An analysis of the hotel hospitality (service) standard – (A case study on Ritz Carlton)
Based on the survey did by Singapore Tourism board, during the IMF period out of the close to 1000 delegates majority of the them were “impressed by level of service standards in Singapore. Survey results shows that Singapore has what it takes to develop a world-class service culture. Three in four were very satisfied with hotel service standards and venue facilities. Although there was a high percentage of votes that shows satisfactory service standards were provided but there is still one out of the four whom is either neutral or unsatisfied with the service provided.
Hence, reasons to investigate would include does Singapore have what it takes in terms of the hospitality sector, able to develop a world class service culture? As a tourism hub, how would service standards impact the country/industry? Are the current service provided, meeting the standard requirements?
Tourism being a key industry in Singapore attracts millions of tourists and generates billions of income for the economy each year. In 2006, the number of tourists visiting Singapore reached a record number of 9.7 million as compared to 8.9 million in 2005, with an increase of 9 million in a year, beating expectations. Closely affected by the number of tourist visiting, the hotel industry also has experienced an outstanding year. With hotel occupancy and room rates at an all-time high, this shows positive outlook for Singapore and the industry. Key players of the industry include The Ritz-Carlton Hotel Company, L.L.C, Four Seasons Hotels Inc, Starwood Hotels & Resorts Worldwide, Fairmont Hotels & Resorts Inc, Hilton Hotels Corporation.
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The hotel industry can be segmented in the form of diamond rating of one to five by the American Automobile Associations (AAA) lodging classification. Ratings are given based on mainly the facilities and services provided by the hotels. One important factor of the five diamond rating is that the guest is made to feel like a very important person at all times by every employee of the organization. One fine example would be the Ritz-Carlton Hotel where genuine care and comfort of their guest is their greatest mission.
Lodgings with a one-diamond rating provide good but modest accommodations. Establishments are functional, emphasizing clean and comfortable rooms. They must meet the basic needs of privacy and cleanliness. Rates are generally economical.
The two-diamond lodging maintains the attributes offered at the one diamond level, while showing noticeable enhancements in decor and/or quality of furnishings. They may be recently constructed or older properties, both targeting the needs of a budget-oriented traveler.
Establishments rated three-diamond offer a degree of sophistication. Additional amenities, services and facilities may be offered. There is a marked upgrade in services and comfort.
Excellent properties displaying a high level of service and hospitality are given a four-diamond rating. These properties offer a wide variety of amenities and upscale facilities — inside the room, on the grounds and in the public areas.
Lodgings awarded five-diamond ratings are renowned. They exhibit an exceptionally high degree of service; striking, luxurious facilities; and many extra amenities. Guest services are executed and presented in a flawless manner. The guest will be pampered by a very professional, attentive staff. The facilities and operation help set the standards in hospitality and service.
Tourism in Singapore
Being flexible to the changes in the wider socio-economic environment shapes tourism in Singapore. Tourism policies and strategies have thus largely corresponded to global forces such as influencing trend in tourism and economic development as well as reacting to local factors such as changing social conditions in the country. With the increase in travellers for Business Travel, Meetings, Incentives, Conventions and Exhibitions (BTMICE), Singapore Tourism Board (STB) plans to focus its efforts on further developing this and including two other key customer segments; leisure and services.
Tourism drive in the next few years would include the FORMULA ONE SingTel Singapore Grand Prix, the first night race in the history of F1 racing. Two Integrated Resorts, Marina Bay Sands and Resorts World at Sentosa, coming up in 2009 and 2010 following, Singapore can look forward to even more regional and world interest in the future. In addition, the Singapore Flyer, Singapore’s iconic 165-metre observation wheel similar to the London Eye, is due to take tourism to greater heights at the start of 2008. Not forgetting its venture as a shopper’s paradise, there will also be three new shopping malls adding on to its exciting range of tourism products.
Impact of tourism on Hotel industry
Local hotel industry will have to be well-prepared for the visitors that will be travelling into Singapore. As Singapore focus on the Business Travel and Meetings, Incentive Travel, Conventions and Exhibitions (BTMICE) audience, it is important that our hotels meet the requirements of the international standards to cater well to our guest expectations.
In order to meet to the needs of these guests, service and facilities provided must be of a certain criteria. Standard facilities and services would include a 24hr business centre equipped with the latest device, International Direct Dial (IDD) phones, and internet, fitness centre furnished with the latest equipment, restaurants that provide food and beverage (F&B) services, guest service should also be available.
Singapore hospitality industry
Hospitality industry in Singapore has always been doing well, achieving an increase each year. From total number of 184 hotels in 1996 to 226 in 2009. Being a service sector, ensuring customers satisfaction would be their up-most objective. Catering to guest request within the shortest possible time, being pro-active, friendly and approachable towards guest would all make up to the delivery of good service.
Singapore’s best resource would be our labour force. All service sector’s success all ties down to its staff, same goes to the hotel industry. It is the work of all these contributions by commendable hotel workers which makes the visit memorable. Positive forecast and rising confidence in the hotel industry is an essential but not a condition adequate for the industry to pursue its growth to the next level. The hotel industry eventually depends on its people to accomplish this quantum leap.
Service workers play a vital role in building and burnishing Singapore’s reputation for being efficient yet hospitable. An exemplary hotel worker is one who is knowledgeable and display warmth and friendliness, takes good care of guests and gladness in pleasing them. Most importantly, one who is always learning how to do his job better.
A good hotel not only provides premium material comforts, it must also be capable of delivering these services through warm, friendly and attentive staffs to each and every hotel guest. In fact, something that leaves the deepest impression on the guest is quality of the service, or lack of it. Positively applying all these contributions fully in serving, guests bring away these memories that will make them want to come back again. Singapore values and needs more of such work force. They will become the role models, setting the standards to be followed by the peers. They create the benchmark for Singapore’s hotel industry on service delivery.
“In order to successfully transform Singapore into a global service capital, every one needs to play his part. I am confident that if we all take the extra step and be a GEM, and deliver our service from the heart, we will make a difference sooner rather than later, and create in the process a service culture in Singapore that others will talk about.”
By Mr Raymond Lim, Minister in the Prime Ministers Office and Second Minister for Finance and Foreign Affairs in the Excellent Service Award (EXSA) 2005.
Singapore – PEST analysis
Politically, Singapore Workforce Development Agency (WDA) has implemented the Go the Extra Mile for Service (GEMS) movement aiming to encourage better service. STB has set a target to achieve tourist arrival to 17million by 2015. Hotel performance reflects tourist arrivals, hence in order to achieve what STB’s goal service plays an important factor in improving hotel performance. Another plan by STB is to focus efforts on further developing customer segments (e.g. leisure and services).
Economically, customers have increase in spending power; people are more willing to pay for better service, locally and especially international guests. Locally, more jobs are being created due to the strong and stable economy growth in 2007.
Socially, consumers lifestyle are also improving, therefore when it comes to service it does not satisfy them with just the basics, they would expect value added services. With a fast moving pace, efficiency is another important requirement in service delivery. As a tourism hub welcoming a huge number of worldwide visitors, international service standards of the hospitality sector would be expected.
Technologically, Singapore has an advance technology infrastructure (Wireless Internet, well-coverage telecom services, 3G technology available) seamlessly connecting the people not only within the island but also world-wide. With these tools available it further supports efficiency of work.
The Ritz-Carlton Hotel Company, L.L.C. (Case study)
The history of The Ritz-Carlton Hotel Company, L.L.C. originates with The Ritz-Carlton, Boston in 1927. The standards of service, dining and facilities of this Boston landmark serve as a benchmark for all Ritz-Carlton hotels and resorts worldwide. Ritz-Carlton is a brand of luxury hotel and resort with 70 properties that are located in major cities and exclusive resort destinations of 23 countries worldwide. The Ritz-Carlton brand is managed by the Ritz-Carlton Hotel Company LLC, a subsidiary of Marriott International.
Service and Total Quality Management
Huge pressure on service industries to deliver superior service has been exerting on the increasingly open and intensely competitive market. Many hospitality companies have leap on the service quality bandwagon with the force of rising guest expectations and competitive necessity, which definitely includes the Ritz-Carlton Hotel.
In areas of service, Total Quality Management (TQM) is a participatory process that empowers all levels of employees to work in groups to establish guest service expectations and determine the best way to meet or exceed these expectations. TQM in Ritz-Carlton is referred to as A Way of Life which is a process of Mistakes, Rework, Breakdowns, Inefficiencies and Variation (M.R.B.I.V). The term guest is preferred over the term customer reason being when being able to treat customers like guest the easier it is to exceed their expectations. One successful hotelier has insisted for a long time that all employees treat guests as they would be like to be treated themselves.
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TQM being a continuous process works best when good leaders exist in the organization. They create a stimulating working environment in which guests and employees (sometimes called internal guest: one employee serves another employee who in turn serves a guest) becomes an integral part of the mission by participating in goal and objective setting. Leadership is put into practice in several ways. At the Ritz-Carlton, senior leaders personally work with employees to ensure the exhibition of Ritz-Carlton standards. On a daily basis, at the beginning of each shift, these standards are enforced during the daily line-up meetings, where employees are briefed on special concerns for that day. Through employee satisfaction surveys any gaps in the effectiveness of hotel or company leadership are identified. Any problems are dealt with through training.
Excitingly, by installing TQM everyone of the Ritz-Carlton Hotel becomes involved, creative ways of employees are encouraged to solve guest-related problems and improve service. Other benefits include cost reductions and increased guest and employee satisfaction, leading ultimately to increased profits. When employee satisfaction is high it boosts their morale and in turn they provide better services. Leadership is the vital component in promoting focused commitment as the foundation of a quality service initiative. TQM is a top-down, bottom-up process that can only be achieved with active commitment and participation of every employee ranging from the top executives down to the bottom of the corporate ladder.
TQM focuses on error prevention and quality control (QC) focuses on error detection. Quality control is generally based on industrial systems hence it tends to be product-oriented rather than service-oriented.
To empower employees, managers must be able to:
- Take risks.
- Foster a learning environment.
- Share information and encourage self-expression.
- Involve employees in defining their own vision.
- Be thorough and patient with employees.
The Malcolm Baldrige National Quality Award is the highest level of national recognition for quality that a U.S. company can receive. The award promotes an understanding of quality excellence, greater awareness of quality as a critical competitive element, and the sharing of quality information and strategies.
Seven categories make up the award criteria: Leadership, Strategic Planning, Customer and Market Focus, Measurement Analysis and Knowledge Management, Human Resources Focus, Process Management and Business Results. At Ritz-Carlton, a focus on these criteria has resulted in higher employee and customer satisfaction, increased productivity and market share. Perhaps most significant is increased profitability.
The company won the Malcolm Baldrige National Quality Award in 1992 and 1999. The Ritz-Carlton Hotel Company was the first hotel company awarded the highly prestigious prize, given annually by the U.S. Department of Commerce. With 24-hour room service, twice-a-day maid service, complete gymnasium facilities, and menus that continued the tradition of culinary excellence well prepared for competing with Four Seasons and other hotel groups in the luxury hotel market. Ritz-Carlton Hotel is the first to win and only two time winner of the hotel industry.
The Ritz-Carlton Hotel Company was founded on principles of innovative levels of customer service. The essence of this philosophy was refined into a set of core values collectively called the Gold Standards. The credo is printed on a small laminated card that all employees must memorize or carry on their person at all times when on duty. The card lists the three steps of service.
Strengths of Ritz Carlton would be first of all their staffs. With strong beliefs in Organizational leadership capabilities, company leaders are responsible for developing factors that are vital to the success of the company. The Ritz-Carlton Gold Standards Software (e.g. Real-time Database System) available, information can be updated simultaneously throughout operations as a result improves service delivery in terms of efficiency and accuracy of information. With the support of their database system, individualize service could be provided by employees remembering and recognizing guest by name and takes note of the preference of guest when they visit. One example is the review from Asiarooms.com, “Ritz Carlton Millenia is the only hotel in Singapore whose staff greets you with smile and your name, even at 3 a.m.”
Committed employees rank as the most essential element. All employees carry a pocket-sized card stating the company’s Gold Standards, which include a credo, motto, and the 20 basics. Each employee is expected to understand and adhere to these standards, which describe processes for solving problems that guest may have. All employees are to go through training before working at Ritz-Carlton. Ritz-Carlton Hotel is a place where empowerment of employees reinforces decentralized decision making closest to customer. Empowerment is not an organization concept rather than an operational philosophy. All staffs are given empowerment to break away from their job to attend to guests. Each employee is empowered up to $2,000.00 per day/per guest. With allocation of empowerment by leaders to employees, trust is being built upon.
Service like multi-channel touch points are provided for guests. This includes online, front desk, guest and phone services to allow transaction and information to be passed through. To improve service delivery, software is available to allow latest update of guest or company information, on example would be real-time database system. They also provide individualized service, by implementing a Guest Recognition Program. With this guest recognition program, guests are recognized and address by names when greeted, personal preference are also recorded and entered into the database system. All employees in Ritz-Carlton are to personally escort guest to their enquired location rather than directed.
The first to win and only two-time winner of the Malcolm Baldrige Award in the service category (1992 and 1999) truly shows that they possess a strong business model. Basically, the methods used by Ritz-Carlton Hotel to achieve their vision are based on application of the principles of TQM, the Malcolm Baldrige national quality award criteria and the “Green Book”—an employee handbook.
Ritz-Carlton weakness would include the physical landscape of their hotel. There have been review of guest complains that furniture are worn out. Positioned as a High end hotel, naturally it will only be catered to guest who can afford the stay there. Underperforming employees would also post as a huge weakness for Ritz-Carlton. There are complains from customers saying that employees in reception are giggling away, ignoring guest.
Opportunities are increasing as STB targets to attract visitors of 17million by 2015. With the increase in number of tourist arriving, Ritz-Carlton can target on the larger number of customers. With STB’s support for further development of the BTMICE sector, they can make use of the chance to look for areas to review and further improve guest service due to the higher expectations for service delivery.
Threats identified would be competitors following Ritz-Carlton’s business strategies. With the pressure on service excellence and looking at Ritz-Carlton’s success there is a high possibility of competitors following their business strategies. Being on the top for as a service provider, it will be a test to how they can still further improve and be above competitors. The upcoming of Integrated Resorts will also mean that business might be taken away as there a more choices available for the visitors. With Singapore facing the problem of lack of manpower in the service line, it will post as a difficulty for Ritz-Carlton to find a suitable labour force for their service delivery.
Recommendations to Ritz-Carlton would include with regards to their hotel’s physical landscape, they can considered renovating the hotel’s interior. Indentifying all problematic facilities available in the hotel and replace those within the shortest possible time so that it does not affect the guest experience. For the problem to underperforming employees, Ritz-Carlton could highly encourage and look into guest feedback, especially for post-service feedbacks. It is actually very important to push for post-service feedback as usually when customers are unhappy about the service provided, few will bother to complain and will just switch to other available similar service provider as they have the power to do so. If Ritz-Carlton is capable of getting feedback from the unhappy customers they will be able to fully resolve the problem of underperforming employees.
In order for Singapore in terms of the hospitality sector, to develop a world class service culture, philosophy and accomplishment of Ritz-Carlton could be adapted. To educate Singapore citizens of the roles they play in presenting Singapore to the world. As a tourism hub, by having excellence service these standards will be able to help Singapore open up to numerous opportunities for the world class service industry.
Regardless the role of the employee in the company be it member of the frontline staff or a backroom team, all employees contribute significantly to a hotel delivery of service. Services are experiential: they are felt, lived through, and sensed. The moment of truth is the actual guest contact.
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