Transforming hospitality
Scanning the past and future of S Group hospitality transformation for clues of the building blocks of sustainable digitalization in the luxury business
This article was originally published in SOK Design.
Hospitality has always been an experience business at the core. To assemble together these experiences, the culture and practices need to be right for the teams that make them possible. Sokos Hotels and other S Group services, SOK hospitality operators, have been pushing the boundaries of the customer- and people-centricity for the last 5 years by uniting cross-functional teams into the unique culture where healthy digitalization is a shared mindset and insight-driven decision-making can be done by anyone.
In order to get the best value out of design capabilities and methods, it’s instrumental to innovate and operate together, as a cross-functional team, and share the same customer-centric priorities and goals. By approaching common challenges and solving problems together with a similarly shared way of thinking, we ensure value creation.
Maria Uhari-Pakkalin, Director, Design, SOK
Behind the scenes, the hospitality service resembles a rhythmical machine as both people & technology have to work seamlessly for guests to enjoy their stay. On average, customers use hospitality services just a few times a year, and hospitality operators are pushed to explore creative ways to engage customers in between those trips. SOK knows the needs, and tailors experiences for a broad range of customers: from couples and families looking for a short get-away, business travelers, and more luxury-oriented customers who seek one-of-a-kind local experiences — to internal stakeholders, such as hotel staff & local co-op and subsidiary partners that essentially implement the full scope of service to their customers.
According to Juho Kangas, Product Owner, and Quan Minh Dao, QA lead for Sokos Hotels website renewal, working at this level of complexity requires high levels of trust & transparency, visionary leadership & shared sense of direction, and a connected growth mindset from everyone involved. More than anything, the product teams need to share the many realities our customers & hotel stakeholders come from, walk in their shoes, and anticipate what they think or might feel challenged by.
Design thinking in action
Over the last 4.5 years, the design team at SOK has grown to 40 professionals. As communicated in SOK Design vision: design is more than a unit — it is a mindset and craft integrated into everything we do to make our customers’ everyday taste special. In Sokos Hotels, this integrates deeply into the mission of making people love hotels. The anniversary of Sokos Hotels is just around the corner: the chain of nearly 50 hotels is reaching a 50-year mark next year. Spread vast across Finland — from Vaasa to Koli, and Levi to Helsinki, and in Tallinn, Sokos Hotels is often described as the most trusted and valued hospitality partner by its customers and has lately been selected as a winner of the World Branding Awards in a Hotel Brand Of The Year category.
Since the introduction of the praised Sokos Hotels mobile app, currently targeted at business loyalty customers, siloes between teams & departments started melting to enable more diverse stakeholder groups to collaborate and exchange useful data & insights in real-time. In a true cooperative sense like with the rest of S Group’s businesses, hospitality customers too are more than passive receivers of services, but proactive participants in service creation & validation, and managers of their own data.
Thinking in systems
While hospitality is a business of experience, it is also a business of responsibility. The new wave of thinking through combined human-, social-, and planet-centric lenses require adaptation of new practices on scale, constant learning, considering the broader group of stakeholders — including non-human — and different infrastructure altogether.
The key to consistent long-term improvements is to raise our maturity both inside the development teams and in collaboration with other teams.
At SOK, we have good foundations for raising maturity inside the teams through e.g., biannual service maturity assessment. Support from horizontal teams and competence communities is important to propagate best practices across the organization. For example, the DevOps team helped Sohvi (Sokos Hotels renewal project) enable continuous delivery which has brought significant improvement in our quality practices and feedback loops.
For collaboration outside the team, it’s all about keeping the relevant stakeholders close and deciding the best way to work together. For example, during my time on the team, I have witnessed direct communication channels being established between developers and stakeholders. This makes it easier to figure out the intricacies of the hospitality domain with shorter lead times and fewer misunderstandings.
Martin Yrjölä, Tech Lead, Sokos Hotels Renewal, Netlight Consulting Oy
One of the core values of S Group is to take responsibility for people and the environment. In practice, this is reflected in systematic corporate responsibility and through Sokos Hotels’ work with local partners for the benefit of the regions. From 2025, S Group will self-produce volumes of renewable wind energy enough to cover the entire retail chain’s electricity consumption. Reducing food waste and nudging customers to explore healthier behaviors during their stay are concrete examples of everyday sustainability work. As such, Sokos Hotels had been on the frontlines of introducing essential practices like climate compensation via Compensate for customers to take action & responsibility for their carbon footprint. The best part is, the hospitality customers expect and are willing to be more proactive in their own sustainable actions, and hospitality operators have to stay ahead of the curve. Earlier this year, Sokos Hotels was recognized as the most sustainable hotel chain in Finland for the 11th consecutive time.
Resilience now and in the future
Like with any luxury business, hospitality business developers need to tackle the emergence and approach systemic change caused by Covid and economic crises with a critical eye, but also optimism. With remote work becoming a norm after the pandemic, more people have become local digital nomads seeking an urban oasis for both work & leisure. These people can work from hotel lounges, co-working spaces, or hotel rooms. In that light, a recently introduced member of the Sokos Hotels brand family, Heymo, has charmed such nomads with check-in & -out flexibility and higher levels of digitalization & independence.
Resilience comes when you are truly committed to maintaining the quality high by humbly and honestly acknowledging how you are doing. You must be looking for ways to raise the bar for yourself and minimize any customer journey friction through digitalization. Here design methodologies and statistics combined are powerful tools.
There is so much happening in the industry that we must keep looking for ways to delight customers and provide our staff with tools and other means to create wonderful experiences. That said, if I had to pick one trend that I’m very curiously following, it would probably be the flex hotel type where the customer is given a lot of ways to tailor the experience.
Visa Jaatinen, Chief Digital Officer, SOK MaRa Hospitality & Restaurants
In the meantime, the luxury & hospitality sector continues recovering from the pandemic lows & crises with a few emerging global trends. The Global Wellness Institute predicted that global wellness tourism would be worth $1.3 trillion by 2025, with sensual wellness being the fastest-growing sector in the market. People seek more memorable experiences: learn how to rest better, travel closer to their roots & nature, or indulge in unfamiliar experiences altogether.
Among other spearheading developments, accessibility starts to play a more critical role in digital teams & beyond as the new EU Accessibility Act needs to be actualized by 2025. According to the Global Economics of Disability 2020 report, people with disabilities and their families have an estimated $13 trillion in spending power, a market that was often left neglected and whose needs were drastically unmet before in both physical and digital realms across all industries. Seeing as S Group digital ecosystem combines numerous systems & platforms, an extensive and recognized S Design System is in use to ensure high levels of usability & consistency for their users regardless of their impairments, and more lean & cost-efficient work for product teams.
Plenty of cutting-edge technologies are swaying the market, such as metaverse and making it possible for people to digitally re-live their experience or embedded health & wellbeing tech to every stay. The mission of Sokos Hotels remains to meet the one basic need of all customers exceptionally well: provide a temporary home where anyone feels safe & restored. That’s why accessible product & business development carries with it immense value: it has a curb-cut effect to benefit everyone in the end.
Written by Anastasiia Kozina (Senior Product Designer, Nordkapp) and Tilda Mikonaho (Lead Designer, Hospitality, SOK) with irreplaceable support from their teams & colleagues
Photography by Teppo Kotirinta, Nordkapp, with support of Tiina Kuikka, Hotel Manager, Original Sokos Hotel Tripla
Illustration by Phuc Doan, Product Designer & Illustrator, SOK
Nordkapp is a strategic design consultancy of the post-normal era based in Helsinki. We work together with ambitious companies like SOK to enable business strategies for the future and make them tangible & humane in the process.
If you need support in addressing your transformation challenge or wonder where to go next, explore it with Matti Mölsä over a short call: matti@nordkapp.fi or +358 40 727 3094
Otherwise, keep exploring how strategy, change, and experience can be created with our Future Is Present Tense blog.
