We hear a lot about companies moving their data to the cloud today and the hotel industry is not immune to this seemingly new trend. However, this is not the first time a technology has drastically changed the way industries operate certain departments.
In the late 1980s, every industry including the hotel industry started using MS Excel when the word spread that this spreadsheet could do magic i.e. complex calculations within the blink of an eye. At around the same time, the stand-alone PMS (Property Management Systems) were launched. Unlike Excel, PMS is a system that facilitate the management of properties, including maintenance & accounting all through a single piece of software. They replaced the inefficient paper-based methods to operate the property with a client/server configuration. Back then, the love for paper from managers and employees created a resistance to move to this highly efficient system. Irrespective of the resistance and the heavy capital IT cost such as the server and the operation cost, the Property Management Systems started to take a primary role in how hotels went about their business.
Fast forwarding 20 years, the battle is not between paper and traditional stand-alone PMS but between stand-alone PMS and cloud PMS sold on 'SAAS' model. Don't worry if you are not familiar about SAAS. We will get to that later. While cloud has eliminated the need for heavy capital IT cost or operational cost, there is still a resistance to move to the cloud. Let us look at both the upsides and downsides of migrating to cloud:
UPSIDES:
1. Access From Anywhere:
It doesn't matter if the hotel's manager is on leave or the executive director is overseas. They will all have access to the hotel's cloud PMS if they have a working internet connection and will be able to check the status of hotel, generate reports, create tax worksheets, etc. The benefits don't stop there. If your receptionist has to welcome a VIP guest and make a check-in while walking them to their suite/room, it is totally possible without making them wait in the lobby as most cloud PMS work seamlessly on mobile devices and tablets and operations can be done on the move.
2. Reduces IT Capital and Operations Cost:
With a cloud PMS, there is no need to maintain an internal server (unless the hotel stores data backups manually in a local server but most cloud PMS providers will do this for their customers at their end), or have a static IP, pay huge sums a server manager and his team to ensure the IT operations are running smooth at the hotel.
3. Hassle-Free Updates:
System upgrades and software updates could be time consuming and seriously tiring with the traditional PMS. Unlike them, the process is very different with a cloud PMS. The platform and the software will be managed by the cloud PMS provider. After all, these companies charge hotels on a subscription model for exactly this purpose and this is what the 'SAAS' stands for - Software as a Service. With this model, it is easy to switch from one cloud PMS provider to another as long as the data belongs to the hotel.
4. Easy to use & Better Customer Experience:
Most cloud PMS have an easy to use interface and it won't take more than a matter of a minute to perform check-ins, take service or house keeping requests, or perform checkouts. It is safe to say that most cloud PMS systems reduce the chances of having long queues in the front office and it lets the hoteliers take care of individual guests' need in a timely manner. Some of these cloud PMS have the feature to integrate with other digital platforms & channels such as the hotel's landing pages, websites, OTAs (channel manager), etc to offer a seamless customer experience.
5. Quick Resolution of issues:
Multi-tenancy is an over-used word when it comes to cloud products that are sold in the SAAS model. Most cloud PMS you eventually choose will be already getting used by multiple tenants i.e. hotels in this case. Unlike the traditional PMS, in a cloud PMS, when there is a minor performance issue or a bug, it will be reported by one of the hotels using the cloud PMS and the issue will be resolved for all of the hotels using the system, thanks to multi-tenancy.
DOWNSIDES or MISUNDERSTANDINGS or CHALLENGES:
1. Bad/No Internet connectivity:
While it is difficult to imagine life without the internet, we still may have to consider the possibility of what if the hotel's internet connectivity fails. This is a highly unlikely scenario but let us still assume it happens. If the hotel's internet connectivity is gone, the first assumption we all make is that we will NOT be able to connect to the cloud PMS and that is one deal breaker stopping hotels from going for the cloud PMS but wait a minute, are we forgetting some thing? Most cloud PMS can be accessed by any device including mobiles and tablets with any internet connection, which includes mobile data. This means that the hotel's staff won't be needing the hotel's corporate broadband plan to connect to their cloud PMS and manage the operations. Even cheap portable internet devices that we use in our daily life such as hotpots, mobile data, dongles, etc. can be used to connect to the cloud PMS until the hotel's internet service provider sorts out their issue.
2. Data Ownership:
Most cloud PMS vendors let the hotel own their data and adhere to strict privacy policies. It is important to make sure the hotel can get the data back when they decide to stop using their current system and migrate to another system.
WHAT TO CONSIDER WHEN GOING FOR A CLOUD PMS:
Apart from the general specifics and challenges that hotels consider such as budget, features and data ownership/transfer conditions, there are a few more important specifics to consider:
1. Uptime:
It is important to know how much time your PMS vendor guarantees the system will be online in a year. When they promise 99% uptime, you are safe and most cloud PMS vendors offer exactly that!
2. Customer Support:
Check if the PMS provider offers customer support. If they do, what channels are they available in. For example, the channels may include a ticketing system, email and phone. Ask them important questions such as the time of their availability and the average time taken to resolve an issue. The customer support requirement of your hotel must match with what the cloud PMS provider has to offer. A cloud PMS provider may offer 24/7 support services and their resolution time may be a week while another provider may offer support services only during business hours and may resolve issues in a matter of hours.
3. Minor Modifications to suit your work flow:
While most cloud PMS vendors will out rightly refuse this, there are companies that would incorporate your workflow into their PMS given they are convinced it is a good model and has the potential to be used by other hotels.
4. Additional Cost:
Some cloud PMS vendors charge hotels based on the number of rooms and the modules you choose while others have a model with a fixed charge for any number of rooms and give you a certain amount of disk space. When this space exceeds, they charge the hotel for the additional disk space needed (for example: $20/per additional GB). While the former model based on "number of rooms" may seem more direct and easy to understand, it can often be the costlier model because for most hotels, the data stored in the database won't exceed a few GBs. The model based on "disk space" can save hotels more than 50% of their cloud PMS expenditure.
Deepak founded VizConn in 2011 and writes about Digital Marketing, CMS, UX design and business in our blog. Got a question for Deepak? Let us know and we will pass it on to him. He responds to most questions via email.
