Outrigger Case Study

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Executive Summary

The ‘Outrigger Hotels and Resorts’ was founded in 1967 with an idea of making the middleman’s dream to paradise a reality. By 2004, this firm had grown to 3600 employees, a wide portfolio of properties in various international locations, and revenues of approximately US 45 million dollars.

Some of its key assets which the firm leveraged on were: Premier locations in the markets, strong name and recognition, relationship with the travel distribution network, focus on vacation destinations, local knowledge and community ties and good employee relations. IT had provided Outrigger a very big edge over its competitors. The highly developed nature of its IT department, their understanding of the business needs and the market made Outrigger ahead of the game with its competitors. The centralized ERP system, integrated PMS/CRS, electronic interfaces with distribution partners, data mining and business intelligence support was serving them well. With its aggressively growing size, a key challenge Outrigger was facing was to keep its IT centralized. They had employed several options but were still looking for a resolution to this issue. The hospitality distribution network was also changing and Outrigger had to gear up to the challenge it was posing in terms of more and more information being available on the internet. People were now going to the internet for information about their travel instead of the travel consultants. Outrigger’s IS hand had to set up a vision and strategy to make use of the changing environment and convert it into an advantage.

I. Contents
Current Situation of the Outrigger Business2
Threats and Challenges3
IT Strengths3
IT weaknesses3
It Threats4
Critical Success Factors4

Current Situation of the Outrigger Business

Niche/strategic positioning of brand – leisure travel segment Community ties
Wide portfolio to suit pockets of budget as well as luxury traveler Wide geographical presence to cache on the customer’s experience in one location Business and IT understand each other and want to move hand in hand Location of Hawaii

Customer loyalty to the brand (25% return)
Centralized structure
Dealing with property owners for management of condos
Decentralization with expansion to international locations
Customer trend to island hop
Cross property traffic
Threats and Challenges
Bigger brands in the Hawaii market
Wedded to success of its destination markets
Airlines which serve these markets

Critical Success Factors

In my opinion, the following are the critical success factors for Outrigger Enhance presence on the internet

The hospitality distribution environment today is largely dependent on the internet. The customer wants to shop around before deciding to pay for any product. With the availability of wifi in home, at roads and in Macdonald’s joints, the customer wants to ensure he has seen all his options before making a decision. The changing economy of the world has also impacted the way people spend their money. A honeymoon couple might want a vacation at Hawaii but wants to ensure they get the best for their money. They prefer seeing the information first hand rather than visiting a travel agent. There is a new generation of leisure travelers, who want to travel on a budget, but also want to experience the most a place has to offer. So they might want to stay on a Beach resort the first day for experience and move to a cheaper accommodation the next day. Such flexibility and wanting a holiday exactly suited to your needs make internet a preference over travel agents for booking. With this changing environment, Outrigger needs to enhance its presence on the internet. The presence can be build by tying up their wide portfolio of options with travel websites like expedia.com and hotels.com which people use to plan their...
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