Hello, I need to write the Micro Environment part and Macro Environment part about the Tatev Revival Project caseHere is the case study below and written case analysis from previous team. Please based on these two files. But do not copy paste!
TATEV REVIVAL PROJECT W14789 TATEV REVIVAL PROJECT Rashid El Ayoubi De La Fuente, Raghid Nami, Marwa Hachem, Ralph Khattar and Tamara Zeidan wrote this case under the supervision of Dr. Marina Apaydin solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. This publication may not be transmitted, photocopied, digitized or otherwise reproduced in any form or by any means without the permission of the copyright holder. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Ivey Business School, Western University, London, Ontario, Canada, N6G 0N1; (t) 519.661.3208; (e)
[email protected]; www.iveycases.com. Copyright © 2015, Richard Ivey School of Business Foundation Version: 2015-06-04 On June 13, 2013, Ruben Vardanian stood by his office window in Moscow, Russia. He was trying to organize the feedback he had just received from his assistant, who had accompanied a team of strategy students to the historic town of Tatev, Armenia. The undergraduates from the American University of Beirut (AUB) in Lebanon had spent a week at the site, methodically observing and analyzing the conditions there with the goal of developing a strategic plan and sustainable business model. Before 2008, Tatev and its ninth-century monastery were largely inaccessible to the outside world due to their remote location and the absence of appropriate transportation. Only about 10,000 locals visited each year. However, Vardanian, a prominent businessman of Armenian origin, decided to change this situation, and built the longest cable car connection in the world. Accessibility was replaced by attractiveness as the main obstacle. Romantically named “The Wings of Tatev,” the cable car reduced the travel time across the gorge to reach the monastery from many hours to just a few minutes, thus opening the site to the world and increasing the number of visitors seven-fold within a short period. Several groups of stakeholders began to show interest in the development of the site. However, each group had very specific goals and interests that did not always overlap. As Vardanian stood in his office, a phone call cut his thoughts short. Arman Khachaturian, the managing director of the National Competitiveness Foundation of Armenia (NCFA), told him that an Armenian Church official had contacted him regarding the project. The Church was concerned about what it perceived as plans for the commercialization of Tatev. When Khachaturian tried to explain that the project did not merely entail commercialization, but also regional development with the involvement of the United Nations Development Program (UNDP), the Church official expressed the Church’s desire to return Tatev to its status of acting monastery, and even referred to an international agreement related to United Nations Educational, Scientific and Cultural Organization (UNESCO) policies regarding religious heritage. Tatev had become an intricate balancing act. On the one hand, Vardanian had to please every stakeholder, while on the other he wanted to fulfill his dreams and place the historic town at the forefront of tourist destinations — not only within Armenia, but the entire region. “What middle ground can I find that all parties will concede to?” he wondered. “How can I devise a strategy which would address all For the exclusive use of D. KRAT, 2021. This document is authorized for use only by DARIA KRAT in HOS6133 W2021 taught by ZAINUB IBRAHIM, Algonquin College from Jan 2021 to Jun 2021. Page 2 9B14M151 stakeholders’ interests without compromising my own principles and ethical values and still be commercially successful?” OVERVIEW OF ARMENIA1 Armenia is a landlocked country extending over 29,700 square kilometres of mountainous terrain, with an average altitude of 1,800 metres above sea level. The country has borders with Georgia to the north, Turkey to the south and west, Azerbaijan to the east and southwest, and Iran to the south. A map of the country is included in Exhibit 1. Historical Background2 Armenia was one of the first nations to formally adopt Christianity in the early fourth century. Over the centuries, however, different empires ruled the region including the Romans, Byzantines, Arabs, Persians and Ottomans. Armenia had long been in conflict with Azerbaijan over Nagorno-Karabakh, a region that was primarily an Armenian region, but was allocated to Azerbaijan during the Soviet reign in the 1920s. The fight between Armenia and Azerbaijan for this region broke out in 1988 and escalated further after both countries got independence from the Soviet Union in 1991. Both economies had been hurt by the countries’ inability to work toward a peaceful solution. Armenia had remained a democratic republic since its independence in 1991. However, because the Nagorno-Karabakh conflict remained unsettled, Armenia was left out of a number of regional projects. In 2008, Armenia’s population was approximately three million people, with a yearly growth rate of about 0.11 per cent. Two-thirds of the population was clustered around urban areas, while the other third still lived in rural communities. Even though Armenia had once been the cradle of Armenians, 10 million Armenians had spread around the world, mostly to the United States, Europe, Russia and the Middle East. Macroeconomic Environment3 Armenia is geographically isolated, meaning it could only trade with two of the states bordering it — Iran and Georgia — as its borders with Azerbaijan and Turkey were still closed as a result of ongoing disputes. Furthermore, Armenia had been particularly reliant on Russian private and government support, so most Armenian infrastructure was either owned or managed by Russians, especially in the energy sector. Given Armenia’s geographical isolation, low export levels and monopolies in significant business sectors, the country’s economy had fallen behind the global economy and followed the recession caused by the dissolution of the Soviet Union in the early 1990s. However, in the late 2000s the situation started to change. Following a strong economic liberalization program between 1995 and 2005, economic growth in 2006 (13 per cent) and 2007 (14 per cent) was exciting for investors. Gross national income per capita reached US$6,340 in 2008, up from $5,760 in 2007. But a drop to 7 per cent in 2008 kept capital-holders cautious.4 Furthermore, there were international concerns about the stability of the Armenian economy; nearly 20 per cent of GDP was produced in a single industry (construction) in 2008, which increased to 30 per cent in 2009.5 This, among other factors, affected the exchange rate of the national currency, the Armenian dram (AMD). One U.S. dollar was worth as much as 455 AMD in 2006, but hit an average of 306 AMD in 2008.6 For the exclusive use of D. KRAT, 2021. This document is authorized for use only by DARIA KRAT in HOS6133 W2021 taught by ZAINUB IBRAHIM, Algonquin College from Jan 2021 to Jun 2021. Page 3 9B14M151 Following the Global Financial Crisis in 2008, Armenia experienced a sharp, 14 per cent contraction in its GDP. The plummet was largely attributed to a major slowdown in the construction sector, coupled with lower remittances (primarily of Russian origin), despite extensive financial efforts on behalf of various multinational institutions. Towards the end of 2010, growth was returning with figures as high as 2.1 per cent. This positive momentum continued well into 2011, with a peak of 4.6 per cent, before growth levels averaged out around 4 per cent. Since the momentous GDP increase, the national currency, the Armenian dram, experienced a severe depreciation, falling by nearly 15 per cent.7 The most recent economic indicators published in 2013 can be found in Exhibit 2. Culture8 Historically, Armenians had valued their artistic traditions that mirrored the country’s unique culture and landscape. Their creativity extended to several crafts, where everyday elements were expressed in sewing, embroidery, carvings and design. One of the most attractive art forms in Armenia was architecture. Churches, for example, presented artistic illustrations in frescoes and reliefs. Nearly every city, town and village in Armenia contained sculptures. The land was considered an open-air museum where tourists could discover more than 4,000 historical monuments, ranging from prehistoric to Hellenistic times and from the early to medieval Christian era. Yerevan alone had more than 40 fine arts museums and galleries. Many of the Armenian masterpieces had been produced in the few periods of peace and relative prosperity during Armenia’s history. THE CONCEPT OF HERITAGE9 “Heritage” represents valued objects and qualities such as historical buildings and cultural traditions that have been passed down from previous generations.10 It may be recognized at different levels: national, regional and global. For example, a monument may be unique within a country, but on a global level there may be many monuments of the same or higher historical value. A heritage site derives its value through one or a combination of factors including natural wonders, ruins (i.e., the remains of building or structure), engineering marvels, etc. When heritages sites are also of national importance, and a government agency takes it upon itself to register them, they are considered to be “national heritage sites.” At this point, the same government agency can open the sites to the public and advertise them via tourist bureaus as part of the country’s tourist attractions. UNESCO’s broad reach had resulted in many countries acknowledging that their national heritage extended beyond simply being important to the nation, and that the sites were important on a global level. As such, they had to recognize that improper care, usage and restoration might destroy value — resulting in the removal of the site from the list of World Heritage Sites.11 The preservation and protection of heritage