“Robots at reception? No. But technology is absolutely crucial in our hotels”

The hotel industry is rare in that it is one of those sectors where technology will have “the least impact on human resources”, says Gonçalo Rebelo de Almeida, director of the Vila Galé Group. “In the kitchens of our hotels, there will continue to be people preparing food, in the restaurants our employees will continue to serve, and in the housekeeping areas the same will happen”.

The recognition of the importance of the human factor in hotels does not, however, express an aversion to technology, especially because Rebelo de Almeida, who has been with the group for 30 years and has a degree in Law but is self-taught in technology – “I fell in love with this area” – had, and has, an important role in the technological evolution of the company.

The group – which manages 49 hotels in four countries – was an early adopter of online marketing and the integrated cloud-based management system . Looking ahead, Rebelo de Almeida believes that artificial intelligence will bring functionality to customer service and response systems, whether for providing clarifications or making reservations .

“For a company that has a very consumer-centric vision, if I can provide service that has more information, with the most accurate information, that can quickly understand what kind of needs the customer has, this is where technology has more capacity than humans”, he stresses, in an interview with the ECO podcast, À Prova de Futuro, which is supported by MEO Empresas.

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The Vila Galé Group was founded in 1986. How has technology been used to grow the group? What were the major milestones?

The first major milestone, basically, was the opening of the first hotel in 1988, which obviously had to include some technology. Hotels have always existed, or at least for as long as I can remember, although when we started there were still hotels that did the entire process of registering guests' arrivals and departures on paper and using completely manual forms. From the very beginning, we acquired software called Property Management System to help manage availability and reservations and assign rooms and know which guests are staying in each room and for how long. This is the basic system in the hotel industry and so it has always been with us. The common billing system or the restaurant system is also the first technological adoption, but this does not represent any major differences. I would say that there are some milestones, back in the 90s when websites began to be used as a communication platform. Today this seems a bit ridiculous, but I lived through that scenario of creating the first website . Just so you understand, at the time I was in the marketing area and I was developing things in FrontPage and animated gifs, so this is a reality. I think that using the internet as a communication platform is a milestone. Then, following this, the other big milestone was when booking platforms and more transactional platforms started to appear in the tourism sector and, therefore, hotel websites themselves started to have small tools where customers could make reservations and then there was a boom with the appearance of Booking.com or Expedia. These are two big leaps because it started to open up the possibility of hotels being for sale in a much larger marketplace. This brought another big change, which is that in a model where prices were previously much more static, we moved to a dynamic pricing model, both availability and price can be updated daily and allow for price variations.

As already existed in aviation, for example.

But it is a major transformation in the distribution of the sector. People often talk about the model and I don't know what else, but the model has not changed radically, because Booking, Expedia and other travel agents are intermediaries, both online and offline, between the hotel and the end customer . Structurally, the model has not changed, but some aspects have changed, and one of these is dynamic pricing and dynamic availability . Hotels have the ability to put more or fewer rooms up for sale in a given period and to be able to increase or increase prices depending on supply and demand. This is a very significant milestone and then there is also a whole transformation in the world of communication, when more online communication tools begin to be used , whether in the form of search engine solutions, display solutions or advertising on other websites. This is also a major change, and therefore from the point of view of communication actions, which used to be very much one-to-one between sales teams. The hotel industry in Portugal used to do little traditional media , it didn't have budgets for television or radio, and it didn't do much press, so digital media, even these channels, have changed the way communication and advertising are done . Then the next milestone came with the arrival of social media . Here, the big changes, and basically grouping all of this together, have a lot to do with the side of communication, promotion, customer relations and customer acquisition. Then there is a hidden part, which has also undergone some evolution, and which has to do with software that helps to improve internal processes, document digitalization, and control of task distribution.

Your CEO said in an interview at the end of last year that the hotel industry must go hand in hand with culture. I'll use that phrase to adapt the question: does the hotel industry also need to go hand in hand with technology at this time?

There is no development of the sector without technological considerations . Yes, it is not possible, although these associations are of different forms, that is, when we talk about the association with culture, it is because it has to be part, deep down, of the product and the service, of the experience. Technology, in our case, is not an essential component.

They are not technology companies.

We are not technology companies, we do not sell technology and customers do not necessarily choose our hotels because of technology . Therefore, they do not come to buy technology from us. Technology is a means, in our case, it is an accessory, but absolutely essential , because today I could not communicate with customers, I could not run campaigns, I could not sell online, I could not manage the hotel if I did not have technology. It would be absolutely unthinkable today, with all the requirements that the market demands for analysis, so technology has to be there, but we are not a technology company.

It is absolutely critical to make all information available on online platforms and to have a good booking engine that makes it easy for customers to search for options and book quickly, securely and quickly. This is absolutely crucial. I cannot imagine a hotel business that does not have this basis.

Demands are rising as we become increasingly electronic, we have watches, smartphones, we are used to having information and features in various places. When we spend a night in a hotel we demand this too. What are the things you have to offer a modern guest?

It is absolutely critical to make all information available on online platforms and to have a good booking engine that makes it easy for customers to search for options and book quickly, securely and quickly. This is absolutely crucial. I cannot imagine a hotel business that does not have this foundation , because this is where the customer journey begins and where the first impressions of how this interaction goes are made. We then went a little further, developing a web app called MyVilaGalé, which aims to accompany the guest during their stay . Basically, in this customer journey, we start by trying to attract their attention with online campaigns, etc. Then, we complete the sale with this reservation, mostly through our website, although we have many reservations through other partners. And then the guest arrives at the property to experience the stay. And here we developed a web app, which is MyVilaGalé, an easy point of contact. One of the difficulties – hotels are quite large and very dispersed – was that the client had to know everything they could do, how much it would cost, and the opening hours. This was a huge time-consuming task for the teams, and therefore the clients felt a certain insecurity, not knowing if there was space, what the opening hours were, what the treatments were. Therefore, all the information about everything that happens in the hotel, be it events, opening hours, menus, all of that, and some of them with the possibility of reservations, was consolidated on a digital platform. And this was, we had already been developing this before the pandemic, it was accelerated and the level of use by guests is quite high. I would say that this is a significant part of it. Now we are going to have a new phase or a new chapter with the introduction of artificial intelligence tools in some of these solutions.

Can you give us an idea of ​​the kind of features this might lead to you offering?

Ultimately, where the greatest impact is expected to occur in this initial phase has to do with all customer service and response systems, whether for providing clarifications or making reservations .

Chatbots?

Chatbots or virtual assistants or automated responses, even if some of them are validated. We have millions of emails that we process in our reservation centers in Portugal and Brazil. In these online reservation tools, there will no longer be as much work with artificial intelligence, but there is still some work, both in phone calls and in emails, which still have some weight and are always done by human agents. There may be some gains here, even in terms of the amount of information that the guest can ask one of our agents. We currently operate 49 hotels in four countries and in I don't know how many different cities . And then each hotel has its own characteristics. The agent only needs to know when the guest asks whether there are trams leaving from Vila Galé in Alcântara to Terreiro do Paço or not. Customers can ask a number of questions. And in this ease of response and in this collection of information, artificial intelligence can help here, whether or not combined with human agents or, in some cases, autonomously.

There is this line between the traditional, the human face-to-face and the digital, in the hospitality industry. There are hotels where everything is done electronically, but they are different experiences. How important is human resources to you?

In our case, human resources are absolutely crucial and will continue to be absolutely crucial . Therefore, this does not have much impact… because if we think about the core of the hotel experience, we will continue to have people in the hotels providing the welcome that people normally identify as the reception of a hotel. In the kitchens of our hotels, there will continue to be people preparing the food and the basis of Portuguese cuisine will continue to be made by people. In the restaurant industry, our employees will continue to serve, open wines and serve customers. In the areas of housekeeping , room cleaning, and equipment maintenance. Therefore, we are, in fact, perhaps one of the sectors that, from the point of view of the operation, both in terms of the provision of services and products, will have the least impact on human resources . Therefore, some areas in the marketing area will be impacted, some things in the sales area or in the service area, which may be supplemented or replaced here. But in the main operation, we do not expect any reduction whatsoever in this area .

It's a rare sector, actually.

Yes. Due to the nature of the functions themselves. Obviously, if we want, there are experiments in some other countries, although they have not been very successful, which is to have robots to serve customers . And, therefore, to have robots at reception, or to have robots in the restaurant, or to print food. There are some innovations, but they have not been very successful and, at this stage, we are not in the least bit geared towards that . Now, from the point of view of customer service, yes, because it can greatly improve the quality of service. For a company that has a very consumer-centric vision, if I can provide service that has more information, with more accurate information, that can quickly understand what kind of needs the customer has, this is where technology has more capacity than humans. We are talking about memory and information present to the second. Now, there is a job that humans will probably leave behind, this bureaucratic, administrative part of all these processes and will think more about strategy . I usually tell my people not to worry because other needs always arise later. If we really think about these sales areas, the revenue management functions, for someone thinking about pricing strategies, did not exist ten or 15 years ago and, therefore, the dynamics of companies.

Opportunities open up.

New opportunities are always opening up and there is always someone who will have to work with these artificial intelligence tools, who will have to help shape them, who will have to feed content.

If I wanted to go in now and see how many coffees were sold in Rio de Janeiro in the last half hour, I could find out. This ease of access to information is great, and it is shared by the entire organization. The entire organization has been working on the same system for quite some time.

The group has 49 units, four countries, dozens of cities. How do you use technology to manage logistics, supply chain , invoicing, after sales and accounting? In each unit and as a group, what kind of things do you use to keep the group unified and at the same time with the characteristics of each unit?

In practice, one of the reasons why we have this relatively well organized is that many years ago we adopted, we were somewhat early adopters , a solution that we ended up developing on a bespoke basis , because at the time I developed it internally there were not many solutions capable of meeting the needs. We have a single platform that is based on a database and a system that is hosted in Portugal, in data centers in Portugal, but which is ultimately used by different geographies and, therefore, all of our employees, all of our hotels work on the same platform. Therefore, if I wanted to log in now and see how many coffees were sold in Rio de Janeiro in the last half hour, I would be able to find out. This ease of access to information is great, it is shared by the entire organization . The entire organization has been working on the same system for quite some time. We developed this in 2008, with a system that was already developed entirely web-based , with a cloud concept. It is a private cloud , but where there are no longer machines installed in each of the units, and there is no longer a local database, and there is no longer software installed in each of the units. So, today this is something more or less basic, and the evolution has gone in this direction, but in 2008, when we developed it, there was a factor that seems a bit silly today, because the entire system worked via the web, and the web depended heavily on the speed of the internet connection. And so, nobody remembers, but in 2008, 2009, the connections were one mega, two mega, four mega in the cities that already had more. We are talking about a reality in which, at the beginning, there were some obstacles, and the system was slow. But at the time I thought that speeds will never go backwards, so technology will evolve and from now on the system will only naturally become faster due to the availability of greater bandwidth. And that's what happened. And today it's not an embarrassment at all.

Do you have a Chief Technology Officer? When choosing your teams, how important is their experience or technological training? Everyone has to deal with technology in some way, as you say, on your platform. Do you provide training? How much do you invest?

We obviously have an IT department, which is currently divided into three main areas. We have a department that manages infrastructures, networks and connectivity, and therefore internet connectivity, manages the machine fleet, manages connections, all the infrastructure. This is one of the components. Then, by our choice, we have an internal programming development department, where we have a team of eight people who only develop and maintain our applications . And then, more recently, but it has been around for a few years now, we have a Business Intelligence department, which is based on all the data that is produced, not only by our platform, but by others, which produces all the analytics , data and reports in this Business Intelligence area. Obviously, these play a big role in building the ecosystem. Our management base is based on our software. At a certain point, everything that is core to us and modules that are core to managing our operations were developed by us, and then we have a set of satellite solutions, software that is on the market by subscription , today they are almost all by monthly subscription and some based on users, others based on the number of hotels, etc., with subscription models. Most of them are integrated with our system, therefore, with APIs, which, basically, revolve around all of this. And, therefore, solutions to manage customer comments on different online platforms, solutions to distribute our prices and our inventory through booking sites, solutions for managing maintenance of things that are not core . Some time ago I made a list, we work with approximately 24 technological solutions in addition to our own, with small modules that all gravitate interconnected. It is an architecture that is obviously challenging, but the API and web connection models also facilitate this work.

And what is your role in all this?

I confess that I am very involved .

That's why you're here [laughs]

Strangely enough, despite having a degree in Law, I have been there for the first time during this entire technological development or transformation. When I started working at the company 30 years ago, there was very little technology, it wasn't even available, and it wasn't because the company didn't adopt it. And I fell in love with this area . I mentioned earlier that I was involved in programming things on the website or that I created the first application in Access for managing sales teams. So I was a bit self-taught, taking courses and talking to people. So this is an area that I particularly enjoy and that I have dedicated myself to in recent years, and I am very involved in its design and architecture. Obviously, I count on the team. This part of the IT department follows these implementations and developments, but ultimately the suggestions and needs come much later than the organization. In addition to design, I also build a bridge, which is a difficult role, between the operational needs of those who are on the ground and who I understand, and the transition from that to the technological response that is necessary . It's a role that I particularly enjoy playing and I can't even stop doing it because it's an area that I'm passionate about.