In The Future of Hotel Technology, a new GX Spotlight series, Simone Puorto, founder of industry consulting group Travel Singularity and self-proclaimed “renaissance futurist” takes us through the state of hotel tech and where it could be headed.
This second article takes a look at what is arguably the heartbeat of any modern hotel operations: Property Management Systems.
What’s the last thing you’d want to do as a hotelier when it comes to big operational projects? If you answered switching Property Management Systems, you’re not alone. They’re cumbersome, complex, expensive, and not always able to address current or future needs. A current wave of PMSs have cropped up to address this issue but use a wholly different approach to solving this problem to the point where it’s questionable if we can even call them PMSs.
How did we get here and where are we headed?
Most PMS systems were built in the 80s or 90s before the concepts of cloud structure or integrations existed. And since then, we’ve retrofitted these now ancient solutions to try to work with current ones. But let’s back up a bit. The main problem with, or, to look at it another way, the core feature of PMSs is that they are at the very center of operations, making them difficult to change because it would impact many parts of the business, requiring retraining staff, and risking loss of data and the pain of reconfiguring hardware. Most hoteliers avoid changing PMSs for that exact reason. And most hoteliers are often stuck with old or obsolete systems for the same reason. (This is something that cloud-based PMSs have sought to solve, and have largely succeeded, though they have their own shortcomings. We’ll cover this later on.)
Another difficulty is that it’s quite hard to compare PMSs, especially when there are new offerings that work differently than the older ones. It’s certainly not an apples to apples comparison. The comparison tools available can often leave something to be desired. It’s just too challenging to compare all the features of PMSs because they have so many functionalities and so many integrations. It can easily be overwhelming.
Even if your goal is to just find the cheapest solution, there are no clear-cut paths forward. Often the costs of using a PMSs are not clear upfront. All this makes switching PMSs perhaps the number one thing a hotelier avoids.
This has caused the PMS market to default to caution, slowing innovation. Yet it’s obvious that we should be able to try out a PMS, and swap it out easily as needed.
The easiest way to do that is to make PMSs more like hubs rather than an all-in-one system, using open APIs to allow users to plug in other software and tools as needed. The PMS would then act as a central command, pulling in data as needed. This is what the new generation of PMSs sought out to do.
The New Wave
Making this change requires a shift in thinking in what we expect from our PMSs. The days are numbered for the era of PMSs being all-in-one tools that can do everything from process payments to manage self-check-in. In order to achieve more flexibility, we’ll need to move towards this hub-like system. The responsibility is on the hotel to make a bold change, but it’s also on the provider to do the same.
When it comes to the new wave of PMSs they’re positioning themselves to be a central hub for all other tech. This new generation of PMSs are mostly cloud-based or even cloud-native, meaning they have been built in the cloud to begin with. This structure allows them more flexibility, especially in terms of integrations. In particular, PMSs that are built using cloud-based services like Amazon Web Services (AWS) can securely store data, enhance customer experiences, and increase operational efficiency.
These new PMSs are not a silver bullet, however. While they are super agile, they often do not have the same amount of functionality as the legacy PMSs. A common real-world example is that many of these new PMSs don’t have MICE management functionality, so a hotel will buy external software to plug into their cloud-based PMS. And many providers in this new wave are startups so they lack the experience and customer trust of a 20-30-year-old company.
So when these PMSs don’t offer all the bells and whistles that a legacy PMS does, can we still call them PMSs? When does a PMS stop being a PMS? In other words, what is the minimum tech needed to define a PMS?
It’s an interesting point in the evolution of tech when it becomes a semantic issue: Semantically, a “Property Management System” should help to manage the property. However this specific functionality in this new generation of systems is becoming less and less common.
The industry may need to come together to agree on what defines a PMS. We have two worlds: The very heavy legacy system world and the very light modern system world. Both have their pros and cons. And this is the limbo stage we are stuck in currently. Ultimately we need to agree on what a PMS is and what it is not if we want to find a way forward.
Where We’re Headed
Look at Dubai. The city has exploded with hotels in the last few years. Most of these hotels started out using a major legacy provider. Much of the functionality these hotels want will either take years to implement or will simply be impossible, so many hotels in Dubai have now migrated to the new generation of PMSs.
This is a market driven by frustration and it’s the antithesis of good tech: Tech should empower us and liberate us, not confine us and make our jobs more difficult.
Eventually, we’ll reach a time where the minimum features for a PMS will be agreed upon. When that moment comes, things will stabilize. And by that time, older legacy systems will adapt to the cloud (as some have already done or are doing so), merge, or die. And the newer generations will also consolidate, lose funding, or evolve.
But for now, we’re living in the middle years in terms of the evolution of PMSs. Darwinism will run its course and the industry will evolve. We’ll eventually have fewer but better PMSs.
Ultimately, hoteliers shouldn’t be so worried about the fine details of the tech they use, they should worry about their guests’ quality of sleep and customer satisfaction. It is hospitality, after all. Tech should seamlessly support this work. If there’s one piece of advice I can offer, it’s this: Don’t change how you operate because of software.
Stay tuned for the next article in the Future of Hotel Technology series where we look in depth at some of the most exciting, transformative tech that awaits us just around the bend.
This article was originally written by the GX Spotlight team. It has been moved here as part of the Shiji Group family of hospitality technology brands.