THE RITZ-CARLTON HOTEL COMPANY Harvard Case Solution & Analysis


The most luxurious hotel company, the Ritz-Carlton hotel company came into being in 1898. This hotel company was the dream of one of the shepherds of Switzerland named as Cesar Ritz. In his past he had been working in some of the most restaurants and hotels. Now, he had made his dream come true of forming the hotel company on his own name. The current general manager of the hotel company is James McBride.

Ritz Carlton in the initial 10 years of its operations had been acquired by Marriott International in 1997. The headquarters of the company are located in Chevy Chase, Maryland, Washington D.C. Primarily, this company was owned by the management and it was a management company. The company was also credited as the Best hotel of Asia Pacific. Ritz Carlton was now opening this $225 million project for Millennium Partners, which was one of the famous real-estate development groups in New York.

The business model of the company is basically based on providing quality service to its customers. James McBride had always focused on serving its customers by serving them for a purpose. He also introduced the new concept of ‘Technology Butlers’. These were the expert technicians that would assist the incoming guests with all the technological and any kind of problems faced by them. Apart from this, they had also focused on the attracting business travelers. The revenue generated from these business travelers constituted of about 40% of the total annual revenue of the company.

The company’s high profitability and success to attract customer’s lies in the fact that the company has implemented Total Quality Management practices to meet the desired needs and wants of its customers. For maintaining such high standards of quality, the company has been awarded the Baldrige Award for 2 times in a row. Service Quality Indicators (SQIs) were also designed by the management of the company such as anticipation of guest needs, guest room conditions and assignments, cleanliness of hotel, resolving the customer problems and many more. The company had also focused to develop its human resource and make its human. The corporate vice president of the hotel company, Leonardo Inghilleri had emphasized on this by saying that if an organization takes an accounting approach towards its employees, they will fail to achieve their purpose. The management of the company should have passion for its employees. The motivation and the dedication that was instilled in the employees is evident by the fact that the turnover rate of Ritz-Hotel Company was just 20% as compared to the 100% turnover rate of this industry.


The company is now planning on how to launch its current project. The company has always focused on customizing the hotel to meet the specific demands of the population where the hotel is being opened. The company is now planning to open the new hotel and is facing the dilemma that whether the 7 day countdown is enough time period to orient and train the employees and launch the project. The question is now how this will impact the Ritz-Carlton if the time frame for this countdown is increasing on the other hand it is also important to convey the high standards that have always been maintained at Ritz-Carlton Company.

The specific issue with this problem was that if the company launched its project after the 7 day countdown, then it might not be possible for the company to achieve a higher occupancy rate of about 80% in a shorter period of time. This means that it is really difficult to convey the high standards of the company which it had developed and maintained over the years to its new hires. Apart from that, anotherissue focused on the brand image of the company. The Ritz-hotel company had always launched the hotel after a 7 day countdown and this was recognized as one of the best world practice. Therefore, it would badly impact the brand image of the company if it increases the time period of the countdown. But on the other hand the company also needed to think about getting the objectives of the hotel being met. Its main focus was the guests that are coming to visit the company. This was the dilemma faced by the management that whether to increase the training days or not.


Before launching any hotel business, it had become a standard to conduct the Seven Day Countdown. This program was designed to release some of the burden on the managers by giving the desired training to the newly hired employees. This seven day program comprised of two orientation days and the remaining 5 days were devoted to the skills training of the employees to make them work on their job tasks. During these seven days employees were.....................

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