SCS – Nov 2020 – L3 – Golden Onyx Hotel Management Challenges
- Level: Level 3
- Series: NOV 2020
- Case Study Tags: Business Strategy, Corporate Governance, Ethical Conflicts, Expansion Project, Financial Projections, Hospitality Industry, Market Development, PESTEL Analysis
Summarized Case Study
Cheetah Investments Limited (CIL), operating under the brand name Ghana Golden Onyx Hotel (GGOH), faces various strategic and financial challenges as it seeks to expand and strengthen its market position in the competitive hospitality industry. Established in 2016, GGOH provides services ranging from accommodation to conferencing and fitness, targeting both international and domestic clients. The company’s mission and vision aim to establish it as a leading destination in Ghana, focusing on delivering unforgettable customer experiences.
Key issues explored in the case include corporate governance challenges, particularly the decision not to appoint a managing director, which raises concerns about leadership and ethical governance. The board composition and alternating chairmanship model between shareholders also pose potential conflicts that could impede effective decision-making.
The financial challenges are underscored by a $3.5 million foreign currency loan from ABSTRACT Bank, accrued during the construction of the hotel. CIL is grappling with cash flow issues and an inability to meet financial obligations due to a sluggish start in operations. The company’s financial projections depend heavily on increasing room occupancy rates and expanding facilities, which includes a planned expansion project to add 60 standard rooms and a multipurpose conference facility.
Strategic growth opportunities are analyzed using Ansoff’s Product/Market Growth Matrix, revealing that GGOH could benefit from market penetration and development strategies, especially as competition intensifies in the hospitality sector. The case also discusses transaction risks arising from foreign currency loans and the potential impact on GGOH’s financial stability. Ethical conflicts and integrity in financial reporting are addressed in line with IFAC guidelines.
This case study encourages students to apply strategic analysis tools, assess financial performance and governance structures, and devise solutions for sustainable growth and debt repayment, making it a comprehensive scenario for examining real-world business challenges in the hospitality sector.