MIS Report on Galloping Hill Golf
Course/KemperSports
MGS 3040*05 GROUP 2
Mike Williams
Tad Walsh
Mike Petruzzella
Nick Santangelo
Erik Supardi
INTRODUCTION
The object of this report is to find out as much information we can
about the management information systems implemented at Galloping Hill golf
course by the KemperSports group. We will also look at the business
strategy that is being used. As a group we will then use our knowledge
gained in this course to analyze and come up with possible improvements to
these systems.
Galloping Hill Golf Course sprawls across 271 acres in Kenilworth and Union. Characterized by its natural terrain of rolling hills and valleys, the course often referred to as "The Hill", has a reputation as one of the most challenging courses in the area. The 18th hole course features 6680 yards of golf from the longest tees for a par of 71. The course was designed by Willard G. Wilkinson and opened in 1928. Most recent renovations were completed by Stephen Kay in 1998.
Galloping Hill also offers an additional 9 hole practice course, a brand new driving range and has under construction a state of the art Learning Center. The Learning Center will be the most advanced in the area, staffed with PGA professionals and containing state of the art video instructions.
The recent overhaul of Galloping Hill can be attributed to KemperSports, which began managing the course and Learning Center in January 2010. They are leaders in the field of golf course management and bring a wealth of knowledge that will constantly improve the complex. The final phase of construction is 40,000 ft clubhouse.
KemperSports Business
Strategy
INDUSTRY ANALYSIS
In order to properly assess Galloping Hill and KemperSports business strategy it is important to understand the golf industry. Our group chose to use Porter’s 5 forces model to illustrate where they stand in this industry. Understanding the bargaining power of customers, rivalry, bargaining power of suppliers, threat of substitutions, and threat of new entrants will help us identity and advise them on potential problems with their business strategy.
The bargaining power of the customers is
high in the golf course management industry. There are a limited amount
of golf enthusiasts in the area, and this number remains pretty constant
regardless of what the courses do. This means theses customers chooses
which courses to play at based on a number of factors. It is important
for Galloping Hill to keep its prices in line with other courses, while
maintaining the course to the highest level. The recent upgrades made to
the course are an example of the customer’s power in demanding top of the line
amenities.
On the other hand, the bargaining power
of suppliers is low in this industry. KemperSports manages hundreds of
courses across the country and has long-standing relationships with all of its
suppliers. They are such a big client that it is in the supplier’s best
interest to keep them happy and offer reasonable prices.
The threat of new entrants is very low in this case. It costs millions of dollars in start up money to build a golf course. In addition, this area of New Jersey is very densely populated and a golf course requires many open acres of land. There simply is nowhere to build a new course in the area. It also requires a great deal of expertise to design a course.
The threat of substitutions is a small issue that Galloping Hill faces. There are other courses in the area that golfers could choose to play at. However, most of them are country clubs that are extremely expensive. The other courses are privately owned and operated. This means there is no government funding which raises the price to play. Galloping Hill and Ashbrook and the only 2 county courses in Union County and they are both operated by KemperSports. They offer county residents substantial discounts as well as lower starting prices. This gives Galloping Hill a huge competitive advantage over the competition. For these reasons, the threat of substitutions is not high.
We believe that the rivalry force is high
because the few courses in the area are all competing for the same
clientele. Although Galloping Hill is able to offer lower prices, many
golfers put price secondary to the quality of the course. This creates an
atmosphere where all local courses are trying to upgrade and improve to gain a
leg up. The addition of a brand new driving range and state of the art
learning center has given Galloping Hill a big competitive advantage for the
time being, but they must continue to improve to stay on top.
Taking Porter’s 5 Forces into consideration KemperSports had to come up with a competitive strategy for Galloping Hill. It appears as though they use a hybrid strategy because they are competing in such a unique business. Overall, we categorized it as low cost focus because they offer the lowest prices within a particular area of New Jersey. However, we also noticed that within the last few years they have tried to differentiate themselves by upgrading the course and facilities to be the nicest in the area. For these reasons, we determined it to be both low cost/differentiation with a focus on a particular segment of the market.
Force
|
Strength
|
Reason
|
Bargaining power of customers
|
High
|
Courses must keep customers happy to ensure return
business
|
Bargaining power of suppliers
|
Low
|
KemperSports has long standing relationships with
suppliers
|
Rivalry
|
High
|
The few Courses in the area are constantly competing
|
Threat of substitutions
|
Low
|
There are only 2 public courses in union county
|
Threat of new entrants
|
Low
|
Many entry barriers, extremely high startup cost and
limited land availability
|
INFORMATION SYSTEMS
Running a golf course requires the use of certain information
systems. Since KemperSports manages hundreds of courses, including
Galloping Hill, they have worked hard to find the systems that can help them
streamline their operation and make it very customer friendly. Since they
took over management 3 years ago they have used three different information
systems, finally finding one this year they feel is ideal. Problems that
they faced in the past couple of years was a sever silo effect resulting in
lead to a lot of channel conflict and duplicate information. There were
different systems in place for sales, tee time sheets, customer information,
and email blast capabilities.
After analyzing their problems, they
decided to implement a system that made it easy to track customers, sales, and
other demographics. They used Galloping Hill as one of the first courses
to start using a new system that is called EZ Links. It is a point of
sales system that keeps track of all of these things. They then use
Microsoft Access to connect and integrate demographics, sales, how often you
play, what else you purchase when you play, and automatically sends out email
alerts for special deals and announcements. EZ Links also allows golfers
to easily make tee times online and the course is able to accommodate more
customers every day. Since all of these systems are now integrated into
one CRM information system the silo, effect is no longer a problem at Galloping
Hill.
In order to expand
their reach to more golfers Galloping Hill has teamed up with TaylorMade, which
is one of the largest golf apparel companies in the world. They are the
sponsors of the state of the art learning center that was just
built. TaylorMade has a huge customer base throughout the country that
will be attracted to the motion capture technology that the learning center
offers for buying new clubs and improving your game. This will attract
people from beyond the union county area to visit Galloping Hill because there
are only three other such learning centers in the nation.
Recommendation/ Solutions
Since taking over management of Galloping Hills KemperSports has worked to streamline their information systems. They have been successful in implementing new systems and driving up attendance at the course. However, after analyzing their business strategy and where they fit in the marketplace our group has identified several ways in which they could improve. The main problems we focused on were marketing through social media, improving the point of sales system, and improving inventory management.
In
today's world of Internet 2.0 we believe it is vitally important to have
a strong web presence. Galloping Hills has a website and sends out
emails to existing members, but we believe they could benefit from using
other resources. As we learned from Lindsey C. Homes, social media is a power and free tool that can be used to reach a
much wider audience. By simply creating a facebook page and Twitter
account they can open themselves up to a new market. Tweeting about
promotions, discounts, and special events will raises awareness. In our
interview it was apparent that the golf clientele tends to be an older
demographic. Using social media as a way of advertising will be an
effective way of tapping into the younger demographic.
Since taking over KemperSports has been searching for the ideal information systems to use. Because of this they have switched systems 3 times over the past 3 years. They are happy with the point of sales system (EZ Links) they are currently using and it seems to be pretty effective. However, due to the multiple turnover of systems a lot of employees do not know how to use the new technology. New employees are trained after they are hired, but the older workers have been given little to no training since the new system has been put in place. This causes errors to be made and precious time to be wasted while they figure things out. Our recommendation would be to create an employee training program. It is important that all employees are on the same page and know the ins and outs of the programs they are using. This will cut down on the human error factor as well as making the customer service quicker and more effective.
While
building the new state of the art club house Galloping Hills has been
in a state of transition. They have been moved to a temporary clubhouse
with limited space which has forced them to move some inventory to
storage units. Since this has been going on there has been hundreds of
dollars worth of inventory that has gone missing. Our recommendation on
how to eliminate this is to implement a radio frequency identification
system (RFID). This is a simple way to keep track of every piece of
inventory and make sure that none is lost or stolen. This will also be
helpful because they are moving into the new club house which will have a
lot of extra space. When this happens they will be selling a lot of
new products. With this extra inventory it is important to have an
effective way of managing it. For these reasons RFID will be an
important asset moving forward.
Overall
KemperSports has taken many steps in the right direction while managing
Galloping Hills golf course. They have vastly improved the facilities
and are attracting many more customers. It is important that they
continue to use technology to keep things running smoothly. Using
social media will allow them to attract even more customers especially
from the younger demographic. Training their employees to use these new
technologies will make sure their are no errors made. Lastly,
implementing RFID will allow them to manage the influx of inventory
effectively. We believe by making these changes KemperSports can
improve the quality of Galloping Hills golf course.
