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Consumer & Retail AI

Technology in the hospitality industry: The power of AI/EQ integration

08/09/2022

by Mattie Voss

AI (artificial intelligence) vs. EQ (emotional intelligence)

In the age of rapid technological innovation where machines exceed new milestones each day, there are concerns that automation leads to job loss – particularly when it comes to technology in the hospitality industry. However, these concerns imply that AI and humans have the same capabilities; they don’t.

AI, often associated with concepts such as automation and big data, refers to machines performing tasks that were traditionally considered to require cognitive function to perform. AI powered machines operate best in controlled environments and are proficient at handling repetitive, process-driven tasks.

Alternatively, tasks that require creative thinking, empathy, and dexterity call for EQ, or Emotional Intelligence. Emotional Intelligence is becoming an invaluable skill in the hospitality industry because interactions are not just about the delivery of standardized services; they require connectedness and emotional responses to a variety of complex situations.

In the context of service transactions, AI is associated with the tech aspects (e.g., data collection and analysis, order processing) while EQ is associated with the human, or “touch,” aspects (e.g., welcoming smile, reassuring voice, empathetic staff member).

Applying AI technology in the hospitality industry

Businesses across the hospitality industry are leveraging AI to increase efficiency, cut costs, and personalize the customer journey. Here are a few examples:

• Hoteliers and travel agencies are using virtual assistants and NLP (Natural Language Processing) chatbots to manage guest queries, enabling the business to provide the same level of customer service 24/7/365.
• AI-powered self-service kiosks are taking traditional restaurant experiences to new heights by streamlining the ordering process, and in turn reducing the wait time for patrons.
• AI and machine learning are facilitating the automation of many touchpoints for hotel guests, including check-in, checkout, and support during their stay.
• Conversational AI platforms can intelligently interact with guests and, if necessary, even route complex queries to a human agent.
• Digital check-in systems that are integrated with AI technology are providing customers the convenience of checking in to their rooms via their mobile device without having to stop at the front desk.
• AI technology can assess large amounts of data quickly drawing valuable insights about consumer behavior that can inform key business strategy decisions, such as offering a new product or service. For instance, an organization could leverage AI to discover patterns among data – like shifts in customer preferences – that uncover opportunities to tap into profitable market segments.

Regardless of the application, one thing remains constant – AI output depends on human input.

Rethinking the dynamic between AI & EQ

A recent study found that businesses achieve the most significant performance improvements when humans and machines work together. To capitalize on AI solutions, hospitality organizations must reconsider the relationship between machines and people in order to embrace the opportunity that exists in the middle ground.

For example, when a guest checks in to the Ritz-Carlton and finds her preferred magazines, beverages, and floor level without having to ask, it strengthens her loyalty to that hotel. Similarly, when a customer reserves a vacation package at Disney and is greeted genuinely, personally, and by name, it establishes an emotional connection through surprise and delight that leads to repeat bookings.

Both cases leverage AI technology to enable employees to offer a more personalized service. However, it is only through human interaction that employees can create a genuine, warm, and truly hospitable experience.

Insights for hospitality organization leaders

When incorporating AI technology into your digital roadmap, it is important to consider the following:

• What do your customers expect and prefer in a given situation? While Gen Z and Millennials are more comfortable interacting with chatbots (60% agree that automation/bots are helpful for simple issues), in general, customers still rely on humans during emergencies and for complex issues.
• What business improvements do you need to make, and how can AI enable the solution? For instance, routine customer questions that are being handled by an employee through manual scripting could be modernized by implementing a virtual assistant that is programmed to respond more quickly – and for a lower cost. Moreover, this automation frees the employee to focus on more complex engagements that require a more human touch.
• AI capability is a competency to learn and develop. Effective management and adoption of AI technology requires skills such as creative thinking and experimentation, data interpretation, and in-depth domain expertise. Additionally, as tasks are automated, employees need to adapt to new ways of working, and many will need to be trained to use the new AI tools for daily operations.

Nearly 80% of AI projects don’t deliver a return on investment. To maximize investment in AI technology, organizations must think beyond the implementation. True Digital Transformation impacts the structure, culture, and business processes of an organization.

It is critical to develop a strategic plan that enables the sustainability of the AI solution. This preparation includes designating people to continually work to ensure the AI agent functions properly, securely, and to its capacity. It may also involve developing new capabilities internally or hiring talent that possess the required skills. Either way, organizational roles will need restructuring to effectively support the desired outcomes of new processes.

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By integrating AI with EQ, hospitality organizations are positioned to deliver a new level of personalization, build lasting relationships with customers, and establish organizational resilience for the future. Ready to take your organization to the next level? Reach out to one of our consultants using the “Contact us” button above to learn more.

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