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AI's Rapidly Evolving Landscape and its Impact on the Hospitality Industry

Know the Risks and Rewards of Integrating This Transformative Technology

Lena Combs and Daniel Cohen-Dumani (Withum)
Lena Combs and Daniel Cohen-Dumani (Withum)

Artificial intelligence has been around for decades and can be defined in one way as the simulation of human intelligence, specifically by machines.

The first discussions regarding artificial intelligence originated in the 1950s, the first chatbot went live in 1964 and college students were studying this concept by the late 1980s. There is nothing new about the idea of AI, so why is it that the world suddenly launched into a frenzy regarding AI and the potential capabilities that could arise through this technology?

In the last five to 10 years, scientists and researchers have redefined what the world views possible through the work of AI. The publishing of open-sourced machine-learning algorithms has expedited collaboration and innovation by making AI technology available to the public at large. This breakthrough in science and cooperation has sparked investment and exploration into AI, and we are seeing rapid acceleration of its deployment and implementation into all aspects of society. Machine-learning models are becoming so advanced that they can now mimic a biological neural network through artificial neural networks.

How Does Generative AI Compare?

Generative AI — which is an advanced branch of deep learning — is the most advanced innovation that the world has ever seen and ChatGPT, which is the most well-known and widely used application of generative AI, quickly acquired 100 million users within the first two months of its public launch. This technology is a simple input/output transaction, but the possibilities are endless. The input, known as a prompt in AI, can be either a question or a task that leads to the machine generating new content in the form of text, image, audio or video. Perhaps the most interesting aspect of generative AI is that it can accumulate conversationally through a series of inputs and outputs to further refine the final product to the user’s wants and needs.

What Is the Place of AI in the Hospitality Industry?

Hospitality businesses are complex. They often operate in moving parts with large staffs and multiple integrated technologies and systems.

AI is expected by many to incite a revolution that forces traditional, inefficient practices to be replaced by newer, more efficient ways of doing things. For a hotel, this could be as simple as chatbots that handle guest communications 24/7.

AI could also be used to screen guest communications and escalate qualified issues to a live human representative. This solution helps all guests feel equally attended to but also manages the workload of each staff member ensuring they are better equipped to handle the bigger issues. For an elevated guest experience, AI has the ability to personalize any conversation when it has access to the guest’s name and preferences.

While chatbots — personalized and generic — are proven and easily implemented in today’s world, there are many more ways to use AI to improve the traditional guest experience. Consider employing AI at a hotel with smart home technology that allows guests to voice-activate lights and appliances. Think further beyond that to a branded concierge-like product that allows the guest to ask for recommendations, book appointments and order meals as if it were a casual conversation with their own dedicated concierge.

Internally, AI might be something worth using for scheduling preventive maintenance or predicting other maintenance needs within the organization. It can also be used for evaluating and reducing the overall environmental impact of a hotel operation. AI can also be used for looking at trends to assist in decisions such as pricing strategy. For example, the hospitality industry has had access to modernized pricing tools for optimized revenue generation for a while now. But think about how much better it would be with AI predicting those trends and adjusting prices in real time without waiting for a pricing tool to analyze the data being fed to it.

What Does This Technology Mean for Jobs?

Artificial intelligence should be thought about in a way to enhance human ingenuity. It should not be something corporations consider as a replacement for human labor but rather a complementary tool that allows employees to get their work done better and faster. Of course, better and faster completion of a job may lead to the lessened need for a human workforce, but it could also lead to completing more work with the same number of people that have increased productivity and efficiency with the use of AI.

What Are the Security Concerns and Risks With AI?

As with anything related to data, the internet and company policies, risks and security are paramount.

It’s important to take a step back and consider what result is desired with the implementation of AI, as well as what's feasible without it. If AI is absolutely needed or could substantially improve upon the desired result, then it is worth evaluating the need for AI on an organizational level. Common things that go wrong when using AI tools are incorrect or nonsensical outputs, social manipulation, data breaches and privacy violations. This technology can be misused either unintentionally or maliciously and it's critical to have contingencies in place that prevent any form of misuse from occurring.

We also must remember that human error exists, so we must also understand that the possibility of error still exists when machines are built with algorithms intended to replicate human intelligence. Hallucinations are a phenomenon in generative AI in which the technology generates false or misleading information presented as fact. This is why due diligence and fact verification are essential best practices when using AI.

There is no doubt that generative AI and the possibilities that come with it will change the world. Knowing how to use it appropriately and responsibly is going to be paramount as we usher in a new age of improved production with this exciting technology.

Lena Combs is a partner and practice leader at Withum, a technology-driven advisory and accounting firm. The company specializes in cybersecurity, digital advisory and hospitality services. Daniel Cohen-Dumani is a partner and digital services market leader at Withum.

The opinions expressed in this column do not necessarily reflect the opinions of Hotel News Now or CoStar Group and its affiliated companies. Bloggers published on this site are given the freedom to express views that may be controversial, but our goal is to provoke thought and constructive discussion within our reader community. Please feel free to contact an editor with any questions or concern.

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