Ritz-Carlton’s Core Values & Culture Summary
The Ritz-Carlton’s founders set high standards. Which encourages its employees live these “Gold Standards” through the “Credo,” the “Motto” and the “Three Steps of Service.”
The five principles at the base of The Ritz-Carlton’s well-defined corporate culture have produced an extraordinary level of staff loyalty, unparalleled service, significant customer engagement and brand recognition so entrenched in Western society that words and phrases such as “ritzy” and “putting on the ritz” are part of the English lexicon. The company’s five guiding precepts are:
Principle One: “Define and Refine”
The Ritz-Carlton’s founders created a set of principles they called the “Gold Standards.” Many credit the hotel chain’s long-standing success to its commitment to keeping these standards alive with a creed, a slogan and a service plan that penetrate every aspect of its business:
- “The Credo” – Every staffer carries a “Credo Card” that reads, “The Ritz-Carlton is a place where the genuine care and comfort of our guests is our highest mission. We pledge to provide the finest personal service and facilities for our guests, who will always enjoy a warm, relaxed, yet refined ambience. The Ritz-Carlton experience enlivens the senses, instills well-being, and fulfills even the unexpressed wishes and needs of our guests.”
- “The Motto” – The firm’s slogan is, “Ladies and Gentlemen serving Ladies and Gentlemen.” The old-fashion language conveys the idea that excellent service is timeless, and that staff members and guests should treat each other respectfully.
- “The Three Steps of Service” – The first-rate service at the heart of The Ritz-Carlton’s culture rests on giving each guest a sincere greeting by name, predicting and meeting every need the guest has, and bidding the guest a “warm goodbye,” also by name.
The Ritz-Carlton repeatedly weaves its “12 service values” into its employees’ everyday experiences. Employees follow these service basics:
- Foster close relationships with guests so they always stay at Ritz-Carlton hotels.
Fulfill hotel guests’ wishes, both spoken and implied.
- Use the power the company provides to create memorable guest experiences.
- Become part of the company’s charitable activities, its hospitality and its “mystique.”
- Look for ways to make the hotel and its service even better.
- Assume immediate personal accountability for fixing guests’ problems.
- Work with colleagues as team members to meet each other’s needs and serve guest.
- Capitalize on any chance to learn more and develop professionally.
- Become involved in planning their job’s scope and responsibilities.
- Take pride in how they look, act and speak.
- Protect guests’ and other employees’ private information; be aware of their security.
- Maintain facilities that are safe, accident-free and sparkling clean.
Managers reinforce these values at daily interactive meetings called “lineups.” Employees participate in lineups at the beginning of every shift in every department at every level.
At the lineup, staffers discuss these values, and share stories and information.
Principle Two: “Empower through Trust”
Every new person hired into any job goes through a two-day orientation about the corporate culture. Managers spend three more days learning Ritz-Carlton’s leadership expectations. After orientation, coaches train new staff members in the central aspects of their jobs. The goal is to certify new employees in their positions’ basic competencies by “Day 21.” That day, new hires have the opportunity to discuss openly the positive and negative aspects of their first three weeks. The company marks every employee’s one- year anniversary with a “Day 365” celebration.
The Ritz-Carlton believes in selecting the right people, and providing the mentoring, training and tools they need to create optimal experiences for guests. To that end, the company trusts employees to use their judgment in spending up to $2000 per guest per day to improve the guest’s visit or to solve any of the guest’s problems.
Making Money and Mystique
The company fosters internal transparency regarding the financial aspects of
its business. Staffers can view pyramid graphs of its progress on five different success
scales. The Ritz-Carlton revises and updates these five factors annually. In 2008, they were:
- “The Ritz-Carlton mystique” – Give guests something special to remember. Make the ambience as compelling as possible.
- “Employee engagement” – Encourage employees to take initiative and be creative as part of an effort to hire and keep good people, and help them advance.
- “Guest engagement” – Create personal ties to each guest.
- “Product and service excellence” – Follow the Gold Standards. Set service and location benchmarks and exceed them.
- “Financial performance” – Increase earnings and profits.
Principle Three: “…It’s Always about the Customer and the Employees”
Ritz-Carlton’s executives use a variety of methods to take the pulse of the company’s customers, employees, managers, vendors and stakeholders in a continuing effort to evolve and improve its “customer-reaching” processes. Corporate leaders study other businesses for best practices that Ritz-Carlton might borrow. For instance, in 2007 a senior manager observed how Cisco and Corning nurture innovation, and then helped develop the “Ritz-Carlton Four-Step Innovation Process.” The steps are:
“Inspire vision, foster environment, stimulate ideas” and “test ideas.”
Principle Four: “Deliver Wow!”
Providing a “wow” experience is each employee’s goal during every interaction with a guest, room making a reservation to saying goodbye. Managers want each guest to “feel a rush,” that is, an emotional connection so strong that staying in the hotel becomes a memorable experience.
Sometimes a problem or a mistake can give staff members the best opportunity to make a great impression. With the advent of instant worldwide communication – and Web- spread criticism – immediate problem solving is an essential. Employees learn to take a comprehensive approach to fixing guests’ problems. First, they demonstrate genuine, appropriate concern. Then, they apologize, accept responsibility and promise to address the problem immediately. Employees work together to rectify the situation and keep it from recurring. Their last step is to compensate the guests for their aggravation, loss or frustration in the most suitable way possible.
Ritz-Carlton’s leaders describe and reinforce its crucial principles by sharing “wow” stories. The manager of internal communication collects these stories each week and publishes them in the internal newsletter, Commitment to Quality. Managers share the stories at the Monday and Friday lineups. Employees whose stories make it into the publication receive a $100 bonus. Here’s one wow story: At Dubai’s Ritz-Carlton, assistant manager Saad Khatib struck up a conversation with a guest. He found out that the guest and his wife could not access the beach to enjoy the sunset because the wife’s wheelchair could not make the sandy descent. The next day, Khatib and the hotel’s carpenter supervisor arranged boards to form a path to the sea. At twilight, the couple dined on “an Arabic carpet on the sand” as they watched the sun go down.
Principle Five: “Leave a Lasting Footprint”
Ritz-Carlton’s corporate umbrella includes two training facilities. Its Global Learning Center provides employees with additional training so they can advance, and its Leadership Center offers executive training to people from other businesses worldwide.
Social responsibility has been a part of the Ritz-Carlton chain since its inception, as reflected in its mission statement. In 2002, the company launched its “Community Footprints” program to focus on “hunger and poverty relief, the well-being of disadvantaged children and environmental conservation.” The Ritz-Carlton contributes monetarily as well as through conservation and volunteering efforts. In 2007, it donated more than $7 million in funds, products and services, and its employees put in more than 40,000 volunteer hours. As former Ritz-Carlton president Horst Schulze explained, “If you focus narrowly on the bottom line, you leave a legacy only for investors.”
This is a culture case study taken from various sources.
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