The full day discussion, held in Paris at EURHOTEC 2001, the IH&RA�s annual European Hospitality Technology Show & Conference (19-21 February), was the second in a series of exclusive summits through which the association is establishing a leadership position in articulating a collective industry response to key issues impacting hospitality, with the goal of heightening its understanding and preparedness for the future.

Debate centred on the challenge confronting hospitality enterprises worldwide � how to persuade owners and management to make investments in technology. A strong consensus emerged that hotels and hotel companies� first concern must be to establish a sound business rationale for making technology investments and to link it to overall company strategy.

To make this happen, the Summit identified a key need to isolate the critical success factors that enable hotels to perform well in today�s technology environment in addition to industry-wide �value-drivers� � the elements of value that underpin the cost structure or revenue potential for tech-related investments. Currently there is a significant absence of any formal tracking or analysis of the value-drivers in the hospitality business on which the industry can rely.

Only when these are clearly identified will executives have the �tools� to make a compelling case to owners and institutional investors for the substantial capital outlays required to underwrite not just the hardware and software but the myriad costs relating to technology�s installation and utilization in a coherent fashion across the hospitality entreprise. 

The group acknowledged that hospitality chief executives also had to be persuaded of the value of technology investments in light of the tendency in the past for tech benefits to be �over-promised and under-delivered�. The need to establish trust and credibility was fundamental and could only be achieved by presenting the business case linking investment to value-drivers. � There is no such thing as tech project: there are only business projects that use technology, � was how one participant summed it up.

Assessing critical success factors and identifying the value-drivers is the key and the IH&RA will be formulating a research strategy to address this,� affirmed Prof. Michael Olsen, IH&RA director of research and professor of strategic hospitality management at Virginia Tech, the discussion facilitator. � That�s what leadership is all about � taking people where they haven�t been before. �

Among further crucial dimensions to �telling the story� � presenting a convincing case for investment to all stakeholders � participants identified the following:

• Confidence that the investment will generate growth, not just cash-flow 
• The perception that technology will create a sustainable advantage 
• The assurance that technology will not dilute earnings streams 
• Understanding the �lost opportunity cost� of not making the investment Conveying the timing issues such as how long forecasted ROI will take to materialise.