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Ford 2001-Lessons From Hospitality That Can Serve Anyone

Ford 2001-Lessons From Hospitality That Can Serve Anyone

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Organizational Dynamics, Vol. 30, No. 1, pp. 30 – 47, 2001 © 2001 Elsevier Science, Inc. www.organizational-dynamics.


ISSN 0090-2616/01/$–see frontmatter PII S0090-2616(01)00039-0

Lessons From Hospitality That Can Serve Anyone
he hospitality industry has long known that the difference between success and failure is the successful management of the service experience for all guests. If you want people to come back to your restaurant, hotel, airline, or theme park, you had better keep them not only satisfied with the experience you offer but “wowed” with what you do. Given the variety of people in the world and the intangibility of the hospitality “product,” this is a major challenge. Organizations like Marriott International Inc., Southwest Airlines Co. and the Walt Disney Company theme parks find ways to create memorable experiences consistently. People remember these experiences as being so much better than those offered by competitors that they come back time and time again. These benchmark hospitality organizations must know something that all organizations, service and otherwise, can use; they must be doing something right from which all organizations can learn. While many factors contribute to their success, these exemplars of hospitality have three keys in common. What they do is no secret. The service product they offer, the setting in which they offer it, and the systems that deliver it are out in plain sight for anyone to observe. Unfortunately, too few organizations bother to pay attention or even look. Although any organization can do many specific things to improve its service, the benchmark hospitality organizations have found three keys to service success: • Make every decision with the customer in mind,


• Build a strong culture of service, and • Manage each “moment of truth” in the service experience. This article will talk about each key and how it leads to service success.

Successful hospitality organizations know that they must make every decision with the customer in mind. Modern managers in other fields will tell you that they also follow this principle, but they really don’t. Most organizations have a tendency to look at the world from their side of the cash register. Decisions on capital investments, facilities design, system design, and managerial policies and procedures are too often made from the organization’s point of view and convenience rather than the customer’s. Consider a bank that sets up its lobby so that long queues of people in front of unmanned teller terminals are created, an insurance company that invests in a major structural upgrade while ignoring employee training, a retail store that creates awkwardly difficult product-return procedures, or a health maintenance organization (HMO) that is rude and unresponsive to its members. In each of these situations, customers are left wondering why any organization would behave in such a fashion if its future success and profitability depend upon satisfying, if not “wowing,” the people it gets inside the door. The benchmark hospitality organizations have learned that they can’t succeed if

from Princeton University and M. His recently published text.A. He has a B.D. In addition. Ford (Ph. he has co-authored three books: Principles of Management. He currently is a Fellow of the Southern Management Association and the associate editor and editor-designee of the Academy of Management Executive. Cherrill P. programs at UNF. His texts include Principles of Management: A Decision Making Approach and Organization Theory. is a compendium of hospitality-based concepts important in managing any service organization. he is the co-author of Essentials of Modern Investments.B. Formerly a stockbroker in Miami and Wall Street. Heaton is professor of organizational communications at the University of North Florida. Managing the Guest Experience in Hospitality. health care and related service management topics.D. Ford.Acc. Organization Theory. In addition to teaching organizational and business communications in the M. books.Robert C. He joined UCF in 1993 as chair of the Department of Hospitality Management after serving on the faculty of the University of North Florida and the University of Alabama at Birmingham. he has been the chair of the Accreditation Commission for Programs in Hospitality Administration and president of the Southern Management Association. With Robert C. degrees from Florida State University. and presentations on organizational issues. and Ph. and guest services management.A.A. human resources management. and M. Ford has also been an active professional serving the Academy of Management as director of placement and the division chair for both the Management History and the Management Education and Management Development Divisions. and Managing the Guest Experience in Hospitality. he has taught over 100 short courses for business and industry in these subjects.-Arizona State University) is currently associate dean for graduate and external programs and a professor of management at the University of Central Florida’s College of Business Administration. SUMMER 2001 31 . He has authored or co-authored over 100 articles.

and more. They survey guests continuously and train their guest contact employees to check with guests about their experience every chance they can. because what management thought would be keys when it designed the experience don’t turn out to be so from the customer’s point of view. enjoyable. and behaviors of their guests. This difference between what the organization delivers and what the customer expects or really wants is the “service gap” that Len Berry has identified. Other benchmark guest service organizations study their guests as well. expect. Then they deliver it. they think of customers as their guests and treat them accordingly. That manager’s responsibility is to eliminate flaws and reduce work-cycle times by 50% in the systems that deliver the 18 keys leading to customer satisfaction. and what their key drivers are. Disney studies how 32 ORGANIZATIONAL DYNAMICS long a wait can be before guests become unhappy. The company may often have to dig below the surface to find out what customers really want. more is required than just being nice to people. The Ritz–Carlton Hotels used customer surveys to identify 18 key drivers. They go out their way to make their guests comfortable. but it isn’t. Southwest quickly recognized that. Organizations must keep working and studying until they know what customers actually expect. to acquire feedback on the quality of the experience in a structured. Mystery shopper programs are another way of finding out if you met their expectations and kept your promises. Finding and Using the Key Drivers The best way to keep up with the current drivers of customer satisfaction is to study and survey customers continually. The best hospitality organizations understand that they can’t really know what factors are the key drivers of customer satisfaction and intent to return without carefully studying the wants. as well as what they want. The basic drivers are so important that Ritz–Carlton wants someone in every hotel to be worrying about them all the time. human nature being what it is. needs. The point is that the benchmark organizations spend a lot of time and money to find out what their guests value. and it happens. Ritz–Carlton then hired a process manager for each hotel. great meals. how they actually behave. they have to in order to stay in business. free movies. Even if the guests tell you what is important to them. They seek to measure everything that is important to their guests and manage these key elements thoroughly. The basic drivers may not always be the ones discovered first. if you ask people what they want—they want everything. Disney has even coined the term “guestology” to reflect the importance placed on understanding thoroughly how Disney guests actually behave. systematic way. and what number of drops the runaway elevator in the Tower of Terror must have to satisfy the guest’s quality standards for the attraction. you can’t always find out how well you did simply by asking them. . The benchmark organizations don’t miss any opportunity to talk to their guests and ask them “How was everything?” In addition. Only then can organizations give their customers the experience that they want and will come back again and again to enjoy. they employ trained mystery shoppers pretending to be guests. to help guests derive the maximum value from the experience they have paid for. and to ensure that the experience is as rich. value and expect from the Disney experience. and want. Many times what management learns in such studies is a surprise. what price points are acceptable to guests. These benchmark organizations also work hard to determine the key drivers of guest satisfaction: what their guests want and what will satisfy them enough to keep them coming back. Southwest Airlines surveyed its customers and learned that they wanted cheap fares. need. on-time performance. comfortable seats. This sounds easy. and satisfying as they know their guests expect. Most organizations think they know what their customers want and expect. and to a limited extent they do. Instead.they treat customers this way.

patrons went to the bar because it was a place where everyone knew their name. basically wanted provided extra cost savings to Southwest. They don’t want to put money into parts of the experience that don’t matter that much to customers. Being recognized and ac- . nor do they neglect parts that are truly important to customer satisfaction. the organization may accept them if surveys also show that these ratings have little effect on guest satisfaction and intention to return. more important. The increased emphasis in services on relationship marketing or the “market-segment-of-one” concept has been made possible through the increasing power of computers to store. and cheaper without having to clean up all the mess and clutter caused by unwanted frills like food service. If a component shows a strong statistical relationship to guest satisfaction and return intention. Gourmet meals with wine in big comfortable seats and low fares—it can’t be done. Even better for Southwest. The Southwest product is now exactly what its target market wanted and. Intelligent use of a customer database allows the best to get better at doing these things. fill out the information on cents-off coupons. giving customers what they really. The best hospitality organizations mine these databases to dig up as much as they can about what is important to each guest so they can customize the experience. The idea is to find out so much about customers that the organization can treat each person as a separate “market.” When customers return warranty cards on products.Southwest realized it couldn’t give its customers everything because nobody could. Everyone wants to feel special and be treated as an individual. Computerized databases and sophisticated techniques of database analysis allow the organization to know a great deal about its customers as individuals. So Southwest did additional research to dig deeper into customer preferences and learned that their customers really wanted low fares and reliable schedules with friendly service. Customizing or personalizing each customer’s experience to match the customer’s unique needs and expectations is becoming increasingly easy for all organizations. for example. digest and interpret large quantities of information. and their information systems are designed to provide this extra level of customer service. offer an excellent customer experience partly because they provide their customers with more than a clean SUMMER 2001 33 A Key Driver for Most Customers: Personalize In the TV show Cheers. If one component of the service experience receives relatively low ratings. wanted enough to pay for and to return again and again. they provide information that companies can use to gain a better understanding of their customers and their unique needs. faster. Personalizing the experience is one way to wow customers. The benchmark hospitality organizations. these organizations allocate resources to that component to wow customers and keep them coming back. knowledged as an individual is or can be a key driver for just about every customer. rely on their knowledge of the guests’ key drivers to allocate resources. it is obviously a key driver. on the other hand. Organizations in other industries certainly don’t allocate resources on a hit-ormiss basis. turning an airplane around between arrival and departure is considerably easier. The Ritz-Carlton Hotels. or send in for free premiums such as t-shirts and company-logo coffee mugs. Personalizing Through Computer Analysis: Ritz–Carlton and AMEX Many hotels seek to provide more than just a simple clean room. The excellent guest-service organizations that attract repeat customers allocate significant resources to study their customers extensively and also accumulate the information they have learned. But they often use allocation criteria like internal needs or top management’s preferences rather than the key drivers of customer satisfaction.

hot chocolate. organizations must continually survey their guests. The Ritz–Carlton database tells the hotel what the exact preferences of its guests are so staff can be sure that the desired items are in the room when guests arrive.room and bed. Because what impresses customers now may not be sufficient to encourage their return in the future. but other guest-service organizations have also developed innovative ways to build a relationship with each customer based on powerful computer analysis of customer information. The employees help deliver the wow Ritz– Carlton experience by adding useful information to the organizational information system. know the key . and that the drivers of customer satisfaction today may not work or may be too commonplace tomorrow. if a floor sweeper overhears guests talking about celebrating their anniversary. and the airlines they flew. While personalizing is not easy with a highvolume. the managers of the best hospitality organizations know that 34 ORGANIZATIONAL DYNAMICS making every customer feel special is an important way for an organization to differentiate its customer-service experience. In addition to putting basic demographic information about its customers into a database. and even restaurants. these data-based systems are making it easier for service settings like hotels. and many organizations now have access to the power of building personalized relationships with their present customers and offering such relationships to their future customers. or specific magazines in the room when they arrive. the company also stores information about every customer transaction. They know which stores the cardholders shopped in. Employees are asked to listen for and record in the database any relevant guestrelated information that might assist the hotel in adding value and quality to the guest’s experience. mass-produced experience like a theme park designed to appeal to thousands of customers every day. and—to encourage customers to use their credit cards more— can target specific promotions like weekend getaways on their favorite airline to their favorite city to stay at their favorite hotel. The best hospitality organizations know that success is never final. Like managers everywhere. Amex can infer from the data what is likely to appeal to each customer in the future. The company has dedicated seventy workstations at its decision sciences center in Phoenix to scan mountains of data on millions of Amex cardholders. They know from retained information that certain customers expect to find extra pillows. Information systems and the powerful advances in information technology make it happen. Ritz–Carlton is one of the best. which helps to ensure that all the people involved in providing the guest experience have the information they need to do their jobs in the best possible way. Ritz–Carlton also asks its employees to provide information related to service delivery. to provide individualized customer interaction. the restaurants where they dined. the sweeper is supposed to pass the information along so that the hotel can take some notice of this special event. how often they went. The difference is that these managers aggressively use this knowledge to make their guests feel personally treated. Any organization able to offer this degree of personalized service can make it tough for competitors who can’t provide their customers with similar value. For example. and how much they spent when they got there. The powerful applications of modern information technology provide the employees with the information necessary to satisfy and even wow the customers by personalizing the service experience. Their definition of a properly prepared room includes having service providers check the information system to review items that today’s incoming guests have indicated in previous stays are important to them. American Express Co. may have taken this approach as far as anyone. Amex figured in 1994 that the personalized marketing strategy made possible by this relationship-based information system increased member spending by 15 to 20% in the markets where it was used. the places they visited.

She went to the catering supervisor. the volume level and type of music are pleasing. an airline that purchased food and drink from the SAS catering department. and the people waiting in the inevitable lines have something to occupy them (e. If only a few first-time visitors turn into loyal repeat patrons. It’s not enough for an Olive Garden Restaurant to get people inside their place once. or at least try to. and project the drivers of tomorrow. she decided to offer them free coffee and biscuits. The negative effects on Northwest’s reputation lasted a long time. they ask the question. They also test menus. The location. retail store. the organization’s future is limited. a menu to look over. SUMMER 2001 35 . because according to company policy each flight was allocated only so many cups of coffee and biscuits. They know that unless guests think highly enough of the experience to give it top marks. the product was designed by someone who never asked what the customers wanted. and hours of operation are clearly focused on employee convenience. and the stranded customers received a welcome snack. the SAS purser bought the coffee and biscuits from the Finnair purser with petty cash. they worry about the guests who don’t make a “top box” mark on the guest satisfaction surveys.g. Before making every decision. but to do nothing was contrary to the guestservice culture of SAS. Taking good care of customers stuck in the snow is no small matter. Because the purser knew that an SAS cultural value was to do whatever necessary to satisfy customers. and food quality continuously and extensively. Darden doesn’t do it. During a 1999 snowstorm. bank. the corporate planners or the engineers like something. The purser could have let it go at that. Their mantra is simple: “Everything starts with the customer. it spends countless hours and dollars making sure the distance between the tables is just right.” A STRONG SERVICE CULTURE A second key to service success in excellent hospitality organizations is to build a strong service culture. She noticed that the plane at the next gate belonged to Finnair. a middle manager who outranked her. the designers. they may not be back—and they certainly won’t recommend the place to their friends. An SAS plane with 40 passengers aboard was stuck at an airport because of snow. The SAS purser put service first to achieve the airline’s primary goal: customer satisfaction. The Mantra: “Everything Starts with the Customer” These benchmark organizations know that their long-term success depends upon their guests thinking so highly of what the organization does for them that they will come back again and again.drivers of today. Northwest Airlines left passengers sitting in planes at the Detroit airport for eight hours. medical office. Thus. The point is simple: Benchmark hospitality organizations excel at making every decision with guest satisfaction in mind. Thus. consider the many times you have entered an auto dealership. or a display of tempting appetizers and desserts). Contrast Northwest’s customer service with that of the service-oriented Scandinavian Airline Services (SAS) purser in the following example. and the operational policies and procedures are distinctly userunfriendly. “How will the customer feel about this?” In contrast. The catering supervisor wanted to help but refused the request. the SAS catering supervisor was required by SAS regulations to fill the order. if the guest doesn’t like it. It doesn’t matter if the managers. and asked for 40 extra servings. or other organization that obviously doesn’t spend much time thinking about what it does from the customer’s perspective.. when Darden Corporation designs its Olive Garden restaurants. The SAS purser asked the Finnair purser to order the coffee and biscuits. no matter how uncomfortable or complicated that decision may make their own lives as operators. portion sizes. design.

The organizational culture fills in the gaps between (1) what the organization can anticipate and train its people to deal with and (2) the opportunities and problems that arise in daily encounters with a wide variety of customers. They are “on stage” all the time while they are producing lunches. distracting them. beliefs and norms must be to ensure that the customer-service employee provides the quality and value of customer experience that the customer expects and that the organization wants to deliver. it won’t work. hotel check-ins. Because each customer determines the quality and value of the service experience. Thus. Only that person can tell you if the service experience was a “wow” or an “ow. are different from traditional manufacturing organizations in some fundamental ways. But front-line employees frequently face problems and decisions not covered by their formal training. There is no way to anticipate the many different things customers will do. whether or not anyone is managing it. employees in the hospitality industry—like those in most service industries—not only have to be capable of producing the service experience. One result of this intangibility is that the value and quality of the product are determined exclusively in the mind of the customer. refrigerator. If they don’t make the experience work. the customer’s judgments of quality and value depend on the excellence of the customer-contact employees. beliefs. Additionally. First. Disney magic. defining it or teaching it to employees. In all service industries. The culture must be planned and carefully thought through to ensure that the message sent to all employees is the one the organization really wants to send. What’s even more amazing is that the hospitality guest contact employees producing these consistently outstanding experiences are frequently the same young people whose . and norms of behavior that the culture teaches its employees become critical in ensuring that the front-line employee does what the organization wants done in unplanned and un36 ORGANIZATIONAL DYNAMICS anticipated situations. the stronger the cultural values. or auto in a manufacturing plant.” and whether the experience was worth the time and money spent on getting it. In those situations. The benchmark hospitality organizations create a strong culture with guest-centered values and manage it very carefully because they know its importance. and watching everything they’re doing. ask for. these employees have to fix any errors made in this production process on the spot and appropriately.Culture and the Front-Line Employee Every organization has a culture of some kind. how should the organization concentrate its efforts to make sure each guest has a good one? Almost invariably. the “product” is largely intangible. Good managers know that the values. they have to do so while guests or customers are talking to them. The more intangible the product. even if the organization hasn’t said so. The power of the culture to guide and direct employees to do the “right thing” for the customer becomes vital. An important part of any strategy is to ensure that everything the organization and its leadership says and does is consistent with the culture it wishes to define and support. and expect from the service provider. They can acquire the basis of that excellence in employee manuals and training programs. The skill set required of hospitality employees is considerably more complex than the set required to participate in the production process of a tire. or trips to New York. the people “manufacturing” a service experience are not hidden away in an “authorized access only” factory floor. Service Employees: Always “On Stage” Hospitality organizations. employees must be able to translate the cultural principles of guest service into the appropriate behavior in each situation where they are responsible for making the customer experience work well. and most other service organizations. and there is no rework pile for a bad experience.

on top of having good interpersonal and problem-solving skills. Thus. were getting it. The hospitality product cannot be packaged and put on a shelf for purchase. But the problem is even more complicated than merely training employees to do their jobs. and will be empowered by the organization to do it. who deplaned first. each of whom expects something a little bit different from the experience. If the culture has a strong service orientation. implementing it meant that BA had to change its luggage-handling procedures in airports all over the world. A British Airways baggage handler at London’s Heathrow Airport noticed that passengers waiting for their luggage at the carousel were asking him a strange ques- tion: How can I get a yellow and black tag for my bags? The passengers had noticed that bags with those tags arrived first. and passed it along for development. their luggage was loaded last and unloaded first. It is ever changing and defined anew in the mind of each guest every time it is experienced. while some other passengers were getting first-class luggage service. The baggage handler didn’t take a creative path to solving a customer problem because he had to. Culture. and under 7 min on some routes. First-class passengers are highly profitable to airlines. benchmark hospitality organizations spend considerable time and money teaching a culture value system so that when a guest wants something that isn’t discussed in the training manuals or can’t be done by the book. The baggage handler realized that because the passengers asking him the question were the first ones to arrive at the carousel. and the baggage handler saw that something was wrong with the service being provided to them. and the average time of getting first-class luggage from plane to carousel dropped from 20 min to less than 10 worldwide. and that took time. saw the creative possibilities in a new idea. because no one is smart enough to anticipate and plan for every conceivable desire and requirement that each unique guest will bring to the hospitality experience. so they wanted the special tags.parents can’t get them to clean up their rooms at home. But it was done. He saw a problem. they will report the need for improvement. they will fix the problem if they can. they had to be firstclass passengers. Hospitality organizations have to substitute culture and empowerment (to be discussed later) for command and control. How can any organization create and sustain a culture like this—in which employees not only do their jobs efficiently and competently but also want to go the extra mile? How can such a strong customerfocused culture be created? Two ways suggested by the success of these benchmark SUMMER 2001 37 . The baggage handler’s inquiries revealed that the passengers perhaps least deserving of “first-class” luggage service. the employee who has learned the culture will still know how to do the right thing for that particular guest at that particular moment. Although the idea was simple and had obvious merit. And yet they had to wait 20 min on average for their bags. Because they were the last to board. An employee who understood the BA culture saw a way to improve the system and got it done. and Service Faults People on the front line are often the first to notice or be informed of service faults or failures. The hospitality organization has to serve a multitude of “very individual people” or VIPs.000 and two round-trip tickets to the United States on the Concorde. Here are some examples of how a strong culture has motivated and guided employees to make the right decisions. will want to do the right thing. but because he wanted to. He had no idea he was going to receive a service award of $18. the Front Line. those flying on stand-by. Traditional organizations rely on policies and procedures to ensure proper command and control of the employees producing the products. The baggage handler reported his findings and made a simple suggestion: load first-class luggage last. if not.

These chairs are discreetly substituted for the 38 ORGANIZATIONAL DYNAMICS normal chairs whenever a person of extra girth comes into the restaurant. as well as send a strong message about what the organization values and desires in its employees. American Express creates and maintains a strong customer-focused culture. GA paid a French tourist’s bail so he could get out of jail. and Legends The Olive Garden restaurant uses stories to teach employees the cultural value of service it hopes to communicate. the Olive Garden ordered and placed in each restaurant two Larry Chairs that have no arms. Every organization should capture and preserve the stories and tales of its people who do amazing things. Two customer service people in Florida got money to a woman in a foreign war zone and helped her get on a ship out of the country. telling the Larry Chair story at an opening reveals a great deal about the company’s cultural values and sends a strong message to the new employees about how far the restaurant (and they) should go to respond to and meet a customer’s needs. Needless to say. Tales of “old Joe” and what wondrous things he did while serving customers teach desired responses to customer concerns and reaffirm the organization’s cultural values at the same time. Outstanding guest-service organizations engage all their members in teaching each other the organization’s culture. Southwest Airlines created a “Culture Committee” whose responsibility is perpetuating the Southwest Spirit. but the tales can be embellished in the retelling and the culture thereby made more alive. and to serve as role models for new situations. the opening manager will usually tell a story about a customer named Larry. an employee got up in the middle of the night to take an Amex card to a customer stranded at Boston’s Logan Airport. Members promote the company’s unique. caring culture to fellow employees. They show up in an employee break room with equipment and paint to remodel it. The effort will yield a wonderful array of inspiring stories for all employees. Any organization has its cultural heroes— employees who have gone “above and beyond the call of duty”—and their stories should be preserved and shared. All organizations can use stories. myths. . It’s so much easier to hear a story of what a hero did than to listen to someone lecturing about “customer responsiveness” in a formal training class. One way is by recognizing those employees who have provided exceptional service to customers as Great Performers. to communicate the values and behaviors the organization seeks from its employees in their job performance. Not only are the stories more memorable than some arbitrary five points seen on a classroom overhead. Teaching the Culture Through Stories. He wrote the company president a letter praising the food and complaining about the chairs.guest-service organizations are (1) by celebrating the organization’s service heroes and telling their stories. But the hospitality benchmarks also know that the most important contribution to the organizational culture is the behavior and teaching of its leaders. heroes. an employee drove through a blizzard to take food and blankets to stranded travelers at Kennedy Airport. Employees Teach Each Other Another way to teach the culture is by encouraging employees to teach each other. create magical moments. and legends to help teach the culture. They appear at a maintenance facility to serve pizza and ice cream to employees. Myths. It seems that Larry came to an Olive Garden and found the armchairs uncomfortable for his significantly above-average weight. In response. At new store openings. Heroes. travel agents in Columbus. and (2) by encouraging the organizational members to teach each other the appropriate cultural values. American Express distributes its Great Performers booklets to all employees worldwide. to wow the customer. when the corporate culture is being taught to new employees. Most people love stories.

ployees exactly as they want employees to treat their customers. Herb Kelleher. They put values into action by treating em- . Even today this tradition lives on as all Southwest managers are expected to spend time in customer-contact areas. often costly actions. to get people to spend some time helping employees at other locations where the growth in traffic was overwhelming. Leaders who appreciate the importance of culture spend more time communicating values than they do on anything else. They also created a “Helping Hands” program. reinforcing the values. Ed Schein suggests that the only thing of real importance that leaders do is to create and maintain the organization’s culture. caring. Jr. and they praise the heroes whose actions have reflected worthy cultural values. They are personally involved in service activities. He flies more than 200. Another Southwest effort to promote the culture and the Southwest Spirit was the “Walk a Mile in My Shoes” program. He has been known to get up early in the morning and wander into the Marriott kitchens to make sure the pancakes are being cooked properly. He is famous for dropping in at a hotel and chatting with everyone he sees. opening their doors to all employees and using weekly work-group meetings to inform. The program helped employees understand how their jobs fit together in making the organization work. Managers of effective organizations constantly teach the culture to their employees. This intense commitment to personal contact with each and every Marriott employee and visible interest in the details of his operations have become so well known that his mere presence on any Marriott property serves as a reminder of the Marriott commitment to service quality.000 miles every year to visit his many operations and to carry the Marriott message visibly and personally to as many people as he can. Jr. To instill values. and solve service problems. He is a constant teacher. Other employees can use these hero stories as models for their own actions. provides a good example of how a leader can help to sustain the culture. which encouraged people to use a day off without pay to shadow another employee doing another job.. Strong cultures are reinforced by top management’s strong commitment to the cultural values. They back up slogans with dramatic. inspire. They use rituals to recognize and reward the behaviors that the culture values. and service areas to show employees his concern for the quality of each customer’s experience. and they do it visibly. and laws. planes.. mores. This same modeling behavior can be seen in the many hospitality managers who visibly and consistently stop to pick up small scraps of paper and debris on the floors as they walk through their faSUMMER 2001 39 Culture and the Leaders All organizational leaders are crucial in transmitting and preserving the organizational culture. preacher. both observing and working in customer-service jobs. allow members to teach each other the cultural norms of helping. Southwest Airlines is also famous for this hands-on commitment to service. and reinforcer of the Marriott cultural values of customer service. and Walt Disney Bill Marriott. He believes in staying visible. Bill Marriott. All of these programs have had multiple positive effects for the organization and its employees. and having fun at work. They reinforce the togetherness of the “extended family” that Southwest believes is an important part of its cultural value system.They may appear anywhere at any time to lend a helping hand. The benchmark leaders worship at the altar of the customer every day. Herb Kelleher was the premier example of quite literally walking the walk through airports. and provide a strong visible expression of the cultural values that all employees are encouraged to share. These actions send a strong message to all employees that everyone is responsible for maintaining the high quality of the Southwest experience. they stress two-way communications.

“Mr. In the best guest-service organizations. he had to stay close to both his employees and Disney’s customers. the manager added responsibilities to the position—such as checking periodically to make sure there were enough trays or making sure that the butter dish was always full. hotel managers wander the lobbies to observe the reactions of customers.” Walt was supporting and maintaining the culture. Many a company tells its employees that they should make every effort to satisfy the customer. which can rely on statistical reports to tell managers how things are going on the production line. the reward system gets constant and careful review to ensure that it is supporting and re- . and the employee adjusted his actions accordingly. All these strategies are based on the simple idea that the reason for the organization’s existence and basis for its success is the customer. employees will see that team effort doesn’t really matter that much. and theme park managers monitor the looks on guests’ faces to make sure they are having a good time. Unlike the manufacturing industry. Here is how he described his function within the organization: My role? Well you know I was stumped one day when a little boy asked. But if he ever let the buffet line run out of trays or butter. I go from one area of the studio to another and gather pollen and sort of stimulate everyone. Therefore. the Leader. “sometimes I think of myself as a little bee. managers of these benchmark service organizations inform themselves about how things are going by staying as close to the point where the guest experience is produced as possible. Culture. A popular buffet restaurant decided to add a “greeter” position to welcome customers as they entered the restaurant. The greeter quickly realized that the manager never complimented him for properly greeting the customers. he was strongly reprimanded. and managers from the top down must set the example. The manager made her real priorities clear. Employees see and emulate this care and attention to detail. “I don’t do that. being out with the customers and interacting with the 40 ORGANIZATIONAL DYNAMICS employees who take care of the customers is an important organizational value and not just a company slogan. Disney. Only in walking around can managers see for themselves that the quality of customer experiences is high. as time went on.” I said. Then the company evaluates and rewards employee performance only according to the budget numbers. Many restaurant managers are told to meet every customer and to make as many table visits as possible to talk to them.” Most employees will naturally focus on the budget numbers and not on the customer-satisfaction ratings. This practice has been called “rewarding A while hoping for B. the manager had redefined the job description.cilities. and the Reward System Leaders also teach the culture by what behaviors they support and don’t support.” I said. I guess that’s the job I do. For these benchmark organizations. The manager told the newly hired employee explicitly that his primary responsibility was to greet and welcome the customers. by her actions or lack of action. he looked up at me and said. to keep the employee busy when customers were not entering the restaurant. if the company tells its employees how important team performance is. “Do you draw Mickey Mouse?” I had to admit I do not draw anymore.” Finally. He knew that to do so. Walt Disney was a benchmark of how to teach the organizational culture. just what do you do?” “Well. but rewards its employees only as individuals. that concerns of customers and employees are being met. Similarly. “Then you think up all the jokes and ideas?” “No. and that everyone remains focused on the customer. However. nor did he ever say anything to him when he missed a customer because he was too busy with his other duties.

and seeks solutions rather than scapegoats. Leaders can teach the culture by how they publicize and reward success. on the other hand. They were spending the week in the Grand Floridian. to each and every guest. but that is not enough. nurture. and find every possible occasion to celebrate when the members make good things happen for their customers. tion. Culture makes a tremendous difference. toward the end of their visit. they use these cultural values to guide their behavior and act accordingly. They had saved for some time to come from their home in the Midwest and had planned carefully to make this trip truly memorable. define its values. courtesy. A young family was visiting the Magic Kingdom in Orlando. recognize and tell stories about those who personify what the culture should mean for the customer. They must be enabled or empowered to do whatever it takes to meet and exceed customer expectations. the most expensive resort on the property. reinforce the appropriate norms of behavior. and the benchmark organizations protect. resolves complaints as cheaply and quietly as possible. but it also tells the employees how committed the organization is to customer satisfaction. In addition. makes quick and fair adjustments for failure. for example. One day. Employees need to know that this commitment is more than a slogan. clearly and without equivocation. the father displayed his obviously distraught son and asked the ride operator to look through the cars to see if the ears might be there. they were on the Haunted Mansion ride. managers tell stories about employees who did outstanding things for guests. Whenever employees confront a new situa- . and the little boy in the family lost his Mickey ears during the ride. show. aggressively seeks out and fixes service failures. The management of Hotel B. How the organization finds and fixes its service errors sends a loud message to employees about what the organization truly does believe in. and were enjoying their trip fully. These weren’t just a hat SUMMER 2001 41 The Most Important Job The most important job of the leader may be to frame the culture’s beliefs. this happy experience. Disney employees know that the commitment of the organization to guest happiness and satisfaction is nearly absolute and that they should do whatever they can do ensure the delivery of this service product. as part of their teaching responsibility. If peerless service is important to the leadership and they tell the members so. and teach it whenever they can. teaches each employee the hierarchically arrayed goals of safety. We can predict that the employees of Hotel B will give better service. They can also teach the culture by how they react to service failures. Each employee knows that the first priority is safety. It disseminates findings about complaints and failures to employees. the second is courtesy and so on. The empowered service provider can personalize the service experience to meet or exceed each customer’s expectations and can take whatever steps are necessary to prevent or recover from service failure. At the exit. Disney. of course. customer-focused culture creates employees who are eager to give outstanding service. and seeks people to blame for the complaints.warding behaviors that the organization wants repeated.” but they do not always teach and live the culture with the force and consistency necessary to drive employee behavior. and efficiency. And on those complementary ends can hinge organizational success or failure. the members who believe in that culture will do the right things to make excellent customer service happen. Whether the organization handles service failure well or poorly affects the customers. Employee Empowerment Makes It Possible A strong. Let us say that the management of Hotel A is defensive about customer complaints and keeps them secret (though employees will hear about them). Organizational leaders in all fields know intellectually that “culture is important.

MANAGE EACH MOMENT OF TRUTH The third key to hospitality success is that the successful hospitality organizations make an enormous effort to study. these were his prized possession. to guest satisfaction and organizational success. first. The action cost Disney a little bit of money. and then manage each moment of truth occurring during the guest’s experience. or guest expectations will not be met. triumphantly. purchased on the first day of the visit and worn faithfully ever since. The moment-oftruth concept was popularized by Scandinavian Airline Services’ Jan Carlzon. or wants to substitute one thing for something else. to the customer’s departure from the service setting – each of these and many other points during the experience provide an opportunity to succeed or fail. put one on dad’s head and one. Employees must be empowered to respond 42 ORGANIZATIONAL DYNAMICS now. Organizational willingness to empower the employee to do it will ensure that the employee can match the experience to the guest’s expectations. From the visual appeal of the parking lot. The ears were nowhere to be found. Management got a letter of thanks a few weeks later. and everyone in the organization should be engaged in watching out for failures at the moments of truth. and some may take the organization by surprise. but also well trusted to make the right decision for the guest without requiring time-consuming checks with a senior manager for approval. each moment of truth.to this little boy. some that occur only occasionally can be prepared for. Guests want their problems solved and their needs met now. identifying the potential and actual moments of truth during the time that the typical customer interacts with the organization providing that experience is relatively easy. went across the walkway to a souvenir stand. If one considers any customer experience in this way. to evoke a “wow” or produce an “ow. The ride operator looked. of the number of separate interactions that customers had with the airline and all the different components of the airline experience and.” The goal should be to fail no customer. and positive word-ofmouth advertising more than made up for any lost revenue. If the Magic Kingdom employee had not been empowered to go grab a set of Mickey Ears for the little boy. The ride operator seized the moment. If the guest asks for special service. The benchmark hospitality organizations have confidence that “culture will fill the gaps” at such moments. The ride operator had absorbed Disney’s guest-focused culture and had also been empowered to take any reasonable action necessary to achieve guest satisfaction. but this one simple act by a truly committed employee made the trip memorable for this family. complains about a service error. on the boy’s. Some of these moments can be known or predicted and can be managed. the family would have returned to the Midwest unhappy. Training and culture teach the employee what to do. the guest contact employee must know what to do and be able to do it. but the payoff Disney earned in good will. took two Mickey hats. customer satisfaction. and the operator watched as hope died in the little boy’s face and the father’s concern grew. the crucial importance of each interaction. to the way in which the employees greet customers. The benchmark hospitality organizations know the crucial nature of these contact points and study them continuously to ensure that they . to the cleanliness of the restrooms. employees have to be not only well trained. understand. The benchmark organizations give their employees the training and latitude to make those responses. who used it to make his employees aware. The family spent a lot of time and money at the theme parks. Clearly. Employee empowerment is essential in hospitality because situations occur so frequently in which the employee must make a decision on the spot about what to do for the guest to produce a wow or fix a problem. and guests will go elsewhere in the future. second.

possibly in the form of a fishbone diagram. the percentages of late meal deliveries associated with each cause are listed next to the cause in their order of importance. and procedure. All of the comments we have made about the importance of the organizational culture are relevant to the people part of the moments of truth. Another approach to planning the experience is to use analytical models. Once they have identified the key drivers of their guests. Further analysis of the “unavailable elevator” fishbone revealed that because not enough sheets were being stored on each floor. That problem would become the spine of the fish in the diagram. and so on with each of the four areas. If studies show that service failures are more likely at one moment of truth than the others. Or perhaps the organization needs a detailed blueprint defining every component part and activity of the experience. tested. Let us say that hotel guests are complaining about having to wait too long for room-service meals. they are the ones with whom customers usually interact at key points. These employees typically start the day with a smile on their faces. A simple flowchart of the activities associated with the service experience might do. say. What at first appeared to be a personnel problem turned out to be a material problem. organizations obviously try to hire people who fit the culture and have a desire to serve. The analysis might reveal that. In addition. role plays and structured scenario simulations can help employees practice handling different moments of truth. they plan the entire experience so they can be sure that the key drivers are present. every time. typically but not always computer models. the organization determined that most late deliveries happened because room service personnel could not find an available elevator promptly. to analyze the causes of faulty service outcomes. Using a technique called Pareto analysis. In this example. Times can be attached to the activities to serve as measurement standards. Fixing the sheets problem fixed the room service problem. material. On a simpler level. they search out employees who love people and enjoy helping them. Then the general areas within which problems might arise that could delay the delivery of meals are attached as bones to the spine. Moments of truth at which service failure is most likely to occur can be identified on the blueprint and early-warning mechanisms included. One method of planning and analyzing the experience is to put a service diagram down on paper in as much or little detail as is helpful. Having such employees helps because so many moments of truth are customer/server interactions. The People Part The plan of the service experience can be studied and “fail-safed” in hopes of making it work the way it’s supposed to work. All of the possible contributors to an equipment failure then become bones attached to the equipment bone. Four typical areas might be equipment. personnel. flawlessly. The organization can then analyze a wide variety of different situations that might occur to see what impact each might have on the customer. to simulate the guest experience.are all well managed and that each moment of truth will be a positive one for the customer. Planning the Service Experience One way in which the outstanding hospitality organizations ensure the success of these moments is to plan every detail of the entire service experience thoroughly. and measured. Careful analysis of each contact point in the plan will reveal where problems might occur so they can be anticipated and avoided. 90% of all late meal deliveries were caused by only three or four of three dozen possible causes. and that all the details of the experience are understood. the organization can use cause-andeffect analysis. taken from life. housekeepers were making inordinate use of the elevators to go floor to floor to find extra sheets. But only the organization’s people can make it work. and they pretty much stay that way regardless of the vagaries of human nature SUMMER 2001 43 .

Finally. and completely understood by employees. guests probably won’t either. training. and appropriate measures of what guests expect at the different moments of truth. Understanding that you can’t manage what you can’t or don’t measure. fair. Employees must of course be trained well and continuously in their job skills. should be able to fix the problem fast and fairly without senior manager involvement. in the best circumstances when the measures of guest expectations and employee performance are clear. and because every failure is a moment of truth. they will be able to measure for themselves how well they are doing. Organizational studies may reveal that guests want the phone answered in no more than three rings. Edwards Deming quality-circle movement that anchored the quality-improvement literature and efforts in totalquality management. To tell employees in measurable terms what guest expectations are and how well they are being met can be extremely helpful. If employees are not feeling and acting positive. that a service standard has not been met (whether the guest noticed or not). The motto should be. and problem-solving techniques. anger or provoke less guest-oriented people. fair. reinforces. The benchmark hospitality organizations find excuses to celebrate success.” The guest contact employee who knows that a failure has occurred. Indeed. Preparing for Failure A final point when managing moments of truth is to be prepared for failures. so that both the employees and the guests have an enjoyable experience. won’t wait patiently in line for more than fifteen minutes. or a room upgrade in the hotel if a standard is not met. so everyone needs to pay attention to it. The organization must also create a job environment that promotes fun. and expect eye contact and a smile from employees coming within ten feet of them.they encounter that might annoy. No organization wants to fail. Measuring what is happening to the customer in every step of service delivery is critical in understanding where the problems are and whether the solutions being tried are actually fixing the problem. interpersonal relationship building. because they are going to happen no matter how good the plan and the people. All organizations use measurements and standards to some extent. They understand that what gets measured gets managed. and promotes guest service excellence. “I want you to do a better job of satisfying customers because your customers seem unhappy” doesn’t give much guidance. Self-management through self-measurement is a fundamental premise for the W. “Fix failures fast and fairly. they know that such celebration rewards. these organizations work hard to reward people for service excellence. a coupon for a free dessert. and rewarding the employees who provide the experience. the benchmark hospitality organizations measure all aspects of service delivery conscientiously and consistently. These guest expectations then become specific measurable goals or targets that employees can use to manage themselves. Attention to measurement tells 44 ORGANIZATIONAL DYNAMICS everyone that meeting or exceeding standards is an important determinant in the success of the guest experience. But the benchmark hospitality organizations know that they can end up much better or . they know they should offer an apology. Saying to a service provider. Because the organization has taught employees what and how to measure. The Importance of Measurement In addition to planning or blueprinting the experience and effectively hiring. If the phone isn’t answered in three rings or the line wait exceeds 15 minutes. the benchmark hospitality organizations also seek to define specific. then a service failure is signaled that prompts remedial action by the employee without waiting for the guest to complain or a manager to intervene. and all organizations want to recover when they do fail. The benchmark hospitality organizations understand the statistical relationship between positive guest experiences and positive guest-contact employee attitudes.

Speedparking is often used at theme parks. Its parking attendant. If the lines get too long for the regular front desk team. they make you a new set of keys for free! Even though key problems are not its fault. a moment of truth occurs. The wait for service and the customer’s reaction to it comprise a moment of truth in many service organizations. the organization earns the gratitude and future patronage of customers and enhances its reputation. the attendant pulls out the list of what sections were parked at what times. Leading organizations prepare for these moments so they can help to correct them with sensitivity. Any organization that seriously reflects on what really happens to its customers when they storm out of the store because of a poorly handled purchase transaction. the cars line up and park in successive spaces. In seconds. Each row is filled before cars go to the next row. Disney prevents a customer-caused failure that could have ruined the day’s experience. depending upon how successfully they can recover from failure Here is an example of an organizational procedure designed to help customers avoid failure at a potential moment of truth: finding the car in a crowded parking lot. the extra person reduces the possibility of error even further. is it what the guest ordered? If not. The Opryland Hotel in Nashville cross-trains some of its employees so that they can be called upon in peak demand times when the front desk is extra busy. Even though the traditional job description for wait staff includes this checking responsibility. In this way. where a lot of cars are arriving across a broad time window. If the wait is so long as to annoy the customer. these organizations even find ways to fix problems they didn’t create so that angry. or write an angry letter to the computer manufacturer because their power supply keeps cutting off. Under the direction of a parking attendant. To help a family that can’t find the car. That way customers leave feeling good about their overall experience and appreciating how the organization’s personnel helped them redeem themselves. it keeps all cars facing the same way and in line to park in the next available space. a service failure occurs. Disney has a way to handle this problem. To overcome this very human tendency. prepared for this moment and perhaps even looking forward to it because it provides an opportunity to wow you. the customeroriented organization believes that the customer needs to be wrong with dignity. calls the park’s “Auto Patrol” to your rescue. When customers first stream into the parking area. Imagine how depressed you would feel if the parking attendant guides you and your large family to your lost car on a hot day. to catch discrepancies before the customer ever sees the order. this “swat team” staffs extra computers to reduce the wait for the incoming or departing customers. By providing this high level of customer service. A moment of truth in the food service business is the moment when the guest looks at the food as it is served. We have already shown how speed-parking can help customers find lost cars. When the customers themselves make a mistake that could lead to an unsatisfactory service experience. Disney has a way to handle the problem. frustrated people leave feeling good because a bad experience has not been allowed to overshadow or cancel out all the good. Hard Rock Cafe prevents failure at this moment of truth by hiring an extra person to stand at the end of the food preparation line to match the order with what’s on the plate. should spend some time considSUMMER 2001 45 . then uses the list to locate the car. If a departing family shows up lost and uncertain as to where their car might be. the Disney parking attendant writes down the time each row is filled. leave an auto dealership unhappy because they can’t get their defective tires replaced. Benchmark hospitality organizations know that customers who are angry at themselves may transfer some of that anger to the organization. a service failure results.worse off than they were before the moment of truth. The attendant asks the family about what time they arrived at the parking area. then you find that you have lost your car keys and are locked out of your car. This parking method is fast.

and hope quality control catches all their mistakes. Give customers what they want instead of what you think they should want. They will then be at least satisfied and possibly “wowed. and worse yet. these lessons can be applied. This is a hard lesson for many in the more traditional business sectors to really believe. build a strong service culture. CONCLUSION These three points—make every decision with the customer in mind. These are the competitive advantages of outstanding hospitality organizations. Unhappy customers don’t come back. or house. Too many organizations set themselves up for their own convenience. they may set up a web site and tell the entire world about their unsatisfactory experience. and manage the moments of truth—are a large part of what makes the best guest service organizations the best. To order reprints of this article. An old saying in hospitality is true in any industry: If you don’t give customers what they want. shirt. They should instead be seeking to implement these key lessons from hospitality and trying to listen more systematically to their customers to understand what they really expect from the product or service. listen to their engineers instead of their customers. refrigerator. or open a stock market account. your competitors will. and they work very hard to sustain them. set up a bank account. Then. please call 1(212)633-3813 or e-mail reprints@elsevier.” They will return again and again to spend their money with you instead of with your competitors. and they can be keys to improving any organization that serves the customer. Whether a customer is seeking to buy a car. build a culture where everyone believes in providing service excellence. or get a loan or flu shot. and then manage every moment of truth so as to provide the best possible experience for customers.ering the lessons that hospitality organizations have already learned well. These three keys can become competitive advantages to organizations in just about any field. but the successes of the benchmark hospitality organizations provide a convincing argument that emulating what they do is worth a try. they can organize themselves to deliver this product or service as seamlessly and effectively as possible.com 46 ORGANIZATIONAL DYNAMICS .

The relationship between employee satisfaction. “New Tools for Achieving Service Quality. Flowcharting the service experience and the fishbone technique for problem solving are described in D. W. Managing the Guest Experience in Hospitality (Albany.” Sloan Management Review 39 (1998). Fottler. and profits is discussed in James L. 166 – 172. 9 –11. The story of the British Airways baggage handler and the yellow and black tags is from Alan G. Tax and Stephen W. 61. The Service Profit Chain: How Leading Companies Link Profit and Growth to Loyalty. 1996). Bowen. To read more about service failure. 1988).” Organizational Dynamics 21 (1993).” Academy of Management Executive 9 (1995). For information about planning and blueprinting to help ensure the success of the service experience. Lynn Shostack and Jane Kingman–Brundage. Friedman (Eds. see Edgar H. Jan Carlzon’s Moments of Truth (New York: Ballinger. A compelling discussion of the link between employee satisfaction and customer ratings of service quality can be found in Benjamin Schneider and David E. 1987) provides a detailed explanation of that concept and how Carlzon used it to rejuvenate SAS. “How to Design a Service. see Robert C. Brown. TX: Bard Press. and Value (New York: Free Press. story illustrating the importance of the leader in defining and sustaining the organizational culture is from Albrecht. 21–28. 78 –91. and Leonard L. The Southwest Airlines Culture Committee and the Walk a Mile in My Shoes program are described in Kevin Freiberg and Jackie Freiberg. 39 –52. Schlesinger. Schein. 2000). Heaton. printed for Walt Disney Theme Parks and Resorts. For more on organizational cultures. “Empowerment: A Matter of Degree. Ford and Myron D. The Walt Disney “pollen” quote appeared in Walt Disney: Famous Quotes. Discovering the Soul of Service: The Nine Drivers of Sustainable Business Success (New York: The Free Press. Berry. “Recovering and Learning from Service Failure. Organizational Culture and Leadership: A Dynamic View (San Francisco: Jossey– Bass. guest satisfaction.). 124 –125. see G. Earl Sasser. 1999). see Robert C. SUMMER 2001 47 . 1992). Robinson and Sam Stern. At America’s Service: How Your Company Can Join the Customer Service Revolution (New York: Warner Books. The AMA Handbook of Marketing for the Service Industry (American Marketing Association. 243–261.” Cornell Hotel and Restaurant Administration Quarterly 25 (1984). Nuts! Southwest Airlines’ Crazy Recipe for Business and Personal Success (Austin. 1991). The information about the Amex database and relationship marketing is from Business Week.. 1994. For more on empowering employees. NY: Delmar Publishers. “The Service Organization: Human Resources Management Is Crucial. and Leonard A.” in Carole A. Ford and Cherrill P. 5 September 1994. see Stephen S. At America’s Service. 1997). 75– 88. 1997). 130. Heskett. Jr. The story of the SAS purser and the snowstorm is from Karl Albrecht.SELECTED BIBLIOGRAPHY For more on making decisions with the customer in mind and treating customers like guests. Jr. Congram and Margaret L. Daryl Wyckoff. Corporate Creativity: How Innovation and Improvement Actually Happen (San Francisco: Berrett–Koehler Publishers. Satisfaction. The Bill Marriott..

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