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?
Chief Technology Officer at Red Planet Hotels
This is definitely a divisive topic within hoteliers and extremely subjective - so what follows is my personal view: Buy what you can, build what you can't. If a product/service/platform is commoditized to the point that there are various providers in the market, it's unlikely (not impossible) that hoteliers will be able to add value by building that particular piece of technology. That's not to say that a well thought out technology platform that is 100% tailored to the operations of a particular business won't do well - however, most hotel companies are not structured to successfully build that kind of tech.
Competitive advantage cannot be bought - and this is where I advocate building. At Red Planet, we chose to build our own middleware layer to connect disparate systems because we alone know how, where, and why data needs to move. In certain areas, we have not successfully commoditized technology due to such a varied set of requirements across companies.
However, before embarking on a journey to build tech, tech leaders must build awareness and get buy-in from the organization on the work involved. When you build tech, you are actually responsible for maintaining and growing that piece of technology for as long as you use it. A tech platform is never "done" and building any tech means committing the organization to the long-term upkeep of that tech.