Eleganzia Group: Analyzing Challenges in Forte Village Resort

This case study analyzes the Eleganzia Group, a luxury hotel chain, focusing on its Forte Village resort. It examines the challenges faced, particularly during the 2008-2009 recession, including declining revenues, changing consumer behavior, and increased competition from major hotel brands. The study details the strategies implemented by the group, such as transforming hotels to higher star ratings, expanding food and beverage offerings, and upgrading technology. It highlights the impact of these strategies and the need for improved marketing and pricing strategies to combat recessionary pressures and ensure long-term sustainability. The report includes an introduction, case brief, problem statement, analysis, and proposed solutions, incorporating models like the 7 P's Matrix and SWOT analysis to evaluate the group's performance and recommend strategies for future success in the competitive hospitality market.

CASE STUDY
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EXECUTIVE SUMMARY
Eleganzia Group is a luxurious Hotel group that focuses on delivery of combining
comfort, relaxation & fun to the target audiences to fulfill their demand. Italianity, best quality
offerings, innovations as well as uniqueness are the four key pillars behind the success of the
industry. The present report targeted at examining the current issues and challenges faced by its
one of the leading hotel chain, Forte Village, so that, appropriate decisions and ways can be
suggested to combat the prevailing issues, more importantly, due to crisis. The report founded
that during the period of crisis, Forte Village faced difficulties in their operations due to declined
trend of revenues and change in consumer buying pattern. As a result, managers reviewed its
pricing mechanism and its General Manager, Giannuzzi had decided to charge higher prices to
improve revenues. Moreover, they adopted many strategies and made decisions for deriving
success such as transformation of four-star hotel into five-star, food & beverage, conferences and
other events, technological upgradation like GDS & CRM, co-branding and others. Although, the
results did not brought significant level of improvement and cannot be considered as an effectual
step to overcome recession barriers. In addition to this, tough completion from Starwood, Hilton
& Marriott Hotel & Resorts and change in people attitude & buying pattern brought threats to the
Eleganzia Group. Thus, lastly, in order to combat the recession pressure, Eleganzia Group has
been suggested to create excellent marketing strategies using modern technologies & consider
economical changes to track the market volatility and set the standard pricing policies to ensure
long-run sustainability.
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TABLE OF CONTENTS
Introduction......................................................................................................................................4
Case brief ........................................................................................................................................6
Problem statement ...........................................................................................................................8
Analysis and findings ....................................................................................................................13
7 P’s Matrix...............................................................................................................................13
SWOT model.............................................................................................................................16
Strategic human capital planning...............................................................................................18
Proposed solution...........................................................................................................................19
REFERENCES .............................................................................................................................22
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INTRODUCTION
In present study, work culture of Eleganzia Group has been evaluated in desired manner.
It has been noticed that company is operating its services in the hospitality sector. In addition to
this, it can 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. In
present market conditions the hospitality sector is having great advancement in regard to
improvement of services. Along with this, ratio of competition in the market is very high which
also influences the overall outcome in diverse manner (Hollensen, 2015). In addition to this, it
can be said that by having an appropriate selection of strategies the businesses can have better
opportunities within organisation. Each and every market player is trying very hard to gain high
market share and customer base. As per the view of, in recent years the demand of international
resorts among people in market has increased to a great extent. Hospitality sector is considered
as a sector in which number of businesses are attaining diverse opportunities.
In addition to this, it can be stated as per case given, Eleganzia Group is considered as a
hotel and spas. It is referred as luxurious aspects so that long term sustainability can be attained
in appropriate manner. It has been noticed that company is holding a Forte Village's five star
hotels. In year 2009 business firm was offering presidential suite at rate of 3300 Euro per person
per night. According to given case, it can be stated that company is facing diverse issues in
regard to Italian market which impacts the overall outcome of business in diverse manner (Babin
and Zikmund, 2015). In addition to this, it can be stated that economic crises has influenced
overall business in diverse manner. It has created an issue in regard to pricing model and forced
company to offer rooms at half of the prices. Along with this, application of pricing strategy is
also significant for every business firm. Staff skills issue and marketing issues also creates an
barrier for company so management need to refer it effectively. By having an improved focus on
number of initiatives and methods the Eleganzia Group can easily overcome the issue. It brings
an improvement in services which helps in developing a feeling of relaxation and satisfaction
among all resort guests (Pfoertner and et.al., 2014).
However, at the economic crises the owner also percept market conditions as a good
opportunity of market expansion. In this respect, he has explored the most prestigious hotel The
Eden which is considered at bargain price in present situation. In addition to this, group has also
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owned management rights to Castel Monastero in Tuscany. At the same time, he has decided to
open two other hotels in Sardinia. Present investigation provides a detail analysis of such aspects
which are considered by Giannuzzi. Moreover, the company has also opened tennis academy for
chidrens in year 2008. Soccer camps were being organised at the same period. Even, after such
adjustments the Forte Village’s is facing issues in regard to sales of rooms.
Research Aim
The aim of this research is provided below as:
“To identify the issues faced by business in operational activities of hospitality
organizations and methods to overcome challenges”- A study on Eleganzia Group
Researcher objective
 To determine the current position and performance of Eleganzia Group
 To identify key challenges/issues faced by Eleganzia Group
 To assess appropriate business tools which can support in addressing business problems To recommended ways through which Eleganzia Group can overcome its key issues and
enhance its market performance
Research questions
 Determine the current position and performance of Eleganzia Group?
 What are the key challenges/issues faced by Eleganzia Group?
 What are the models which can be used to analyses key challenges faced by Eleganzia
Group? Determine ways through which Eleganzia Group can overcome its key issues and
enhance its market performance?
Structure of the report
Current research investigation is progressed with a consideration of systematic values so
that effective and beneficial outcome can be attained. In this respect, systematic structure of the
research report is also being taken into account. Chapter 1: Introduction: In addition to this, it can be stated that section is consisted of
brief overview regarding whole research. It has been noticed that present section is
beneficial to attain information about diverse areas which are essential for study.
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Classification of areas that are discussed in introduction are background of study, aims
and objectives of research, research questions, etc (Coope and et.al., 2014). Chapter 2: Case brief: It is a chapter which offers a brief description of the overall
situation. It means by having a brief consideration the case study of Eleganzia Group can
be evaluated in desired manner. Chapter 3: Problem statement and plan of analysis: This chapter is entailing sections
like statement of problem, literature review for present investigation, proposed plan for
the analysis of information. Along with this, evaluation of sources of data for present
investigation is also being taken into account. Chapter 4: Analysis and Findings: It is a section which offers an analysis of gathered
information on the basis of case study. Analysis of information helps in attaining better
outcome from the study (Harhay and et.al., 2014).
 Chapter 5: Proposed solution to the problem: It is a chapter which provides an
integrated assessment, recommendations, limitation and scope of this study. With an
assistance of this, better outcome can be attained because it also allows to have
application of learning from the present research. Findings of research can be used by
different organisations in the same sector.
CASE BRIEF
Eleganzia Group is a luxurious Hotel group that is exclusively devoted luxury hotel brand
located in Italy. It focuses on delivery of combining comfort, relaxation & fun to the target
audiences to fulfill their demand. The brand is appreciated all around the globe because of its
magical and unique services. It owns two most well established resorts in Italy that are Forte
Vilage Resort & Castel Monestero. The main objective of the Group is to build a strong link with
the customers for the high level of satisfaction of high income individuals. The present study is
based on Forte Village, established in the year 1971 in Southern Sardinian. It is the perfect place
for spending holidays and become the world-renowned destination for the high-yielding guests
such as Britsh Football Player, film stars, top industrialists and other VIP visitors. In addition to
the five star hotels, it also offers four star hotel rooms to accommodate people at half board
packages including dinner & breakfast services. However, for the extra services like gaming,
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Soocer, Spa, bowling, food & beverages, it charges additional from the guests to maximize
revenues and generate better yield through regular course of actions.
Over the years, in 1994, it has one three star hotel & three 4-star hotels which are now
became the part of Le Meridien hotel chain, acquired by Eleganzia Group. In a very short span of
time of 1 year to 1995, it expand their chain and owned 1000 hotels and 3000 restaurants and
become world’s leading catering business, afterwards, in 1996, Granada company took over the
group. During this time, Giannuzzi had completed one year of working in Forte Village at
General Manager Post but after, he joined Caribbean hotel chain. Again, in the year 1995, he
recalled by the Forte Village Resort to rejoin the Group again as it was severing difficulties in
the operations. When he met with the Lord Forte, he noticed that consumer said that the prices
charged by the hotel were extremely high and recommended to drop down the prices for
maximizing occupancy rates. But still, there was a lots of confusion observed in the resort
management as II Castello were utilized as a business venue by a conference centre on the top
floor but offered accommodation services as well. Moreover, the largest hotel of the resort, II
Villaggio had 494 bungalows still have no real character. But after the rejoining by Giannuzzi,
his excellent management & working style transformed the 3-starer hotel into 4-star, Castello &
Villaggio bungalows into well-established 5-star hotel to accommodate VIP guests. The strategic
focus of his was on treasure hunting aims at putting attention of underutilized properties so as to
make it attractive and wow for the visitors to generate maximum earnings. Thereafter, during the
period of 1995 to 2007, 6 times it ownership structure has been changed due to the investment by
FIMIT & MITA resort, in which, Giannuzzi acquired 10% shares & became its General
Manager. In 2007, Walt Disney’s CEO also visited the hotel and told that it was really a luxuries
experience due to its key pillars, Italianity, quality services, uniqueness & innovations to have a
stay in Forte Village and no-doubt; it is the second leading hotel chain of the world, after Disney.
Till 2008, he maximized its total revenues from 22 Euro million to 74 Euro million at an annual
return of 31 dollar million and received “World’s Leading Resort” award.
During the period of recession in 2008/ 2009, economic slowdown, crisis created
negative impact to the industry and affected its sales revenues and yield adversely. It bring
necessity for the hotel to rethink upon its pricing model & in respond, Giannuzzi decided to
increase room charges by 7% and 2% for 4-star & 5-star hotels. During the period, prices
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charged by the hotel were too high as it was 295 Euro for HB, 4500 Euro for Castello royal suite
& 50000 a week for the Villa. Personalized, friendly & Italian traditional hospitality services
linked with the staff professionalism helps to serve consumers exceeding expectations. The
period of crisis had changed the customers buying pattern in 2009, out of total revenue of 6 Euro
million, 1.5 million was received as a fee. At that time, although consumers have money still,
they spend less on extra facilities due to psychological reasons. Although, economic downturn in
2009 caused adverse impact, still, resort explore the benefit of various market opportunities such
s Rome’s prestigious hotel, Eden and Castel Monastero in Tuscany. Moreover, two other hotel
chains also has been constructed that were Maddalena Hotel & capo Malfatano. Resort spend 4.5
Euro million on marketing & promotion, out of which 1.5 Euro million spent just to pay wages
to the marketing staff which was extremely expensive. Company faced tough competition from
thje Starwood, Hilton, Mariott & other leading hospitality brands. In order to respond the
recession period, Giannuzzi & management team decided to charge higher prices for the
luxurious facilities. In the low season, they delivery free of charges extra services like free access
to Spa, Wi-FI & others to increase brand value. In order to attract more visitors, it founded
several unique ways to attract more and more visitors such as charging high prices, transforming
mini-club into Children’s City with extra facilities. Moreover, co-branding strategy, special
training to the staff, leisure & sport services, luxury shopping deliveries through opening many
stores, hosting conferences & other business events has been used for the purpose of revenue
maximization to face the challenges of crisis.
However, on the other hand, it acquired Castel Monastero & La Maddalena Hotel &
Yacht Club during the crisis for the expansion of the business. In addition to this, it recently
obtains management rights in Eden because it has a unique location in Rome. Apart from this, in
order to expand audience base, it focuses on technological advancement such as GDS (Global
Distribution System program) via travel agencies, tour operators and others. All these strategies
employed by the resort mainly targeted at reducing the impact of economic crisis over the
regular functionality of the business.
PROBLEM STATEMENT
Statement of the problems in the Case
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It has been noticed that in order to meet the success factors the business firm need to
consider factors such as innovation, practice, human capital, etc. With an appropriate information
regarding classified elements the company can easily attain competitive edge. Along with this,
competition to such aspects can be offered effectively. It is also significant for management of
Eleganzia Group to consider proficiency and operational efficiency in desired manner. Company
is offering wide range of services in the market so management need to consider marketing,
innovation and further elements in appropriate manner.
Literature Review
Hospitality sector is having a great opportunity in the market because of integrated
working within sector. Moran and Hunt, (2014) has stated that there are number of services
which are being offered by the management so that goals and objectives can be accomplished
effectively. Classification of hospitality services is as food and restaurant, accommodation, etc.
In order to have effective accomplishment of goals and objectives the business firm need to
analyse key aspects associated with the business. Moran and Hunt (2014) has contended that
financial analysis of also need to consider because it helps in designing of strategies. Viability,
stability and profitability of the business must be accessed in desired manner. Economic position
of business entity also need to be consider as critical aspect so that decisions can be taken into
account effectively. It has been noticed that any kind of changes in economic values impacts the
overall business in diverse manner. It reflects that analysis of economic values is significant in
order to ensure about long term opportunities.
Nieto et.al., (2014) has asserted that application of quality system is also significant to
consider so that long term opportunities can be attained. By having an improved focus on quality
services the service effectiveness can be advanced in desired manner. In order to meet the market
needs the use of marketing strategy is also significant to consider from the management.
Appropriate pricing of products and services also need to refer because it advances the
opportunities for business. As per the view of Rahimnia and Hassanzadeh (2013), promotional
and marketing strategies are integral part of business especially in hospitality sector where
company faces high level of competition. By having use of diverse marketing methods the
business firm can easily create awareness within market. Hospitality enterprises are having a use
of diverse promotional tools in order to meet objectives. In addition to this, it can be stated that
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by having application of diverse methods the products and services can be promoted effectively
in the market. Innovation is also needed to be refer effectively because it helps in meeting key
goals and objectives.
Proposed plan for analysis
Research analysis is referred as part of study which allows to understand the path in order
to attain better outcomes. It helps in meeting the goals by having better results in regard to
subject. However, current plan is planned in regard to factors like international marketing,
human resource management and strategic management (Huang and Sarigöllü, 2014). In addition
to this, diverse models are being taken into account such as 7P's Matrix, strategic human capital
planning and swot analysis.
Problem statement for international marketing
Every business firm is focused towards application of marketing strategies in order to
gain competitive advantage. It helps in advancement of market share so that better opportunities
can be attained. In addition to this, it can be stated that marketing mix can be employed by firm.
It means there are key seven factors which need to be evaluated in context to Eleganzia Group.
Seven P's of marketing are classified as product, price, place, promotion, physical evidence,
people and process (Hanssens and et.al., 2014). It has been witnessed that use of such tool allows
to have better marketing of company so that more customers can be attracted. With an assistance
of this, marketing strategy evaluation can also be taken into account so that overall effectiveness
can be strengthen in desired manner.
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Problem statement for human resource management
HR is considered as one of most critical aspect for every organisation because it helps in
meeting the success standards. In order to have continuous improvement in the work style the
management of Eleganzia Group also need to focus on models of human resource like strategic
human capital planning. In addition to this, it can be stated that strategic human resource
planning is tool that provides a detail about concerned authority. With an assistance of this, the
manpower management planning can be taken into account. In order to have effective
consideration of human capital planning the management need to focus of employees, gape
among members and investment (Jones and et.al., 2016). By having an improved focus on such
aspects the human capital planning can be accomplished in desired manner. In addition to this, it
can be stated that HRP of Eleganzia Group need to be evaluated in appropriate manner. With an
assistance of this, companies can have effective determination of employees and their needs. It
means work management can be advanced effectively by having consideration of such values. It
also assists in identification of gapes and priorities so that better actions can taken into account.
It improves the planning of organisation and ensure that competitive advantage over rivals can be
attained effectively.
Problem statement for strategic management
Strategic aspects also need to be referred by management because it helps in dealing with
conflict situation. In addition to this, reflection of Swot analysis in regard to Eleganzia Group
need to be considered. With an assistance of this, organisational strength, weakness,
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opportunities and threats can be analysed effectively. It means Swot analysis need to consider
analysis as a tool which offer better idea about environmental values. It allows to have better
formation of strategies so that goals and objectives can be accomplished in desired manner
(Legrand, Sloan and Chen, 2016).
Sources of data
In addition to this, objectives accomplishment can be taken into account by having an
application of diverse sources. It has been noticed that sources of data can be classified as data
collection, analysis, reliability, validity, etc. Present investigation provides a detail information
about qualitative data for gathering of information and meeting key goals and objectives. It has
been noticed that data collection is being accomplished with a help of diverse secondary sources
such as books, journals, magazines, online articles, etc (Boella and Goss-Turner, 2013). It
provides authentic research outcomes so that framed objectives can be meet effectively. Data
analysis is considered as qualitative data method which allows to have effective interpretation of
data. In this, different models are being used to attain the fruitful results. It is a method which is
mainly considered for attaining results on the basis of several themes.
In order to conduct the appropriate research, information reliability and validity will be
referred effectively from the experts. It is necessary to ensure that efforts are being entailed
without any kind of biasness because it helps in attaining reliable information. Moreover,
validity provides a support to authentication of data. In order to ensure about such aspects the
business firm is well focused towards copyright and trademark. The researcher assured the
participants that in no case will the identifying information be made available to anyone who is
not directly involved in the study (Liu andet.al., 2014). By following the principles of
anonymity, researcher ensured that the participants remain anonymous throughout the study.
With an assistance of ethical values the key measures are being taken into account effectively so
that objectives can be attained effectively. Along with this, permission to access the significant
information for the study is also being referred effectively from the management. It helps in
gaining better information about the data so that better outcomes can be attained. Research
limitations is also critical which need to be referred effectively from the management. Research
is referred as lengthy procedure because number of secondary data is being need to accessed in
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