This Study Resource Was: Week 5: Case #2

Customer Satisfaction Measurement
Week 5: Case #2
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Review the case, Ritz-Carlton Hotel Company – The
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Quest for Service Excellence
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Prepared by,
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Harsh Patel
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Guided by,
Dr. Doug Ross
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1. What is Ritz-Carlton’s business strategy, e.g., who are their primary customers?
 Ritz-Carlton’s main business strategy is to serve the local as well as travelling customers
within the countries with complete customer satisfaction measurements. They have good
idea about where to set-up a hotel such as near to travelling spots, near to exits on a free-
way, and near to metropolitan cities where people go to visit the most.
o Type/ Comfort level:
 Luxury Hotels (Ritz – Carlton)
 Upscale Hotels (Hilton)
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 Mid-price Hotels (Comfort Inn)
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Economy hotels (Best Western Hotels & Resorts)
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 Budget Hotels (Private Motels)
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o Ownership/ Management:
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 Possessed by same person or group of persons or a partnership.
 An individual person owns the motel, who works under the franchises
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under certain amount of rent agreement.

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 An individual person owns the property, but motel is run by a private

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company / franchises.
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 If the management wants to provide their best service, they must have to know what types of
customers they are going to have. This system can be used for any organization regardless of
whether it is hospitality service or any other service. If the management gets to know the
customer demand, then they can get successful in the business with more loyal customers.
Based on the case study I diagnosed, Ritz was planning to attract more of the rich, elite, and
higher paying customers, who wants world’s best class customer service at any cost
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demanded by the hotel. Their customers are mainly office meeting personnel, world
travelers who are rich in assets, business travelling personnel, and vacation travelers.
2. Among consumers, what accounts for Ritz-Carlton’s reputation as a high-

quality hotel? How is quality defined by customers?
 Ritz-Carlton is known for their golden service towards their customers. Quality in
hospitality business can be defined as consistent service provided repeatedly periodically. In
the hospitality industry, customers seek for service that can satisfy them completely. Before
the staff provide service to the customers, they need to understand what type of customer
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they are getting, what the demands of the customers are to match up their demands and
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satisfy them fully. Demands are categorized into two types: 1. Base expectation, 2. Needs/
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desire. If the staff can fulfill both, the customer would render happy, but satisfying the
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second would influence their mindset. The most satisfied customers would be most likely to
return to the hotel.

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 Since the hotel serves mostly the rich, elite, business travelers, and vacation people, the
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point below can help to identify the rating of the service customers expect:
o Customers would have easy check in and check out without delays.
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o Expectations of this subset of customers.
o Rooms are available on boarding.

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o Customer’s problems/issues are addressed and solved promptly.
 Ritz-Carton is only hotel that has been awarded with Malcom Bridge National Quality
Award 2 times in a raw and first one to receive this award in a hospitality industry. It is a 5-
star hotel chain business, which is Crème de la crème in customer’s point of view. Because
of their world class service, they have been featured in many magazines including Zagat
magazine, which is most viewed by consumers for reviews. Apart from that, employees of
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the hotel are trained such way that they remember every small details of the customers
including their names, so customers feel warm environment when they are being served.
These are the qualities that makes Ritz-Carlton best in all.
3. How is quality defined within Ritz-Carlton? Does the DQPR data in the ritz.xls
spreadsheet indicate any significant quality problems?
 In the point of view of Ritz-Carlton, quality is when an organization is able provide same
service every time and has a system that conducts and encourage their employees to commit
with the service consistency throughout the system. The organization may implement
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process management, process control, and quality improvement techniques to improve the
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service. The hotel also added some other techniques which help them provide consistent
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service, which are:
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o Integrated System: (MR. BIV- Mistakes, Rework, Breakdown, Inefficiency,
Variation)
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o DQPR System: It is a weekly report system that analyzes the trends and defects in
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the system through data collection from the hotel. These reports are primary source
that can detect deviation of the process which deviates from the standards of the
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hotel.
 Employee Based Reporting: This is a data collection process done by the

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employees. It assumes that employees will report any problems/issues on

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everyday bases. But the employees are having their regular job duties and
instant pacifications which may render them from reporting. Sometimes,
employees might not report issues because they might think it might lower
down their performance.
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 Undefined Methods for Data Analysis: The hotel does not have any
standard method for reporting and data analysis through DQPR system. This
system has excellent chances of errors since it does not have standard set to
compare the results.
 Training Personnel on DPQR: The employee is under training for quality
conduct. There is no documented record of how many employees are being
trained and how many are trained already. (Fraiman & Green, 2008)
 Ritz-Carlton’s Gold Standards promote and define quality in it. It shows the excellent
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quality they can serve to the customers. The summary count page shows the biggest problem
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area of a wide margin is cleaning issue which is reported 183 times in one report. It shows
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the problem of poor room cleaning and housekeeping by employees. Second major issue
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customers faced is at Front Desk, where customers are assigned rooms which are different
than their requirements. Third major problem is with communication and reservation
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between employee and customers, where customers receive wrong wake-up calls or did not
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receive any wake-up calls even upon requested.

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4. If you were to select a category of defect to address from the DQPR data, which
category would you address first?
 I would address miscommunication and reservations problem first, because phone calls or
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email reservations are first thing customers do before they enter the hotel. If the Front Desk
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employee does not understand the customer’s requirements, and make a mistake in the
reservation, the customer would become unpleased and cancel the reservation. Front desk
employee should promptly accept the calls of customers and address their problem regarding
their reservations or rooms, which did not occur many times in the report. Communication is
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the key to give best customers service. Customers can assume how they will get service at
the hotel by understanding the way employees are communicating with them.
5. For the defect category you selected, consider the process that generates the
defects. Construct a p-chart to assess whether or not the process is in control.
Identify the day(s) on which some assignable cause of added defects arose.
Day of Week Incorrect Room Assigned Incorrect Reservation
Sunday 9 11
Monday 11 6
Tuesday 15 6
Wednesday 9 25
Thursday 17 7
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Friday 14 9
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Saturday 13 10
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 By analyzing the p-chart, we can diagnose that the errors had become the most during
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Tuesday and Wednesday and gradually decreased when weekend falls. The problem with
incorrect room assignment, and incorrect reservation can be connected to the
misunderstanding of front desk employees, or wrong number and information provided by
the customers as well. During the vacation time, the influx of the customers and phone call
reservations increases the most, which become the main causative factor for employees to
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make mistakes, as they are taking care of numbers of customers at the same time. During
weekdays, the corporate customers, and other vacation customers come in with large
number and employees tends to make mistake because of fast-paced work. In other cases,
the customers were promptly resolved their problems with rooms or reservation issues. The
hotel should make a system that let the employees take care of customers in an organized
manner so that customers will not get dissatisfied and employees will also have less
workload.
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6. Using the results of your analysis, as well as other relevant tools of quality and
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your common-sense knowledge of hotel operations, generate hypotheses about
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the possible root causes of the defect category that you selected.
 The possible root cause of the problem of communication and reservation is that hotel did
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not have sufficient plan of action for employees to address or answers the queries of
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customers. The hotel can create an employee handbook which provide information on how
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to resolve a particular query a customer might have. Cellular providers are now providing
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automated answering system for businesses. Ritz-Carlton can set up this system which
would address common problems of customers over the phone without involving any
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humans, which can reduce the chances of error. Ritz-Carlton can create a hotline only for
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customers’ Q&A, which can be 24X7 or certain hours of a day. These plans can lower the
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workload of the front desk employees, so they can focus more on customer’s reservation and
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other issues and reduce the miscommunication.
 For the calls related to room service, the front desk employees and housekeeping employees
should provide with walkie-talkie or intercom system for easy communication so that they
can fix the problem in least possible time.
 For any wrong number problems, the customers should provide with phone directory in
every room with all department phone number details. The hotel should create an integrated
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system which can easily resolve information errors. Any wrong reservation or wrong
information related to reservation should be resolved with that system.
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References
[1] "Customer Expectations in Hotels: How to Make Your Guests Happy Every
Time.," [Online]. Available: https://www.hermesthemes.com/customer-expectations-
hotels-make-guests-happy-every-time/.
[2] N. &. G. L. Fraiman, "The Ritz Carlton Hotel Company - The Quest for Service
Excellence," Columbia CaseWorks, p. 23, March 14, 2017.
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Customer Satisfaction Measurement

Dr. Doug Ross

o Type/ Comfort level:

 Luxury Hotels (Ritz – Carlton)

 Upscale Hotels (Hilton)

 Possessed by same person or group of persons or a partnership.

under certain amount of rent agreement.

 An individual person owns the property, but motel is run by a private

2. Among consumers, what accounts for Ritz-Carlton’s reputation as a high-

hospitality business can be defined as consistent service provided repeatedly periodically. In

return to the hotel.

o Expectations of this subset of customers.

o Rooms are available on boarding.

o Customer’s problems/issues are addressed and solved promptly.

These are the qualities that makes Ritz-Carlton best in all.

 Employee Based Reporting: This is a data collection process done by the

employees. It assumes that employees will report any problems/issues on

instant pacifications which may render them from reporting. Sometimes,

down their performance.

compare the results.

 Training Personnel on DPQR: The employee is under training for quality

conduct. There is no documented record of how many employees are being

receive any wake-up calls even upon requested.

incorrect room assignment, and incorrect reservation can be connected to the

misunderstanding of front desk employees, or wrong number and information provided by

other issues and reduce the miscommunication.

can fix the problem in least possible time.

information related to reservation should be resolved with that system.

Time.," [Online]. Available: https://www.hermesthemes.com/customer-expectations-

Excellence," Columbia CaseWorks, p. 23, March 14, 2017.

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