Information technology and cloud computing

HONG KONG AND SHANGHAI HOTELS SOARS

IN THE CLOUD

Incorporated in 1866, Hongkong and Shanghai Hotels (HSH) owns and manages a collection of reputable hotels across the world. Among its collection of hotels include the elegant Peninsula Hotels located in gateway cities around the world. Accelerated business growth across several years has resulted in rising pressure on the IT infrastructure of HSH as it seeks to explore other markets around the world. Although located in different countries, the hotels operate under the same brand with the objective of delivering high quality services. Also, every HSH hotel has dedicated servers with applications and thereby making it challenging for HSH to ensure uniform operations, data and applications in all its locations.

HSH business strategy is to deliver five star hospitality services to discerning tourists across the world. However, all efforts to create an IT infrastructure that could guarantee the required compliance, scalability and security was to no avail thereby hindering its expansion strategy. Therefore HSH corporate objectives and its strong desire to satisfy its customers at all times can only be supported by a centralised IT infrastructure.

In order to reduce the IT variations between its different locations and to easily create more features using the same platform of technology, the company embarked on a major IT upgrade project that was aimed at centralising its applications around cloud-based services. This was centred on the Microsoft 365 cloud productivity suite, SharePoint collaboration and Exchange messaging technologies. However, the upgrade initiative resulted in some challenges for HSH especially in terms of ensuring uniformity in technology security, meeting compliance requirements and precise management. Also, as a multinational corporation with a global network of business, HSH operates in different time zones across the world. The company therefore recognises the need to subscribe to a cloud service and management provider that can quickly detect and respond to technical problems in any part of the world and at any time.

After a series of meetings with several technical partners, HSH soon realised that Verizon was better equipped to deliver the required remote management and high availability. A three- year period road map was designed for Verizon to deliver a hybrid cloud capabilities that would help HSH to achieve its IT/IS strategy. An important component of this initiative would be to convert HSH’s disjointed IT infrastructure into a centralised environment using a mixture of both hosted and cloud-based services world and at any time.

With this project soon to be completed, HSH has completely transformed its IT infrastructure. The company has also achieved the agility to support existing and proposed facilities. HSH now boast of a healthy, efficiently managed and customer friendly technology

CASE STUDY 1

that can support its global and growing network of hotels. Also, the company is now well positioned to continue its culture of customer service innovation while outsourcing the task of its IT/IS infrastructure management to IT/IS professionals, thereby maintaining its status as a world leader in luxury accommodation.

Discussion. Whether operating locally or globally, every business organization will eventually realize that it has out-grown its legacy systems that allowed it to operate from its start-up stage. At this point, the company will normally require an IT strategy to support its business strategy. HSH started realizing the need for a system upgrade when its legacy IT infrastructure could no longer support its business strategy. HSH business strategy is to become a world leader in providing world class luxury accommodation, as well as expanding its business operations into more gateway cities across the world.

To achieve this business strategy, HSH will need to design an IS/IT strategy that will not cannibalise, but complement its business strategy. Therefore in line with HSH’s business strategy of maintaining a culture of customer service innovation as well as rapid expansion, the company designed its IT strategy to be customer friendly while also ensuring that technical issues can be easily identified and resolved given that its operations cuts across different time zones. This was a key factor for its choice of Verizon as its strategic technology partner as Verizon was best equipped to provide the required distant management as well as maximum surveillance.

Therefore HSH’s IS/IT strategy was clearly in alignment with its business strategy and this was evident in the flexibility and the efficiency that was achieved by reason of its technology partnership with Verizon. The company became better positioned to embrace new initiatives. HSH’s decision to settle for a hybrid cloud was also a strategic move as this allows its most sensitive data to be hosted on its premises while less sensitive data are cloud based. A revitalised IT infrastructure that is managed by IT experts has also allowed HSH to focus on its core competence of providing world class luxury accommodation.

HSH defined its business strategy and went in search of the technology that can support this strategy. It’s IS/IT strategy has allowed it to successfully implement its business strategy and thereby achieving its business goals. The HSH case study illustrate the fact that successful business organisations define their business strategy, and this strategy in turn determines there IS/IT strategy. HSH decisions regarding its applications and other IS/IT components were all determined by its business goals and strategies. The company has carefully designed its IS/ IT strategy to complements its business strategy. These two strategies must always be properly aligned if HSH must continue to achieve and sustain its competitive advantage.

The case study goes a long way to demonstrate that managers and IT professionals in any organisation must agree on the best IT solutions that can support their overall business strategies. Only then can the organisation easily achieve its business objectives. A wrong IS/ IT strategy can prevent an organisation from achieving its business strategy thereby leading to expensive IS/IT investments that cannot yield adequate return on investment. Therefore business managers and IT professionals in an organisation cannot afford to be at loggerheads. They must view IS/IT as an instrument for transforming their organisation and work as a team to design the best IS/IT strategy that can complement their business strategy.

CASE STUDY 2

Therefore the relationship between IS/IT strategy and the overall business strategy cannot be over emphasized. Both are interwoven and cannot be separated from each other as illustrated in the HSH case study. IS/IT strategy must be seen as a component of the business strategy and organisational strategy as a whole. The ability of an organisation to achieve its corporate goals to a large extent will depend on its IS/IT strategy. As demonstrated in the case study, HSH’s IS/IT strategy was intrinsically involved in achieving the company’s corporate goals of customer service innovation and business expansion across more gateway cities around the world.

There is no gainsaying that the perception about IS/IT among business managers in the past few decades has changed significantly as managers no longer view IS/IT as an independent tool outside their business strategy. Rather, managers now view IS/IT as a corporate recourse that must be well synchronised with their overall business strategy. This is because as illustrated in the case study, IS/IT has offered HSH new opportunities that can empower it to achieve and sustain a competitive advantage, become efficient in service delivery and the flexibility to easily develop new businesses and tap into new markets.

Source: “A critical evaluation of the impact of cloud computing: A view from the travel and tourism industry” . I. Gomins ,University of Bedfordshire. 2014. Thesis.

CASE STUDY 3