Reference no: EM13188268

Early in 1999, hotel managers Simon Andrews and Sybil Jones decided to leave one of the Europe"s largest hotel chains and create their own new chain. With funding from personal investments and venture capitalists, they opened 3-R Hotels (Rest, Relax, & Recreate) in the spring of 2000. They currently operate 14 hotels in 5 countries, each with 100 rooms and approximately 300 staff. The mission of the chain is to differentiate themselves from other lodgings that simply offer a bed: they want to provide an experience to their guests, including elegant meals, relaxing living quarters, and extensive recreational options such as golf, tennis, spas, gyms, night clubs, and excursions to local towns and areas of interest.

At the present time, each of the 14 hotels employs separate management staff, including positions of Hotel Manager, Assistant Manager, and four Directors: Operations & Finance, Guest Services, Restaurants, and Reservations. Centralized positions providing direction and support to all 3-R Hotels include a 5-person Marketing Team led by Vice President Fred Stafford, a 12-person Technology Team led by Vice President Sarah Hawking, and a 3-person Travel & Tourism Team led by Vice President Monica Duval.

All 3-R Hotels use two centralized systems: a Reservation System and a Guest-Services System. The Reservation System: tracks guest reservations accepted up to two years in advance; interfaces with the Guest-Services System to determine non-lodging costs; produces guest bills; processes guest payments. The Guest-Services System: tracks current rates for services within the hotels; manages the schedules for the services including availability; interfaces with the Reservations System to validate guests and to provide billing totals due to Services. Note that for tracking and billing purposes, restaurant and bar charges are tracked within the Guest-Services System.

The centralized Technology team's responsibilities include maintaining the Reservation System, the Guest-Services System, and the 3-R web site. The web site currently displays the names and locations of the hotels. Graphics depicting photographs of sample rooms and restaurants are available, along with brief descriptions of the locales surrounding the hotels. Reservations are not accepted on-line, however, nor can prospective guests query dates and room rates for availability.

Looking to the Web

Fred Stafford, head of the Marketing Team, and Monica Duval, head of the Travel & Tourism Team, do not feel that the site best supports 3-R's mission to provide a complete recreational experience to their guests. They have recommended to the co-presidents, Andrews and Jones, that the web site be enhanced to display more details and perhaps video of the surrounding locales, on-line queries and reservations of rooms, and on-line booking of guest services made in advance of a guest's stay. They feel that a large enhancement project to the site will best meet their strategic objectives to increase revenue by booking to capacity at peak times and by expanding peak seasons by marketing year-round points of interest.

The co-presidents are somewhat hesitant to embark on such a project, especially considering the Technology Team has minimal experience in more sophisticated web technologies.  New technical resources would need to be hired to support these efforts.  The co-presidents also feel that development effort on such an enhancement would detract their employees from providing top service to their guests; the hotel managers agree. Their staff members are already over-worked.

The Marketing Team, though, feels pressure from other larger chains and states that if the site is not enhanced, some of the hotels will have to be closed within two to three years as the capacity rates are declining. Their projections indicate that they have room in their marketing budget to cover approximately $900,000 in project expenditures, and they are willing to set aside other marketing endeavors to launch this project. They are hopeful that a new site can be up and running, accepting online reservations and queries within 10 months before the start of the next peak season.

Andrews and Jones decided to hire a consultant to study the current site and systems and recommend a course of action. Several friends recommended you as a person who has considerable experience with charting project direction.

Preliminary Findings

You conduct a set of preliminary discussions with Andrews and Jones to discuss the various systems and the company's strategic vision. You also meet with the heads of Marketing, Travel & Tourism, and Technology to gather their initial thoughts for the site improvements. In an informal report of preliminary findings, you recommend the launch of a project, beginning of course with the Requirements phase, to enhance the web site to:

1. accept on-line queries for room and service availability
2. accept on-line reservations of rooms and services
3. provide extensive information including virtual tours of the surrounding locales
4. investigate co-marketing opportunities with other travel & tourism vendors in the area.

Although each of these aspects could be developed independently, you recommend analyzing them together because of the significant interaction among them.