Converged CRS And PMS Are Finally Here! Now What?
By George Roukas, Partner at Hudson Crossing
Much has been written recently about the convergence of central reservation systems and property management systems. There are two reasons for all the writing: first, because it represents such an improvement in how hotels process their bookings and manage stays, and second because we've been waiting for over a quarter century for these converged systems to appear. Now that it looks like convergence is finally going to happen, let's consider its context and look ahead to convergence's wider implications:
- Convergence is primarily enabled by cloud computing technology, which will enable lots of other things we've wanted to do for a long time
- Convergence won't stop with CRS and PMS—it will allow companies with RMS, CRM, and other systems to converge those applications as well
- Tech suppliers who develop these converged, cloud native systems intelligently, with wellstructured and fully documented APIs connected to well-designed underlying microservices, will create hospitality technology platforms that can serve many kinds of applications - all using the platform's common services and data structures. (That's a mouthful, but we'll break it down later on.)
- Some vendors will evolve their platforms into full-fledged ecosystems that support applications from multiple (and often competing) vendors; this will be a very good thing for almost everybody, but especially for hotels
- As the ecosystems build, traditional applications will decompose into separable modules that can be assembled like Lego blocks to create functionality to address what each hotel, group and chain may need to differentiate their offerings to guests.
By the time we get to step 5, hotel technology will have more in common with smart phones and app stores than with today's hotel technology applications. Hotel technology will evolve from separate applications to platforms and eventually to ecosystems running discrete capabilities.
Convergence is primarily enabled by cloud computing technology, which will enable lots of other things we've wanted to do for a long time
The same technologies enabling us to achieve converged CRS/PMS systems will continue to push us forward beyond convergence, and understanding that end game is critical to making the right choices now. This time around, the future is coming fast whether we're ready or not, and it's creating a new playing field where past leaders might be pushed aside to make room for new entrants.
Back in the 90's when we first heard promises of converged systems, we understood the problems they could solve (consistency, security, speed, etc.) and we waited with great anticipation for the day of their delivery. And waited. And waited. It's not as though the software companies didn't want to deliver, it just turned out to be much harder than they thought. Some of the early attempts didn't scale well, and the idea of scaling vertically by buying ever-larger machines seemed like too much work and way too much cost.
Then Amazon, Azure, Google, and Alibaba's clouds appeared, and cloud-native applications based on micro-service designs started popping up. Cloud computing allows you to scale up and down as much as you like, and only pay for what you use. Play by cloud rules and you could offload many of the technical challenges of enterprise applications1 to someone else who was really good at it. By the way, the cloud companies were also very good at something that most other companies aren't: artificial intelligence. AWS, Google, and Microsoft all include AI primitives with their environments. And they're much better at AI than you are and likely ever will be. Does someone like Google's AI lead Jeff Dean or Stanford's Andrew Ng come to work at your company in the morning? Didn't think so--they're better at AI.