AI Thesis Final Version Converted
AI Thesis Final Version Converted
Lu, To Linh
Bachelor’s Thesis
Degree Programme in Tourism
Bachelor of Hospitality Management
2019
Abstract of Thesis
Artificial Intelligence (AI) is a new technology that has been applied in many
businesses to enhance customer experiences. It has come in many forms and
applications such as chatbots, machine learnings and self-check-in kiosks. In
hospitality industry, there have been researches about AI applications, yet it is
not widely applied in hotels due to many reasons. Therefore, the purpose of this
thesis is to identify the demand for AI in hotels in Ho Chi Minh City, Vietnam
through customers’ points of view since AI is promising to dramatically grow and
benefit the industry in the near future.
The research methodology used in this thesis was quantitative research with
hand-out survey. The target respondents were tourists who stayed or used
services in hotels in Ho Chi Minh City. The survey results came out quite
surprising with different opinions of respondents. Most respondents agreed that
applying AI is a modern trend to follow. Some of the important points to
respondents were always-on service, fast access to service and cleanliness.
Many respondents would prefer to interact with employees than AI machines.
Due to the wide knowledge of AI and limitation of the research, further researches
should be done to gain better perspectives on AI approaches in hotels.
1 INTRODUCTION ............................................................................................ 4
2 ARTIFICIAL INTELLIGENCE IN HOSPITALITY INDUSTRY ......................... 7
2.1 Definition of Artificial Intelligence ........................................................... 7
2.2 AI for Enhancing Customer Services ..................................................... 8
2.2.1 Customer Services in Hotels ........................................................... 8
2.2.2 Hiring the Right People or Hiring Machines ..................................... 9
2.3 Self-Services for Fast Delivery ............................................................. 11
2.4 Examples of Pioneers .......................................................................... 13
3 REGCONIZING DEMAND FOR AI IN HOTELS IN HO CHI MINH CITY ...... 14
3.1 Ho Chi Minh City as a Potential Future Artificial Intelligence Provider
Destination .................................................................................................... 14
3.2 Thesis Process and Time Frame ......................................................... 15
3.3 Quantitative Research Methodology .................................................... 16
3.4 Data Collection .................................................................................... 16
3.5 Limitation and Challenges of Research ............................................... 17
3.6 Reliability and Validity .......................................................................... 18
3.7 Survey Results..................................................................................... 19
3.7.1 Respondents’ Characteristics and Behaviours .............................. 19
3.7.2 Respondent Experiences in Hotels in Ho Chi Minh City ................ 21
3.7.3 Respondent Experiences and Opinions in Artificial Intelligence .... 23
4 ARTIFICIAL INTELLIGENCE SWOT ANALYSIS ......................................... 30
5 DISCUSSION ............................................................................................... 32
BIBLIOGRAPHY ............................................................................................... 34
APPENDICES ................................................................................................... 41
4
1 INTRODUCTION
In the perfect application, it would be a game changer for tourism and hospitality
for providing perfectionist assistants especially in tourism destinations that are
facing problems such as mass tourism or lack of tourists’ interests. Although AI
has been used in science and factories for years, its approach in hospitality
remains limited. At this current time, there are only a few tourism and hospitality
companies adopting robots. For instances, Hilton, InterContinental and Yotel
Hotels are some of the leading brands that apply service robots (Social Tables
2019).
The survey is organized for travellers who stay and/or use hotel services in Ho
Chi Minh City. The target groups are mainly young adults that are under 25 years
old and from 25 to 34 years old. The total number of respondents from these two
age groups account for more than half of the respondents, at 56,7 percent. These
Millennials who are capable of adapting and learning new sciences and
technologies (Davis & Silva 2019), are the potential future guests whose opinions
are important for this study purpose. The other age groups are welcomed to join
in the survey for different perspectives as well.
The results of empirical research are discussed after the research methodology
together with personal recommendations in the discussion part for further
researches since Artificial Intelligence is a trendy yet extensive approach in
hospitality industry. Accordingly, the opportunities, strengths, weaknesses and
challenges of this new technology approach in hotel premises are anticipated to
create innovative customer experiences.
The choice of the topic is decided according to the author’s experiences and
interests in tourism and hospitality industry. Being one of the Millennials, the
author expects to experience modern sciences and technologies as they are the
primary means of a more convenient life. She would prefer the technology tools
to traditional ways of implementing tasks. In addition, as an introvert and a
customer, the author finds that interacting with humans is sometimes
uncomfortable. Therefore, the idea of having self-services in hospitality industry
might not only offer customers their own space and time but also stimulate
business growth in the field.
The author has some own experiences with AI and self-services. More
specifically, self-order machines at fast food restaurants such as McDonald’s
6
restaurant in Disneyland Paris, France has helped to shorten the waiting time and
provided more individual room for guests to decide their meals during peak hours.
On the contrary, long waiting lines happen quite often throughout rush hours at
McDonald’s in Rovaniemi, Finland where also experiences mass tourism in winter
season. This might due to the fact that no self-order machine is applied to support
the staffs. In addition, the Shabu Shabu restaurant chains in the Netherlands can
be seen as another example of automation where self-order devices are used
directly at the tables instead of the traditional ways. It is undeniable that AI helps
humans with basic work so they could focus on more important things in both
work and life. Thus, understanding the needs of it would benefit enterprises
especially hotels to perform accurate customer services.
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Overall, there are three basic forms of AI which are Narrow AI, General AI and
Super-intelligent AI. Narrow AI is able to do selected tasks and General AI
represents general intelligence of humans. Super-intelligent AI exceeds human
intelligence. Its applications are various in different business platforms. Many AI
applications in daily life are Narrow AI such as Siri, Google Translate and
Chatbots. (Milani, Rahmati, Nurakbarianti & Klitzing 2017, 4; Jajal 2018.) For
instance, the media-services provider and production - Netflix applies machine
learning which is a subdivision of AI (Jaya 2019) to discover up to 80 percent of
the next potential shows or movies for its customers (Plummer 2017; Milani,
Rahmati, Nurakbarianti & Klitzing 2017, 4); and thus, it makes the user
experiences personalized which is one of the factors leading to Netflix’s success
(Gavira 2019).
and Porter Robot that are two of three new concept robots. Serving Robot helps
deliver food and drinks to guests at hotels quickly. The Porter Robot’s tasks are
transferring luggage to rooms, handling fast check-in and -out as well as taking
care of payment. (Hertzfeld 2018.)
Travel has impact on individual’s emotion, intelligence, spirit and physical aspect
as well as creates a feeling of escape and freedom (Gilbert & Abdullah 2004 as
cited in Altinay & Poudel 2015, 12). Travel and tourism industry include the
smaller business group called the hospitality industry delivering services that
meet people’s demand regarding food & beverage, accommodation, recreation,
travel and leisure activities (Chibili 2017, 17). When deciding the choice of hotel,
customers tend to take these following characteristics into consideration:
cleanliness, venue, cost, security, brand reputation and service quality (Marić,
Marinković, Marić & Dimitrovski 2016, 14–15).
Scott (2002) defines that customer service is a series of actions which are
designed to improve the satisfaction of customers (Amoako 2012, 134). People
who make direct purchases and consume a service themselves are described as
consumers. They instantly evaluate the quality of the service and will based on
that to consider further purchase decision. (Williams & Buswell 2003, 26.) Service
is the fundamental exchange of the economy (Vargo & Lusch 2008 as cited in
Altinay & Poudel 2015, 10). Service value is the value in applications regarding
customers’ perspective while according to sellers it is the exchange of value
following the service-dominant logic theory (Vargo & Lusch 2004 as cited in
Altinay & Poudel 2015, 9).
certainly become a universal idea. Customers expect the services to have not
only quality, comfort, personalization and price but also speed. (Bagdan 2013,
14–15.) Self-service is where customers experience the service through
machines and have no interaction with human employees (Williams & Buswell
2003, 90). A service is considered a failure when it fails to meet customer
expectations in regard to the service delivery standard (Ahmad 2002, 19; Cheng,
Shaheen, Gan & Brian 2017, 2).
Another project has shown that approximately one third of European enterprises
have launched AI in customer service and 72% of those are receiving benefits
which include massively reducing agents’ time, effective dealing with high-volume
tasks and offering always-on customer care (Devoteam 2018). In addition, a
survey conducted in 2017 by Deloitte of 250 executives discovered 88 percent of
respondents agreed that AI is important or very important in services and product
offers. An additional survey made by Genpact-sponsored of 300 global
executives found that over 40 percent of them believed that AI enhances
customer experiences. (Davenport 2018, 63.)
Those can conceivably prove the fact that humans cannot physically and mentally
perform at their best all the time, and interaction between customers and
employees cannot be predicted whether it can contribute high value to the service
providers and consumers. Thus, adopting robots with modern technology might
help minimize unfairness and support the hotel’s operation. Moreover, the
potentials of applying AI with different data functions in HRM can be explored in
six selected situations: predicting turnover, searching suitable applicants,
assigning tasks and schedules, analysing HR sentiment, resuming data
acquisition; and staff self-service (Strohmeier & Piazza 2015 as cited in Buzko et
al. 2016, 27).
The main tasks of housekeeping are cleaning hotels’ properties, making beds
and resupplying essential items such as toilet paper, towels (Ward 2018). The
hotel services particularly room services are rated by the good quality which
depends on the employees’ expertise and responsibility. Head housekeepers
should be good psychologists as this department depending on the size of
enterprises is always in need of employees especially seasonal workers. (Batinić
2015.) It is responsible for managers to operate competitiveness quality of guest
rooms as well as for employees to perform excellent cleaning and maintenance
skills in housekeeping as cleanliness is an important role in hotels’ successes.
A waiting line is created when the service demand at the moment surpasses the
available capacity to offer that service (Sridhar 2001, 6). Waiting lines for
receiving services might have harmful impact on the enterprises as well as create
a negative impression about the service providers (Qureshi, Bhatti, Khan &
Zaman 2014, 80). Not only the waiting time affects customer satisfaction, which
is considered as a response instead of an attitude (Oh & Parks 1997 as cited in
Lambert & Lee 2008, 96-97), but also do the customer expectations concerning
services or accusation of the waiting line causes (Taylor 1994 as cited in Qureshi,
Bhatti, Khan & Zaman 2014, 81).
The conversation can be started either by the people or the chatbot depending
on the service provider’s platform and its setting. Users can enter key words in
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chat box and replies will usually come right away. One good example of always-
on customer support is AI Chatbots that have been launched in customer support
through social media such as Finnair Facebook chat box. The Finnair chatbots
on Facebook is currently in experiment stage. It generates most common
questions with key words in the common language English to help international
users get familiar with the chatbot. If they cannot find the information needed,
they can choose to connect with live person through chatbots, which might take
time for processing.
There have been artificial intelligence applications in hotels around the world.
Henn-na Hotels are the world’s first robot-staffed hotels and are located in Japan.
Robots are employed from front office, storage room to check-in and -out services
with voice and facial recognition (Henn-na Hotel 2019). (Revfine 2019.) In
addition to the pioneers of AI service providers, the famous hotel brand Hilton has
been investing and applying mobile app technology for recent years including
digital key for accessing and offering loyalty members the capability of choosing
their own rooms while checking in with the app (Ting 2017).
Saigon which is also known as Ho Chi Minh City plays an important role not only
in the Southern economic center-point area but also in tourism and hospitality
industry of Vietnam (Vietnam National Administration of Tourism 2019). It was
ranked as 13th among 15 fastest-growing tourist destinations in the world
according to Travel Supermarket (Nguyen 2018). From January to August 2019,
the total number of international tourists in Ho Chi Minh City has reached
approximately 11.5 million arrivals which is 8.7% higher than that of the same
period last year (Vietnam National Administration of Tourism 2019).
The total of international tourists from Asia mostly from China and South Korea
accounts for the highest arrivals which are nearly about 9 million followed by
tourists from Europe in which number of Russians occupied the highest number
with about 1.5 million arrivals. Whereas, domestic tourists reached to 80 million
in 2018 which was 9.3% higher compared to that in 2017. (Vietnam National
Administration of Tourism 2019.) As the data has shown, tourism industry of Ho
Chi Minh City has remarkably grown, which creates plentiful opportunities for
service providers to offer competitive and quality services. Nonetheless, tourism
industry in Vietnam has been facing the lack of qualified human resources due to
insufficient or ineffective training, which negatively impacts the industry in general
(Tuoi Tre News 2019).
While Vietnam has been well-known for its picturesque and wild countryside
together with the appealing coastline, pristine beaches and cuisine, Saigon
represents the compound of ancient architecture and modern life of a dynamic
developing country with skyscrapers, infrastructure as well as a restless lifestyle
(see Lonely Planet 2019). Therefore, Ho Chi Minh City would be an ideal place
to experiment modern technology approach which is Artificial Intelligence in order
to serve not only luxury tourism seekers but also to provide more qualified non-
human employees for better experiences. In other words, self-services, automatic
self-machines and other customer support systems with AI technology such as
15
chat bots, robotic helpers would effectively support the businesses in taking care
of customers, dealing with problems and also providing high quality yet personal,
authentic experiences.
This thesis process has started since February 2019 and the choice of the topic
has come up based on the author’s personal interests in hospitality industry,
technology and Artificial Intelligence. Researching related theories and general
information of the study was done and simultaneously finding suitable
commissioner. Commissioner requests were sent to some hotels and lecturers of
universities as they might be interested in the topic. Eventually, commissioner
agreement was signed with Future Technologies and Tourism Services project
as we shared topic’s similarity.
Afterwards, questionnaire was designed and corrected errors with the guidance
of the supervisors. Survey was conducted individually in Ho Chi Minh City in
summer of 2019 and finished before September of 2019 due to challenges in
finding respondents’ acceptance to fill in the questionnaires. Survey results were
analysed with charts and thus finalizing the thesis in fall 2019. Detailed process
can be seen in Table 1 below.
Secondary data were collected and analysed through the sources from online
articles, prior researches, books and other reliable materials. Quantitative
research methodology was used to collect primary data in order to support the
analysis part of the project with numerical statistics. Consequently, the
possibilities of AI approaches in innovating customer services would be
recognized and analysed based on the respondents’ answers.
The target group was mainly young adults, preferably under 25 years old and 25-
24 years old. Young adults from age 18 to 35 are belong to the generation
Millennials who are capable of adapting and learning new sciences and
technologies. Unlike Boomers who were born between 1946 and 1964 accepted
new technologies as necessary working tools, Millennials (1981-1996) see new
technologies as the guarantee and promise of creating better lives (Davis & Silva
2019). Accordingly, the SWOT method was applied to anticipate the potentials,
opportunities and challenges of AI approach in hospitality industry.
Researches about Artificial Intelligence and its approaches are numerous, yet
there are not many resources of that in tourism and hospitality industry. Although
AI is a trendy topic, only researchers and luxury hotels who can afford the
technology are interested in the topic to participate in this project as a
commissioner. Hence, there were difficulties in requesting potential
commissioners but the author managed to find one eventually. Some instances
of existing researches related to the field are: Artificial Intelligence: A Game
Changer in the Hospitality Industry by Mazars (2018) and How Does Artificial
Intelligence Affect the Tourism Industry by Martin Zsarnoczky (2017).
In addition to the challenges while contemplating this research, the original case
study would have taken place in Rovaniemi, Finland with the commissioner’s
support. However, it was difficult to contact the commissioner as well as having
a deeper understanding about their purposes and intentions. As a result, the
target area has been changed to Ho Chi Minh City, Vietnam where tourism
industry is remarkably growing.
18
Furthermore, conducting the survey in Ho Chi Minh City was quite challenging.
The ideal place to conduct survey was at the airport but it was impossible to gain
permission to access the area due to security concern. Nonetheless, thanks to
personal travelling, the author managed to send out some questionnaires inside
the airport. Together with that, some famous tourist destinations were selected to
collect the majority of total respondents despite unpleasant weather in summer
time.
some Asian tourists who were travelling alone or with a small group of friends
and/or families.
Figure 3 illustrates the travelling companions of respondents. More than two fifths
of respondents (43%) travelled with families and/or relatives. Respondents
travelling with friends and/or acquaintances occupied just over a quarter of total
respondents, at 26%. Rest of the participants travelled alone, with partners, on
group tours or in a company trip.
According to Figure 4 below, almost half of the participants stay in hotels two to
four times per year (44%) followed by those who stay in hotels five times or more
21
(34%). Respondents who has not used hotels at all were at 4% of total. Generally,
majority of the respondents in this study spend considerable time in hotels and
using its services. This could show that their responses and thoughts are
considered valuable to the purpose of this research in other to understand their
opinions as well as demands for Artificial Intelligence applies.
approach was not important at all regarding their choices of hotels. This could be
understandable since there are not many appliances of AI in hotels around the
world at the present time in addition to the fact that hotel guests are more familiar
with the traditional way of experiencing services.
Based on the author’s own working experiences and knowledge about hotels in
Vietnam, hotels there are considered to have affordable price ranges for different
groups of guests. Most standard international tourists are able to afford high
ranked hotels in Ho Chi Minh City. The quality of hotels varies depending on their
brands and ratings. In Ho Chi Minh City, 1 – 2-star hotels, hostels or some
inexpensive Airbnb might provide low quality of rooms, services and have lack of
security or hygiene.
How familiar are the respondents with Artificial Intelligence and self-services is
displayed in Figure 7. On the scale 0 – 5, approximately half of the participants
believed that their AI comprehension was at level 3 and 4 (31,7% and 19,2%)
while 12,5% of total was at level 5 of the familiarity. Only 6,7% of respondents
were completely unfamiliar with the concept and its approaches.
in hospitality and tourism industry. There were 21,2% of the respondents who
have never experienced any of AI services listed in the questionnaire. This is not
a massive proportion but somehow it could demonstrate that there is a notable
number of people who might not have any chance to follow the accelerated
technology’s development nor might prefer to use the traditional ways of
experiencing services.
In the questionnaire, respondents were also asked about their opinions on what
would prevent them from staying at a hotel which is applying AI technology.
According to Figure 12, over one third of respondents (35,6%) would prefer to
interact with human employees. 30,8% were afraid they would not have enough
money to afford the stay. Another 30,8% of respondents thought that nothing
would stop them from experience Artificial Intelligence services. Around 20% of
27
respondents believed that robots, self-services might take wrong orders or they
would not know how to use the services.
The gap among the statement balance indicators is relatively large. A majority of
respondents (61,5%) felt extremely positive about statement 2, whereas a small
minority (18,3%) felt slightly positive about statement 4, which makes it the most
negative statement in this case. The positive statements represent the high
agreement level of responses. Most respondents believed Artificial Intelligence is
a trendy and helpful tool to deal with frustrated situation such as in waiting lines
or to increase level of cleanliness and hygiene (statement 5, 2 and 3). On the
other hand, the balance indicator shows that respondents did not positively agree
29
Figure 13. How Positively Respondents Feel About Each Statement (N=104)
During the process of conducting the survey, several respondents thought the
topic was interesting, while some respondents expressed their fear of losing jobs
to AI with a playful attitude. In the optimistic scenario of Artificial Intelligence
approaches, respondents’ positivity level on those statements could be perceived
as business benefits to encourage hospitality organizations to effectively apply AI
and earn profits from it. In spite of disputable assumptions and feelings about
experiencing AI, many other respondents were eager to welcome it. Personally
speaking, everything that is new is controversial and it takes time to be accepted
into the society.
30
Strengths are inner features and characteristics that are the benefits of having AI
technology in hotels. Weaknesses illustrate the disadvantages that might occur
when running AI. Opportunities are external features that AI could contribute to
the hotel’s development. Threats are also external aspects that the hotels need
to be aware of and/or deal with in case of spontaneous incidents. (Parsons 2018.)
5 DISCUSSION
The survey results are significantly intriguing with the total of 104 respondents.
More than half of the respondents were international tourists while the others
were Vietnamese, and most of them found the topic was interesting Some of the
factors that respondents consider to be important are: always-on service, fast
access to service, safety and security, and cleanliness of the property. Moreover,
being in waiting lines seems to be the most frustrated experience for respondents
based on the survey results. Although not all respondents were familiar with the
Artificial Intelligence concept yet, service providers could consider those
important factors as weak signals to improve their services with the help of AI.
Applying Artificial Intelligence in hotels might be challenging due to particular
reasons such as financial capacity and size of hotels; however, it is possible for
small to medium enterprises to start from basic form of AI for example, chatbots
to create always-on customer services and faster responses.
33
Due to both the theories discussed in the thesis and the process of conducting
hand-out survey, undoubtedly Asia has been leading the new technology in
variety of businesses while the European countries are slowly adopting it. More
specifically, China where is the biggest government-invested AI approaches, has
publicized a multibillion-dollar enterprise to lead the AI technology by 2030. Other
leading countries in implementing AI are Singapore, the United Kingdom, Ireland
and Canada. (Davenport 2018, 94–96.) As a result, it might take time for
businesses in travel and hospitality industry around the world to adopt Artificial
Intelligence, which is necessary as the world will continue to grow vigorously with
the development of modern technology and sciences through years. This
transition will be similar to when internet was invented and has become
inseparable from every person daily activity nowadays.
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APPENDICES
Appendix 7. Questionnaire
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Cleaning Robots Self-Service Machines Facial Recognition Chatbots Serving Robots Porter Robots
Extremely interested 21,2 % 26,9 % 26,0 % 16,3 % 19,2 % 18,3 %
Very interested 28,8 % 30,8 % 30,8 % 26,0 % 28,8 % 21,2 %
Appendix 7. Questionnaire
*Required
Background Information
1. Age *
Under 25
25-34
35-44
45-54
55-64
65 or over
2. Gender *
Female
Male
Other
3. Nationality *
Vietnamese
Chinese
Taiwanese
Japanese
Malaysian
Singaporean
Thai
46
South Korean
Australian
European
North American
Other:
4. Travel Companion *
Alone
With family / relatives
With friends / acquaintances
With partner
I am on a group tour
Other:
Location
Accessibility
Modern
technology
47
Cleanliness
Security
Privacy
7. How familiar are you with Artificial Intelligence (AI) and automatic self-
services? *
0 1 2 3 4 5
12. What kind of Artificial Intelligence services would you prefer to have in
hotels in Ho Chi Minh City to enhance your experience? *
Not at all Slightly Somewhat Very Extremely No
interested interested interested interested interested opinion
Cleaning
robots for
49
13. What would stop you from staying at a hotel that is applying AI
technology? *
I'd prefer to interact with human employees
I'd prefer to stay at old traditional hotels
I'd not know how to use it
I'd not have enough money to afford the stay
Nothing would stop me from experiencing AI
It'd feel inconvenient to have interaction with automated machines, robots, etc
Robots, self-services might take the wrong orders from me
Other:
50