Jordan Raynor sits down with Horst Schulze, Co-founder of The Ritz Carlton Hotel Company, to talk about the world’s best hotels, how he thinks about loving every employee as himself, and why Christians ought to have the highest standards of excellence in our work.
Jordan Raynor sits down with Horst Schulze, Co-founder of The Ritz Carlton Hotel Company, to talk about the world’s best hotels, how he thinks about loving every employee as himself, and why Christians ought to have the highest standards of excellence in our work.
[0:00:05.3] JR: Hey, everybody. Welcome to the Call to Mastery. I’m Jordan Raynor. This is a podcast for Christians who want to do their most exceptional work, for the glory of God and the good of others. Each week, I’m hosting a conversation with a Christian who is pursuing world class mastery of their craft, of their vocation. We’re talking about their path to mastery, their daily habits and routines and how their faith influences their work.
Today, I am beyond excited to share our conversation, I recently had with Horst Schulze. The cofounder of the Ritz-Carlton Hotel company. If you love travel, if you love great hotels, you know that brand undoubtedly. Back in 2002, Horst sold the Ritz-Carlton to Marriott and then cofounded the Capella Hotel Group which has built some of the world’s most fantastic hotels. Most recently, Horst published a book called Excellence Wins, which is a master guide to entrepreneurship and leadership. I devoured the book in two days.
Horst and I sat down to talk about the book, talk about how he thinks about loving every employee as himself and why he believes Christians ought to have the highest standards for excellence in their work. We also talked about what it’s like to live in a hotel that you’re running and for my fellow children of the 80s and 90s, you’ll appreciate that throughout this entire part of the interview, all I could think about was Dunstan Checks In, in my childhood dream to be Jason Alexander living in and running a hotel at the same time with the monkey on the loose, but that’s neither here nor there.
This is a great conversation. I think you’re really going to enjoy this episode. Without further ado, here’s my conversation with a truly masterful entrepreneur, Horst Schulze.
[0:01:53.5] JR: Horst Schulze, thank you so much for being here.
[0:01:56.6] HS: I’m delighted to be here.
[0:01:58.1] JR: I’ve really been looking forward to this conversation for a bunch of reasons. First and foremost, I read Excellence Wins in two days. I devoured the book, I actually read it at a Ritz-Carlton property. I did, in Sarasota and I absolutely love the book, I have a bunch of follow up questions. Second reason why I’m interested in this conversation is, as my listeners know, my last startup was actually in the travel industry. I still serve as chairman of the board of that company called Threshold 360, I have a particular interest in hospitality.
The third, I just love great hotels and I know you do too. Let’s start there. I’ve got a world class hotelier on the phone, I’ve got to ask you, what’s your favorite hotel in the world and let’s start with one that you don’t have an affiliation with? No Ritz hotel, no Capella property, what’s your favorite hotel?
[0:02:49.8] HS: The Huka Lodge in New Zealand.
[0:02:51.9] JR: Yeah, I’ve never been. Why is that your favorite?
[0:02:55.1] HS: It is just – you don’t know why you feel good, but you feel great there. You know how that is, I mean, I always say, if you can say “I like this hotel because the food was good, the rooms are nice,” that means all the rest are seconds – but in this case, it’s marvelous and I can’t tell you. I was there one night because I was in the area on business and I said, whatever it takes, I have to bring my wife here once because it’s also the most romantic feeling place. I managed to take my wife there and she agreed, it is just beautiful, it is a sensational setting, sensational food, the individual setting, have dinner there by all means, if you ever got there, you have to have dinner there because they have 18 different venues to have dinner.
Very romantic venues with fireplaces outside, inside, it is just exceptional.
[0:03:44.7] JR: All right, I’ve got to go, my wife and I have been talking about New Zealand, so that’s where we’ll have to stay whenever we go. Okay, what’s’ your favorite Ritz or Capella property? I understand this is like choosing a favorite child, so this is probably a hard question.
[0:03:57.5] HS: Well, I really would have a hard time answering that because you know, I’m a hotel fanatic, I’m in hotels since I’m 14 years old. Whenever I’m in the hotel, I nearly always say, “I would like to run this hotel,” for some reason. I just came back last night and from Indonesia and I was staying in a hotel that wouldn’t physically be the nicest, but I would like to run it because of the wonderful people that work there. You know?
In some of the islands in Indonesia, the people are so hospitable, and I said, “I would love to run this hotel with these employees, what I can do, with these employees,” I thought. Of course, I don’t want to run another hotel and having said that, I think maybe in a city hotel I would lean toward where the Capella in Dusseldorf Germany, it’s actually called Breidenbacher Hof, whatever that means. But it’s a Capella hotel.
It is just class, it is outstanding. Just to give an idea, the top box the intent of return is 97%. I mean, it is just not possible nearly and even though the average stay is less than two days and nevertheless, 97% say, on a scale of one to 10, nine’s and tens. I want to come back and I want to recommend you.
[0:05:14.9] JR: I’m not surprised at all to hear you say that what gets you excited about the idea of running another hotel is the people. I mean, people are really central to Excellence Wins and your philosophy on leadership and management. I’m sure your faith influences that and we’ll talk about that in a second.
One follow-up question to that, you sound like what gets you excited isn’t so much the development of new properties but it’s actually running the hotel, right? And being the operator.
[0:05:41.7] HS: Yeah, I’m an operator by heart. I literally grew up in the business. I’m an operator by heart and of course, as the career moves on, I was eventually running Ritz-Carlton. I started in Ritz-Carlton, I still operate it, been running it for 19 years and then started another hotel company, Capella. I’m not running the hotel anymore, but I’m closely connected to it. I always make sure that I’m closely connected to the employees as a whole.
[0:06:09.4] JR: You mentioned you grew up in the hotel industry. This is something I didn’t know before reading the book and I just think your story’s really interesting. Tell us a little bit about your story and the path that led you to this wildly successful career in the hospitality industry?
[0:06:24.4] HS: I was growing up in a small village in Germany right after the war. Nobody went into the hotel business line and there was no hotel. Nobody in the village ever went into hotel business and it was not honorable in fact. You went to technical jobs, but I wanted to go into the hotel business from 11 years old, I don’t know why. I must have read something because I’ve never been to hotel and there was none in town. I begged my parents, they found out how to support a career and hotel business, found the best hotel in the region, which unfortunately was a hundred kilometers away. At that time, very far and they got me a job there as a bus boy. Bus boy meant washing dishes, cleaning shoes, and so on.
[0:07:02.4] JR: That was your first job in a hotel? You were a bus boy?
[0:07:05.0] HS: That was my first job.
[0:07:05.9] JR: How old were you there?
[0:07:07.0] HS: By the time I got there, I was 14. Living in a dorm room, working many hours every day and once a week I went to hotel school and that is a typical German career, unless you go to college. I did that but I was lucky. I mean, I was kind of ridiculed going to work in the hotel in the village. In fact, my grandfather was very embarrassed, and this is a low-grade job.
When I got there, there was a manager who welcomed me and said, “Never come to work to work, come to work to be excellent in what you're doing.” Well, that went over my head when I was 14.
[0:07:43.1] JR: Sure.
[0:07:43.9] HS: What is so excellent in cleaning ashtrays, washing many dishes and so on. But he went on telling me that and that’s kind of the fundamental of my whole career happened right there. Two years in, I went to hotel school and I was supposed to write an essay about what I feel about the hotel business. I went back thinking about it, I saw the manager in the dining room, as he approached the table, I saw, I realized for the first time, I realized also, that was true always.
He went to a table and the guests at that table were proud that he came to them. Now, I had been told, that very important ladies and gentlemen come to this hotel. My parents told me we could never go there. This is only for very important ladies and gentlemen. In fact, I was told that in the hotel right away.
Now, wait a minute, there was a reversal, those important ladies and gentlemen were proud that he came to the table and I noticed that was true all the way around and for the first time, I realized because he defined himself as a person of excellence. He was a person of excellence.
I mean, he would have never entered the room unless he looked perfect. And everything, even his teaching was excellent. I wrote my essay around him and I named that essay, We Are Ladies and Gentlemen, Serving Ladies and Gentlemen. Meaning, if you're excellent with what we’re doing in our service, ladies and gentlemen, we will be respected, if we define ourselves as ladies and gentlemen, now, this was a major success essay. I got an A, never had one before.
Literally, it really stayed with me and I made that the motto of Ritz-Carlton when I started Ritz-Carlton. We are ladies and gentlemen. Unless we sentence ourselves to be servants by not being good in what we’re doing but if we’re excellent in what we’re doing, we are ladies and gentlemen and our profession is service to ladies and gentlemen.
[0:09:47.3] JR: I love this.
[0:09:48.0] HS: I feel that very strongly.
[0:09:48.7] JR: I love that so much, I’ve got so many questions about this “ladies and gentlemen serving ladies and gentlemen” mantra because you're right, there is that level of excellence that distinguishes us, especially in the hospitality industry, right? As ladies and gentlemen. But there’s also just a God-given dignity to every human being that, I would imagine, and I’ve obviously I’ve never operated a hotel but I would imagine that, you know, a lot of the more entry-level positions, the bus boys, the valets, aren’t always treated as ladies and gentlemen.
Those jobs are aren’t always seen with the highest level of dignity and one of the things I respect so much about Ritz-Carlton and Capella and your work is you’ve elevated every position within the hotel to give it great dignity and meaning, right? Can you talk for a second about how if at all you’ve thought about how your Christian faith has influenced that thinking?
[0:10:42.8] HS: Of course, it influenced that thinking. I mean, everybody, the employee is pretty close to you, how about that? He is a neighbor. Love your neighbor as yourselves. Consequently, you make sure that you have to also make sure that a guest is satisfied because let’s face it, what is the product in the hotel business? It’s the moment my employee admits the guest, that’s the product.
[0:11:10.1] JR: That’s the product, that first interaction.
[0:11:11.2] HS: I don’t build mattresses. I don’t build anything. I only manage that interaction, of course, you make some food and so on. If that is true, I have to make sure that my employees are the right employees. I make sure I select right and then invite them – that’s the issue that I really have a problem with in general. Let’s face it, companies hire people to fulfill a certain function.
Now, the chair in which you’re sitting is fulfilling a function. But we hire human beings, we hire our brothers, so I have to make sure that I select them right, of course, but then I say, I offer them to join a purpose not only a function. The purpose for us is very simple. The purpose of our business is to become respected as the finest in the world in service delivery. That was the purpose from day one, that’s why we created Ritz-Carlton to make sure of it and to understand that’s our purpose.
I invite every employee to join in that purpose. My new – I question this purpose, I question myself thoroughly, is this good for the investor? Is it good for the society as a whole? Is it good for our guests and is it good for employees? The answer was a resounding yes in all cases. When I ask somebody and say “Okay, join me in that.” Yes, now you have an objective, now you have a purpose working and please come to work with that purpose every day.
Yes, the motive for the company, why we have that purpose – and then I connect the motives of the company to their own motives. That is the honorable thing to do with a human being, not just giving them a job here and just fulfill this job like a machine.
[0:12:57.3] JR: In my upcoming book, Master of One, I talk a lot about how it is through this ministry of excellence that we love our neighbor as ourselves. But I love how you put it in excellence, ways of thinking about employees as neighbors, a lot of times they’re our closest neighbors and yet this one line in the book, that really stuck out to me, I love how succinctly you put this. You talk about your quote, “Call to value the humanness of the employee.”
And then you go on to describe this speech that you give at each orientation for new employees when you are operating these hotels and telling them that every single employee, whether they’re the GM or the bell hop or the house keeping staff, everybody’s job is important, every human is valued, every employee is valued.
Can you tell us how you use that speech to communicate the meaning that you see in each and every person’s job?
[0:13:51.2] HS: Yeah, of course, I tell them first of all, you are not servants here. We’re ladies and gentlemen serving ladies and gentlemen. You have to understand that for every Ritz-Carlton hotel. I went there for the orientation of the new employees, whether in Shanghai or Philadelphia or Germany or Osaka, it doesn’t matter.
I opened the hotel in West-end for 10 days training of the employees. The first meeting of course, in a room, it’s kind of significant to every employee, they’re sitting in a big room for the first day, they’re starting a new job in these beautiful surroundings and there’s the president of this world-known company and there was me. I walk in and said, “My name is Horst Schulze, I’m the president of the company and I’m very important.”
Of course, there goes kind of a shock through the room. I said, “Yeah, I’m very important as a human being but so are you. In fact, only a fool would differentiate in the importance of human beings. You are an important human being. Period. We all are.” Then I go on and, “What about your job? Well, if you don’t come to work, the day they own the hotel, or any day later, you don’t show up and we don’t wash dishes, we don’t make beds, we don’t check people in, we don’t cook food. We have a disaster. Your job is very important and by the way, if I don’t show up, nobody will even know.”
[0:15:17.1] JR: Right, that’s exactly right. The humbling part of leadership, right?
[0:15:22.8] HS: This is a reality. I want them to understand it. I want them to understand that they’re important.
[0:15:30.9] JR: Yeah, absolutely. One of my favorite stories in the book, you talk about the opening of the first Ritz-Carlton in Montego Bay, Jamaica. You talk about some of the things that other hoteliers were telling you what to expect of employees coming down to Jamaica and then talk about that, and then talk about what happened the next day after you delivered that speech on day one?
[0:15:52.2] HS: Yeah, that was really a moving moment. I made that speech, “Ladies and gentlemen, serving ladies and gentlemen” and I expect them, all these things, the first day. When there are other orientations that are going on and then they go all home and have to come back the next morning. The next morning, I’ve been jogging which I did every morning around by the white beach golf course, if anybody knows the area, and I jog back and I see people walking in very fine dresses and suits.
I wonder, my goodness, had they gone to a wedding early in the morning or a funeral or whatever. As I get closer to the hotel, I realized, these are our employees entering the hotel. They took my comment so seriously. Now, before that even happened, I talked to fellow hoteliers, yes, about opening a hotel in Jamaica. They gave me horror stories about those employees.
They say they steal, lie and cheat, don’t come to work, very lazy. All those things that they told me I was really worried in opening that hotel. Here are those beautiful people, those fine ladies and gentlemen, reacting to me saying, “You are ladies and gentlemen. You are important.” They dressed up in what they thought was according to being ladies and gentlemen.
It turned out they were just wonderful, they were just great employees. I never understood in retrospect, why that terrible experience, some other hotel they had. It still gives me nearly chills when I think about it, how wonderful they all were.
[0:17:28.2] JR: What a beautiful scene to see all them coming to work that way the next day. You know, just goes to show, if you’re following the gospel of Jesus Christ, following the advice of Jesus Christ in business, pays off. Not only are we being obedient to Jesus’ call to give dignity and worth and value to every human being and to love every neighbor as self. But it also produces some pretty good results in business, is that right Horst?
[0:17:50.7] HS: Absolutely. I whole heartedly do agree with that. I’m like, goodness, here, as Christians, reading the bible and we read very clearly this amazing word by Jesus, the number one direction is love your god and then love your neighbor as yourself. How can I possibly ignore my employee and put them not in that category? I tell you I have a philosophy anyway. I got to work for two reasons. One is to create excellence in what I’m doing. Not just for function.
I create excellence. Number two is to be with my friends. All of them.
Now, that doesn’t mean I barbecue in the office, I have to respect them and treat them as my friend. I enjoy seeing them. As I said, I just went to visit several hotels that are still connected to Capella and some other hotels. And seeing those employees is, what a heartwarming situation, I see employees that started in service, that are now mangers and there’s nothing more fulfilling, that’s when I feel I was successful when I see that.
[0:18:55.1] JR: Yeah, that’s great. If there was a title for this episode, I think it would have to be “Love your employees as yourself.” One more follow up question there and then I want to come back to your story and kind of close the gap from age 14 to today. The question on the employee thread though, loving your employees as yourself, you know, one way you do that is simply by showing them dignity in your words by telling them that they are ladies and gentlemen serving ladies and gentlemen.
But in the book, you also talk about a lot of other practical ways in which you treat employees differently than other hotel management companies in the hospitality industry. Talk about some of those other things that you guys do differently with your employees at Ritz-Carlton and Capella that others in the hospitality might not do.
[0:19:38.1] HS: Everybody talks today about two goals in a business which, and sometimes it’s pathetic, I’m sorry, forgive me how much we talk about it and then you look around and it’s not happening. Number one is alignment. Alignment is a big buzz word. Then you talk to employees and ask any of those employees, if anyone comes and talks about alignment, what is the company thinking?
Where is the company going to go and what’s the plan? They have no idea. What are they aligned too? Every employee has to know what’s our purpose? Everybody then understands why that purpose and everybody understand what’s the customer expecting from us? That’s alignment. The other word that’s being used is empowerment. Empowerment also a buzzword and nobody dares to do sense, and the other word of course is open door policy and everybody is afraid going through the door that is open, but nobody’s afraid to go in.
Come on. Empowerment, yes, what we did had empowerment. Every employee had a right to make a decision up to $2,000 if it was about taking care of a customer that had a problem potentially. We instituted that when we had about 15,000 employees at the time and that takes some training but every employee has a right.
Because, if you have a problem as a guest, you don’t’ want them to say, “I’ll call the manager,” you want them to react and say, “Please forgive me.” We told our employees not only that. If you feel that we should make amends, you can make that decision up to $2,000. That is stated to our employees that we trust them. They are just work in there for filling information. But they’re trusted human beings.
[0:21:19.2] JR: They take pride in that, right? They take pride in having that level of ownership, so I mentioned before, my wife and I were down at a Ritz property in Sarasota a few weeks ago, we actually go down there, we live in Tampa, we go down there almost every year for our anniversary and always have an exceptional experience. I love the property there. This is the first time in I think seven years where there was one minor thing that wasn’t perfect, and it was significant enough to where I felt like I had to tell somebody.
I went up to the concierge, it wasn’t the concierge’s fault at all, but immediately, he apologized, or he didn’t shift blame to “Oh yeah, the pool staff is you know, sub-par.” He accepted responsibility and he felt empowered to make things right. He said, “Champagne up to the room,” and did some other things for us at dinner.
I was so impressed, Chris, the concierge.
[0:22:07.9] HS: He’s empowered, that’s right.
[0:22:09.2] JR: He was empowered. You could tell he was proud to do it, right? It wasn’t a chore to him, it was his job to serve the customer well and he did it really well. Of course, let’s go back to your story.
[0:22:21.1] HS: Just to be sure, we don’t just say that, every employee is certified in problem resolution. That’s why they know how to handle the situations and then are empowered to react. I’m sorry just –
[0:22:35.7] JR: No, that’s super interesting. Speaking of that, the follow up question to that, did you guys develop your own curriculum?
[0:22:41.5] HS: Yeah.
[0:22:42.7] JR: Help me understand something Horst, you have no experience in the hotel industry, age 11 you decide you want to work in a hotel, age 14 you start this amazing apprenticeship. How do you go from there? This kid from this small town in Germany to cofounding two of the great hotel brands of our time, right? So, you went to go work at Hyatt for a while, is that right?
[0:23:06.8] HS: Yeah, well at first coming from there as a young man, I thought them truly the finest hotels in Europe and the Board Walsh Palace and those on Bellevue Palace and then Class Appne Ferris on the mega line and the Berkeley in London and then it came to the United States and pretty soon worked in the Hilton in San Francisco and so on and worked in a private club in between, worked for Hilton again.
It got started in the Korea movement in Hilton became food and beverage manager. Joined Hyatt and opening Hyatt in Chicago and I opened it as the director of food and beverage operation, became the room’s manager about two years later, became general manager and you read in the book about Pittsburgh, that was a great experience. Then moved on as general manager in a large Hyatt in Detroit, Michigan and then became regional vice-president for over 10 hotels in that area.
And then became vice-president of food and beverage over all the United States 65 hotels at a time for Hyatt. Now somebody called me – and I must say I had a stellar career frankly with Hyatt and it is a wonderful company and I enjoyed it very much – but somebody called me and said that they were starting a new hotel company and because they have two attempting construction they cannot come to agreement with any existing brand.
So they want to start their own brand and then the investors and developers they are looking for somebody that runs the operation, starts the company, managing the operation. They told me I could do what I wanted in operations. I said, “Well I want to go top line” and they said, “That’s fine.” So, I moved to Atlanta and talked to them because I had a dream to create my own, the best hotel company in the world and frankly, I didn’t know what to do.
I started to say no to them but then my wife saw I was interested because of that dream, that creating that finest hotel company in the world, but I was happy –
[0:24:57.4] JR: I bet you were pretty comfortable as a VP at Hyatt.
[0:24:59.4] HS: Yeah, very. I mean golden handcuffs, everything you want and I was a young star at the company and we prayed that one door would close and one would stay open and sure enough, something had happened and they called me again from Atlanta and I accepted the job. I went to Atlanta, frankly, the first two years were disastrous, and it was very difficult and I mean it was a disaster and it looked like we are not going to make it.
So, I went home, I didn’t tell Sherry, my wife, because we couldn’t sell our house in Chicago. We had a lot of debt, we had a new baby coming around and she had enough to carry but finally I had to because the company wasn’t working. So, I went to her and said, “Sherry I think we made a mistake moving here. I have to tell you the truth,” and she looked at me, “Why would you argue with God?” We prayed on it, we had a clear answer, here we are.
Maybe it doesn’t work out, but we didn’t make a mistake moving here and God told us and I said, “Well Sherry, I will never argue with God again in front of you.”
[0:25:57.1] JR: At least in front of you right?
[0:25:59.4] HS: At least in front of you, so.
[0:26:02.2] JR: That’s fantastic. So, you came up through food and beverage, that’s interesting, and at some point, maybe next time I’m in Atlanta. I want to talk about how you start up a hotel brand because there is so much capital involved and there are so many different players from the brand and the chain, to the operators and developers and investors. I am a tech startup guy, I have started and sold a couple of software businesses. Those are the easiest businesses in the world.
To start up a hotel is infinitely more complex, but again, we don’t have time for that today. One question I did want to ask though is about just entrepreneurship in general, right? So, Ken Blanchard world-renowned leadership expert, has said that out of the hundreds of top CEO’s he’s worked with, you are quote easily in his top five. That blew my mind. That is quite the statement. So listen, you are a world-class entrepreneur. What do world-class entrepreneurs do that they’re less masterful counterparts don’t do?
[0:27:02.6] HS: I am not talking about myself. I would say world-class leaders, I have developed a model for it if you will, because I looked at it long time, who are the leaders, who are the managers. World-class entrepreneurs aren’t great leaders, first of all. Okay, they are leaders and managers force things to happen. They establish what has to happen, they oversee it, they direct it, they control it and so on.
Leaders point to a create purpose, to a create vision. The leader sees something beautiful in the future and everything that happens in the organization is toward that future. The way you hire people – and again, I mentioned before, the leader truly knows that future is good for all concerned as I pointed out, employees, owners and so on. Now in that moment, once I totally know as a leader that it is good for all concerned, that gives my direction for managing.
That doesn’t mean I cannot compromise with one employee because I don’t hurt all employees and then I cannot compromise not to be excellent with every guest, etcetera, etcetera. So it directs me, so that model is kind of heaven occurred vision. Be committed to the mission, be committed to it, not a pipe dream, and next institute the steps that gets you to that vision. Once they can see where they want to be, then you know the roadmap that you have to develop to get there.
If you don’t know where you want to be, how can you develop the roadmap? How can you have the plans, really? Finally, keep focused on it because I learned that everybody once you have set the vision, everybody finds a reason why maybe it is not possible, why it cannot be done, why not under the circumstances, etcetera, etcetera. It doesn’t matter to the leader, the leader focuses on the vision, on the purpose and constantly focuses on the fact that it has to be good for all concerned.
So, in this moment, I know how to manage the employee, I know everything, I know what decision to make. I have to get up in the morning and no matter what is happening, I have to look at my vision again even if it looks hopeless, which I had for a moment. I mean when I talked to my wife and she said, and I immediately apologized and said, “Yeah, that’s right. What am I doing?” in not focusing on the vision and of course the rest is history.
We became the number one hotel company in the world voted for years. We are voted number one by everybody that votes in the world. It is all because we had the vision and the dream, and we make sure that we have a work environment that people joined that vision and they didn’t just come to a job. They had the purpose. I mean come on, Aristotle said already, “People will perish without purpose.” The Bible says, “People will perish without purpose.”
Aristotle said, “You will not be fulfilled without purpose.” We all have to have our earthly purpose but we have to incorporate our eternal purpose in it. Of course, is it good for all concerned, also includes you have to question yourself as a Christian, would Jesus agree with this? If you don’t do that where are my values as a Christian?
[0:30:06.2] JR: That is exactly right. I love the chapter in the book where you talk about the difference between leaders and managers. I thought that was really good, and one thing I have thought a lot about. So I currently served as chairman of the board of a tech startup called Threshold 360, where we’re on a mission to map out the inside of every public location in the world using 360 imagery and we have done it at a greater scale than anybody, except for Google, in the world.
They’ve got about 250,000 hotels and restaurants, jumps and attractions. Yeah, it’s a really fun venture, I ran it for two and a half years day to day as CEO. One thing that we talked a lot about was the vision always remained intact, right? So the vision for the venture –
[0:30:44.2] HS: Cannot change.
[0:30:45.2] JR: Yeah, cannot change or allow anybody –
[0:30:47.9] HS: Hey, I mean people could change –
[0:30:48.7] JR: Right, people would change and even strategies.
[0:30:51.8] HS: Everything changes but not the vision.
[0:30:53.8] JR: But not the vision, that is exactly right. I think a lot of entrepreneurs and leaders have trouble with that. They see change in circumstances and a change in competitive landscape and they feel like that means that they need to change the vision, the horizons of the venture, and I found that to be really bad advice, right? Maybe change strategy and tactics and team, so long as that vision remains intact. Do you agree with that Horst?
[0:31:14.4] HS: Absolutely. You know everything else may change but the vision will not change and your overall philosophy, that means your culture will not change but strategies, tactics, your tools, everything will change but not your vision and your culture. That will not change. That you have to keep intact.
[0:31:32.6] JR: Yeah that is good. That is good advice. So, I am really curious. I love studying the routines of high performers especially those who love Jesus. Maybe take us back to your days running a hotel, being a GM, maybe that hotel in Pittsburg or whichever you think is most applicable. I am just curious, what does a typical workday look like for a GM? Walk us through that daily routine.
[0:31:57.1] HS: Okay, I just saw them going to their – what’s interesting more or less turning their hotel around. In a large hotel, I had an apartment in the hotel, married, my wife was there and so we have the class elevators coming down from the 11th floor and so I am going in the class elevator in the morning early and I know, we have a check out of about 400 rooms and check in of about 500 rooms. I know I have a luncheon in the ballroom, in the large ballroom of 1,400 people at noon. In the same room I have a meeting starting at 3:00 and the meeting planner had heard about that but is already upset with me. But I thought I’d take a chance and I know in the evening we have a wedding, Mrs. Goldberg’s daughter is getting married and I am in the glass looking down at the coffee shop and I see a line of about 50 people staying there and I think about all this stuff that happens today. I think I hope that everybody showed up in the coffee shop and I hope the cook showed up. So, by the time the elevator lands on the first floor, I am already perspiring.
[0:33:00.6] JR: Right because you are watching it all unfold in the elevator ride.
[0:33:04.8] HS: All is going to attack me this day. I go to the office and then I look and the hotel indicator, same thing. Is there anything new with the customer satisfaction, employee satisfaction? What did we do last night? What was the order, what was delayed? And all of the stuff and what’s coming in.
[0:33:18.1] JR: So, your first thing and I am sorry to interrupt, so your first thing when you got into the office you look at the data right?
[0:33:22.9] HS: I look at all the data. There is much more data in a hotel and then of course, the next thing is my meeting with the key executives, we review the day. The next thing that we do – and then I say, I stop the executive meeting. We just sit for an hour in our office, but I stop and 15 minutes before, part of the meeting is that everybody walks throughout the hotel and says a very friendly “Hello” to every employee that they encounter.
Inter-personal relations, establish that relationship together. I can’t have it for a thousand employees I can’t have it for every employee, but we all have to go around, encounter them, look them in the eyes and say “Hello.” But otherwise, we role play for them how you should say hello to a guest in a way. So, you make it 15 minutes then everybody is in their work areas, you know food and beverage, rooms, everyone is in their work areas and then it goes back to the office and you see you have mail, what is the issue today? Is anybody’s suing you? You know, literally look at all of the issues, what are the issues of the day and respond to the issue for the day. We have meetings with lawyers, we have meeting with financial people, and the next thing is I typically, after everything is done, I go to the sales department and ask directly, “Can I support you in any sales that you have a problem on?” May I personally call the meeting planner and say, “I commit myself personally. This will be a meeting on…” or whatever.
So, then you of course, you got back, you check in what’s happening and then you check with them, from this, how is the check-out happening? Are we ready for 500 check ins? Every check-in today? Well remind you, we have an average of check in and check out of that hotel of 375 rooms, every day. So, there is miniature organization going on and miniature work going on. In the meantime, you’re having the executive –
You made sure that all departments have functioned well, they are all set, you’re functioning well and then of course the meeting planner comes in, who has the meeting at 3:00, he is very upset because we have a luncheon in that room and he said, “You will never be ready, how can you be ready with that room? You have to set it the way I want it?” because his job depends on how the meeting is going but the meeting breaks at 2:00. Then in the meantime we mobilize every free person that can take free – every secretary, everybody goes in that room and resets the room for the meeting and the meeting planner comes to you and says, “Wow I have never seen anything that professional,” so you’re happy.
[0:35:46.0] JR: For those that don’t know, I am actually pretty familiar with this meeting planner you’re talking about. So, at Threshold 360 we sell to a lot of hotels, a lot of hotels as customers all around the world and destination marketing organizations, DMO’s, right? So, for those of you who are listening from San Francisco Travel, Visit Dallas, these types of groups. One thing I have learned from that experience is meeting planners run the hospitality industry.
These people are booking 500 peak room nights at a time, 1,500 peak room nights at a time they’re what drives these hotel businesses. When you hear Horst talking about the importance of the meeting planner, these people really do make the world of hospitality go around.
[0:36:22.2] HS: That’s right.
[0:36:23.0] JR: So Horst, I am curious, you have a crazy day as soon as you get down that elevator you’re in the thick of it. How did you stay sane through all that and what were some of your spiritual disciplines that you used to maintain your perspective?
[0:36:37.3] HS: Well you start off the day, and I meditate with God, with Jesus and ask him to support me, to be with me, to make sure that I show it. I promise myself then I am going to work now to create excellence in all that I am doing. I promise that to God. It’s embarrassing to me that we as Christians don’t run the finest product that is ever created in any business.
[0:37:02.8] JR: I couldn’t agree more. Why do you say that?
[0:37:05.3] HS: We should be the example. My goodness, we work with the best support system that is our God and the best belief system and if you have the best belief system, you can run the best business. That is to me quite clear and I am confused why that is not true. It bothers me all of this by the way, but I am also of course a type A personality.
I was driving on the intensity of competition, the intensity of the day. Mind you the day is not over, now I have to look forward to Mrs. Goldberg’s daughter’s wedding! I mean my goodness. I mean she is literally threatening me with my life if everything doesn’t go fine. I mean that is how it goes and so in the evening you are in your dark suit and you are now the social host, you’re in the restaurants, you say hello to guests, the gentleman who has nothing much to do, but just walk around and say hello to people.
And you know, the elegant guy and so on, but now the wedding is going great and Mrs. Goldberg, in the meantime it is 10:00 at night and the wedding, everything went through and Mrs. Goldberg comes to you and is just crying and hugs you and thanks you and thinks that the children will be happy forever because everything is perfect. Then you make one more tour around the hotel and the pretty hostess at the café said you had a beautiful tie, that really made your day.
[0:38:29.9] JR: How long was your day?
[0:38:33.0] HS: Oh usually I was on the floor at 7:00 and sometimes in the evenings when it is not so busy when there was no major function, social functions you have to be there because that is what they expect and they will destroy you if you’re not. But in between sometimes I’ve been up to my wife, we have a little dinner together in our apartment and then I went down again if there was a social function. So they see you but you know, here is the big thing.
What you have to understand, as a business-person, after a day like that, and that is a Stephen Covey saying, “I did a lot of urgent things but I didn’t do anything to improve the company for the future.” That’s a big issue that we all have to understand, and I touch on somewhat in the book. In the meantime, because what you have to do when you have the teams that understand the mistakes that happen, have teams to work on finding the root cause of what happens and eliminate the root causes.
So, the mistake will never happen then you have improved your hotel and so on. That is a total additional part of the day and the life of a general manager. It is very intense and of course you have to be outside too. You have to be involved outside in the business-man’s association and then the chamber of commerce and the convention of business bureau, all that involvement, believe me, they are intense.
[0:39:59.3] JR: Oh, I am sure. I’m sure it is an intense job, but it is also probably exhilarating so that’s fascinating. So, I want to wrap up with a couple of real rapid fire questions that I am always curious to ask people that I sit down and have a conversation with you. First and foremost, other than the Bible, what one book has most influenced you?
[0:40:18.9] HS: You know I can’t give you one.
[0:40:22.0] JR: See, I can’t answer this question either, it is very unfair to ask you.
[0:40:24.5] HS: No, there are many that influenced me.
[0:40:26.4] JR: Give me a few.
[0:40:27.2] HS: I mentioned Stephen Covey’s book and Peter Trancan, everything that Peter Trancan, did and at the same time several of Tim Keller’s writings I happen to like but at the same time the philosophers, starting from Aristotle to Plato all the way to Nietzche, if you will has a lot of meaning to me and a lot of impact and of course it is very difficult to name one book and name one author.
[0:40:50.3] JR: Yeah, I hear you, so Keller is my all-time favorite. My listeners know that. I am curious which Keller titles in particular stick out to you?
[0:40:57.9] HS: Name it, you know? But I never forget reading his book on marriage, what was it? When he says – I mean listen that’s Keller. His intellectual analysis of everything and his fun statements and then when you move in and get married and suddenly you live with a totally incompatible stranger. Now come on, who can make it clearer? Something more important than marriage.
[0:41:22.3] JR: So, this podcast is all about people who are high performing professionals talking about their work and also talking about their faith and how their faith impacts their work. What one person, what one follower of Jesus Christ would you most like to hear talk about some of these topics on this podcast?
[0:41:40.0] HS: Two, Paul and Martin Luther.
[0:41:43.6] JR: And Martin Luther, okay those are going to be tough to pull off.
[0:41:46.4] HS: Get him here.
[0:41:48.4] JR: Get him here. I will tell you what, when we’re in glory forever, we’ll sit down and we’ll have a conversation with how these guys thought about their work.
[0:41:54.2] HS: You know, of course a good friend, Dan Cathy.
[0:41:56.7] JR: Yeah, we need to get Dan on here for sure. Dan Cathy is CEO of Chick-fil-A who I have written about – in Atlanta. All right Horst, the last question for you, what one piece of advice would you give to somebody who like you is pursuing mastery of this art of leadership?
[0:42:12.7] HS: Well again, I always emphasize this. Have a vision, don’t make in a pipe dream, make it a vision, think about it, dream about it, look at it, care for it. Where or who do you want to be in 10 years? I am working with a bank right now in Texas. They established a vision. They are a small bank, immaterial in the scheme of things in the United States. I work with them and they finally said, “Yes, our dream would be to be the leading financial institution in the United States. That is our vision 10 years from now.”
And I said “Let’s go. Let’s go.” Now, you have purpose, you’ve given you employee’s purpose and you see things grow with that and the journey will be exciting. You may not quite make it there, but I am telling you, you’ll get further than you would have been without a vision. Don’t work without vision, work with purpose. But ask yourself, “Would Jesus approve of it? Would He applaud you?” I believe he will, as long as you make sure your purpose is good for everybody including yourself.
But good for everybody that is possibly connected with that purpose and with your business then go and let yourself be guided by it.
[0:43:23.7] JR: That is well said, and you know Horst, I just can’t thank you enough for your words in this conversation and just your commitment to the ministry of excellence, right? This commitment to doing everything that we do as exceptionally as we can, whatever our work is, not primarily for our own fame and fortune or for the glory of God and the good of others. For those of you who are listening, the book is, Excellence Wins.
I cannot recommend it highly enough, like I said I read it in two days. I highlighted most of the book by Horst Schulze. I cannot recommend it highly enough. Go pick it up wherever books are sold. Horst thank you so much for sitting down and having this conversation, I appreciate it.
[0:44:00.5] HS: Well, I’ll tell you I really enjoyed it and chatting with you, was fun.
[END OF INTERVIEW]
[0:44:06.5] JR: What a great conversation. I hope you guys enjoyed that episode as much as I enjoyed recording it and talking to Horst. Hey, if you are enjoying the podcast make sure you subscribe to The Call to Mastery, so you never miss an episode as we start to release these week-to-week. If you are already subscribed do me a huge favor, take 30 seconds and review the podcast on iTunes. It’s the number one thing that you can do to ensure that more people find this show and find this content.
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