What it is, and how it can help
your business achieve more.
Something momentous is happening across the hospitality industry. The conversation is
shifting. More and more operators are having new conversations with their technology
vendors. Instead of going to them with a shopping list of software, POS, servers and
terminal requirements, they are asking a different question: how can technology help us
deliver our business strategy?
And all the while, technology vendors are bringing lots of solutions and devices to market, all claiming to be able to make
you faster, slicker, more profitable or deliver a better guest experience. The problem is what to choose. Make the right
decisions and you can see huge benefits; get it wrong and you are stuck with an expensive system that doesn’t do what
you need. In this white paper, we look at how hospitality operators and vendors can work together to deliver game-
changing benefits through digital transformation.
What Is Digital Transformation?
In short, it’s about creating a totally integrated technology framework that
underpins your operations. It’s building an enterprise architecture that brings
together data sources such as POS, payroll, purchasing, mystery diner, menu
management, bookings, reviews and training into one central reporting hub - and
then using it to deliver meaningful, accessible insight for people at every level of
This kind of infrastructure not only allows you to automate where possible — and
desirable — it also lets you see and analyze data from across the business, turning
the mass of data previously in silos into reliable insight that helps you make better
At HQ, this feeds faster, better decision-making. At site-level, it frees managers and
teams to focus on the customer. Overall, it streamlines processes and reduces
For example, in a digitally empowered business you can easily see how an
investment in customer service training (administered by training software) has
impacted upsell performance (recorded by POS and accounting software), by
individual, site, area and overall, by showing both sets of data in context with each
other. Without a robust hospitality operations platform, this would be a laborious,
unreliable manual process.
Why Do You Need It?
Think of how Uber, Airbnb and Amazon have changed the way we live. They
have harnessed technology to sell cab rides, room nights and goods of all kinds
in a completely new way. Meanwhile, traditional hospitality operators have
largely, chosen to let this wave break over them, believing that theirs is “a people
business” and therefore somehow immune to technological disruption. That’s
probably what taxi drivers thought.
Of course many operators have invested in specific solutions, often as a kneejerk
reaction, still less often with consideration for compatibility with other technology.
Inventory solutions, menu software, POS and accounts packages have all
appeared, along with third-party plug-ins, such as TripAdvisor, mystery diner
services and health and safety. Some even work on a mobile platform, so unit
managers and staff can access them on their own devices.
And new applications for the hospitality sector are appearing on the technology
landscape quicker than ever, especially in customer facing applications designed
to drive greater engagement with customers. In a crowded market, these offer real
potential to stand out from the competition so can’t be ignored. But implementing
more and more new technologies only adds to the complexity.
The result is a surge in data, much of which is presented in silos making it almost
impossible to see and understand in a wider context. The answer is to change the
way we look at, and invest in, technology.
Christian Berthelsen, CTO of Fourth, explains: “The fact is, IT is often seen by the
hospitality industry as a cost, not an investment. It can seem out of touch with the
reality of the business, which means it is underfunded. We need to raise our eyes
from day-to-day issues, such as keeping the cash registers working, and design
an IT architecture into the business plan so technology actively supports the
operators’ strategic ambitions.”
This approach reflects the undeniable truth that the world is becoming more
complex – and so is our industry. Big data is no longer news, people run their lives
through phone apps, and system integrations and APIs mean that businesses
expect their technology to communicate freely with others’.
We can no longer expect staff to be beholden to centralized, head office systems
that they have to log in to from a desktop PC, while remembering which of their
dozen different passwords to type. Unit managers prefer phone or tablet apps
that they carry with them, and are keen to try new technologies that could deliver
a competitive edge. Employees expect their roles to be enhanced by technology.
They see continuous innovation all around them and see no reason why it
shouldn’t also play a major part in helping them do their job even better.
Where Do You Start?
Define the business strategy, and map out the operations and finance roles within
this. Work out what technology is in use already, and map out what technology
links to what. Differentiate between ‘bedrock’ technology that underpins stable,
core business processes (e.g. systems that control cost and manage people and
provide data security) and more experimental technology, the latest ‘shiny new’
apps that sit on top of it.
This big picture approach will provide the perfect starting point. It will show where
the gaps are, and what technology is required to bring it all together in order not
just to provide better data, but crucially, interpret it in context to draw meaningful
“My main piece of advice is to keep it simple,” says Christian Berthelsen. “Get the
foundations right first. Once you have a solid technical platform, you can try new
However, a single-vendor approach doesn’t work. No one supplier can deliver
everything: POS, back-office, finance, booking systems and more. Instead,
operators should use best-of-breed vendors to form a stable backbone. Only then
can they effectively address issues such as single sign on (SSO) user identification
and authentication, and BYOD (bring your own device).
“Talk to your core vendors and put them to work (ideally for free) — and
collaborate with each other,” says Christian Berthelsen. “However, remember to
establish clear ownership — so everyone knows who is responsible for what data
and which integrations.”
Hospitality is a highly competitive business and the winners will be those
operators who can manage costs well, while attracting the best staff and enough
profitable customers. Underpinning this is a digital transformation strategy that
takes a holistic view.
By automating where it makes sense and using the power of diverse data streams
to generate valuable insights, they can improve the customer and employee
experience, increase efficiency and maximize profits.
“It’s time for IT specialists to take their rightful place in the business,” says
Christian Berthelsen. “They should start by agreeing to a three to five year vision
that encompasses both commercial and technological objectives. They should
challenge their suppliers to work together and find the right solutions. They should
prioritize their investment, set aside time and resources, and lay solid foundations.
This will give them the opportunity to innovate, experiment and, of course,
sometimes fail. But doing the same old stuff isn’t an option. Tomorrow’s pioneers
will be those who use technology to seize the opportunities that lie ahead.”
• Process and financial efficiency.
• Staff effectiveness.
• No duplication of effort.
• Automation of routine tasks, so staff can focus
• Data only entered once.
• Employees working with an intuitive system.
• Less paper, which saves money and is good for
• AI or machine learning to accurately forecast
sales, schedule staff and manage procurement.
Technology as an Enabler:
Questions to Ask Yourself
• How does our technology support our business goals?
• Will a single data hub make us more profitable?
• What’s our ROI on technology investment?
• What else can we automate?
• Can we link all our data to make one meaningful, reliable picture?
• Will having a single hub reduce the number of logins?
• How can we streamline our business?
• Do our departments get the data they need?
• How does our existing technology help us
provide the best customer service?
• Does it get people out of the back office
and in front of customers?
• Is it mobile, practical and easy to use?
Frank Bandura, Group CFO Gaucho
(formerly of Carluccio’s)
“20 years ago, the single-vendor model worked. Today it’s neither possible nor desirable.
“We are gene