PowerPoint Presentation 03/01/2014 1 Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved1 Technology Strategies for the Hospitality Industry, 2nd[.]
03/01/2014 Strategic Hospitality Technology Investment Chapter 13 Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved REDUCING EXPENSES AND INCREASING PROFITS • The single most important thing to remember when you think about strategic investments in hospitality information technology (IT) is that these investments must generate a positive return on investment (ROI) just like any other strategic corporate purchase Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved 03/01/2014 REDUCING EXPENSES AND INCREASING PROFITS • Decreased Expenses • Increased Gross Profits Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved SYSTEM EXAMPLES • Yield management systems can generate higher gross margins on room revenues while restaurant menu management systems can generate higher gross margins on food items by substituting less costly ingredients or by using historical sales data to accomplish the following: – – – – – – Develop more effective pricing strategies Create a more effective menu mix Schedule employees more efficiently Improve functionality for offering and controlling promotions Process credit and gift cards more efficiently Improve functionality for cross-marketing other services to existing customers – Increase covers or average checks through the implementation of the new system Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved 03/01/2014 CASH FLOW AND COSTS • There are many formulas for calculating specific cash flow relative to different types of investments, and a good technology investment can and should be reduced to a financial investment equation before a purchase decision is made Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved SYSTEM SELECTION PROCESS Verify/develop the conceptual design for the enterprise Define functional and system requirements for the component application(s)/create organizational consensus on the requirements Compile a request for proposal (RFP) Develop a vendor short list Solicit proposals Assess proposals against criteria Visit reference sites Have vendors provide demonstrations Final selection Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved 03/01/2014 SYSTEM SELECTION PROCESS • VERIFY/DEVELOP THE CONCEPTUAL DESIGN FOR THE ENTERPRISE • DEFINE FUNCTIONAL AND SYSTEM REQUIREMENTS FOR THE COMPONENT APPLICATION(S) AND CREATE ORGANIZATIONAL CONSENSUS ON THE REQUIREMENTS • COMPILE A REQUEST FOR PROPOSAL (RFP) • DEVELOP A VENDOR SHORT LIST Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved SYSTEM SELECTION PROCESS FIGURE 13-1 Purchasing a New System Requires Proper Planning A Matrix Can Help Keep Information Organized Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved 03/01/2014 SYSTEM SELECTION PROCESS • SOLICIT PROPOSALS • ASSESS PROPOSALS AGAINST CRITERIA • VISIT REFERENCE SITES • HAVE VENDORS PROVIDE DEMONSTRATIONS • FINAL SELECTION Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved IMPLEMENTATION • A proper implementation procedure needs to be adopted whether it is hardware or software • There are ten steps Choose a project manager from your existing staff Set a schedule Establish a training system Meet with the vendor and exchange notes on steps through Stop and analyze Start implementation in one department Stop and analyze Move on to the next department Stop and analyze again 10.Rollout the system propertywide Technology Strategies for the Hospitality Industry, 2nd ed Peter D Nyheim and Daniel J Connolly 10 Copyright ©2012, 2005 by Pearson Education, Inc Upper Saddle River, New Jersey 07458 • All rights reserved