Hotel Tech Insider

SPEAKER_00:
What they do, they have these delivery robots and they're very discreetly positioned somewhere where the delivery person can drop the food inside the robot. It closes, it's completely clean and they type in the room number of the person that is ordering.

SPEAKER_01:
From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them. Today on the show, we have Floor Bleeker, the CTO of Accor. Accor is one of the largest hotel companies in the world with more than 5,600 properties and 300,000 associates globally. In this conversation, we talk about how technology is impacting every division at Accor, from cybersecurity to sustainability and guest technology. We go through Accor's digital transformation strategy and talk about how the organization is structured to innovate over the long term. Flor, thanks so much for coming on the show. It's great to have you here today.

SPEAKER_00:
Thanks, Jordan. Thanks for having me. I'm a big fan of your website, your articles, and your podcasts. Appreciate it. It's always a great read every week.

SPEAKER_01:
And I think probably there's no introduction needed for Accor, but maybe you'll tell us at a high level, the organization, how many properties own versus manage, and just a really like 10,000 foot view of the business for us.

SPEAKER_00:
Yeah, of course. So we are a hotel management and franchise company for a French company based out of Paris. We have around 5,600 hotels and it's split down the middle between managed and franchise. We're about equal. We are the largest operator in most places in the world, with the exception of the United States and China. We have currently around 300,000 employees working in our hotels. We have over 50 brands that we manage and some that are well known in the United States like Pheromone and raffles. And then we have some very big eco and mid-scale chains mainly in Europe like Ibis and Novotel.

SPEAKER_01:
So you have 5,600 hotels. How many employees work at Accor globally?

SPEAKER_00:
So it's about 300,000 employees.

SPEAKER_01:
And how is the technology organization structured at a high level?

SPEAKER_00:
Our company is structured around two divisions we have a premium mixed skill and economy division and we have a luxury and lifestyle division so they each have their own CEO they each have their own executive team and they address different part of the market they are organized in turn in the p.m. so premium it's going to economy by region so they have four large regions and the luxury and lifestyle is organized by brand so they have the key luxury lifestyle brands there now in the middle we have something that is called the global share platform and the divisions in there deliver services to both of the operating divisions. So AccorTech, what I'm heading, is one of those shared services. If you want to know how we reorganize within our core tech itself, so we have one division, so it's kind of nice because we have only one tech department across the hotel, so they're not regionalized or split into brands. So it's all centralized, but it doesn't mean that they all sit in Paris. They sit all over the world, but it's a centralized organization. So within our core tech, we have One division that looks after the relationship with hotels that's a large organization we have one division that looks after global support and that's a new one i think since we last spoke so we've centralized all the sports and they have offshore centers and outsource centers that do that support worldwide. We have a division that looks after infrastructure division that looks after security we have a division that looks after the applications for our internal stop recording tech for teams and then there is some strategic functions as well. When it comes to digital that is an entire different organization that's not under me but that is also part of that global shirts platform and we call that the digital factory.

SPEAKER_01:
And what is the mandate of digital factory like what are the core activities and things that they're bringing to the hotels.

SPEAKER_00:
So digital factory is the custom develop applications that you put in front of our customers so think about websites the central reservation system the apps the CRM they do part of that as well.

SPEAKER_01:
Are they working closely with your team on that or it's a completely different function.

SPEAKER_00:
No no we are married at the hip so we work closely together on many different topics because there is not a fine line anymore between what is customer facing and what is not and there is also no fine line what do you do you develop yourself and what do you take from off the shelf and everything needs to be integrated anyway.

SPEAKER_01:
And how do you guys think like as an organization about procurement of software? So I know we talked about in our last conversation for an article a couple years ago, we talked about your multi PMS strategy, I will get into that in a little bit. But when you just generally think about technology build versus buy, how does a core think about, okay, well, there's this new AI tool on the market, or we have a business problem in our Middle East division, and tech can solve it. Like how do some of those problem solving and looking at technology as solutions how does that come to fruition and how are technology decisions made internally when you're either building or buying.

SPEAKER_00:
Okay so the builder buy is quite simple so we've made a conscious decision to buy everything that is commodity and where we have vendors that can do that better and at a lesser cost than we can. And we built only if it gives us a competitive advantage and that's. I think it was always like that but the needle has shifted significantly because there are categories of platforms that were not available on the market and that everybody build themselves think about the pms for example that wasn't available in the past at the scale and in the way we needed it So we build our own nowadays we would not do that anymore because there are many very good pms systems out there on the market and those pms vendors can do a much better job than we can. Developing that and keeping it up to date and keeping it compliant and so on so we usually use that rule of thumb that if it gives us competitive advantage of example of a loyalty program or an app that's really something specific to us that is our secret sauce we will build it ourselves but everything that sits below it which is kind of commodity we buy that and work with partners to deliver that could be customized of course but it would come from a partner so you ask how we make buying decisions so. There is kind of two different ways we have sort of a bottom up and a top down so the top down is the easiest one that means there is a need we know we need a new XYZ system, then we would go out for tender. We would do an RFI maybe and then an RFP and there's a process internally to evaluate that and then there is a negotiation and then you sign with a partner. That can either be a corporate purchase where we buy something that we use ourselves or something that we would resell to our hotels or it could become a brand standard And then it would be the hotels buying directly but to our catalog for example. So that is the top down that is the easiest one but then we have bottom up as well and that's where there is something that works really well in maybe a region or maybe a brand or hotel there's a specific need that purchase something and it works very well. and it grows within the company and it slowly becomes a standard and those are normally the most interesting ones because that's where you come with things that you don't know you needed and that's called so i'm glad we have done a lot of acquisitions in the past because it means that a lot of brands came with their own systems and we picked and choose a very nice ones there it's also nice that we are present in many many places and that they often take over hotels that were independent hotels or that were part of another group and they also bring in innovation. So it's a good combination.

SPEAKER_01:
And when you guys either flag or buy a hotel, does your team take like an inventory of the technology systems that are in place at the start and kind of catalog that in a centralized way?

SPEAKER_00:
Yeah, so we do a due diligence obviously when it's like a takeover from our existing hotel. If it's a brand new hotel, then we have a set of brand standards and we have a team that actually looks after new hotel openings within AccorTech. They help then the owner build according to our specs but if it's a takeover a little bit different because obviously it comes with a set of technology single hotel we do exactly what you say there is a due diligence process and then there is an improvement plan that needs to follow in order to maintain the standard and then we have different levels of standards. So some are absolutely mandatory. We need it in order to distribute, in order to provide loyalty, security, etc. And then we have a number of optional standards as well that they can implement if they want to.

SPEAKER_01:
Are there any recent examples that you can think of where you guys either flagged or bought a hotel and got into the diligence process and were like, holy shit, they have this technology we've never heard of that's driving revenue or creating efficiencies or anything like that?

SPEAKER_00:
Oh yeah, so we work closely with a partner in China, Wazoo. It's a big large hotel group there, but we have a very strong partnership. And the type of tech they brought to the table is mind blowing so. Of course you know in china there always a few step ahead of what's in europe but one of the things we found there and it was developed. Buy a partner of theirs was one of those delivery robots and we have them in europe you see them in america but it's more of a gadget but they were fully integrated in the operations of the hotel so. They had a problem, like many of us have around the world, where delivery services of food became super popular. And that means that you constantly have delivery people in your lobby, in your hotel, trying to deliver food. And it's not good for the image of the hotel. It's not secure. It's not safe to have people that are not registered walking around in a hotel. So there, what they do, they have these delivery robots, and they're very discreetly positioned somewhere where the delivery person can drop the food inside the robot it closes it's completely clean and they type in the room number of the person that is ordering and then the robot actually finds its own way through the hotel lobby and it looks really cute and go to the elevator it calls the elevator by itself that's an integration that they have done goes to the floor and then when it's in front of the room it actually calls the room and it will tell the person inside your food is here it comes outside it types a code and it opens the thing you take out your food it was fantastic so that was a recent example it may not be chattering but it was really cool and i never seen that so well implemented outside china.

SPEAKER_01:
We talked a little bit about buying and flagging hotels and the technology integration that happens. I know a couple years ago, you guys went through the process of certifying multiple PMSs, which I thought was absolutely genius. Of course, the biggest challenge that you have is migrating data over when you flag a hotel and why would you put a development bottleneck in place when your number one KPI as a global chain is adding more flags to your portfolio and increasing your scale. How has the multi-PMS program evolved? Are there things that you didn't foresee happening that happened? Where is everything at today with that strategy?

SPEAKER_00:
So I have to disappoint you a little bit. We tried this very hard for two years because exactly for the reasons where you said we want to quickly reflag hotels or open hotels. And the plan was to have that middleware that would allow us to quickly provide loyalty distribution security to those hotels we selected at the time eight pms is that could do that for us unfortunately there was work required on the side of the pms. And unfortunately and maybe this is also a wake up call for some of the vendors that never happened properly so we gave a chance to many of them and they did it with different levels of success but none of them did it perfectly so. Also during those two years, cloud technology evolved tremendously. So there are now solutions available that are very easy to implement and not so expensive from a migration perspective from the cloud. So we've changed our strategy to a single vendor again, based on a cloud platform. where we then have also much better control over the data, privacy, security, and functionality. So we want to push functionality out. It's a lot easier to do that with a single PMS that is managed from the cloud than having multiple PMSs all over the place. So we're in the middle of the rollout of that. So I think about half our hotels are on it right now and the other half still to go.

SPEAKER_01:
And is that the PMS that you guys built internally originally or is that a third party?

SPEAKER_00:
It's a market PMS.

SPEAKER_01:
And so it sounds like technology has evolved, like obviously, UI path and other robotic process automation companies were existed when you guys started down the multi PMS strategy, but I feel like they've advanced, you know, exponentially since then. Is that kind of the technological innovation that's enabled you guys to quickly migrate hotels?

SPEAKER_00:
So that's absolutely part of it. The first foremost is the cloud PMS that is available in most countries in the world now that wasn't before. So Maybe you remember, another reason was that we needed multiple PMSs because we had so many different use cases where we had a hostile brand that needed to sell rooms or buy the beds, or they had to sell beds instead of rooms. And we had a sort of fractional ownership chain where there is a very complicated accounting that sits behind that, which couldn't be done. And all these functionalities have been developed and are much better now than they were three years ago. Then the cloud itself, having it compliant with all the local data regulations. So there's complex regulations that came into play in China, in Russia, in the European Union, in Brazil. And it's very hard to keep up with that if you have to manage multiple vendors as well. And then, finally, what you say, we have much more opportunity. So data was always valuable also three, four years ago, but it became even more valuable now that there is AI at play. So we are accelerating that now because we want all the data in one place so we can start offering services that are driven by AI for both our guests and our internal customers, our employees. We've just recently established an AI and Smart Automation Center of Excellence in our Bangkok head office. We're staffing that right now. And to come back to your question, sorry, it's a long way around. The first focus for them is actually RPA, and they have identified a number of use cases in hotels where RPA can really help, and we're currently implementing that. You should probably know with our hotels there are so many back office processes that don't really add value to the interaction with the customer or with the employee and that can easily be automated now that we have AI standardized data and cloud services.

SPEAKER_01:
Last time we spoke, you talked a little bit about the ventures division that you guys have, where you guys invest in some hotel tech companies. I think D-Edge, Daily Point, Treebo, we talked about. There was POS, I think you guys have since sold to Muse, if I recall correctly. Where's the ventures division? How's that evolved?

SPEAKER_00:
So we still do. The ones that you mentioned, except the last one, we still have them. So they are adding strategic value to our core. And that's why they're still there. A recent one we came actually out of our innovation lab where we have invested in a company called full soon you should look them up i don't know if they're probably on your catalog and they handle, use AI to handle food waste to predict the food that need to prepare it much better and it really reduces the waste of what we have in hotel so that is a recent example and one that could become very big when this becomes regulation everywhere around the world.

SPEAKER_01:
I know cyber is obviously top of mind for everyone. There was, you know, an MGM hack this past year that was just massive. And I know it's never good to talk too much about cyber because the hackers love to hear what's going on. How do you guys think about cybersecurity at a high level? I know that this division is under you and this isn't your direct purview, but I'd just love to hear your philosophy and if there are any interesting tools or strategies that you think hoteliers should be implementing today in their businesses, either at the chain scale or at the independent level.

SPEAKER_00:
So obviously cyber security is absolutely key for us. Probably one of the most important things we do. It has visibility all the way up to the board where we report on the progress of cyber security during every board meeting. We use best-in-class partners best-in-class tools i won't go into too much detail of course but what we try to establish is a zero trust security philosophy where we want to make it as easy as possible for our employees or partners to connect and use the systems that we have but that we apply the security in the center so we don't have to apply it in every endpoint and that works very well for us so it's traditional security was perimeter based so it's firewalls and everywhere but once you're in normally you're a trusted person and you can do what you want we've changed that and with zero trust it really is the asset or the application that is secured and regardless of where you come from you get the same level of trust.

SPEAKER_01:
Is there a changing nature of the types of like attack attempts that you guys have experienced in the last couple of years or the types of risks that you're trying to mitigate?

SPEAKER_00:
Yeah, absolutely. So what has become very annoying is impersonalization. And a few years ago, that was still quite rudimentary and easy to pick up by tools, because it was someone that wrote bad English with a link that was very obviously a phishing link. But these things become better and better. And with AI, it's a little bit scary what they can do on that. So to mimic someone's voice or even someone's video is possible. So if someone really put the effort in you can really impersonate someone quite realistically so that requires for us and for our security team to implement new systems to detect that again and it's an endless cycle of course but that's definitely happening more and more compared to the old fashioned phishing attacks that we had before.

SPEAKER_01:
And as you guys think about guest journey, pivoting a little bit here more, I know that Digital Factory is more responsible for guest-facing applications. What I've seen in our world is a converging of feature functionality across tools. So you have an upsell tool that does messaging, that does digital authorizations. And you have this map of vendors that have a ton of overlap, but then some unique stuff. How are you guys thinking about guest experience? I know you guys have the Accor app and loyalty program. How do you guys plug in guest technology and what is your general philosophy? Is it system wide or is it by chain scale? How do you guys think about all of that?

SPEAKER_00:
Traditionally we've been very good at customizing guest journeys online so pre-stay and after stay but we're not that good at it when the guest walked into the door of the hotel so we've been putting a lot of effort into extending that guest journey and the personalization from online into the in-state experience. And we do that by brand. So certain brands need more functionality than others, but the app is the driver. So even though we use off the shelf applications and providers to provide that functionality for the customer, it's the app that they see, whether it is a digital key, for example, or a digital menu or chat with the concierge type of functionality you get that's an interface the apple but the execution is done with vendors on property so we certified to and depending on region. Record the guest journey software we implement them and then there is different modules in each and depending on the class of service of the hotel you get more or less services.

SPEAKER_01:
So, you know, we talked about cybersecurity, about guest-facing. How would you characterize a state of digital transformation today? Like, where are you guys? Obviously, you're doing RPA and AI excellence centers. You're focusing on the guest experience side. You're rolling out a global PMS. At a high level, how would you characterize, like, where Accor is in its digital transformation journey?

SPEAKER_00:
So we put a lot of effort in the last three years in the basics. So our move to cloud was a very big effort. And that's kind of the basics of doing more fun stuff on the front end. So we've moved many of our applications to the cloud. We have implemented a new PMS system. We have Consolidated the back of house systems into one organization and those are all basics but there are a lot of work so once you have that in place there's a lot more you can do so i would say that's quite far along because we have those in many cases not in place but maybe there is more than we can do on the front end for our customers and for employees to actually get the benefits out of it because we're now in that phase where we're rolling that out and that may take another year or two before they can really see the benefits of that worldwide in every hotel in every office. What is funny is that there is the digital transformation and the digital journey for our customers and i think pretty good at that but there's also the digital journey for employees and that's an industry i think we can work on that and there's some work to do making it very very easy for our employees in hotels or in head offices to do their job and especially in places where there is a lot of turnover i think it's key that we put a user interface in front of them that is as good as the user interface that we put in front of our customers because they need to be very quick in picking it up they don't have a lot of time to learn it needs to be super into it So I think as an industry, we have some work to do there and that will require cooperation from many of the brands and also the vendors. In that respect, I think we're much further along in that transformation when it comes to our customers than when it comes to our internal employees. But it's fun to work on that. And I think the payoff will be very, very big if we do that right.

SPEAKER_01:
Have there been any major technological shifts on the back office employee management side of Accor at a global level in the last few years?

SPEAKER_00:
Yeah yeah absolutely so we just implemented a new HR system for example which sounds a bit boring but it's super key because that is kind of the core to everything that has to do with employees so that we just literally completed a couple of months ago and that gives us a single view of the employees that complete journey from onboarding to retirement and everything that sits in between.

SPEAKER_01:
And do you guys have any tools like I know in the hotel industry, a lot of times like GMs will want to hop between properties and that working with a company like Accor is like such one of the amazing benefits as you can go from Dubai to Thailand to the Philippines and you can have an amazing global lifestyle while growing your career, which almost nobody else can. I mean, a little more in a remote world. But do you guys have any good systems in place internally that allow for like the progression of someone at a global level?

SPEAKER_00:
Absolutely, and that was one of the key drivers for implementing a system like that. So it is quite unique that we have actually an HR platform that does learning and development, but also performance management. And that is global. It's the same whether you're working in a hotel or in an office. And we use that to identify talent and do our talent reviews. And then also to identify people that could move from one to the other. You're absolutely right. I think that we need to do much better as an industry to promote that because we're one of the few industries where you can literally work anywhere in the world and do kind of the same thing. So without much training, it's truly unique to us and it should be a major attractiveness factor to work with us in the industry.

SPEAKER_01:
From an AI perspective, you mentioned that you have this new center of excellence in Thailand that's focusing on AI. Are they interfacing with, you know, sales, marketing, revenue management, guest experience, and like trying to figure out, prioritize the best and highest use cases, or how are they thinking about your AI journey?

SPEAKER_00:
Yeah, absolutely. So it's again, two ways. So there's a little bit of top downs. We just implemented an AI based on our office, or I'm not mentioning any names, but you can imagine who that is. And that works really well with our word processing emails, the online meetings and stuff. It's incredible what that thing can do. But that came top down. That was something that we identified and we implemented. But then that center, which as I was just established, I thought it was a good idea to ask for use cases to some of the departments. I think that they regretted that a little bit because they're sitting now on the backlog of like a thousand use cases that they can implement so it's more for them to select the right ones to start with first because there's plenty outdoor but i know a key one is for example because then we had a call about that earlier today in our sustainability team They are very big on measuring our carbon footprint in hotels and we have a platform that helps us with that but the core comes out of energy bills that we get from local utility providers so they actually working on smart automation now to see how we can get those bills electronically and push them into the system electronically and do some analytics on that in an automated fashion so it's just a simple thing like that but if you ask any department head they will come up with a number of cases which is super cool because it also means that in our business and in tech for hospitality we still have a lot of work ahead of us there's a lot of opportunity for us to make a difference.

SPEAKER_01:
And are there any other ways that AI has impacted sustainability or maybe that we take this opportunity to just do a high level overview of like where Accor is at in its sustainability journey because obviously travel is one of the worst polluting industries in the world. It's not your fault or mine. It's the airlines obviously. But by the time the guests get to us we've already you know killed the earth. But I know for that reason, it's so important once they get in destination that we are responsible on our end. How's the core thinking about sustainability? I know you guys have an entire team for that, but at a high level, where are you guys at in that digital transformation and sustainability journey?

SPEAKER_00:
No, it's super key for us. It's so important that we actually have a chief sustainability officer that's in the XCOM. We have it as part of the owner's objective for each executives, their sustainability objectives embedded. Accor was actually one of the first to commit to a net neutral footprint. So it's really key and it is high up on everybody's agenda. But when it comes to tech, there's a few things where we can add value. And the first one is Our own use of technology so we have thousands of servers running around the world and by moving them to the cloud we actually reduce the footprint of the service by eighty percent it's the best thing you can do to reduce electricity usage. The other thing where we can make a big impact and we are making a big impact is the tools that we give hotels to reduce their footprint and there's a few simple ones like smart thermostats that cost almost nothing did you just plug into a hotel room. Can you instantly reduce your energy because it just understands how many people are in the room what the preferences are and how to manage the energy during the day during the night occupied by the very simple and great reducer of energy so does the second one. The third one is the measurement tool. So we don't know how well we do if we don't measure it. So you need a lot of tech in order to measure your carbon footprint, like what I mentioned before, these energy bills, but also how do you measure food waste, for example. which is another one that is very important to us so we provide technology for that and finally there is also the technology that allows our customers to make the right choices so if you go to our website for example and you look for hotels we have certain green batches that show that the hotels are taking certain measures to be sustainable so that's another one where we value but it's absolutely key on our scorecard and key on our strategy and objectives.

SPEAKER_01:
For last time, we talked about some of the inspirational brands outside of the industry or brands that you kind of look at. And I think always it's good to look outside and think about how to bring some of the strategies and techniques that other industries are doing into what we're doing. Are there any brands, either technology brands or consumer brands that you look at or recent initiatives that you're like, wow, our hotel is not doing this.

SPEAKER_00:
It's clearly for me, the airlines and especially the Middle Eastern airlines, they're extremely good at the customer journey. If you walk into an airport here, they use facial recognition for almost everything. So if I leave Dubai airport, I walk through sort of a tunnel, but you don't see anyone and you just walk through and all the identification is done even. At the boarding gate, it's not a real person anymore. It's like a virtual person that looks you in the eyes and it opens the doors for you. It's really, really well done what they do. Obviously, they have it a little bit easier in the airlines because they know exactly who everyone is because you need to identify yourself. It also makes it quite easy that everybody departs and arrives at the same time in an airplane, but it's not an excuse for us not to do it. So we actually work together with some of the tourism authorities, like in the UAE and Singapore, we're doing it in Saudi, where we try to transfer the burden of identification to the airport. because they're very good at it. They have all the right skills and all the right technology there. And then once they are identified at the airport, that we don't have to do the same thing in hotels anymore. So don't need to take passport copies and match photos and so on. So I think they're small initiatives, but it could be a game changer if we do that at scale and we do that as an industry as a whole. It would make the journey so much more seamless.

SPEAKER_01:
That's all for today's episode. Thanks for listening to Hotel Tech Insider produced by Hoteltechreport.com. Our goal with this podcast is to show you how the best in the business are leveraging technology to grow their properties and outperform the comp set by using innovative digital tools and strategies. I encourage all of our listeners to go try at least one of these strategies or tools that you learned from today's episode. Successful digital transformation is all about consistent small experiments over a long period of time. So don't wait until tomorrow to try something new. Do you know a hotelier who would be great to feature on this show? Or do you think that your story would bring a lot of value to our audience? Reach out to me directly on LinkedIn by searching for Jordan Hollander. For more episodes like this, follow Hotel Tech Insider on all major streaming platforms like Spotify and Apple Music.