Posted: May 25th, 2022
Outrigger is a resort/hospitality firm that started in Waikiki. Most of its properties are located in Hawaii but the company has a number of international properties as well. Outrigger has a mix of properties. Using Porter’s typology, some Outrigger properties compete as cost leaders while others have a differentiated strategy. This creates confusion for customers, despite different branding for the different segments. The company also has a number of condominium properties. The company competes against major hotel/resort operators, and as such needs to have a strong brand. There is considerable brand loyalty in the Hawaii market, so all firms in the industry need to spend on marketing to attract business in the first place.
The current IS resources are insufficient for Outrigger’s needs. One problem is that while Hawaii reservations are centralized, customers must contact individual resorts elsewhere for booking. This effectively squanders the Outrigger brand equity, and creates a barrier between purchase desire and purchase. The decentralization does not serve its needs well, especially since all major competitors have centralized control and booking, something that ensure consistency of customer experience and creates a norm for the industry that Outrigger’s antiquated system cannot match.
3. At present, information systems provide some booking support, but not for all hotels. There is an 800 number that is manually switched to the right hotel. It is 2005 and I am not reading anything in the case about the Internet. There is no integration between the POS systems and Stellex, making it difficult for customers to pay at on-site stores and restaurants on their room. The links in the reservation system are terrible, with no attempt to keep them in sync. The company outsources the website, taking it out of its control, despite the size of the company. In general, the IS at Outrigger seems cobbled together, without much thought as to how the different pieces can and should be integrated, nor how these pieces should support the organization’s strategic objectives.
4. IS at Outrigger needs to support the company’s strategic objectives. The marketing aspect is probably the most important, because right now the outward face to the customers is archaic. The company needs a much higher degree of integration in order to be attractive to customers. In addition, the company does not seem to have a high degree of integration at the managerial level. Outrigger needs to deliver much more information to the company’s managers than it currently is able to do. The level of support for both marketing and operations needs to be higher. Additionally, the company needs to utilize IS to enhance the customer experience wherever possible.
5. I propose the following strategic initiatives. Outrigger needs to develop a fully integrated reservation system for the entire company, and integrate that not only with the website but with travel aggregators online as well. Outrigger needs management information systems, so the people running company has some numbers in front of them to work with. Right now, management is operating almost with 1980s technology. All these legacy systems need to be replaced with a single platform, to enhance integration and to support the MIS. Lastly, anything that affects customers — like the POS to Stellex issue — needs to be addressed. Any customer under 50 is going to want modern technology and will look unfavorably on a hotel that is clueless about the modern world — and some of the things Outrigger is doing will convey cluelessness.
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