Hraba Hospitality Consulting

Spot on and completely hilarious, I am sure many of you have felt this frustration. Apparently, everything is negotiable nowadays, eh? This makes it nice and ridiculous, for easy lunch time digesting.

A colleague and I were bemoaning the difficulty with modern customer service, and the fact that so many tech support numbers are no longer offered as toll free unless it is someone like HP or Dell. Per usual, I fanatically inject my own experiences into the situation, and muse about the long and wild road of in-room phones at hotels… specifically the way technological innovation and advancement has, constantly, caught our industry unaware to the point that we shoot ourselves in the foot.

It isn’t right not to have access to free phone tech for a product, but it is the way modern business is happening. Telephony has altered greatly (understatement) in the last two decades…and property level we are still calling them “PBX”. What’s more is that the IT guys at hotels are well versed enough to know just to ignore it.  I have seen one or two try to explain.. “Well the PBX doesn’t really exist anymore”, the GM will point to the operator, and then the IT guy capitulates with a shrug.

We hotels used to gouge consumers for phone calls because they had no choice, and it was a BRILLIANT revenue stream. Then came calling cards, and hotels started losing lots of revenue… and per our typical furrowed brow, it took us a couple years to figure out why. Even dial-up modems for AOL and prodigy services were a complexity to us… which is why we started charging people to call out to 800 numbers. Of course this garnered more distrust from guests about our call accounting, but it also got the enraged guest at the desk who had left AOL connected for 3 days and owed the hotel $5545 for a 2910 minute phone call to an 800 number.  I had at least 3 of those that I can remember… and those people were all completely, and totally, hysterical.  Not the funny kind, either.

By the time we admitted to ourselves that the revenue stream was lost and started charging enough simply to cover costs… hotel guests had already decided to never trust in-room phones ever again. Calling cards were used almost exclusively, and guests now have cell phones that simply makes in room telephones, for all extensive purposes… obsolete. This has been patently obvious in the last 5 years…. in-room phones are nothing more than an intercom now, which is why telephony solution providers are trying to make them into a marketing gimmick with big LCD colour touch screens, etc. What’s more is that anyone silly enough to install payphones on property has them regularly taken back out within 3-5 months because it simply isn’t profitable for the companies to maintain them.

By the way – that might be my only professional advice in this post, along side the historical ramble…. stay away from that “slick” nonsense.  LCD screen phones are nothing more than an annoyingly bright & pricey business card for in house outlets where guests are already likely to contribute incremental revenue. These phones are a gimmick, and they are part of the technological in-between period of telephony companies trying to generate need and create a new niche for them while everything swirls up in the air.  These “hubs” will become something incredibly powerful, and useful… but the new tech coupled with cost and lack of dynamic functionality (beyond being flashy) makes them a poor investment for the time being.  For now, think of in-room guest phones as IP “intercoms” for your next project, and you will save a lot of money. Heck… you may start having guests order room service online before calling on the room phone…or they may plan travel without even considering a voice call – like GPS enabled hotel booking apps, or basically just making an app to make every department available by PDA as seen at the Malibu Beach Inn. Even Choice Hotels has an incredible mobile app that not only sells their brand, but it enables an entire community of brand endorsers.

So in this panic of the phone industry changing, everyone has been hit… robots handle call volumes of humans, 800 numbers are incredibly expensive, and customer service has tanked in general because of it. In 20 years we went from fully staffed calling centers with live operators to a computer voice that handles the volume of 20 employees’ worth of labour. With cell phones all but destroying traditional landlines, they have also made the 800 number obsolete. When it is used, it is strictly for high end marketing, because no one else can afford it. It usually only goes to the departments that generate revenue (SALES) and the guys doing all the real work have the fun of not having one, then fielding complaints from already unhappy consumers that have just been further inconvenienced.

As we continue forward, I think the traditional phone will die, but rise a bit like a Pheonix – the same thing existing in a different form.  It will not only take on the traditional rolls, but also a hotel intercom, then soon to be an internet hub… and slowly integrating with other guest room controls and being not unlike the new Verizon Hub, which demonstrates that you can have a phone that is highly adaptable and functional.  Think of it as the Looney Tune cartoon “House of the Future” where panels & buttons on the wall call outside, surf the web, program the house settings, washes, cools, power management, etc.  The only thing is that we are a long way off from that kind of functionality…. and for now spend as little as possible on both ends.  As for 800 numbers, if the department’s revenue can’t cover it without impacting business, it simply isn’t a wise choice.

In the future, however, someone in your hotel will also have grown up playing around with making apps, and you will have your first person on staff managing the 2.0 of your hotel.  I like to think this would be a salaried position from a truly innovative management company, but I am aware this starts with property level people engaged with the brand that have extra time and know how.  As for the salaried position, we shall see.  I know we are all looking down the road at Concierge 2.o, and few of us might have thought that could be possible. Now with IP, Google Voice, and even browser enabled chat sessions… there is an exciting future of unending real time communication with brand advocates (returning guests) and potential clients.

These conversations about archaic forms of communication will fall to the wayside during the tremendous fervour for hotels’ future comm abilities, where we will have to adopt a more pro-active and less wary view of technology, so the hospitality industry can be carried forward by technology and the advent of 2.0 – at the intersection of commerce and the community that is selling your brand.

Someone had asked what systems of PMS are out there… and where you start.

Frankly, researching, engaging, and dealing with the endless sales negotiations is daunting, and tiring. I still don’t get why PMS’ aren’t transparent and straight to the point. I don’t want to negotiate for 3 weeks just to find out there is a “competitive discount” at the end worth $60-100K. That’s asinine, and it wastes people’s time. Until then…. here we go with some loose numbers about IT!

A Note About These Numbers.

I have done my due diligence for many hotels, and these are the trends.  Vague, non binding, budget purposes only numbers;  IE – don’t quote me, but these are my experiences. I don’t think it is unethical to share these numbers… they are loose based off of many projects, and I am also not divulging the sensitive licensing fees, software costs, integration and implementation fees, etc. Ask me more or email me if you want specifics.  What’s more, this doesn’t totally include all hardware, but the big numbers at the end should compensate for much of it.  This isn’t stubbing out fiber optic, nor is it all the imlpementation time for your tech people to set up the server racks, etc.  Of course, that’s a different budget.  This is basically IT software plus some of the peripherals that make it run (like touch screen POS, etc).

Also… in interest of environmental concerns… there is little wrong with having redundant RAID array servers, and having your system work off of a thin client environment.

I am available, of course, to talk about this at length.

What PMS should you buy? How much should you budget?

The PMS you should buy is obviously the one that works for you.  There are many options, like the AMAZING and TALENTED and Customer Service oriented guys at Mirage Hotel Systems.  Sure it’s not pretty, but it’s going to run about $45K, and they are guys you can call to change something and it will be changed IMMEDIATELY.  They are amazing, I have always found it a pleasure to work with Armond and the gang… and if you talk to them, mention that I sent you.  They rock.  But it isn’t necessarily appropriate for some luxury hotels, or complex layouts, etc.

The big players (in my opinion) are as follows:

PAR/SMS – Springer Miller Systems will be the most expensive, and I am not a big fan. It’s huge, clunky, they oversell it, and the implementation and integration is not so great.  It used to be the leader, and might still consider themselves the “cadillac” of PMS.  I say it’s big… REALLY big.  It’s also prohibitively expensive, and the back end interfacing and tech isn’t always the best.  Of course, that is a problem with almost all these systems.  Once they sell it, they never seem as eager to fix things after they get the check.  Budget $166K w/o modules. It’s a *beast*… modules included I would say a total would be around $300K+, easy.

Micros/Fidelio Opera – Probably the industry leader now, and for good reason.  A windows based program that is slick, intuitive, and often prohibitively expensive.  They have the industry leader for F&B POS, but the sales and catering is light to say the least, and I am not even sure they have an integrated accounting system.  It’s a solid PMS, and you will be happy. Period.  However, the S&C module is nothing compared to Delphi, and I have seen properties buy it, and switch to delphi years later.  The spa system is limiting too, but not in price.  Micros/Fidelio Opera – $130-150K w/o modules.  Modules -
F&B $15 – $25K depending on the restaurant
S&C – $30K approx
Spa – $35 – $40K approx

This will end up around $250K for the total with modules.

Agilysys Visual One – Visual One is fantastic, but the peripheral modules (desk, F&B) aren’t so easy on the line and front of house as I would like.  The back end accounting, G/L, month-end is ***AWESOME*** (read, “like a dream”) and very simple. What it comes down to is sacrificing front end functionality with back end convenience.  The problem here is that you are paying that back end controller more money than the simpler line staff who have to deal with some complex, and frustrating issues.  It depends if you want unhappy staff and happy owners, or vice versa… however simplistic that sounds.  Honestly… we always want our reporting and accounting as streamlined as possible, but not at the sacrifice of losing a functional front of house system that is intuitive and simple to learn for the ever rotating line staff and management that actually have to deal with day to day operations.  $95K w/o modules
Modules – total them all up and it will run $260K or therabouts.

Northwind Maestro – I like this system, because we have made them do a couple builds where they are interfacing with industry standards for the modules… So instead of relying on an entire system that has multiple weak spots… IE Agilysys’ Visual One F&B & S&C weak spots, or Micros’ S&C, Spa, and Accounting weak spots, etc… you get to build out a vetted system with Delphi, Micros F&B POS, MAS 500 Accounting, and Harms Millenium for the spa. It does create a lot of extra work and communication, but you can rest assured that from front of house to the G/L and beyond you will have a solid system that can do a lot.  $80K w/o modules.  Modules -  The total cost ends up being around $180K – $210K with the benchmarked modules. So it is cheaper as well.

A word about interfacing

When you are interfacing, you have to realize that when Opera or Par/SMS talk about an integrated system, they aren’t really talking about an “integrated system” like Agilysys Visual One.  That one is wholly and completely tied into all parts, while the other systems are simply *interfacing* with other modules.  That means when you are choosing, it is just as easy to go with Delphi and an XML interface for inventory management as it is to go with the preferred S&C module that the company offers.  This is because those modules weren’t built with the PMS in mind, as much as they were bought as 3rd party programs and co-opted by the PMS to work with the system.  All this means is that you should pick systems you are comfortable with, and not feel the need to be a partisan picker, and go with an entire bundled system.  This is why we have gone with Northwind Maestro… it’s a great windows based PMS that integrates well with all the industry standards.  I also didn’t feel the hard sell from them as I did from other vendors…. Northwind wanted us to be successful so they looked successful, instead of just selling what they offered.

I am really happy with Northwind Maestro.  It will be the most affordable of the lot, and I am pleased with them across the board. The modules aren’t my favourite, so usually we use Maestro and go with Delphi for S&C, Micros for F&B, Mas 90 (should work, but mas 500 is better, a 2 way XML interface, and simply better reporting/much easier).. and HARMS MILLENIUM for the spa… because Harms is awesome, and I don’t think there is a better spa software anywhere.  At least not yet.

And that’s my two tech cents!