A technology adoption and implementation process in an independent hotel chain

International Journal of Hospitality Management 57 (2016) 93–105
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International Journal of Hospitality Management
j o u r n a l h o m e p a g e : w w w . e l s e v i e r . c o m / l o c a t e / i j h o s m a n A technology adoption and implementation process in anindependent hotel chainLiza M. Cobos ∗, Cynthia Mejia, Ahmet Bulent Ozturk, Youcheng WangRosen College of Hospitality Management, University of Central Florida, Orlando, FL, USAa r t i c l e i n f oArticle history:Received 18 November 2015Received in revised form 2 May 2016Accepted 14 June 2016Keywords:Innovations adoptionHotelRadio frequency identification (RFID)technologyElectronic locking systemsVendor co-creationLeader influencea b s t r a c tSuccessful technological initiatives in the hospitality industry are a product of a well-planned and exe-cuted innovation adoption process. This qualitative study investigated the adoption of radio frequencyidentification (RFID) enabled locking technology in an independent hospitality company as a mechanismfor service innovation and improved internal process efficiency. Findings from the research generatedthemes significantly impacting the knowledge and persuasion stages of the diffusion of innovations (DOI)adoption process. Results produced theoretical implications which suggest the dual nature of adoptionprocess in the service industries, as well as practical recommendations for the implementation of newtechnologies in the hospitality industry.© 2016 Elsevier Ltd. All rights reserved.1. IntroductionPrior research has demonstrated that in addition to convenienceand service, safety and security are the most important factorscustomers consider when booking a room (Chan and Lam, 2013;Knutson, 1988; Milman et al., 1999) or planning an event at a hotel(Hilliard and Baloglu, 2008). Previous literature suggests that safetyand security is a determinant factor in site and destination selec-tion since meeting planners must consider not only the safety of theattendees but also of their equipment and materials (Oppermann,1996; DiPietro et al., 2008). In addition, hotel safety and secu-rity features have been shown to increase guests’ satisfaction andreturn intentions (Prasad et al., 2014). To ensure guests’ security,hotel firms have utilized various methods and systems, and elec-tronic locking systems (ELS) have dominated hotel security overthe past three decades. However, due to a recent security breachfrom one of the largest electronic door locking companies, ELS effec-tiveness has been called into question, and hotels across the globehave begun to investigate alternative security measures on behalfof their guests’ safety and security (Byrne, n.d.).In July 2012, CBS News released a story from the Black HatUSA security conference held in Las Vegas, Nevada (Ngak, 2012).Demonstrated at the conference was a US$50 device which had the∗ Corresponding author.E-mail addresses: [e-mail] (L.M. Cobos),[e-mail] (C. Mejia), [e-mail] (A.B. Ozturk),[e-mail] (Y. Wang).capability to unlock a hotel door wherever Onity locking systemswere installed, compromising an estimated 4 million hotel roomsworldwide (Musil, 2012; Ngak, 2012). The Onity locking systemutilized a magnetic strip “card key” resembling a credit card, whichwas the standard of the hotel industry at the time. After this newsbecame widely available, hoteliers around the world faced the con-sequences of knowing the potential harm this could bring to theirguests, employees, and brand. In response to this highly publicizedevent, RFID technology has materialized as a reliable safety andsecurity technological innovation for controlling access in hotelsand resorts (Ngak, 2012).In general, RFID technology can be defined as a communica-tion technology which uses short-range radio waves for automaticidentification and data exchange (Roberts, 2006). Potential RFIDcommunications might include displaying information in a Pointof Sales System, creating an inventory database, or processing apayment transaction (Öztays ̧ i et al., 2009). RFID technology wasinitially commercialized by retail companies (e.g., Wal-Mart) toenhance efficiencies in the supply chain and as RFID equipmentcosts decreased, more customer-facing applications have emergedacross industries and settings including cashless payment sys-tems, toll collection, library book tracking, race timing, conferenceattendee tracking, and electronic locking systems (Borriello, 2005;Ozturk et al., 2012; Roberts, 2006).RFID technology innovation research has attracted significantattention among academics outside the hospitality discipline andseveral theoretical models have been developed to examine RFIDtechnology adoption in different settings and industries (Whitaker
http://dx.doi.org/10.1016/j.ijhm.2016.06.005
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94 L.M. Cobos et al. / International Journal of Hospitality Management 57 (2016) 93–105et al., 2007; Zhu et al., 2012). However, it is important to note thatprior studies have mainly concentrated on users’ intentions or atti-tudes toward this technology (Hossain and Prybutok, 2008; Hossainand Quaddus, 2011; Muller-Seitz et al., 2009). Limited research hasanalyzed RFID technology adoption from an organizational pointof view (Hossain and Quaddus, 2011), especially within the hospi-tality industry (Ozturk et al., 2012). In addition, a majority of RFIDadoption studies have taken a quantitative approach to investigatethe phenomenon (Hossain and Quaddus, 2011). Examining the per-ceptions and factors predefined by the researchers, many studieshave missed the opportunity to capture the intricacies involved inthe process of innovations adoption at the firm level (Hossain andQuaddus, 2011). A qualitative investigation in this vein is importantin order to gain a deeper understanding of the innovation adoptionand implementation process, and the factors affecting the processexperienced among the technology project stakeholders involved(Hossain and Quaddus, 2011).Innovation research can be categorized into two approaches:innovation process research and innovation factor research (King,1990). The process approach focuses on the organizational behav-ior and the changes experienced by the organization adoptingthe innovation (Hameed et al., 2012; King, 1990), while the fac-tor approach examines the variance of the factors and attributesthat are deemed influential to organizational technology adop-tion (Hameed et al., 2012; King, 1990). There is a clear distinctionbetween both approaches and how they examine innovationadoption. However, scholars have called for a more robust andintegrated approach to innovation adoption research by utilizingboth approaches simultaneously, examining all potential factorsthat may influence the adoption process (Hameed et al., 2012).The purpose of this research was to critically examine the pro-cess of technology adoption and implementation in the hospitalityindustry utilizing an RFID electronic locking system as the mecha-nism for service innovation. The objectives of the study were (1) toidentify the factors that influence RFID adoption in the hospitalityindustry, (2) to examine the process of the technological innovationadoption from an organizational perspective, and (3) to determinethe impact of the end users’, both employees and guests, influenceon the adoption decision of the technological innovation.2. Literature review2.1. RFID electronic locking systemsRFID enabled electronic locking systems (ELS) allow hotel gueststo unlock their room door automatically by waving an RFID-enabledkey card (or mobile device) over the door lock. RFID based ELS iscomposed of three elements: an RFID lock which is battery operatedand requires an RFID enabled “tag,” an RFID tag (identification codefor the lock comprised of various shapes such as a plastic keycard,key fob, or wristband), and a central database which communicatesback to the lock wirelessly (Öztays ̧ i et al., 2009; Want, 2006).RFID based ELS have been implemented by many major hotelbrands, providing several advantages over traditional locking sys-tems. One of the main advantages is that RFID-ELS enhancessecurity and convenience for both guests and the hotel staff. Forexample, compared to regular ELS, hotel managers are able toobtain various types of information from the locks without the needto send a hotel staff to the room. Detailed reports including infor-mation such as when a specific door was opened, who opened thedoor, and whether the door was opened internally or externally.Such information can be accessed from any computer in the system,since each lock communicates to a central database independentlyand wirelessly. In addition, ELS have the capability to automati-cally alert the hotel security department when an unauthorizedkey is used, and relays the information contained within the key(e.g., name, room number) to the central computer. Furthermore,in the case of an emergency, all the doors can be remotely locked orunlocked from a network computer with minimal navigation (Juels,2006; Want, 2006).RFID locking technology requires less maintenance than tra-ditional magnetic card systems. For example, RFID keycards lastsignificantly longer compared to magnetic stripe cards since thereis no need for physical contact between the key and the lock (Muta,2006). In addition, RFID keycards do not demagnetize, as the tech-nology is digital rather than magnetic, lessening replacement costs.There are other direct benefits to the maintenance engineering staffas a result of installing RFID enabled locks, including low batterylevel notifications that make replacements more cost efficient andless moving parts within the locking hardware without the mag-netic swipe reader (Rock, 2007).RFID based ELS can be integrated to other major systems withinthe hotel such as the property management system (PMS), retailand restaurant point of sale systems (POS), and in-room safe sys-tems. The trend of moving to cashless purchasing systems providesgreater convenience to the guests, enabling room keys or wrist-bands to replace traditional cash or credit cards (Muta, 2006; Rock,2007). This is especially convenient in a resort or theme park envi-ronment where guests may use waterproof RFID wristbands tomake purchases for the duration of their stay. Finally, with theinclusion of Near Field Communication (NFC) among RFID lockmanufacturers, smartphones and other devices will increasinglyreplace the RFID keycard or wristband, enabling the guest accessto the room and other areas of the property utilizing a cell phone(Cell Phone Upgrade, 2010; Rock, 2007).2.2. Technology adoption theories and RFID adoption in thehospitality industryCombining organizational theory and technology adoptionresearch, several perspectives on technological innovations adop-tion have evolved, and among the first was Rogers’ (1962) linearinnovations adoption process. While acknowledging the logicalorder of adoption preceding implementation in a staged adoptionmodel, Tornatzky and Fleischer (1990) argued the iterative non-linear process associated with technology adoption decisions anddeveloped the Technology-Organization-Environment (TOE) inno-vation adoption model. Extending the Theory of Planned Behavior(TPB) (Ajzen, 1985), Davis (1989) derived the Technology Accep-tance Model (TAM), which predicts an individual’s intention toadopt a technological innovation based on perceived ease of use andusefulness of a system. In other words, TAM proposes that a tech-nology is more likely to be accepted among users if it is perceivedto be easy to use. All of these approaches to early technology accep-tance research have revealed nuances in the process of innovationsadoption in a variety of fields, and early studies were criticized forimplicitly including the notion that the innovation improved orga-nizational performance and effectiveness (Tornatzky and Fleischer,1990). The maturation of empirical research in this area over timehas demonstrated a positive relationship between performanceand (1) technological firm innovativeness and learning orientationin the manufacturing and service industries (Calantone et al., 2002);(2) knowledge sharing and innovation in high tech firms (Wangand Wang, 2012); (3) innovation and customer orientation in thehotel sector (Grissemann et al., 2013); and, (4) process and mar-keting innovations with respect to hotel market value (Nicolau andSanta-Maria, 2013).Research examining the adoption and use of RFID technologyin the service industries is relatively nascent compared to those inmanufacturing (Ozturk and Hancer, 2015). With greater affordabil-ity, hospitality and other service firms have increasingly adopted

L.M. Cobos et al. / International Journal of Hospitality Management 57 (2016) 93–105 95the technology, which has generated more academic research inthe discipline. For example, RFID research in the retail industryhas examined the process of innovations adoption into previouslyestablished technologies (Bhattacharya, 2015). In the tourism andhospitality industry, RFID research applications have focused onfour main areas: human tracking and control systems, assets andvaluables tracking systems, contactless payment systems, and RFIDbased information collection (Öztays ̧ i et al., 2009; Zhu et al., 2012).Other RFID studies related to hospitality and tourism have exam-ined consumer behavior during events (Lucia, 2013), consumeractivity in museums and sporting events (His, 2003), visitor move-ment and the management of scenic destinations during peakvisitation seasons (Leong and Li, 2010), consumer loyalty (Capizziand Ferguson, 2005), luggage tracking (Fung et al., 2007), hotel pay-ment (O’Connor, 2006), and demographic influences on RFID use inhotels (Ozturk and Hancer, 2015).3. Theoretical underpinningsThe unit of analysis for the research was at the organizationallevel, as opposed to an individual or group level of analysis (Hameedet al., 2012; King, 1990; Slappendel, 1996). An organizational levelof analysis examines innovation adoption and its effect on perfor-mance (Slappendel, 1996), compared to individual or group levelof analysis which utilizes individual or group data to understandan organizational phenomenon (Hameed et al., 2012; Slappendel,1996). Furthermore, an innovation process approach was appliedto the research, which examined the behavior of the organiza-tion regarding the implementation of the new technology, insteadof focusing on the individual determinants of innovation adop-tion, as in the innovation variance approach (Hameed et al., 2012;Subramanian and Nilakanta, 1996).Finally, the researchers selected an interactive process perspec-tive to examine innovation adoption within the hotel company.Typically in innovation adoption research, either an individualistperspective or a structural perspective is chosen as the preferredcontext. The individualist perspective posits that people in orga-nizations are the source of major change, while in the structuralperspective, it is the characteristics of the organization which drivethe adoption decision (Slappendel, 1996). This study integrated theindividualist and structural perspectives by taking an interactiveprocess approach, thus analyzing the interconnections betweenindividual and structural factors of the RFID innovation adoption(Hameed et al., 2012; Slappendel, 1996).From this standpoint, the theoretical underpinnings of thisstudy were derived from Kotter’s (1995) organizational changetheory, Diffusion of Innovation Theory (DOI) (Rogers, 1962)and the Technology-Organization-Environment (TOE) Framework(Tornatzky and Fleischer, 1990). Organizational change literaturehas focused on different areas such as context, content, process andoutcomes; however, scholars in this field explain that it is impor-tant to examine all of these variables when studying organizationalchange (Pettigrew et al., 2001). Each area has focused on a differ-ent aspect that influences organizational change. Content focusedresearch has emphasized issues related to organizational structuresand strategic orientations, where contextual research examined theinternal and external environment. Furthermore, research focus-ing on processes has examined actions at the internal, externalor individual levels. Outcome focused research has been mainlylinked to behavior and profitability (Armenakis and Bedeian, 1999;Pettigrew et al., 2001). The present study takes into considerationsthese aspects which have been found important to organizationalchange research. Since this study examined the adoption process,Kotter’s process focused theory was utilized. Kotter’s (1995) multi-stage model for change outlined eight steps for implementationof organizational change which include to: 1) establish a sense ofurgency related to the external environment, 2) form a powerfulpartnership with those who embrace the need for change, 3) cre-ate a vision of the wanted end result, 4) communicate the vision, 5)empower others to act on the vision by changing systems, policiesand procedures, 6) plan and create short term wins, 7) consolidateimprovements and produce more change, and 8) institutionalizenew approaches by broadcasting change effort and organizationalsuccess.The DOI examines innovation adoption from a process per-spective and TOE from the organizational attributes or factorapproach. Rogers (1962) explored DOI to examine the prolifera-tion of new ideas and innovations considering the innovation underinvestigation, associated communication channels, time frames,and the social systems involved. According to Rogers (2003), theinnovation-decision process is a linear sequence where an indi-vidual or an organization passes through a series of stages fromknowledge of the innovation, to shaping an attitude about the inno-vation, to the adoption decision, to implementation, and finally toconfirmation of the adoption decision.Tornatzky and Fleischer’s (1990) TOE framework suggests thatinnovation adoption decisions are influenced by factors impactinga firm in an iterative, nonlinear process from three distinct con-texts including technological, organizational, and environmental.The technological context provides the decision makers’ perceptionsof the innovation which influences the decision to adopt new tech-nologies or systems (Tornatzky and Fleischer, 1990). The notion ofcomplexity within the technological context refers to the percep-tion of the difficulty in using or understanding the new technology(Tornatzky and Fleischer, 1990). Another aspect within the tech-nological context is relative advantage, the degree to which aninnovation is perceived to be better than the innovation or pro-cess currently in use within an organization (Rogers, 2003). Thefinal aspect within the technological context is compatibility, whichrefers to the degree to which an innovation is perceived to beconsistent with the present values, norms and practices of the orga-nization (Tornatzky and Fleischer, 1990).The organizational context of TOE refers to the resources andcharacteristics of the innovation-implementing organization, suchas company size, organizational structure, employee technologyexpertise, communication patterns, and resource allocation (Baker,2012). The environmental context of TEO is inclusive of forces out-side the control of the organization such as competition, customer,and governmental pressures (Baker, 2012).In general, TOE framework is consistent with DOI theorysince similar aspects are recognized as determining factors oforganizational level innovation adoption. For instance, DOI’s inno-vation characteristics and internal and external characteristics ofthe adopting organization are in accordance with TOE frame-work’s innovation and organizational contexts (Ozturk et al., 2012;Oliveira and Martins, 2011). Prior research has indicated that theprocess of innovation adoption at the organizational level is morecomplex than individual adoption decisions, as it is also affectedby environmental factors, which may present both constraints andopportunities for the adopting firm. In this regard, combining DOIwith the TOE framework delivers a better understanding of howinnovation, organizational and environmental attributes influencethe adoption and the implementation process.Building upon prior research and based on a model by Hameedet al. (2012), we propose an integrated theoretical model thatcombines DOI theory and TOE framework with additional man-agement attributes. In our model, innovation adoption is identifiedas passing through series of stages (knowledge, persuasion, deci-sion, implementation and confirmation) and we propose that these

96 L.M. Cobos et al. / International Journal of Hospitality Management 57 (2016) 93–105stages are influenced by technological, organizational, and environ-mental factors, and management attributes.4. MethodologyThis research adopted a qualitative approach and a semi-structured interview protocol was designed as the data collectionmethod. The questions for the interviews were based on an exten-sive review of the literature from studies commonly used toexamine organizational technology adoption from DOI (Rogers,1962), organizational change (Kotter, 1995), and the TOE Frame-work (Tornatzky and Fleischer, 1990). The questions wereformulated to reflect the factors that influence RFID in the hospital-ity industry, and the impact of end users’ influence on the adoptiondecision of the technological innovation.4.1. Interview protocol developmentBased on previous research, several topics were distinguished asimportant to organizational technology adoption. Environmentalfactors, internal factors, leadership and individual characteristicsall emerged as influencing components to organizational innova-tion and technology adoption. To explore the technological aspect,questions were drafted to address the relative advantage, compat-ibility, and complexity aspects of innovation adoption accordingto Tornatzky and Fleischer (1990). Another set of questions wasdeveloped pertaining to the sequence of the adoption process(Rogers, 1962) with regard to RFID technology. To examine theexternal pressures the organization may have faced in the process,items were centered on the competitive and consumer pressuresas drivers of technology adoption (see Appendix). The interviewprotocol was assessed for face validity by expert researchers ofhospitality technology and experts in the industry. The questionswere drafted to gain rich descriptions from the respondents anda deeper understanding of the factors and nuances of innovationadoption not typically examined in studies using an empirical sur-vey approach.4.2. Selection of informantsInformants for this study were comprised of employees froma hotel company which has a portfolio of 7 properties in a majordestination in the Southeastern Region of the United States. Thishotel company was selected because it has a diverse portfolio ofhotels including luxury and midscale properties. In addition, thehotel company had just recently adopted and implemented a newlocking system. In order to launch the study, a point of contact wasestablished with the hotel company to obtain permission to con-duct interviews. Once permission was granted, a list of informantswas identified for the study, consisting of top and middle levelmanagers representing the different properties and various depart-ments of each property. Top managers were invited to participatein the study, as these individuals were the decision makers chargedwith investigating the issues concerning the technology and sub-sequent adoption. Middle level managers were also interviewedbecause they were tasked with the actual implementation of theRFID key locking system. The perspective of middle managementwas important, as they were responsible for ensuring the dailyoperations of the hotel were not disrupted with the implementa-tion of the new technology. Follow up interviews were conductedwith convention directors and sales managers as it was identifiedthat convention business was an important part of the customersegment impacted by the adoption and implementation of the newtechnology. The convention sales team was interviewed because itallowed the authors to delve deeper into aspects that emerged fromthe initial interviews such as the impact of the new technology to
Table 1
Profile of respondents interviewed in the study.
Position/Title of Respondent Number
Hotel Operations
Assistant Director of Security 1
Director of Front Office 2
Director of Conference Management 1
Director of Housekeeping 1
Director of Engineering 1
Resident Manager 1
Hotel General Manager 1
Food and Beverage Manager 1
VP of Sales and Marketing 1
National Sales Manager 1
Associate Director of Sales 1
–
Senior Leadership
President and COO 1
–
Hotel Company’s Technology Group
Director of Information 1
Hospitality Application Specialist 1
Jr. Application Specialist 1
President of Technology Group 1
–
RFID Lock Company
Sales Representative 1
Total Number of Respondents 18convention customers. It was deemed appropriate to interview thesales team as they have direct contact with meeting planners andtheir needs.In addition to interviews performed with the hotel managementteam, the researchers also interviewed the vendor and the tech-nology group who were directly accountable for the RFID systemand technology needs of the hotel. As a requirement for participa-tion in the study, the informants had to be actively involved in theselection and adoption of the new RFID locking system. In addi-tion, respondents had to be available for follow-up interviews inthe event verification responses were needed.4.3. Data collectionEighteen informants were selected and asked the same inter-view questions in identical order to ensure consistency in thedata collection process. Respondents included managers from thevarious hotel departments of the company including those fromhousekeeping, security, front office operations, the president andCOO of the company, executives from the technology group incharge of all technology applications for the hotel chain, and thesales representative from the RFID lock company (Table 1). Manyof the questions were open ended and designed to allow informantsto expand upon their responses. In some cases, probing questionswere posed to elucidate informants’ answers.The interviews were digitally recorded and handwritten fieldnotes were compiled to later reflect upon during the data anal-ysis process. The interviews were conducted at the informants’locations with duration between 45 and 60 min to minimize anydisruption to the workflow, the work environment, and the guestexperience. Once the digital recordings were transcribed, theywere returned to their respective respondents to ensure contentvalidity. Three respondents elected to submit the transcripts withchanges, mostly regarding minor grammatical edits and streamlin-ing responses.