The Ritz-Carlton hotel company is a leading hotel management company operating 38 hotels and resorts all over the world. There will be a new hotel opening as part of a multi-use facility owned by Millennium Partners. When James McBride, the general manager of the new Ritz-Carlton Hotel, is responsible for opening the new hotel, he faced a challenge. There are some doubts with the “Seven Day Countdown”, a training method to the new employees. Brian Collins, manager of hotels for Millennium Partners questions whether the seven day training is enough to the new hires, and wants to closer to 80% initial occupancy rate.
Ritz-Carlton is offering professional service to the customers. Schulze, the CEO of Ritz-Carlton, suggests that they are aiming to selling service instead of selling rooms, selling food and selling the bar although they do those things incidentally. In the 7-day training period, the new employees would learn the culture and value of the hotel and the coming five days are for training and trial runs of service delivery. In the day one, Schulze, the CEO of Ritz-Carlton would explain his philosophy of being a high-quality service organization and show the Gold Standards to the new employees (Appendix 1). In the day two, the new staffs would have a view of the new departments of the hotel and learn more about each other. In the following 5 days, they would get the skills training in terms of standards set of their jobs and how to handling guests requests.
The Seven Day Countdown brought greater efficiency and has been conducted in many Ritz-Carlton Hotels, while Brian Collins, manager of hotels for Millennium Partners is concerned that the seven-day time frame limited the hotel’s ability to offer the high-quality service to the customer and took a long time to reach 80% occupancy rate.
Ritz-Carlton should lengthen the 7-Day Countdown to 14-Day Countdown before the hotel opening as it is difficult to train the new hires well in seven days. Furthermore, it is profitable and it will improve the partnership with Millennium Partners. Although the one week extra training will lead to an increase in the cost, the increase overall occupancy each month will bring large increases in the annual profit. In additions, the quality of service will be increased rapidly.
The priority things which Ritz-Carlton need to do is to inform the new employees about the extending training and revise the new the countdown schedule. And then launch the new countdown. The extra cost would be 745,000 dollar (2500+7000+15000+5000+5000+40000) (Appendix 2), which would be a small part of the pre-opening budget (3,500,000 dollar). But it will bring huge profit in a long-run.
Sucher, Sandra J., and Stacy McManus. ” The Ritz-Carlton Hotel Company.” Harvard Business School Case 601-163, September 2005.
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