Giving a worldwide communications system room to grow
With the rapid acquisition of hotel chains around the world, NH Hoteles found its growth was putting severe strains on its in-house ICT network. See how Telefonica helped NH Hoteles transform its IT infrastructure into a cost-effective, innovative and fully integrated global communications network.
Business growth strains networks
NH Hoteles is one of the leading hotel operators in Spain, currently ranking third among European urban hotels. The company owns 349 hotels with 52,793 rooms in 22 countries in Europe, America and Africa (as of July 2009), employing over 18,000 people. The focus at NH Hoteles is on quality, both in services and facilities, to cater to all tastes and make guests feel comfortable. NH Hoteles' establishments offer the most advanced technologies designed to facilitate the guest's communication as well as their work and leisure.
In 2000, the Spanish company began rapidly expanding in Europe and the Americas through the acquisition of other hotel chains. However, with each new group of hotels came a whole new communications system, one that needed to be integrated into the in-house, non-centralised ICT network NH Hoteles was running.
NH Hoteles only had 50 people working on its worldwide IT system, and by 2002, the team had become completely overwhelmed. The scope and complexity of its communications network was not only becoming too much for its IT managers to handle, it was also causing costs to multiply and limiting business profitability. In an effort to contain expenses, NH Hoteles decided to consider an outsourcing partner.
Looking for the whole ICT package
NH Hoteles IT managers knew what they needed: security, reliability, scalability. And critically, they wanted access to managed data centres with industry-leading server consolidation and virtualisation technologies that also combined business continuity and application hosting services. NH Hoteles executives were also clear: make significant cost savings.
After evaluating all the major players in the outsourcing market, NH Hoteles contracted with Telefonica. The decision was made because Telefonica could provide everything on the hotel group's long list of requirements, especially the cost savings it wanted. Another factor was that through the Telefonica managed data centre in Madrid, NH Hoteles could utilise all of the hosted services it required for its centralised shared services operations support. This was important not only for NH Hoteles' current operations, but also for the company's expansion plans, particularly in the Americas and Europe.
In 2002-3, the NH Hoteles ERP and CRM systems, including all of its back-office applications like HR and finance, were migrated over to Telefonica's managed data centre.
Internally, NH Hoteles had committed to a total organisation change and its IT management was focused and absorbed on such a complex transition. Telefonica's engineers continue to work closely with NH Hoteles to ensure that the ongoing implementation of its innovative IT systems goes as smoothly as possible.
Folding new hotels into the system, seamlessly
The first major success was connecting 250 hotels to the new hosted MPLS network within three months.
NH Hoteles is now able to manage its networks from a central point with comprehensive platform security, and is comfortably managing 7,000 IT users with 6,000 PCs over 115 nationalities.
Additionally, NH Hoteles has the ability to easily connect new hotel chains to its system as needed. For example, 60 recently acquired hotels in Italy were fully operational on the NH Hoteles communication and network applications in just three month.
During all of this change, the NH Hoteles growth strategy was working well: pre-tax earnings, or EBITDA, rose from €155 million in 2003 to €281 million in 2008. In 2009, NH Hoteles is carrying out 55 new hotel construction projects, which will provide more than 8,000 new rooms.
As the global recession has hit the tourism industry particularly hard, creating extremely challenging trading conditions, NH Hoteles sees outsourcing as essential for managing expenses while keeping the quality of its communications high.
In fact, in such a competitive leisure and travel market, NH Hoteles sees innovative ICT as an important asset and selling proposition. As the company promotes on its website: NH Hoteles offers "the most advanced technologies designed to facilitate the guest's communication as well as their work and leisure."
