Travel and Hospitality

The travel and hospitality industry includes a broad range of companies: tour operators, travel consolidators, tourist boards, airlines, cruise lines, railroads, private transportation providers, car rental services, hotels, resorts, lodging, restaurants and other real-estate intensive consumer businesses. The industry is characterized by a high level of personal service to customers with a diversified supply chain of suppliers of food, fuel, telecom, construction, facilities maintenance, marketing and customer support.

Airlines. The airline industry constitutes a complex network of interactions between travelers, consolidators, suppliers, maintenance providers, call centers, web services and equipment manufacturers. Airlines have hired outsourcers for limited functions that have high levels of detail and high volumes, such as inter-line passenger revenue accounting, credit card transactions. Since the customer relationship is the key to profitabilitiy, the airlines became more competitive, and focused more on software development and customer service, after the online aggregators (“meta-apps”) such as Expedia, Orbitz and Travelocity, and the price-shopper sites like Priceline and Kayak.com, exposed them to comparative shopping experiences. So the airlines have been licensing global distribution systems (“GDS”) from a few large IT services companies to achieve efficiencies, competitiveness, speed and interconnectivity in reservations, bookings and online ticket issuance. Their IT-intensive environment benefits from data warehousing and customer segmentation, including generation of custom websites for affinity groups and individualized customer experiences.

Hospitality Industry: Hotels, Restaurants. The hotel industry competes across borders, serving a multi-lingual, multi-cultural clientele that demands personal attention. There are several paradigms that can be used, depending on the level of sophistication and globalization of the particular enterprise.

In a basic sourcing paradigm, captives, shared-service centers and outsourcing in the hotel business has already begun in labor-intensive back-office and customer support services, including:

  1. 24/7 global reservation centers
  2. customer helpdesk
  3. outbound sales support
  4. customer loyalty programs, including "frequent guest" and co-branded program management
  5. supply chain management in procurement and logistics.

Beyond such labor intensive operations, the hospitality industry as pushed into a more productivity-focused paradigm. In this paradigm, global sourcing becomes a tool for improved performance and competitiveness through improved efficiency, flexibility and adaptability to fluctuations in market demand. Industry-specific service offerings in both software and services have emerged as global services providers emerge across national boundaries to service globalizing businesses with specific vertical service solutions and end-to-end business processes within the hotel and hospitality industry, such as:

  1. Finance and accounting
  2. Real estate facilities management
  3. Inventory and asset management
  4. Human resource administration, including recruitment process outsourcing, HR compliance and pension and benefits administration
  5. Marketing and customer service, including definition and standardization of complex hospitality-unique processes that focus on the customer experience.
  6. Market research and analytics
  7. Business intelligence
  8. Knowledge management

Regardless of the level of captive services, shared services or outsourcing, the key competitive competencies will remain business planning, brand management and customer care.