To Change on Not to Change

By Luke Mellors, Guest Contributor | June 01, 2005

Recently I had the pleasure of talking to some University Students on innovation in our industry. During my talk one student asked -- •Aren't people generally resistant to change?' The answer is that many people are resistant or perceive change to be negative. In response I asked her, "How she felt when someone said I think you should change your hairstyle or your clothes." It is not uncommon for people to be reluctant towards change. However, the reason change is viewed as negative is because it is viewed as only change not improvement.

The real impetus to change for anyone has to be that it will make something better and I can see the benefit. It is strange how many hospitality organizations change their systems without considering how it will make them better. So why would an organization spend a lot of money on a system that was going to do exactly what the old one did? It may sound absurd but this is the rule in our industry not the exception. Many companies spend a great deal of money simply getting an updated version of a system that does exactly what their current one does.
Organizations need to ensure that investigations into the benefits of deploying technology whether it be for a PMS, POS or a range of other systems are completed and that the expenditure and cost for the new system can be justified with respect to a return on the owners, companies or organizations investment.

What I told this young very astute University Student in response to her questions was that if change was for the sake of change then not only would people be resistant to it but it would never work in a fashion that improved the business. Change cannot even be for marginal benefit it has to be a concrete and measurable if not noticeable benefit to an organization especially when it relates to a technology innovation or deployment.
The completion of an effective business case that fully rationalizes all elements of the project is imperative to both buy in and future measurement of the success of the project. Firstly, why do we need to make the purchase? What factors currently exist that require us to shift priorities and spend in this particular direction? Is it the effectiveness or the performance of a system that is the main justification of the expense? Is it improvements or changes in industry standards or technology innovations that are the main reasons to look at this investment? Is it the functional requirements of your business and that they are not currently being met by the existing product?

Be very careful not to use a business case as an after thought to try and get approval for expenditure. If you do this then it is likely that you will not consider all the key elements and there is a higher risk of the technology failing to provide the business with the tools it requires. The business case should be the first port of call on a road to effective implementation of technology. It should be an unbiased acid test of whether the business needs to spend money or not and IT managers should ensure that if the business case does not stand up that they walk away because it will likely not be a value focused investment.

The key is to start out with a question such as: Does the hotel require an investment of X amount to install a new Property Management System in order to increase service quality and to improve the quality of information it has on its guests?

The second step is to validate the question -- quite simply does the hotel need to improve service quality and how is it perceived that an investment in a PMS will service this. Then through looking at comparative information and benefits of new systems and functionality the report or business case will quite easily evolve into a value assessment of the proposition.

This may sound awfully academic however if you do not validate the need or the priority and if you do not define what the success of an installation is and can measure it then the investment is not an investment but a donation. To invest in something you must have a desired return, there must be a business driver that suggests that this investment is good for the business. Otherwise it is change potentially without merit and this is not only hard to sell but also very difficult to make successful.

Also remember that the cost of new technology if it works just like the old one did will never be recouped. Drive value through change by creating an effective, profound and valid business case that will likely enable IT managers to drive better solutions for better results.

In conclusion, spending money on technology without a thought out validation and justification of why the technology needs to be changed or implemented does not influence value added IT and creates if not promotes negative perceptions that currently exist about technology in our market place. If, as an IT manager, you want to be recognized for delivering good value solutions that help drive the profitability of the business you must learn to approach all technology investments from a business case perspective. It will not only provide you with excellent justification to spend money but it will likely improve upon results by focusing the efforts directly on where the business needs them.

Luke Mellors is Head of IT at The Dorchester Hotel, London. This column is part of an ongoing series of articles entitled, "Influencing Value Added IT."

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