Group Number: 7

Leader of group: Mahrukh

Members of Group: Mehrunnissa, Mehrose, Mahrukh, Sidra and Huria
Project: Case study
Subject: Principals of management
Submission Day: Monday
Submission Date: 11/29/2011
Class: BSCS
Instructor: Sir M. Waqas
Institute: Global Institute of Lahore

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Making you say wow

Q: 1:- Using exhibit 3-2 and the information from this case, describe the culture at the Ritz-Carlton. Why do
you think this type of culture might be important to a luxury hotel? What might be the draw backs of such a
culture?

At The Ritz-Carlton, the Gold Standards are the foundation of how they do business. Each of the standards is a key
part of our values and philosophy. As a lady or gentleman, you're a part of something bigger than yourself; you're a
part of the respect, honesty, trust and integrity that makes The Ritz-Carlton legendary. During Daily Line-Up at each
one of their locations they focus on learning and development. They rotate their Gold Standards and focus on one
each day. There are 16 Gold Standards that comprise the foundation of The Ritz-Carlton. They include the Credo,
Motto, Employee Promise, three steps of service and each of their 12 service values. They put a promise to their
employees in writing. They strive to enliven the promise for each other every day. The Ritz-Carlton fosters a work
environment where diversity is valued, quality of life is enhanced and individual aspirations are fulfilled. Ritz-
Carlton Hotel anywhere in the world and guests are greeted not only by the doorman, but also by a number of small,
pleasant surprises. The hotel does not need to ask the name of employer, home address, whether guests want a
nonsmoking room, or if their preference is for foam, non-allergenic pillow. All of this information is obtained
during their previous visit to it. To their delight, the desk clerk greets by name when guests phone for a morning
wake-up call and asks if he would, as usual, prefer breakfast in his room. When they awaken the next day, their
favorite newspaper is outside their door. They didn‘t even have to ask. Indeed, they sense that the hotel staff is
somehow able to anticipate and respond to their every need, providing them with a feeling of satisfaction that comes
from being among people who care about them as an individual. Ritz-Carlton is closing in on the concept of
delivering exactly what they as an individual customer want. They are customizing the hotel experience to satisfy
their unique preferences and those of each of its thousands of other guests. Each day, Ritz-Carlton‘s highly
perceptive staff, carefully groomed through a selective and intensive hiring and training program, discreetly record
on small pads of paper the unique habits, preferences and dislikes of each of its guests. This information is then
transferred into a corporate-wide "guest-history database." Every morning, a fully dedicated ―guest historian‖ at
each hotel pulls up the guest-history files for all the guests who will be arriving that day who have stayed previously
at a Ritz-Carlton, and develops an initial suggestion list of extra touches that might surprise and delight individual
guests. This list and the guest-history data are then distributed and reviewed by department teams to determine what
they think would best add to their guests' experiences. Rita-Carlton guests might not notice these extras, but over
time, they should lead to an overall sense of comfort and warmth that their - 2 - competitors lack the ability to
match. Their well-regarded credo is: ―We are Ladies and Gentlemen, serving Ladies and Gentlemen‖. This is the
beacon they use to recruit, develop, manage and deliver the world class service for which they are so well known.
Twice the recipient of the famed Malcolm Baldrige quality award, the company empowers every employee up to
$2,000 to take whatever action they think necessary make an upset customer fully satisfied. This is not a budget per
employee per year; it is the level of personal authority accorded to each staff member per event. (Reference:
corporate.ritzcarlton.com)
This type of culture is important because it has influence on employees and it is associated with high performance.
There is no casual link between god service qualities. A conceptual model of quality and performance is presented
that provides an explanation of linkage between organizational climate and organizational culture, service quality
customer satisfaction and hotel performance. The Ritz-Carlton Company is the first hotel group to win the Malcolm
Baldrige National Quality Award.
This type of culture prevents employees from trying new approaches especially when conditions are changing
rapidly. The disadvantages for the company itself, concerning their strong culture and emphasis on standards, are the
costs for establishing and maintaining these standards including training and constant development of the methods.
Additionally the extreme internalization of the standards results in an inelasticity and loss of employees‘ personality.
As the implementation of the new service values showed, it is difficult to put new ideas and procedures into practice.
Extreme standardization and an all-embracing service culture automatically result in a number of disadvantages;
however, these have to be seen in relation to the advantages which made Ritz-Carlton known for its service
excellence.(Reference: ―Managing culture diversity‖ by Stephanie Jones)
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Q: 2- What challenges do you think the company faced in changing the culture? What is Ritz-Carlton doing
to maintain the new culture?

While the customer service culture of the Ritz-Carlton had been successful, but the challenge faced by the hotel was
in disconnection between the organizational culture and the national culture. Each hotel aims to create two to one
ratio of internal and external complaints. Internal complaints are made by employees who spot problems in daily
service delivery. By eliminating internal problems, Ritz-Carlton removes the cause of external complaints by
customers. Solving problems before they arise in cost-effecting, once a problem has occurred, there are additional
costs of employee time and hotel remedies. Ritz-Carlton‘s new approach is almost the opposite from what the
company had been doing. Don‘t tell employees how to make guests happy. (Reference: RRG Javalgi, CL Martin-
2006- ―Journal of services‖)

Ritz-Carlton try to do is to marry-up their guest engagement and employee engagement which mean they searching
for and finding the evidence that a great employee results in a great guest experience. To maintain this new culture,
Ritz-Carlton has empowered their employees. There are a few of strategies that Ritz-Carlton used to maintain this
new culture:

Every manager and front line employee will carries a threefold pocket card that bears the title ‗Gold Standards‘ but
is referred to as the ‗Credo Card‘. The ‗Credo Card‘ stated of 12 service value guidelines which intended to help
them in create the secret to attract luxury travelers. The Ritz-Carlton is not alone in create the rules and guidelines to
keep employees focused on company values, however the Ritz-Carlton does stand apart in how it reinforces the
values with every employees, every day. Each day every Ritz-Carlton around the world, employees from each
department will gather to have 15 minutes of meeting known as ‗line-up‘. This daily line-up is to review the guest
experience, resolve issues, and discuss the way to improve the service.

Ritz-Carlton motivating and rewarding their employees, who have exceeded their expectations, surpassed the
highest goal with The Ritz-Carlton Incentive Awards. Managers give out the Gold Standard Coupons to those
employees who are caught meeting the hotel standards for quality. These coupons can be exchanged for weekend
accommodations at the hotel or merchandise in the hotel‘s gift shop. Every quarter, a Five-Star Employee Award is
granted with the winner receiving a five-night stay for two at a Ritz-Carlton anywhere in the world, along with
round-trip tickets for two and US$500 allowance. The Ritz-Carlton trusts their employees and provides them a better
workplace so that they come to work with a smiley face and provide excellent customer service. The story is shared
across hotels in 21 countries which have the power to motivate, influence and strengthen the company‘s vision,
culture and values. There is one family staying at the Ritz-Carlton of Bali, had carried a specialized eggs and milk
for their son who suffered from food allergies. Upon arrival, they found that the eggs had broken and the milk had
soured. Managers and dining staff searched the town but could not find the appropriate items. However, the
executive chef remembered that there is a stall in Singapore which selling the products. So he called his mother-in-
law, asked her to buy the products and fly to Bali to deliver to them, which she willing to do.

Employees who join Ritz-Carlton will have two days of training only about Ritz-Carlton. Employees will have two
days of orientation which includes meals and restaurants and training in meeting rooms, they are treated like a guest.
After that, they will receive 30 days of training from a certified trainer from the department. On day 21, new
employees are asked to give the management feedback on how they can improve their training program for future
training and recertification. Additionally, every employee will get a minimum 130 hours of training every year
which spans training for their department, company culture, language and computer skills. Besides of that, every
employee will also go through annual recertification after they pass written test, role play and interviews on culture
and skill. (Reference: case study of principles of management)

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Q: 3:- what kind of people do you think would be happiest and most successful in this culture? How do you
think new employees learn culture?

A person with an outgoing personality and the person love to interact with people. This can be fun. It will like piece
of cake the way to implement these culture it to let people new hired know do what necessary to make the guests
happy. Someone that is truly caring about others and is not afraid to be a little unorthodox about treating their
patients and understands that if they want we know that psychologist learn about human behavior through their years
of training and prescribe no medications, but can ask the GP of the patient to put them on a certain medication.
Culture is transmitted to employees in a number of forms, the most potent being stories, rituals, material symbols
and language.
Stories:
Stories such as these circulate through many organizations. They typically contain a narrative of events about the
organization‘s founders, rule breaking, rags-to-riches successes, reduction in the workforce, relocation of
employees, reactions to past mistakes, and organizational coping. These stories anchor the present in the past and
provide explanations and legitimacy for current practices.
Rituals:
Rituals are repetitive sequences of activities that express and reinforce the key values of the organization — what
goals are most important which people are important, and which people are expendable.
Material Symbols:
When one walk in different business, he feel type of work environment, it is formal, casual, fun or any other. These
reactions demonstrate the power of material symbols or aircrafts creating the organization‘s personality. Material
symbols convey to employees who is important and kind of behavior (for example risk taking, conservative,
authoritarian, participative and individualistic) that are expected appropriate. The layout of an organization‘s
facilities, how employees dress up, type of automobiles provided to top executives, and the availability of corporate
aircraft are examples of material symbols. Others include the size of officers, the elegance furnishing, executives,
employee‘s fitness center or onsite dining facility and reserved parking spaces for certain employees.
Language:
Many organizations and units within organizations use language as a way to identify members of culture or
subculture. By learning this language, members attest their acceptance of the culture and, in so doing help to
preserve it. The following are examples of terminology used by employees a Knight – Rider Information, a
California based data redistributors: accession number (a number assigned to each individual record in a database),
KWIC (a set of key words-in-context) and rational operator (searching a database for names or key terms in some
order). If you‘re a new employee at Boeing you will find yourself learning a whole unique vocabulary of acronyms
including: BOLD (Boeing online data), CATIA (computer graphics aided three dimensional interactive application),
MAIDS (manufacturing assembly and installation data system), POP (purchased outside production) and SLO
(service level objectives. Organizations, over time, often develop unique terms to describe equipment, offices, key
personnel, suppliers, customers, or products that relate to its business. New employees are frequently overwhelmed
with acronyms and Jargon that, after six months on the job, have become fully part of their language. Once
assimilated, this terminology act as a common denominator that unites members of a given culture or subculture.
(Reference: Chapter 3 of principles of management)
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Q: 4:- What could other organizations learn from Ritz-Carlton about the importance of organizational
culture?
Culture can be understood in terms of seven different culture dimensions, depending on what is most emphasized
within the organization. For example, innovative cultures are flexible, adaptable, and experiment with new ideas,
while stable cultures are predictable, rule-oriented, and bureaucratic. Strong cultures can be an asset or liability for
an organization but can be challenging to change. Multiple cultures may coexist in a single organization in the form
of subcultures and countercultures. (Reference: corporate.ritzcarlton.com)
Ritz-Carlton holds the importance learn by other cultures as below

Audio Visual

The Audio Visual department supports the Food & Beverage and Meetings/Special Events departments by providing
audio (sound), light, projection and other services to guests who hold meeting and events at their hotels.

Beach Club

Guests of the hotel enjoy privileges to the Members Beach Club, including use of the Members Spa, within the
hotel, and the Beach Club. The Members Spa features treatment rooms offering a variety of health, wellness and
beauty treatments, a fitness center and a beauty salon. The Beach Club includes a magnificent restaurant, beachfront
pool and whirlpool and stunning views of the coastline.

Casino

A few Ritz-Carlton hotels also operate a Casino. The Casino department employs qualified, experienced people in
positions such as Slot Cashier, Dealers and Table Games Supervisor etc. The Casino is an entertainment facility
where various games involving gambling are played.

Condominium/Residences

The Ritz-Carlton offers condominiums and private residences that may or may not be physically attached to the
hotel. These are beautiful homes that guests purchase and live in for extended periods of time. Hotel services and
facilities are available to the residents, such as service of food and beverages in their home, cleaning and servicing
of their home and access to recreational facilities at the Hotel.

Engineering

Our hotels need to be kept continuously in an excellent state of maintenance and repair for the safety and comfort of
our guests and employees. This department ensures that air conditioning, heating, ventilation, water supply, sewage,
furniture, carpeting, painting etc. are kept in good working condition at all times.

Finance/Accounting

All transactions involving cash, billing, purchasing and other numerical data processing and reporting are done in
this department. This department also assists with the preparation of the annual budgets and the profit and loss
statements and other accounting reports.

Finance Purchasing/Receiving
This department ensures that all the products, food and beverage, equipment and other operating supplies required to
run the hotel are ordered in a timely manner, received, checked and stored until they are needed by the operating
departments.

Fitness/Recreation

This department includes services and facilities to enhance the well-being and health of our guests by offering
Tennis, Golf, Massage, Swimming and a Fitness Center among other activities.

Food & Beverage:

This includes all the restaurants, bars and lounges that are located throughout the hotel.

Golf

Some of our hotels offer golf facilities to our guests. This department ensures that all the guests' needs with regard to
playing golf are met. This includes the management of the landscaping, irrigation, golf buggies, golf retail store etc.

Human Resources

This department ensures the well being of all employees. It also assists the other departments with their recruiting
and selection activities so that they are adequately staffed.

Human Resources Training

Every employee receives an average of 250 hours of training every year. This department ensures that the various
training programs are made available to employees.

Information Systems / Technology

This department ensures that all the computers and computer systems in the hotel are installed correctly and run
properly at all times. This department also ensures the efficient functioning of the telephone switchboard equipment.

Loss Prevention / Security

The Loss Prevention department ensures the safety and security of all guests, employees, their property and the hotel
building and the equipment contained within it.

Meetings & Special Events:

The Meetings & Special Events department is responsible for accurate forecasting of group rooms, banquet food and
beverage and for achieving overall hotel budget revenue.

Quality

The Quality department makes sure that the quality sciences are known and energized by all employees and that all
decisions are made using quality tools.

Retail

Most hotels have one or several retail outlets. These include shops that sell logo items and other sundry items. The
Retail Manager ensures that items are ordered in a timely manner and displayed in an enticing way.
Rooms Division:

Every Ritz-Carlton hotel has a hotel within the hotel, known as the Club Level. Guests staying on these floors pay a
premium and have access to a private lounge with five complimentary food and beverage presentations. The
Concierge department is there to answer the guest's inquiries. The Front Desk or Front Office department checks the
guest into the hotel on arrival; facilitate them as they are in home. This staff of this department answers all in-
coming telephone calls, assists guests with long-distance calling information and provides wake-up calls. Often the
first person the arriving guest sees is the Door Person, who will open the door and extend a warm welcome to guest.
The guests' luggage is brought to and from the room by the Bellman. The cleaning department is charged with
keeping the hotel clean and in order, to include twice daily service of all guest rooms and the maintenance of all
public and heart-of-house areas. Our guests expect the very highest levels of cleanliness when they enter a Ritz-
Carlton hotel. This department plays an important role in meeting this expectation. The department cleans all of the
hotel's linens and terry to include rooms and food and beverage. The Transportation department oversees the parking
garage and also any special transportation needs that a guest might have. The engineer department is responsible for
engineering surprises and anticipating our guests' needs, by pre-calling all guests prior to their arrival to help garner
preferences, identify special occasions and offer additional hotel services.

Public Relations

The Public Relations department ensures that the image of the hotel and the company in the local community is
always maintained at the very highest level. They also make press releases whenever there is something important to
announce and maintain excellent media relations.

Sales Reservations & Revenue Management

The Reservations department takes calls, emails and faxes from guests and makes their room reservations for arrival
at a future date. The Revenue Management department establishes the optimal room rate at any given time, based on
demand and other market variables.

Sales & Marketing

This department sells the hotel and all its services and brings in the guests. Sales people have targets to meet and
their goal is to keep the hotel busy all year.

Spa

The Spa department operates almost like a hotel with a hotel. It offers separate services such as reservations,
housekeeping, front desk and concierge. It may be joined to a fitness center or a Golf Club or a Resort Hotel, and
will operate as a profitable business unit. In addition to the services mentioned above, the Spa department employs
certified massage therapists, nutrition consultants, wellness coordinators, nail technicians, and hair stylists.
(Reference: The luxury touch, spring 2007)

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