The computer millennium bug's impact on the hotel industry: a case study of the kowloon hotel

The computer millennium bug's impact on the hotel

industry: a case study of the Kowloon Hotel

Rob Law

Assistant Professor, Department of Hotel & Tourism Management, Hong Kong

Polytechnic University, Hung Hom, Kowloon, Hong Kong

Mary Lau

Graduate Student, Department of Hotel & Tourism Management, Hong Kong

Polytechnic University, Hung Hom, Kowloon, Hong Kong

Introduction

The Y2K problem originates from computer

hardware and software systems that were

manufactured in the 1960s and 1970s. These

computer systems stored a year field using

two digits. For example, ``60'' represents

``1960'' and ``70'' stands for ``1970''. This design

saved expensive computer memory and disk

space in the 1960s and 1970s. However, in the

year 2000, computers may assume that ``00''

means ``1900'', causing many systems to stop

running and even crash entirely (de Jager,

1997; Fryer and Appleton, 1997). In plain

words, the main problem is that computer

systems would be unable to recognise dates

after 31 December 1999. This poor computer

design is now known broadly as the Year 2000

Problem, or the Y2K problem (Eubank, 1997;

Mecham, 1997). In addition to computer

hardware and software, this problem affects

all computer processor-embedded systems.

Examples of computer-processor systems

that are used in hotels include cash registers,

safes, fire alarm systems, elevators, medical

equipment and telephone exchange systems.

By the time this paper is published, the year

2000 will have already arrived. However, the

Y2K's impact on the hotel industry is

timeless. That is, this problem or other

technological problems can negatively affect

hotel business. This paper should serve as an

example for hotel managers to prepare for

future technology crises.

Today's hotel industry is highly

information-intensive. Hoteliers utilize

hospitality information to enhance

operational efficiency, to provide

personalized guest service and control costs,

and to provide performance indicators such

as profit margins and financial condition.

The day-to-day operations of a hotel require

individual computer systems to work

cooperatively so that the hotel can deliver

quality service to its guests. As a

consequence, Gamble (1991) stated that

computers have changed hotel operations.

Also, according to Watkins (1995), technology

starts and ends with hotel guests. Technology

works when it improves guests' experiences,

and when it makes staff members more

productive and better able to serve their

customers.

The current computer systems running in

a hotel, such as property management and

guest accounting systems, rely heavily on

time-related microchips. Therefore, the Y2K

problem, if it occurs, will definitely affect the

hotel industry.

Van Hoof et al. (1996) found that most hotel

managers are not technologically competent.

Also, Whitaker (1987), as well as Hubert et al.

(1996), identified that the barriers which hold

hotel managers back from the successful

implementation of IT in their businesses are

willingness, ability, and financial

constraints. This implies that it might be

difficult for hotel managers to understand the

seriousness of an IT problem like the Y2K

issue.

If hoteliers cannot solve an IT problem on

time, the entire hotel industry could be

interrupted; business might stop running,

and profitability might fall sharply. Also, an

IT project requires manpower and budget

resources. So commitments from top

management down to supervisors and

operating staff are necessary. In this way, the

issue of IT problems, such as the Y2K, and its

impact should be raised, and hoteliers should

take remedial action immediately before

computers crash and the associated business

failures take place.

Although there exist many publications

about the Y2K issue, many of these

publications were written for computing

professionals, and these publications tend to

The current issue and full text archive of this journal is available at

http://www.emerald-library.com

[ 170 ]

International Journal of

Contemporary Hospitality

Management

12/3 [2000] 170±178

# MCB University Press

[ISSN 0959-6119]

Keywords

Information technology, Hotels,

Hong Kong, Computer disaster

Abstract

Traditionally, the hotel industry

has prided itself on its provision of

quality service and therefore guest

satisfaction. Unfortunately, hotel

managers are often reluctant, or

even resistant, to accept technol￾ogies, fearing that technologies

might change their ability to pro￾vide hotel guests with the perso￾nal attention that characterizes a

typical hotel business. Hotel man￾agers' low technical competence,

and the wide adoption of technol￾ogy-assisted hotel operations,

mean that the hotel industry re￾mains at high risk regarding in￾formation technology (IT)

problems. This paper reports on a

study that investigates the Y2K

readiness in various departments

of the Kowloon Hotel. Based on

the Kowloon Hotel's experience,

this paper serves to inform hotel

managers that: most, if not all,

hotels are at risk of future IT

problems; the cost of a hotel for

ignoring these problems could be

huge, and most importantly; the

problems' influences will be time￾less. That is, IT problems could

have a long-lasting impact on the

entire hotel industry. Research

findings of this paper should be of

interest to hoteliers to better

understand the impact of IT appli￾cations in the year 2000 and

beyond.

The authors are grateful for

the constructive comments

and suggestions provided by

the reviewers about an

earlier draft of this paper.