Hotel Tech Insider

SPEAKER_02:
Today, with the digital world, we see a huge increase in online checking. I was recently at a conference where one of the top tech guys said, well, people don't want online checking. We see exactly the vice versa trend.

SPEAKER_00:
From Hotel Tech Report, it's Hotel Tech Insider, a show about the future of hotels and the technology that powers them.

SPEAKER_01:
Goryan Lazarev is the Chief Executive Officer at Orea Hotels and Resorts, and we sat down with him to learn about his approach to digital transformation at Orea's portfolio of 20 hotels across the Czech Republic. Gorian brings a really interesting mix of hotel and telecommunications industry experience, including a stint at Marriott, which gives him a unique perspective on technology in the hotel space and a career-long focus on delivering a high-quality guest or customer experience. Keep listening to learn how Gorian and Aurea rolled out online check-in, developed a process to monitor employee satisfaction, and even debuted a robot named Pepper that cleans public spaces and serves drinks at the bar. So at the beginning of these conversations, I like to start by learning a bit more about your background, your career so far in hospitality, what you're doing now, and a bit about your company and what you do in that role.

SPEAKER_02:
Yeah, thank you. I'm Gorjan, originally from Macedonia, living in Czech Republic from 1998. I came here to study college and stayed here. My career so far has been a mix of hospitality and telco. I started with Marriott, then I was working for Oscar, which was a third mobile operator, basically in revenue strategy, pricing. then went back to Marriott, then to Vodafone, and from or since 2011, I have been involved in transformation projects. First of a single property luxury hotel in Prague, that was the Boskolo Hotel, five-star hotel, which I was running from 2011 to 2016. And since 2016, I'm in charge of the largest hospitality brand in the Czech Republic, Onea. Orea is, as I said, the largest hospitality brand in Czech Republic. We have hotels in Prague, in the capital, which is very popular, but as well out of Prague, places which are very beautiful. Actually, I would say that we have hotels in the best locations in Czech Republic. We are running large congress hotels, business hotels in the cities. Then we have spa hotels and resorts, basically mountain resorts. So it's a mixed portfolio of 20 properties. It has been a transformation of the brand because most of the hotels are built in the 80s. So they don't have this very attractive feeling from the outside. However, we all know that people make the difference in hotels. So we managed to change the company culture. We managed to build the OREA brand awareness. We're currently having 60% unassisted brand awareness in Czech Republic and we're leading the market. and actually connect the brand with innovation and with great customer experience.

SPEAKER_01:
It sounds like you also have a variety of guests. Leisure travelers going to those spa resorts, business travelers in the city. Can you tell me a little bit about who the typical guests are? Are they local Czech people or international?

SPEAKER_02:
Yeah. Basically, as we are a Czech brand, we've managed to increase the base of Czech clients from 30% in 2019 to 60% currently. So if we look at the resource, basically the out of Prague properties, mostly it is the source market is Czech Republic and the neighboring countries, which is Germany, Poland, Slovakia, and Austria. And in terms of our hotels in Prague, obviously, we have a mix of clientele there. We have US clients, we have clients from all over Europe.

SPEAKER_01:
I'm curious to learn more about your background in Telco and Marriott. What were your roles and if you were going back and forth between industries, how did those kind of overlap?

SPEAKER_02:
Well, I think that's one thing that probably personally for me meant a lot because it opens you up. You know, once you see another industry, you realize that if you know what the most important things are, they're very similar across industries. You know, you need to focus on the customer and solving the customer problem or delighting the customer in some way, no matter whether you're working in a hotel, in telco, in a van. So I think that this is probably the biggest gain from looking at it probably slightly differently and from a different angle for both industries. You know, when you're starting, obviously you need to, the train is running and you need to run very fast in order to catch up and be able to use all the terms that are connected to a certain industry. But that's really very easy at the end of the day. And if I look at the similarities, Marriott was a people first company and is still with a very strong company culture that is focused on its people. And then Oscar, which was a challenger brand, the third mobile operator starting from scratch in the Czech Republic and having an enormous growth, had as well a very strong culture based on its people. And this is where actually when I realized that no matter what you do, it is the people that make the difference. And with great people, you're able to accomplish great innovation as well.

SPEAKER_01:
I'm interested to dive more into Orea and learn more about your role there and the technology that you're using in your operations. So to start this part of the conversation, I'm curious to learn what is the most critical technology partner in your company and why are they so important?

SPEAKER_02:
Basically, since the start of the transformation process in Aurea, I sort of like divided the change into, I call it software and hardware, which is people and then hardware, which is basically the physical product and then the infrastructure that you have. So in the beginning, it was mainly focused on the people and really empowering the people to make sure that they're able to take care of the guests and that they have all the tools needed so that the guests leave the hotels happy. And if I look at the hardware, obviously it was the product improvement because we said, okay, The hotel experience doesn't need to look like traveling time, that you can actually have hotels built in the 80s, but that inside, from a look and feel perspective, look present and they have a very present look and feel. From a technology standpoint, back in 2007, we were probably the first company in Europe that introduced the robot. We introduced the robot Pepper, which was a concierge robot. And at that time, because we as management, we decided on what our values are as a company. And we said, okay, It's care, it's trust, it's passion, and it's innovation. And it was a very strong signal that, okay, values for us, it's not only a nice PowerPoint or a nice poster that stays on the wall somewhere, but we really need to leave those values. And that is why even when the hotels were really in the back, we introduced the robot and it was a great hit. If I look at the COVID time, and at that time we were using Mopra. If I look at the COVID time, obviously we don't want this time to return. But after the initial shock, we started internally thinking of, okay, so how can we utilize this time to move the company forward? So this is a time when we decided to change the property management system. We're looking into different options. We have chosen Hotel Time, which is a Czech company, which is offering a cloud-based property management system because we think that basically this is the core of the hotel. And obviously the data that the system is able to capture, you're able to use and with that to enhance the guest experience.

SPEAKER_01:
What was it about Hotel Time that made you choose that product?

SPEAKER_02:
Well, if I look at it, and even by having the experience, it is a system that is very flexible to connect any type of other system that you need to include. And obviously, we wanted to digitalize the guest journey. So from an online check-in, check-out system to a revenue management system or all these systems that come on top. It is obviously a cloud-based system. It is a system that is giving you an opportunity to work as a chain. And then, of course, if I look at it backwards, it is a very stable system. So from a performance perspective, I recently met their CEO and this is one of the key feedbacks. I said, you know, not clean wood, but performance wise, you guys are really great.

SPEAKER_01:
So with hotel time as the PMS, are there additional modules like for revenue management or digital check-in or are you using third party systems that plug into hotel time?

SPEAKER_02:
It's a property management system. It has modules as a POS system in FNB. And then it has a great spam module for basically managing all this inventory that you have in the resorts, which is adding value very much because obviously today with the digital world, we see a huge increase in online checking. You know, I was recently in a conference where one of the top tech guys said, well, people don't want online checking. we see exactly the vice versa trend. And again, maybe it is the people and the way we look at it. We really, after COVID, we hired some tech people, some talent that I think we, as a hospitality company, were lacking. And we see a huge increase in usage of these online services. And hotel time is great because basically, all these services in their liberal system, which is the spa operational system, can be booked online and you can run all kinds of promotions for your customers. And that obviously is a win-win because in the same time, you're increasing revenues and increasing guest satisfaction because there is nothing worse than a guest coming into a resort and then not being able to enjoy a massage or booking something that they really wanted to enjoy during this day.

SPEAKER_01:
How many of your guests utilize the digital check-in? Is it the majority of guests?

SPEAKER_02:
It's still not the majority of guests. It is still about, let's say, 100,000 check-ins year to date, which is more or less, if I look at it, 30% of the guests that are using it. So we're trending year on year, a huge increase. And we're working on something. We know that we're using Mystay as a platform for the guests to do the online check-in and online checkout. And we are currently working on a project that should be launching somewhere mid next year, where you would already have a personalized profile on our web. So you wouldn't need to retype the things twice. We will already know your preferences. So you will have one-click booking, no credit card booking, all these types of customer benefits that I think that would increase the usage of these services even more.

SPEAKER_01:
And curious to learn what other systems are in your tech stack. So for revenue management, for your booking engine, what else are you using?

SPEAKER_02:
We're using fast booking for booking engine. And in terms of revenue management system, we're trialing few solutions. We're still in the process of choosing what is best for the company and you know, whether we'll go with a one size fits all or we will adjust it based on the different types of hotels. So we're in a piloting stage. Obviously with artificial intelligence, now a different options comes as well because at the end of the day and Back in 2006, I was a member of the market board of Marriott, which, you know, was like revenue management leaders that were developing the Marriott revenue management system. So I think that there is a huge maybe, or there is an opportunity maybe to even look into developing an in-house solution for optimizing the revenue and optimizing the total revenue. But obviously that's a big project. But as we see the possibilities of AI and how things are getting speed up, if this a few years ago was a mission impossible and would be a multi-million, multi-year project, today I see it as slightly more feasible than before.

SPEAKER_01:
Any other technology that you and your team are using that you'd like to share?

SPEAKER_02:
We have piloted end-to-end self-check-in, meaning that you do everything on the mobile and you open the door with the mobile. We still are discussing with our keylock supplier in terms of a solution that will fulfill the safety and security measures so that we can really roll it out throughout. We're using robots not only as concierge, but we are really using them helping within the service and they're a great attraction on the resorts. People actually come to the resort so that they can be served by the robot.

SPEAKER_01:
So they're serving like in the restaurant? What exactly are they doing?

SPEAKER_02:
Yeah, the robot has the whole bar mapped. So when a person orders, and you can do it even by QR code, the system knows which table the order is. So then the robot knows and if there is any obstacles on the way is able to go around these obstacles and leave the order so that guests can pick it up. So that's great. Then in the resorts, in the buffet restaurants where you have a lot of volume, it helps the staff when they're cleaning up everything. And so they put everything on the robot, they press a button and the robot goes to the kitchen, to the dishwasher. So step saving in terms of guests. And then I think that if I'm not wrong, we were probably the first company in Europe as well to launch a robot that is cleaning in Hotel Pyramida, which is next to the Prague Castle, a great 330 room hotel with a swimming pool, with a cinema, really nice place to introduce basically in this big hotel, a robot that is cleaning the public spaces and is able to call the elevator alone. So basically, it's completely independent. And in addition to that, we are using the robot to deliver room service. So it's a four-star hotel, but we still have room service because of the robot. So you're in the room, you have a QR code, you can have the menu or the room service, and then the robot delivers it to your room. And that's as well, something that we just love.

SPEAKER_01:
What vendor are you using for the robots? And are these products off the shelf or have you worked to develop something custom?

SPEAKER_02:
No. And actually, I'm not even aware of the vendor. This is something that the team has been working on and testing different solutions. So this is nothing, let's say, tailor-made for us, but it was already built and a solution that I think that anyone can have. Anyone that is not afraid of trying new things.

SPEAKER_01:
How was the transition with your staff? Were they apprehensive about having the robots on site or were they excited about it?

SPEAKER_02:
I think excited. Obviously, in the beginning, with the first robot, when we launched it, it was too early in the transformation process. So they were probably thinking, this is maybe crazy. But this had a far more symbolic value for us in the whole transformation. But then with the service robots and with actually all of these digital encampments, I see support from them because it makes their life easier. And again, are we looking into a world where robots will substitute people? I don't think so. Because still you need the human interaction. And even today with the tech companies, you know, you could see that once you have a problem and there is something that a chat or a robot can solve, but then sometimes you just badly need to speak to a person. And that has enormous value. And I think that in hotels, it will stay. However, what changes is the fact that all these manual stuff that actually adds only frustration in your work, are being substituted by robots. And then you have far more time to do a job that adds value to show your empathy, right? As a person, because robots will not have empathy and to actually be able to adjust and personalize. Because I think that is in all industries, we are moving in from a one to many to a one to one relationship in terms of personalization, right? So we'll see and with the artificial intelligence even more, we'll see more personalized services and they will be delivered by our people.

SPEAKER_01:
And can you tell me a bit more about the technology you're using in the back office? So for accounting or even housekeeping management, is that all connected with hotel time as well?

SPEAKER_02:
Yes, basically, we have an ERP system that is connected to HotelTime. So the accounting system is different in terms of housekeeping management. That is a module that is used within HotelTime. And then the company, as we are a company that is geographically remote, and we have, I think, very innovative owners as well. Even when I started in 2016, the company was already using the Microsoft 365 remote systems. So for us, actually, with COVID, it was not as big of a shift as for other companies that were completely pen and paper way or the old way or the email way only, you know.

SPEAKER_01:
And are you using any software for upsells or ancillary revenue?

SPEAKER_02:
No. No, because actually, and again, we think that, or my opinion is that with artificial intelligence and with being able to really personalize the offers, we will be able to make offers that are relevant to you and upsell. We are a company that is strongly focused on guest experience. And we are far more interested in the customer lifetime value than the transactional value. So this is a conscious choice, a strategic choice that we have made that we will be focusing our efforts on guest experience and really trying to raise the level. then actually trying to make money on different transactions. Obviously the relevant, once we have the data and once we have the systems that are able to process this data, we see today in all the online merchants, right? You go to amazon.com to buy one book and then you end up buying three because it gives you a relevant information. So I don't think we're there from a technology standpoint.

SPEAKER_01:
With the focus on guest experience, how are you measuring the review scores or are you using a system that helps you understand reputation?

SPEAKER_02:
Yes, we're using trust you as a system. It has all of the guests you've used throughout the channels. And then one thing that probably transformed the whole company we use as well, another system, which is really great for internal employee motivation and engagement measurements, which is Luther one, which is sort of like an internal social network. that people use. You can give bubbles, sort of like it's more positive feedback for your colleagues. You can post things. And every two weeks, employees, so instead of waiting in a classical corporate way that once a year there is a survey you fill in and it's long and it's whatever, this system is made so that you get every two weeks different set of questions and it's throughout the whole company. So you're actually able to get and measure the employee engagement as well. And this is what we see, that comparing not just to the peers in hospitality, but as well to other peers, we are far above average in terms of guest focus. Our incentives are on customer experience and guest focus, and mostly on the reviews that people leave on our own website, on our ACZ and booking.com. And our teams take great time analyzing the guest preferences, the likes and dislikes, and always utilize the systems to find opportunities to enhance the guest experience. Because yeah, success is never final.

SPEAKER_01:
Curious to hear if there's any technology on the market that is on your wish list. Something you think is really innovative, but you haven't implemented it yet.

SPEAKER_02:
I was hoping that the revenue management systems, as I was working on the development of one back in 2006, would be slightly more advanced in terms of how they look into total hotel revenue management. In my view, as I mentioned previously, I think that AI opens a huge opportunity. And yes, we're in the early stage now. Yes, we're beginning to understand what it can do. we're finding the mistakes and proving that this wouldn't be anything big. Actually, I think it is big because what it can do in just seconds allows you to completely change the way you work. So if I look at it, what is on my wish list is to become an AI innovation leader. which would put us ahead in terms of really delivering these personalized services. And by delivering these personalized services, adding value to both the guests but as well our top and bottom line.

SPEAKER_01:
Expanding on that a little bit, I'm curious if you can share one or two high priority business objectives that you're focused on now and how technology is helping you get there.

SPEAKER_02:
Well, if I look at the high priority business objectives, obviously one is growth. And I think that technology plays a big role in terms of enhancing our value proposition to hotel owners and strengthening the value of the brand. And obviously another is efficiencies, internal efficiencies, where I think that the technology would help us and especially AI and all this analysis would help us manage our costs far better. Because I'm a big fan of really trying to be as effective as possible on the things that are basic and that are not adding value. And then focus your efforts and the money that you save by running this efficiently on actually increasing customer value.

SPEAKER_01:
And on the topic of growth, are you focused on revenue growth at your existing portfolio or increasing the size of the portfolio by adding more hotels?

SPEAKER_02:
It is a two step process or it's a parallel process. One is adding our, I don't think that we have still reached our cruising attitude in terms of our hotels and where they're performing. We're working currently on a refinancing deal that would enhance our products even further because we believe that only by adding value for the customer, you're able to increase your top line and we should be there probably 2026. And then in the meantime, we're working on an asset light strategy of opening our platform, basically, because we see that the platform is successful in Czech Republic. We want to give our guests an opportunity to choose more places within Czech Republic. But as Czechs are traveling a lot outside, though it's not a big source market, it's only a 10 million people market. We're looking into the neighboring countries and the countries where Czech Republic is a huge source market to actually expand our brand there. And in combination to the experience we offer to our international guests in Prague, to maybe as a long dream, be able to do something with the brand in the future on a larger scale.

SPEAKER_01:
With that in mind, given this industry is so dynamic, a lot of challenges, you're working with a lot of different people, what do you see as one or two skills that are necessary to be successful as a hotelier?

SPEAKER_02:
Well, I think that one is connected probably to the basic and this is not to forget about the people and not to forget about the people, meaning the employees that are working, their needs and their preferences and how together as a team, you're able to add value for the customer because this is at the core. And when things add up, people tend to forget this. And then the other skill, I think, is the digital skill. The fact that we really need to be aware that the world is changing, that actually I recently watched on Apple TV, Blackberry, the movie, very nice example of an innovative company being on the top and not willing to change and to see the customer preferences and actually going down. And there are tons of examples like this. So I think that if I look at the hotel industry, it really needs to change in terms of how we do things differently. As I said, From our point of view, I think that one of the best decisions we have made during the COVID crisis was actually this system changes, but as well, strengthening our team with digital expertise from other industries. Because you know, usually if you're fixed in the industry, you know, people are afraid that, ah, yeah, but he doesn't know. But whatever you don't know and back to our discussion in the beginning, you're able to learn in a very quick way. But the out of the box thinking then the person brings to the table is phenomenal value. And again, now, if we look at the, you know, how the educational system is changing, how everything is changing in terms of from a knowledge base, which is now on a few fingertips to AI, right? You don't need to read 200 pages of books. You have summaries and then you can read what is important. The world is speeding up and we need to make sure that we have the skills that are able to move us there. Because otherwise then we may say, and this was the surprise at this conference where I allowed myself to disagree with the claim, well, you know, we are a people industry and customers don't want online check. I fully agree we are a people industry, but actually that doesn't mean anything with the customer doesn't want online checking because a customer has no need to see a receptionist to hand the ID and to retype something and the receptionist to retype something and then to sign something. This is a completely irrelevant part of the customer journey. So yes, if we use this person in terms of retyping to give you a hot towel or a cold towel depending on the weather, Then we're talking customer experience. Then we're talking a wow element for something that adds value from a customer perspective. So I would say that, yeah, working on the products and actually increasing the skillset that is able to develop these products.

SPEAKER_01:
And that's one thing I hear from quite a few hoteliers is just eliminating the need for those manual tasks like scanning the ID or swiping the credit card that can actually increase the relationship that the front desk is building with the guest and they can focus on the more important things and eliminate those logistics. Well, that was all that I had for questions. If you have any final thoughts or any other topics we didn't cover that you'd like to bring up, I'll open it up to you if there's anything else.

SPEAKER_02:
Thank you. Thank you very much. It was a pleasure talking to you. I think that we covered everything from a technology perspective. Thank you.

SPEAKER_01:
Thanks, Gran.

SPEAKER_00:
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.