Use Of Technology In Hospitality Aviation Industries

Published Date: 02 Nov 2017

Zhan Huixin

Week

6

Topic

Reflections on Use of Technology in Hospitality and Aviation Industries

Report No.

4

Word Count

Abstract

This seminar was hold by Fanny Chan with the theme of "Use of Technology in Hospitality and Aviation Industries".

At the very beginning, Fanny showed the audience a video as an opening chapter to demonstrate the current technology used in Mandarin Oriental Hotel Group. After that, she interacted with students and encouraged us to think what makes the luxury hotel different from other common hotels. Later on, Fanny explained the revenue model in Mandarin Oriental by using authentic figure. After the calculation, it was clear that it only took the luxury hotel one month to reach a breakeven point.

After the elaboration of hospitality industry, Fanny switched to aviation industry with a detailed example, Hong Kong Aircraft Engineering Company Limited. HAECO belongs to SWIRE Group. During the seminar, Fanny explained that HAECO has branches in Mainland China, like Xiamen, Fujian, Jinan. For aviation industry, Maintenance, Repair and Overhaul (MRO) systems are crucial because they cover end-to-end process; say Sales & Marketing, Maintenance Engineering, Maintenance Scheduling, Maintenance Operations, Maintenance Supply Chain and MRO Support.

From this lecture, I learned that information technology plays an essential role in the success of hospitality and aviation industry. As a matter of fact, IT improves the overall performance in terms of profit, customer services and employee satisfaction.

Seminar Content

In this seminar, speaker is Fanny Chan, General Manager of Management Information Systems Department in HAECO (Hong Kong Aircraft Engineering Company Limited). In addition, before she worked as Director of Information Technology in Mandarin Oriental Hotel Group. With rich experience, Fanny was able to share her own experience in information technology related to hospitality and aviation industries. Generally speaking, the main content can be divided into two parts.

For one thing, it is about hospitality industry. At the very beginning, Fanny showed us a video about Mandarin Oriental, a luxury hotel group. Then Fanny asked us what we saw in the video and what the difference were between Mandarin Oriental and other hotels. After the interaction with students, Fanny summarized the main differences included entrance panel, temperature panel and inexpensive long distance calls. Undoubtedly, information technology contributes a lot to all of those advanced facilities. Specifically, the entrance panel is made up of valet DND (Do Not Disturb), delivery and laundry button. As for the temperature panel, it is humanized. For example, the hotel has an automatic controller to adjust the temperature. In other words, if there is nobody inside the room, the controller can sense it and then lower down 1 degree centigrade, which saves one million for a hotel every month. As for the inexpensive long distance call, it mainly refers that when customers dial a long distance call, then the line will automatically connects to Skype, which is popular online call software. Consequently, the expense is quite low for customers, which is money saving for both customers and hotel. The launch of these services aim to maximizing customer satisfaction and to reducing cost. Later on, Fanny mentioned the hotel operation part, which can be divided into Hotel Operation, Sales and Catering System, Food & Beverage, Spa, ERP, Rapid Response and Audio-Visual. Besides, we also calculated how many days it took the luxury hotel to reach a break-even point, i.e. 34 days.

For another, Fanny elaborated the Aviation Industry with a detailed example with HAECO Group, which stands for Hong Kong Aircraft Engineering Company Limited. Actually this group belongs to SWIRE Pacific, which provides services in various kinds of industries, like property, beverage, aviation, marine services, trading and industrial, etc. HAECO Group covers some key lines of business, say airline maintenance, cabin reconfiguration, cabin completion center, freighter conversion, parts manufacturing, line maintenance, fleet technical management, inventory technical management, component services, engine overhaul and technical training. When it comes to the overhaul of airframe maintenance, it has four checks, which takes 100-150 hours, three months, 12-18 months and 20 years respectively. In the end, Fanny explained the IT systems in Aviation industry, i.e. MRO Systems cover end-to-end process.

Analysis & Discussion

After this seminar, I deeply feel that information technology really brings huge benefits to both customers and companies. In order to maximize customer satisfaction, company has to find out what customers exactly want. Tellingly, customers like convenient, humanized and fast service. Based on the seminar content, two topics will be analyzed in the following section.

For one thing, how information technology improves hospitality industry? After conducting online research and interview with insiders in hospitality industry, I figured out the following points. First, with the boom of wireless, it is much easier for customers to check-in. [1] As what Fanny mentioned before, Mandarin Oriental has a technology that enables the fast but accurate service. For example, when a VIP customer arrived in the airport, the driver of the hotel will go to pick him up. Then, there is a setting on the car, which can notify the frontline of hotel that exact arrival time of the customer. After reaching the hotel, bellboy helps to collect the luggage and lead customer to the room without check-in, which brings huge convenience to customers. There is no doubt that customers will feel like staying at home. Besides, what are the ways to retain loyal customers? Imagine that you spend birthday or anniversary of marriage in a company, but a hotel prepares you for warm greetings, elaborate party, which may surprise you and capture your heart. Frequently, people would tend to choose this hotel again. As a result, the hotel wins the loyal customer and even gets benefit from the word-of-mouth effect, i.e. customers will bring their friends and friends bring their friends, which is a virtuous cycle for the whole company. Specifically, for the luxury hotel, the profit is amazing but it also takes a number of years in construction and brand image building.

For another, how information technology improves Aviation Industry? Take the technology Radio Frequency Identification (RFID) as a typical example. RFID refers to the use of a wireless non-contact system that uses radio-frequency electromagnetic fields to transfer data from a tag attached to an object, for the purposes of automatic identification and tracking. [2]

In aviation industry, the wide application of RFID saves a great deal of money for the companies. To begin with, RFID can enhance the effectiveness of components and parts management. For instance, before the application of RFID technology, Components and Parts Manufacturer of Boeing has seven staff responsible for parts receiving and data scanning, which consumes a huge amount of time. Furthermore, errors always happen frequently. However, Boeing spent US$16,000 on RFID system and applied it for half of a year, which saved US$29,000 in terms of labor cost.

Then, RFID can also enhance the reliability of maintenance. As Fanny mentioned before, it took a long time to complete the overhaul process. The reason is that aircraft mechanicians have to spend much time to find out the appropriate needed maintenance fittings. According to a well-known market research company AMR, aircraft mechanicians have to spend 70% of their time in looking for the right fittings because they use manuals for the first time data input. As a result, data errors are unavoidable. However, with the use of RFID, it labels the history of every fittings accurately. In addition, aircraft mechanicians can easily recognize and checked the needed fittings. Moreover, RFID can record the process and history of maintenance, enhancing the overall maintenance quality. [3]

Finally, RFID can reduce the manufacturing cost as well as strengthening the safety level of aircraft industry. Based on the statistics of Airbus Company, wrong fittings information existed in 70% of order forms, which increased the company US$400 million cost annually. Undoubtedly, RFID is able to lower the artificial inputting errors, helping the company realize digitization, thus leading an augment in information managerial level. Besides, RFID possesses the functions of encryption and unique encoding, enabling the company to attack copycat fittings. Moreover, with the reinforcement of digitization as well as monitoring capability, aircraft manufactures can realize both strategic cost reduction and enhancing safety level.

Conclusion

In short, with the use of information technology, both customers and consumers reach a win-win solution. No matter in hospitality industry or aviation industry, information technology is the key trend in the future. There is no doubt that the business objective of all companies is profit. It is easy to understand the formula that Profit = Revenue – Cost. In order to maximize the profit, we have to maximize revenue and minimize cost. Fortunately, information technology can help companies to achieve their aims. However, IT is a double sword. Even though IT has many advantages, like reducing cost, enhancing performance efficiency, increasing customer satisfaction, it still has some disadvantages, i.e. security. When it comes to privacy and security, companies are suggested to pay attention to protecting customers’ data and adopting corresponding systems to prevent themselves from hacking, attacking due to security loops.