Artificial Intelligence as Disruptive Innovation in the Hotel Industry : Finnish Boutique and Lifestyle Hotels Perspective

Abstract

Artificial intelligence or simply AI is a popular topic nowadays. The basics of the concept are based on two main parts – autonomy and adaptivity. AI is entering and helping in many fields these days, including the hospitality and hotel industries. However, new technologies usually often disrupt old ways of performing things. Boutique and lifestyle hotels have rarely been in the focus of researchers. Unique environments and services, with high standards of personal service and human interaction significance, are the most determine characteristics of the boutique accommodation segment. It is crucial to find a balance of relationships between guests, a hotel, employees, and new technologies applications, in order not to ruin providing services and experiences, but to improve them.

The purpose of this study was to find out how new AI technologies can change the management and service practices of boutique and lifestyle hotels. The research was conducted within the Kämp Collection Hotels hotel chain, which has unique luxury hotels with high-quality guest service. Semi-structured interviews, as a qualitative data collection method, were created and conducted in an individual face-to-face way. Interviews were conducted from the hotels’ headquarters perspectives, such as from hotel managers and front desk managers. The collected data were analyzed via content analysis, using both inductive and deductive coding approaches. Disruptive innovation theory by Clayton Christensen, which shows the way new technologies and innovations disrupt an already built and established market, was chosen as a prospective base for this research.

The study results showed that AI technologies have not entered the case study of Finnish boutique and lifestyle hotels yet. Based on the interviews, three areas the AI influences the most were generated: hotel services, guest-host relationships, and working processes. According to findings, most AI disrupted areas will be employees’ tasks when guest-host personal contacts and interactions are needed the least. AI machines’ and programs’ help will be highly appreciated with monotone, repeatable duties, that can be easily automated and do not require much deep thinking. AI might limit guest-host interactions, but at the same time, human-guest communications will become more relevant and complex, therefore improving relationships with guests in general.

The power of AI should be directed to guest personalization preferences to provide high-quality accommodation and services. In the hotel industry, the case is not about machines replacing humans at work, but machines working side by side with humans in the fields they are obviously advanced. In boutique and lifestyle hotels, the possibility of AI disruption is far away from the real future forecast.