The Development of IT: Canyon Ranch Health Resorts - Case Study Example

Case Study 3 Introduction Canyon Ranch Health Resorts was initiated by Enid and Mel Zuckerman for the people of America to relax and get motivated to lead a healthy lifestyle in the year 1979. The company was exhibiting a growing trend in the market and experiencing appreciation for its work by the people of the United States of America. Due to the advent of many more resorts providing spa, the company in 2004 started facing pressure as a result of the growing competition. The lack of market competition and the economy of the US assisted the company to enjoy success in the earlier period. Due to the increase in the market pressure, the company focussed on its information technology (IT) department to provide information regarding the changing trend of the customers and increase the cross selling of the offerings. The key problem associated with the company is related to the use of different IT applications. The lack of importance towards customer relationship management (CRM) and IT system was the major factor which was critically affecting the company. Canyon Ranch had a conventional approach towards the use of information systems to ensure business effectiveness. Computerized Lodging Systems (CLS) was implemented in the company to keep a track of the customers. In order to monitor the customer preferences, Guestware software application was implemented. Correspondingly, the issue faced was that no proper integration was being established between the CLS and the Guestware. Moreover, the person who acts as a coordinator in the company was not being able to provide relevant information on time and also did not have information related to the business ahead of time. Also, the firm did not have any Point of Sale (POS) in any of the restaurants and salons for the purchase of the goods. The key motive of the Canyon Ranch has been to increase the footfall and the level of customer satisfaction through efficient service deliverance. Therefore, the company needs to incorporate a management strategy to increase the customer relations effectively. The company through the development of IT would be able to enhance the service deliverance and tracking (Applegate & Piccoli, 2004). Summary of Facts The company Canyon Ranch is renowned in the industry as gold standard and thus commanded a service rate of 25% to 30% greater than the other destination spas. The unique value proposition of providing health and healing in Canyon Ranch which was supporting its increased market presence, was being followed by other spas. The day spa was taking into consideration the features of providing the medical professional spa and other services such as physical therapy and nutrition. The problem which was being faced by the company was lack in the effective use of the IT technology which is an important aspect for the success and expansion of the business. The IT system which acts as a proper support system was not properly integrated. One of the key problems for the business was a lack of connectivity due to ineffective use of technology which was limiting the guest number. The aim of the business is to attract new customers wherein the use of new advanced technologies can be a major support. Besides, the other basic problems included a lack of information provided to the coordinator by the management due to a lack of use of required IT applications. The unorganised and decentralised infrastructure of IT was another major issue faced by the concern. POS was not practiced in the business which was affecting the management to keep a track of the sales of the goods provided for the spa. Another key issue was the use of decentralised structure of IT for Canyon Ranch business related to the restaurant and spa. The lack of coordination amid the employees was another reason which was creating a barrier for the expansion of the business. The employment of well-trained employees and recruitment of proper staff were the other important issues which were faced by Canyon Ranch. In addition, the benefits which were provided only by Canyon Ranch were now being provided by other close competitors as well. Maintenance of the different departments such as restaurant and salon was becoming as issue due to a lack of information generated through the use of IT and management organisational structure. Also, the overconfidence of the senior management personnel was a key issue which was making them reluctant towards using advanced technologies. A lack of Customer Relationship Management (CRM) was a key constraint for the organisational success. Knowledge management is another area which needs improvement to ascertain proper coordination among the management, employees and the customers. Knowledge management with regard to CRM is also an important concept which if implemented with the proper information technology will lead to greater success (American Hotel & Lodging Association, 2008). Moreover, the vision of the organisation is to expand its business through the incorporation of certain unique features and innovative programs to get recognition throughout the world. This will be possible with the increase in the management system and the IT operations within the business organisation (Canyon Ranch Hotel & Spa in Miami Beach, 2014). Problem and Alternatives The major problem which was affecting the growth and achievement of the business were a lack of proper use of information technology and knowledge management. Knowledge management is a procedure which enables to share and develop the organisational knowledge. It is used in every aspect such as in IT segment, human resources and also in the sphere of marketing. It is an ever-changing and important concept which can be used to resolve the issues faced by Canyon Ranch which it is facing (Bhojaraju, 2005). Based on the problem, there can be three major ways to mitigate the issues to increase the degree of capability to provide proper care and knowledge sharing. The alternatives can be the use of Property Management System (PMS) which is software used in hospitality industry based segments. It is a computer based system which would be effective in keeping a track of customer entry, billing and reservation and can be termed to be much better than the current CLS software used by the business. PMS integrates well with the Guestware software application and would help to increase the POS. The drawback of the local PMS is the requirement of intricate and expensive hardware. The installation time taken is more than other software (WebRezPro, 2012). Another alternative for the business to be successful and effective is to replace the static web system used by Canyon Ranch into a dynamic interactive web system which would assist the customers to make their queries through the use of web. Moreover, they will be able to provide their valuable feedback which is an important aspect for the hospitability sector. People will be able to make online booking and get the details regarding the spa facilities. The website implemented would also support the click technology to ensure an effective monitoring of the profile of the various customers who will be visiting Canyon Ranch (Center for Technology in Government, 2003). The dynamic web can create, retrieve and update the data which is its useful feature. The disadvantage that the dynamic web has is that it is quite expensive than the static web (Cohan, n.d.). Also, the creation of a comprehensive CRM is an important factor which will help to attract the potential customers which in turn would benefit the marketing department in strategizing their policies. The comprehensive approach towards CRM would help in increasing the level of customer satisfaction and thereby loyalty of the customers towards the business would augment as well. All these additional features of IT will help to attract more customers and develop the sales and the service. The disadvantage of CRM is primarily related to cost and time required in training the employees (Heczkova & Stoklasa, 2011). Decision and Conclusion The various alternatives as suggested previously would be useful for the success of the business. The business has various strengths over the other competitors in the market such as its recognition in the market a gold standard company. The feature of providing health benefits with healing alternatives is in the unique selling proposition of Canyon Ranch. The business has various setups in different locations which act as a positive aspect. In order to utilise the key strengths of the business, the PMS software as suggested should be implemented as early possible. This is a web system which would increase the effectiveness of the IT system and also help in collecting the data of the customer along with keeping a proper track of the business. Prudent features associated with billing, online reservation, proper information deliverance and increased coordination are the main factors that PMS would bring in. The decision to use PMS is justifiable as it helps in coordinating operational functions as well as sales and marketing. The other facilities of PMS include guest details, POS, accounts maintenance, material management and other support for the business. This PMS acts as a software model and enables to substantiate the control rate availability without increasing the expenses of infrastructure cost. This system is easy to use and has simple configuration which makes it handy to use (WebRezPro, 2012). The PMS application is majorly used by the front office people as they are the first point of contact for the customers. The front office employees through this web system will be updated with the information beforehand. This will help the coordinator while dealing with reservation requests, registration, evaluation of the room status, posting, call accounting along with checkouts done by the customers (IHM PUSA, 2008; CMS Hospitality, n.d.). Thus, this alternative would help in proper maintenance of the flow of information within the organisation. Canyon Ranch is one of the undisputed leaders in the field of the spa industry. The key objective of the business i.e. to expand and to ensure customer satisfaction can be achieved by implementing proper IT applications and knowledge management concept. The company has several strengths which will be enhanced through the use of suggested alternatives such as PMS, CRM technique and dynamic web design. These features will enable the business to achieve desired success in the future. An incorporation of proper procedures with discipline will help in creating a loyal customer base and also increase the word-of-mouth promotion of Canyon Ranch. The brand image of the company will be enhanced which will in turn facilitate to ascertain prosperity of Canyon Ranch in the long run. Canyon Ranch will be able to ensure a decisive competitive advantage as the use of information systems has attained utmost priority for the modern enterprises to ensure sustainable growth (Applegate & Piccoli, 2004). References American Hotel & Lodging Association. (2008). An Introduction To Hotel Systems. Uploaded Files, 1-29. Applegate, L.M. & Piccoli, G. (2004). Canyon Ranch. Case 1-3 Canyon Ranch, 156-174. Bhojaraju, G. (2005). Knowledge Management: Why Do We Need It For Corporates. Malaysian Journal of Library & Information Science, 10 (2), 37-50. Canyon Ranch Hotel & Spa in Miami Beach. (2014). Canyon Ranch. Retrieved from http://www.canyonranch.com/miamibeach/plan-your-stay/guide-to-services Center for Technology in Government. (2003). Return on Investment in Information Technology: A Guide for Managers. Guide, 1-5. Cohan, S. (n.d.). Static and Dynamic Websites. Static and Dynamic Website Design, 1-17. CMS Hospitality. (n.d.). Property Management System. Portals, 1-4. Heczkova, M. & Stoklasa, M. (2011). Customer Relationship Management – Theory And Principles. Abstract, 80- 91. IHM PUSA. (2008). Computer Application In Front Office. Computer Application, 1-9. WebRezPro. (2012). Choosing the Right PMS Local versus Cloud Property Management Systems. White Paper, 2-12. Read More