Reengineering of Hotel Business Processes in the Context of

Digitalization and Sustainability

Elena Lysoivanenko

, Natalia Makshakova

and Denis Udalov

Moscow State University of Sport and Tourism, 43a Kronshtadsky Blvd, Moscow, Russia

Keywords: Reengineering, Business Processes, Hotel Enterprise, Digitalization.

Abstract: The purpose of the article is to form the organizational and managerial basis for the reengineering of hotel

business processes in the digital economy. In an unstable environment, to optimize the financial and economic

state of the hotel's business processes, it is necessary to use innovative technologies, in particular,

reengineering technology. The system of hotel business processes is described, highlighting their main blocks.

Three types of enterprises have been identified for which the use of reengineering is necessary and expedient.

The main tools for reengineering business processes are identified and their content is described. The

technologies of digitalization of the hotel business process reengineering base allow for the most

individualized interaction, which leads to an increase in the level of customer satisfaction. To successfully

create the organizational and managerial basis for reengineering the hotel's business processes, active

adaptation and transformation to the requirements of digitalization are required. The process of reengineering

the hotel's business processes based on the principles of digitalization means the introduction of innovative

technologies into business processes and radical changes in management and corporate culture.

1 INTRODUCTION

Sustainable development of hotel enterprises includes

the simultaneous solution of diverse and largely

contradictory problems of economic growth,

provided that the quality of the environment is

preserved, assessed primarily in accordance with

social, economic, environmental, institutional aspects

and the aspect of information communication

technologies.

Improving the sustainability of a hotel business is

a way to protect it from the negative impact of internal

and external factor sustainability s and to ensure

stable profitable work. The introduction of a process

approach in hotel management is one of the most

relevant approaches in management. The

implementation of this approach lies through the

reengineering of business processes.

Assessing the sustainability of an enterprise is

often reduced to assessing its financial sustainability.

However, in our opinion, financial sustainability only

indirectly reflects changes in the sustainability of an

https://orcid.org/0000-0000-0000-0000

enterprise due to the introduction of reengineering of

business processes. In this case, organizational and

structural changes occur at enterprises, changes in the

thinking and responsibility of the enterprise

personnel, as well as optimization of communications

between business processes. In our opinion, these

changes are most fully reflected in the organizational

component of sustainability.

The main goal of business process reengineering

is the qualitative improvement of specific areas of

enterprise activity. The essence of the formation of

business processes of an enterprise lies in the

development and adaptation of an enterprise

management system in accordance with modern

challenges in the context of digitalization.

Despite a significant number of studies in the field

of reengineering, in most works, insufficient attention

is paid to the formation of organizational and

managerial support for reengineering of business

processes in an enterprise in the context of

digitalization.

214

Lysoivanenko, E., Makshakova, N. and Udalov, D.

Reengineering of Hotel Business Processes in the Context of Digitalization and Sustainability.

DOI: 10.5220/0010666300003223

In Proceedings of the 1st International Scientiﬁc Forum on Sustainable Development of Socio-economic Systems (WFSDS 2021), pages 214-220

ISBN: 978-989-758-597-5

The state of the management structure and the

system of internal organizational and technological

interactions of many Russian hotel enterprises does

not correspond to the new business conditions. The

state of their management as a business management

system is one of the most important problems.

Considering the most acute problems, we can

distinguish both functional and systemic, the solution

of which requires a radical restructuring of the

enterprise. As a method of reconstructing existing

enterprises, we see business reengineering as the most

promising. This approach allows, on the basis of a

radical redesign of business processes, to achieve

sharp, abrupt improvements in the main indicators of

activity: cost, quality, service and production rates.

Unlike traditional management, the object of

reengineering is the processes occurring in the

internal and external environment of the company,

while information technologies are its integral part

and play a decisive role.

The use of information technology allows

organizations to empower the reengineering of their

business (Susanto et al., 2016, Susanto et al., 2016).

The use of information technology expands the

possibilities of business process reengineering at

different stages of the life cycle of commercial

enterprises (Sungau and Msanjila, 2011). Olalla

(2000) emphasizes the importance of information

technology in business process reengineering. His

work has demonstrated that enterprises can make

radical changes in the management system and

production technologies, using, among other

influences, information technology.

Reengineering involves “radical improvements,”

not just small adjustments to the bottom line. Today

it is obvious that it is practically impossible to make

such profound changes in all enterprise systems

without the support of information technologies. The

development of information technology provides the

emergence of various alternatives for the

implementation of processes that were not available

in the past. There is a relationship between business

process reengineering and information technology.

Hammer (1990) considers information technology to

be an essential prerequisite for performing business

process reengineering. Organizations that strive for

high levels of innovation through reengineering

cannot achieve their goals without relying on

information technology (Najjar et al., 2012). Irani et

al. (2002) argued that innovation in data management

is an important segment of business process

reengineering. It is becoming increasingly clear that

reengineering and information technology are

inextricably linked and interdependent (Kohli and

Hoadley, 2006). Information technology must have a

number of important functions in the reengineering of

business processes: motivation, impartiality, driving

force, empowerment and proactivity. Their success in

implementing these functions will be the key to

successful reengineering of business processes.

Digital transformation is characterized by the use

of new and frequently updated digital technologies to

solve specific problems. The role of Industry 4.0 in

driving digital transformation was an area of intense

research prior to COVID-19, but the pandemic has

accelerated this process. The focus has shifted

dramatically from digitizing data to digitizing

business processes across many industries. The

digitalization of production has made it possible to

create new production processes within the

framework of the key technological trends of Industry

4.0.

The main problems associated with the

introduction of digital technologies in business

processes can be described as a lack of readiness,

when organizations do not yet perceive the benefits

offered. At the moment, there is a low awareness and

lack of knowledge related to specific digitalization

and business process reengineering technologies.

Digitalization is having an increasing impact on

processes in organizations, leading to significant

changes in their existing work procedures (Legner et

al., 2017). The emergence of new digital technologies

allows organizations to accelerate the digitalization of

business processes (Denner et al., 2018). Digital

technologies are being introduced into the processes

of interaction within the organization, as well as with

customers and suppliers (Harmon, Wolf, 2016).

The application of the concept of business

processes is widely described mainly for industries

characterized by a high level of standardization, for

example, in transport, industry, education. However,

the number of studies on this issue in the service

sector is very limited. In the work of Krstic, Kahrovic

& Stanisic (2015) the system of business processes of

the hospitality industry is presented. The authors

identified different levels of processes: main

processes, auxiliary processes and management

processes. This approach has recently been adopted

by many authors (Chalupa and Petricek, 2020; Xuhua

et al., 2018).

The reengineering process was used to improve

the efficiency of the hotel business (Nebel et al.,

1994). During the reengineering procedure, the main

(customer-oriented) processes for quality

improvement were identified and analyzed. Through

reengineering, hotel managers were able to measure

Reengineering of Hotel Business Processes in the Context of Digitalization and Sustainability

215

performance based on customer-centric criteria

(Sinclair and Sinclair, 2009).

Ozdemir, Colak & Shmilli (2019) and Beldona,

Beck & Ou (2001) propose the use of innovative

technologies to optimize hotel business processes.

The article by Aksu (2001) describes the use of

modern technologies for the control of technological

processes and their reengineering in the context of

total quality management. Process management has

played a crucial role in the management of service

quality and human resources (Akoğlan Kozak and

Acar Gürel, 2015).

2 METHODS

The methodological basis of the study is fundamental

works, concepts, methodological and reference

materials, developments and scientific

recommendations in the field of reengineering of

business processes and the practice of introducing

changes in the business model of an organization.

The instrumental and methodological apparatus of

the research includes general scientific methods: the

method of comparison, generalization, analysis,

synthesis and structuring, forecasting, grouping of

statistical data, analysis of theoretical and factual

materials, a systematic approach in relation to

improving the tools for reengineering business

processes.

3 RESULTS AND DISCUSSION

The purpose of the article is to develop a mechanism

for organizational and management support for the

reengineering of hotel business processes in the

context of digitalization. Each business process in an

enterprise is considered as a set of operations that

transform material or information resources into

appropriate flows in order to increase the level of

enterprise development in the context of

digitalization. The law of the rational functioning of

business processes in an enterprise can be perceived

as an organizational and logical connection between

the solution of problems and the tasks associated with

them. Accordingly, business processes have internal

links between business tasks.

A business process is a set of interrelated activities

(tasks to be solved, work performed) that take place

in time and, according to a certain technology, form

input and output parameters. The main business

processes of the hotel (Figure 1):

 "Accounting and financial activities" -

accounting, reporting to regulatory authorities,

budgeting, etc.;

 "Engineering and technical support" - carrying

out various types of repair work, monitoring the

condition of premises and technical equipment,

etc.;

 "Household support" - room fund maintenance:

cleaning, linen change, etc.;

 "Staffing" - hiring, dismissal of employees,

introduction of hotel personnel: briefing,

trainings;

 "Ensuring the safety of life" - ensuring the safety

of people living in hotels, taking measures to

preserve their lives, health, property, etc.

Associated business processes include:

 "Provision of additional services" - for example,

booking seats in restaurants, tickets for various

types of transport, calling a taxi, ordering tickets

to theaters, assistance in organizing excursions,

etc.;

 "Laundry service" - laundry, dry cleaning,

ironing and minor repairs of clothes;

 "Parking" - services for storing the car, it is

possible to provide additional services for car

washing, refueling, etc.

Management business processes include:

 "Strategic planning" - determining the direction

of the organization's development and decisions

taken to achieve development goals (target

indicators: percentage of room stock, rating in

the booking system, etc.);

 "Budget planning" - drawing up short-term,

operational and tactical plans for the

organization's activities, estimates of income and

expenses;

 "Risk management" - identification of risks

(what risks the hotel business may face),

assessment and analysis of risks (determination

of the likelihood of risks and the amount of

potential damage from adverse events),

prevention of risks (development of measures

that reduce the likelihood of occurrence or

minimize the possible consequences of

occurrence of adverse events events), monitoring

and control of risks;

 "Quality management of hotel services" -

management of requirements for services,

development of regulations for their provision,

monitoring of service delivery processes and the

removal of process metrics to obtain feedback on

the compliance of services with requirements and

regulations, quality audit procedures, for

example, "secret client";

WFSDS 2021 - INTERNATIONAL SCIENTIFIC FORUM ON SUSTAINABLE DEVELOPMENT OF SOCIO-ECONOMIC SYSTEMS

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 "Personnel management" - the development of

incentive programs, the introduction of

indicators of efficiency and effectiveness of

employees and their target values, management

of personal career paths of employees.

Figure 1: The main directions of development of business processes of the hotel

With a positive assessment of the activity of

business processes at the enterprise, strategic plans

for the development of business processes are

developed. In case of a negative assessment of the

activity of business processes, reengineering tools are

introduced to reorganize and improve the activities of

the enterprise (Table 1).

Table 1: Implementation of the main reengineering tools for

the reorganization and improvement of the enterprise.

Tools Content

Eliminate

unnecessary or

long streams

Reengineering eliminates

unnecessary work. Most of the

verification, reconciliation,

anticipation and tracking measures

are counterproductive work that

arises from the fragmentation of

business processes and must be

eliminated as a result of rewor

Troubleshooting

business

processes

Reengineering allows you to

eliminate problems in business

processes that quite often occur in

enterprises with a spontaneous

anization of activities

Reducing the

amount of

resources

involved in the

business process

In every job that creates business

processes, you need to reduce as

many resources as possible, for

example, by combining tasks in such

a way that the employee performs

them most efficiently. The key

challenge here is firing employees

and combining different functions,

as a result of which entire

departments are removed from the

rocess

Execution of

business

processes by a

customer or

supplier

Key parts of the business process

that were previously performed in

the enterprise can be transferred to

another enterprise, which can

radically change the business

rocess

Reengineering of Hotel Business Processes in the Context of Digitalization and Sustainability

217

Multiple

versions of

complex

processes are

created

Traditional business processes tend

to rule out many different situations.

The processes in the enterprise must

have many variations, that is, they

must be varied. It is possible to

create a multidimensional process,

since each option is intended only

for certain types of situations. The

required process variant is

determined by pre-sorting based on

redefined procedures

Combination of

several

developments

into one

The main feature of the redesigned

business processes is the integration

of many different or work tasks. In

this case, different designs can be

combined into one

Simplification

of work

Traditionally, in an enterprise,

workers have few skills and

insufficient time or training

opportunities. Therefore, their tasks

are simplified. However, this

requires complex business processes

to link work tasks. Businesses have

to experience the inconvenience,

inefficiency and significant cost of

complex processes to take advantage

of such simplified tasks

An enterprise is a complex system that

implements many dynamic business processes. It is

quite obvious that the efficiency of an enterprise, its

profitability, competitiveness and cost are largely

determined by the efficiency of the implementation of

business processes at this enterprise. It turns out that

even in the "best of the best" enterprises, many

business processes are implemented so ineffectively

that the time and resources spent can be reduced

tenfold without compromising the quality of the task

performed by this business process. There are three

types of enterprises for which the use of

reengineering is necessary and advisable (Figure 2).

Figure 2: Types of enterprises for which reengineering is necessary and advisable.

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The concept of reengineering business processes

in enterprises is based on the following provisions:

 an enterprise or business is a system of

sequentially-parallel interconnected business

processes;

 business processes have an incoming flow of

potential resources;

 each business process functions according to its

own internal rules, algorithms, laws and has its

own transformation technology;

 each business process has at least one connection

with other business processes;

 the business process runs in time, repeats

cyclically;

 a business process consists of a variety of tasks

to be solved with organizational-logical, time

and flow schemes of relationships.

Principles of separation of business processes in

an enterprise:

 the principle of completeness of the composition

of business processes at the enterprise;

 the principle of non-implementation of business

processes at the enterprise (no intersection of the

tasks of business processes);

 the principle of determinism of business

processes at the enterprise (certainty);

 the principle of interconnectedness of business

processes in an enterprise (a business process has

at least one connection with other business

processes);

 the principle of autonomy of business processes

at an enterprise (logical completeness of business

processes);

 the principle of resource intensity of business

processes at the enterprise;

 the principle of productivity of business

processes in the enterprise (availability of the

initial product);

 principle of dynamism (variability of input

resources, internal rules, algorithms, laws and

initial products in time).

For the effective formation of organizational and

management support for the reengineering of

business processes at the enterprise, it is necessary to

actively adapt and transform to the requirements of

digitalization. The process of ensuring the

reengineering of business processes at an enterprise

on the principles of digitalization includes the

introduction of modern technologies into business

processes and means not only the installation of

modern hardware or software, but also fundamental

changes in the approach to management, corporate

culture and external communication. As a result, the

company gains a reputation for being a progressive

and modern system. Digitalization technologies for

ensuring the reengineering of business processes in an

enterprise allow organizing the most personalized

interaction, which is preferred by most of the

customers. Digital communication channels, artificial

intelligence, robotization - all this must be

implemented by an enterprise in order to achieve

success. You need to act quickly and flexibly: change

not when you can, but when you need to. The digital

transformation of business processes at an enterprise

is designed to provide conditions for making effective

management decisions, quickly adapt its work to

modern requirements and meet the needs of

consumers. Cloud technology allows multiple teams

to work simultaneously on the same project and

efficiently use enterprise resources. Ready-made

solutions save time on problem solving. Various

programs and extensions optimize the operation of

the enterprise and require a minimum amount of time

for their implementation and adaptation.

4 CONCLUSION

According to the results of the study, it was revealed

that in the turbulent conditions of management at

hotel enterprises, in order to improve the financial and

economic state of business processes, there is a need

to use innovative and progressive technologies, one

of which is reengineering technology. The main goal

of business process reengineering is the qualitative

improvement of specific areas of enterprise activity.

The essence of the formation of business processes of

an enterprise lies in the development and adaptation

of an enterprise management system in accordance

with modern challenges in the context of

digitalization. For each business process, a set of

input resources, operating rules and expected results

are formed. The process of ensuring the reengineering

of business processes in an enterprise based on the

principles of digitalization has opportunities for

innovative ways of their development, which is

effective due to a large number of tools.

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