CHAPTER 5

CHAPTER 5. HOSPITALITY MANAGEMENT AND THE INTERNET

Objective: This chapter introduces the concept hospitality management through the use of the internet. Electronic Commerce (e-commerce) is one of the most common services on the web that is used by the hospitality industry.. After this chapter, the students must be able to define and expound the definition of e-commerce, the span and scope of e-commerce, its applications to the hospitality industry and be able to tell some of the barriers and technical components. Figure 5 shows the e-commerce concept

Topics:

Ø Electronic Commerce (E-Commerce) .:. Span and scope of E-Commerce

Ø E-Commerce applications for hospitality organizations

Ø Technical Components of E-Commerce

5. 1 Definition

E-commerce (electronic commerce or EC) is the buying and selling of goods and services on the Internet, especially the World Wide Web. In practice, this term and a newer term, e-business, are often used interchangeably. For online retail selling, the term e-tailing is sometimes used.

It is the use of communication technologies to transmit business information and transact business rather than via paper. Taking an order over the telephone is a simple form of EC. Commerce conducted via the internet is also called EC, but commercial exchanges on the internet are only one of several advanced forms of EC that use different technologies, integrated applications and business processes to link enterprises.

5.2 Span and Scope of E-Commerce

E-commerce starts with the development of the internet and subsequent development of e-commerce. Its scope is in proportion of business involved in e-commerce, type of trade being conducted, business to business, business to consumer and consumer to consumer (e.g. eBay) and their different needs and systems

5.3 Barriers of E-Commerce Website

Barriers: identifying and meeting customer needs, channel conflicts (e.g. traditional outlets of a business may suffer), scarcity of skills, design elements, site downtime, financial resources, international and legal barriers, lack of trust (in reliability of system and security of payment), customer attitudes.

Solutions: government initiatives and support, (Electronic Communications Bill 1999 and subsequent legislation) AEB (Alliance for Electronic Business), software houses, case studies of success

5.4 Applications of E-Commerce

Hospitality is said to be "kindness in welcoming guests or strangers."

E-Commerce can be applied to the hospitality industry in many ways. Primarily e- commerce is used to seek and register new business. Hospitality businesses are setting up shop online, allowing potential customers to see what they have to offer, view photos of their amenities and services, and even to make reservations and purchase services.

The primary goal of hospitality businesses in terms of e-commerce is to drive revenue while showing customers first-hand and realistically what they can expect to experience. After all, hospitality is about meeting expectations.

Effective hospitality web sites will offer itemized lists of exactly how much each service is, photos of the facility, wording that is straight-forward and doesn't make something sound better or worse than the services or products that are actually offered, and ways you can purchase the goods or services.

Many of the larger hospitality businesses already offer ways you can make purchases on their e-commerce sites. They have found value in showcasing what they offer and making purchases. They are making money by allowing visitors to their e- commerce sites to make reservations and spend money.

For example, hotels can create e-commerce sites that allow visitors to find out whether rooms are available for rent for particular dates. These sites can then take credit card information and other payment types, so customers can reserve rooms.

Restaurants can create e-commerce sites that allow visitors to view menus, view photos of the foods offered, and even place orders or make reservations online.

Service clubs and organizations like hunting, golf, or boat rental clubs can create e- commerce sites that allow visitors to view which dates and times are available for reservations and make purchases.

Cruise ship companies can create e-commerce sites that allow you to view which cruises are available on which dates, what types of rooms are available, and their prices. These sites then can allow customers to make reservations or purchase cruises.

Taxi companies can create e-commerce sites that allow you to see how long it could take for a taxi to pick you up at a particular destination, to get a cost estimate, and to place a taxi order.

Sports organization companies can create e-commerce sites that allow you to view schedules of the sports teams, find out which seats are available for which games, and even purchase tickets and other merchandise.

In addition, many hospitality companies find it fruitful to go so far as to sell advertising on their sites and allow other, related hospitality companies to link on their sites. This provides customers a chance to visit the companies' affiliates and easily plan entire weekend or vacation getaways in just a few minutes.

5.5 Technical Components of E-Commerce and Organizational Aspects

Ø Sufficient work done in market research and analysis. E-commerce is not exempt from good business planning and the fundamental laws of supply and demand. Business failure is as much a reality in e-commerce as in any other form of business.

Ø A good management team armed with information technology strategy. A company's IT strategy should be a part of the business re-design process.

Ø Providing an easy and secured way for customers to effect transactions. Credit cards are the most popular means of sending payments on the internet, accounting for 90% of online purchases. In the past, card numbers were transferred securely between the customer and merchant through independent payment gateways. Such independent payment gateways are still used by most small and home businesses. Most merchants today process credit card transactions on site through arrangements made with commercial banks or credit card companies.

Ø Providing reliability and security. Parallel servers, hardware redundancy, fail-safe technology, information encryption, and firewalls can enhance this requirement.

Ø Providing a 360-degree view of the customer relationship, defined as ensuring that all employees, suppliers, and partners have a complete view, and the same view, of the customer. However, customers may not appreciate the big brother experience.

Ø Constructing a commercially sound business model.

Ø Engineering an electronic value chain in which one focuses on a "limited" number of core competencies -- the opposite of a one-stop shop. (Electronic stores can appear either specialist or generalist if properly programmed.)

Ø Operating on or near the cutting edge of technology and staying there as technology changes (but remembering that the fundamentals of commerce remain indifferent to technology).

Ø Setting up an organization of sufficient alertness and agility to respond quickly to any changes in the economic, social and physical environment.

Ø Providing an attractive website. The tasteful use of color, graphics, animation photographs, fonts, and white-space percentage may aid success in this respect.

Ø Streamlining business processes, possibly through re-engineering and information technologies.

Ø Providing complete understanding of the products or services offered which not only includes complete product information, but also sound advisors and selectors.

Naturally, the e-commerce vendor must also perform such mundane tasks as being truthful about its product and its availability, shipping reliably, and handling complaints promptly and effectively. A unique property of the Internet environment is that individual customers have access to far more information about the seller than they would find in a brick-and-mortar situation.

CHAPTER 6

E-INFORMATION AND DISTRIBUTION SYSTEMS

Objective: This chapter focuses on applications of information and distribution systems that provide interfaces to each of the hospitality business functions. E-information and distribution systems use technology to provide communication among interdependent operating units, which permits the staff members to focus on the core competencies of creating memorable experiences for the guests of hotels, restaurants, recreation facilities, entertainment venues, and travel companies.

Topics:

 Hospitality functions
 E-Business process
 Enterprise resource planning systems
 Artificial Intelligence

It is said that hospitality e-commerce consists of transactions and interactions between the business and customers (guests), employees and other businesses. It is recognized that the nature of the business-to-customer transactions are personal and intimate, which somewhat limits this aspect of e-commerce in the hospitality industry. These limitations, however, do not apply to the e-information and distribution systems that help enhance productivity for the hospitality businesses.

6.1 Hospitality Functions

Hospitality operations are quite complex due to the need to manage every moment that comprises the guest experience. E-information and distribution brings together all of the business functions that contribute to the operation of successful hospitality organizations.

Business functions of hospitality organizations include:

 Marketing
 Human resource management
 Accounting, and
 Operations
.

6.2 E-Business Process

Electronic Business, or "e-Business", may be defined broadly as any business process that relies on an automated information system. Today, this is mostly done with Web-based technologies. The term "e-Business" was coined by Lou Gerstner, CEO of IBM.

Electronic business methods enable companies to link their internal and external data processing systems more efficiently and flexibly, to work more closely with suppliers and partners, and to better satisfy the needs and expectations of their customers.

In practice, e-business is more than just e-commerce. While e-business refers to more strategic focus with an emphasis on the functions that occur using electronic capabilities, e- commerce is a subset of an overall e-business strategy. E-commerce seeks to add revenue streams using the World Wide Web or the Internet to build and enhance relationships with clients and partners and to improve efficiency using the Empty Vessel strategy. Often, e- commerce involves the application of knowledge management systems.

There is a new model for the information distribution process that supports hospitality/tourism organizations. The key feature of this business process is the design of cross- functional information systems that handle multiple business functions. The two processes are Supply Chain Management (SCM) and enterprise resource planning (ERP), which are used to facilitate front end and back end electronic commerce (E-Commerce) and internal employee application interfaces (EAI). Supply Chain Management is a system of information interfaces with sources of supply for material resources. Enterprise Resource Planning is the overall information system used to maximize resource utilization in the transformation process and to manage output generation. Hospitality E-Commerce is the use of electronic media for transactions and interactions among guests/clients, employees and other business enterprises. Employee Application Interfaces (EAI) are B2E information systems aimed at maximizing employee productivity.

E-business involves business processes spanning the entire value chain:

 electronic purchasing and supply chain management
 processing orders electronically
 handling customer service, and
 cooperating with business partners.

Special technical standards for e-business facilitate the exchange of data between companies. E-business software solutions allow the integration of intra and inter firm business processes. E-business can be conducted using the Web, the Internet, intranets, extranets, or some combination of these.

3 Categories of business applications:

1. Internal business systems:
 customer relationship management
 enterprise resource planning
 document management systems
 human resources management

2. Enterprise communication and collaboration:
 VoIP
 content management system
 e-mail
 voice mail
 Web conferencing

3. electronic commerce - business.-;to-business electronic commerce (B2B) or business- to-consumer electronic- commerce (B2C):
 internet shop
 supply chain management
 online marketing

Business models

When organizations go online, they have to decide which e-business models best suit their goals. A business model is defined as the organization of product, service and information flows, and the source of revenues and benefits for suppliers and customers. The concept of e-business model is the same but used in the online presence.

The following is a list of the currently most adopted e-business models:
 E-shops
 E-procurement
 E-malls
 E-auctions
 Virtual Communities
 Collaboration Platforms
 Third-party Marketplaces
 Value-chain Integrators
 Value-chain Service Providers
 Information Brokerage

Classification by provider consumer

Roughly dividing the world into providers/producers and consumers/clients one can classify e-businesses into the following categories:

 business-to-business (B2B)
 business-to-consumer (B2C)
 business-to-employee (B2E)
 business-to-government (B2G)
 government-to-business (G2B)
 government-to-government (G2G)
 government-to-citizen (G2C)
 consumer-to-consumer (C2C)
 consumer-to-business (C2B)

6.3 Enterprise Resource Planning Systems

Hospitality organizations that use IT capabilities will greatly enhance their competitive edge. Customized solutions, business collaboration, flexible organization structures all provide what the customer is looking for when doing business with a firm.

As a customer, you may not realize that other organizations are participating in the development of your product or service, as you may be dealing with a virtual company comprised of many firms acting in collaboration. An example of this in the industry is the proliferation of online intermediaries that provide cruises, airline flights, and hotel rooms by working as brokers in collaboration with a number of hospitality firms. In the near future, hospitality organizations will establish their own inter-sector collaborative initiatives, which will eliminate the role of the independent hospitality broker. An example of this trend in the present is the near elimination of travel agents as third party contractors of hospitality and tourism services.

Information systems are certainly efficient and effective when it comes to management information used to make decisions. Managers have access to automated information that used to take long hours of tedious manual operations to compile. This is one of the intended outputs that drove the developments in the areas of database development and networking. Table 6.2 lists four types of management reports that are generated from information systems.

Table 6.2 Management reports generated from information systems

Periodic Scheduled Reports
Standard reports generated on periodic bases. Examples include Night Audit reports on a daily basis, Month-to-Date budget reports on a weekly basis, and Variance reports on a monthly basis.

Exception Reports
Produced and distributed when something out of the ordinary occurs. Flash and Pop-Up reports are examples.

Demand Reports
Sorted and specialized reports available to managers through database report generators and SQL.

Push Reports
Exception information "pushed" through the network to the workstations of all managers with a need to know. Similar to exception reports, but distributed to a more specific group of managers.


The periodic reports (daily, weekly, quarterly, annually distributed) are automatically generated and distributed to lists of managers and executives based on need-to-know the information. Additional reports such as, schedules, hours worked, banquet event orders (BEOs), occupancy, and others, are distributed to the general employee populous, again, based on the need to know the specific information. Many individuals in organizations are accustomed to these reports being printed on paper and placed in intra-company mail boxes for distribution. More progressive companies, however use electronic distribution, which is more effective and efficient than printed reports.

Remember that reports are generated by queries that order the sorting and combining of various records in the database used to provide specific information and analysis. Marketing and project managers are particularly fond of power associated with online analytical processing (OLAP) procedures available in progressive hospitality organizations. Online Analytical Processing (OLAP) uses electronic media to provide data collection and analysis from remote locations in real time. Table 6.3 provides a listing of these activities.

Table 6.2 OLAP activities

Automated Environment Analysis (AEA)
Data warehouses linked through a Database Management System (DBMS) with data mining features.

Consolidation
Chain of regional offices to provide information by property, city, geographic region, district or nation.

Drill Down
The opposite of consolidation. The chain home office can identify top producers at specific properties in ranking order and compare them with regional, district or national performance benchmarks.

Slicing and Dicing
Breaking information into customized segments, sectors or niches.

6.4 Artificial Intelligence

Artificial intelligence (AI) comes from the blended disciplines of computer science, biology, psychology, linguistics, mathematics and engineering. The goal of AI is to create machines with human physical and mental abilities (reasoning, learning, and problem solving). AI is not a new technology application, however, it has not been widely used until recently, as cost and machine power limitations prevented the development of its application for practical uses. Some of the aspects of AI are listed below:

 Neural Networks - The closest electrical simulation of an organic system. Comprised of networked processors that interact as transponders and have the capacity for learning based on identification of patterns and relationships.

 Fuzzy Logic- Processors that can perform reasoning based on inferences and incomplete data (the opposite of "crisp data") in response to SQL inquiries.

 Virtual Reality - Computer simulated reality based on multi-sensory input and output devices to create undetected simulated environments through telepresence illusions.

 Intelligent Agents - Applets that perform tasks for end users using a built-in knowledge base about processes. Application Wizards are good examples.

 Expert Systems – knowledge-based system that possesses expertise in a single discipline. Users pose questions and problems and the ES provides solutions. The three components of all expert systems are listed below:

o Knowledge base is the information contained by the system in factual and heuristic form.

o Inference engine provides analysis tools for If/Then reasoning and adds experiences to the KB through repetition.

o A knowledge engineer and a logic programmer program the expert shell.

All of these applications have been available from in technology R&D laboratories since the early 1990s. While smart chips have been built into commonly used machines and appliances that use some of these technologies (automobiles, for instance), the more powerful applications have been precluded from reaching market places due to hardware constraints. Today, however, with more powerful microprocessors and lower hardware costs, researchers are considering broad applications of these technologies. The implications for the hospitality/tourism industry over the next ten years will only be limited by the imaginations of decision-makers. This is a wonderful time for hospitality practitioners, as these technologies permit hospitality managers to use creative talents to envision and develop applications in conjunction with technical experts.

CHAPTER SUMMARY

This chapter has discussed many of the advancements in technology and information telecommunications that provide the establishment of fully functional E-Commerce systems. These systems infiltrate the interior aspects of the organization and link those to outside sources via the Internet, intranets, and extranets. The key driver for these applications is the overall advancement of telecommunications technologies. As discussed in the chapter, technology is facilitating new forms of open systems within, between, and among the variables that exist in the external environment.

Chapter 7

E-BUSINESS STRATEGIES AND SOLUTIONS

Objective: This chapter deals with the existing business strategies in E-Commerce. At the end of this chapter, the students should be able to develop a simple e-business planning process, and a strategic solution.

In today's highly competitive business environment, budget-oriented planning or forecast-based planning methods are insufficient for a large corporation to survive and prosper. The firm must engage in strategic planning that clearly defines objectives and assesses both the internal and external situation to formulate strategy, implement the strategy, evaluate the progress, and make adjustments as necessary to stay on track. Below is a simplified strategic planning diagram.

Strategic Planning Steps
Mission and Objectives

The mission statement describes the company's business vision, including the unchanging values and purpose of the firm and forward-looking visionary goals that guide the pursuit of future opportunities.
Guided by the business vision, the firm's leaders can define measurable financial and strategic objectives. Financial objectives involve measures such as sales targets and earnings growth. Strategic objectives are related to the firm's business position, and may include measures such as market share and reputation.

Environmental scan

The environmental scan includes the following components:
 internal analysis of the firm
 Analysis of the firm's industry
 External macroenvironment

The internal analysis can identify the firm's strengths and weaknesses and the external analysis reveals opportunities and threats. A profile of the strengths, weaknesses, opportunities, and threats is generated by means of a SWOT analysis. (Strength, Weaknesses, Opportunities, and Threats)

An industry analysis can be performed using a framework developed by Michael Porter known as Porter's five forces. This framework evaluates entry barriers, suppliers, customers, substitute products, and industry rivalry.

Strategy Formulation
Given the information from the environmental scan, the firm should match its strengths to the opportunities that it has identified, while addressing its weaknesses and external threats.
To attain superior profitability, the firm seeks to develop a competitive advantage over its rivals. A competitive advantage can be based on cost or differentiation.

Strategy Implementation
The selected strategy is implemented by means of programs, budgets, and procedures. Implementation involves organization of the firm's resources and motivation of the staff to achieve objectives.

The way in which the strategy is implemented can have a significant impact on whether it will be successful. In a large company, those who implement the strategy likely will be different people from those who formulated it. For this reason, care must be taken to communicate the strategy and the reasoning behind it. Otherwise, the implementation might not succeed if the strategy is misunderstood or if lower-level managers resist its implementation because they do not understand why the particular strategy was selected.

Evaluation & Control
The implementation of the strategy must be monitored and adjustments made as needed. Evaluation and control consists of the following steps:
 Define parameters to be measured.
 Define target values for those parameters.
 Perform measurements.
 Compare measured results to the pre-defined standard.
 Make necessary changes.

E-BUSINESS SOLUTIONS
Tips and techniques to a better e-business solution:
I. an e-mail address.
II. promote your business.
III. a good name for your website, URL.
IV. a website.
V. get people to visit your website.
VI. Customer Relations Management (CRM)
VII. register with search engines
VIII. get statistics about visits to your website
IX. get an evaluation of the efficiency of your website.
X. improve your website.
XI. prepare for e-commerce taxes.

I. E-Mail
To conduct electronic business successfully the first thing you need is an e-mail address. Most Internet Service Providers (ISPs) will offer you one for free or for a modest fee. However, the e-mail address that you want my already be taken. You need an address that is unique worldwide. So it may take some searching and compromising to find one for you.
Occasionally, you may want to change your provider of e-mail services. For instance, you may not like the advertisements that go with a free address. If you are a member of the Institute of Electrical and Electronics Engineers (IEEE) you can get an e-mail alias. This means that you can keep that address when you change providers. It also means that your e- mail will be routed through the IEEE server, for example, which offers an extra firewall against viruses.

II. Promotion
As with all business and commerce you will have to promote your e-business and e- commerce. You can use all conventional means, ways and media. However, certain aspects are specific and you have to consider them.
Some users and authorities take a dim view of so-called scamming, i.e. flooding users with unsolicited commercial e-mail (UCE) messages. There are already laws prohibiting such activities and others are in the works.
The use of equipment that automatically calls a series of telephone numbers and leaves recorded messages is also considered annoying.
:::.

III. Universal Resource Locator, URL
The URL is the address of your website. It consists of . . Typical domains are ".com" for commerce, ".edu" for education, ".org" for organization, ".mil" for military, ".gov" for government, and ".net" for network. These are all U.S. domains. The United States also has the country code ".us" that is used occasionally. Every other country has a country name such as ".ca" for Canada and ".uk" for United Kingdom and .ph for Philippines. The country code for Moldova, ".MD" is popular among medical doctors! Note that there are no general rules about the allocation of domains. It is up to the registration agency to accept or decline a name. The world is running out of popular ".com" names and they can be traded at millions of dollars. As with e-mail addresses, your URL must be unique worldwide.

IV. Website
The next step is to create a website and put contents on its pages. When you surf the web you will see all kinds of WebPages, one fancier than the other. Do not fall for the temptation to make fancy WebPages. You are not out to win a webpage award. You want to sell your products and services. Make sure that advertisements for the products and services of others do not overwhelm the promotion of your own products and services.
Avoid using dark backgrounds - in particular black - for text, which will then be hard to read. Do not use a small font that is difficult to read. Backgrounds and pictures will also slow down the downloading of pages. Your potential costumers and clients may give up before they get to the promotion of your goods. Keep your WebPages simple!
Make sure that the contents of your website can be displayed and printed without scrolling left or right. You may have noticed that text to the right of a site does not print. You do not want this to happen to your site.

Websites are written in the HyperText Markup Language (HTML), in one of its versions, or in similar languages like the Extended Markup Language (XML). You want to write your website in a language that most browsers can read, like the basic HTML. A
browser is a computer program that reads the contents of websites. The Microsoft Internet Explorer and the Mozilla Firefox are examples.

There are HTML editors like the Microsoft FrontPage and Netscape's Composer that automatically write in HTML. Thus, you do not have to learn HTML, even though it is recommended. Knowing some HTML lets you edit your webpage content. There are simple books like the 10 Minute Guide to HTML.
You want your customers and clients to be able to register and to communicate with you to order your products and services, and to pay for them by credit cards, etc. - all from the website. For that you need one or several fill-in forms on your website. You can arrange to have the filled in information sent bye-mail to any e-mail address of your choice. You can read about how to create them in manuals and help-files. Also ask your ISP regarding fill-in forms.
If you select a free or low fee website and/or e-mail server, the ISP may restrict the sizes of your e-mail and the number of website hits. Make sure that you agree to the ISP's rules.
You can also have your own e-mail and website servers. To start you only need ~ something like a Microsoft NT or 2000 Server.

V. Increasing Hits and Traffic
It is essential that your potential customers and clients visit your website to be exposed to your promotional efforts. There are several ways to increase the traffic to your website.
1. Use a Title of your site that conveys what you offer. Search engines look for Titles and direct surfers to your site depending on the text in the Title.
2. Use META KEYWORDS in the head of your HTML text. For example: - This is another kind of text that search engines look for. However, do not overdo your META -files. Some search engines are programmed to reject WebPages that are considered being designed to manipulate search results.

3. Add a META Description Tag to describe your site for the search engines. Sample:

4. Register your website with search engines. You can do this individually with each engine, or you can use services that do it for you. With several thousand search engines in use worldwide, registering with all of them is a chore.

Yahoo! has an extensive website that tells you how to suggest a website to them. Go to http://howto.yahoo.com/chapters/lO/a.html and click on Suggesting a Site.

VI. Customer Relations Management (CRM)

You have the option to encourage people to correspond with you by e-mail. To get replies by e-mail, you need to post your e-mail address on your website, and/or have forms for replies, comments, ordering, etc. You should encourage people to give you their e-mail address.
People will also reply by telephone and fax. If you expect any reasonable number of phone calls you will need a Call Center. A more up-to-date name is Contact Center. Because customers and clients will contact you by voice, fax and e-mail, you will need a Contact Center that handles all kinds of contacts. Information about the caller, including history, e- mails, faxes, etc. should be displayed to your customer representative at the same time that he/she takes a call.



VII. Register with Search Engines
Listing with some ten of the top search engines should give you good enough service. Among the top engines are All the Web (Fast), AltaVista, AOL, Excite, Go.com, Google, HotBot, Lycos, Microsoft's MSN, Netscape, NorthernLight, WhatYouSeek and Yahoo!. Note that rankings differ with the ranking criteria used.
To reach them try websites that offer listings, such as Open Directory, WebCrawler, etc. You can also list directly with each search engine.

VIII. Hit Statistics

You need to know how successful your website is, i.e. the number of people that visit it and what they are looking at. Most Internet Service Providers (ISPs) offer hit counters. Ask your ISP how to install a counter. They are all different.
A hit counter typically displays the number of previous visitors. If you do not want your visitors to know that number, there are programs that send the information to you only. Other programs give you the number of hits for each page of your site.

Several programs that track hits are available. They will report the number of hits per page, the referring search engine, the domain name of the visitors, etc. Among such programs are HitBox and WebPosition.

IX. Evaluate the Efficiency of Your Web site

You should evaluate the efficiency of your website. This can be measured in the number of hits, as stated in Section VIII. above. The amount of purchases, the listings by search engines, etc. are also part of the efficiency. Continuously make sure that your site does not have any dead links, that browsers will find it, that download times are reasonable, etc. There are services that evaluate the efficiency of your website, some for free. Try ProBooster, ProBoostGold and WebPosition.

X. Improve your website
Use all the information you have collected to improve on your website.

XI. Prepare for E-Commerce Taxes
Governments are always looking for things that can be taxed. E-commerce is no exemption. However, there are also strong oppositions to taxing e-commerce. Some jurisdictions are levying taxes on e-commerce, others are not. Some are payable by sellers, others by users and third parties.

CHAPTER 8

Computer Reservation Systems and Global Distribution Systems

Objective: This chapter deals with the existing reservation systems used by the hospitality industry. At the end of this chapter, the students should be able to identify and enumerate the different techniques and strategies on an online reservation and information systems.

Definition:

A computer reservation system (CRS) is a computerized system used to store and retrieve information and conduct transactions related to travel. Originally designed and operated by airlines, they were later extended to travel agents as a sales channel; major CRS operations that book and sell tickets for multiple airlines are known as Global Distribution System (GDS). Airlines have divested most of their direct holdings to dedicated Global Distribution System companies, and many systems are now accessible to consumers through Internet gateways for hotel, rental cars, and other services as well as airline tickets

GDS / CRS Evolution

The travel marketplace is a global arena where millions of buyers ( travel agents and public) and sellers (hotels, airlines, car rental companies, etc.) work together to exchange travel services. Among the “shelves” on which buyers search for travel services are world global distribution systems and the Internet distribution systems. These systems have become electronic supermarkets linking buyers to sellers and allowing reservations to be made quickly and easily. Nowadays, more travel is sold over the internet than any other consumer product. The Internet is a perfect medium for selling travel as it brings a vast network of suppliers and a widely dispersed customer pool together into a centralized market place. Nearly 37 million f America’s more than 162-million active internet users have already purchased travel online. Online travel bookings exceeded $23 billion in 2001, and are expected to reach $63 billion by 2005.

However, any discussion of the Internet as a distribution channel for travel needs to start with an understanding of the existing electronic distribution infrastructure, the Global Distribution System (GDS). The airline industry created the first GDS in the 1960s as a way to keep track of flight schedules, availability, and prices. Although accused of being “dinosaurs” due to their use of legacy system technology, GDS were actually among the first e-commerce companies in the world facilitating B2B electronic commerce as early as mid 1970s, when SABRE (owned by American Airline) and Apollo (United) began installing their propriety internal reservations systems travel agencies. Prior to this, travel agents spent inordinate amount of time manually entering reservations. The airlines realized that by automating the reservation process for travel agents, they could make the travel agents more productive and essentially turn into an extension of the airline’s sales force. It is this original legacy that GDS today provide the backbone of the internet travel distribution system.

There are currently four major GDS systems:

1. Amadeus
2. Galileo
3. Sabre
4. Worldspan

In addition, there are several smaller or regional GDSs, including SITA's Sahara, Infini (Japan), Axess (Japan), Tapas (Korea), Fantasia (South Pacific), and Abacus (Asia/Pacific) that serve interests or specific regions or countries.

I. Amadeus

Founded in 1987 by Air France, Iberia, Lufthansa, and SAS, Amadeus is the youngest of the four GDS companies. Amadeus is a leading global distribution system and technology provider serving the marketing, sales, and distribution needs of the world's travel and tourism industries. Its comprehensive data network and database, among the largest of their kind in Europe, serve more than 57,000 travel agency locations and more than 10,500 airline sales offices in some 200 markets worldwide. The system can also provide access to approximately 58,000 hotels and 50 car rental companies serving some 24,000 locations, as well as other provider groups, including ferry, rail, cruise, insurance, and tour operators.

2. Galileo International

Galileo International was founded in 1993 by 11 major North American and European airlines: Aer Lingus, Air Canada, Alitalia, Austrian Airlines, British Airways, KLM Royal Dutch Airlines, Olympic Airlines, Swissair, TAP Air Portugal, United Airlines, and US Airways. It is a major player in the GDS business throughout the world: North America, IEurope, the Middle East, Africa, and the Asia/Pacific region. Galileo International is a diversified, global technology leader. Its core business is providing electronic global distribution services for the travel industry through its computerized reservation systems, leading-edge products and innovative Internet-based solutions. Galileo is a value-added distributor of travel inventory dedicated to supporting its travel agency and corporate customers and, through them, expanding traveler choice.

3. Sabre

For more than 40 years, Sabre has been developing innovations and transforming the business of travel. From the original Sabre computer reservations system in the 1960s, to advanced airline yield management systems in the 1980s, to leading travel web sites today, Sabre technology has traveled through time, around the world, and has touched all points of the travel industry. In July of 1996, Sabre became a separate legal entity of AMR (parent company of American Airlines), followed by a successful initial public offering in October in which AMR released approximately 18% of its shares to be publicly traded. Sabre, represented in 45 countries, is a leading provider of technology for the travel industry and provides innovative products that enable travel commerce and services, and enhance airline/supplier operations.

4. Worldspan

Founded February 7, 1990, Worldspan was originally owned by affiliates of Delta Air Lines, Inc., Northwest Airlines, and Trans World Airlines, Inc. It is currently owned by affiliates of Delta Air Lines, Inc. (40%), Northwest Airlines (34%), and American Airlines, Inc. (26%). Since its 1995 advance into the world of Internet technology for the travel industry, Worldspan has successfully developed the strategies, solutions, and services to ensure the company's long-term success in the new web-based world of travel distribution. Worldspan provides worldwide electronic distribution of travel information, Internet products and connectivity, and e-commerce capabilities for travel agencies, travel service providers, and corporations. Worldspan currently serves 20,021 travel agencies in nearly 90 countries and territories. Headquartered in Atlanta, Georgia, Worldspan connects approximately 421 airlines, 210 hotel companies, 40 car rental companies, 39 tour and vacation operators, and 44 special travel service suppliers.

Advantage of hotel intermediaries:

Meeting planners and travel agents could become an even more important distribution channel than they already are for hotels, provided that lodging operators understand the - factors that create value for those important intermediaries. As part of Cornell's broad-based survey of best practices in the U.S. lodging industry, researchers conducted a survey to discover the hotel attributes and practices that create value for travel agents and meeting - planners. The study found that the most important factor in the lodging transaction with intermediaries is a hotel's ability to make the hotel booking process as smooth as possible, including a problem-free stay for the clients. While location is, of course, the key factor in the intermediaries' choice of a hotel for their clients, travel agents indicated that the quality of communications, the hotel's brand name or reputation, and the quality of deals or incentives were also important in creating value in the booking transaction. While a good price is important, meeting planners additionally consider meeting and convention services and food- service quality as essential to creating value in a hotel transaction.

Speech Technology to Distribution System

IT in tourism helps to reduce information gaps among suppliers by providing information on market products, and among consumers by reducing the complexity of decision making. Mobile tourist information applications for in-trip information services are developed in different ways. Speech technology offers a similar in-trip information system in the form of a telephony speech dialog systems (SDS), which provides diverse information via a telephone voice interface in a dialog of question and answer. The idea of a destination speech dialog system so far solely exists in theory. The system can be reached by tourists via a (mobile) telephone in the destination where they receive information on sights, accommodation, opening hours, entrance fees, the weather, etc.

HRTM135 LABORATORY CLASS WED 1-4

for all students under Ms. Unajan for the HRTM 135 laboratory, Wednesday, 1-4...

we will have our class in the internet cafe of DCST on July 21, 2010, 1-4 in the afternoon.

Everybody is to finish all their exercises (1-4) and have it checked.

Project for finals will also be announced.

Everybody under that class.. no more batch 1 and batch2..

c. u.

ANNOUNCEMENT for HRTM 135

July 7, 2010 (Wednesday) lectures on 8:00 - 9:00 and 4:00 - 5:00 and July 8, 2010 (Thursday) 8:00 - 9:00.. we will not meet on during lecture time..

Here is what you should do:

1. meet with your group mates.

2. decide on what specific hospitality industry will u be promoting
hotels
restaurant
food chains
resort
leisure cruise
airlines
tourist spots (local, national, global) - most preferable if local spots in your own provinces... promote your local tourism
and many others

3. once decided, its time for you to create your blogs.

4. you can use blogspot.com, wordpress.com, yahoo blogs, facebook blogs, friendster blogs and other blogging sites.

5. make sure to describe in your blogs that it is a blog for your HRTM135 subject then give me the complete URL of your blogs in our next meeting during our lecture. it will be viewed in our lecture time from time to time for improvement and progress...

keep posted...and post comments for questions and clarifications

QUIZ ANNOUNCEMENT

Chapter 1 Quiz on July 5, 2010 for MW class and Quiz on July 6, 2010 for TTh class.. Be conscious of your time. 30-minute quiz only.

CHAPTER 2 : SOFTWARE, PROCEDURE

2.1.2 SOFTWARE
Software is the step-by-step instructions that tell the hardware how to perform a task. Without software, the hardware is useless. Software is of two types: Systems software and Applications software.

Applications software is the software that can perform useful work on general-purpose tasks while the systems software enables the applications software to interact with the computer and help the computer manage the internal resources.

2.1.3 DATA / INFORMATION

2.1.4 PROCEDURE
Procedures are the steps for accomplishing a result. Some procedures maybe expressed in manuals or documentation.

2.15 PEOPLE
People are the most important part of, and the beneficiaries of, a computer-and-communications system. The whole point of data processing is to benefit people. People of all level and skills, from novices to programmers, are the users and operators of the system. Regardless of the size of the data processing system, data processing personnel will probably be needed to make the system efficient and effective.

For a small organization, there maybe only one or two people in the data processing department. A large system may require literally hundreds or even thousands of personnel. A small business owner who decides to operate a microcomputer will be performing the functions of a complete data processing department.

People and procedures are probably the easiest elements to understand in a computer-and-communications system – although, arguably the most complicated.

CHAPTER 2 : COMMUNICATIONS HARDWARE

2.1.1.5 COMMUNICATIONS HARDWARE

“Computers and communications: these are the parents of the Information Age. When they meet, the fireworks begin”.

This was written by one writer who referred to fireworks as how portable information and communications technologies are changing the conventional meanings of time and space.

The physical locations we traditionally associate with work, leisure and similar pursuits are rapidly becoming meaningless. The term cyberspace, which was coined by William Gibson in his novel Neuromancer, referring to a futuristic computer network that people use by plugging their brains into it, has become very popular. It has now come to mean the whole wired and wireless world of communications.

Connectivity is the ability to connect devices by telecommunications lines to other devices and other sources of information. With connectivity, or connected communications devices, users can use the technology for a number of purposes, ranging from low-skill to high-skill activities. They can use telephone-related services, such as fax, voice-mail, and e-mail. They can do teleconferencing, share resources through workgroup computing and Electronic Data Interchange.

They can make their work portable with telecommuting, mobile workplaces, and virtual offices. They can use online information services for research, e-mail, games, travel services, and teleshopping. They can use electronic bulletin board systems (BBSs), large and small. They can connect with the global Internet and information gathering, e-mail and discussion and news groups. In the future, they can engage in interactive TV or video through set-top boxes, picture phones and TV/PCs.

Computers communicate in two main ways: through modems and through networks.

Modems allow computers to use the telephone lines or cellular connections to trade data.

Networks connect computers directly, either through special wires or by some form of wireless transmission. The communications hardware commonly used in business are as follows: modems, fax modems, and multiplexers, concentrators and front-end processors.

A modem (from modulator/demodulator) is a device that converts digital signals to analog format to allow data to be transmitted through a telephone line and from analog back to digital format to be accessed back by the computer on the other end.

Modems are probably the most widely used data communications hardware. They allow the user to directly connect the computer to the telephone line. They are either internal or external. An internal modem is located on a circuit board that is placed inside a microcomputer (plugged into an expansion slot). It draws its power directly from the computer’s power supply. An external modem is an independent hardware component – that is, it is outside the computer and uses its own power supply.

A fax modem, which is a circuit board inside the computer’s system cabinet, is a modem with fax capability. It enables one to send data and scanned-in images directly from one’s computer to someone else’s fax machine or fax modem.

When an organization’s data communications needs grow, the line available for that purpose often become overloaded, even if the company has leased one or more private telephone lines – called dedicated lines – used only for data communications.

Multiplexing optimizes the use of communications lines by allowing multiple users or devices to share one high-speed line, thereby reducing communications costs. Multiplexing can be done by multiplexers, concentrators, front-end processors.

A multiplexer is a device that merges several low-speed transmissions into one high-speed transmission. Messages sent by a multiplexer must be received by a multiplexer of the same type. The receiving multiplexer sorts out the individual messages and directs them to the proper recipient.

A concentrator is a piece of hardware that also enables several devices to share a single communications line. However, it collects data in a temporary storage area and then forwards them when enough has been accumulated to be sent economically. Often, a concentrator is a minicomputer.

A front-end processor is a smaller computer that is connected to a larger computer and assists with communications functions. It may itself be a minicomputer or a mainframe. It transmits and receives messages over the communications channels, corrects errors, and relieves the larger computer of routine computational tasks.

CHAPTER 2 : STORAGE HARDWARE

2.1.1.4 STORAGE HARDWARE

Secondary storage is external storage, that is, it is outside the system board. It is also referred to as permanent storage or auxiliary storage. The function of the storage hardware is to provide a means of storing software and data in a form that is relatively permanent, or nonvolatile, that is, the data is not lost when the power is turned off – and easy to retrieve when needed for processing.

Secondary storage devices come in the following forms: diskettes, hard disks, optical disks, magnetic tape, and flash memory cards.

A diskette, or floppy disk is a removable round, flat piece of mylar plastic flexible disk that stores data as magnetized spots. More specifically, data is stored as electromagnetic charges on a metal oxide film that coats the mylar plastic.

Data is represented by the presence or absence of these electromagnetic charges, following standard patterns of data representation (such as ASCII – American Standard Code for Information Interchange).

Two types of floppy disks are commonly used for microcomputers. The older and larger size is called minifloppy disk, 5 ¼ inches in diameter, comes in soft plastic envelopes about 5 1/2 inches square, and comes in capacities of 360 kilobytes (K) and 1.20 megabytes (M). The smaller and now the most popular size, is microfloppy disk. It is 3 ½ inches in diameter, comes in a hard plastic shell that measures about 3 1/2 inches by 3 3/4 inches and comes in capacities of 720 kilobytes (K) and 1.44 megabytes (M).

To use a diskette, the computer must have a floppy disk drive which is a device that holds, spins, and reads data from and writes data to a diskette.

Hard disks are thin but rigid metal platters that hold data as magnetized spots. They are sealed inside a hard disk drive which is usually built into the system unit in a microcomputer. Inside the hard disk drive is the disk is on the drive spindle, with read/write heads mounted on the actuator (access) arm that moves back and forth and power connections and circuitry.

Data may be recorded on both sides of the disk platters. External hard disk drives are also available, as are removable hard disk cartridges. An external hard-disk drive has its own power supply and is not built into the system cabinet. It is usually easy to add an external hard disk which can normally store gigabytes of data.

A hard disk cartridge consists of one or two platters enclosed along with read/write heads in a hard plastic case. The case is inserted into a detached cartridge system connected to a computer.

An optical disk is a removable disk on which data is written and read through the use of laser beams. The optical disk used with computers consists of four types: CD-ROM, CD-R, WORM disks, erasable optical disks.

CD-ROM, which stands for compact disk-read-only memory, is the best known type of optical disk. It is an optical disk format that is used to hold prerecorded text, graphics and sound. Read-only means the data stored on the disk can only be read but not modified or erased by the user.

CD-R, which stands for compact disk-recordable, is a CD format that allows user to write data onto a specially manufactured disk that can be read by a standard CD-ROM drive. WORM stands for write-once-read-many.

A WORM disk can be written, or recorded, onto just once and then cannot be erased, it can be read many times. WORM technology is useful for storing data that needs to remain unchanged, such as that used for archival purposes. An erasable optical disk allows user to erase data so that the disk can be used over and over again. The most common type is the magneto-optical disk which uses aspects of both magnetic disk and optical disk technologies.

Magnetic tape is made of flexible plastic coated on one side with a magnetic material on which data are represented with magnetized spots.

Magnetic tape used for computers is made from the same material used for audiotape and videotape. Because a tape is a long strip of magnetic material, the tape drive has to write data to it sequentially – one byte after another.

Sequential access is inherently slower than direct access used for disks. When a user wants to access a specific set of data on a tape, the drive has to skip over all data not needed to get to the data wanted resulting in a long access time.

The magnetic tape access time varies depending on the speed of the drive, the length of the tape, and the position on the tape to which the head wrote the data in the first place. On large computer, tapes are used on magnetic-tape units. On microcomputers, tapes are used in cartridge tape units and are nowadays used mainly to provide duplicate storage called backup.

Flash-memory or flash RAM cards consist of circuitry on credit-card-size cards that can be inserted into slots connecting to a motherboard of a microcomputer. They can hold up to 100 megabytes of data. Flash-memory cards, however, are not infallible. They circuits wear out after repeated use, limiting their life span.

CHAPTER 2 : PROCESSOR and MEMORY

2.1.1.3 PROCESSOR AND MEMORY

The complex procedure that transforms raw input data into useful information for output is called processing. To perform this transformation, the computer uses the processing and main memory devices, which are housed in the computer’s system unit or system cabinet. The system unit, or system cabinet, houses among other things, the electronic circuitry, called the CPU that does the actual processing and the main memory that supports processing.

The Central Processing Unit, or CPU, is the processor and is considered as the brain or heart of the computer. It reads and interprets software and coordinates the processing activities that must take place. In a microcomputer, the CPU is usually contained on a single integrated circuit or chip.

This single chip is called a microprocessor. This chip and other components necessary to make it work are mounted on a main circuit board called a system board. In larger computers, the CPU is contained on one or several circuit boards. The design of the CPU affects the processing power and the speed of the computer, as well as the amount of main memory it can use effectively.

The CPU uses the computer’s memory to hold pieces of data or information while it works with them, together with the instructions for processing these data. It operates like a chalkboard that is constantly being written on, then erased, and then written on again.

The main memory, which is also called random access memory (RAM), internal memory, or primary storage, is contained on chips mounted on the system board. The major attribute with main memory is storage capacity or size because it determines how much data can be processed at a time and how big and complex a program may be used to process it.

RAM is volatile, that is, all contents are lost when the computer’s power is shut off. To produce a copy of the data and instructions that are stored in the memory, they should be saved, before the computer is turned off, to a secondary storage device for future use.

CHAPTER 2 : OUTPUT HARDWARE

2.1.2 OUTPUT HARDWARE

Output Hardware consists of devices that translate information processed by a computer into a form that humans can understand. The two principal kinds of output are hardcopy and softcopy.

Hardcopy refers to printed output while softcopy refers to output that is not tangible. These include data that is shown on a display screen or in audio or voice form.

Devices that output hardcopy include printers, plotters and multifunction devices.

A printer is an output device that converts computer output into printed images. Printers are categorized according to whether or not the image produced is formed by physical contact of the print mechanisms with the paper.

Impact printers form characters or images by striking a mechanism such as a print hammer or wheel against an inked ribbon, leaving an image on paper. For microcomputer users, the most common impact printers are daisywheel and dot-matrix.

Non-impact printers, on the other hand, form characters and images without making direct physical contact between printing mechanism and paper. They are faster and quieter than impact printers because they have fewer moving parts.

Two types of non-impact printers often used with microcomputers are laser printers and ink-jet printers.

A third kind, the thermal printer, offers the highest-quality color printing available with a desktop printer. However, it is seen less frequently because it is expensive, and requires expensive paper. It uses colored waxes and heat to produce images by burning dots onto special paper.

Plotters are specialized output device designed to produce high-quality graphics in a variety of colors. They are especially useful for creating maps and architectural drawings, although they may also produce less complicated charts and graphs.

The three principal kinds of plotters are pen, electrostatic, and thermal.

Multifunction devices combine several capabilities, such as printing, scanning, copying, and faxing, all in one device.

Softcopy output generally refers to the display on a monitor, the output device that many people use the most.

Display screens or monitors are output devices that show programming instructions and data as they are being input and information after it is processed. On display screens, images are represented by individual dots or picture elements called pixels which are the smallest units on the screen that can be turned on and off or made different shades.

The two main types of monitors are cathode-ray tube and flat-panel displays.

A cathode-ray tube uses a vacuum tube like that in a television set while flat-panel displays are much thinner, weigh less, and consume less power.

Flat panel displays are made up of two plates of glass with a substance in between them, which is activated in different ways.

The three types of technology used for flat-panel display screens are: liquid-crystal display (LCD), electroluminescent (EL) display, and gas-plasma display.

Whether CRT or flat-panel, screen clarity depends on three qualities: resolution, dot pitch and refresh rate. To display graphics, a display screen must have a video display adapter, also called a graphics adapter card, which is a circuit board that determines the resolution, number of colors, and how fast images appear on the display screen.

Video display adapters embody certain standards. The Monochrome Display Adapter (MDA) and Color Graphics Adapter (CGA) are no longer favored. Newer computer displays tend to favor the Video Graphics Array (VGA), Super Video Graphics Array (SVGA) and Extended Graphics Array (XGA).

Other softcopy hardware includes audio-output devices, video-output devices, virtual reality devices and robots.

Audio-output devices include those devices that output voice or voice-like sounds and those that output music and other sounds. These include the voice-output devices which convert digital data into speech-like sounds.

The two types of voice-output technology that exist are speech coding and speech synthesis. Speech coding uses actual human voices speaking words to provide a digital database of words that can be output as voice sounds. Speech synthesis uses a set of 40 basic speech sounds (called phonemes, the bases of all speech in English) to electronically create any words.

Sound-output devices produce digitized sounds, ranging from beeps and chirps to music which are all nonverbal sounds. To be able to output sound, the computer must have the necessary software and the sound card, a digital audio circuit board plugged into an expansion slot in the computer.

For musical sounds, the two types of sound-output technology are FM synthesis and virtual acoustics.

In FM synthesis, a synthesizer mimics different musical instruments by drawing on a library of stored sounds. Sounds are generated by combining wave forms of different shapes and frequencies.

In virtual acoustics, instead of storing a library of canned sounds, the device stores a software model of an actual instrument.

Video-output includes videoconferencing, high-definition television and three-dimensional television.

Videoconferencing is a method whereby people in different geographical locations can have a meeting-and see and hear one another-using computers and communications.

High-definition television (HDTV) is a television system that features enhanced video and crisp, clear pictures. These pictures are far superior to any seen on television today.

The other kind of HDTV manufactured is the experimental 3D HDTV. It uses special glasses with polarized lenses, while others used what appeared to be normal screens but these screens employed hundreds of tiny prisms/lenses giving a stunning 3D effect.

Virtual reality is a kind of computer-generated artificial reality that projects a person into a sensation of three dimensional space. It has the ability to recreate physical places and phenomena real to people. It is one of the most exciting applications of computer technology to date.

Virtual reality uses the body’s senses of sight, sound, motion, and touch to simulate real objects or places. To achieve this effect, the following interactive sensory equipment is necessary: headgear, glove, and software.

Robots are automatic devices that perform functions ordinarily ascribed to human beings or that operate with what appears to be almost human intelligence. Robots are of several kinds – industrial robots, perception systems, and mobile robots.

All of these are the objects of study of robotics, a field that attempts to develop machines that can perform work normally done by people.

Robotics in turn is a subset of artificial intelligence, a family of technologies that attempts to develop computer systems that can mimic or simulate human through processes and actions.