Should hoteliers develop in-house or outsource IT applications and solutions?
— 19 experts shared their view
Some hoteliers (brands & management companies) believe that developing tech solutions in-house is cheaper and provides better customization to the hotelier's concrete needs and control over the ongoing maintenance and performance. Another school of industry-thought believes that hoteliers should focus on their core competencies: providing the best customer experience and best returns possible to ownership and outsource technology applications, products and solutions to specialized vendors.
So the question is, in this era of rapid technological advancements and adoption of next-gen technologies such as AI, IoT, automation, robotics, blockchain, etc., should hoteliers keep technology developments in-house or outsource to specialized, well-funded vendors?
Board Member, HFTP
I have a strong buy preference personally, however, there are many factors needing consideration before the buy v build decision can be made.
- is this a strategic tool? Does it drive differentiation with your competitive set?
- does it directly drive a top-/bottom-line result?
- will you have the best tools, architecture, and innovation?
- what will modernization and support efforts look like in three years? Is that the best use of your limited capital?
- what's the ideation to run lag time? Is there an alternative product or service that is better/faster/easier/more functional to deploy and manage?
- are you suffering from the Ikea effect?
There are many more questions that come to mind, but in the end, hospitality is about providing superior guest service. By buying technology and tech services, when combined with smart contracting, you are generally able to leverage and benefit from the collective input from the suppliers, drive greater predictability in managing your costs, and retain a degree of flexibility for the future.