Case Study: Business Development Analysis of Aman Resorts

This case study examines Aman Resorts, a luxury hotel and resort group, delving into its business challenges and proposing strategic solutions. The study begins with an introduction to the hospitality industry and Aman Resorts' background, highlighting the intense competition and evolving customer demands. It identifies key research problems related to business management, financial analysis, and marketing. The analysis includes a SWOT analysis, the Four Ps of Marketing, Ansoff Growth Matrix, Porter's Five Forces, and Blue Ocean Strategy to understand the company's position and potential growth strategies. The study then proposes solutions, recommendations, and an action plan, considering resource constraints and limitations. The case study also involves analyzing specific problems using various models, concepts, and theories, providing a comprehensive assessment of Aman Resorts' challenges and opportunities. The findings and recommendations aim to enhance the resort's profitability and sustainability in the competitive market.

Case Study

TABLE OF CONTENTS
Chapter 1: Introduction.........................................................................................................................
1.1 Introduction............................................................................................................................1
1.2 Background of the study........................................................................................................1
1.3 Research problem..................................................................................................................4
Chapter 2: Case Brief...........................................................................................................................
2.1 Introduction............................................................................................................................6
2.2 Research aim..........................................................................................................................7
2.3 Researcher objective..............................................................................................................7
2.4 Research questions.................................................................................................................7
2.5 Structure of the case study.....................................................................................................7
Chapter 3: Plan of Analysis..................................................................................................................
3.1 Statement of the problem of the case.....................................................................................9
3.2 Literature review....................................................................................................................9
3.3 Proposed Plan for Analysis..................................................................................................16
3.4 Marketing tools....................................................................................................................16
3.5 Strategic management and tools..........................................................................................17
3.6 Source of data......................................................................................................................18
Chapter 4: Analysis and Findings.......................................................................................................
4.1 Introduction..........................................................................................................................19
4.2 Marketing.............................................................................................................................19
4.2.1 SWOT Analysis................................................................................................................19
4.2.2 Four P’s of Marketing.......................................................................................................21
4.3 Strategic Management.........................................................................................................23

4.3.1 Ansoff Growth Matrix......................................................................................................23
4.3.2 Porter’s Five Forces..........................................................................................................25
4.3.3 Blue Ocean Strategy.........................................................................................................27
CHAPTER 5: PROPOSED SOLUTION OF THE BUSINESS PROBLEM.....................................
5.1 Assessment of Analysis.......................................................................................................29
5.2 Best fit solution to the problem............................................................................................30
5.3 Recommendations................................................................................................................30
5.5 Resource availability and constraints..................................................................................31
5.6 Proposed Action plan...........................................................................................................32
5.7 Limitations...........................................................................................................................33
5.8 Scope for the further research..............................................................................................33
Chapter 6............................................................................................................................................
6.1 Choose a firm.......................................................................................................................34
6.2 Analyse three problems- subject wise.................................................................................34
6.3 Using three models, concepts and theories..........................................................................35
6.4 Analysis of models, findings, solutions and recommendation............................................37
Reflective statement...........................................................................................................................
References..........................................................................................................................................

LIST OF FIGURES
Figure 1: Subject and Tools for Case............................................................................................16
Figure 1: Ansoff Growth Matrix....................................................................................................24

CHAPTER 1: INTRODUCTION
1.1 Introduction
In the present scenario, hospitality industry has emerged as one of the leading and most
potential industry of the world. The industry consists of different restaurants, hotels, resorts, tour
operators etc. Along with high growth rate, the businesses operating in this industry also faces
intense level of competition (Aras and Crowther, 2012). Each and every market player is trying
very hard to gain high market share and customer base. As per the view of Bradshaw and
Urquhart, (2015), in recent years the demand of international resorts among people in market has
increased to a great extent. Further, these are the businesses which provides different range of
services to their guest. This includes food, accommodation, swimming pool, bar, restaurant etc.
Nowadays, resorts are trying to provide complete very hard to enhance the overall experience of
their guests. Due to the hectic work scheduled, people seeks for places which are located far
from populated areas and traffic (Bellgran and Safsten, 2009). They seek for such kind of place
where they can go out with their friends, family and can relax. Such kind of demand has resulted
in increasing the growth and development opportunities for all resorts.
However, it can be argued that it is not easy for such kind of businesses to operate easily
in highly competitive market. In order to attract customers and gain higher profits, it is required
by these businesses to be highly innovative and creative (Chernev, 2014). In addition to this, they
also need to become aware about the changing need, demand, taste and preferences of people in
market. On the basis of identified customer demand, resorts need to make changes in their
existing services and products. Therefore, it can be stated that at the time of carrying out their
operations businesses such as resorts are required to deal with different types of problems and
challenges (Foxall, 2014). Along with this, in order to sustain in market, resorts are need to
identify and implement the ways through which they can overcome their problems or challenges.
1.2 Background of the study
The provided case scenario is of Aman resorts which a luxury group of hotels and resorts
which is operating in 14 different countries of the world. Further it was founded in the year 1988
by Adrian Zecha and the first resort was opened in Phuket, Thailand. As per the provided case,
Aman Resorts is having total twenty-four properties and all are characteristic by outstanding
facilities, world class services along with beautiful location (Hitt, Ireland and Hoskisson, 2012).
Going through the history of Aman Resorts, it has been observed by the researcher that its
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founder, Zecha has spent very privileged childhood. In addition to this, he has also worked as a
journalist in time Magazine and United Press International. In the year 1970s, he started looking
for new line of business and established one of the most luxurious group of hotels in Asia which
was Regent International Hotels. Later Zecha sold his stake in the hotel and seek for property
where he could build holiday home (Lewis Reynolds, P. and Lancaster, 2007).
It can be stated at the time of developing each property of Aman Resorts, Zecha has
ensured to build a property in which he would love to live. It was the combined efforts of Zecha
and Edwards Tuttle (Paris based Amercian Architect) which resulted in development of
unconventional Aman resorts. Another interesting fact about the resort is that it has used local
material which are simple and durable (Motohashi, 2015). This has resulted in lowering down its
overall cost and has also provided support to local community.
In the present scenario, when businesses keeps profitability on their first priority, Aman
Resorts tried something new and looked forward for developing nearby communities of resort.
On the other side of this, it can be argued that there was a time when the revenue of Aman
Resorts was considered to be highest or among the highest in the entire industry (Olson, Slater
and Hult, 2005). All the properties which has been developed by the resort are based on three
main philosophies which are family, peace and uniqueness. By looking at the location of every
resort, it can be stated that all are located in remote areas which are far from traffic and
population. This helps in developing a feeling of relaxation and satisfaction among all resort
guests. The resort can be also termed as unique because it has incorporated itself from things or
deigns which highlights local culture (Roger, 2010). On the other hand, its philosophy of family
reflects the fact that the resort seeks for providing a rich and home like environment to all its
guests.
The development of resorts also relies heavily on the kind of experience, its owners are
looking forward for providing its guest. Zecha has been always particular or specific about the
design and development of all properties of Aman resorts. This can be justified by the fact that
the rooms in one of its property, Amankora (Bhutan) was destroyed and rebuilt for several times
until its owner was satisfied.
As per the provided case scenario, it has been observed that Aman Resorts do not provide
any kind of discounting offers to any of its guest. However, it can be argued that the resort has its
own set of reasons behind the same (Varadarajan, 2010). It has been the culture of Aman Resorts
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that it has never lowered down its prices except for Amapuri in 2004 due to Tsunami. Even if it
was able to earn higher profits in 2004 due to low prices, the resort has never reduced its prices
after than time. The rationale behind this was to develop itself as a very strong brand in market.
Other than this, it can be also stated that Aman Resorts is not using any form of traditional
advertisement which can become a serious issue in the future (Wilson and Gilligan 2012).
On the other side of this, some guests also feel that they are paying very high prices in
Aman Resorts as compared to the kind of services which were getting. For example one of the
guests stated that there was no television in the room during their visit at Aman Resorts
Indonesia and there were many other resorts which were offering services along with TV at
comparatively low prices (Agrwal, 2012). Along with this, some guests also got disappointment
by finding lack of some lively activities such as bars.
As per the provided case scenario, it can be stated that General Manager is the one which
takes care of every individual property of Aman Resorts. Furthermore, the staff members are
being trained and developed in such a way that they always seek for establishing long terms and
healthy relation with guests (Armstrong and Taylor, 2014). They also want that a friendly
relationship is developed between hotel staff and guests when they leave the resort. Therefore, it
can be explained that not only guests but Aman Resorts has also taken care of all its employees
in effective manner. Other than this, majority which is 95% of the staff members are from local
region. Aman Resorts always seeks for the ways through which, it can provide its employees
with best work experiences with an objective to makes them learn new things and grow in life
(Baker, 2007). In addition to this, heavy emphasis is laid on training and development of staff
members. This directly results in making employees effective towards understanding clients need
and meeting the same in the best possible manner.
One of the reason behind success of Aman Resorts is that it has been always able to
understand what its guests are demanding. Further, the resort also provides more importance on
encouraging employees to interact with guests at personal level (Barnes, 2008). From the
provided case scenario, it has bee also observed that Aman Resorts staff members also ensure
that local communities and people living in them are not negatively affected by operations and
activities of the resort. For instance the farm of one woman at Amankoro Paro were destroyed by
its dogs (Ci-sheng and Shu-ming, 2012). In that situation, the supervisor of human resources at
Aman Resorts Paro personally went to the farm of that lady and helped her in the process of
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replant those destroyed potato plants.
Therefore, it can be stated that Aman Resorts has well taken care of each and every areas
in the best possible manner. This includes growth of community, employee’s development and
relationship with guest (Collings and Mellahi, 2009). However, there are few issues or
challenges which are required to overcome in order to find better growth opportunities in the
future.
1.3 Research problem
In the current case study researcher focuses on illustrating various issues and problems
that owners of Aman Resorts are facing so that potential measures can be recommended to
address them and to enhance the profitability and sustainability of resorts in different parts of the
world.
 Business management problems: Operating in competitive hospitality industry,
management problems are the common in nature that affects the course of functioning of
Aman Resorts (Gannon, Doherty and Roper, 2012). However, with constantly changing
needs and preferences of customers it has become difficult for the owners of hotels and
resorts to meet their expectations. Further, declining financial condition in the market due
to recession has affected the spending power of people which indeed decreases the
demand for leisure and superior quality of goods and services (Greasley, 2007). Whereas,
increasing competition is the most common and high concern factors for the entrepreneur
in hospitality industry as there are large number of firms offering wide range of services
to similar type of audience.
 Financial analysis and management: Due to increasing competition, Aman Resorts are
facing major issues in maintaining its business volume in recent pasts (Huber, 2011). It is
because of the fact that in order to maintain the brand image within different markets of
the world, owner is compromising on price and charging high prices for its services
which indeed limits his target audience as upper middle or higher class people can only
avail. On the other hand, offering superior quality of services to its customers cause huge
costs for the owner which he is happy to incur in order to maintain the level of class (Ika
and Saint‐Macary, 2012). This indeed creates major concern in managing financial
prospects of the Aman Resorts.
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 Marketing management: Operating different parts of the world owner of Aman Resort
faces problems in managing the marketing prospect. However, only focusing on mouth of
word publicity restricts the resort to create awareness within the market through different
methods (Mello, 2014). However, to create better awareness about the resort and services
it is important for the owner to make effective use of marketing and promotional
strategies. Along with this, it can be a costly affair for the owner because marketing
strategies consist of high costs or expenditure (Prince, 2011).
 Managing human capital and entrepreneurship: According to the case, Mr. Zecha prefers
autocratic style of leadership which is helping him to lead people effectively and generate
better results but at time such leadership approach negatively affects the morale of
employees as well as restricts them to communicate from top level management (Sedlak,
Ćirić and Ćirić, 2013).
 Current global economic issues: Looking at the financial crises around the globe,
spending power of people have been affected the most this has lead them to restrict their
spending and which indeed affected the course of companies operating as hotel,
restaurant and other luxury goods and service provider (Aras and Crowther, 2012).
Low occupancy rate: Increasing competition has affected the occupancy rate of the hotel.
According to the case, Aman resorts are facing problems in occupancy rate because of its high
prices which limits them to certain target audience (Bellgran and Safsten, 2009).
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CHAPTER 2: CASE BRIEF
2.1 Introduction
Looking at the current hospitality industry it is considered as the premium source of
income for the several economy. However, companies operating in it are making valiant efforts
to satisfy the needs and wants of customers to generate higher business volume. Considering the
present case given, owner of Aman Resorts is also following the same path and putting tons of
efforts to satisfy the expectations of customers (Bradshaw and Urquhart, 2015). The main
purpose of Aman Resort existence is to provide new experience to its customer by providing
them peace and natural environment through the resort by opening it in remote areas. Further,
maintaining the balance between local amenities and imported products to ensure the highest
level of satisfaction for the customers. Further to this, structural prospects of resorts also highly
depend upon the experience and satisfaction level of its owners (Kumaraswamy, 2011).
However, they are constantly focusing on providing the best possible environment to their
customer’s better art and building. Zecha has been always particular or specific about the design
and development of all properties of Aman resorts. This can be justified by the fact that the
rooms in one of its property, Amankora (Bhutan) was destroyed and rebuilt for several times
until its owner was satisfied (Lakhal, Pasin and Limam, 2006).
At present operating in 14 countries of the world, owner is making constant efforts
modify the resorts at each destination as per the local surroundings and amenities so that people
visiting the place can feel like home atmosphere as well as connect to the local communities and
societies in more effective way (Motohashi, 2015). However, maintaining brand image is one of
the prior objective of Aman resorts and for which owner does not compromise on charging high
prices. But it has been considered as one of the main reason behind the success of Aman resorts
because people are paying higher money for the leisure and luxury that cited resort is able to
provide them. On the other hand of it, Mr Zecha also focuses on enhancing of skills and abilities
of employees through varied training and development sessions (Yang, Kueng and Hong, 2015).
This in order to ensure that staff members interact with employees in better and effective way
and understand the wants and reacts accordingly. On the basis of given case study, it can be said
owner of Aman resort is making valiant efforts to manage all the departments in different parts of
the world which indeed leading the resort to generate better results and outcomes (Zu, 2009).
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2.2 Research aim
The aim of this research is provided below as:
“To identify the barriers affecting growth and success of hospitality organizations”- A
study on Aman Resorts.
2.3 Researcher objective
 To determine the current position and performance of Aman Resorts
 To identify key challenges/issues faced by Aman Resorts
 To assess appropriate business tools which can support in addressing business problems
 To recommended ways through which Aman Resorts can overcome its key issues and
enhance its market performance
2.4 Research questions
 Determine the current position and performance of Aman Resorts?
 What are the key challenges/issues faced by Aman Resorts
 What are the models which can be used to analyses key challenges faced by Aman
Resorts?
 Determine ways through which Aman Resorts can overcome its key issues and enhance
its market performance?
2.5 Structure of the case study
In order to carry out a study in systematic manner it is essential for the researcher to
abide the proper structure. However, structure of the report set a platform for the investigator to
carry out the essential aspects of the study in detailed and in-depth manner. Considering the
present case study, researcher needs to follow appropriate structure so as to make sure that each
and every aspect of the selected topic can be assess and analyzed in the best possible manner.
 Chapter 1 Case Brief: In this section, researcher aims at illustrating the given case study
so that readers or learners can easily develop base what exactly the study is all about. In
this chapter, background of the study is define which helps the course of investigator to
understand about the entire report. Further, problems of the research are discussed so that
to develop suitable aim and objectives for the whole case study analysis.
 Chapter 2 Introduction to case brief: Once the theoretical base is developed regarding the
given case, it is easy for the investigator to develop appropriate aim and suitable
objectives for the study so that future strategies and tactics can made accordingly to
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achieve the same.
 Chapter 3 Plan of Analysis: In this section, researcher focuses on presenting the work of
different authors and scholars to carry out literature review on the selected topic. Herein,
investigator will focus on different barriers that hotel or resort is facing while carrying
out its operations in different parts of the world.
 Chapter 4 Findings and Analysis: In this section, the data generated through plan of
analysis section is analyzed so that suitable and reliable findings can be generated.
However, considering the nature of current study different marketing, strategic
management and related theories will be employed so that problems identified within the
functioning of Aman Resorts can be resolved.
 Chapter 5 Proposed Solution to the problems: This is the last section of the study in
which investigator aims at proposing the solutions to the management of Aman Resorts
on the basis of problems identified and models employed to mitigate the issues.
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