Sensor Flow wins HICAP’s first Tech Challenge, showing what’s top of mind for hotel executives
In moderating the “Views From the Boardroom” panel, at the HICAP hospitality investment conference last week, I did some homework to find out how boardroom conversations in hospitality companies had changed in the last 10 years.
According to ChatGPT, the top three topics in 2013 were Technology and Online Booking, Customer Reviews and Reputation Management and Sustainability and Green Initiatives. Fast forward to 2023, and the list came up in this order – Sustainability and ESG (Environmental, Social, and Governance) Initiatives, Technology & Digital Transformation and Strategic Growth Opportunities.
So not exactly revolutionary but more evolutionary, and this was the list I put forth to my panelists which included Beh Siew Kim, chief financial and sustainability officer, CapitaLand Investment; Choe Peng Sum, CEO of Pan Pacific Hotels Group; Jeff Wagoner, president & CEO, Outrigger Hospitality Group; Jean-Jacques Morin, president, Economy, Midscale and Premium, Accor and Christopher Hartley, CEO, Global Hotel Alliance.
Perhaps the most significant change in the sustainability stakes is the marriage between finance and sustainability as in the role and responsibility now carried by Beh of CapitaLand Investment. Prior to this role, she was CEO of Ascott Residence Trust Management.
The tie-up between the two roles is significant, said Beh, because finance is about short term and managing costs and sustainability is about the long term. Looking at it through both lenses brings a more complete perspective because with sustainability becoming a core business consideration, it affects both revenues and topline – which means a loss of business and a cost – if not implemented.
The other discernible shift is seeing sustainability more from a revenue perspective versus cost, with the panellists saying this was the lens they were now viewing the issue.
For Choe, yes, investing in sustainability measures is a heavy financial lift but it is a necessary cost of doing business today.
He does not believe travellers should pay more for sustainable hotels nor should they be rewarded for sustainable behaviour in hotels. For him, it is what travellers are demanding and if you don’t do it, you will lose the customer anyway.
A Booking.com survey from April 2023 shared that:
- 76% of travelers say they want to travel more sustainably over the coming 12 months.
- Nearly half (49%) of travelers believe more sustainable travel options are too expensive
- 67% now turn off air conditioning (up 29% from 2022), while 60% re-use the same towel multiple times (up 25% from 2022)
Choe noted there’s also a lot of low hanging fruit to address – such as electricity and energy costs. For example, the ballroom we were in was freezing, a point he noted. “Airconditioning uses a lot of energy and costs a lot. By just addressing this, you get a lot of savings.”
Sensor Flow’s CEO Saikrishnan Ranganathan wins the first HICAP Tech Challenge – the judges’ pick shows what hospitality leaders are preoccupied about, energy savings. Right, Jonathon Zink, chief operating officer, The BHN Group, Northstar Travel Group.
By the way, the winner of the first HICAP Asia Pacific Tech Challenge was Sensor Flow, a Singapore-based company that combines the use of wireless IoT solutions and AI-driven automation for energy optimisation for buildings. CEO Saikrishnan Ranganathan said it can achieve up to 30% savings in energy use and it can be installed as a device in individual rooms which means there’s no need to rip out the entire building, making it suitable for old-builds. He said it is in use in 104 hotels across nine countries.
Sai and his co-founder Max Pagel recognised that hotels are one of the biggest victims of poor energy efficiency. “However, like most buildings and properties, they face large barriers to adopting existing solutions as many properties are limited to small Operations Expenditure budgets and available solutions are not only costly but also massively disruptive to install. With that, SensorFlow developed a retrofit IoT solution that enables any building/property on any budget to optimise their energy consumption with no operational disruptions and at no upfront cost. We also help improve a building’s overall productivity and efficiency by providing actionable insights from big data collected via our large network of advanced IoT devices.”
The push by hospitality companies to get to nett zero by 2050 – a goal almost every organisation has set – will open up new opportunities for entrepreneurs such as Ranganathan and his co-founder Max Pagel to address. That it was the choice of judges – which comprised mainly hotel owners and investors – showed what their current preoccupation is.
Beh, whose properties use Sensor Flow, said it was about “getting our people to think: what sustainable initiatives can they do at property level without causing them any more money? When you set targets for them, they become creative. People generally want to be engaged and to be contributing.”
Collectively, the leaders seem fairly confident their organisations can get to nett zero by 2050. When asked to rate on a scale of 1-10, how confident they were of reaching this goal, most rated it between 7 and 8.
Wagoner however added the caveat that a lot depended on the entire eco-system including the supply chain. “There are a lot of factors beyond our control,” he said.
I also asked them to pick the hospitality trend they were most excited by, in this list of five trends cited by WATG in its latest survey.
- Luxury brand collaborations embrace the ‘Experience’ Economy
- Private members clubs target the ‘Daycations’ sector
- Branded ecosystems expand guest experiences – hotels venturing into adjacent lifestyle concepts
- Scaled-up accommodation becomes a permanent fixture – riding on the rise of multi-generational, blended travel and longer stays.
- Innovative amenities redefine expectations
Their choices were between 3 and 4.
Beh shared her reasons for choosing 4.
- Post covid, I have seen a shift in the travel patterns, definitely an increase in multi-generational, blended travel and longer stays.
- This has seen a rise in accommodation that cater to longer stay, more hybrid style accommodation, eg apartments or co living. (which is the space Ascott is in)
- In addition, post Covid, with WFH has become prevalent across most industries, people are travelling overseas while “WFH”.
- Blended travel is also generally more flexible, can travel at any time of year which is great as it mitigates the peak season travel.
- Overall, blended travel increased demand for apartment style accommodation for longer blended travel.
“I am excited with this change because it’s a huge market for us to tap into and varied across all age group and travellers, and I believe this trend is here to stay for a long time,” she said.