Melissa O’Brien — HFS Research[00:21]
Hi there. Good morning. Good afternoon. Thank you for joining this HFS videocast. I am joined today by Hemal Shah, Global Head of Travel, Transportation, Hospitality and Logistics at Sutherland. Hemal, thank you for joining us.
Hemal Shah — Global Head of Travel, Transportation, Hospitality and Logistics, Sutherland[00:21]
Thank you, Melissa. Thanks for having me.
Melissa O’Brien — HFS Research[00:39]
So our discussion today is going to be about the travel, transportation, hospitality and logistics ecosystem, and what the future looks like for these industries. At HFS Research, we’ve recently done a Horizon study, which is our vendor and partner assessment of service providers in any given industry, to understand the dynamics and what the needs are from the enterprise as well as what the service providers are offering and how they’re helping their clients. Sutherland participated in this report and landed in our Horizon 3, which is a great ecosystem value proposition for any service provider. So today we wanted to talk through a few of the dynamics, in particular around that ecosystem. Hemal, I just wanted to get your thoughts on how the ecosystem is working with technology service providers and with regulatory bodies, and how that’s working to help your clients in these industries and how that’s a differentiator.
Hemal Shah — Global Head of Travel, Transportation, Hospitality and Logistics, Sutherland[01:41]
No, thank you. Thanks, Melissa. At Sutherland, we are very proud to be recognized as Horizon 3. We’ve worked over the last couple of decades or so in building the domain expertise, but more so at scale, for our THL industry capabilities. That’s one that helps us deliver value to the ecosystem. What we’ve also done is bring in the IP investment, building our own platform so that we are able to provide the business process as a service solution to our ecosystem partners, whether it is in the hospitality, logistics, or travel segment. What we are seeing as a value—and as Sutherland, we can’t invest and build the IPs ourselves, but working with the industry players, working with industry bodies, allows us to stay ahead in terms of the curve and be able to provide value to our partners. What we’re also working very diligently towards is allowing and helping our partners utilize data to drive business outcomes. I think these are also some of the values HFS sees in rating the partners or the participants in the Horizon 3. And we’re fairly proud that we’ve been able to bring some of these to the ecosystem.
Melissa O’Brien — HFS Research[03:38]
Excellent. Yeah, that’s actually one of the big differentiators of our Horizons methodology—that we’re not just briefing with service providers, we’re actually getting into voice of customer and understanding what their needs are and getting their feedback and input, and even going a step further, we’re talking to those partners as well and getting the understanding of how you’re bringing together data to help your clients advance. So, well done there. And I also wanted to touch upon what’s next. As we affectionately call these industries THL, what’s going to be the sort of big game changer in the next year? We’re hearing a lot about Gen AI—that’s the topic and hype of the day—but there are some very real implications that we see happening. So we’d just love you to gaze into your crystal ball for a minute and let us know what you’re thinking about the future of these industries.
Hemal Shah — Global Head of Travel, Transportation, Hospitality and Logistics, Sutherland[04:32]
No, absolutely. I think Gen AI is real. It is making a great impact in the industry. If I were to look at THL as an industry today, we’re seeing that more and more of the companies in this space want to become the Amazons of the world, if you will. They want to be able to sell more to their customers. Besides having that greater wallet share, they want to make it easier for customers to buy everything that they may need within their entire journey with the brand. If you take an example of airlines, airline distribution is moving towards becoming like a modern retailer. Low-cost carriers had already begun the trend of ancillaries being a predominant component of air travel. But now even the scheduled carriers or traditional carriers want to break down the fare, sell everything around the travel—like ground transportation, stay options, experiences, insurances—as a single order, and service it like a primary owner of that order. So that’s one change that we are seeing in the industry. The competition to the traditional industry players from shared-economy companies is forcing them to innovate faster than what they have ever done. If you look at Airbnb’s disruption to traditional hospitality companies, or the likes of Flexport challenging the business models of traditional freight forwarders like UPS and FedEx, they’re making traditional businesses think of ease of doing business and delivering a better customer experience. We’re seeing that more and more clients want to focus on their core business, platform-related systems, and look for technology, people, processes with deeper integration and innovative commercial models that are getting explored in the industry, and that’s where we are having a lot of those conversations with potential clients of ours. Lastly, to your point on Gen AI—and I would say broader AI as well as Gen AI—they’re driving solutions that help these companies run their business in a much better way. If you look at the travel industry, it has always been at the forefront of technology innovation, be it the airline industry being the first marketplace with GDS technology in the 70s, or the hospitality industry introducing revenue management to the world. We believe that the THL industry will be a fast mover at an enterprise scale to adopt Gen AI as a solution. In fact, we wrote an extensive white paper on the level of impact Gen AI will have within each function within the industry. We believe that Gen AI will change the way brands interact with their customers. It’ll change the way brands make decisions about the business moving forward, and it definitely is going to be disruptive to the industry players like ourselves who are providing solutions to the industry.
Melissa O’Brien — HFS Research[08:17]
Great. Yeah, it’s an exciting time. So it seems like the sort of coming together of a lot of different things. There’s the changing customer expectations. There’s the competition and new business models, and then technology impacts, and these are all overlapping and sort of helping evolve and change the industry. Excellent. A lot of work ahead, I’m sure, for you and your clients, but thank you so much for sharing your insights today, and thanks to our HFS audience for joining us on the videocast.
Hemal Shah — Global Head of Travel, Transportation, Hospitality and Logistics, Sutherland[08:42]
Thank you so much for having me, Melissa.
