'Ritz Carlton Сase Study\r'

'The history of The Ritz-Carlton Hotel Comp each, L.L.C. originates with The Ritz-Carlton, capital of Massachu designatets. The standards of servicing, dine and facilities of this Boston divide serve as a benchmark for either Ritz-Carlton hotels and resorts worldwide. The legacy of The Ritz-Carlton, Boston begins with the celebrated hotelier Cesar Ritz, the â€Å" office of hoteliers and hotelier to kings.” His philosophy of service and innovations redefined the extravagance hotel drive in Europe with and by his counseling of The Ritz genus Paris and The Carlton in London. The Ritz-Carlton, Boston revolutionized hospitality in the States by creating extravagance in a hotel range: Private bath in each lymph node get onLighter fabrics in the lymph gland room to all(a)ow for more(prenominal) thorough washing White tie and apron uniforms for the wait staff, black tie for the Maitre d’ and source light suits for all opposite staff, conducive to a formal, p aid appearance Extensive fresh f low gearers throughout the open beasA la carte dining, providing choices for diners Gourmet cuisine, utilizing the genius and readiness methods of Auguste Escoffier Intimate, smaller lobbies for a more personalized lymph node experienceCesar Ritz died in 1918 however his wife Marie continued the blowup of hotels bearing his name. In the United States, Albert Keller bought and franchised the name and effected The Ritz-Carlton Investing Comp both. In 1927 The Ritz-Carlton, Boston, opened and otherwise hotels followed in New York (at Madison and 54th), Philadelphia, Pittsburgh, Atlantic City and Boca Raton, followed by the Miami hotels including the southwest nearwestern beach location. However, by 1940 none of the hotels were operating(a) except The Ritz-Carlton, Boston. The hotel embodies the vision of Cesar Ritz, Yankee ingenuity and Boston social sensibilities.The Ritz-Carlton south beach resort was first reachd in 1953 with the acquisit ion and recurrence of the Morris Lapidus- intentional Di Lido Hotel in Miamis in the south Beach district. The refreshful resort featured 375 populate; a 16,000-sq.-ft. spa located on the third gear level; and 20,000 sq. ft. of standing space, including a 10,000-sq.-ft. ballroom undetermined of seating up to 1,000 guests. The historic restoration retains the out-of-door flavor of the Morris Lapidus design, characterized as Art Moderne or MiMO (for Miami Modern). A three-story addition on surmount of the live eight-story hotel, a abundant with the incorporation of other surrounding structures into the new resort, brings the Ritz-Carlton to approximately 500,000 sq. ft. These futures along with the rich history of the building make this hotel resort one of a charitable and a must see destination.II. Company ProfileThe Ritz-Carlton due south Beach hotel lies on Miami’s most storied beach and is located just steps from maritime Drive and Lincoln Road. This is a 10- block pedestrian esplanade with the trump out shopping, dining, nightlife and people-watching south-central Beach Miami has to offer. This hotel caters to the most discerning hotel guests, dignitaries and celebrities and take ons features that you whitethorn non find anywhere else. The hotel has 375 busty guest rooms, including two poolside lanai wings in the style of aboriginal Miami Beach. It also provides more than 20,000 total square feet of especial(a) reciprocal ohm Beach meeting and conference facilities and a 16,000-square-foot Ritz-Carlton spa.This resort is a prime location, within walkway distance to Miamis Ocean Drive, Lincoln Road and South Beach nightlife. The hotel went through a complete restoration of the original 1953, Morris Lepidus- intentional, landmark South Beach Miami hotel in order to provide their customers with the luxurious experience associated with the Ritz Carlton name. The hotel is rated as a triple a diamond class 4 hotel, making it the r ecipient of the soaringest rating honor for a luxuriousness hotel. client Room Features & deoxyadenosine monophosphate; creature comforts400-450 square feet Views of the Atlantic Ocean, pool, and South Beach Contemporary, affectionate furnishings inspired by South Beach’s vibrant naval destination with the luxuries of home, accented with modify of blue, sea mist green, and coral Generously size desks iPod docking stations, with AM/FM clock radios In-room laptop-compatible gumshoe Com s differenceer and fax hookups Multi-line speech sounds with hold button survival of the fittest of one king or two figure beds Goose down and non-allergenic foam pillows Luxurious atomic number 6% cotton linens Sumptuous marble baths Suit, skirt and aggrandize hangers Fully stocked mini refreshment bind out Rollaway beds ready(prenominal) ($50 per twenty-four hours) All rooms in our South Beach hotel are non-smokingProperty Features & angstrom unit; Amenities The Ritz-Carlton Spa The Signature Shop Two restaurants, including upmarket dining and casually wise oceanfront lie in wait dining Elevated outdoor pool and private day beds over ask the Atlantic Ocean $2 trillion original art collection featuring established and emerge artists 24-hour room serviceValet parking available at our Miami hotel: chance(a) $27 / Overnight $36 Limousine go available upon request Personal shoppers available upon requestIII. symmetry scorecardThe balanced scorecard is a strategic readying and management system that is used extensively in the hotel industry to align vexation activities to the vision and dodge of the presidential term, improve internal and external communications, and monitor organization effect against strategic goals. The balanced scorecard has evolved from its archaean use as a simple performance measurement to a full strategic provision and management system. The â€Å"new” balanced scorecard transforms an organization’s strategic plan from an deplumateive but passive document into the â€Å"marching orders” for the organization on a daily basis.It provides a framework that not only provides performance measurements, but also helps planners attain what should be done and measured. It enables executives to truly execute their strategies. The Ritz Carlton uses this scheme and is comprised of some divulge basic concepts, which are monetary, Customer, cultivation and growth, and internal bloodline processes. By adopting this crucial strategy, Ritz Carlton south beach allow for be able to create a consistent level of service and gibe a path of future growth.A. run civilizationWho We argon The Ritz Carlton sepa rank itself from its competitors in the hospitality industry by crack experiences of exceptional quality. Our objective is to be considered the beat out extravagance hotel strike out in the world with each and each location personifying that goal to our customers. We build propert ies that are knowing to take you away to a dream of inexhaustible possibilities and tour also creating a service culture that is the best in the industry. Doing so allows Ritz Carlton to satisfy the ineluctably and tastes of our customers, and to importanttain our position as the worlds premier luxury hospitality participation.What We Believe Our greatest asset is our group. We do not label our staff with the term â€Å"employee” or â€Å"worker” be stir it takes a true group run to provide the type of experience that the Ritz Carlton is world renown. We see that each team member exemplifies that notion and proudly in windlessnesss the image of Ritz Carlton to our customers. Our success depends on the work of our team and we go away always be known as having the best team members in the land.How We Succeed We chase when all the core components of the BSC are achieved. We must revolve around on the postulate and desires of our customers while also maintain ing a safe and surplus level of revenues and internet while minimizing our expenditures. We must account for our outside competitive set and deliver a product to our customers that tushnot be matched.How We dissemble We demonstrate our behavior through hard work, compassion, and a true love for what we do. We pride ourselves on having the best code of conduct policy which adheres to all ground and federal guidelines while ensuring the happiness of our guests and team members.B. residual Scorecard table (exhibit 1) â€Å"A broad look”(Exhibit 2) â€Å"a detailed look into BSC”Perspectives Objectives Measures Target Initiatives/Actions Financial 1.Increase receipts 2.Increase RevPAR 3.Increase profit margin 4. Minimize expenses P& angstrom;L statement STAR reports incision operations reports Operating budget -Maintain RevPAR Index make higher ADR, RevPAR and OCC% than comp set 30-40% profit -secure market voice from competitors. -Maintain optimal ADR by appropri ate revenue management †Up sell high margin serve Customer -Customer service †No guest disagreement -Happy guests-Customer Satisfaction accept customers Referred customers -Online surveys -100% customer triumph †Repeat business -Loyalty-Monitoring social media -Mystery shoppers -Score cards with inducings to give any feedback -Creating internal network for sharing customer ifo mingled with associates Internal stock Processes †Adherence to brands standards for operations processes †pursuit standard operation and billing procedures in the ply subdivision -Service errors -Failure rates -Maintenance and renovation of physical assets †Guest complaints †Bill disputes-3δ level of quality for all business processes †Less than 1% bill disputes -Hiring an Operations chink manager †standardized Training for all employees -operating stock-take cycle monitoring Learning and Growth †cookery and retaining the best associates. †Shorter work hours and rested more enwrapped employees in catering department. †Internal Promotion †employee turnover rate †Associate store †Employee overtime †Employee burnout †Service satisfaction ratings for F&B department -70% promotion from within -turnover downstairs 40% periodical & 10% managerial -5-15% overtime for F&B employees maximum -Developing effective bringing up programs-Quarterly reviews and evaluations †Incentives for employees staying in the company -promotion from withinThe BSC tables instituten in exhibit 1 and 2 highlight the objectives considered important for the Ritz Carlton at south beach to succeed. Due to the fact that it is a luxury property, the objectives considered in this table are aligned with strategies targeting upscale travellers with unique demands and needs. In a luxury hotel, the top line revenues and profits depend on the level of guest satisfaction.It is assumed that wealthy travelers are impulsive to pay a premium if all their needs and demands are satisfied. Thus exquisite hotels much(prenominal) as The Ritz Carlton depend leadly on the level of satisfaction of their guests as well as the public erudition of their brand name and property when setting room rates and other set strategies. With all universe said it makes sense that such an emphasis is put on the level of service in this heartbeat exhibit of BSC.The balanced scorecard approach allows a hotel to asses what its biggest area of opportunity is to succeed and build upon that to make better serve its customers worldwide. Financial and business process measures are taken into account to assure that the company is political campaign at optimal efficiency and that money is beingness made at an acceptable rate. Although these measures are important, they would squiffy nothing without the loyalty, retention, and happiness of your team members. In this case, the Ritz Carlton is a luxury hotel, so w ay on the retention and overall happiness of your team members is what will eventually good you the most.Companies make it a priority in finding and retaining top team members, but it is precise difficult. This is why managers must acknowledge the presence of such members on their staff and make an effort to guard them in the company. The retention and development of these members is pick out in the success of the hotel. You must also understand that not all(prenominal) person is suited for the luxury service culture, so finding the best mix and combinations of team members will bode helpful in the long run. Training courses and a structured system for development should also be put in derriere to ensure a consistent service culture.A wide retention meter would be to offer employees incentive for their performance. This can be money based, recognition based, or promotion based. Internal promotion is a make out adopted by upscale properties more than numerous other types of hotels because the team member is battle tested. They nonplus been brought up from within he/she has learned the company culture along the way and already has the bearing and approach needed to be successful. Another benefit is the fact that this person is familiar with a bear-sized portion of the hotels operations, making the transition easy to any department or manager role when needed.Maintaining and prodigious financial goals and measures are important to the short-term operative success of the hotel; however, the purpose of the Balanced Scorecard is to underline the importance of non-financial measures for the success of the business. By following this objective, you will create team member satisfaction, which will cause the customers to experience the full luxury experience, and it will all trickle down to the bottom line, which is increased revenue, and high profits from all departments.C. Strategy mapThe Strategy play below shows how the four perspectives of the BSC influence each other and how the objectives in the bottom affect the ones above them. This in conclusion leads to ace workforce effectiveness. Not only does this show workforce effectiveness, but also the overall guidelines to superior financial performance.IV. Operating Budget(See attached Excel document)Market segmentsThe Ritz Carlton at south beach differentiates its potential guests into 2 main market segments †corporate (business travelers) and blank (vacationers).Corporate Luxury hotels put one over traditionally focused on the business traveler because of the amount of money they make and spend, and the frequency of their visits to the property. However, galore(postnominal) of the luxury brands including the Ritz, establish shifted their focus to other segments. Business travelers rarely use all the amenities available to them at the resort, and restrict their visit to a â€Å" schoolmaster” exposure.Even with that known, Corporate business during high seaso n is still considerably high. Luxury brands do not disregard as much as their lower end neighbors. During low season the hotel can try to attract some large corporation meetings to offset other lost opportunities.Leisure Just as stated above, the vacant segment is picking up popularity each and e precise division and many luxury properties have heavy their efforts in attracting these leisure guests, whose main purpose is to give wide array of services and products offered, thus generating surplus revenue through the alternative revenue sources. (Unlike the business traveler). There are multiple types of subgroups within the leisure segment such as passing(a), and group rates.The transient rates vary depending on the time of family or season. For luxury hotels such as the Ritz Carlton, the rates can skyrocket in season, and fall drastically off-season. Group rates are tailored to meet the needs of different companies, charities, and other organizations with better pricing for bulk deals. Rooms Department †a P&L evaluationThe sample data below was fabricated to reflect standardised numbers that is shown their most recently available STR report. The data is an approximation, but will show key patterns in ADR, RevPAR, Occupancy percentage, and revenues.Jan Feb certify April ADR $649 $729 1399$ $679 OCC% 80% 88% 95% 85% RevPAR $519.20 $641.52 $1329.05 $577.15 Revenue $5,841,000 $6,735,960 $15,450,021 $6,492,93730 28 31 30May June July August ADR $329 $379 $389 $299 OCC% 60% 52% 55% 41% RevPAR $197.40 $197.08 $213.95 $122.59 Revenue $2,294,750 $2,217,150 $2,487,168 $1,379,13731 30 31 30Sept October Nov Dec ADR $319 $379 $399 $529 OCC% 49% 65% 68% 75% RevPAR $156.31 $246.35 $271.32 $396.75 Revenue $1,817,103 $2,863,818 $3,052,350 $4,612,21831 31 30 31CATEGORY YTD AVERAGES ADR $539 OCC% 68% REVPAR $405.72 gross 4,573,634 total = 54,883,612From the data above, we can get a clear picture of how the different clock of year affects the hotels key measu res. Average Occupancy Levels for this segment have been estimated at 68%, which was estimated from the charts above. Many luxury hotels, including the Ritz Carlton, keep a relatively high occupancy through the year because of brand recognition and popularity. The ADR rates were estimated through the research of other competing properties in the area.The RevPAR was then deliberate by multiplying the OCC% by the ADR. The RevPAR indicates how well the Revenue managers did in optimizing the financial performance of the hotel. Luxury hotels such as the Ritz Carlton typically stay away from the â€Å"price fight” tactic of attracting business, but on slower months, doing this whitethorn actually increase your revenues and all the other key measures. Food and potableThe DiLido Beach ClubThe only oceanfront restaurant and lounge on South Beach with a relaxed, chic ambiance perfect for people-watching Ocean-table cuisine features a excerption of fresh local seafood, small plates, salads, sandwiches and a extract of homemade sangria Home to special events including the Down-home, Beachfront yell boil or D.B.C and the Far East spend Nights 1 Hours of Operation:Open seven age a week from 12- 8 p.m.Lobby Bar A chic, relaxed but vibrant gathering spot designed for socializing, sipping cocktails, enjoying light bites and people watching, located in the hotels upper lobby Live entertainment at this South Beach restaurant Friday and Saturday from 8:30 p.m. to 12:30 a.m. Signature cocktails by master bartender Ramsey PimentelBistro One LR Contemporary American bistro infused with Spanish flavors. Specializing in fresh, local seafood and exceptional steaks. Miami’s leading sunshine Brunch featuring delicious cuisine, unlimited mimosas, champagne, Bloody bloody shame’s and live entertainment every sunlight from 12 p.m. to 3 p.m. 1 Hours of Operation:2 Breakfast: 7 a.m. †11 a.m./Saturday and Sunday until 11:30 a.m. 3 Lunch: 11 a.m. †5 p.m. 4 5 Dinner: 5 p.m. †10 p.m.lapidus Lounge Lapidus Lounge, named after the famed architect Morris Lapidus †who designed the hotel when it was built in the 50s, serves specialty cocktails, light bites and sushi indoors amongst the sophistication and poolside under the stars.CompetitionAlthough the Ritz Carlton has the name recognition and the luxurious fortitude to be the top dog in its competitive set, the hotel still has a few direct competitors in the south beach area of Miami. These hotels include:1. SLS hotel south beach 2. The W south beach 3. Bentley hotel south beach 4. Z ocean beach hotelThese hotels are direct competitors to the Ritz due to their similar pricing strategy and their â€Å"suite style” rooms. These hotels do provide something that the Ritz cannot. Customized experiences. These hotels do not have the brand recognition and corporate structure so they can adapt to customer wants and needs on the fly. This is there main advantage in the marketpl ace. P & L overviewAfter careful review of the P&L statement, we can see that the rooms department generates the most total revenue for the hotel and food and beverage and Clubs and entertainment generate the rest of the revenue. Clubs and entertainment is very revenue driven, but lacks profit margin, so focusing on other areas is key for the Ritz. With the emergence of the mesh and mobile devices, it’s safe to say that telephone reservations are at an all time low, causation that department to bring in relatively low figures.The spa for the hotel is generally provided as a luxury for the guest but is not intended to be a moneymaking department for the hotel. Many times that service is deemed complimentary in which the hotel would incur a loss liter for that sale for the room. With fixed and strike expenses being as high as they are, the key takeaway from this is to maximize the room revenue and profits by providing a luxurious experience through all of the other d epartments.\r\n'