Holiday Inn 2014 Annual Report Download - page 24

Scale and eciency
of operations Why we think it is important
As identified on page 11, technology, as used
by travellers, is playing an increasingly
important role in shaping the travel industry.
The internet, which is now more than ever
accessed through mobile devices, is used
extensively to research, plan and book
travel. In emerging markets, consumers are
going straight to mobile devices, and there
are now twice as many mobile internet
users in China than internet users in the US.
Guests are also seeking greater levels of
personalisation, and are sharing their
experiences instantly via social media.
We believe that keeping abreast of the
evolving traveller trends and investing in
technology systems will assist us in building
brand preference, strengthen our loyalty
programme and deliver compelling and
engaging digital content across the ‘Guest
Journey’ (which comprises five steps –
Dream, Plan, Book, Stay and Share), thereby
enabling us to build lifetime relationships
with our guests.
What we are doing
To deliver the highest quality digital content
for our guests, we are ensuring that we have
the right technology foundations and
infrastructure in place. In 2014, we:
• standardised on property hardware
for all IHG hotels in the US, providing
a consistent platform that allows us
to develop solutions such as Mobile
Check-in and Check-out (now available
in over 500 hotels);
• piloted enhanced customer relationship
management capability that allows us to
utilise our IHG Rewards Club members’
profiles to drive personalisation and
guest recognition in our hotels;
• implemented new digital marketing
capabilities that allow us to target
potential guests more effectively
through the internet; and
• announced our strategic partnership
with Amadeus, the leading provider of
advanced technology solutions for the
global travel industry, to explore
technology solutions.
Improving our technology infrastructure
gives us the foundation to transform
the guest experience and make it more
interactive through digital content. In 2014,
we:
• increased mobile bookings by 50 per cent
to $900 million and downloads of the IHG
app grew by 80 per cent;
• made numerous improvements to our
award-winning mobile app, including the
launch of IHG translator, a learning tool
which engages our guests and drives
greater interaction; and
• created benefits for our IHG Rewards
Club members, including multi-brand
campaigns that include over one million
automatically tailored offers generated
using specific insights from each guest’s
profile and stay history – $360 million in
revenue was generated by the 2014 ‘Big
Win’ IHG Rewards Club promotion.
We recognise that successful delivery of our strategy for high-quality
growth requires Disciplined Execution. We prioritise investment in our
technology platforms and our people as well as delivering operational
efficiencies.
How we measure it
KPI – Fee margins
See page 32 for the KPI and
What we have done in 2014
How we measure it
KPI – System contribution to delivery
See page 30 for the KPI and
What we have done in 2014
Investment in developing strong technology platforms
Why we think it is important
Driving efficient operational processes
and managing our costs allows us to
contribute to hotel performance through
efficient practices, tools and systems.
It also helps us strengthen our revenue
delivery systems which means an increase
in system contribution to hotel revenue,
supporting our owner proposition and
maximising our investment in building
preferred brands. Careful cost management,
leveraging our scale and focusing on
productivity improvements also allows
us to drive continued improvement in
our margin.
What we are doing
To maximise the scale and efficiency of our
operations, we:
• focus on spending in a way which
enables further investment in our
strategic priorities. Our procurement
team has tools and processes which
allow us to monitor and control spend
and use our scale to deliver buying
advantage. Our focus on cost efficiency
and continuous improvement ensures
we deploy our resources effectively,
concentrating on the key priorities
and activities that drive our business;
• introduced a new human resources
system to streamline and improve the
automation of our human resources
processes in 2014 – see page 32; and
• continue to benefit from off-shoring
our Business Service Centre in Gurgaon,
India. This provides centralised
accounting services for IHG corporate
offices, and owned and managed hotels.
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IHG Annual Report and Form 20-F 2014
Disciplined Execution