Read the Case Study – Putting on the Ritz Discuss the potential benefits of a program like this. Discuss the potential drawbacks. Is it a good idea?? Why or Why not.

Employees Putting on the Ritz at KMC:

Hospital workers allowed to spend $1,000 a year to improve patient stays

By Craig Welch

COEUR d’ALENE—Kootenai Medical Center plans to give all 1,000 of its employees the spending power of a hotel housekeeper. But not just any housekeeper—a Ritz-Carlton Hotel housekeeper. Starting Nov. 1, KMC’s top brass will let every hospital worker spend up to $1,000 a year to improve patients’ or family members’ stays or to help resolve customer complaints. The million-dollar move mirrors a program at the luxury hotel, which empowers all its employees to spend money without a manager’s approval. The idea: Keep customers happy.

“We do everything we can to try to never lose a customer,” said Amber Vierra, a spokeswoman for the Ritz in San Francisco. Joe Morris, the hospital’s chief executive officer, thinks that is a worthy goal for a hospital as well. Morris stole the idea from author and business guru Tom Peters, who lectured last month at Eastern Washington University.

“He told us about a housekeeper named Rosa in charge of the second floor at the Ritz-Carlton who had the authority to spend a couple of thousand dollars to please a guest,” Morris said. Morris ran with the brainstorm. Under his new program, radiologists could knock down a customer’s bill when it’s clear the patient had been overcharged. A janitor could buy pizza for family members waiting for grandma to come out of surgery. A dietician could pay for a cab ride for an elderly woman who can’t find a ride home.

“People want to have as much control of their work as possible,” Morris said. “Giving them authority to spend money is a symbolic one, and it takes care of needs of patients and family. That sends a good message to folks.”

Currently, he said, patients with billing complaints go through a billing department. It may be months before the complaint is resolved. Other examples abound. “Sometimes a person flies in to visit a relative and the admitting desk clerk says they’re not in here and we later discover they are in the hospital,” Morris said. Under the program, Morris said, a receptionist could apologize to Uncle Joe and perhaps pay for his hotel room.

At the Ritz-Carlton in San Francisco, receptionists frequently eliminate phone charges if customers can’t remember placing the call, said Vierra. “If another guest is making noise next door, we would relocate the guest,” she said. “If we didn’t have a room, we’d offer them another night’s stay free.” The hotel program aptly is named “instant guest pacification,” Vierra said. Morris is still working out some of the finer points of the hospital’s program. He wants employees to fill out reports explaining the expenses so the hospital can better track—and rectify—complaints.

And while 1,000 employees spending $1,000 each could cost $1 million a year, Morris says he isn’t concerned. “Everyone is not going to spend all the money,” he said. Besides, “if they’re correcting a mistake or problem, it’s something we should do anyway.” His biggest concern: Employees might be reluctant to spend the money. “I might have to do it myself just to show them it’s OK,” he said, laughing.