Rethinking Your Hotel’s Digital Transformation Strategy, with Are Morch

Episode Transcript

Are: Once you introduce new technology into a hotel, it’s going to come natural for your staff, this is going to take away jobs. You have to start with working with people first, so we empower them, you reskill them, and you upskill them to take out some of the pressure. Because if you start with the technology first, all you’re going to end up creating a lot of fears, uncertainty, and doubt.

Female Speaker 1: Going out.

Female Speaker 2: Welcome to “The Innovative Hotelier Podcast” by HOTELS Magazine, with weekly thought-provoking discussions with the world’s leading hotel and hospitality innovators.

Robin: Welcome to “The Innovative Hotelier Podcast” brought to you by HOTELS Magazine. I’m your host, Robin Trimingham. And my guest today is Are Morch, hotel consultant, and digital transformation coach. And today we’re chatting about rethinking your hotel’s digital transformation strategy.

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Robin: Welcome, Are.

Are: Thanks for having me, Robin.

Robin: Well, thank you very much for taking time to chat with me today. I’m just going to confess, I’m not 100% sure what a digital transformation coach is. So how about we start by you explaining what this is and what first got you interested in pursuing this as a career?

Are: Well, that is a good question. When I look at it, first I will take a brief explanation of digital transformation today is what we call as a cross-department effort to reimagine the way hotels uses people, processes, digital program, and devices to drive new business and revenue. And my purpose as a digital transformation coach, what I do is help people and technology to work in harmony together. That’s primarily what a digital transformation coach do.

Robin: I like that, people and technology and harmony, we could definitely use more of that. So why is there such an urgent need for digital transformation in the hospitality sector, particularly at this time?

Are: What we are seeing as a result of the pandemic that the consumer patterns and behavior totally changed. Consumers now have learned to use digital tools, mobile devices particularly, and that’s how they have created experience while they were confined to being at home. We have seen they’re using mobile devices to order services from Amazon, order services from their local grocery stores. So the digital transformation is actually driven now by the consumers. And that’s how we see that they are now finding the hotels with communicating with their social networks and also looking at social media. So it’s a result of the COVID that we see that digital transformation is becoming more urgent or important today.

Robin: That’s a fascinating point that you’re making, because I’ve been having lots of conversations with people in all different parts of the industry, and everybody is talking about who is driving transformation, where, and what’s happening in some very unusual places. So as hotels emerge from the pandemic, why is it essential that they learn how to leverage what I see you’re calling a digital hurdle as a way to engage and interact and respond to guests’ needs?

Are: We’ll lead back to the previous point that says that what we see is that because of all the information and all the data that customers or consumers now have access to, they are now almost I will say, require even…it’s almost at that point that they’re requiring that hotels or brands is working with them instead of for them. We have to define the service offer or experience offers that we now call it in collaboration with the customers. So we need to use the digital tools or the digital devices to lure new customers and collaborate and communicate, and most important, connect with them.

Robin: So what are some of the benefits then for employees of hotels? And why should hoteliers care about all of this?

Are: Well, the benefits, of course, is that what you see when we use the digital transformation or the processes is going to be two process that’s going to be important, that the first part of the transformation is the people transformation and then the second part is the technology transformation. The benefit here is that, the access to all the data. Because what we now we’re seeing as a result of all the data we have access to that the hotels now have the golden opportunity to tap old-sided traditional market into new markets that they never talked about before or that they never worked with before. Because now we see as a result also for many hotels that we now have day rooms, we have co-working spaces, some hotels is even using the rooms as a dorm room for students. So we are rethinking the service offers or the experience offers that we have. And together with the technology, we now see new ways that we can cut costs and also help particularly the employees, become more productive when working with the… We are not only just working with the customers, but we’re also working with the employees. That was the first point of it. So that’s going to help, particularly on the productivity point for hotels.

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Robin: Now you just mentioned the magic words for hoteliers that are struggling to build business after the last two years. When you talk about cost-saving, how can hotels save costs by employing a strategy like this?

Are: The cost we see particularly to what they’re saving is some of these digital tools help with particularly optimizations and gathering. For example, a lot of hotels are implementing chatbots now on their websites to gather data and gather information among the customers and also help them streamline the booking process and help them with generating more direct bookings through the types of services. But also in addition that you would be looking at the workforce, that’s the people for how we can help them communicate better with doing the service that they was intended to do at the hotel to help the customers with their experience. So it’s data and experience is going to be key that they’re going to build on and adding because this is about adding leap of values to information that you gathered from the customers.

Robin: So this is really about gathering data to improve guest experience then?

Are: Correct. Correct.

Robin: Okay. So the hotel industry everywhere has been decimated by the events of the last two years. And as we’ve just discussed, we’re looking for ways to save on cost. Why should hoteliers be committing time and financial resources to this training at the moment?

Are: Well, that goes back to what we thought of in the beginning, [inaudible 00:09:22], it’s like now we see the consumers they only transform then. They are the ones that are setting the stage. The demands is coming from the customer style. The tools, they know what they can do with them. So the hotels have to meet this demand in some way. And of course, that’s hard to do. But reskilling the staff and upskilling the staff to me is all about building the skills to meet the demand that’s out there now.

Robin: Well, that makes sense. Can you give us an example of brands that have benefited from digital transformation?

Are: Well, one of the brands that we have seen that have big success with is particularly Wyndham and all the hotels under that are under the Wyndham umbrella, because they started the digital transformation process in the right hand where they started with the people first, which is critical to understand this, is we have to start with working with the people first. So you empower them, you reskill them, and you upskill them to take out some of the pressure. Because if you start with the technology first, all you’re going to end up creating a lot of fears, uncertainty, and doubt. So you have to make sure that you get the people on board first and then you get the technology, because then you have to take a little bit out the fears and the change of mindset, that’s what Wyndham has had a lot of success with. They focus on the mindsets so that people are in line with the transformation and the digital tools that’s coming. Because we know that once you introduce new technology into a hotel, it’s going to come natural for your staff, this is going to take away jobs. All those like a circle of effects that creates fear, uncertainty, and doubt. So since Wyndham is a brand that I’ve seen build relationships and make friends first. That’s the key point.

Robin: That’s very interesting because you’re right, in any change management cycle, there are the front leaders and the fence-sitters and the resisters. And if you don’t have everybody rowing in the same direction as you will with some new technology, yeah, the whole thing could unravel, couldn’t it?

Are: Yes. That is correct. We saw some data from McKinsey, which looked at a lot of the hotels and there it’s like…because the digital transformation there started way before COVID happened. And the reason that it wasn’t particularly a success in the beginning was because of that type of mindset that you’re mentioning that the fear and the employees or the leaders was not working with, the key word is working with, the employees working with the customers so they can now gather the data not only from employees but also the customers, and then you mix it in together with what’s going to benefit both the customers, benefit the employees and benefit the hotels.

Robin: I can see why this is so important. What’s your key message to everyone who listens to this podcast?

Are: The key message is, like I said, start with the people first. That is essential. If you don’t start with the people first, you’re going to end up in trouble. Once you have the people on board, the processes would start working itself out because we have to look at that. Particularly, in the hotel industry, we have a lot of data silos or silos as they call it. And what we know is working towards more to looking at creating more data lakes which cover whole mobile technology, social media, artificial intelligence and information of things, or Internet of Things as they call it. All this is going to be part of this new processes that is part of digital transformations. And if you don’t have the people on board, you’re going to fail.

Robin: I agree that it’s a very interesting and exciting time and it’ll be good to see where things are in a couple of years once hopefully the health challenges of the recent past are well behind us and some of these programs are more mainstream. Are, I want to thank you so much for taking time to chat with me today. You’ve been listening to “The Innovative Hotelier Podcast” brought to you by HOTELS Magazine. Join us again soon for more up-to-the-minute insights and information specifically for the hotel and hospitality industry.

Female Speaker 2: You’ve been listening to “The Innovative Hotelier Podcast” by HOTELS Magazine. Join us again soon for more conversations with hospitality industry thought leaders.