Disruptive Technology and Innovation in Australian Hotel and Hospitality Industry
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This report analyzes the impact, role, and future trends of disruptive technology and innovation in the Australian hotel and hospitality industry. It discusses the use of disruptive technology in the industry, its positive and negative impacts, and future trends in the industry.
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Running Head: ENTREPRENEURSHIP1 Entrepreneurship for Hospitality Leaders
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ENTREPRENEURSHIP2 Table of Contents Introduction.................................................................................................................................................3 Australian Hotel and Hospitality Industry....................................................................................................3 Impact of Disruptive Innovation in Australian Hotel and Hospitality Industry.............................................4 Role of Disruptive Technology in Australian Hotel and Hospitality Industry...............................................6 Future Trends of Technology Innovation in Australian Hotel and Hospitality Industry...............................7 Conclusion...................................................................................................................................................9
ENTREPRENEURSHIP3 Introduction The global hotel and hospitality sector is changing at an extremely rapid speed with n/ew and innovative trends, products and services keep developing constantly. However, some of them sad value to the hospitality industry, but some can be disruptive, specifically to the traditional players in the industry (Dredge, Airey & Gross, 2014). The major objective of this report is to discuss about the use of disruptive technology and innovation in hospitality industry in Australia. Disruptive technology refers to the developed and enhanced technology which changes and disrupts the current technology. It assists a business to increase value of its offerings. As the disruptive technology is new to the business so it has curtained benefits, developments and functionalities over competing brands. In today’s competitive business environment, hospitality organizations need to adopt and implement modern technologies in their routine operations so that they can provide higher level of customer satisfaction. Considering the importance of disruptive technology, this report is totally focused on analyzing the effect, role and future trends of disruptive technology in hotel and hospitality industry of Australia. In past few decades, Australianhospitalityindustryhasexperiencedsignificantgrowthresultinginenhanced competition on international level. Australian Hotel and Hospitality IndustryOverview Hotel and hospitality industry is one of the major contributors to the Australian economy. According to a report, it can be stated that Australian hospitality industry comprises around 4500 hotels and motels with more than 225,000 rooms. Currently, this sector is generating significant revenues due to development of tourism in the country. In the future, it is expecting to approach $167 billion by the year 2025. There is an increase in tourism staying rate due to growth of tourist arrival from China (Newsroom, 2015). Additionally, another reason is that Australian hotel and hospitality industry is making huge investment in using modern and innovative technologies so that hotels can offer best hospitality services to their customers. Australian hotels prefer to implement digital products and innovative technologies so that they can engage their guests in hospitality practices and enhance their repeat intention towards their services (Xu & Gursoy, 2015). Implementation of disruptive technology has a huge impact on the Australian hotel and hospitality industry which are discussed below:
ENTREPRENEURSHIP4 Impact of Disruptive Innovation in Australian Hotel and Hospitality Industry The hotel and hospitality industry in Australia is fiercely competitive. The rise of craft beer, quality food, unique customer experiences and convenience have emerged a race in this industry. With the increase in the standards, rivalry has spread on other aspects and offerings, associated with the revenue increment, social media and venue technology. Looking at the growth of Australian hotel sector, it can be stated that this industry is focusing on using the modern technologies and high-tech products which assist the organizations to increase their profitability. This is the sector that uses disruptive technology and innovation which assist the hotels to attract more customers and retain them. There are various organizations in hospitality industry which are using different disruptive technologies in its routine activities. Some of the organizations such as Hilton Hotels, Four Points by Sheraton, Marriott, Grand Hyatt, Novotel Sydney Darling Harbour etc. use disruptive technologies to attract a large customer base and get success in global hospitality industry (McLaughlin, 2015). By conducting a research, it can be noted that Australian hotels are making changes in their processes and routine activities by using effective technologies. Online Travel Agents (OTA) are considered one of the major forms of disruptive innovation in Australian hospitality industry. Online Travel Agents are the most successful service operations which operate on World Wide Web. It includes Expedia Australia, Wotif.com and Lastminute.com that are among major Online Travel Agencies in Australian hotel sector. They assist the travellers to get easy access to reservations at hotels and resorts. The introduction of OTA has a great impact on Australian hospitality and hotel sector. It operations presented price transparency in this sector for first time. The customers are now able to find the available rooms and room rates at hotels in Australian market. This innovation in Australian hotel industry had a financially expensive and disruptive impact on the hotels (Fridman, 2018). In Australia, most of the tourists travel from Chinese states. Thus, the person from China can book their hotels using the services of OTAs. In addition to above, one of the common disruptive technologies in hospitality industry is Airbnb that provides a platform which enables the ordinary people to rent out their residential properties. This platform has emerged rapidly and disrupts the recent hospitality market by providing alternative advantages that over time can transfer and catch the majority of customers (Guttentag,
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ENTREPRENEURSHIP5 2015). As a disruptive service, Airbnb is renovating the market by providing the online platform to people who can rent or lease their accommodation for travellers to Australia. Furthermore, it performsdifferentadvantagesthatarecheaperand convenientthanconventionalleading organizations. However, Airbnb has become very popular but still it is illegal in various jurisdictions because of the regulation of short term rentals (Gomezelj, 2016). In addition to this, technology is a big tool which assists the hospitality organizations to start theirbusinessprocesses.Sameas,Australianhospitalitycompaniesutilizedisruptive technologies to safeguard their position in competitive industry. Social media plays an important role in Australian hotel and hospitality industry. Hotels in Australia are using social networking sites to attract and communicate with its targeted market segment. It has a major impact on the way the hotels communicate with their customers (Palacios-Marqués, Merigó & Soto-Acosta, 2015). There are various modes like e-mails, instant messaging, Facebook, Instagram, Twitter etc. Apart from above technologies, there are various websites and applications like Trivago which allow the customers to compare the hotel packages of different hotels. Thus, the disruptive technologies offer various opportunities to hospitality organizations so that they can increase their sales and share in international market. Apart from these positive impacts, the hotel and hospitality industry in Australia has some negative impact of disruptive technologies. It can cause cyber-attack to the organizations. The organizations may face the issue of data breach. It
ENTREPRENEURSHIP6 hasincreasedthecompetitionintheAustralianhospitalityindustryaseachandevery organization is making efforts by using modern technologies (Viglia, Pelloia & Buhalis, 2018). In this way, disruptive technologies have both positive and negative impacts on Australian hotel and hospitality industry. RoleofDisruptiveTechnologyinAustralianHotelandHospitality Industry Disruptive technology plays a critical role in the growth and development of hotel and hospitality industry of Australia. It can be noted that it plays an important role in increasing the business scope for different hospitality organizations. It has offered a higher satisfaction level to the targetedcustomers(Slåtten&Mehmetoglu,2015).Theorganizationsareusingmore technologies to meet the needs and expectations of customers. The major role of disruptive innovation in hotel industry is to offer easy access to the customers when they are going to live at different destinations. Social and digital media channels also assisted the organizations to promote their services all over the world. The role of disruptive technologies in Australian hotel industry is discussed below: To meet customers need and expectations In order to meet the challenge of increasing demands and expectations of customers, Australian hotel industry is turning to use advanced technology (Pechlaner & Innerhofer, 2016). This innovation will allow the hotel service providers to stay put from the competition and fulfill the expectations of guests. It can be seen that today’s generation is becoming very much tech savvy. Considering this fact, hotels prefer to use updated technologies to meet their expectations. Transparency of Hotel prices As mentioned above, there are various applications and websites which display the actual prices of the hotel rooms. Trivago is the best example that shows the comparing prices of hotels from where the customers can select the services which they find more affordable according to their budget. For customers, this price transparency plays a significant role in getting the right prices off the services. Moreover, it reduces the average room rate because of intense competition.
ENTREPRENEURSHIP7 Effective communication with customers and employees Disruptive technologies play an important role in establishing communication with the customers and employees. Under this, hotels are using different social networking sites so that they can communicate their brand message to targeted market. For example, Chatbots are used to communicate with the people via chat interface. As the users spend a significant time on messaging applications so chatbots have a considerable potential in Australian hospitality industry (Palacios-Marqués, Merigó & Soto-Acosta, 2015). It helps the organization to find out the information about the customers and makes efforts to target accordingly. In addition to this, there are various leading hotels which are using technological advances and smartphone options to interact with employees and share the information with them. Firms like Airbnb have the potential to get the appropriate platforms to fit the requirements of their customers. It showcases what the hotels have to provide and get the customers’ feedback. Work Distribution By using advanced technologies and innovation, the hotels are able to gain the benefits by promoting their services in emerging markets. It has distributed the work and operations of Australian hotels in international market. It plays a vital role in generating the profits and revenues by working together. Thus, disruptive technologies play a significant role in the emergence of Hotel and Hospitality sector of Australia. FutureTrendsofTechnologyInnovationinAustralianHoteland Hospitality Industry Hotel and hospitality industry in Australia is going ahead by using various innovative features including disruptive technologies and innovation. In the future, technologies will be nurtured with the passage of time (Ryan, 2015). The future trends in disruptive technologies in Australian hotel industry are discussed below: Video Conference Facilities:
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ENTREPRENEURSHIP8 Looking at the enhancing the needs of business tourism, the hotels are focused to start on retaining the business professional segment in the industry. In the place of offering high speed Wi-Fi for conferences, now the hotels are aiming to offer the digital conference facilities and audio-visual facilities to business professionals (Marques, 2017). It will assist the organization to increase its customer base by adding business professional segment. Virtual Reality: In the Australian hospitality industry, virtual reality is one of the newest catchwords. The enhancing accessibility of virtual reality can develop new branding and marketing opportunities for the hospitality organizations. In the future, this trend in disruptive technologies can create the potential to offer innovative ways to engage with the customers. It can replace the use of traditional brochures (Tussyadiah, Wang, Jung & Dieck, 2018). Australian hotels can provide more interesting experiences such as VR presentations and 360° videos. Using these tools, hotels can provide a personalized experience of hotel. Thus, the hotels can use Virtual Reality as a marketing tool. Smart Keys It is a burden for the travellers to keep the key in their bag safely, so the hospitality organizations should use the smart keys for their hotel rooms to unlock the door. This advanced technological facility will assist the people to swipe their smartphone to open the room easily by processing hotel’s application. Moreover, it can use biometric facility which will eliminate the use of physical key at hotels. Infrared Sensors and Robots This technology is considered as one of the most refined and enticing technologies which assist the hotels in increasing the number of customers. In the future, the hospitality organizations can use the robotic services for routine work like food serving, house-keeping etc. Additionally, hotels can use infrared sensors to avoid the disturbance to customers. Hong-Kong is the country where hotels are using robots in their operations. In the future, Australian hotels can aalso use them to enhance artificial intelligence (Parsa & Narapareddy, 2015).
ENTREPRENEURSHIP9 Conclusion From the above analysis, it can be concluded that disruptive technology is the major contributor to the growth and success of hospitality industry in Australia. The organizations in this industry have enough potential to implement advanced and modern technologies so that they can fulfill the hospitality needs of modern customers. It has both positive and negative impact on the growth of industry. Moreover, the above paper stated that there are some future trends of disruptive technologies which Australian hotels can use to upgrade their service delivery processes. These trends will assist the organization to grow among competitors and contribute to the overall development of Australian hospitality industry.
ENTREPRENEURSHIP10 References Dredge, D., Airey, D., & Gross, M. J. (Eds.). (2014).The Routledge handbook of tourism and hospitality education. UK: Routledge. Fridman, A. (2018).3 Ways Technology Is Disrupting the Hospitality Industry.Retrieved from https://www.inc.com/adam-fridman/3-ways-technology-is-disrupting-the-hospitality- industry.html Gomezelj, D. O. (2016). A systematic review of research on innovation in hospitality and tourism.International Journal of Contemporary Hospitality Management,28(3), 516- 558. Guttentag,D. (2015). Airbnb: disruptive innovationand the rise of an informaltourism accommodation sector.Current issues in Tourism,18(12), 1192-1217. Marques, M. (2017).5 tech trends revolutionising the hospitality industry. Retrieved from https://medium.com/hijiffy/5-tech-trends-revolutionising-the-hospitality-industry- 76b734c961b7 McLaughlin, K. (2015).Australia's biggest hotels by number of rooms: The top 18 biggest. Retrievedfromhttp://www.traveller.com.au/australias-biggest-hotels-by-number-of- rooms-the-top-18-biggest-1muxg8 Newsroom.(2015).WhyAustralia'shospitalityindustryisbooming.Retrievedfrom https://www.hotelmanagement.net/transactions/why-australia-s-hospitality-industry- booming Palacios-Marqués, D., Merigó, J. M., & Soto-Acosta, P. (2015). Online social networks as an enabler of innovation in organizations.Management Decision,53(9), 1906-1920. Parsa, H. G., & Narapareddy, V. V. (Eds.). (2015).Sustainability, Social Responsibility, and Innovations in the Hospitality Industry. CRC Press. Pechlaner,H.,&Innerhofer,E.(2016).Competence-BasedInnovationinHospitalityand Tourism. Routledge.
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ENTREPRENEURSHIP11 Ryan, C. (2015). Trends in hospitality management research: a personal reflection.International Journal of Contemporary Hospitality Management,27(3), 340-361. Slåtten, T., & Mehmetoglu, M. (2015). The effects of transformational leadership and perceived creativity on innovation behavior in the hospitality industry.Journal of Human Resources in Hospitality & Tourism,14(2), 195-219. Tussyadiah, I. P., Wang, D., Jung, T. H., & Dieck, M. C. (2018). Virtual reality, presence, and attitude change: Empirical evidence from tourism.Tourism Management,66, 140-154. Viglia, G., Pelloia, M., & Buhalis, D. (2018). Information Technology in Hospitality Education. InInnovation in Hospitality Education(pp. 87-100). Springer, Cham. Xu, X., & Gursoy, D. (2015). Influence of sustainable hospitality supply chain management on customers’ attitudes and behaviors.International journal of hospitality management,49, 105-116.