The Benefits of Automation You Can Do More Thank You Think With Less Than You Have

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October 26, 2020
Analytics
Kelly McGuire
RaghawPuranmakla

TECHNOLOGY INNOVATIONS HAVE COME INTO FOCUS IN RECENT MONTHS, as hospitality struggles to cope with the pressures of the pandemic.

 A lot of attention has rightfully been focused on technology that directly addresses consequences of the pandemic. For example, many hospitality companies have accelerated development of any technology that facilitates contactless service processes. Digital investments that provide a connection to consumers when social distancing is enforced have also been prioritized. Companies that never had a digital presence have been forced online as brick and mortar storefronts were closed. Traditional B-to-B companies even pivoted to direct-to-consumer relationships when they lost the opportunity to build consumer awareness in the physical world. In fact, Microsoft CEO Satya Nadella said on a recent earnings call, “We’ve seen two years’ worth of digital transformation in two months.”

This digital transformation is probably long overdue and will certainly reap benefits for the companies that were able to pivot long after the impact of the pandemic is past. By this point, most of these initiatives are well underway and the dust is (thank goodness) settling on the initial crisis. However, there are still follow-on challenges to be solved. By now, most hospitality companies have drastically cut back on staffing. Most departments are probably at bare bones or worse. Critical activities have been prioritized as much as possible, but leaders are rightfully concerned about what they might be missing. When humans are in this short supply, any attention paid to non-value-added activities is even more counterproductive. Humans need to be laser focused on tasks that move the business forward, and specifically on tasks that they are uniquely qualified for. I’ve used this analogy before, but it’s worth repeating. Recall that Luke Skywalker relied on R2D2’s support in the routine tasks involved in piloting the X-Wing fighter. He needed that droid support so he could stay laser focused on using the force, his unique skill, to take down the Death Star. If he had been distracted by piloting the ship as well, the entire franchise would have ended right there. Imagine being deprived of Empire Strikes Back or Return of the Jedi! Sci-fi references aside, you see my point. With reductions in headcount and limited resources, hospitality companies would benefit tremendously from technology solutions that help to automate routine processes, freeing valuable time for more strategic, or “human judgement” centric tasks. If you start looking, you would likely be shocked at how many tasks you and your team spend time on that are necessary, but don’t really move the business forward.

The origins of this issue are not surprising. It’s no secret that hospitality is burdened with a huge amount of legacy systems, critical to operations, but requiring a good deal of manual intervention to operate. Decades ago, when these systems were first implemented, tenuous custom integrations with manual data movement and a lot of human intervention was the best that could be done to get the systems to work together to get the work done. Even still, this was an improvement on the prior fully manual environment. Fast forward to today, much of this mission-critical legacy technology is still in place, so even with more sophisticated components alongside, these manual processes persist by necessity. Extending outside the company, partners also operate on legacy systems, creating even more manual work to form connections and update data.

There are highly manual, highly repetitive processes throughout the hospitality organization. It’s easy to think that there’s no way around this mess, at least without swapping out these legacy systems and processes, which is an expensive and risky proposition. In fact, it is possible to automate without disrupting the current ecosystem. The good news is that a technology wrapper can easily be placed around the existing technology stack, which facilitates automation without replacing any of the core processes. This wrapper replicates the manual aspects of the process exactly as a human would execute them. This technique is known as robotic process automation, or RPA. 

WHAT IS RPA?
The simplest form of RPA automates a workflow by performing the actions on a computer screen just like a human would perform them. Think of this as a giant macro that replicates the actions of the humans involved in the process. Activities that happen in a workflow include things like pushing buttons to update data, copy/pasting information, kicking off data transfer processes, copying data from a spreadsheet into a system, generating emails or moving files from one location to another. Unlike a typical macro, however, RPA is incredibly robust and works across different tools and systems. For example, a large hospitality company recently used RPA to automate the annual process of uploading contract rates from negotiation platforms like Lanyon into selling systems like GDS, a task previously completed by 30 people.

WHAT IS IPA?
Intelligent Process Automation (IPA) extends RPA by leveraging advances in artificial intelligence and machine learning to automate routine tasks that require human judgement. These types of activities include reading documents and emails and extracting key data, reviewing and captioning images, answering phone calls and responding to texts or chat. Automating responses to reservation requests via email or responding to routine group or transient RFPs or tagging images are examples of routine hospitality activities that could be automated through IPA.

AUTOMATION WITH ANALYTICS
RPA and IPA exactly replicate human behavior, either workflow-oriented process activities or activities that require human judgement, but that are relatively routine in nature. Analytical solutions can extend beyond human knowledge or capabilities, automating processes that are highly complex. Because the analytics can rapidly process huge volumes of data, these systems can identify opportunities or patterns that humans would be unable to find either due to the complexity of the problem, or the volume of information. For example, hotels must have a price for each product for sale across the booking horizon (usually one year). While humans can certainly use their experience, supported by data, to set prices, they can only do so for a subset of dates at any given time, and with the amount of data they are able to synthesize manually. The complexity of market dynamics and the volume of decisions that must be made make it impossible to keep up with all pricing opportunities across the booking horizon manually. Humans can also have (unintentional) bias or predispositions when it comes to pricing, especially if they have a good deal of experience in market. The system only sees what the data tells it, and therefore, can find signals humans might overlook or disregard. 

BENEFITS
The primary benefit of all of these techniques is to eliminate manual work, which provides the opportunity to either reduce staff or to redeploy existing staff to higher value tasks that cannot be easily replicated by a machine. Automation also ensures that the work is performed consistently each time. This means fewer human errors, saving time and potentially driving revenue. 


These solutions are surprisingly accessible both in terms of price and level of effort to implement.
Here’s how to get started:

Identify areas to be automated.
Look for multi-step processes that require human intervention to move forward, or repetitive tasks that happen in high volume. Likely your distribution, customer support and billing environments have a bunch of these activities.

Carefully review the process.
Ask yourself what critical functions it enables. You may be surprised how many manual activities are performed out of routine rather than need. Also determine how much time and resources are saved via automation. Establish priorities for the order of automation. This way, with limited budgets, you can ensure you’ve picked a high value area first and can use that success to justify other projects.

Make sure you know what you need.
At a high level, understand which of the three categories of automation described in this article your selected process requires. Workflow automation is the most straightforward of the three. In general, as you increase the analytical needs required to execute, you start to add development and implementation costs and time. You also need to be sure to pick a partner that has expertise and experience in advanced analytics, AI and machine learning.

Obviously, the partner you choose to work with can help you with this, but you should at least have an idea what you will need ahead of time. The only thing certain is that the recovery will be slower and more volatile than we had hoped several months ago – in fact, things are likely to look completely different when this article is published than they did while I was writing it in mid-August. Automation can help you to ensure you are taking care of routine tasks, and still reserving sufficient bandwidth to identify opportunities and drive the business forward.

Additionally, with this degree of uncertainty, the responsible course is to be extremely conservative in adding headcount as demand returns. By automating some key processes, you can shore up the existing team, and hold out a bit longer before having to make decisions about bringing people back. Automation will ensure you enter the new normal best positioned to add the resources that will contribute to ongoing success. 


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