What’s Next for the Future of Hotel Property Management Systems

Hotel technology systems have come a long way in recent years due to the rise of various innovations like the cloud, the adoption of open APIs, and the application of artificial intelligence and machine learning to everyday business operations. The global pandemic has pushed certain sectors of the hospitality tech industry further into the future. SkiftX spoke with Shiji’s COO Kevin King to look at Property Management Systems, in particular, and how hotels stand to benefit from this new era of technological innovation.

Note: This article was originally created collaboratively by Shiji and Skift’s branded content studio, SkiftX.

SkiftX: Shiji has expanded globally over the last few years by growing its portfolio and opening new offices. What’s the strategy behind this?

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Kevin King: Our chairman set some milestones on where we should be heading in the coming years. One of those points was to become a truly global company, servicing the hotel industry worldwide. We built a product portfolio that fit the needs of our customers — one that works with existing technology where customers can pick the products that work best for them or could be combined into a complete stack.

Our strategy has really been to listen to the market and the customers and grow our portfolio and offices accordingly. For a technology company, we’re quite different in that we started as a service company, so service and support are really part of our DNA.

SkiftX: Shiji has been researching the property management space in the last few years to uncover what’s top of mind for hoteliers. What are some of the most valuable findings from that research so far?

King: In a recent study, we confirmed that cloud migration has been a major influence on hoteliers’ technology choices. By 2023, it is estimated that the majority of hotel tech infrastructure will be completely cloud-based. As always, the guest experience remains the main motivation with hotel technology, and the need to create a frictionless, guest-first approach is essential.

We also found that while guest messaging solutions are entering their state of technological maturity, they are still pretty much underused in hotel properties. Despite the huge advantage of rapid interaction and service of guest messaging solutions, hotels are still reluctant to adopt them fully. This is an interesting space to keep an eye on.

SkiftX: In general, how are enterprise hotel companies thinking about property management systems at the moment? Has there been a mindset shift over the last few years, or due to the pandemic?

King: Enterprise hotel companies are looking for connectivity and security. While the two aren’t mutually exclusive, they pose a real challenge, especially when you consider thousands of hotels in dozens of countries and continents.

Another point we’re seeing is that in the past, when technology wasn’t such a central piece of guests’ lives, the smartest and best way for hotel chains to implement technology was to build their own. But as technology becomes so much more complex with more connectivity, more security issues, and more data protection issues, many are looking to buy technology that fits their needs.

Touchless solutions will continue to be important, and many of the older solutions can’t keep up with such quick and sweeping changes across an entire estate. This is where we come in and try to help.

SkiftX: What are some challenges you expect enterprise hotel companies will have to increasingly deal with over the next few years?

King: One is data security and privacy. An abundance of strict laws have been passed — and more are being written — in Europe, the U.S., Russia, and China, among others. We’re seeing what Apple and Google are doing with cookies, and it is clear that if guests can’t trust their hotel to keep their data safe, it becomes a critical issue for hotels.

“We get more scrutiny than probably any other hotel technology company. … it forces us to raise the bar in the products we build.”
Kevin King, COO Shiji

Then come challenges like data sovereignty. Most of the legislation around this hasn’t been fully worked out yet, but governments are demanding that data from their citizens doesn’t leave their territory. Most systems today aren’t set up to deal with that.

As a Chinese company, we know how important this is, and we get more scrutiny than probably any other hotel technology company. This is something we welcome, as it forces us to raise the bar in the products we build. We subject our systems to external audits to ensure we’re in full compliance and beyond to make sure that European citizens’ data remains in Europe, that U.S. citizens’ data remains in the U.S., and so on. Our customers value this, but it will become a big challenge for global hotel companies.

Finally, I would say the challenge for hotel technology in general is change management. So many things are changing so fast. The technology solutions that have worked for the past few decades will probably not work for the coming decade.

SkiftX: How can a strong property management system help solve these issues?

King: I think the property management system is very much still associated with the old on-premise system, which hasn’t evolved in many years and is often a risk to the hotel’s ability to evolve and deal with security.

We would like to change the model from a property management system to a hotel’s technology platform. The system is the core part of the hotel’s technology, and other solutions connect to it. If the platform’s architecture is strong and well-built, then it becomes easy to adapt to change, new legislation, and connected solutions.

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The word ‘platform’ really illustrates the concept well — even more than ‘hub’ or ‘system’ — because it can be the base for layers of technology and connections to be added and removed later. ‘Property management system’ is still the term that most people use and that’s fine, but we want to move beyond that old definition and bring it to the 21st century.

SkiftX: More hotel companies are beginning to show a great deal of interest in innovation and keeping up with new technologies, but don’t know where to start. What advice would you give them?

King: Firstly, I would recommend hotels look at guest safety, security, and privacy. These are real issues that need to be addressed. The immediate safety steps are probably done or well underway. For instance, reducing physical touch points as much as possible, such as payments and check-in. Data security and privacy enhancements aren’t as visually impressive as making a new app, but are much more important. Our industry is about trust. It is a hotel’s duty to ensure that trust is respected with secure and private systems that do not share data in an indiscriminate manner.

Put your guest first and think about the technology that will provide your guest with a better experience. Guests will have more choice in the short term, so find things that can help you gain a competitive edge.