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The Hongkong and Shanghai Hotels (HSH Group) owns the five-star luxury hotel group, which will replace its property management system built by Oracle Hospitality and its central reservation system with a new enterprise platform from Shiji, which made the announcement Sunday in Beijing. The Peninsula Beijing will be the first to switch.
Shiji has had its new enterprise platform in pilot testing with three unnamed European hotel groups for the better part of a year, the Beijing-based tech company said. But the Peninsula is the first global hotel chain to adopt it, and this is the first formal word of the system’s existence.
The news comes as many other global hotel groups are rethinking their hotel stacks. Accor hired Sabre earlier this year to move from an in-house property management system and central reservation system to one Sabre will build in a cloud-native platform. InterContinental Hotels Group (IHG) switched over last year to a new central reservation system built by Amadeus.
The property management system is a room-based database used for on-site operations such as checking guests in and out. For context, subscribers to Skift Research can read The Hotel Property Management Systems Landscape 2020. The central reservation system helps hotels distribute their rates and inventory and track bookings.
Until now, Shiji has been on an international acquisition spree for hotel tech. But critics said it only offered a patchwork portfolio of point solutions.
“We’re bringing a core platform that manages the hotel’s workflows and integrations,” said Kevin King, Shiji Group’s chief operating officer. “But we built it in a way so our customers can change the entire user interface with their own if they wish. They can use our Infrasys solution for hotel restaurants, for example, or plug in a different system to do that function.”
Shiji’s new platform, deployed on the Amazon Web Services (AWS) global cloud platform, puts it into competition internationally with players such as Amadeus, Oracle, and Sabre.
“This deal signifies Shiji’s ability to truly partner with a blue-chip brand and cooperatively design a major new solution which delivers full-service capability,” King said. “It brings together the technology we have been building and acquiring over the last few years with a central platform hotel companies can operate off.”
One significance of Shiji’s new contract is The Peninsula group’s global footprint of ten properties, with three under development. Local, regional, and international requirements differ, leading to complications when implementing tech.
The deal and new platform put Shiji in direct rivalry with Oracle Hospitality, the most used property management system by larger hotel companies worldwide.
Oracle’s various property management systems — including Opera, its best-known one — run at close to 40,000 properties. For years, the company had let Shiji be the official reseller of its systems to hotel companies in China. That deal ended in June in light of increased competition between the businesses. Oracle’s various property management systems — including Opera, its best-known one — run at close to 40,000 properties. Oracle has been revamping its technology with a new cloud-based system and architecture and has been adjusting its commercial terms for hoteliers, too.
New Ways of Selling Hotel Rooms
Shiji has built its enterprise system as a platform where hotels can choose to add various functionalities. One of IHG’s reasons for switching to Amadeus’s system was that the Madrid-based tech company said it could help offer attribute-based booking. Marriott’s in-house system has been testing attribute-based booking, too.
Attribute-based booking comes in different flavors, but here’s the basic concept: A traveler picks the things they want in a room — such as a king-size bed, extra-soft pillows, or a location such as on a high floor and in a quiet zone of the hotel — à la carte. Once they’ve selected a bundle of options, the hotel group provides a custom price.
Legacy tech systems aren’t built to deal with attribute-based booking, so providers are retooling the tech structure to enable it.
“Since we had the opportunity to build the core structure of the Shiji Enterprise Platform from the ground up, we built the foundational abilities needed for attribute-based booking into the basic structure,” said King.
These and other companies are competing as hotels shift from on-premise systems to cloud-based offerings. Cloud-based systems that use modern communication methods can be more versatile and help hotels adapt to changing needs and differentiate themselves from their rivals. Changes in scattered on-premise systems can require a sluggish global rollout of software updates. In contrast, companies manage cloud-based systems at the corporate level, so they can activate functions in each location worldwide quickly and seamlessly.
“We believe that the design and configuration of an enterprise solution, to which hotels attach and consume real-time corporate strategies, scalable products, and aggregated global data, will enable greater clarity about who their customers are,” King said.
Shiji was in the news earlier this year when the Trump Administration blocked the sale of U.S. company StayNTouch to Shiji. President Trump’s executive order in March said the company’s ownership by Chinese tech player Shiji Group could have “threatened U.S. national security.” Shiji said the order was wrong because it didn’t access StayNTouch’s customers’ guest data. U.S. hotel operator MCR Development has said it would later this month buy StayNTouch in a $46 million deal with cash and earnouts.
The Peninsula’s Long-Term Bet on Tech
Before the pandemic, the Peninsula Hotels rolled out the hotel equivalents of “smart homes,” giving guests control over their room’s temperature, lights, and room service via a tablet. The group in August moved those services onto guests’ phones with PenChat, an around-the-clock e-concierge, which guests can tap via WhatsApp, Facebook Messenger, and WeChat.
The Peninsula Hotels has a long history of tech innovation under Shane Izaks, group director, information technology for Hongkong and Shanghai Hotels, the parent company. Izaks has formulated and implemented the information technology strategy at the group and operational levels and overseen its research-and-technology office, focusing on testing guest room gadgets.