News for the Hospitality Executive
RTM Asks: Are You Reaping Returns, Results from
Your Outsourced Technology Partner?
Reducing corporate overhead by outsourcing specialty areas is a great way
to save time and money – But can you measure the results?
|By Terry Mueller, October 28, 2008
Due to the economic slow down, many hotels are forecasting a decline in 2009 revenue. Therefore, more than ever before, owners and management companies need to implement cost-saving strategies to reduce corporate and property overhead – especially when expertise in specific job functions and time to perform related tasks is lacking.
Outsourcing specialty areas – such as hotel Internet- / guest-support services, telecom cost-optimization services, eCommerce management, revenue management, and HDTV upgrade project management – is a great place to start. In order to reap a true return on this investment however, it is imperative that owners and managers hold the outsourced partner accountable and pre-establish strategic guidelines to track progress and results.
I’m certainly not suggesting that we outsource these jobs to overseas operations. Too many call-center and accounts-payable support groups have already moved in that direction – and customer service is suffering, giving hospitality a black eye!
As management companies reduce corporate overhead, an outsourcing team can achieve measurable results with a modest expense to the property. The property gains an experienced, task-oriented team of true experts at a fraction of the cost while achieving a higher rate on return for the investment.
When building new hotels, the McKibbon Hotel Group outsources the project-management of its low-voltage infrastructure, such as cabling for telecommunications, cable television, high-speed Internet and closed circuit TV, to Resource Technology Management, a company that has provided hospitality-specific technology consulting and management services for more than 15 years.
With 150 years of collective hospitality industry experience, this professional team keeps the development group abreast of the ever-changing technology platform, makes big-picture investment recommendations by identifying the right technologies for each brand in the company’s portfolio, and implements the right network infrastructure to support future technology requirements of the hotel’s guests and staff.
For example, too much cabling can kill a project’s ROI, and too little can cripple the facility for future growth. Based on years of expertise, McKibbon’s outsource partner builds the infrastructure of its hotels correctly from the start, and in return it pays huge long-term dividends.
Likewise, Driftwood Hospitality Management boasts a proven track record in all aspects of the hospitality business, including Internet distribution and eMarketing. The hotel attributes its success in part to outsourcing its HSIA, eMarketing and HDTV-conversion services also to RTM. Through this partnership, Driftwood’s brand.com websites exceed year over year brand averages and provides a high and measurable ROI.
Driftwood properties have improved their high-speed guest service scores by using a US based call center. The company is outsourcing the HDTV conversion to gain unique expertise to the implement the best and most cost affective solution for their hotels. Implementing the Brand’s HDTV requirements is an extremely time consuming and complex issue.
Driftwood also is focused on maximizing revenues and reservations via the various distribution channels. RTM also channels traditional marketing expenditures for yellow pages, directories and business travel into a wide range of e-commerce initiatives. As such, Driftwood has expanded its presence on the Internet from grass-roots level to its overall image while ensuring compliance with all franchise guidelines.
Expertise = ROI
While most of the major brands have excellent eCommerce tools, a much larger ROI can always be achieved by optimizing the property’s Brand Webpages. Unfortunately for the hotel companies – and their properties – the lack of manpower and/or expertise may be stifling ROI potential.
Here’s where outsourcing really makes “cents.” Expertise does not have to be expensive. Many companies charge a few hundred dollars per month to perform outsourced project-management and technology-consulting services. And, by holding the outsourced partner accountable and requiring them to track and measure results, hotel companies are finding that double- and triple-digit returns are easily achievable on their investment.
Some outsource partners, such as RTM, have been able to achieve a ROI from 10 times to 30 times of the fees.
There is a secret to the success in achieving these outstanding ROI results:
1. Treat your outsource partner as an associateA true partnership is not based on an adversarial relationship. Working together to meet a common goal will always result in greater success.
Terry Mueller is CEO of Resource Technology Management, an outsourced technology-consulting and project-management company. Visit www.rtm-inc.com.
|Also See:||Driftwood Hospitality Salutes RTM for Managing HSIA, eMarketing and HDTV; Expert in outsourced technology consulting and management delivers actionable results and cost savings to owner/operator of 44 hotels; Through RTM, Driftwood's brand.com websites exceed year over year brand averages and provides a high ROI / September 2008|
|Resource Technology Management Asks: Are You Tuned-In to HDTV? Expert in outsourced technology consulting and management helps hotels convert from traditional TVs to high-definition flat screens to meet brand standards and remain competitive in the market / August 2008|