Running head: THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 1

The Impact of Changing the Tactic Used In Michelin Stars Ranking System on Hospitality Establishments Name: Glion Institute of Higher Education

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 2

Abstract
La detour and three stars represent an exceptional cuisine that is worth a special journey with the quality of food being rated from the level of luxury. The Michelin rating system being one of the most respected and best known star ranking systems for quality and cuisines of restaurants in Europe as portrayed by Blah Le Guide Rouge (2003, p. 16). This research will evaluate the impact of changing the tactic used in the star rating system used by Michelin, in the hospitality industry, with the aim of advising Alain Ducasse and bring a system which all the sectors in Hospitality Establishments feel accepted and well guided. The respect and extend in which customers value Michelins ratings, may or may not be transferred to the brand of Alain Ducasse. The research will examine the value placed on Michelin rated establishments before and after the rating. Alain Ducasse had two stars in 2009 and three stars in 2010. The management has to decide whether to retain or change the tactic used in Michelin is ranking, after evaluating the effect it brings on the brand of the organization. According to Marylou Costa (2011), industry rankings are highly esteemed in the industry especially in the valuation of performance, and potential of organizations brands. This research will determine whether this statement is true.

Problem statement
The present Michelin star rating system is not fitting in all sectors of hospitality industry. The effect of star rating systems in the hospitality industry bears great uncertainty and has unclear significance. For instance, one would expect a four star hotel to charge more than a three star hotel which are located in the same city, but be surprised to find a contrary reality to these perceptions. The ratings could be influenced by many other unanticipated factors including tax obligations,

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 3 among other quantitative measures, which require research (Martin, 2012). These uncertainties call for immediate research on the relationship between the effectiveness of the rankings and the customers behavior. According to Grossman David (2004), there is a great confusion over the star and hotel rating system, because some facilities are ranked high but provide low customer services while others, which are very efficient, are ranked low.

Research Objectives
This paper aims at studying whether changing the tactic used in the Michelin star rating system, can bring a full accepted system which targets at improving and sustaining services within Hospitality Establishments.
1. The impact of changing the tactic used in the star rating system used by Michelin, in the

hospitality industry
2. To analyze the effect of ranking systems as a strategy for achieving brand promotion in the

hospitality industry
3. Studying both; the rating system and the customers behavior and taking into consideration

the customers viewpoint.

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Research Questions
1. Does the current Michelin ranking system offer the hospitality establishments any chance

of improving their services? 2. Is the Michelin star ranking effective as a driver of perceived value for hospitality products and/or services, and can this be substantiated by the secondary data acquired from GIHE?
3. Can the change of tactic in Michelin star ranking cater for all levels of hospitality

establishments?

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Chapter 2 Literature Review Effect of Michelin ranking system on Hospitality Establishments

The background of the ranking system is quite vast. In order to investigate whether the ranks provided by Michelin have any effect, it is viable to ascertain whether the system is well perceived by customers. From the background of the system, it may be stated that many customers have in one way or another referred to the Michelin guide in the past. Michelin green guides provided a variety of destination information and travel guide including tips for longer trips. The guides can be rated based on the efficiency, organization, and accuracy of the information on art, architecture, restaurant and hotel information (Michelin guides, 2011-2012). The star represents the quality provided by the hotel in terms of amenities and services. Highly ranked establishments are perceived to be providers of high quality. However, it must be determined whether the process of awarding these stars is fair and viewed by the public to be fair. Either way, the customers response will dictate whether the ratings have any effect at all (Blank, 2007). The hospitality ranking system is partially responsible for the growth in the hospitality industry, because of competition between different establishments to meet the requirements for the highest number of stars (Muller, 1999). Ranking systems are only known to be important methods of comparing the standards of different hospitality establishments internationally (Muller, 1999). The ranking system is not focused on improving the organizations services, but as a guide to customers, and an indirect tool for increasing quality services in different hospitality establishments. The management of

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 6 hospitality establishments has to assess whether the ranking system that they endorse, relates to the needs and expectations of their customers. Ranking systems, which fail to influence the behavior of customers, are not essential in improving the position of the organization in the industry.

Consumer needs and satisfaction

Hospitality establishments must understand their consumers behavior in order to satisfy their needs. According to the study carried out by Porte (2004), and Szmigin (2003), the success of any business strategy is dependent on the extent to which it meets perceived consumer satisfaction. Unfortunately, the influence of the ranking system does not reach all consumers. This makes frequent travelers to be well acquainted by the ranking systems compared to casual travelers. In addition, customers at the three basic levels of the hierarchy will be influenced well only by the price level and less by the level of quality (Noone et al 2007 and Sonchong and Namkung, 2007). Satisfaction from meals may form just a segment of the overall vacation of such customers (Atila and Fisun, 2003). Hence, customers who value esteem and self-actualization need more than the basic levels and will be enticed by the quality of services more than the price levels. These type of customers use the hospitality guide and Michelin stars ranking system to get an establishment for their vacation. More so, they will prefer to make a statement by separating themselves from the crowd (Gupta et al, August 2007). For instance, a sales person may want to entice a potential client, or a politician who wants to make a statement or a celebrity who values his/her status.

Consumer Behavior
Since, the correlation between brand promotion and star ranking systems greatly depends on the behavior of consumers, the consumer reactions may emanate from psychological, physical, or emotional influence. However, the most important element is ones memory with the success of many brands having resulted from consumers free promotion. For example, a customer who

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 7 remembers a bad experience from a restaurant will not repeat such an experience, and tries to inform others about his/her experience. In such a case, the ranking of the establishment will not avail much (Zaltman 2003, p. 186). According to Bagozzi (2002, p.132), both the conscious and subconscious of the consumer affects their future decisions. The owner of the restaurant should not underestimate his/her customers memory, because it will shape their predetermined judgment about the quality they are likely to receive from the establishment (Zaltman et al, 2002, p.68). Furthermore, the memory of a past experience will prevent the promotional attributes received from the ranking from taking effect, after the negative assumption spreads through the informal setting, developed by the consumers.

Branding strategy and the Consumer

The Michelin ranking system offers recognition for only hospitality establishments, which leads in business, and the ranked establishments brand, in the mind of the consumer (Johnson et al., 2005). Only to those hospitality establishments, which have an advantage, as those ratings are not permanent and offers them an open opportunity to enforce measures that will enable them reach their ideal rank, while leaving smaller business left out (Grimes, 2005 and Hickman, 2008). With the use of Michelin ranking system, consumers relate some brands to specific attributes with that depth of association in the mind from consumers not be easily altered (Haig, 2004, p.78 and 85). For instance, McDonalds can automatically be related to the image of cheap, fast, and variety of food or burger. The Michelin star system has created the image of quality in the consumers mind, which indirectly neglects smaller and upcoming hospitality establishments hence bringing discouragement amongst most of them. More so, this quality has been branded the

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 8 image of high prices, which also creates an image of beyond the bounds of affordability in the minds of consumers (Surlemont et al., 2005). Nevertheless, some like Porter (2004) argues that the differentiation of quality and prices provides room for several competitive advantages, especially for consumers at the higher level of the hierarchy. Zaltman (2003, p.227), also supports this view by stating that differentiation enables satisfaction of consumers needs through decision-making process as influenced by peers. The Michelin ranking system may get affected by peer influence as manifested in the hospitality industry. Other studies indicate that consumers consider the connection towards certain groups and segments of people. For instance, people may dine in a specific restaurant just to make a statement about the consumer group that they belong to.

Restaurant recognition
With Michelin ranking system, many hospitality establishments recognize and value the Michelin star system. Those with low ratings cannot hide their disappointment, while those with higher ratings express their joy (Elliot, 2008). This response indirectly affects the behavior of consumers. According to the Michelin Guide (2008), the Michelin rating system makes a difference in some sectors in the industry with only restaurants which receive the rating often aspire to use the system, as a marketing tool for improvement against rivals in the industry. This competition is characterized by the commitment to offer quality food, enhance style, and increase luxury status (Willan, 2007).

The Michelin Star rating system

The Michelin guide was first introduced in France in 1900, with the original intention of assisting drivers with travel advice (Johnson et al., 2005). By 2005, a million copies of this guide were sold in eight countries. Restaurants that need to be included in the guide were to be visited

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 9 and their meals judged before they were added. According to Michelin, the visits by inspectors show a great level of independence than other guides, because no advance notice is issued to the restaurant before inspection (Balasz, 2001). Over 70 inspectors operate around Europe, and have more than five years experience in hotel and catering industry. The stars can be added or removed from an establishment as per business changes. The Michelin star rating system may have a substantial number of critics but still carries authority in its processes. However, to some extent, it can be identified as a brand on its own and it is easy to recognize, and having a clear and well-understood identity and definition with the desirability of the star emanates from its pursuit for quality using anonymous but qualified judges. Michelin stars convince in its guide (2008), that their ratings are used by hospitality establishments for a competitive edge, just like FMCG (fast moving consumer goods) brands uses the seal of approval to gain a USP (unique selling proposition) and be ahead of their competitors (Costa, 2011).

Competitive advantage
Researchers such as Yuksel and Yuksel (2003), Johnson et al (2005), and Balasz (2001), present mixed views about the relevance of Michelin star system. According to Yuksel and Yuksel (2003), a study of the system in Japan revealed that it fails to take into consideration the people factor. These authors indicate that it does not consider the main quality satisfaction and reliability attributes, which are responsible for causing repeat visits to the establishment by the customer. However, Bagozzi et al., (2002), also pointed out the importance of consumer satisfaction during the study of consumer behavior. They indicated that the impacts of the system would be evident once the procedures incorporate the consumer behavior, in terms of satisfaction.

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 10 Theoretically, the star is presumed to offer an establishment, the competitive edge against rivals that does not guarantee profitability, which makes it a short-term venture. According to Surlemont and Johnsons (2005, p.589), studies indicate that some establishments are accredited with stars which do not merit their position. This raises several questions over the quality and reliability of the system. Moreover, since the system has no structured measurement process, the awarding of stars is the discretion of the inspectors. This means that any flaws by Michelin inspectors could cost innocent establishments their competitive advantage. It also increases risks of competitors illegally manipulating inspectors, in a bid to get ahead of the competition. Based on the previous argument, the establishments with the best cuisine may suffer loss against those with luxurious settings in case the ratings affect the competitive advantage of the establishment. However, the ability to issue and withdraw stars places the establishments on toes to either get one more star, or maintain the number of stars acquired. This ideology frames the competitive advantage theory. Alain Ducasse rating on the Zagat is better than the rating from the Michelin system. This indicates that the two rating organizations apply two different approaches. Competitive advantage may thus be dependent on the system used, rather than the quality available.

Overview of the literature

Many authors continue to discredit the attributes of Michelin rating system as a marketing tool due to the lack of clarity and low value emanating from its ranking (Satran, 2011). According to Wells (2003, Para. 7), the system recently has concentrated on luxury at the expense of cuisines. He insisted that questions have risen on whether Michelin has reliable indicators for the quality metrics that it purports to measure. A few researchers support this argument by stating that the

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 11 system is only applicable to the higher level of customer needs (self actualization and esteem needs), and does not in any way influence average customers. Some customers perceive the influence of the Michelin system to be closely related to the environment of the restaurant and the pricing strategy, as opposed to delivery of consumer service satisfaction (Snyder and Cotter 1998). Contrary to these opinions, employees and owners emphasize that the system has a broad impact on the strength of the establishments brand (Balasz, 2002). They argue that consumers rely on the assurance of quality offered by Michelin rating system.

Chapter 3 Research Methodology

The data from secondary sources indicate that the application of Michelin rating system has spread across many countries. This data includes the star rating for restaurants, Hotels, and Bib Gourmand around the world. Alain Ducasse operates in a diverse sector of leisure and tourism, in terms of the number of market players and the underlying business models applied by them. From the data collected from secondary sources, Michelin covers a total of 4,500 hotels and restaurants (Hickman, 2008). Many of these establishments fall below the one star rating, and decline upwards. The narrow path between two stars and three stars leaves many establishments fighting for a place in the highest rank. The research on this industry reveals that the nature of the industry influences the need for the higher rating status. Empirical data on the leisure and tourism industry for this study is obtained from external stakeholders including academic journals, newspapers, and regular surveys.

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 12 The research design was not solely build on the research design of primary sources because of the size on the industry, and the amount of time available for the research. Furthermore, the costs involved in carrying out interviews and filling questionnaires would be very prohibitive. Moreover, a careful exploratory investigation on the data field revealed that for this specific study, secondary data would be more applicable, because of the availability of extensive coverage (Punch, 2008). In order to control the element of bias, the databases from various sources were compared on their view about the relevance of the Michelin system, alongside those with a contrary view. The sources were analyzed to determine whether a relationship between consumer behavior, branding, and consumer needs, showed any correlation with the ranking system provided by Michelin. The research was undertaken from the UK database, in order to reduce the number of factors, which might distort the results. The Michelin guides receive competition from other rating organizations in the UK. The two of these rivals that are worth noting include AA Rosette system, which has a significant base in the UK, and Zagat. Some sources imply that AA Rosette is a more advanced rating system than Michelin especially in terms of measuring quality. AA Rosette system applies a five-star system as opposed to Michelins three stars. Zagat originates from France like Michelin and has a rating system that is based on an aggregation of unpaid individual consumers (Gobe, 2002, p.139). Although Michelin argues against Zagats approach, terming it as being unprofessional, it continues to increase in popularity as it affects consumer behavior and choice.

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The reaction of the Industry towards Michelin

A survey of 791 restaurants that are Michelin ranked, that was conducted by Johnson et al (2005), in eight different countries showed that France had the highest number of stars, having 25 of the 32 three-star establishments, 62% one-star restaurant, and 67% of two-star restaurants. The database on the financial success from such ratings is still inconsistent. Balasz (2002) suggested that having a star from Michelin could not necessary boost the organizations financial success. Likewise, Johnson et al (2005) added weight to these findings and claims that in his research, there was no indication of higher profits after a higher rating. He however, admits that the Michelin star had an impact on the revenue of the organization. Although the Michelin star could increase the organizations revenue, insignificant difference was reflected on the establishments profitability. Moreover, Balasz (2002), in her research found out that Michelin ratings had a negative impact on chefs. She mentioned that chefs approach their work with sacred obsession, having the role of both a businessperson and creator at ago (Balasz, 2002). The chefs greatly value the rating, with a craving of being awarded a star for their craft of culinary creation. Gordon Ramsey has various hospitality establishments that have the most number of stars, namely 12. He could not hide his delight when his Manhattan based restaurant was added to this elite club. He emphasized that the recognition showed the customer value and quality offered to customers (Video link, 2008). Some U.S food critics did not support Michelins opinion on several occasions, branding the food that has been rated as leathery, overcooked, rubbery, or a distinct disappointment. However, some of American chefs supported Michelins ratings and pointed out that it was important to their business (Petkanas, 2006). More so, there are some of the owners of restaurants, who indicated that they observed profitability in their businesses after being starred by Michelin (Petkanas, 2006).

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 14 Positive responses was only reported to owners of large Hospitality Establishments, with similar survey conducted in Holland and Netherlands where only 53.84% of restaurateurs considered growth after being included in the Michelin guide. Other category of people constituting of only 30.77% of those surveyed agreed that the guide offered a small platform for direct advisements towards the consumers (Gehrels et al 2006, p.51). More so, some of the renowned chefs, who have been highly rated by Michelin for quite some time, joined the criticizers wagon, stating that they prefer their own standards. Some of these defectors include Alain Senderens of the Lucas Carton Restaurant from Paris and Landanis from London. Despite being in the three star level of the Michelin system for three decades, renounced his inclusion and preferred a personal approach of increasing profitability levels. The chefs argued against Michelins approach, stating that it ignored the essentials for consumer satisfaction. They also expressed their concerns over the costs required to achieve a star status (Petkanas, 2006). The star system has been categorized by many consumers, as an inter-chef rivalry, with little benefits reaching the consumer. The process of this rivalry leads to increased food prices. Although Michelin is highly accredited in France, it is losing its appraisals in London and has no strong backing in Japan (Frackler, 2008). Some chefs in Japan turned down the offer to be ranked under the star system, arguing that the inspectors lack knowledge, of the local culture in Japan. Many concerns arise about the transparency of Michelin systems. The development of the Michelin system in New York had serious concerns of bias. All restaurants awarded the three stars status had French cuisines or were being run by French chefs. For instance, Alain Ducasse was run by Alain Ducasse, Vongerichten was run by Jean-Georges, and Le Bernadin was run by Eric

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 15 Ripert. Many competitors exclaimed this to be because of unfair measurement of standards (Elliot, 2008). In 2005, a restaurant in Belgium was rated as Bib Gourmand before it even opened for business (BBC News, 2005). The validity of the inspections was further discredited when a serving inspector wrote a book admitting that there was bias towards certain chefs. These chefs were guaranteed a three star rating regardless of the inspection results. He further explained that the number of inspectors delivering the services were not enough (BBC News, 2005).

Data Analysis
A dual approach of data analysis becomes effective, because the first stage correlates the performance of the Michelin rated establishments after a higher star and before receiving the star. The second stage involves the evaluation of the relevance and practical application, of the theories studied under the literature review.

The reaction of consumers towards Michelin

The Michelin star system concentrates on the quality end of the market. The chefs compete on achieving the perceived quality, leading to a similar experience. Therefore, the element of choice is very limited in the eyes of the consumer segments. Yuksel asserted this in his Japanese research, stating that there are five different customer segments with each having different expectations (Yuksel and Yuksel, 2003). The consumer seems to be drifting away from the habit of responding to information that is provided by professional sources. According to the research conducted by Polesz (2004, p. 317), the modern consumer relies on a variety of sources other than professional opinion.

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 16 The consumer behavior has changed significantly, in terms of how consumers make decisions. Poleszs research signifies that the modern consumer is not likely to select the opinion of other consumers on social sites or elsewhere, than concentrate on professionals view. Zagat seems to be having an edge against Michelin for this reason. The hospitality industry has seen major expansion with increased leisure and social activities and the outburst of the internet. Zaltman determined that the degree of trust between consumers is greater than that of a consumer and a professional organization. This leads to the argument that the relevance of Michelin could be deteriorating (Zaltman, 2003). Consumers perceive the role of restaurants to be the satisfaction of their needs (Bagozzi, et al 2002). This means that restaurant owners must customize their business to exhibit sufficient differentiation, in an attempt to lure consumers to prefer their establishment to others (Muller, 1999, p. 401). According to the research by Yuksel and Yuksel (2003, p. 52), consumers have different levels of purchasing determinants. Hence, the value of quality and satisfaction is measured differently by different consumers (Zaltman, 2003).

Chapter 4 Findings and Discussion

It is without question that authors have conflicting opinions over the value of Michelin star system as a tool for boosting Hospitality Establishments. (Johnson et al, 2005, p. 589). In general, even though Michelin has been in use for some time as a guide to travelers and as an advisor to consumers, it has been viewed as a tool, which portrayed uncertainty towards Hospitality Establishments profitability. Consumers, who are indifferent about the place to spend their vacation, may have no choice when locating a function or where to spend while on business as the

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 17 Michelin guide remains to be the only efficient tour advisor. Similarly, to those only in the higher bracket of the hierarchy of needs value it with the method of tracing Hospitality Establishments favorable to well rated and likewise best placed for tourism and visits only. The Michelin star ranking system may currently not be much favorable as the modern business environment continues to be more competitive with organizations capitalizing on every opportunity no matter how small, to outdo their rivals. On the other hand, the Michelin guide has more than 50,000 eating establishments, which are positioned for information purposes with only 5% of these establishments being selected for special cases (Johnson et al, 2005). According to Elliot (2008), most critics of the Michelin system include those restaurant owners or chefs of establishments that are lowly rated or on the waiting list. He adds of owners restaurants who sharply criticize the publication of the Michelin guide for being in the waiting list for long (Elliot, 2008). He argues it has been a behavior, which is seen as a way of expressing disappointment, and instead of being against the impact of Michelin as a promotional tool; it actually approves it because of the value placed on it by the owners. According to a research by foods standards agency, a majority of restaurants felt that the rating system was not a favorable idea with fewer participants having responded that consumers never took note of the ratings (Hickman, 2008). This makes the relevance of Michelin stars system with no enough evident to bring changes in the hospitality industry. As a promotion tool, it is applicable in two main areas. First, it is a means of exposure to the world. Secondly, it customizes the type of customer for the business, because of the price range. Some consumers argue that the Michelin star ranking system can be used as an advertisement tool bearing the value placed on it by the owners. However, many of these

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 18 establishments have the limitation of when it comes to market penetration because they have limited appeal to other consumer segments that lack the finance. This greatly hinders any growth strategies. Research also indicates that maintaining the amount of workload and profitability is more difficult for rated establishments compared to those, which are not rated (Petkanas, 2006). Entities that were initially advantaged for possessing the star seem to be losing the promotional attribute, due to changes in the consumer behavior. Thus, in order to maintain the Michelin brand, the rating system must be updated to take into account all stakeholders opinion, but most importantly, to consider the aspect of consumer satisfaction. The promotional brand for holding a Michelin star is also diminishing because of the transparency issues and errors/ weaknesses in the internal processes of the system about hospitality establishments.

Conclusion
The current market trends indicate that consumer behavior is drifting away from the traditional methods of depending on professionals, and is more inclined on consumers interests. (Polesz 2004, p. 335). The choice of consumers is influenced by many factors other than Michelin ratings (Bagozzi et al, 2002). Some consumers find the formal approach of reports used by Michelin quite offensive. Having a star may not be profitable as it is often purported to be. The star system is a good means of spurring competition in the hospitality industry, but does not accrue the essential benefits to the consumers, due to the resultant high prices, and an egregious violation of some cuisines, like was the case in Japan (Frankler, 2008). The numerous adverse opinions from different sectors continue to raise questions on the future of this rating system. Despite these negative impacts, Michelin rating system can still have a few impacts on the rated establishments due to the number of restaurant owners and chefs who still fight to be ranked

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 19 by it. However, a complete change of the tactic within the star rating system used by Michelin has to be applied. The research also indicate that most of hospitality establishments continue to decline their operations and profits with their struggle to be rated. More so, it reveals that the current rating system in Michelin cannot be trusted by many hence Alain Ducasse ought to apply new systems which can be trusted by many and fit all sectors of hospitality establishments. The study concentrates on the value of the Michelin rating system as a promotion tool in marketing Alain Ducasse. It takes into account various relevant theories including quality and competitive advantage, business branding, and consumer behavioral patterns (Porter, 2004). The approach of understanding the needs and expectations of consumers is the first step in viewing the whole theory, from the consumers perspective. However, a question of whether it is still relevant to hold a Michelin star cannot be confidently answered, this research clearly shows that the star has minimum relevance in the hospitality industry compared to its reputation of twenty years ago. It can only be a good promotional brand as an international standard for measuring cuisines and an aid for chefs to enhance the transition of their brand in the external industry. However, it is not too relevant as a promotional tool for hospitality establishments that have average consumers of the lower bracket in the hierarchy of needs and in the general market sector, because it is industry focused instead of being market focused.

Recommendations
Alain Ducasse must revisit the corporate strategy to clearly establish its market place and the segment of consumers who visit the establishment. It should go through the consequences of pulling out of the system by focusing on the attributes that its competitors gain from the system. Most importantly, the profitability of the business must be compared with the costs of having a star

THE IMPACT OF MICHELIN STARS RANKING SYSTEM ON HOSPITALITY ESTABLISHMENTS 20 using the cost benefit analysis. Alain Ducasse must remain consumer focused and be viewed by the public to be so.

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