In the wake of the COVID pandemic, hotel operators are facing intense pressure to mitigate rising labor costs while still providing exemplary customer service. While operators have always been sharply focused on labor costs as a line item on the expense report, the current economic climate will shape the way hotel companies build their teams for years to come.
According to a May 2022 AHLA survey, 97% of hotels indicated they are experiencing a staffing shortage, 49% severely so. Survey respondents indicated they had hired an additional 23 employees per property in the last three months but were also trying to fill an additional 12 positions.
As operators search for solutions, many see the rising adoption of Robotic Process Automation (RPA) as a way to help bridge the gap, enabling leaner teams to get more done, faster.
What Exactly is RPA?
Robotic Process Automation brings together different data points, often housed in different applications or databases, to streamline and execute tasks or processes that can be accomplished by a software “robot,” rather than requiring human involvement. This typically results in substantial time, labor and cost savings, while freeing up employees to perform more critical high-touch functions.
In hospitality, it can be applied in the front of house and back of house to streamline workflows and substantially reduce manual efforts. But its adoption has been slow.
“When we think of AI and robotics being used in the medical field to detect and cure cancer, we applaud it, yet when we consider using AI, RPA, or physical robots to aid us in hospitality, we get nervous,” says Simone Puorto, former hotel GM founder of Travel Singularity, in a recent Hospitality Net report. “The misunderstanding is that we will lose the human touch when tech is introduced. Yet the human touch itself often creates problems and inefficiencies in the guest experience.”
On the guest-facing side of the business, automation can be applied to virtually every touchpoint of the guest journey. Marketing automation comes in the form of upsell opportunities, re-marketing or recovery campaigns in the pre-stay, pre-check-in and post-cancellation stages.
In the back of the house, automation is helping the marketing, revenue and sales departments get more done with fewer resources. Integrated CRM systems have become the heart of new, guest-centric personalization strategies such as automated email marketing programs that are proving to be huge time-savers. Revenue managers are tapping automation to stay on top of pricing and demand trends.
RPA reduces the common challenges presented by running a business on a fragmented tech stack. Siloed systems often lead to a great deal of manual effort, such as copying, importing, exporting data from one system to another, or the common “swivel-chair integration.” Through RPA, operators can create workflows that fill feature gaps or replicate features from other systems, saving them time and money.
Examples of RPA in Hospitality Today
Native CRS, CRM and RMS applications provide SHR with unique access to highly actionable data to build tailored workflows for each operator’s individual needs. Several SHR hotel partners are currently using RPA to remove previously manual tasks. In many cases, they’re automating the data sharing between systems, where processes inevitably break. So far, RPA is providing the most value in the following five categories: Business Intelligence, Marketing Automation, Operations and Support, Revenue Management and Reputation Management.
For example, one partner offers attractive rates to guests that book ahead and pay 50% upfront. In this scenario, the guest’s credit card on file is charged the remaining 50% a handful of days before arrival. Because many guests don’t track when the remaining balance will be withdrawn, their credit card will sometimes come back declined. Prior to implementing RPA, a call center representative was addressing these denials each night – often dozens – through a manual process of copying, pasting and composing emails to guests.
Since, the hotel operator has defined the proper workflow and SHR has built an automated process to remove human intervention. Other automated workflows that have been deployed today include functionality around abandoned cart re-marketing, upselling, and sharing call center messaging data.
In the Hospitality Net report, Puorto identifies additional real-world examples of automation directly leading to labor savings:
- Pre-qualifying group sales RFPs requires around 60 person-hours per month. By automatizing the task, an average hotel can generate additional revenue due to faster response time, while drastically reducing labor costs.
- Managing rate codes in PMSs and GDSs requires around 100 person-hours per year. The application of RPA can increase accuracy, reduce errors down to zero, and generate recovered revenue.
- Daily revenue reporting can take up to 1,000 person-hours per year. Therefore, on top of producing more precise reporting, the use of RPA can save labor costs.
Tip of the Iceberg
As you see in the examples above, RPA is not a lofty, unattainable goal for hoteliers. It’s saving considerable time and money for operators today, but we’ve just cracked the surface in terms of the ways automation will shape the future of hotel operations. To get where we need to be, hoteliers and technology solutions providers must work together to prioritize innovation.
“I don’t think it’s hard for hotels to grasp the opportunities that automation offers – I think it’s hard for them to have confidence that the technologies they select for their tech stack will work together the way they expect, and not create more problems than they solve,” Kathryn Murphy, owner of The Murphy Gallery & Hotel in Dublin, told Hospitality Net.
While systems have been trying to accomplish some of these tasks for years, we feel there has been a holistic shift in the way businesses are approaching modern integration strategies. Open APIs and cloud technology are paving the way, and in general there is less finger-pointing and more true partnerships among suppliers and hoteliers.
Hoteliers must get back to providing the personalized service our industry is known for, and accelerating the adoption of Robotic Process Automation will provide the framework moving forward.
By Angelo Directo, VP Design and Innovation at SHR