Decision Analysis and Modelling

This document is a case study of Cunningham Holdings, a family-run company in the hospitality industry. It discusses the importance of decision analysis and modelling in making crucial business decisions. The report analyzes the available options for the clubhouse of a new golf resort project and provides recommendations for the optimal course of action.

Decision Analysis and Modelling
Case study of Cunningham Holdings
Student Name
Institution

Introduction
The current complex business environment has made the ability to make crucial decision
to be very vital for the survival of the firms. For the companies to evaluate their options and
select the best cause to undertake there is need to have reliable and timely data upon which
decision making can be based on (Pijanowski, 2009). The growth of effective data management
techniques and analysis is hence one of the vital aspects that a business need to develop. The
presence of huge amounts of data from the clients, potential market as well as the industry in
general have made data analysis and management to be a very technical task for several
businesses (Brockmann & Anthony, 2016). The structured and semi-structured data ought to be
transformed in to forms that could be clearly understood by the managers in charge of the of the
daily operations of the firm. As the consumers gain more insight into the industry products and
serviced, they tend to be more sensitive to small changes and often a slight deviation by firm
from their expectations may lead to drop in abusiveness brand name.
The Cunningham holdings is a family run company that is operating in the hospitality
industry. One of the key strategic plans of the firm is to adhere to its mission that fronts
sustainability as a long-term target of the firm. Th company is also focused on establishing the
local economy of the rural areas while at the same time striving to develop their business brand.
Currently the form plans to invest in construction of an interventional golf resort. Based on the
managers plan the project is to be constructed at a cost of $ 20 million with a clubhouse included
in it.
As the senior business analyst of Cunningham holdings, I was asked by the CEO of the
company to analyse the available options for the clubhouse and give suggestions regarding the
best course of action to take. This report is therefore meant to document the findings made upon
undertaking data analysis and thereafter give a recommendation on the optimal course of action.
Description of the models implemented
Based on the recent survey on golfer’s the various typed of the golfing holes have been
identified and the enjoyment derived from them by the golfers noted. Furthermore, the company
research team did conduct a preliminary research that gave the land size and the construction
cost of each of the golf holes. An international golf resort has to meet certain minimum

requirements. These features are what formed the constraint of the project to be developed in
addition to the resource limitation of the firm. Using the available information, I did implement
five models to highlight the various options available to the firm and evaluate their impact on the
company finances as well as the enjoyment they will yield to the potential clients of the
company.
Feasible models
Out of the 5 models that were developed as indicated by the above tables, the managers
request of an exclusive clubhouse to be included in the golf resort project was observed to be
unattainable. This was due to the capital constraint that limited the total cost of the project to $
20 million. The firm could thus not afford to develop an international golf resort while at the
same time financing the construction of the exclusive clubhouse. The models that meet the
requirements of the firm while at the same time being attainable to the firm were 3, i.e. the
standard clubhouse model and 2 options to the exclusive clubhouse model (option 2 and 3). The
report will thus concentrate on the features and the impacts of the feasible models.
The standard clubhouse model. The model entails constructing golf holes configuration
as displayed by the table below.
Kind of golfing
hole
Number of
holes
Straight Par 5 1
Dogleg Par 5 1
Straight Par 4 2
Dogleg Par 4 10
Long Par 3 1
Short Par 3 3
By developing the hole configuration as displayed above the model is able to meet all the
features of an international golf resort. Inside the resort will be a standard clubhouse. In total the
project will be implemented at a cost of $ 19.05 million and will need a land area of 40.75
hectares. In return, the total enjoyment index that the golfers will derive from the project will be
35. The managers plan thus is in line with the business objective of constructing an international

clubhouse using the capital that was allocated to the project by the managers. The project is thus
a viable plan.
Exclusive clubhouse model option 1. The primary suggestion by the shareholders cannot
be implemented by the firm given the limited capital that has been allocated to the project. It is
thus necessary to come up with other alternate options that can assist improve the managers plan
so as to make it more acceptable to the shareholders. This model did not give an optimal solution
and can thus be classified as not economically viable to the firm. It should therefore not be of
interest to the managers during decision making.
Exclusive clubhouse option 2. Under this option the moderation made to the primary
shareholders request is the reduction of the construction cost of the clubhouse from the initial
value of $ 6 million to $ 5.1 million. With these new conditions implementing the model will
entail constructing the golf holes as described in the table below.
Kind of golfing
hole
Number of
holes
Straight Par 5 2
Dogleg Par 5 1
Straight Par 4 7
Dogleg Par 4 4
Long Par 3 1
Short Par 3 3
This model will need a total of $ 20 million and an area of 40.75 hectares to implement.
In return the total enjoyment index that the consumers will derive from the project will be 36.5.
Being that the model can be achieved using the available resources of the company makes it a
viable option for the managers.
The exclusive clubhouse model option 3. In this option, the initial request by the
shareholders ought to be upheld, however in order for the firm to e able to implement it the total
capital allocated to the golf resort project need to be raised from $ 20 million to $ 21 million.
This will enable the firm to construct 1 straight par 5 golf hole, 1 straight dogleg par 5, 6 straight

par 4, 6 dogleg par 4, 1 long par 3 as well as 3 short ar 3. In addition, the company will also
construct an exclusive clubhouse at a cost of $ 6 million. All this will generate a total enjoyment
index of 37. The project will consume a total of $ 20.95 million and a total land space of 40.75
hectares.
Model implication
The first model that was developed is the standard clubhouse model, this model is in line
with the managers plan but does not meet the features described by the shareholders. The land
area is just 2 hectares which is smaller than the 4 hectares suggested. Only two models are in line
with the shareholders request, that is the option 2 and 3. Under option 2 the cost of the clubhouse
need to be reduced with the land space covered remaining the same. Option 3 is a perfect fit for
the shareholders request only that the company will have to allocate more finds to support its
implementation.
Recommendation
Looking at the 3 feasible models, there are two potential options that need to be
considered that is the option 2 and 3 of the exclusive clubhouse models. Since the shareholders
are the investors of the business, the managers should allow their request for the construction of
the excusive clubhouse. This should be done by raising an additional $ 1 million needed to put
the model in practice. By sticking to option 3, the firm will be able to develop an appropriate golf
hole configuration for an international golf resort while at the same time optimising the
shareholders enjoyment at 37.

References
Brockmann, E. N. & Anthony, W. P., 2016. Tacit knowledge and strategic decision making. Group &
Organization Management, 27(4), p. 436–455.
Pijanowski, J., 2009. The role of learning theory in building effective college ethics curricula. Journal of
College and Character, 10 (3), p. 1–13.