Customer-Driven Learning at Radisson Hotels Worldwide Radisson Hotels began in the early 1900s in Minneapolis by incorporating a partnership with the dry-good store which was next door to the hotel. For many years this wise entrepreneurial move summoned millions of people to the downtown Minneapolis area, greatly boosting the economy in this area (Hotel Online, 1998). By 1997, the “growth at any cost” strategy of Radisson was diminishing their quality and blurring the focus of customer satisfaction to align with hotel owners.
Radisson’s president, Brian Stage and executive vice president, Maureen O’Hanlon realized the detrimental effects this strategy had, not only on their hotel quality but on their brand image as well and decided to take several initiatives in 1997 and 1998 (Schroeder, 2008). These initiatives were to be more customer-focused and earn Radisson Hotels Worldwide the reputation of a “customer-driven learning organization. ” The model was to change from “growth at any cost” to “champion of the guests. ” To make this change, the 100% guest satisfaction guarantee program was devised.
It was the responsibility of Sue Geurs, recently appointed Director of this program, to improve Radisson’s overall service quality through analysis of all the factors that affected operations, e. g. financial justification, marketing with technology. To support this new strategy, a fully integrated guest information system was developed that included the three “pillars” of information technology as described by Schroeder (2008); the Curtis-C system worldwide distribution (reservation) system, the customer database (Customer-KARE Systems), and the Harmony property management system.
In 2007 Radisson had 400 hotel locations in 63 countries where they had implemented several initiatives with the goal of obtaining and retaining satisfied customers. Although this proved to be a success, O’Hanlon and Stage questioned if there were other avenues that they should be pursuing to improve and accelerate their “customer-driven learning” efforts (Schroeder, 2008). A standardized process of quality planning, control, and improvement must be the norm, especially considering the various hotel locations of Radisson. They might have to revamp processes or programs to account for differing cultures.
Many programs for measuring guest and employee satisfaction were implemented, studies found a strong link between employee satisfaction and guest satisfaction, just as with the Ritz Carlton and their Gold Standards. The Gold Standards has six topics; the credo, the motto, the three steps of service, service values, the 6th diamond, and the employee promise (Ritz-Carlton, 2008). The Radisson should focus on these key principles to be the “champion of the guests”, while finding a way to differentiate themselves from other luxury hotels.
Radisson should implement their service guarantee in writing, possibly including it with their mission statement, as a rule in the employee handbook or as part of their motto for guests to be aware of their desire to satisfy. It is imperative for employees to comprehend the value of service and how it relates to the customer. The employee understanding of these standards has been proven to directly correlate with guest satisfaction (Schroeder, 2008). If the principles or expected standards are a part of the employee handbook, they will then function as a guideline for the employees.
This will help to avoid ambiguity and misunderstandings, which could lead to dissatisfaction. Employee empowerment plays an important part in customer satisfaction; employers should enforce and support empowered actions. It has been shown in various studies that a happy employee will be more apt to provide excellent customer service than a disgruntled one. To achieve this, a well-structured training program should be in place for employees to understand the importance of the vision of Radisson Hotels Worldwide as “champion of the guest. The information technology initiatives to support Radisson’s strategy that Scott Heintzeman, VP of Knowledge Technologies for Radisson, implemented include the three “pillars”. These systems are: Curtis-C system worldwide distribution (reservation) system, the customer database (Customer-KARE Systems), and the Harmony property management system. Information systems help gather vast amounts of information (e. g. guest profiles) and store it in a database. According to Erik Lars Hansen and Raymond Owen (n. d. ), there are two main areas that an information system can help achieve.
One would be to improve the overall guest experience through more efficient and expedited registration, this includes departure as well as arrival. The other area would be to improve operating efficiencies (e. g. staffing resources, administrative expenses, centralization of functions to improve effectiveness). Both of these areas are allied with each other, and the information system will aid in the integration. The challenge is to be able to choose the right information system, and Radisson’s three “pillars” technology approach seems to be quite effective.
A prevalent measure of service quality and one of the most popular is SERVQUAL. O’Hanlon and Stage might consider the use of this service quality system in which a customer questionnaire can be incorporated with Radisson’s Customer-KARE Systems based on the following five perpetual measures of service (Schroeder, 2008): 1) Tangibles- which includes the appearance Radisson’s physical facilities, equipment and personnel. 2) Reliability – expresses the ability of Radisson to perform the promised service dependably and accurately without errors. ) Responsiveness – this is the willingness of Radisson to provide service that is prompt and helpful to the customer. 4) Assurance – the knowledge and courtesy of Radisson’s employees and their ability to convey confidence and trust; employee empowerment is measured here. 5) Empathy – the caring, individualized attention Radisson provides to its customers. To improve and evaluate employee satisfaction these same measures may be used where the tangibles include a clean work area and an employee break area.
Reliability and responsiveness may reflect upper management’s ability to provide the necessary support in empowering the staff and their response to employee concerns or issues. Assurance that employees are treated fairly and within Radisson’s standards and empathy, where management recognizes the value of the employees and provides incentives to increase the motivation. For Radisson to drive commitment to service quality through their franchise organization successfully, it is necessary to train employees at all levels on Radisson’s quality standards.
Radisson must make all parties involved aware of the benefits of implementing said standards. Reports reflecting Radisson’s improvement over the last decade should provide the proof of how successful it has been. Empowering employees to be part of the solution will provide a sense of ownership and pride and enable them to feel confident in dealing with the guests. This should lead to higher standards of customer service and quality actions. The method above reflects how Radisson should align the goals of the management team, hotel workers, owners, corporate management, and corporate staff with their new brand strategy.
Awards, at any level, whether it be company or national, have the core function to motivate all parties to meet a common goal; at the same time prompting the company to be the best. Pretty much all incentives promote motivation, whether, in the form of monetary value, certificate, comp time, or prizes, etc… By working together and customizing their strategy to fit their industry, the organization should not only sustain but succeed. Carlson Companies already has some recognition programs in place, such as the Gold Bond Stamps that had been given away in grocery stores to promote customer loyalty (Schroeder, 2008).
There is always room for improvement regardless of whether you receive an award for being the best. Radisson must strive for continuous improvement with the three information systems as well as with their programs for measuring guest and employee satisfaction. Since guests are their revenue generator, it is in Radisson’s best interest to develop programs that promote understanding of guests satisfaction. Frontline employees are one of the chief ingredients in the recipe for customer satisfaction. If employees are unhappy, this will be reflected to the guests.