Customer Reviews

The New Gold Standard: 5 Leadership Principles for Creating a Legendary Customer Experience Courtesy of the Ritz-Carlton Hotel Company

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"New Gold Standard" is a super, if slightly older, book on a really important subject: The Ritz-Carlton is one of the organizations whose methodology has truly transformed our understanding of what customer service quality and consistency can be.

I recommend "The New Gold Standard, especially if you're in the hotel business; Michelli, who also wrote The Starbucks Experience, is a consultant who did a great job writing it. I don't agree with the catty comments on this page that its writing style is sleep-inducing, etc. -- I guess they're complaining because it's written in an academic style and is maybe overly deferential to the owners of the Ritz (hey, it is an "official" history). Nonetheless, in my opinion it is still full of many well organized details and a helpful book for anyone in hospitality. Some of the strong points in particular are the historical overview and the interviews Michelli includes.

(One note to be aware of: There's now also a newer book on practical applications of Ritz-Carlton customer service and management techniques that's just come out this May; I really enjoyed it a lot. I got a lot out of this newer book ("Exceptional Service, Exceptional Profit"); it's by the founder of the Ritz Carlton Leadership Center along with Horst Schulze, the Founding President of The Ritz. They collaborate with an entrepreneur/systems expert from *outside* of the hospitality industry; this allows them to cover management issues in a lot of depth and in fields that are often far removed from just hotel-industry topics. Here's the link: Exceptional Service, Exceptional Profit: The Secrets of Building a Five-Star Customer Service Organization.

This book is a must read for anyone involved in the delivery of service, in particular, hospitality entities. This premise is not rocket science, yet, so few organizations do this well. This book chronicles how Ritz Carlton built its brand, not so much on facilities per se, but, the exceptional and consistent delivery of service. It starts by explaining that you first have to invest in your people. Everything begins there. A must read for the hospitality industry.

I have to say that parts of this book were so cloying and some of the anecdotes so over the top that I felt like throwing it away, except ... except for the fact that the Ritz-Carlton is one magnificent Brand founded on a great product.

As I continued to read, I began to appreciate why the Ritz-Carlton is so successful. The stories of over the top customer service and attention are so common, the attention to detail is so ... well ... detailed: these are the reasons why the hotel chain has become in the author's words - The New Gold Standard.

In this well researched book, Michelli identifies five key principles that ensure success for this great hotel chain and which of course everyone can learn from. There is nothing new about the five principles, but very few companies implement them properly

The principles are:
1) Define and refine
a. Communicating Core Identity and Culture
b. Be Relevant
2) Empower through Trust
a. Select - Don't hire
b. It's a matter of Trust
3) It's not about You
a. Build a business focused on Others
b. Support Frontline Empathy
4) Deliver Wow!
a. Wow: The Ultimate Guest Experience
b. Turning Wow into Action
5) Leave a Lasting Footprint
a. Aspire, Achieve, Teach
b. Sustainability and Stewardship

In writing book reviews, I don't normally re-run the basic contents page but in this case it is appropriate, because any one of the principles outlined above will help you grow your business. The challenge of course is how to do it. If there is one key lesson I take from the book it is - Reinforcement: Reinforcement of values, Reinforcement of culture and practices.

The hotel chain is constantly reinforcing its culture and ideals with its employees - "Ladies and Gentlemen serving Ladies and Gentlemen." Sure this might seem twee, corny, outdated but the chain appreciates that to maintain its success it must also "Be Relevant." Thus it has successfully targeted key demographics such as "Discerning Affluents," many of whom might not dress or act in the same manner as the "Classic Status Seekers" which was the core market for the Ritz-Carlton.

Michelli apparently had great access to company strategy. He highlights research conducted which found that four factors account for 85% of overall guest satisfaction. These are
1) Sense of well being
2) Anticipation of guest needs
3) Room condition and
4) Room assignment.

These four predictors - `drivers of engagement' - are reinforced through approximately 250 hours of training annually for each hourly employee including 15 minutes for daily briefing.

Bottom line: Some of the customer service anecdotes must have developed legs in the telling, but the fact is these anecdotes are part of the culture which is continuously reinforcing itself while also developing. This book will not change your culture overnight, but implementation of some key aspects will change your chances of business success over a period of time.

I've keyed into my database to read it again in 4 months time. That's the best testimonial I can give.

The IBM Competitive Edge Book Club is open to all Sales professionals at IBM. "The New Gold Standard" was our Q3 2008 book club selection. Overall feedback from the members was good. In the feedback from the members, we ask them the question - "What will you do differently in your job since your study of this book?" Some of the replies directly from the members included:

- "I will try to apply the concepts around exceptional customer service. Delivering 'wow' means extending our thought process beyond delivering just what is the basics and looking to over-deliver to our clients every day."

- "Focus on instilling and maintaining a service culture within my organization"

- "IBM has its own "ladies and gentlemen" - particularly pertaining to "dedicated to our client's success". What we can do better is help each other reinforce this with our local teams on a daily basis."

- "The book has given me good ideas for how to take customer service to the next level in our business. Some of the concepts and ideas in the book will help me when dealing with, or, selling to customers."

- "I think the book applies itself very well to anyone that deals with customers."

Thank you to Dr. Joseph Michelli for being apart of the IBM Competitive Edge Book Club experience and for writing a book that is interesting to read. The book drives home the importance of providing great customer service while balancing and recognizing those internally that create that experience for your clients/ customers.

Best Regards,
Brien Convery
IBM Global Workforce Partner and Competitive Edge Book Club Leader

As a frequent guest of Ritz-Carlton throughout much of my life, I can personally attest to the validity of its reputation for superior guest service in all respects. In fact, such service is consistently of such a high quality that guests take it for granted. Founder César Ritz observed long ago that "people like to be served, but invisibly." I agree while presuming to suggest that the "Ritz-Carlton experience" becomes visible whenever I stay elsewhere.

What we have in this volume is a rigorous and comprehensive examination of The Ritz-Carlton Hotel Company that, to the best of my knowledge, has not previously been provided. Joseph Michelli seems to have had almost unlimited access to its senior corporate executives, hotel managers and staff members ("the heart of the house"), and of special interest to me, its Leadership Center headed by Diana Oreck, vice president of global learning. Michelli observes that "From my perspective, the Ritz-Carlton [customer] experience is reflected in leadership committed to unrelenting quality, respect for all of the company's staff encounters, and oddly enough, also a great spirit of candor." Individual initiative is not only encouraged but indeed expected at all levels and in all areas in fulfillment of The Motto, "Ladies and Gentlemen serving Ladies and Gentlemen."

As I read this book, I was reminded of what retired CEO Herb Kelleher says when anyone asks him to explain Southwest Airlines' competitive advantage: "The intangibles are far more important than the tangibles in the competitive world because, obviously, you can replicate the tangibles. You can get the same airplane. You can get the same ticket counters. You can get the same computers. But the hardest thing for a competitor to match is your culture and the spirit of your people and their focus on customer service because that isn't something you can do overnight and it isn't something you can do without a great deal of attention every day in a thousand different ways. That is why I say that our employees are our competitive protection." He could have just as easily been explaining Ritz-Carlton's advantage in another highly competitive industry in which others also have excellent locations, superb facilities, state-of-the-art technologies, haute cuisine, etc.

The framework of Michelli's narrative is based on Ritz-Carlton's five principles that any organization (regardless of its size or nature) can establish and then sustain, creating a "gold standard" of its own: define core values and refine by leveraging continuous improvement; empower people with authority as well as responsibility through trust in their ability and eagerness to live The Motto; "It's not about you" (i.e. focus on serving associates as well as guests); deliver WOW! (i.e. a "thrilling customer interaction," especially when problems develop unexpectedly, as they i vitably do); and "leave a lasting footprint," an enduring legacy of great service for generations to come. Michelli explains with meticulous care how any other organization can to create its own "gold standard." Consider this statement by Ed Staros, co-founder of the Ritz-Carlton Hotel Company:

"We have not created the ultimate experience. It's still out there. It's that magic carrot we keep trying to approach. If you can come to work every single day focusing on how much better you can be today than you were yesterday, you will draw nearer to that carrot. You might never touch it, but you'll get one step closer."

Throughout the Ritz-Carlton organization, top to bottom, perfect service is a never-ending journey of continuous improvement rather than an ultimate destination. Michelli inserts dozens of real-world incidents throughout his narrative that illustrate that this journey proceeds one guest at a time.

For example, because members of the Ritz-Carlton staff are fully empowered, the Ladies and Gentlemen in Dearborn learned that a 13-year old champion figure skater, Natalie Salazar, had been diagnosed with osteosarcoma and her chemotherapy treatments proved unsuccessful. She was told by her doctors that she was going to die. Her biggest regret was that she would never be able to go to her high school prom. Technically, she was not a guest. However, according Laura Guitierrez, area director human resources, here's what happened. "We hosted Natalie's Prom in our ballroom, and it was attended by 18 classmates and 7 of her championship ice skating team members. Our audiovisual technician was the disc jockey, our IT technician was the photographer, our banquet director provided security, and everyone pitched in to make this an extras special event." Prince Charming guided her down the red carpet to her favorite song, "Sweet Escapes," and the room was fully decorated with photos of Natalie and her classmates from kindergarten to eighth grade. She danced every dance and ate her favorite foods. She died on September 20, 2007. The seamstress at Ritz-Carlton who made her prom dress also made the dress in which she was buried later. Michelli suggests that "While many other companies support members of their community, the Ritz-Carlton culture of service routinely delivers caring such as that provided to Natalie's family." And this is but one of several dozen real-world situations that Michelli cites, not an isolated incident or rare example.

Fortunately, thanks to Joseph Michelli's exceptionally informative as well as eloquent book, other organizations can now learn about the unique culture of The Ritz-Carlton Hotel Company and then apply (with appropriate modification) the core principles that continue to serve as that culture's foundation. And thanks to the Leadership Center, their leaders can gain a broader and deeper understanding of how service excellence and the quality of their own commitment to it can achieve a substantial ROI, not only in terms of dollars but also in terms of the lives that are enriched within their own organization as well as the lives of those whom they are privileged to serve.

Although it is a bit of an infomercial for Ritz Carlton,this book has good material for any service manager and is used for a services management class in the MBA program at my university. It also illustrates service marketing, quality, and managment concepts and how they are implemented at in the operation.

If you have ever been a guest at Ritz-Carlton, sought to understand their credo and values, or wanted to inspire others to create a world-class customer experience, I recommend this book. Thank you to Mr. Michelli for writing this book and to the ladies and gentlemen who inspire us all.

This book is VERY redundant and boring. I felt like I was reading a textbook, not a book about a well run business. This book takes a very disembodied, dehumanized look at customer service. I feel sorry for the hospitality students that will be forced to read it and think that hotels (even Ritz-Carlton) operate in such an automatic manner. Just for the record, I am also a hotel worker and very familiar with Ritz-Carlton. I don't see that company here!

It seems like everyone who's ever stayed at a Ritz Carlton has a story to tell. I guess we just tell them to each other because this is the first book I've ever seen about the marvelous organization that is the Ritz.

In The New Gold Standard, Joseph Michelli does an excellent job of describing why the Ritz is an icon for great service. He starts with the story of the Ritz, from Cesar to the present. Then he tells the purpose of the book.

"The New Gold Standard is primarily intended to help managers, owners, and leaders understand the driving principles, processes, and practices that have generated unusual staff loyalty, world-class customer engagement, and significant brand equity for Ritz Carlton."

He does that and more. Besides the view from the top, Michelli gives us the view from behind the counter and other places at the frontline. He structures the book by using five key principles that he thinks can guide any business that wants to deliver consistent, world-class service.

Principle One, Define and Refine is the foundation. You can't expect it if you can't articulate it. You can't expect it all the time unless you make it part of the culture.

This is not simply the "Credo Card." Many companies have something similar. It's working the card into discussions and instructions. It's sharing the card with guests.

It's the motto: "Ladies and gentlemen serving ladies and gentlemen." There's an old-world quaintness about the language, but there's no mistaking the meaning. People who work for the Ritz are "ladies and gentlemen." Their guests are "ladies and gentlemen," too.

There's attention to shared standards. Those include the Three Steps of Service and the 20 Basics.

One thing that makes Ritz special is that the application of all of those principles and rules is not rigid at all. And Ritz is always seeking ways to do them better.

Principle Two: Empower Through Trust. Ritz understands what many companies seeking "talent" do not and what many management theorists do not. Empowerment starts with making sure the right people are on board. That means "Select don't Hire."

Then pay attention to training, both to impart skills and as the carrier of culture. There are rituals, like celebrating service anniversaries that encourage people to talk about their service and the company.

Trust is vital. Ritz understands that trust is a matter of making and keeping promises. They also understand that trust and respect go hand in hand. The result is one of the most engaged workforces on the planet. They know this because they measure it, professionally and often.

This all brings us to empowerment. In many companies that's the word they use when they want you to "take risks." Ritz Carlton allows any staff member to spend up to $2000 per guest per day if, in their judgment, it needs to be done.

That doesn't encourage people to "take risks." Instead it does a much more effective thing. It allows staff members to make judgments and act on them without risk.

That brings me to my Ritz story. I was finishing up a book at the time and I had a speaking engagement at the Ritz Carlton in Philadelphia.

I decided that I could stay on at the hotel through the weekend and get the necessary writing done. It was a great spot for that, except for one thing.

The desk in my room was at a height for writing by hand. When I put my laptop on it and sat in the non-adjustable chair, my shoulders started to cramp after an hour or so.

As I was going out for my afternoon walk, one of the staff asked me if everything was alright. In passing, I mentioned the stiff shoulders and went on my way.

When I got back to my room, about an hour later, the standard chair had been replaced with an adjustable desk chair. I was much more productive that weekend.

Principle Three is: It's Not about You. Peter Drucker suggested that the way to success was to "focus on contribution." The Ritz takes that farther. They try to build their business on contribution to others, including guests and each other.

Frontline workers are the key. They are the hotel to the guest. You may never meet the General Manager, but you will certainly deal with staff at the desk, at the doors, and in the halls. Ritz knows they're the key to a great guest experience

Quality programs have a place here. But listening is the most important thing. As theologian Paul Tillich advises us: "Listening is the first act of love."

Principle Four is Deliver 'Wow!' Just about every company on the planet says they want to do this. They want to create what Ken Blanchard calls "Raving Fans." So why do so few companies do it?

The answer is simple. The Ritz can do it because it's done all those other things. They're clear about what they want. They select people who will fit, then spend time training, inculcating culture and empowering those people. When it's time to "deliver Wow!" most of the heavy lifting is done. It's easy.

Other companies want to jump over all that selecting and training stuff. They're not sure they can trust their people to make decisions on their own, so they don't really empower them to do so. You're not going to get a lot of wows out of that.

Principle Five is: Leave a Lasting Footprint. Michelli titled the first chapter in this section: "Aspire, Achieve and Teach."

What he doesn't say explicitly, but what I saw from his examples in the book, is that the Ritz sees training and supervision as two parts of the same process. It's how staff members learn every day what's important and how to do it.

But Ritz goes beyond that to find ways to bring lessons learned into the mainstream. They also find ways to be a good citizen. And, unlike many of the Corporate Social Responsibility advocates, they understand that both profit and individual choice are necessary.

This book does a great job of giving you a ground level view of how a great service organization works. It's a wonderful how-to guide if you want to create a similar service culture in your company. It shows you how to do things that are simple but not easy, long lasting but not quick, to become an organization that customers tell Wow! stories about.

Here's the second half of mine. Later that year, after the book was done, I was asked to speak to a group that was meeting at the Ritz Carlton in Aspen.

When I checked in, the clerk greeted me by name. He asked if I had stayed at that property before. When I said that I had not, he gave me a brief orientation. He asked if I had any special requests. I said, "No." It was all very nice and very polite, but not different from other top line hotels I've stayed at.

Then I went to my room. There, in front of the desk, was an adjustable office chair. I thought, "Wow!"

This review first appeared on my Three Star Leadership Blog.

This is a fantastic book, something every Hotel Manager should read and keep in their personal library as well as motivate his/her team to do the same. It is a must read for those who are willing to provide high quality service on a consistent basis.