From PMS to POS—the 20 year evolution of hotel computers

By Marni Andrews

Twenty years ago, the value of a PMS was in its computerized capabilities as properties began to switch over from manual systems. Ten years ago, the more valid comparison was between a DOS and a Windows-based system. Today, the frontier is on-site vs. online systems, says Jim Mockford, general manager of Vancouver’s The Listel Hotel, which uses Maestro, a product of Northwinds.

Hotello Property Management System

Mockford switched systems about five years ago and notes that his new system allows him to review guest histories after checkout as well as to write unlimited guest notes on reservations. The previous version allowed only 20 or 30 letters for notes.

Lisa Jane Gibson, director of revenue management for the six Vintage Hotel locations, uses Maestro’s tech suite. This includes the front office PMS, a spa and activities system, sales and catering, AR and a yield management system that enables the Niagara-on-the-Lake based hotel company to implement optimized rate strategies across all six hotels at one time. Vintage also has a centralized Maestro GDS two-way interface that provides guests with seamless availability when booking online.

Gibson sees three main trends with front and back of house systems. First is the wider use of technology to enable properties to run more efficiently. Another trend is more personalized interaction with guests. Finally, Gibson notes the upcoming deadline (Sept. 30, 2010) for all businesses to comply with the Payment Card Industry (PCI) mandate for specific security guidelines.

“The fastest way to make any technology pay for itself is to use it to increase revenue and sales,” says Gibson. “We use the guest database in Maestro to gather information on which seasons guests prefer, what activities interest them, where they come from and other factors. If we forecast a slow week in the spring, we may mine our database and send an e-mail to all guests who prefer our properties in the spring. We’ll offer a special ‘spring’ rate or amenity package.”

Micros WS5 Simphony POS system

Looming PCI deadline

The already-begun transition to computer chip payment through Interac is a significant event in the payments industry, according to Tina Romano, manager, public relations, Interac Association. She says that it will prevent debit card skimming and the production of counterfeit cards since the chip technology allows the card and the terminal to carry out additional security checks to ensure the card is valid. All ABMs and cards will be upgraded by 2012.

Dr. Gabor Forgacs of the Ted Rogers School of Hospitality and Tourism Management , Ryerson University, who has just released a book called Revenue Management: Dynamic Pricing, cautions about rushing to leave everything to the system.

“I like the ability to interface all systems within a property and gather data from each touch point (transactions) and track plus benchmark. However there is also a growing temptation to leave everything to the system—to generate welcome messages, assign rate codes, assign special codes if a guest needs certain amenities or a specific room location,” says Dr. Forgacs. “The danger is that staff training pays more attention to system-based tasks (e.g., running reports) than to personal service.”

Anais Berzi, director of marketing and operations, Mingus Software, which created the Hotello Property Management System, says that hotel management systems are tending to revolve around automating operations in order to allow reservation and guest service agents more free time with clients. These features include automatic room allocation, key lock interface, POS, automatic package management, yield management, intelligent room control and, most notably, online reservations.


Guest trends affect PMS products

“The guest has a direct influence on developing solutions for our PMS; their trends dictate the direction of our product development,” says Berzi. “More and more people are becoming their own travel agents. Properties that provide their clients with the possibility of an immediate reservation, complete with package selections, have a greater chance of securing that booking than those properties that play the back and forth correspondence game with the client.”

“It is at the point of sale that guest confidence is often created or destroyed,” explains Tina Stehle, senior vice-president and general manager of Agilysys Hospitality Solutions Group, which offers the InfoGenesis POS system. “For example, loyalty programs that encourage guest purchasing behaviour can increase revenues and build repeat business. Business intelligence enables hotels to collect transactional data and create reports that enable managers to review guest spending patterns, identify trends, capitalize on revenue opportunities and plan for the future.”

Stehle thinks the biggest trends are loyalty, guest experience management and CRM. Increasing dependence on smart phones is another, while table-side payment devices and business intelligence capabilities offer guests security and management greater amounts of data to use in decision making.

Ironically, despite more data being available through PMS than ever, some privately-owned hotels end up changing their systems because they are not able to extract the data they need or the employees with the appropriate knowledge have left the property, says Jeremy Roncoroni, general manager of the 65-room St. Regis Hotel in Vancouver. Roncoroni uses the RSI system and is currently working on incorporating guest history capabilities.

Teletec Restaurant Manager POS: back office physical inventory

Food & Beverage

Ryan Murray, director of operations for Niagara’s Finest Inns in Niagara-on-the-Lake, Ontario, currently uses Teletec System’s Restaurant Manager in three of his on-site restaurants: Zees Grill, Charles Inn Dining Room and Butler’s Sports Bar. Murray says that the system has proven very useful for tracking inventory and cost of sale as well as setting up and running reports for key areas of the business such as returns, refunds and promos.

“We have also been able to better track our consumer trends, in particular the times of day that tend to be best for sales and average cheques. This knowledge has allowed us to better accommodate our guests by anticipating preferences ahead of time and adjusting our specials and menus to suit those needs,” he says.

Teletec Systems Inc. vice-president of sales Andrea Roberts notes that their Restaurant Manager POS handles not only table service but also quick service for coffee shops, delivery for room service, lounge, bar, banquets, handhelds, etc. She says that food and beverage inventory can be tough to control. However, the “menu explosion” feature can track an item through ordering and receiving back into inventory.

After a server touches the item on the POS screen, an eight-ounce NY steak, for example, is taken from inventory along with three ounces of mixed vegetables and four ounces of garlic mashed potato that make up that plate and the food cost of the entrée. If steak inventory is below a certain level, it will be automatically placed on a reorder report. A purchase order for the reorder is also generated for the relevant meat supplier. When the meat is received, the system updates the quantity and flags the item if it has gone up or down by ten per cent or more.

“Keeping a close eye on food cost is the difference of a successful operation,” says Roberts. “It is the job of a robust POS system to help the restaurateur make the right decisions. Reprice it, replace it, reposition it, or remove it!”

“In the West, hotel operators with pubs often open Liquor Retail Outlets. These liquor stores require proper inventory control and ordering management,” says Fraser Brooks, business development manager, Profitek POS Solutions. He adds that specialized retail POS systems are designed to provide the controls necessary to manage limited shelf space and maximize profitability.

Profitek is now providing browser-based access to gift card and customer/member information, table reservations and online ordering from the same portal, says Brooks.

“These are services that have been available through third party applications, but often the customer must go to one site for reservations, another for ordering and a third for gift card inquiry/management. Clients have asked for one portal that handles all of this seamlessly through the company website.”

Teletec Restaurant Manager POS: back office food cost by location

Cost savings hot topic

Glenn Deal, sales development manager, Casio Inc., which produces several POS products, says that customers in these difficult times are spending less and don’t want to spend more for something they don’t need. However they still want tight control. Deal says that Casio’s flash ROM terminals are great options for this situation, with 80 per cent capability of a PC-based system at a lesser price.

“The focus will be on adding new technologies to existing systems as operators look to do more with less,” agrees Kelly Maddern, chief technology officer, MICROS, who also suggests that reducing costs and focusing on core competency should be a goal of hospitality executives. “Internal IT costs, especially those that can be cost-effectively outsourced, will be considered more than ever in the upcoming year.”

Maddern adds that popular features for POS include solutions that integrate across the entire technical portfolio. Having one fully integrated solution is not only economically efficient but provides a secure, reliable system. The quickest way to realize a difference in the bottom line is to utilize the actionable data a POS system provides.

Hotel management consultant Paul Lynch of PGL Consulting has been able to deliver a cost benefit of up to five to seven per cent on wage savings with H&L Canada Ltd.’s Workforce Management control system. Lynch initially used it to monitor staff rosters daily but now has embraced the package as a complete information and management tool for the sites that he controls.

Ziad Mehio, president, H&L Canada Ltd., is finding that most companies want to save every penny from cost control to employee management. He has seen profits increase by five to 10 per cent through having better control on inventory and staff—for example, tracking bar inventory with a five-step daily process and an application that schedules staff based on budgets and actual sales.

Dr. Gabor Forgacs of Ryerson University acknowledges that there are both highs and lows of being ever more digitally interfaced. “Wonderful new technology should enhance guest service and not replace it,” says Forgacs. “A smile, a personal welcome, attention to details, a familiar face, intuitive service may mean more to guests than the text message stating ‘The battery in your TV remote control has been replaced as requested. Housekeeping.’”

Teletec Restaurant POS: various back office inventory related screens