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CASE ANALYSIS OF RITZ CARLTON COMPANY

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THE RITZ-CARLTON HOTEL COMPANY, L.L.C.
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Page 1: CASE ANALYSIS OF RITZ CARLTON COMPANY

THE RITZ-CARLTON HOTEL COMPANY, L.L.C.

Page 2: CASE ANALYSIS OF RITZ CARLTON COMPANY

BUSINESS OVERVIEW

The foremost name in luxury hotels

Ritz operated two world’s best hotels in London and Paris, referred to as “THE RITZ MYSTIQUE”

In 1999, Ritz had 36 hotels with revenue of $1.5 billion and total employees 17000

Merger with Marriott International Inc in 1997

Currently Ritz has 78 locations spread across 23 countries with 32000 employees

Page 3: CASE ANALYSIS OF RITZ CARLTON COMPANY

Credo - anticipating, resolving, and genuine care.

“We are Ladies and Gentlemen serving Ladies and Gentlemen”

Employee Promise for commitment with passion for excellence

Through the use of Malcolm Baldrige National Quality Award criteria a comprehensive structure was developed to optimize performance

Ritz differentiated itself with Business Excellence achieved through the participation of Employees under strong and involved leadership in all the three steps of Service

BUSINESS OVERVIEW

Page 4: CASE ANALYSIS OF RITZ CARLTON COMPANY

STRATEGIC PLANNING AND DEPLOYMENT

Ritz aims to be a leader in luxury hotels formulated its strategies (Mission)

10 Year Vision, 5 Year Mission, 3 Year Objectives and 1 year Tactics all aimed to achieve the mission in the near short-term, short-term, mid-term and long-term

To achieve the goal of product and profit domination, Ritz scanning the external environment regularly through Market Research and assessing the present and future state of competitors

Page 5: CASE ANALYSIS OF RITZ CARLTON COMPANY

STRATEGIC PLANNING AND DEPLOYMENT

Internal environment strengthened with the direct involvement of Upper Management in the area of training and Quality monitoring and improvement with regular feedback system from both the customers and employees

Strategic Development is set out as a Process to make specific decisions with measurable direction for Business Excellence

Macro-Environment Analysis with specific time set

Six P’s concept – Problem, Product, Promises, Personal Advantage, Positioning and Price

Page 6: CASE ANALYSIS OF RITZ CARLTON COMPANY

STRATEGIC PLANNING AND DEPLOYMENT

At every stage – Measure, Check and Act

Applicable to all the areas of work

Product Quality Indicators (PQI) and Service Quality Indicators (SQI). The daily point value is shared with the workforce and corrective measures initiated.

Comparative Benchmarking – within industry and foremost competitors, outside the industry and benchmarks inside Ritz

Page 7: CASE ANALYSIS OF RITZ CARLTON COMPANY

STAKEHOLDERS

Stakeholders – all groups – Customers, Employees, Partners, Stockholders, Suppliers, Regulatory Bodies, Local and Professional Communities – that are affected by the actions and results of an Organization. They have divergent and at times conflicting expectations.

Value Perceptions of each group is to be matched or enhanced with Value Offerings.

Stakeholders Loyalty is the key for sustaining growth and the success of the Managers is evaluated from this perspective.

Page 8: CASE ANALYSIS OF RITZ CARLTON COMPANY

Customer Focused Results is measured both internally and externally

Cornell School of Hotel Administration and McGill University undertook a survey of 13,400 managers in the lodging industry to identify “Best Practices” – Study names Ritz-Carlton as the overall Best Practice Champion

Customer Loyalty is the focus in Ritz with Credo and Basic Standards – referred in Ritz as Golden Standards

Total involvement of Upper Management and Employees to achieve Business Excellence in the three steps of services outlined under Business Review

STAKEHOLDERS

Page 9: CASE ANALYSIS OF RITZ CARLTON COMPANY

Ritz creates work environment that provides for Skilled and Empowered Work Force operating with Pride and Joy

They know what they are supposed to do and know how well they are doing – Towards this Orientation, Training Certification, Quality Selection Process, Communication and Personal and Professional Development are in place

They are empowered to make changes in the process under their authority – Issue Resolution Process, Performance Measurement, Job Enlargement, Employee Rights, Career Progression are in place in Ritz

Ladies and Gentlemen – referred in Ritz for Employees are rewarded and recognized through a proper mechanism that improves the morale all the time.

STAKEHOLDERS

Page 10: CASE ANALYSIS OF RITZ CARLTON COMPANY

STAKEHOLDERS

Employee Satisfaction Data in 1998 shows Ritz as way-ahead Leader in all the parameters of Service Company Norms except one norm

Interestingly the Understand Department goals show the same for Ritz and norms at 86% but other parameters showing remarkable achievement indicates the positive work environment.

The verbal recognition and monetary recognition at 69% and 50% as against the industry norms of 41% and 28% naturally contributed to ever-decreasing employee turnover – from 77% in 1989 30% in 1999

The goal of Ritz – pride and joy in workplace and full participation – enhanced through employee involvement in planning – 6500 people participated in 1998

Page 11: CASE ANALYSIS OF RITZ CARLTON COMPANY

STAKEHOLDERS

Performance of Suppliers – through Supplier Compliance and Quality Survey

Rating the issues after survey and certification of key suppliers

Number of Key Suppliers achieving 80% or better is ever increasing from 7 in 1995 to 13 in 1999

Profit maximization and Organizational Effectiveness results always encourage the Partners and Stock holders

Page 12: CASE ANALYSIS OF RITZ CARLTON COMPANY

PRESENTED BY -

# 139 - Pawan Bhatia

# 150 - B T Raghavendra

# 162 - Ruchi Kothari

# 182 - Suraj Atreya

# 187 - Swathi Ravichandran

# 192 - Tarandeep Singh Makkar

# 200 - Pooja Udaikumar


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