The AI ‘algorithmic audit’ could be coming to hotel room checkout
Artificial intelligence has the potential to bring unexpected changes to various industries, even in areas where issues were previously thought to be resolved. The utilization of AI by Hertz (as well as European car rental company Sixt) to detect damage on cars and then charge customers is a novel application of technology that is slowly seeping into consumer life without much notice. This is just the beginning of unforeseen adjustments to the travel experience that AI is expected to bring.
Experts predict that businesses in the service industry will increasingly adopt similar technology in the future, if they haven’t already started. Shannon McKeen, a professor at Wake Forest University School of Business, refers to this trend as ‘algorithmic auditing,’ where AI is used to identify, categorize, and monetize inefficiencies or losses that were previously overlooked.
The implementation of these systems raises questions about the balance between operational efficiency and customer satisfaction. It’s not just about whether AI can detect minor imperfections, but also about whether businesses should charge customers for every tiny flaw that algorithms can identify but humans might consider normal wear and tear.
The conversation between service agents and customers regarding costs will now include a new element: “the machine says.”
Exploring AI in the Hotel Industry
Hotels are also starting to adapt to these changes, with some experimenting with AI in various operations. While not all hotels have automated billing processes like Hertz, many are using AI-powered sensors to monitor air quality and enforce fines for smoking in rooms. However, there are concerns about false positives triggering unwarranted charges.
Unlike car rentals, most hotels have not fully automated the billing process yet. AI is primarily being used to flag potential issues, such as unusual odors or maintenance problems, with human intervention still required for the final decision.
However, the trend in the hotel industry is moving towards more advanced AI applications that can detect damage or analyze guest behavior in real-time.
Balancing Automation and Customer Experience
While AI offers significant opportunities for businesses to improve efficiency and recoup costs, there is a delicate balance between customer trust and AI implementation. Companies must prioritize transparency and ensure that AI is used as a supportive tool rather than a punitive measure.
Chuck Reynolds from L.E.K Consulting emphasizes the importance of customer-centricity in AI implementation. Organizations need to design AI experiences with empathy and involve humans in the decision-making process to maintain customer trust.
As AI technology continues to evolve, customers can expect to encounter similar applications like those used by Hertz in various industries, such as restaurants itemizing plates for accurate billing. The focus is on enhancing operational efficiency and guest satisfaction rather than penalizing customers.
While some view this trend as excessive use of AI capabilities, others see it as a necessary evolution in improving service quality and efficiency in the hospitality industry.
