Business Analysis and Recommendations: Cunningham Golf Resort Project

This case study analyzes the proposed Cunningham Gudgal Golf Resort project, a $20 million venture by Cunningham Holdings. The project involves constructing a golf course and a clubhouse, with a focus on promoting tourism and stimulating the local economy. The analysis focuses on the conflict between shareholders and managers regarding the type of clubhouse (exclusive vs. standard) and the design of the golf course. The report presents an action plan that involves determining decision variables, identifying the objective function (maximizing client enjoyment), and defining constraints (budget, land size, and international golf resort standards). The analysis includes five options, modeled using Excel Solver, with varying golf hole configurations and clubhouse types. The report recommends the managers' plan, which involves an international standard golf course with a standard clubhouse, as the optimal solution based on resource constraints and enjoyment index. Alternative options are also considered, including adjustments to the clubhouse size and cost to optimize client enjoyment within the budget.

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Running head: DATA ANALYSIS
DATA ANALYSIS
Student’s Name
Institution Affiliation

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DATA ANALYSIS
Introduction
The Cunningham Holdings is a diversified family owned corporation that specializes in
providing hospitality services. The company’ strategizes its operation in a manner that is aligned
with the its corporate vision which is meant to create globally sustainable services and products.
As a way of promoting its vison, the firm is interested in the development of the rural
communities. The CEO of the firm Oscar Cunningham has presented the board with a project
that will include constructing The Cunningham Gudgal Golf Resort at a total cost of $ 20
million. This project is expected to provide accommodation, catering and leisure activity
services. The Golf Course project is targeted at building the Cunningham brand as well as
assisting drive tourism and stimulate the economy of the local environment. On behalf of the
managers the CEO has conducted an extensive research and come up with some of the features
that should be incorporated in the golf club for it to meet international standards. In addition to
constructing the golf club, the firm will also like to include a clubhouse. Currently there is a
conflict between the shareholders and the managers on the type of clubhouse to incorporate. The
shareholders are suggesting an exclusive clubhouse while the managers have come up with the
option of constructing a standard clubhouse.
As the senior business analysist with Cunningham holdings I was tasked with evaluation
of the various options and coming up with the best course of action that could be implemented
using the available resources. This report therefore presents the analysis and the findings with
regard to the available options. Also, present is a recommendation that gives suggestion of the
best preferable model that the firm should adhere to.
Description of the implementation of the models
Action plan: These entails the steps that were followed in developing the models. The
first step was to determine the decision variables. In this case there are two sets of decisions to be
made; the first is the number and type of golf holes that the golf resort is to be made of, the
second one is the type of clubhouse that should be included in the golf resort. The second step is
the identification of the objective function. Since Cunningham holdings is focused on ensuring
its customers are contented with its services, the new project will be developed in a manner that
maximises the overall enjoyment index of the clients. The last step will be identification of the
constraints. These are the features that need to be met by the project. Based on the research of the

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DATA ANALYSIS
CEO, there are set features that an international golf resort ought to possess, this did form part of
the constraint in addition to the limitations brought about by scarcity of resources.
Using the excel solver add in the 5 options that were to be considered by the firm were
modelled and the results developed as in the tables below.
i. The managers plan
The International Standard Golf Course
Kind of golfing
hole
Number of
holes Par
Size taken
up by hole
(Ha)
Enjoyment
Index Building cost
Straight par 5 3 15 9 6 $3,000,000
Dogleg par 5 1 5 3.5 1.5 $1,500,000
Straight par 4 2 8 4 3 $1,500,000
Dogleg par 4 8 32 20 16 $7,200,000
Long par 3 1 3 1 1.75 $600,000
Short par 3 3 9 2.25 6.75 $1,950,000
Total 18 72 39.75 35 $15,750,000
Standard Clubhouse
Land size (Ha) 2
Construction Cost $3,500,000
Constraints
Total cost $19,250,000 <= $20,000,000
Total land size 41.75 <= 42
Number of holes 18 = 18
Straight par 5 3 >= 1
Dogleg par 5 1 >= 1
Straight par 4 2 >= 2
Dogleg par 4 8 >= 2
Long par 3 1 >= 1
Short par 3 3 >= 1
Par 5 4 <= 4
Par 4 10 <= 14
Par 3 4 <= 4
Total par 72 >= 70
Total Par 72 <= 72
Total land size 39.75 >= 36
Objective function
Total Golfer's enjoyment 35

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DATA ANALYSIS
ii. Shareholders request
The International Standard Golf Course
Kind of golfing
hole Number of holes Par
Size taken up by
hole (Ha) Enjoyment Index Building cost
Straight par 5 1 5 3 2 $1,000,000
Dogleg par 5 1 5 3.5 1.5 $1,500,000
Straight par 4 10.74999919 42.99999675 21.49999837 16.12499878 $8,062,499
Dogleg par 4 2 8 5 4 $1,800,000
Long par 3 2.250003858 6.750011575 2.250003858 3.937506752 $1,350,002
Short par 3 0.999997 2.999991 0.74999775 2.24999325 $649,998
Total 18.00000004 70.74999932 35.99999998 29.81249878 $14,362,499.75
Exclusive Clubhouse
Land size (Ha) 4
Construction Cost $6,000,000
Enjoyment Index 4
Constraints
Total cost $20,362,500 <= $20,000,000
Total land size 39.99999998 <= 42
Number of holes 18.00000004 = 18
Straight par 5 1 >= 1
Dogleg par 5 1 >= 1
Straight par 4 10.74999919 >= 2
Dogleg par 4 2 >= 2
Long par 3 2.250003858 >= 1
Short par 3 0.999997 >= 1
Par 5 2 <= 4
Par 4 12.74999919 <= 14
Par 3 3.250000858 <= 4
Total par 70.74999932 >= 70
Total Par 70.74999932 <= 72
Total land size 35.99999998 >= 36
Objective function
Total Golfer's enjoyment 34
iii. Option 1

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DATA ANALYSIS
The International Standard Golf Course
Kind of golfing
hole Number of holes Par
Size taken
up by hole
(Ha) Enjoyment Index Building cost
Straight par 5 2 10 6 4 $2,000,000
Dogleg par 5 1 5 3.5 1.5 $1,500,000
Straight par 4 9 36 18 13.5 $6,750,000
Dogleg par 4 2 8 5 4 $1,800,000
Long par 3 3 9 3 5.25 $1,800,000
Short par 3 1 3 0.75 2.25 $650,000
Total 18 71 36.25 30.5 $14,500,000
Exclusive Clubhouse
Land size (Ha) 2.5
Construction Cost $5,500,000
Enjoyment Index 4
Constraints
Total cost $20,000,000 <= $20,000,000
Total land size 38.75 <= 42
Number of holes 18 = 18
Straight par 5 2 >= 1
Dogleg par 5 1 >= 1
Straight par 4 9 >= 2
Dogleg par 4 2 >= 2
Long par 3 3 >= 1
Short par 3 1 >= 1
Par 5 3 <= 4
Par 4 11 <= 14
Par 3 4 <= 4
Total par 71 >= 70
Total Par 71 <= 72
Total land size 36.25 >= 36
Objective function
Total Golfer's enjoyment 35
iv. Option 2

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DATA ANALYSIS
The International Standard Golf Course
Kind of golfing hole
Number of
holes Par
Size taken up
by hole (Ha) Enjoyment Index Building cost
Straight par 5 1 5 3 2 $1,000,000
Dogleg par 5 1 5 3.5 1.5 $1,500,000
Straight par 4 6 24 12 9 $4,500,000
Dogleg par 4 6 24 15 12 $5,400,000
Long par 3 1 3 1 1.75 $600,000
Short par 3 3 9 2.25 6.75 $1,950,000
Total 18 70 36.75 33 $14,950,000.00
Exclusive Clubhouse
Land size (Ha) 4
Construction Cost $5,000,000
Enjoyment Index 4
Constraints
Total cost $19,950,000 <= $20,000,000
Total land size 40.75 <= 42
Number of holes 18 = 18
Straight par 5 1 >= 1
Dogleg par 5 1 >= 1
Straight par 4 6 >= 2
Dogleg par 4 6 >= 2
Long par 3 1 >= 1
Short par 3 3 >= 1
Par 5 2 <= 4
Par 4 12 <= 14
Par 3 4 <= 4
Total par 70 >= 70
Total Par 70 <= 72
Total land size 36.75 >= 36
Objective function
Total Golfer's enjoyment 37
v. Option 3

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DATA ANALYSIS
The International Standard Golf Course
Kind of golfing hole
Number of
holes Par Size taken up by hole (Ha)
Enjoyment
Index Building cost
Straight par 5 2 10 6 4 $2,000,000
Dogleg par 5 1 5 3.5 1.5 $1,500,000
Straight par 4 9 36 18 13.5 $6,750,000
Dogleg par 4 2 8 5 4 $1,800,000
Long par 3 3 9 3 5.25 $1,800,000
Short par 3 1 3 0.75 2.25 $650,000
Total 18 71 36.25 30.5 $14,500,000.00
Exclusive Clubhouse
Land size (Ha) 4
Construction Cost $6,000,000
Enjoyment Index 4
Constraints
Total cost $20,500,000 <= $20,500,000
Total land size 40.25 <= 42
Number of holes 18 = 18
Straight par 5 2 >= 1
Dogleg par 5 1 >= 1
Straight par 4 9 >= 2
Dogleg par 4 2 >= 2
Long par 3 3 >= 1
Short par 3 1 >= 1
Par 5 3 <= 4
Par 4 11 <= 14
Par 3 4 <= 4
Total par 71 >= 70
Total Par 71 <= 72
Total land size 36.25 >= 36
Objective function
Total Golfer's enjoyment 35
Analysis of the feasible models
Upon developing the 5 possible models, it was observed that the shareholder’s request could
not be achieved. It is not possible to meet the requirements of an exclusive clubhouse as well as
develop an international golf resort with the available resources possessed by the firm as at now.
The four models that should be considered therefore include.

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DATA ANALYSIS
i. The managers plan
This entails developing an international standard golf course with a standard club
house included in it. Using the available resources, the optimal decision by the firm
will be to build the type and number of holes as described in the table below.
Kind of golfing
hole
Number of
holes
Straight par 5 3
Dogleg par 5 1
Straight par 4 2
Dogleg par 4 8
Long par 3 1
Short par 3 3
Total 18
In addition, the firm should construct a standard clubhouse at a cost of $ 3.5
million. This will cost the company a total of $ 19.25 million and a land space of
41.75 hectares. The total enjoyment index that the consumers will derive from this
project will be 35. The managers plan is an ideal option as it meets the international
standard for a golf resort and also with just the budget allocation of the firm. The
project will provide 18 golfing holes which was the target of the managers.
ii. Option 1
Since the shareholders request could not be met using the available resources, I
did come up with an alternative that will assist improve on the managers suggestion.
This option entails reducing the total land space to be covered by the exclusive
clubhouse from 4 hectares to only 2.5 hectares. In addition, the budget allocation for
the clubhouse should be reduced to $ 5.5 million instead of the initially suggested $ 6
million. To optimize the total enjoyment index for the clients, the firm should
construct the type and number of holes as described in the table below.

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DATA ANALYSIS
Kind of golfing
hole Number of holes
Straight par 5 2
Dogleg par 5 1
Straight par 4 9
Dogleg par 4 2
Long par 3 3
Short par 3 1
Total 18
This will cost the firm a total of $ 20 million and a land area of 38.75 hectares. In
return it will yield a total enjoyment of 35. Comparing the option 1 with the
managers plan, the best decision will be to go with the mangers plan. This is because
the initial plan by the mangers will only incur a total cost of $ 19.25 million while at
the same time yielding equal enjoyment index as option 1.
iii. Option 2
The second alternative that can be considered instead of the shareholders request
will entail reducing the cost allocated to the exclusive clubhouse to $ 5 million
instead of $ 6 million. The clubhouse will be built on a 4-hectare land area. The
number and type of holes that need to be built so as to maximise the utility of the
clients from this project will be as explained by the table below.
Kind of golfing hole
Number of
holes
Straight par 5 1
Dogleg par 5 1
Straight par 4 6
Dogleg par 4 6
Long par 3 1
Short par 3 3
Total 18
This will cost the firm a total of $ 19.95 million and a land area of 40.75 hectares.
In return, the total enjoyment index derived from the project by the consumers will be
37. Comparatively this option is superior to the option 1 and the managers plan
developed in the models above. It utilizes the available resources to give a give a
higher enjoyment index.
iv. Option 3

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DATA ANALYSIS
In this option, the firm will go with the shareholders request but with the total
budget allocated for the project increased from the initial $ 20million to $20.5
million. The firm will thus have to raise the additional $ 500,000 needed to complete
the project. To optimise the consumer satisfaction using these new conditions the
number and type of golf holes that need to be constructed will be as displayed in the
table below;
Kind of golfing hole
Number of
holes
Straight par 5 2
Dogleg par 5 1
Straight par 4 9
Dogleg par 4 2
Long par 3 3
Short par 3 1
Total 18
This will incur a total of $ 20.5 million and land space of 40.25 hectares. In result,
the consumers will derive a total enjoyment index of 35. Comparatively, this option is
the worst out of the 4 modelled above. With a budget of $ 20.5 million, the option
generates a similar enjoyment index to the managers plan and the option 1 identified
above.
Implication of the feasible models
The shareholders request is for the firm to allocate $6 million to building an exclusive
clubhouse that will occupy an area of 4 hectares. Out of all the four feasible models developed
above, only option 3 meets the demands of the shareholders. It however deviates from the $ 20
million budget allocated by the managers for the construction of the golf resort. Even though
both option 1 and 2 entails building an exclusive clubhouse, option 1 only allows allocating $ 5.5
million and building a clubhouse in a space of 2.5 hectares. On the other hand, option 2 only
allocates $5 million to the construction of the clubhouse.
Recommendation

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DATA ANALYSIS
Going by the consumer satisfaction maximization criteria, the model that ought to be
considered is that developed under option 2. This will return an enjoyment index of 37 which is
the highest out of the four feasible options. Option 1, 3 and the managers plan both yield an
enjoyment index of 35. I therefore recommend the firm to seek ways of cutting the cost of
constructing the exclusive warehouse to $ 5 million and implement the model developed by
option 2. Cost of construction is a volatile variable that is affected by a number of factors and
may fluctuate from time to time. Should the firm not be in a position to cut down the cost of the
club house to $ 5 million, they should instead settle for the managers plan. This project will yield
an enjoyment of 35 at the minimum cost of just $ 19.25 million. Option 1 should be rejected as it
entails constructing just a 2.5-hectare exclusive clubhouse yet consumes a total of $ 20million
and yield an enjoyment index of 35. Option 3 just like option 1 should be rejected. This option
demands injecting an additional $ 500,000 into the golf resort only to yield a total 35 enjoyment
index.