eHotelier recently had the privilege to interview Frank Wolfe, (pictured right) the Chief Executive Officer of HFTP (Hospitality Financial and Technology Professionals).
He sheds light on his organisation and issues facing those who work in the support sides of the industry.
Let’s start with a ten second rundown on HFTP. What’s the value to members?
Well, the reason that we are in business as a non-profit is just to provide education – period. We also promote the hospitality industry as a valid profession from either the finance or the technology side of the business. We have two certification programs and those are the most important things for our association. There are sub categories, like conferences – we do the Hi-Tech conference – webinars, and many other things, but they are really not our primary reason for being.
Traditionally in hotels, IT was part of finance department. Now, with the evolution of the Internet and social media, the marketing department is having a much bigger influence on the role technology plays in a hotel. Are you seeing that around the world?
Yes we are. It’s kind of interesting that revenue management has come into its own. Practically every hotel now has a revenue manager, so that is a blossoming profession. And yet, a lot of hoteliers still don’t have a handle on what their distribution costs are. That’s a big mission that we need to work on – how to calculate what distribution costs are as part of the updated Uniform System of Accounts that we publish in the U.S.
In North America where the Uniform System of Accounts is widely utilised, does it make things more transparent and more consistent?
One of the reasons why we started the Common Practices Project is because we want to be able compare businesses around the world for our members.
If an Australian wants to buy a hotel in the US, the Uniform System of Accounts makes it easier for the buyer to compare costs. But let’s say an Australian wants to buy a hotel in India – it’s totally different because their common practices are so much different from the Uniform System of Accounts.
For example, in the U.S. we have steam pans that are aluminum and not terribly expensive, but in Hong Kong, they have these immaculate, bronze pans that costs thousands of dollars, so they are actually a capital item. If somebody is trying to buy that hotel and doesn’t make that connection….
Asset management companies have come into the industry and they are used to valuing commercial buildings, but hotels are a whole different ball game. Right now, there really isn’t any way to compare properties across countries. That’s why we are trying to do a Common Practices project.
It’s a big issue, particularly with China – that market is growing so much, both with global companies wanting to go into China, and with Chinese investors looking for global markets. We need a way to compare value.
Technology brings up another issue. If an asset manager comes in and they don’t know about technology in the hotel, issues can arise. They may see an XZY system, but it might be a legacy system. Perhaps the only way that legacy system can be updated is to basically throw it away. A prospective buyer of that property needs to know if the legacy system can be upgraded, or if not, how costly the replacement system is.
Furthermore, what are the minimum levels of technology that should now be in a property? All the recent tech developments with guest-centricity have business implications, so education is definitely needed in answering these problems.
It has been difficult for our members to get investments because the industry is slower than we would like, but at the end of the day, we have to, because guests expect their hotel to provide at least the same technology they have at home.
We’ve heard about technology and the guest, but what about technology benefiting the hotel operator? Is it that technology used for things like asset tracking are too large a capital investment?
Not necessarily – RFID has gone down in price significantly over the past three years, and while it’s still not cheap, it’s getting there. Now we’re getting down into the cents range- which doesn’t sounds like much but once you start applying it to 10,000 products, it starts to become significant money. Barcoding was used in the industry for a while, but that has kind of started to fade a little bit and we’ve moved on to RFID or other inventory geolocation devices of some sort. But when it comes, it’s going to be phenomenal, because all that someone has to do is come into the room with some sort of handheld and you will be able to get an inventory of everything in the room. Plus, you’ll know where it went and the incidence of guests permanently borrowing things on purpose or accidentally will decrease.
The timing of technology installations is another challenging issue. I was speaking to a gentleman from Hawaii the other day and he was trying to get an international project through that they had been working on it nine months. Well, he just got approval, but now there’s no point in doing the project anymore because technology has leapfrogged. We’ve got to do the things we need to with more expediency.
What was the greatest influence on your career, and what piece of advice would you give to hoteliers coming into the industry today?
The greatest advice that I would give hoteliers coming into the industry is to do everything you can possibly do in a hotel. You may have to volunteer for it to do it! Become a well-rounded person in the hotel because a hotel is such a dynamic being that someone can’t really understand the whole thing until they made the bed, they’ve emptied the trash, they’ve waited the tables – they’ve done everything. To become a General Manager, you’re really going to have to understand hospitality, and you have to have been in the trenches.
My biggest influence – I got into this industry by basically working in the Student Union at University. We had a couple of suites, some meeting rooms, and we got to throw parties and make people happy. I thought – wow this is really cool – it was the whole hospitality thing. It’s a part of life where you make a lot of people happy and get them to come back. And it’s a lot of fun.
