Canyon Ranch represents the health resort and spy industries. It should be noted that in this market, the bargaining power of customers is very high since these people are not very sensitive about the price, and they can easily switch to another company if they become dissatisfied with the services offered by Canyon Ranch.
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Secondly, Canyon Ranch is very much exposed to the threat of substitute services, in particular, one has to speak about the increasing convergence of spa industry and medicine. Moreover, many physicians recommend spa treatment as an alternative to the patient (Applegate, Austin & Soule 2009, p 171).
As far as intensity of competition is concerned, we can say that Canyon Ranch retains the leading position among in this area, and very few companies can compete with them in terms of pricing or quality.
However, this industry is growing at very rapid pace; in fact the total number of spa resorts increased by eighty per cent and this trend can lead us to the conclusion that the threat of new entrants is relatively high (Applegate, Austin & Soule 2009, p 168).
The only force is going to have a positive impact on Canyon Ranch is low bargaining power of suppliers. Canyon Ranch can buy furniture, equipment, food from a great variety of companies which want to retain Canyon Ranch as their customer.
For a very long time, the IT system of Canyon Ranch was focused on the property management. However, at the given moment this system fails to serve many of the organizational needs. For example, the management of Canyon Ranch knows very little about the purchasing decisions of their clients.
Furthermore, the existing IT system does not include point-of-sale software that would allow customers to buy beauty goods (Applegate, Austin & Soule 2009, p 172). Overall, one can say that IT system is essential for effective customer management. It enables them to understand their buying preferences. Intelligence system can enable them to know what kind of services and products their clients will require.
On the basis of these data, they can make their work more oriented toward the needs of their customers. In the future, information technologies will be even more incorporated into the structure of Canyon Ranch. It will be used by management and customers. These technologies will affect different areas: 1) financial transactions, 2) resource allocation; 3) time management; and 4) service development.
If I were in the position of the Chief Information Officer, I would take several steps. First of all, I would have insisted on the development of the company’s official websites, designed specifically for the needs of the customers. This website must allow them to book apartments via Internet. This will enable them to better schedule their work.
In their turn, the customers will find it more convenient to work with Canyon Ranch. As it has been mentioned in the case study, customers have to use paper-based system in order to sign-up for fitness classes or outdoor sports. This system has long become dated and Canyon Ranch should substitute with a new digital version.
This strategy will allow them to reduce circulation of documents and make the processes less time-consuming. Finally, prior to the development of new IT systems, I would have conducted surveys among the employees and customers. The recommendations of these people can prove very valuable for the company.
Applegate L Austin R, & Soule D. (2009). Corporate Information Strategy and Management: Text and Cases. McGraw-Hill Irwin.