Change has not been one of the watchwords of the hospitality industry, according to The Student Hotel’s Chief Digital and Experience Officer Mark Liversidge. “The hotel business, in my humble opinion, hasn't really changed in generations,” he says. “It runs on the same formula. It's driven by the same industry metrics with the same workaround to overcome the shifts and changes that are going on around it.
“Brand portfolios delivered by the hospitality management companies are massive. They've got up to 20, 30 or 40 brands in their portfolios, yet fundamentally it's all just been the same space and service with different carpets and wallpaper.
“The engine it works on is the same. Most of the guest utility is the same. The decision making of the business models is the same. It’s simply a drive to get more flags in the ground and operational rooms. Fundamentally, none of it is serving the evolution of the guest. And their ability to pivot is hugely constrained. Conventional hospitality technology does not allow them to move with fluidity or agility.”
What we’re trying to do is different; staying at TSH is not just about the rooms, it’s about a community experience. TSH’s hybrid hospitality concept is designed to welcome students, tourists, neighbours, entrepreneurs and businesspeople to learn, stay, work and play, all under one roof. From hotel, student rooms and co-working spaces to auditoriums, gyms, event spaces and social initiative programming, Its a place where people can connect and learn from one another while growing into a vibrant community.
The Student Hotel began life, as the name suggests as a provider of purpose-built student accommodation (PBSA). That is also a rapidly evolving market, as higher education morphs from a concentration of 18 to 24 year old’s towards lifelong learning models, another trend Liversidge sees being accelerated by Covid. TSH’s hybrid personality begs the question of where The Student Hotel fits between hospitality, workspace and PBSA. In fact, they are somewhat converging, as students demand higher quality accommodation while workers and travelers have increasingly fluid notions of how they go about their respective endeavours.
Working for change
Like universities, who are coming to realise that they are not accommodation specialists and would rather hand off to third party expertise, Liversidge believes the corporate world is likely to see a revolution in office space. “Companies don't want to be carrying the cost of large spaces in city centres or in major hubs at high cost that is not fully utilised. They're going to want to hand that over to other people whose specialisms are in real estate as a service and have more fluidity in what space they need and when they use it.
“We’re heading into a generation of more freelance contract work, where people will come together in teams on a fluid, organic, time-specific basis. You won’t be contracted to a company so much as contracted in for a particular activity or project within a company. And that company itself may only exist for a certain reason for a short period of time. People are going to say ‘I want the ability to step out of my personal space and go to a dedicated workspace which is set up for that and has the facilities and amenities for that. And from a wellness and mental wellbeing perspective, it should give people that ability to mix face to face rather than solely via a screen.
“So you’ve got three things in a state of flux that are going to be fluid in the immediate future. The challenge for us, at TSH, is to bring them together harmoniously, each part clearly defined, and as a profitable business. Technology will play a critical role in achieving this.
If you want to do things differently you have to overcome the constraints of conventional industry technology engineering. The Student Hotel has been pushing to break free of the “standards, systems and platforms” that “just don’t exist to support our desired fluidity”.
“We’re on our transformation journey, and we’ve made some bets with innovators and early leaders who are bringing smart, dynamic tooling to the table to be a technology leader, breaking out of the conventional architecture and systems that just can’t cope with hybrid space use and operational fluidity that we believe are the basis of future business profitability and growth.”
Middleware, Liversidge argues, is the key. “Middleware is a critical path for the industry because so many of these systems are linear and single use, but we’re trying to dimension our spaces to be multi-use. You need a logic layer that can connect those individual systems and allow you to manage that flexibility. We partnered early with Ireckonu who developed a middleware logic layer specifically for hospitality and over the last couple of years has evolved into a rich product set that has enables us to move rapidly with our technology transformation.
The other big thing to address is that we're clearly now in the era of hyper individualization, which we see delivered by the digital retailers and service providers. People now expect you to understand who they are and serve them to their distinctive unique behavioral needs and journeys.
“And again, the hospitality space in its broadest context just doesn't do that right. It actually has abandoned the original fundamentals of hospitality in personal service and it's now a homogenized thing at a time when everybody wants to get that individualisation. So the other critical thing about middleware is that it gives you the ability to start creating a core central customer data platform (CDP) with individual lifelong guest profiles.
“I would argue that a middleware logic layer is fundamentally going to be critical to almost any multi-product hospitality operator in the next five years while the operational systems try to catch up. And then if you look at the key systems, the property management system (PMS) in our category, they’re very limited and very linear. Most of them are based on the same dimensioning, which is the historic per room per night stay.”
The problem, Liversidge maintains, is achieving the optimal use of space. A fully booked hotel may have all its rooms booked according to the legacy system, but upwards of half of the ‘space time’ is never used. Once the time has passed, so has the opportunity to leverage its use and sweat the asset for incremental revenues.
The Student Hotel has been partnering with Mews Systems in delivering a PMS which “will fundamentally allow us to drive our dynamic space x time model more intently in activating all types of space use within a single harmonized technology system.”
That technology architecture is designed to deliver The Student Hotel’s brief as a hybrid space for blended living, blended use. It’s a PBSA, it’s a city hotel, it’s serviced apartments, it’s a workspace, it has corporate business meeting, event and – increasingly – office space. Then there is lifestyle, it’s also a place to hang out in the day and night-time: gyms, wellness spaces, learning events, mini cinemas, gaming theatres and “what we call our living space, where all of those different tribes come together”.
“I'm having to design a technology architecture for a business model that's never existed before and is still nascent in its formula. It's not fixed as to how it's going to be. And I'm pretty confident that three years from now, it won't look like we think it looks today. And three years after that, none of us know. So we have to have some agility in what we're trying to design for today to be still purposeful within that natural five to seven year technology life cycle that we all live with.”
The blue cube
Liversidge’s approach is to abandon traditional hotel thinking and break down the space. “I simply think of a blue cube and that blue cube is a metre by a metre by a metre. And we ask ourselves, how do we activate that blue cube – and we have hundreds of thousands – in the most optimal and efficient way that people can use them purposefully as individuals or groups? And how do we make sure we're turning them over to other people to use as quickly and as efficiently as possible? As an example, many coworking places will have a fixed membership quota. And they’ll say they’re full, but you go there at 10 o'clock at night, it's empty. You go there at six o'clock in the morning, it's empty. There are people who have a need to use space in off-peak hours. How do you reach them? And how do you set up the technology to activate them?
“The other side of what we're thinking about is our guest. Our business success is singularly going to be built on the identification and serving of an individual guest who is increasingly expecting hyper-personalisation. So we've got to make sure that we have an ability to immediately capture people's profiles in the broadest possible dimensions that we can at every possible opportunity, but then intelligently and restrictively use them, because we don't want to be big brother. We want to use it with respect, intelligently and infrequently, but when we use it, it really is a moment that matters for the guest. We are in the process of building that up on our proprietary front-end platforms, based on the core middleware and operational management system.
“We've built an entire new front-end, which essentially is our shop window, with a new website and the booking engine. We've built our own new proprietary spaces. We built a website using React JS. To give you an idea of who else uses React JS, people like Netflix and Airbnb. And why do we want that? Because it enables us to modify and deliver faster, stronger UX, as well as critically, really leading-edge capabilities to have dynamic and changeable experience, which is going to be fundamental for us in telling our brand story and experience, along with capturing revenue opportunities.”
The new booking platform, now into phased deployment, again breaks away from the traditional linear single hotel product booking engines, moving to a multi-product basket to deliver a distinctive branded shopping experience as TSH seeks to sell packages meeting individual guest and group needs, to wrestle back control of the customer from the intermediary distribution platforms and build a customer lifecycle model.
Finally, there is data, a crucial pillar of the knowledge economy, “how we start to understand the value of the data we’re harvesting and the sensitivity and meticulous control to utilise that data to benefit both the individual customer and for the company by aggregating that into macro indicators.
All of these elements of the technology architecture are being delivered to put the individual customer in “total” control of their own journey.
“We’ve made three massive transformations in the last 15 months; delivering a new website and booking engine, transformation of our operating management system and middleware logic layer, and finally complete swap out and standardization of our on-property technology.
This latter proprietary technology stack is called HiB (Hotel Tech in a Box), which is dropped into each of our operating properties, identikit right down to the cable layout in the equipment rooms and integrates with deploying HP Aruba hardware for optimal connectivity and space monitoring. And we’ve overlaid that with PRTG monitoring over more than 4,000 data points so that we can, from a single central perspective, constantly monitor, moderate and control our technology stack which harmonizes between the operational systems and the actual property.”
Survival of the Flexiest
It’s a system The Student Hotel has been able to stress test during the pandemic. “Covid has accelerated the stress and flux that’s coming on the hotel, workspace and leisure categories. If it had been a year earlier it would have been a horror show for us because of all the singular systems, so we have been fortunate to deliver the new core systems and take advantage that part of the design has our own Api to enable fast deployment of new guest experience services. One thing that we quickly invested in was a belief that organisations would need enhanced broadcast to reach their dispersed teams and audience, so we created and delivered the TSH Media Studio, which essentially is building on the deployed broadcast quality connectivity and enables use our meeting spaces differently, which has been super, super successful already.
“Covid has re-emphasised we've made the right decisions in the direction we're taking with our technology, showing the critical need for the flexiest, most agile systems. Furthermore, Covid hit in the middle of our transformation program and created a huge challenge of project delivery, which I'm very proud of what was achieved, not only by my team, but our vendor partners, in still delivering on time and without any impact on business operations, really encapsulating the can-do spirit of TSH.”
As for the impact of Covid on the sector, Liversidge says, “it will be Darwinian, those that have planned and deployed the flexiest technology architecture will thrive and grow, while the operators that are stuck with the out-of-date and linear product technology stacks will struggle to respond to the dynamic changes in the market and meet customer expectations.”
And beyond Covid 19? “Space is going to be redefined. Let’s focus explicitly on the hotel bedroom all over the globe: you know what you’re going to see. You walk in the door, the wardrobe is to the left, the cubicle bathroom is to the right. Straight ahead: double or twin beds. In front of that a desk on the wall with a TV above it. And probably a bit of shelving and one comfy chair in the window. And that has not changed in literally the better part of a century.
“People are going to look for different spatial experience, they are going to want a private space to rest and revitalize, a cocoon, a space designed for wellness. Why is there a desk when people now want to work collaboratively? Get that out of there. Starbucks has been the destination of choice for people grabbing a workspace for the better part of 20 years around the globe, that should be a natural use of hotel/living space. Just rethink and reimagine the whole space. Maybe people want individual cooking in a room, or VR gaming, or exercise without going to the hotel gym. How do you design space for that? And you’ve got to create more inspiring and flexible space for people to engage in your public spaces. By and large it is the same fixed formula, yet customers have differing needs for space at differing times. We are delivering lounge spaces that are set as hubs to provide for the needs of the differing customer tribes at different times of the day.
Sustainability will also be crucial to hospitality and technology in the future, says Liversidge..
“I fundamentally believe the way we build and operate property will change and this will be driven by the financing. The financial markets will drive and demand smarter more environmentally sound thinking about the physical asset because people are making a 20-year investment. Those investment managers are smart enough to know that five years from now a very heavy metric of value is going to be based on your green footprint.
“We're working super, super hard on this. We're trying to use sustainable elements and base components in all of our buildings. I'm very pleased to say that we opened in Delft a couple of months ago where all our public spaces, workspaces, as well as the in-house restaurant are designed with circular design principles. We see the property as a live operating lab to test circularity and sustainability in the built environment. We're exploring smart building design and management, and behind this we are making conscious choices in technology deployment and its use to bring energy efficiency.
TSH digital and technology group operates with substantial outsourcing, built around four key partnerships [see box] working collectively as a harmonized technology team. After a lifetime of partnerships with businesses, governments, sports, entertainment and charities, Liversidge is both enthusiastic and pragmatic. As far as technology is concerned, it’s not about the technology (“it’s all good tech if they’ve got to the shortlist”), but about the people.
“It’s really about where they’re going, how quickly, and identifying how that can be harmonised between both parties for mutually beneficial time-based outcomes and milestones. There are going to be moments of failure with technology. You have to accept they’re going to happen and have tolerance on both sides. And that tolerance is based on that harmonised milestone plan. You break it down into an annual horizon and a quarterly horizon, then accept that there’s going to be a bit of a zigzagging journey to get there. And that gives you a degree of manoeuvrability when you have those inevitable ebbs and flows of any relationship. You need a collective group of people on both sides who have a connection with each other and see themselves as one team.
“And the other side of this is ‘stinky fish’. You’ve got to have truth and reconciliation when something’s gone wrong to make sure you don’t make the same error in future and it doesn’t cloud the working relationship. And another dynamic you will handle in deploying any leading-edge capability – which happens in technology a lot – is that if you pick a fast growth company as your partner, you’ll inevitably stop being the shiny new customer at the top of their client list at some point. You’ve got to address it on both sides, acknowledge it and ensure your interests are protected in formal documentation and informal people connections, while openly supporting the partners growth.
“This openness has been really important with the Covid situation. Right now we’re having constant conversations with our core partners because all our timelines are changing for reasons that are, in most cases, out of all our control. So let’s not all get upset about it. Let’s just sit down, be open, supportive and reharmonise on the new way forwards. And go again. This open and pragmatic approach is the reason we have delivered our transformation during this global crisis, preparing our business model to grow as we move into the future”
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