RITZ-CARLTON BUCK HEAD Harvard Case Solution & Analysis



Ritz-Carlton hotel first opened in Paris in 1898 by its founder, Cesar Ritz, who was known as King of Hotelier’s. After the economic crisis in the early 1920 and 1930s which affected Ritz-Carton hotel lead to the closure of most of its hotels. In 1983, Ritz Carlton’s trademark was sold to a real estate developer William B Johnson W.B. Johnson properties for $75.5 million based in Boston, Massachusetts. The first Ritz carton hotel in the U.S was established in New York in 1911. In its initial years of establishment in Europe, Ritz-Carton became a recognized name in the hotel industry providing high standards and style to its high-end guests.After Johnson acquired Ritz-Carlton, he was committed towards achieving excellence in providing its high-end guests with prestigious and highly personalized hotels. He dedicated his efforts to make Ritz-Carlton recognized for providing uncompromising high quality. He devised different strategies, philosophies to achieve his goal to be the most dominant in the hotel industry.Ritz-Carlton in the only hotel to win the Malcolm Baldrige National Quality Award twice in 1992 and 1999 respectively by operating 84 hotels and resorts in 26 countries around the world with over 38,000 employees.It has become one of the leading names in providing luxury services to high-end guest by strictly adhering to its standards of uncompromising high quality. The company is under the leadership of the president and COO, Horst Schulze. Nowadays, it is the subsidiary of Marriot international.

Ritz-Carlton’s business strategy

William B Johnson devised his strategies to show what Ritz-Carlton stood for, therefore Johnson for this purpose developed a strategy to focus the effort on developing a high standard quality services to its prestigious guests. The Gold standards are the foundation of the Ritz Carlton hotel showing its commitment to the values and philosophies by which they operate. The Gold standard includes Credo “The main mission of the hotel is to provide its guest with high-end service”. The Motto “we are ladies/gentlemen serving ladies /gentlemen”. The three step of service “includes the actions required when attending the guests, greeting the guests at first, anticipating the needs and bidding farewell after providing the services”.

Ritz-Carlton’s operation strategy

The operational strategies were developed by Ritz Carlton hotel to achieve its objectives. The management of Ritz Carlton believes that in order to provide its prestigious guests with the luxurious experience, it is mandatory that they focus on the training and empowerment of their employees by devising a system of targeted selection processes, employee orientation and rigorous training for every new hired employee. Each employee is well averse with the company’s philosophy, culture and it stands to continuously improve the level of competence of employees during the time of the employment.In order to meet the challenges in service quality and efficiency,TQM was used with process control to transform people and materials into service and product.

Operations strategy supporting role for business strategy

Ritz-Carlton hotel’s operation strategy has a supportive role in achieving the hotel’s long term strategic objectives. Horst Schulze used different operation strategic approaches such as sanctioning $2000 to each employee to make any guest satisfied. Treating employees equally to guests, as well as empowering employees (they are not servants but ladies and gentlemen serving other ladies& gentlemen)in turn raised the employees’ morale and increased job retention rates.The management believes that in order to achieve its goal of excellence in quality,the management of Ritz Carlton established the quality department in each of its hotel franchise in an attempt to achieve six sigma level of quality and to identify the defects in the processes of the hotel......................

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