrew Sanders, U.S. director of sales and marketing at UK-based PMS vendor Ramesys, agrees. “Everyone wants greater integration for all the old-fashioned reasons: improved control and potential for profit plus enhanced customer care.”
Technology creates options for hoteliers, namely the ability to simplify operations and better their bottom lines. Part of that includes reducing costs, one factor helping to drive another industry trend.
“I think the other big thing going on is probably a very thin footprint to be ASP-like so you can run your application in a hosted environment or offer it over the Web,” says Dan Hogan, vice president and general manager at Galaxy Hotel Systems, Orange County, Calif. “... A browser-based interface is easier to use ... it will help save in training time and money.”
What works for individual properties and chains will differ based on needs and wants, which is why many vendors tout their systems’ flexibility, offering customization and components that may be easily added or subtracted so as to work with various types of clients. One thing is clear: As hoteliers become more demanding of property management software, integration will increase and new products’ capabilities will be nearly endless.
Vendors already note that it’s not just about being a property management system anymore—instead, there’s a total enterprise view to the new offerings.
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Multi-Property Systems
Vintage Inns, a four-property hotel group in Niagara-on-the-Lake,
Ontario, Canada, installed Northwind’s Maestro platform suite—a fully integrated software
package linking the property management systems with sales and catering, spa
services, and GDS—about two years ago. A centralized setup
with the server on site at one property, a single, common guest
database is shared across all hotels.
Maestro allows Vintage to cross-sell its four properties without fear of overselling because the room availability database is real-time and always current. An integrated yield management system maximizes and coordinates the rates at all hotels and optimizes rates over the direct GDS interface so they are uniform on all sales channels, including the Internet. “We have seen (a revenue) increase with the introduction of Maestro, as we have increased our presence in the marketplace,” says Lisa Jane Wheaton, revenue and sales operations manager for Vintage. “Before, we weren’t seamlessly connected to GDS systems.”
The company cites the multi-property functionality of the Maestro suite, from yield management, call center and centralized sales perspectives. “It’s very quick, simple and agile,” Wheaton says. “We are able to sell and see all properties in a fast manner—its multiproperty capabilities are amazing.”
Wheaton says that in terms of return on investment, “we’re definitely experiencing a positive ROI through increased GDS presence and the functionalities that come through those systems, with last-minute room availability.”
ASP Model Gaining Steam
Northwind also offers an application service provider model
(ASP), where property management software and data is accessed
via a browser. The advantage to a Web-based property management
system is that hotels do not need an IT person on site
to handle the system, resulting in a great cost savings.
Under Northwind’s
model, clients pay a monthly fee. Other PMS vendors, including Ramesys, Galaxy
and Micros, also offer ASP models.
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“Certainly I think that’s a hot trend,” says Robert Grimes, chairman of Gaithersburg, Maryland-based Accuvia. “Central reservation systems have been ASP-based for the past 20 years, so it’s only natural for PMS systems to go that way.”
Boscolo Hotels, Padova, Italy, in 2003 decided to use a remotely hosted version of Micros’ fully integrated Opera Enterprise Solution for its 16 properties throughout Europe. Boscolo’s Web-enabled, thin client database runs from a Micros data center.
Having a single external data center that manages the entire group has allowed the company to significantly reduce investments in information technology, Boscolo officials say, as the setup allows for outsourcing all hardware, operating system and database management.
Benefits Of Centralization
Hotel Information Systems also offers multiproperty integrated
systems, and Kimpton Hotels in June selected HIS’ epitome
enterprise and property management systems for implementation
across its 39 properties.
Kimpton expects to see a return on investment once full implementation is complete, which is likely in about 18 months, according to Andrew Furrer, director of information technology.
Furrer notes the ease with which Kimpton can roll out new properties with the epitome systems, thanks to centralization (the systems will be maintained in the company’s data center in Oregon). “Technicians can do the rollout remotely via a secure connection,” he says, without a need to visit the central location.
Perhaps the most important benefit of centralization, Furrer says, is that it keeps him from having to hire additional IT managers. “We get more bang for our buck,” he says.
The Expedia Factor
As potential guests flock to online travel agents
such as Expedia and Hotels.com to find a place to
stay, hoteliers are looking to property management
systems not only to work directly with such agents
to receive and process reservations, but also to
manage rates and availability.
Phoenix-based Multi-Systems Inc. is working with Expedia to design a two-way interface between MSI’s WinPM property management system and Expedia’s direct connect technology. The program is slated for rollout this quarter.
“There is a multifunctional aspect of this agreement that is about more than just receiving reservations from Expedia,” says Mark Houser, MSI’s chief operating officer. “Of course, this can lessen the expense to the hotel and bypasses a fax notification and feeds directly into the property management system. But the real technology comes into play through working with their property management system and updating Expedia with availability, rate updates and inventory restrictions automatically.”
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The system will eliminate the need for an allocation method for global distribution sites—with staff having to constantly monitor available rooms and rates—resulting in a labor savings that is “quite a value to properties,” Houser says.
Ramesys also has a partnership with Expedia to give customers seamless connectivity, and Mandarin Oriental Hotel Group, Hong Kong, has partnered with Stowe, Vermont-based Springer-Miller Systems to develop a direct interface with Expedia as well.
It’s How You Use
It
Most hotels and hotel companies can have the same property
management system as their competitors—it
matters little, consultant Inge says. The way
to competitive advantage, he says, is knowing
the right questions to ask of the system.
For those who may not know what to ask, both Northwind and HIS offer analytical tools with pre-built queries and data sorting capabilities, so that customers can take responsibility for data and use it to make decisions without having to bring in an outside firm.
Both Vintage Inns and Kimpton opted to purchase these business intelligence components, and both are pleased with what the software can do.
“If you wanted to know the number of guests who stayed with dogs, Maestro can break (the data) into that detail for sure,” Vintage’s Wheaton says.
A Look Ahead
So what does the future hold for property
management systems? “I think
it will continue to revolve around the guest,” says Warren Dehan, president
of Northwind’s U.S. operations. “It
will be up to PMSs to help hotels make
sure guests that have come or may come
(to a property) are communicated with
in the right way. There will be pressure
put on PMSs to take that CRM one step
further.”
Dehan says this could include video recognition or better communication to cell phones or PDAs.
Grimes believes there is a change in thinking happening: Hotels now are focused on revenue enhancement—getting more money out of the guests. The theory, he says, is that the person who spends more is happier, because that person receives more services, resulting in a more well-rounded stay. Given that theory, he says, “The way property management systems are headed in the future is more about integration with different products and services that are going to enable increased rates upon checkout.”
Grimes says hotel companies are looking to be connected to guests before, during and after their stay. “The challenge is how to make their product available for the guest to access—even before they arrive—to update profiles, check in from home, and after their stay, leverage their records,” he says. “All these pieces have to be integrated into the property management system.”
Karen O’Neill, director of major accounts at Micros, agrees. “I foresee that more people are going to want to do more with wireless and self-service functionality,” she says. She cites the example of allowing guests to search for specific rooms, select the rooms and check in using their loyalty numbers, all from home, much as travelers are able to do on airlines with booking a flight, selecting a seat, entering a frequent flier number and printing a boarding pass.
Both O’Neill and Dehan believe that growing demand from guests in terms of services and amenities will increase pressure on PMS suppliers to add features and components, such as club and spa, with integrated booking. Down the road, they say, customers will be able to book everything they plan to do, all at once, from a hotel’s Web site: room reservation, dinner reservation, spa times, tee times, even a banquet room.
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