applications and competitive
advantage in hotel companies
Anil Bilgihan, Fevzi Okumus, Khaldoon “Khal” Nusair and
David Joon-Wuk Kwun
Rosen College of Hospitality Management,
The University of Central Florida, Orlando, Florida, USA
Purpose – This paper aims to propose a conceptual framework that illustrates how information
technology (IT) applications may lead to competitive advantage in hotel companies.
Design/methodology/approach – The paper is written based on a synthesis of previous literature
in this area.
Findings – Multiple areas need to be carefully evaluated in developing and implementing IT projects
so that they can lead to competitive advantage in hotel companies. There are four closely related areas
when analyzing IT decisions in hotels, which include coherence between the business strategy and IT
decision, types of IT applications, intended beneﬁts of IT decisions, and decision-making style.
Technology sophistication, management skills, and integration of resources are key issues when
implementing IT decisions. Investments into IT applications in hotel companies can lead to superior
IT competencies and IT capabilities, which can subsequently result in lower cost, agility, innovation,
added value for customers, and better customer service. However, not all IT investments may result in
positive outcomes or their sustainability may be short lived. In addition, there can be a lag time
between making IT investment decisions and seeing their intended outcomes.
Practical implications – There are multiple areas and issues that need to be considered in making
and implementing IT investment decisions if they are to contribute to the company’s competitive
advantage. Hotel companies need to be selective in their IT investment decisions and look at each IT
investment from the strategic management perspective.
Originality/value – This is one of the ﬁrst articles in the hospitality ﬁeld that offers a theoretical
framework on how IT applications can lead to competitive advantage in hotels. It also offers numerous
theoretical and practical implications. Therefore, this paper should help hotel executives and
researchers in evaluating IT projects in hotel companies.
Keywords Information technology, Competencies, Competitive advantage, Hotels, Lodging industry,
Technology, Applications, Investments
Paper type Literature review
Information technology (IT) investments play a critical role in managing hotels
strategically. Efﬁcient and timely deployment of new IT applications may offer
opportunities for enhanced guest services to meet increasing customer expectations,
improved cost control, more effective marketing strategies, and expanded opportunities
for hotels (Law and Jogaratnam, 2005; Piccoli, 2008). It is evident that IT investments will
increase hotels’ productivity, reduce their costs, and at the same time add value to
the services and products offered to their customers. Therefore, investments into
IT applications in hotels have increased over the past decades (Armijos et al., 2002;
Ham et al., 2005; Piccoli, 2008). There is a need for extensive research studies that
The current issue and full text archive of this journal is available at
Received 22 January 2011
Revised 16 March 2011
Accepted 24 March 2011
Journal of Hospitality and Tourism
Vol. 2 No. 2, 2011
q Emerald Group Publishing Limited