Best Western Outsources IT

Best Western International has signed three-year pacts with Keane and TeleTech Services to, respectively, augment operations systems and manage its data center, network and corporate help desk. The moves aim to improve efficiencies of scale and reflect the steady growth of online booking at the expense of call centers.

They will lead to closing the chain's two domestic call centers and layoffs of 300 full-time and 80 part-time employees, says Mike Kistner, CIO of the hotel membership association.

“We are focusing on re-engineering our processes and our skill sets,” he says. Best Western will retain “what I consider the intellectual property and the thought leadership.”

The Keane arrangement will focus on “raw programming skills” targeting web-based technology, Kistner says. “Based on analysis that we've done, after we get these new processes in place we're going to effectively double the number of hours we have available to enhance our system.” In addition to staff reduction, “we're going to save in excess of 20 percent of our development budget and effectively double the number of development dollars available.”

Best Western also is in final negotiations with two vendors for computer operations, hardware, computer operation, and database administration. “We found that it was motivating for the two finalists to be in due diligence at the same time,” Kistner says.

The shift to TeleTech reflects a move away from “a peak and valley model” in which Best Western has to over-buy technology to meet peak demand. The flag is moving toward a model in which it purchases “the capacity you need when you need it, and when your demand decreases, you don't pay for those resources,” he says. “We want to achieve additional capacity, increased stability and increased availability at a reduced cost. You can do that when you partner with someone who has the economies of scale.”

The moves reflect the increase of online booking. “Our call center volume went from about 11 million calls a year five years ago to less than 5 million at the current state,” he says. Meanwhile, electronic booking, including Internet, GDS and brand.com, has been “phenomenal.”

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