The Property Management Puzzle

August 06, 2013

Hospitality Technology

Technology innovations are changing all aspects of the lodging industry. While significant resources are being funneled into modernizing the guest experience — from bandwidth, to in-room technology, to mobile solutions — there are equally massive shifts taking place behind the scenes. Hotel management systems are shifting from on-property to cloud-based, from tethered to mobile, from data-heavy to insight-rich. Some lodging companies have been at the forefront of testing out new innovations, while others are waiting and evaluating. Over the long-term, the result is the same: a massive, impending re-architecting of how properties are managed.

A significant chunk of hotel IT budgets — 19% — is spent on property management systems (PMS), second only to the 20% spent on guest room tech (HT’s 2013 Lodging Technology Study). The industry is also mid-stream in a massive replacement cycle, with 40% planning to upgrade their PMS by the end of next year.

The capabilities that hoteliers are seeking in those upgrades are like pieces of a puzzle, and the industry doesn’t have a finished picture yet. Some are ready to embrace cloud-based solutions; others want to expand their mobile capabilities; and others are excited about the possibilities rich data can provide in personalizing the guest experience. HT spoke to both hoteliers and PMS vendors for feedback on these and other trends.

Shifting the platform to the cloud
Every vendor and most of the hoteliers HT spoke to predicted that property management systems would eventually migrate to the cloud. Pinehurst runs Agilysys (www.agilysys.com) PMS in a virtual environment on a privately-hosted cloud. “We’re an hour and a half from a major metropolitan area. There are enough providers selling the bandwidth we’d need for redundancy in a true web-based cloud environment,” says Nickelson, whose 2,000 acre property is located in North Carolina’s rural heartland. “If I look at it from a city hotel perspective, absolutely; there’d be no downfall to cloud.”

“Just because they’re in the cloud doesn’t make it easier to integrate,” agrees Dan Connolly, PhD, associate dean for undergraduate programs at University of Denver’s Daniels College of Business. “One of the promises of the cloud is that it becomes easier to integrate, so you can go more best-of-breed in your solution choice, but you still have issues with data structure and architecture.”