Head for the cloud Astute multi-site operators are investing sensibly in technology to access the controls they need to compete in an increasingly tough market, says Intelligent Business Systems managing director Gareth Powell
lthough we’re more than halfway through the year at the time of writing, 2017 has already seen two major technology stories grab the mainstream media headlines for all the wrong reasons. These stories can threaten our faith in technology yet, at the same time, we can’t really carry out effective business without fully embracing the controls that the digital revolution has supplied us with during the past five to ten years. Ransomware attacks are a truly global phenomenon, attacking vulnerable computer systems from Ukraine and the US to Austria and Australia. Unfortunately, despite the chaos they cause they will be with us for the foreseeable future until businesses and organisations ensure their software has all the necessary up-to-date protections in place. As an example, one attack – dubbed WannaCry – crippled much of the NHS with the BBC reporting about 40 departments had to cancel operations and appointments in May.
“Controlling a business through the clever deployment of IT has long-term financial benefits that far outweigh short-term considerations” Unrelated, but equally dramatic, was the grounding of more than 1,200 British Airways flights during three days in the same month. This story caught my eye not only because I am a frequent flyer but the fact many lessons learned from the debacle apply to other markets, including the hospitality sector. British Airways chief executive Alex Cruz quickly linked the computer failure to a “power-supply issue”. However, as a brilliant editorial in a June edition of The Economist pointed out, this was a £150m cost-cutting catastrophe of its own making, the fourth time in a year BA’s computer systems had crashed.
Key lessons from the BA debacle The Economist’s leader article highlighted three key lessons applicable to BA and any other business reliant on technology and IT. First, investing in IT should be seen as a cost of doing business rather than an overhead. Second, back-up systems should be tested regularly. Third, contingency plans need to be in place to counter IT faults when they happen. The article wisely concluded that slashing spending on IT systems was a false economy, both in terms of passenger compensation and the damage to BA’s reputation. These lessons have been front-of-mind when I’ve talked to a number of large multi-site hospitality operators in recent months. Fortunately, they are astute and clearly on a different road map to Cruz and understand how IT systems, and the procedures embedded around them, are the backbone of their business. As we all know, investing in IT has to be a considered decision based on a thorough examination of what’s on offer within the technology market. My biggest takeaway from the conversations I had is these operators fully understand the importance of investing sensibly in technology in order to access the business controls they need to compete in an increasingly tough market. Although price is still an important factor, it is not the key driver. Controlling a business through the clever deployment of IT has long-term financial benefits that far outweigh short-term considerations.
Visionary operators The lessons highlighted by The Economist are very much part of our conversation to ensure these businesses have contingencies in place to avoid possible IT meltdowns. As visionary operators, they see EPOS-based hospitality management systems as a means of reducing costs, improving margins and engaging with guests as opposed to an unwelcome discretionary expense they can cut at will to temporarily improve the bottom line. That’s why they are chatting to us – we tick all the right boxes associated with a modern EPOS-based technology solutions business. They appreciate we had the foresight to invest heavily in the cloud eight years ago. As an example of the benefits of operating exclusively in the cloud, we can update and upgrade our software and systems without interrupting a client’s normal trading hours. Updates can be carried out at the client’s convenience rather than ours, usually within a matter of hours or days depending on the urgency of the situation. Many of our competitors with so-called “web-based” systems can only update front-of-house and back-of-house systems by shutting them down completely while they upload new data, a process that can take a day or so to complete. Similarly, they can only schedule and carry out time-consuming software upgrades on a quarterly or bi-annual basis. From my perspective, this reliance on out-of-date technology is a bit like trying to operate a successful business with one hand behind your back and your shoelaces tied together.
Everyday disciplines Our industry is constantly changing. We all have to forecast what’s going to happen in the future in a multi-disciplinary world that has moved way beyond the original scope of EPOS systems to not only record and track cash and stock movements and waste but also non-sale items such as crockery, cutlery, cleaning materials and staff uniforms. These and many other daily trackers now form a standard part of these everyday disciplines. The large multi-site operators I talked to feel the same way and are seeking technology systems that can seamlessly share these new data sources and give them the freedom to add popular apps and mobile-friendly website data as and when they want. Tomorrow’s apps are a still a twinkle in a young developer’s eye but in a few years time they will change the way we communicate with each other and share information. However, when they do come to market, we want to be able to link up immediately rather than make vague promises that we’ll do so in six months time. Obviously we anticipated this when we moved to the cloud and we currently link to and share data with more than 30 powerful and popular apps because of our intelligent deployment of API technology. We can quickly and easily add more apps to meet the future demands of the hospitality sector. These are the sorts of controls I like as a technology expert. More importantly, multi-site operators like them too.
Gareth Powell, is managing director of Intelligent Business Systems – www.ibs-systems.co.uk
PROPEL QUARTERLY ¡ AUTUMN 2017 ¡ www.propelhospitality.com