Thoughts on Leadership: Lessons from the Ritz-Carlton Hotel Company

By Gino Blefari

This week my travels found me starting Monday at home with my typical WIG calls then traveling to Atlanta, Georgia for the Realty Alliance General Membership Meeting. The conference was filled with valuable takeaways and insights from trailblazers, disruptors, and visionaries in the world of real estate and beyond. There was one keynote that had a particular impact on me, delivered by Horst Schulze, co-founder, and former president of the Ritz-Carlton Company. I’ve written about the Ritz-Carlton Gold Standard for operations before, but to refresh your memory these are a few of the Gold Standard values that guide the company and its team members to operate with impeccable service and the highest standards of performance, execution and leadership:

1. I build strong relationships and create guests for life.
2. I am empowered to create unique, memorable, and personal experiences for our guests.
3. I continuously seek opportunities to innovate and improve customer experience.
4. I own and immediately resolve problems.
5. I create a work environment of teamwork and lateral service so that the needs of our guests and each other are met.
6. I am involved in the planning of the work that affects me.
7. I have the opportunity to continuously learn and grow.

In his presentation, Horst Schulze told an interesting story that is the epitome of accountability in action. He said that if there was an underperforming hotel, he would give the general manager three months to turn things around; if they didn’t, he’d go to the hotel, sit in the GM’s office, and have the GM sit in the corner and watch Schulze turn hotel operations around. Talk about accountability!

Here are a few other lessons from Schulze:

Top performers pick up the trash. What’s one trait of a top performer? They pick up the trash, says Schulze. When something isn’t taken care of, they’re not afraid to get their hands dirty and do it themselves. Wait around for someone else to do a job you may not want to do, and you’ll be waiting forever. And who can perform if they’re just sitting there waiting for something to happen? Make it happen yourself, Schulze explains.

Don’t ever be late. To Schulze, one of the greatest insults is tardiness. He says it doesn’t matter if you’re thirty seconds or thirty minutes late; when you’re late, you’re late and it is a sign of disrespect and a lack of care. You arranged for someone else to meet you at a particular time and place (even if it’s virtually), you have a duty to be there at that exact moment, too.

Managers push, leaders inspire. Managers control the hierarchy of an organization, says Schulze but they don’t have real buy-in when it comes to the overall success of the team or their ability to inspire their team to reach new levels of greatness; they simply care that profits are increasing and the business is growing. A leader is someone who gets that team members to want to do their job. They know an inspired employee is a passionate employee and that dedication to excellence spills out into all aspects of the company.

Excellent customer service can cost you – and that’s OK. At the Ritz-Carlton, it was common practice to spend money to keep guests happy. In fact, every employee could spend up to $2,000 per guest, per incident to right a wrong. Sometimes this meant purchasing a meal for a guest who was dissatisfied but sometimes, it was even more extensive. At the Ritz-Carlton in Cancun, Mexico, for example, hotel employees used that money to buy metal detectors when a young couple on their honeymoon lost their wedding band on the beach. At another location, one guest – a mother with a two-year-old son – realized her son lost his favorite Thomas & Friends train toy while they were packing up to leave the hotel and head to the airport. Frantic, the mother mentioned the missing toy to one of the Ritz-Carlton employees and called the loss “heartbreaking.” The employees helped the mother search for the toy to no avail, so they simply went to the nearest toy store and purchased a new one for the woman’s son. They gave it to him with a note that said, ‘Thomas took a long vacation but he’s back now and included a few photos of the Thomas toy in various locations around the hotel. The mother said she would tell anyone she met that Ritz-Carlton won her business for life.

So, what’s the message? Horst Schulze is widely regarded as an icon in the service and hospitality industry, not only because he led his company with excellence but also because he instilled the idea that excellence should not be a sometimes-endeavor; it is an always-endeavor and with perpetual improvement, impeccable service, and an empowered team, you can achieve this excellence no matter what business you’re in or what customers you serve.