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The Pursuit of Quality

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June 01, 2012
Six Sigma
Bill Geoghegan - Bill@LGTConsulting.com

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Quality can be defined as meeting or exceeding a customer’s expectations.  This is the key dimension of a customer’s perception of value received. The customer’s level of expectation is initially set by the price the customer expects to pay for a product or service, and what he or she expects to receive in return.  This concept of quality applies universally to all products and services.

Within the hospitality industry, the service for which a guest is judging quality might consist of the room stay, dinner in a restaurant, a round of golf, the purchase of a cocktail, or any other transaction for which a price is paid.  While the value of each is judged individually, the overall quality by which a hotel, resort or casino is evaluated includes the perceived value of the guest’s entire experience. A poor restaurant experience will reflect on the resort as a whole, not just on that restaurant. A great restaurant cannot make up for a poorly maintained room. In the casino resort, the treatment of a player on the gaming floor becomes only a part of the overall guest experience. The personality of a resort encompasses all of the experiences of a guest.
Quality is not something that management can mandate or dictate. It is fundamental to an entity, and more a culture than a process.

Many years ago, one of the major automakers had a reputation for turning out occasional “lemons”.  After a consumer complaint about a specific vehicle and the ensuing investigation, it would be found that bolts or screws were missing, parts improperly installed, and occasionally a loose piece of foreign material was left to create a rattle inside the car.  While the vast majority of their cars were well made and had no flaws, those that did seemed to have multiple problems. There were enough of them delivered with these flaws to sully the overall reputation of the company.  When management launched an investigation to find the cause of these flaws, they could not find any issues with the production line or the procedures that were in place.  They found that the culprit was worker boredom.  The workers building the cars would entertain themselves by purposely creating “a lemon”, sabotaging a specific vehicle as a group effort.  One worker would leave a couple of screws loose; another might leave out a part or improperly install a needed component.  Needless to say, this was a group culture that had evolved over years, and it required a resetting of values by management and a modification to that culture.  The initial efforts to resolve these issues resulted in the adoption of total quality management as a corporate response.  This targeted both the production quality issues as well as the design of the processes in attempts to drive down costs. The automaker eventually instituted a Six Sigma program that has been highly successful in both increasing customer satisfaction and controlling costs. In its second year of implementation, that automaker experienced over $300 million in savings attributed to its quality program.

In the hospitality industry, setting the quality target of an establishment begins with decisions by management. Local competition and brand affiliation will dictate the price/value target. If a competitive price is most important, then the customer’s level of service expectation will be driven by the quality provided by the competition.  If the quality of products and services exceeds those expectations, then guest satisfaction, return rate and referrals will be high.  The quickest road to a business struggle will occur when that level of quality falls below the customer’s expectations, especially in today’s connected networking environment.

Every organization will experience mistakes and problems, but there are no successes or failures, only opportunities to learn.  Quality can be measured in the trend toward the reduction of those problems, but more importantly, in how those problems are handled. 

Although adopting a full blown Six Sigma program is overkill in a small organization, there is a lot to be learned from some of its basic principles, and how they can be applied in the hospitality environment. 

The basics of Six Sigma for an existing product or service are the five steps of:

  • Define the project goals and customer deliverables
  • Measure the process to determine current performance
  • Analyze and determine the root cause(s) of the defects
  • Improve the process by eliminating defects
  • Control future process performance 

The vast majority of customer deliverables in the resort environment are services. The defined goal is most likely a measure of guest satisfaction, but also meeting or maintaining an acceptable cost.

Measuring performance is difficult when the act of collecting that data might affect the performance itself. In a small organization, it is important that the staff must not be burdened with added responsibilities to collect data.  More often than not, the best method of measuring performance is customer surveys, but it is important that all guests (both satisfied and unsatisfied) take part.  Incentives such as future discounts or potential prizes might be necessary to entice the satisfied customer to respond, while the “comment card” method usually will be skewed toward negative remarks.

The major challenge facing management is staffing, both in terms of quantity and quality. Not only must the staff be expanded and contracted to meet the anticipated occupancy or attendance, but those staff members that do not get enough hours or income to meet their needs are likely to look for employment elsewhere. Management has a fine line to walk when trying to optimize staffing. Maintaining a historical analysis and understanding the demographic of upcoming attendance can help forecast staffing needs to provide the desired level of service.

In most cases, desired improvement comes from changes in management attitudes and employee empowerment. Engaging employees in the quality process means giving them more autonomy and freedom to do their jobs. This allows the person who is closest to the problem to handle a customer issue without the involvement of management, and will generally satisfy the customer. Guidelines in terms of this authority must be in place, and it is important that those issues are reported and logged.

Controlling the future process performance requires that the involved employees discuss methods to avoid repeating these issues in the future, and that the team is measured by its ability to reduce or eliminate those issues that have occurred in the past.  There is no value in placing blame, but rather in identification of the cause and the methods necessary to eliminate the defects.

In the big picture, understanding and exceeding your customer’s expectations is the most reliable way to ensure repeat guests and great referrals. Engaging and empowering the staff in the quality process is the key to achieving and maintaining that target.

Bill Geoghegan is a consultant in Las Vegas. He can be reached for comment at Bill@LGTConsulting.com.

©2012 Hospitality Upgrade
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