Blue Mountain Resort Case Analysis
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Introduction
On December 2, 1999, Dave Sinclair vice-president of human resources at Blue Mountain Resorts was looking at furthering his service quality program by introducing three new proposals to the company executive team on Monday December 5th. Blue Mountain had been using the service quality program for the past nine years, and has improved their service rated by the customers every year. The three proposals that Dave is reviewing are ways to enhance the customers experience at Blue Mountain Resorts by making it easier to navigate and reduce stress. As Dave analyzed the three proposals he saw that they were a very logical continuation of the service quality program that he had begun. Dave decided that he was going to recommend to the executive board that all three proposals be systematically implemented, using a priority system.
Overview
Industry
17.3 million Skiers and Snowboarders visited Canadian resorts in 1999; this was a 12 percent increase of the year before. Blue Mountain is located in Ontario which captures approximately twenty percent of this market. Though the Ontario area is serviced by around 60 private and public resorts, there are five major resorts that primarily serve this area. BMR holds an eighteen percent market share. This business is very dependent on the weather, which has forced many of these resorts to become year round properties.
Company
Blue Mountain Resorts were founded in 1941 by Jozo Weider, and run by his son-in-law Gord Canning. In the 1980s BMR became a year round property by adding a four star resort hotel, conference centre and Monterra Golf course. In 1999 the winter sports still accounted for approximately sixty-five percent of total revenue. Blue Mountain offers their winter customer 251 acres of ski-able terrain and a vertical drop of 721 feet. To support all these ski runs they have fifteen lifts. To keep up with trends and what the customer is looking for, BMR has special facilities for snowboarding, and has installed lights on 11 trails for night skiing. In 1999 Blue Mountain had is second best year in terms of attendance, with 415,920 visits. For Blue Mountain to run efficiently is a very labor intensive. The first touch point for most customers is the call center; this is where reservations, directions, tee time, equipment rental and questions are answered. The facility has eight food service facilities, a conference center for large meetings, three retail shops, a day care facility, and three rental and repair shops. To keep the ski runs at their peak, they have to groom them every day, and make snow when needed. BMR has also implemented a number of systems to help skiers while at the resort, including electronic message boards to inform guest of open lifts and waiting times in line. BMR also has mountain guides on the slopes to help answer questions, along with ski patrol to also help answer questions and for medical assistance. With all these different operations working simultaneously together, it was easy to lose track of the number on goal which is servicing the customer. This is exactly what Dave Sinclair came upon when he first joined Blue Mountain in 1991. At this time BMR had developed a reputation for long line and poor service. This is when Dave started to implement the Service Quality program. In taking the focus off revenue growth and facility expansion and had to redefine what value they wanted to give the customer. The measurement they used on this was benchmarking off customer surveys that they received, and giving the staff bonuses for improving the scores. As the process continued, Dave changed the hiring process to include front line staff, so to build better work teams. As the Service Quality Program continued to show improvement, Dave realized that they had enhanced the basic service that they were giving to their customer, but they were not “wowing” their customer. BMR needed to take it a step further and make the customers experiences exceed expectations.
Customer
The Blue Mountain Customer is comprised of 20 percent beginners, 40 percent intermediate, and the balance is advanced to expert. An intermediate skier comes to the resort an average of 4.1 times a year, while advance and expert customers comes an average of 6.7 and 9.4 times a year. Out of the 15 different packages that BMR offers, the three most popular are weekend individual, midweek individual, and full season pass. Approximately 60 percent of BMR visitors came from the Greater Toronto Area, while the rest come from the US and other area of Ontario.
Stakeholders
The stakeholders in this decision process are Dave Sinclair, the executive board of BMR, Gordon Canning, and Intrawest investment group. For the Quality Service Program to continue, Dave and the executive board have to be working together. Gordon as CEO, of the company has to make sure that his resort is continuing to improve and move forward. Intrwest bought a 50 percent share in BMR in January, and has plans to expand the resort in the future. Intrawest has hundreds of millions of dollars invested in Blue Mountain. These are the stakeholders that would be affected by the current decision.
Analysis
Factors for Picking Resort
The first step in the process of evaluating the proposals is to obtain a great knowledge of the industry. It would be important to first find out what the customer is looking for when they pick a resort. The five main factors that were found to influence customers decisions on picking a resort were, location, cost, quality of the runs, speed and capacity of lifts, and amenities offered. (As seen in Appendix A) This is a very good starting point because it begins the understanding of what Blue Mountain Resorts need to improve on. We need to look deeper into this issue. For this information to be extremely relevant, it would be helpful to know what importance each factor plays in their decision. This will give Dave Sinclair a way to prioritize what he needs to focus on first.
Observing Operations
At this point it would be very important to go to Blue Mountain Resorts on my own to see exactly how all the working parts move separately and together. Since the decision does not have to be made until after the weekend, it is a great opportunity to observe BMR during one of their busier times of the week, the weekend. Along with observing the different operations that are going on during the day, it would also be a great time to talk