Runtriz - The Leader of mobile Hospitality

Table of contents

(I) List of figures and tables

(II) List of abbreviations

1. Introduction
1.1 Background and Purpose of the Topic
1.2 Methodology

2. Case Description
2.1 The History of Runtriz
2.2 Introduction of the Invention Hotel Evolution

3. Theory
3.1 Definition of Service Innovation
3.2 Service Innovation Models
3.2.1 Models from Gallouj and Weinstein
3.2.2 Models from Michel, Brown and Gallan

4. Case Analyses
4.1 Radical Innovation
4.2 Incremental Innovation
4.3 Changing the Customer Roles and Firm`s Value Creation
5. Conclusion

(III) List of references

(I) List of figures and tables

Figure 1: Changing the Customer Roles and Firm`s Value Creation

(II) List of abbreviations

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1. Introduction

1.1 Background and Purpose of the Topic

The service industry, especially the hospitality industry, has to handle high pressure from competition and frequently changing demands from their customers (Victorino et al., 2005). Hotels have to establish a unique offering or service for their guests, to highlight themselves on the market. A way to generate a successful establishment within the hospitality industry is to implement and develop innovations, which can be seen as the creation of an extra value for the guest (Victorino et al., 2005). Findings from various articles and books like Service innovation and customer choices in the hospitality industry from Victorino et al. in 2005 and Open Services and Innovation from Henry Chesbrough in 2011, lining out that Service Innovations have an impact on the choice of customers and are a “clear and sustainable way to grow a business” (Chesbrough, 2011, p.13). Therefore, innovations have been coming into focus of importance also in the hospitality industry. (Victorino et al., 2005)

Runtriz, a company from the United States, has specialized itself in offering mobile solutions for luxury hotels. Their newest invention is called Hotel Evolution and was brought at the market in 2008. Hotel Evolution is a mobile touch screen platform, which allows guests to communicate and interact with the staff in the hotels (Enz et al., 2010). The question arising is what is the actual innovation of Hotel Evolution. Therefore, the overall aim is the analysis of the innovation, Hotel Evolution. Different theories and models will be used to apply the chosen case with scientific theory.

1.2 Methodology

The report will be based firstly on a short illustration from the chosen company and their innovation, to have a good starting base for the later discussion, analysis and the solution finding. Secondly, different Service Innovations and models will be described and a definition of the term Service Innovation will be done in chapter 3. Thirdly, the chosen theories and models will be connected with the case of the innovation, Hotel Evolution.

A literature conducted analyze is used to gain the theoretical knowledge. The usage of different studies, professional articles and internet sources, shall help to achieve a direct connection between theory and practice.

2. Case Description

2.1 The History of Runtriz

“The hospitality industry had not fully grasped opportunities that modern technology provides and customers demand” (Enz et al., 2010, p.18). This statement was given by Matthew Allard, who is the president and founder of Runtriz. Runtriz is the premier Los Angeles-based global hospitality network and has specialized in mobile solutions for the world's top hospitality and hotel brands. The company consists of ten employees, three board members and seven team members. (Runtriz, 2012a)

Allard was working several years in the hospitality industry and recognized existing service gaps within the day to day work in hotels. Even in the luxury hospitality, waiting queues in front of the concierge desks are existing or the quick and impersonal answering of questions, reliant on the high amount of guests per employee. Another important fact, Allard was recognizing, was the gap between the guests’ expectations and the real service offered. Guests want to see certain things and not just hearing them from the employees. The spa offerings, the restaurant and its menu, these are examples, which have to be visible for the guest. Additionally, customers are often uncertain in choosing an unknown service or product, therefore former guest comments about offerings can be helpful for the decision making process of a customer. (Enz et al., 2010)

Allards was considering all those information he gained from his experiences in the hospitality industry and established the application named Hotel Evolution. The next chapter introduces and explains the application.

2.2 Introduction of the Invention Hotel Evolution

The beta-version of Hotel Evolution was the usage of fixed tablets with touch screens within the hotels. This version had two disadvantages for the hotels, which can be named as firstly, high hardware costs and secondly an inflexibility in the usage for the guests. Therefore, the product has been suited for the nowadays demand. Hotel Evolution can now be seen as a mobile touch screen platform, which allows guests to communicate and interact with the staff in the hotel. Meaning, the guest can order their favorite dish during the drive to the hotel or ordering a massage treatment, get directly after arriving etc.. The web-based platform can be used on or off the hotel via Wi-Fi. Guests can use their own smart phones or laptops to use the application, in the following app, but hotels are also providing their guests with tablets if wanted. Hotel Evolution can be fully personalized and “ works closely with each hotel to understand their brand, guests, and operations so the technology works seamlessly with the property” (Runtriz 2012b). Some hotels are providing the direct communication and ordering to different departments, e.g. housekeeping or restaurant. Others are working together with companies at the destination and providing special offers or information about the companies and their offerings at their hotel app. (Enz et al., 2010)

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