Ritz Carlton Founder Horst Schulze | PBD #735

Summary

PBD Podcast #735 — Ritz Carlton Founder Horst Schulze

Air Date: February 10, 2026
Podcast Host: Patrick Bet-David (PBD)
Guest: Horst Schulze, Founder of Ritz Carlton

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Episode Overview

This episode features a masterclass on leadership, service, and building world-class organizations with Horst Schulze, the legendary co-founder and former president of Ritz Carlton. Schulze shares insights from his extraordinary life: from his upbringing in Nazi Germany, to his rise in the hospitality sector, to revolutionizing luxury hotels globally. The conversation blends personal history, business philosophy, practical leadership advice, and candid reflections about the industry post-Ritz Carlton.

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Key Themes & Discussion Points

1. Horst Schulze’s Early Life and Influences

• Childhood in Nazi Germany
  • Born 1939 in a small German village, Schulze grew up amid war, deprivation, and ideological conflict.
  • His father joined the Nazi party for job-related reasons; his mother was firmly anti-Nazi.
  • “My grandfather was a unique character. Said, if our son died, he will die too.” (00:00)
  • Memories of trauma, family reunification post-war, and the impact of environment on his drive and values.
• Mother’s Influence
  • Schulze credits his mother’s relentless optimism and deep love for shaping his attitude.
  • “There was not a day where I wasn’t told ten times that she loves me.” (17:10)

2. The Path to Hospitality and Philosophy of Excellence

• First Steps in Hospitality
  • At 14, left home to apprentice in a high-end hotel, living far from family, pushed by an inarticulate urge to join the hotel trade.
  • Mentored by a headwaiter whose words shaped his life:
    • “Don’t come to work tomorrow. Come here to create excellence.” (19:46)
    • Core lesson: One’s intent should be purpose and excellence, not mere function.
  • Early realization: “Even if I was a dishwasher all my life, I don’t have to be a bum. I can define myself as a first-class gentleman.” (29:22)
• Building Self-Worth in Service
  • Service is a noble calling when purpose and respect underscore every action.
  • “The greatest gift a company can give you is purpose. Purpose and belonging.” (42:41)

3. Career Trajectory: Europe to the U.S.

• Working Across Europe
  • Schulze worked at top-tier hotels across Switzerland, France, UK—absorbing global standards of luxury and etiquette.
  • Served celebrities, politicians, and learned the realities of class and attention in high society.
  • “The pattern was that we who served them didn’t really exist.” (25:49)
• Transition to America
  • Came to the U.S. at 23 after being offered a position by a guest; navigated cultural shocks including less formal service standards.
  • “No fish knives, no fish fork. I came to a conclusion—I’m working for barbarians.” (32:53)

4. Leadership Lessons and the Ritz Carlton Ethos

• Transforming Organizations
  • At Hilton, learned about systems and managerial processes; at Hyatt, expanded leadership skills.
  • Refused early promotion to general manager at Hyatt to deliberately fill knowledge gaps.
  • “You cannot be the best general manager unless you have been rooms manager.” (37:57)
• Founding Ritz Carlton
  • Opportunity arose to create a new brand with operational freedom. Schulze’s vision: blend American relaxed service with European elegance and obsessive customer focus.
  • Rigorous standards of selection, orientation, behavior, and continuous improvement.
  • Emphasized offering purpose to both customers and staff.
• Service above all:
  • “If you care for me, I’ll deal with you, even if I could buy the same product next door for less.” (47:08)
  • Service and product trump price in luxury hospitality.

5. Instilling and Sustaining Excellence

• Employee Retention and Selection
  • Dropped employee turnover from 50% to ~20% by offering purpose and careful selection.
  • “Behavior cannot be taught after somebody is 16 years old—unless there’s a significant emotional event.” (59:21)
  • Orientations focused on inspiring purpose—“not chairs!”—to each team member.
• Empowerment
  • Employees were empowered to spend up to $2,000 to fix guest problems—economic rationale, also to prevent brand damage and create ambassadors.
  • “A customer that leaves unhappy becomes a terrorist against your company.” (71:04)
• Measurement & Feedback
  • Schulze’s focus: customer satisfaction, employee satisfaction, economics, future business indicators.
  • Most important employee survey question: “Would you recommend your mother to work for our company?” (85:11)

6. Leadership, Purpose, and Management

• Difference between Managers and Leaders
  • Did a personal study: Out of 65 managers, only 5 were genuine leaders (others were just managers).
  • TOP LEADER TRAITS:
    1. Relentless, open communication with employees
    2. Process management (involving staff, root-cause solutions)
    3. Creating belonging and purpose
• Memorable Quote:
  • “Promise me you won’t become a chair. Because if you just go to work for the function that you fulfill, you’re a chair, you’re fulfilling a function. You have to have a high intent.” (95:50)

7. Legacy, Change, and Loss of Standards

• After Schulze Left Ritz:
  • Standards slipped; policies that were most beloved by guests were cut for cost reasons.
  • “The most complimented point by customers was eliminated…After 20 years, I’m still hurt and in pain about it.” (98:53 - 112:57)
  • When founder-driven culture leaves, excellence is difficult to sustain; leadership vision is the driving force.
• Pain of Letting Go:
  • “If you have value in what you did, if it was a purpose, you cannot help but get hurt.” (110:44)
  • Maintaining purpose and culture post-founder is an immense challenge.

8. Broader Reflections: Values, Country, and Family

• Moral Foundations and National Decline
  • Schulze laments a loss of common values and civil discourse in America.
  • “We had Judeo-Christian values. Now we have 350 million different values…If we would still have Judeo-Christian values, we wouldn’t accept [socialism/etc.] in the first place.” (139:04)
• Socialism vs. Purpose
  • A passionate argument about the dangers of ideological emptiness and the need for individual, high-purpose thinking.
• On Family & Marriage
  • Married 47 years; raising four daughters, setting objectives in family as in business.
  • “What is your high intent? When I got married, my intent was: I will be in love for the rest of my life.” (121:15)
  • Communication, humility, and learning from a younger spouse.
    • “Why do you scream? Why don’t we talk about it? Maybe you’re right.” (123:42)

9. Service, Hospitality, and The Human Touch

• Hospitality Is Human
  • AI and automation make large hotels increasingly commoditized; smaller hotels may lead on hospitality.
  • “Hospitality cannot be replaced by AI. I would still have someone at the front door saying, ‘Welcome, you are respected here.’” (55:01)
• First Contact Matters
  • Citing JD Power: in 400,000 guest comment cards, when the first contact was excellent, never did a complaint follow.
    • “100% when the first contact was excellent, never did a complaint follow.” (131:54)

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Notable Quotes & Memorable Moments

• The Maitre D’s life lesson:
  “Don’t come to work, come here to create excellence.” (19:49)
• Purpose over function:
  “The chairs on which you sit are fulfilling a function. You are a human being. You don’t fulfill a function without purpose. I find it even immoral that we as companies hire people to fulfill a function rather than to join us in our vision and our purpose.” (20:20)
• On leading millennials and change:
  “Everybody complains about the millennials—come on, learn how to handle them and do it.” (100:34)
• On compromise:
  “I have no moral right to compromise. I know my objective is good for all concerned.” (101:56)
• On leadership legacy:
  “As a leader, the philosophy comes from you. People copy you all the way down. If you do something negative, they think you want that, and that’s it—all standards are gone.” (118:28)
• On humility in leadership:
  “As a leader, you offer belonging and purpose. Don’t make them chairs.” (94:49)
• On marriage and family:
  “Marriage—the only God ordained union, the greatest union there is. Why wouldn’t you work like crazy on it?” (124:05)

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Key Timestamps

• Upbringing and WWII family stories: 00:00–15:32
• Choosing hospitality and mentorship: 16:00–21:12
• Early career and European hospitality: 22:14–25:31
• Coming to America / cultural shocks: 33:08–36:45
• Founding and building Ritz Carlton: 36:45–44:04
• Difference between managers and leaders: 91:29–92:34
• How standards changed after Schulze left Ritz: 98:53–100:27
• The pain of lost legacy: 110:44–112:57
• AI, hospitality, and the future: 55:01–57:42
• Marriage and personal values: 121:15–124:05

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Takeaways for Listeners

• Purpose and belonging are the roots of extraordinary culture and service.
• Leadership is not managerial skills—it’s vision, relentless pursuit of excellence, and care.
• Sustaining standards and culture post-founder is intensely difficult; relentless communication and clarity of purpose are essential.
• True luxury is defined by human connection, not things.
• Businesses and families thrive through intent, humility, and the daily choice to work for excellence.

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For more insights from Horst Schulze, read his book Excellence Wins. The episode delivers invaluable lessons for leaders, entrepreneurs, and anyone who aspires to build organizations—and lives—of lasting impact.

Transcript

[Horst Schulze]

I came to a conclusion. I'm working for barbarians. No fish knives, no fish fork. And they live in a situation where human beings shouldn't live. My father joined the Nazi party because he had always worked. And my grandfather was a unique character. Said, if our son died, he will die too.

[Patrick Bet-David]

So living in that environment impacts your life in a big way as a kid, no doubt. I will never go to that Ritz Carlton in Fort Lauderdale ever again.

[Horst Schulze]

You understand? I cannot compromise that, you understand? I'm getting upset.

[Patrick Bet-David]

I said, there is no way. This is horse's standard.

[Horst Schulze]

And Daniel said, and don't come to work tomorrow. Come here to create excellence. Now, I didn't get that you were.

[Patrick Bet-David]

Number one when you guys left. Oh, sure, they dropped from one to 26. And Capella's number one.

[Horst Schulze]

Yeah, I insisted. Wherever we are, we are number one, period. And. And I dealt with the general manager. Will you accept that?

[Patrick Bet-David]

What's your superpower?

[Horst Schulze]

Relentless.

[Patrick Bet-David]

Here's a promise I'll make you. By the time you're done watching this interview with the founder of Ritz Carlton, your life will change. I'm telling you right now, it's a big promise. And I don't normally open up an interview saying this. This was one of my favorite interviews I've ever done in my life with an 87 year old man that was born in Nazi Germany. In 39. His father was in the military, his father was a Nazi, his mother hated the Nazis. And all he talked about was love and respect and how this boy from this city in Germany grows up, goes into the hospitality business, eventually starts Ritz Carlton later on. The only business ever to get two awards from the government for the best service in the world. That what came with that honor was the fact that you had to let any company come to your company to learn customer service. And guess one of the guys that showed up, Steve Jobs, showed up and said, how can we make Apple's customer service better? In the early 90s, the meetings he had, the people he served over the years, the philosophies. Yeah. I asked him a question. I said, tell me about the managers you manage. He said, I had 65 managers. I said, of the 65 managers, how many were leaders? How many were managers? Five leaders. Five. 60 were managers. I said, give me the best one that you had. What did they do? He gave three principles of what this guy did. Breaking it down. Here's what made this guy better executive, here's what made him a better leader. How do you deal with confrontation? How do you deal with issues, the answer is going to shock you. And for us, we've had Ritz come here and train us in this exact room with all of our executives. And then I shared an experience we had with a local Ritz Carlton in Fort Lauderdale. And I asked him, I said, so how has Ritz customer service been since you left? I think in early 2000, 2002. And his answer, he did not want to give the answer, but eventually gave the answer, and it was a shocking answer of what happens after the founder of Ritz left and what happened to their customer service at the time, they were number one. And then what he did later on with the company called Capella. And then while we're sitting here, he's talking about an email he got from a previous friend, employee that went to Ritz Carlton. He was in pain. He got emotional, talking about the fact that those standards are no longer there at Ritz. Again, I can go on and on. Married to his wife for, I think, almost 50 years, 47 years, raised four kids, broke down principles, values on personal life, all of that. I can go on with a ton of stories, but I'll wrap it up with this one quote that he said from early, one of his mentors, which you have to see when he tells the story to you. Please promise me you won't be a chair. Please promise me you won't be a chair. The amount of money he's made, he's met people from Onassis back in the days. Remember, this man's been around for 87 years to many of the recent presidents, all the presidents that we've had. And at 17 and a half years old, his first manager told him, promise me you won't be a chair. Meaning one day, when he becomes successful, you won't be somebody that just sits out there telling people what to do. And he kept that promise. Your life is about to change by the time you're done watching this interview with the one and only founder of Ritz, Horst Schultze. Enjoy this interview.

[Horst Schulze]

Did you ever think you were made again? I know this life for me. Adam, what's your point?

[Patrick Bet-David]

The future looks bright. My handshake is better than anything I ever saw. It's right here. You are a one of one.

[Horst Schulze]

My son's right about. I don't think I've ever said this. Decision. That's a simple decision to make.

[Patrick Bet-David]

I agree with you. And by the way, Horse, you need to know this. Like, I've been following your work for many years. We read the book, we see the work that you've done over the years. We brought In October of 2024, a Ritz trainer to teach on standards of excellence in this room. We took all our executive, all our managers for a full day. She did a great job on the training on what you guys stand for, questions to ask. And, you know, I've been a customer of yours for decades, going to Ritz Carlton all over the world and to sit with the guy that came up with the ideas to talk to you. It's a pleasure. It's great having you on the podcast.

[Horst Schulze]

Thank you. Great to be with you.

[Patrick Bet-David]

Yes.

[Horst Schulze]

And in turn, I admire what you're doing.

[Patrick Bet-David]

Well, thank you.

[Horst Schulze]

Truly do.

[Patrick Bet-David]

Thank you. Thank you. So let's get right into it. I'm looking at, as I'm going through the story, I'm like, wait a minute. He was born in 1939 in Stuttgart, Germany.

[Horst Schulze]

Wasn't Stuttgart, but was Stuttgart in the.

[Patrick Bet-David]

Wine area, you know, where apparently it's right next to the Luxembourg in France on that area where it's a perfect market to create wine. So to go from there to where you are today, I want to first go into the story how everything got started when you were born. What was Germany going through?

[Horst Schulze]

Start of the war. Beginning of the war. 39, in fact, my father was drafted late 39 and came back in between, but left permanently, if you will, in 41. I got to know him. I got to meet him the next time when I was seven.

[Patrick Bet-David]

So you. You. Don't you meet your father for first time at 7 years old?

[Horst Schulze]

Consciously met him. I mean, I get that. Yeah, yeah. No, in fact. In fact, I was playing with another kid in the mud heap somewhere when in the village. I live in a village. And somebody came running. Go home. Your dad came home.

[Patrick Bet-David]

Go home. Your dad came home.

[Horst Schulze]

So I ran down the street. Go home. Was a couple hundred yards run there. And there was a bunches of people assembled already, every. Every neighbor, everybody in town. That was the news when the guy came back from prison camp, you know, and it was. And he just came back and I went through the master. I knew it was him. This is a guy with a tattered uniform and everybody else wasn't. So I got in and I looked at him and I said that. And then he knew who I was.

[Patrick Bet-David]

What was that reaction?

[Horst Schulze]

Oh, well, shock and moment and then people crying and so on. That is what you remember. That the extremes you remember in the moment.

[Patrick Bet-David]

Do you remember that day till today?

[Horst Schulze]

Oh, yeah, sure. Yeah, yeah, yeah. It's pretty wild. No kidding.

[Patrick Bet-David]

Yeah, I mean, I was born in Iran in 78. So when the revolution happened and we left in 89. So living in that environment impacts your.

[Horst Schulze]

Life in a big way as a kid, no doubt.

[Patrick Bet-David]

What did it do to you?

[Horst Schulze]

Well, it. I don't exactly understand because I was there and with 11 years old, and somehow that must have all have an impact. With 11 years, I went to my parents and said, I want to go to work. I want to work in a Hotel.

[Patrick Bet-David]

At 11 years old?

[Horst Schulze]

Yeah. And I'd never. There was no hotel in the village. Never been in the hotel, had never been in the restaurant.

[Patrick Bet-David]

So how do you know this? Are you watching a movie? Are you reading books?

[Horst Schulze]

Everybody is wondering, I must have read something. Exactly. My mother never forgave me because. Never forgave herself because she then inquired, how we going to do that? When I kept on begging and begging and crying. And so somebody said, well, he should start in a very good hotel. So they look, what's the best hotel? Unfortunately, it was over 100 kilometers away. So at 14, I actually left, lived in a dorm room in that hotel. And all that was an impact of the environment where that came from. And then we sat down often with my parents and tried to analyze it. There was no real answer.

[Patrick Bet-David]

No movie, no book, no person. I know what I'm trying to find out about. How do you. Because I read somewhere as well that you said as early as four years old you knew you wanted to be in the hotel business.

[Horst Schulze]

No, no, I was 11.

[Patrick Bet-David]

11 years old. Okay. Yeah. So when I read this, Rob, where was it we read that said as early as 4 years old? I said 4 years old for him to know at 4 years old, how does that happen?

[Horst Schulze]

No, no.

[Patrick Bet-David]

What was it like? Maybe you know, because today when we read about it, 39. Germany goes to war in September. I think you're born April 25th, so five months.

[Horst Schulze]

January 10th.

[Patrick Bet-David]

January 10th. Okay, so you're born January 10th.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Okay, so January online says April 25th, by the way. And I know you're pretty private with your, with your.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

So January 10th, you're born. Few months later, the country goes to war. What is the conditions like where you're living? I know of course you don't remember.

[Horst Schulze]

That at that age, but yes, yes you do. Because there was such extremes. Pretty soon we went to sleep in the cellar. We broke the cellar wall in so in case the house would collapse, we could go into the next neighborhood and so on, so on. They were all connected. My mother, my father joined the Nazi party because he was working. My mother was a major negative. And let me give you a story that is hard to believe. My father, we didn't hear from him. My parents didn't hear from him. But my grandfather, who was hated Nazis every morning came to my house. He lived in a different house at 7am took the axe that was there from the wood shopping plat and stayed behind the door and looked through the slot in the door, old wooden door. Because the chief Nazi went to work that morning. When he went to work, he told stopped in the families where the sun had fallen and informed them. And my grandfather was a unique character. Said if our son died, he will die too. When he comes in here to report, he's going to die. So you think you don't know that as a kid? Opa is coming to take the axe. That was a normal daily routine. So you. You can't help but remember those things, you know. So when there was the message that Hitler had been killed, for a moment in the radio. My mother was in a grocery store buying crochet when it came. The Fuhrer has been killed. For a moment that was out. And of course that changed. And a few minutes later, and my mother said, God said dunk. Thank God, it's time. She was arrested the next day.

[Patrick Bet-David]

Stop it.

[Horst Schulze]

Just for a day. Because her uncle was a Nazi. So that's what. My God, that's what life was. There was nothing but what was there at the same time. Everything was still. Continue. Still had something to eat. There still was kindergarten. Even though when you had to walk into kindergarten, you had to creed to Hitler at the painting of Hitler. But it was all functioning somewhat. It's right after the war, when nothing was functioning anymore. There was a total breakdown because there was no control, There was nothing there. The interesting thing at the time, the Allies decided nobody who was a Nazi could work in a leadership role. Well, everybody who was in leadership role. If you were running a water fund, you had to be a Nazi. You had to be a Nazi, otherwise you killed. So who do you put into this roles now? It was Patton, in fact, who said, no, we are not going to do that. We have to put the people back to understand the job. I mean, that's how there was a total breakdown. There was no school, there was no transportation. There was nothing after the war. Right after the war. So that was. And of course those created such extreme moments that you do remember, no doubt.

[Patrick Bet-David]

Yeah, you see the inflation. There was some reports. I saw that the price of bread could double every Two hours, every four hours. Some weird stories that you would read about. So do you remember the day it was announced that Hitler died?

[Horst Schulze]

No, I don't remember. No. I only knew my mother was in.

[Patrick Bet-David]

Trouble, that she got arrested.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

And this was even the right one. This is the day that she thought he died.

[Horst Schulze]

That he didn't die, for the moment, was announced. Stauffenberg, who tried to kill him, thought he was dead. He announced and was open. That's how everybody was exposed, because they got a message he died. Consequently, everybody that was part of the plot. 20,000 exposed himself, took over in various towns and were killed afterwards. That's how they knew they were all involved. That huge plot. Yeah.

[Patrick Bet-David]

20,000.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

How do you. Because when I'm seeing you speak or I watch your interviews, or I sit down with you right now, or you're coming up to me, read this book, I'm going to help you change your life. You're a very positive figure, right? Your intensity, your energy. You've been married for many years. You're a man of faith. You know, you speak in a very eloquent way. Even at that moment. Were you staying positive? Was it your mom that helped you be positive?

[Horst Schulze]

My mom. My mom.

[Patrick Bet-David]

How would your mom make you positive?

[Horst Schulze]

Very positive about life, about everything.

[Patrick Bet-David]

In Germany at that time.

[Horst Schulze]

In Germany at the time.

[Patrick Bet-David]

Good for her.

[Horst Schulze]

For example, also my dad, whom we didn't hear from for over a year because his group was behind the line and behind the lines in Russia. So you didn't hear anything for about over a year. And we didn't know if he was alive or dead. He was alive in our house. My mother said, oh, that's a good job. I would tell dad or, don't do that. Your dad won't like that. So he was constantly alive there, and she kept him in the house, and it was nearly like he was there, you know? So that was. And it's interesting. That's. That's how mothers are. That's a mother. I mean, I told you when I finally. She took me to this job, which was far away from home, she knew I was very homesick, but I wanted to be there and. But she wrote me a letter every day. If I didn't have one today, I had two tomorrow. Help me through.

[Patrick Bet-David]

What an amazing mother. What a great story.

[Horst Schulze]

It speaks about mothers, you know.

[Patrick Bet-David]

Unbelievable.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

So she was the reason why you became positive. So you. So you leave at 14. By the way, how many kids were you guys? How big was the family?

[Horst Schulze]

I had a brother that was eight years older. He had left already.

[Patrick Bet-David]

So he was in the military?

[Horst Schulze]

No, no, he was. He was. He was studying and working.

[Patrick Bet-David]

He started studying and working. So you were by yourself living with mom before you left at 14 years old?

[Horst Schulze]

Yes, that's correct. Yeah.

[Patrick Bet-David]

Okay.

[Horst Schulze]

But my father was there in the meantime when I was 14. He came back when I was seven.

[Patrick Bet-David]

So from seven to 14, your father was there. What influence did your father have on you?

[Horst Schulze]

Well, very, very high demand person. Work hard, do everything right, everything with values. I. I read the Bornhofer book where Metaxas says, tells about Bornhovens, which was a very rich family sitting around a table, and the attitude was, don't talk unless you have something important to say. This was true in a very rich family. That was also true in a very poor family. In our house, sit down, eat, do everything right.

[Patrick Bet-David]

Wow.

[Horst Schulze]

Lots. Don't do it unless it's sunrise.

[Patrick Bet-David]

Is that a German thing or is that a Schultze thing?

[Horst Schulze]

Believe me, it was in a house. How German it is, I don't know.

[Patrick Bet-David]

Got it. Yeah. Bonhoeffer is an amazing story. My pastor, Dudley Rutherford, bought me a book 20 years ago, 18 years ago, to read on Bonhoeffer. Incredible story on what he went through. But going back to it, so dad was order, structure, system. Mom was attitude, positivity. Everything's gonna work itself.

[Horst Schulze]

Love.

[Patrick Bet-David]

Love from Mom.

[Horst Schulze]

Oh, totally.

[Patrick Bet-David]

How did she show it?

[Horst Schulze]

By telling, by hugging, by holding, by. By. By saying. By saying I love you. There was. I don't think I was. There was a day where I wasn't told 10 times that she loves me. I mean, that. And. And that, of course, plays a role too. I can see that. That's how I am today with my wife or with my children, you know, same way. Oh, yeah, very much so.

[Patrick Bet-David]

Are you more like your dad or your mom?

[Horst Schulze]

My mom.

[Patrick Bet-David]

More like your mom.

[Horst Schulze]

My mom. Yeah. But. But in my intensity of doing things, I'm. I'm a dad.

[Patrick Bet-David]

You're your dad?

[Horst Schulze]

Yeah.

[Patrick Bet-David]

At 14, when you left to go to the apprentice apprenticeship. And how long are you away? Are you coming back home? Are you seeing the family? What is that process?

[Horst Schulze]

Every three, four months.

[Patrick Bet-David]

Every three or four months you're seeing them?

[Horst Schulze]

Yeah. Yeah.

[Patrick Bet-David]

And this place you went to, where was it? What did they teach you?

[Horst Schulze]

Oh, well, it was. My mother took me there, and the first thing I meet is the general manager of the hotel. In Germany, the general manager was a God. Understand? And he told me, he spoke to us for two minutes, and the only message Was now you are here to study and learn how to become servants to very important ladies and gentlemen, our guests. That's what I wanted. That's why I wanted. That was my dream, to live in a beautiful surrounding and serve wonderful people, known people. But the next person was the head waiter of the hotel, the maitre d, the head waiter, whom I actually would work for. And he changed my life in two sentences, totally. Now, mind you, I was 14. I didn't know it in the moment, but he lifts those two sentences and it was overwhelming. When you're 14, you're being formed still. And he said at the time, the first thing he said, now, young man, tomorrow show up at 7am If I meant one minute after seven, I would tell you. So now it translated in after, I could see, when we say something, we do it correctly and we mean it. And we do everything right here. And Daniel said, and don't come to work tomorrow. Come here to create excellence. Now, I didn't get that. That went right over my head. I said, wait a minute. Do I have to do something else than I thought? I thought I would have to wash dishes, clean floors, and so on. Yes, I did, but we.

[Patrick Bet-David]

That comes with it.

[Horst Schulze]

Got it.

[Patrick Bet-David]

So what was the sentence? Come here to work with excellence.

[Horst Schulze]

Come here, don't come to work. Come here to create excellence.

[Patrick Bet-David]

To create excellence. And how long did he stay as your mentor? How many years?

[Horst Schulze]

Three and a half years.

[Patrick Bet-David]

Three and a half years. He worked under it.

[Horst Schulze]

Yeah. And he. And he formed my life and everyone. When he said create excellence, he meant, don't come here to fulfill a function. Come here for a high intent, your function. And I'm zealous about that. Today I wouldn't hire people to fulfill a function. I hire them for purpose, for high intent. He, for example, he made it very clear, our function may be to bring and serve food and beverage. Our intent is to instill well being in people. So that for my life, I don't do anything without purpose. And I think you're not. In fact, I make it very, very clear. And I use the same phrase that he did. The chairs on which you sit are fulfilling a function. You are a human being. You don't fulfill a function without purpose. And I find it even immoral that we as companies hire people to fulfill a function rather than to join us in our vision and our purpose.

[Patrick Bet-David]

On a vision, a mission, a purpose, something bigger than us.

[Horst Schulze]

Purpose. That's right.

[Patrick Bet-David]

So you. You picked that up from him. Did you spend a lot of time with that General manager or not that much. You were more spending time. The general manager was the guy.

[Horst Schulze]

Once in a while, he passed by and said, good morning.

[Patrick Bet-David]

How serious was he? Was he a. Was. Was that a very common thing in Germany? Super serious, super disciplined. Were those the qualities?

[Horst Schulze]

Absolutely.

[Patrick Bet-David]

I lived in Germany for a year and a half.

[Horst Schulze]

Absolutely.

[Patrick Bet-David]

In Erlangen. I was an Erlangen right outside of Nberg.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

And it was in 1989-1990. And I went to school for two years. You know, it was a very, you know, military like, you know, it was a very, you know, be ready for it.

[Horst Schulze]

Sure.

[Patrick Bet-David]

It was a different intensity you got from them.

[Horst Schulze]

Absolutely. Yeah.

[Patrick Bet-David]

Even right now, where our son plays soccer and we have an option to sending two different places to Germany or to Spain, all the coaches are sending. Germany is more disciplined. Spain, he'll learn the game, but have fun. But Germany is very much. You better get your act together. Yes. So what happens after that? So what happens? You're there for three and a half years. What do you do next?

[Horst Schulze]

And next. It was pretty common and also recommended again from that headwinder to work seasons in various great hotels in Europe. So I went out and worked in Bern in the Bellevue palace, one of the great hotels of the world. In Lausanne, in the Boerwas Palace. I worked Holland America Line for. For eight months. Worked in Paris. I stayed there two and a half years in the Plaza, at which was one of the great hotels in the world. Worked, worked in the Savoy in London. And in the Savoy, as I worked as a waiter, a guest said, you're great waiter. Do you want to come to America? And I said, sure. Now, if he would have said Zimbabwe, I would have said sure, too.

[Patrick Bet-David]

You just wanted to leave? I want an opportunity. Yeah. How old are you at that?

[Horst Schulze]

Capture the world. And at that time, I was 20. 23.

[Patrick Bet-David]

23. Okay.

[Horst Schulze]

Capture the world.

[Patrick Bet-David]

Sure.

[Horst Schulze]

Be and see the world. Capture the world. Learn. Learn new things. So he said, all right, give me your name. I will send you papers. We are opening a new hotel in Houston. Once you get the paperbacks, go to the. To the embassy. And that's what I did. And in the embassy. So they at that time, immigrant. At that time, me, I went through a physical, careful physical. I went to an oral test. I went to a written test. Yes. And in the evening they gave me.

[Patrick Bet-David]

Get a job.

[Horst Schulze]

Yes. And the evening they gave me some papers and asked me, when will you go to America? And I said, when I get my papers. And they said, you have them in your hand. This is. And then I. Then I took the ship on which I had worked as a passenger.

[Patrick Bet-David]

Stop it.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

So you go with the ship to the States?

[Horst Schulze]

Yeah. Oh, at the time, there were no. There were no planes at the time.

[Patrick Bet-David]

Right. Makes sense.

[Horst Schulze]

Basically.

[Patrick Bet-David]

Makes sense. I keep forgetting you're born in 39.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Times are different when you're born in 39. You know, it's a. It's a very different world. When was the first time. I remember you said when you first started working at the hotel, you're like, I wanted to work in luxury. I'm going to meet people. I'm going to meet these interesting people, powerful people. Who was the first person you met that was a celebrity that you recognized saying, oh my God.

[Horst Schulze]

A very famous sepan who was a very famous soccer player before that. Yeah, that was more important than. Oh, I met all the politicians of the time, if that was Aden Hour Orson. So at the time, everybody was there. That was the hotel where you were was Napan. And the general manager was. Right. The guest sitting there, all of them very important. That was the place to be. And it was at the same time a spa hotel and so on. So when I met sepan, that was. Meeting a great famous soccer player was more important than meeting all the others.

[Patrick Bet-David]

Of course. Politicians, the leaders.

[Horst Schulze]

Sure. Later, for example, I worked in late 50s, 60 in Paris in a. This. You. You name it. If it was Soraya at the time or Chris Kelly or Gary Cooper, I served them all.

[Patrick Bet-David]

Grace Kelly.

[Horst Schulze]

Grace Kelly, absolutely.

[Patrick Bet-David]

Did you ever serve onasis?

[Horst Schulze]

Oh, yeah, sure. Served them all. The bigum and so on. That those were the guest.

[Patrick Bet-David]

What did you notice? Was there a pattern? What you notice with this life of the rich and famous, what patterns did you notice?

[Horst Schulze]

The pattern was that we who served them didn't really exist.

[Patrick Bet-David]

Got it. Was that the mindset or was that the reality?

[Horst Schulze]

That was the reality. Because they were so used to. We were just there. But I was okay with me. I had no problem with that.

[Patrick Bet-David]

Interesting. Got it. Because at that time, you're not yet Horace Chulci. You're just a young man working there.

[Horst Schulze]

I just. And I wanted to. And I knew that when I was dreaming about it and that I was taking care of very important people and one or the other recognizes you. And I. I had an experience every. So when I worked the first day I worked actually in the restaurant where I started, there were a couple sitting there and they saw, of course, my beginning, that my knees were shaking and so on. And the gentleman told me Come here, you're doing a great job. And gave me what? 5 mark, which was a huge amount of tip at the time. This is what year that was? 1954.

[Patrick Bet-David]

Okay.

[Horst Schulze]

That was a huge amount of money. And so. But the encouragement of that moment is what mattered was traumatic.

[Patrick Bet-David]

Unbelievable. Just to see that somebody is encouraging you, even though you think you're nervous. Was he somebody or was he just a businessman?

[Horst Schulze]

I had no idea.

[Patrick Bet-David]

You had no idea who it was? It wasn't a famous person?

[Horst Schulze]

No, no.

[Patrick Bet-David]

Was there any famous person that was super complimentary, that left an impression on you? When you were younger, who was the kindest to you?

[Horst Schulze]

Well, probably because we're tall. So I'm not quite sure. There was Conrad Adenauer, who was a guest several times there with, always with others and of course, security around them. But he looked at you and said, good morning. He looked at you?

[Patrick Bet-David]

Got it.

[Horst Schulze]

And he didn't just pass you by, you existed. You actually felt that you existed.

[Patrick Bet-David]

Interesting.

[Horst Schulze]

And I found that very encouraging too. And so we all liked him for this very nothing that he looked at and said recognized us. But a huge change in that moment. That particular job too. Again with that Metro. D. Typical German. You learn this work once a week. You go to a school of your trade, in this case hotel school, where all the kids from the area came. And after two years there, the teacher asked us to write an essay. What we now think about our business. Going back to work. That night I was cleaning a table and I watched that maitre d approaching a very important table. But they were all important. And in that moment I realized I'd seen it before but never realized it. The guests on the table were proud that he came to them. He was a very tall man, he worked in tails, and he worked fantastic. And I thought, wait a minute, this is a reversal. Why are they. We are the servants. And I thought about that. I had to write an essay that night for that school. And I thought about it and I wrote the essay. And for the first time in my life, I came to the realization which kind of formed my life too. The reason those guests were proud that he came to them because he had defined himself as a first class gentleman. And I realized, wait a second, I can define myself. Even if I was a dishwasher all my life, I don't have to be a bum. I still can define myself as a first class gentleman.

[Patrick Bet-David]

How does one do that?

[Horst Schulze]

By respecting others, by being honorable, by not going against authority, if you will, by coming to work five minutes early and say Maybe five minutes late, later, and say, I respect what I'm doing here by saying good morning to your boss. And not ignore, not hate him, but be thankful that he exists because otherwise I wouldn't have a job. So I still can define myself and do everything I do a little better than anybody else.

[Patrick Bet-David]

As simple as it is.

[Horst Schulze]

It starts simple. Don't complain about business. It's ludicrous. When I started Ritz Carlton, I only took the job, remember? I had a great job. I had golden handcuffs. I had everything. In fact, people may heard that work with me. I was a young star in that company and hired at the time in charge of 65 hotels in the United States, food and beverage operations and so on. And I left for a dream, for a purpose. To create the finest hotel company in the world. Because they told me you can do what you want, basically operationally. And I went there for that purpose. But I had to ask myself, is that purpose good for all concerned? First of all, is it good for the owners? Because believe it or not, friends, you won't have a job without some owner. That was clear to me. Number two, is it good for every employee? It wouldn't be good for the employee. It wouldn't be good for the owner because we wouldn't have a job. Is it good for every customer? Is it good for society as a whole? And I question myself, would God approve? Once I have this, can answer that clearly as yes. I cannot compromise it anymore. And now I have to find myself as the person who can do it. That's it. It is not a matter of just having a vision. That vision has to be of value to all concerned.

[Patrick Bet-David]

That makes sense. When you got that call at 23 to go to Houston, was that Hilton or was that Hyatt?

[Horst Schulze]

It was Hotel Corporation of America, which became Sonesta later. Okay, so I went to Houston. Frankly, I didn't stay alone very short there because I was totally new. And when you have cultural beliefs that sometimes very stupid. And the first day there, first of all, I lived in Hawaii, no air condition. And I got there late June. I've never experienced heat like that in Houston. In Houston and next door I worked. And the first day I worked as a waiter. Actually, I was there a few days. First day I worked as a waiter, I had an order of fish order. And I looked, where are the fish knives and the fish forks? I had worked in the finest hotels in the world, Minu. And they said, what is that? And I came to a conclusion. I'm working for barbarians. No Fish snipes. No, fish fork cannot be. And I live. And they live in a situation where human beings shouldn't live with this heat. I thought. I didn't know that was air conditioned.

[Patrick Bet-David]

And Houston is pretty hot. If you're coming from Europe, you better believe it. Yes, my wife's from Houston. It's very hot.

[Horst Schulze]

So I called a friend of mine who worked in San Francisco in a civilian French restaurant, and I said, I'm going back. This. This is. This is the barbarians. They serve fish without. How ridiculous can you be? That shows you how silly we sometimes have beliefs, our beliefs that we set. Because the culture is. It is sometimes very silly. We have to look into it. So I left there, took the bus to San Francisco, worked in San Francisco, started in a restaurant, but then I worked back in the hotel because I wanted hotels and worked for Hilton. And after afterwards joined Hyatt.

[Patrick Bet-David]

How long were you at Hilton?

[Horst Schulze]

With Hilton, I was not long there, but then I went to the club and back to Hilton. I was with Hilton for nearly four years.

[Patrick Bet-David]

Four years?

[Horst Schulze]

Yeah.

[Patrick Bet-David]

What did you learn at Hilton that you took on with your career?

[Horst Schulze]

Well, process of manage of what you do or the organization. Because I worked for a while in catering, selling, how you organized sell and so on. So I learned. But not traditional service, because we have kind of all forgotten what is table etiquette and so on. I learned that when I was a kid. Believe me, that method, everything had to be 100% correct. But in Hilton, it was working and systems. I realized that every effort has to have a process. Started learning that. And then I joined Hyatt.

[Patrick Bet-David]

Is Hyatt where you became, where you made a name for yourself? Yeah, because. Is Hyatt where you wrote your first book or was it at Hilton?

[Horst Schulze]

No, I. No, I read that after, basically after retired, after the book was written, I became quite good friend with Stephen Covey. And Stephen was urging me to write a book about what we had accomplished with Ritz Carlton.

[Patrick Bet-David]

So this is post Hyatt? Yes, this is at Ritz when you met Stephen Covey and he said, write a book.

[Horst Schulze]

Yeah, got it.

[Patrick Bet-David]

Okay.

[Horst Schulze]

And he. He told me and I didn't do it. And he kept on telling me. And then one day I was driving home and he called me and I could answer, father is Stephen. That's how he talked you. I'm disappointed, so disappointed.

[Patrick Bet-David]

And you, he's telling you this?

[Horst Schulze]

Yeah. I said, why, Stephen, you have still not written your own people, you own it people to write your book. Promise me you will. And I promise you, a few months later, he died. And that's when he died. I was so. And he always said, I want to be the one who writes you forward. And he died. And they said, stephen, I write a book for you now.

[Patrick Bet-David]

Wow. Well, I mean, he wrote a book that sold. I don't know how many copies.

[Horst Schulze]

Changed me.

[Patrick Bet-David]

Oh, yeah.

[Horst Schulze]

Impacted me.

[Patrick Bet-David]

Yeah. Lifechanging.

[Horst Schulze]

Oh, no question.

[Patrick Bet-David]

Seven Habits. And then he wrote Eighth Habit. Right. He wrote a book called Eighth Habit.

[Horst Schulze]

Yeah. Family Habit. Yeah.

[Patrick Bet-David]

One of a kind. He was very unique. My unique. Very unique. So, okay, so walk me through. When you're at Hyatt, you're making a name for yourself. Ritz comes and recruits you, and you take your opportunities to risk what happened there first.

[Horst Schulze]

And I would like to say that because I would like to impact young people and the conversation such. When you come to my age, you want to impact.

[Patrick Bet-David]

Sure, yeah.

[Horst Schulze]

When I worked for Hyatt, I was food and beverage director. That means I was in charge of the food and beverage operation of the hotel in Chicago. Yeah. Year and a half later, I got a call from Mr. Freund, who was the president of Hyatt at the time, and said, horst, sit down. We have something wonderful for you. You have done a great job with your European flair and all those things. We have what is maybe the best hotel in the company, and you're going to be general manager. This is a moment, a dream moment, the impossible moment, the moment that you will never accomplish but dream from. And here he said, you are the general manager of the finest hotel we have. And I said, I won't take it. And he said, are you not leaving the company? I said, no, I'm not leaving the company because I want to be rooms manager first. I never was rooms manager.

[Patrick Bet-David]

Stop it.

[Horst Schulze]

Yeah. And he said, we're giving you rooms manager. And I said, yes, but I cannot be the best general manager in the company unless I have been rooms manager. Wow.

[Patrick Bet-David]

What a message.

[Horst Schulze]

And he said, I'm coming. He was in San Francisco. I'm coming to Chicago and talk to you. You're leaving the company? I said, no. He came and said, no, I want to be. He said, we have to find this hotel for you. I said, make me rooms manager. Give me the worst hotel. A year later, he called me. He met me rooms manager. A year later, he called me and said, remember what you said? Yeah, I want to be rooms manager. He said, no, no. You said, you want to have the worst hotel. We got it. And I got Pittsburgh, which was a D a real dumb.

[Patrick Bet-David]

What year is this?

[Horst Schulze]

That is 1969. In 74. Okay. So I moved to Pittsburgh, and two and a half years later, I was promoted to a larger hotel in Detroit. And a year later I was promoted to regional vice president over 10 hotels. And two years later, I was promoted to corporate vice president and to Chicago. And that wasn't good because when you're corporate vice president, you're one of a bunch of bumps. They're all vice presidents. If you're regional, you're the king in your region, you know, But. But still.

[Patrick Bet-David]

Leader of bombs.

[Horst Schulze]

Still. It was a promotion. And so I moved to Chicago at the time. And then I got that call after I was there for nearly three years.

[Patrick Bet-David]

To be.

[Horst Schulze]

To call. That is a job. We did what they said. We are building two hotels, a Holiday Inn, and. But we cannot come to agreement. We want. Somebody recommended that we create our own brand. And you were recommended to run that brand.

[Patrick Bet-David]

Who recommended you?

[Horst Schulze]

Somebody I had that had worked. And a vice president used to be. Had worked in Hyatt.

[Patrick Bet-David]

At Hyatt.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

If you would have stayed with Hyde, who would you have become?

[Horst Schulze]

Probably CEO.

[Patrick Bet-David]

You would have become the CEO of the Crown if you would have stayed with Hyatt. That was the trajectory. Everybody knew. Okay. It was obvious.

[Horst Schulze]

Yeah. Oh, yeah.

[Patrick Bet-David]

Okay. So why take this position, this opportunity that comes along?

[Horst Schulze]

Because at one word you said. When I asked him, what would you do with your hotels? And they said, operation, that would be up to you. And I started dreaming, and I saw a purpose and it started to control me. And I said to my wife, I will make this the best hotel company in the world if they let me really. Operation do what I want to do. I saw because the leaders. Individual hotels that were different, but the leaders of company leaders in hotel business was hired. Hilton International, Weston and so on. Intercontinental. And they were basically all doing the same thing. And I thought I wouldn't compete with them. I just would go over them and pull the best out of them and mix a little bit more. Do not get away from the relaxed service element of America, but put a little bit more elegance and customer attention into it. And it seemed to me when I listened to other companies, not hotel companies, there seems to be a lack of understanding that it's all about human beings. There are two groups of human beings when you're in business. The one group is your customer. The other group is your employees. So how do you and. And both groups have emotion, thoughts, wishes, yet they're not taken into account by those that run companies. I have to take in account. I have to know what is my customer's expectation from my product, what would they expect from me. And then I have to know as a good manager, I have to create processes, system and controls. So I deliver the expectation of the customer, hopefully superior to my competition. But it only can be superior if I'm also a leader, not just a manager, and lead my people to want to do that. This can only be done if my people are working for the same purpose. There's purpose. And I still believe and say that again, it's not a job. That's the biggest gift a company can give you. The biggest thing a company can give you is purpose. Purpose and belonging.

[Patrick Bet-David]

You felt you didn't have that at Hyatt?

[Horst Schulze]

I. I felt that wasn't managed well. We still just hired people and then sometimes decided that employee is not good. Wait a minute. If that employee is not good, why did I hire him? It's leadership. Either I selected the right employee or I oriented wrong, or I trained wrong, or I have the wrong work environment. So it's not the employee, it's me. And that acceptance was maybe there in some people, but it wasn't organized. And I knew if I organize my selection, my orientation, my training and my sustaining the knowledge and create the right work environment, I could beat anybody. I believed. I still believe that I. Sorry. Sorry. Anybody. Everybody thinks I'm very arrogant now. I think I could take any company in the world, make it the best company in the world.

[Patrick Bet-David]

I still believe that today.

[Horst Schulze]

Yes, absolutely.

[Patrick Bet-David]

Based on what premise?

[Horst Schulze]

Based on the premise that I would offer purpose. That I would have be very careful in selecting employees and not just hire people.

[Patrick Bet-David]

Come.

[Horst Schulze]

Come on. People are not silly. They're hired. And I would orient them to the job. I opened every single Ritz Garden hotel and every capella hotel myself. I didn't go there to drink champagne. Well, I did a little bit too. But I went there to orient the employees as to who we are and welcome them and role playing to them. How we deal with customers and train them. So I was connected today. So I made sure. But what did I train? I trained what I knew the customer wanted. Not what I want, not what I want. Come on. I have been on a board with many boards and most CEOs or nearly all. Full of egos, full of emotion, full of insecurities, like we are as human beings. But has no respect that the employees and the customer has the same thing. What does a customer really want from you? What do they really Want I spoke to Classic Hotels of America not long ago. And before me was a speaker who said, everything is new. Forget everything. Everything is technology. Technology, everything is new every 20 times. Forget all you knew. If you don't, if you're not in technology today, you are lost. I was the next speaker and I said nothing is new. Because you see, 5,000 years ago, human beings want to be respected. And this was true this morning. And mind the God tomorrow and in 5,000 years from now. And if my technology helps you, my customer, to tell you that I respect you and at the same time care for you and do my best for you, that's what it's all about. It's caring. And guess what? Their studies and American consumer study, that's not very old, where the 80% of consumers says, I deal with you if you care for me. Even if I could buy the same product next door for less. So on the end and organizations, the respect for an organization is how I care for people. And that because that creates trust. People talk about loyal customers. Well, what is a loyal customer? Loyal customer is somebody who trusts you. They're not trusting you because of the product. They're trusting you because how you treated them, that you respected them. And that is not. Seems to be not understood. People work on the product and they do their best, they work hard. But I have to work on making sure that my customer knows I respect them.

[Patrick Bet-David]

So you know, when you think about three things, Product, service, price in your eyes, in order, what would you put first? Product, service, price. Service, service. First. What's second? Product, product. And the price is less because if you can get the first two, they'll pay anything for.

[Horst Schulze]

If I get the first, I get more. Listen, A Good Housekeeping was a magazine that developed value or product. They voted us Ritz Carlton in the early years as best value. We were the most expensive, but we were the best value.

[Patrick Bet-David]

Wow.

[Horst Schulze]

You know, wow. That's the point. That's what I have. And at the best value. Look in. In our first hotel there, and I never forget it because it even shocked me. We put a chandelier up in our. As we were finishing it up in. In the. In the elevator foyer, this chandelier went up and. And I realized there's a 28, 000 chandelier hanging there. No guest ever commented on this darn chandelier. Nor did I do on the $200,000 oriental rug, nor on all the marble. We bought whole mountains in Italy. Nobody commented. But they commented how we respected them, how we treated Them how we were friendly, how we responded, that we cared.

[Patrick Bet-David]

So could you have gotten away with a $800 rug and a $600 chandelier? You think you could have gotten away with it?

[Horst Schulze]

Yeah. Yeah. Look at that.

[Patrick Bet-David]

That was last I see your capella hotel. Your capella hotels that you build, you know the.

[Horst Schulze]

It's not chandeliers. Oh yeah. It's still marble.

[Patrick Bet-David]

It's beautiful. Yeah.

[Horst Schulze]

Oh, absolutely. Oh, absolutely. But, but the key thing that we did Capella only 100 rooms. So I can individualize service. I couldn't individually service any 600 room Ritz Carlton because I had 450 check ins today, 500 checkout. But in a hundred room capella with only individual and not conventions. I can call you before you come and say we are coming to Singapore. What can I do for you? It's all about you. As long it's more legal and ethical, I'll do it. There's no check in time and check out time. We will have a room for you when you arrive. It works. We figured out how that works.

[Patrick Bet-David]

I saw you explain somewhere where you said at Ritz customer would be unhappy if check in took more than four minutes. Right. At Capella, you brought it down to 20 seconds.

[Horst Schulze]

Yes. In fact that's the change of the human being. We knew after four minutes they will get angry. Today it's 20 seconds. The timeliness. We better know that as businesses timeliness expectations have become dramatic. True respond including responses to emails or so on. And we better know that there are two things that are critically different and that is timeliness and individualization. The millennials say do it my way. There you are again. What business has ever met a study what the millennials really want. Shouldn't we if we have a business shouldn't I know what my new customers expectation is from me? And one thing expectation in millennium is do it my way. Individualize to me the difference between look, if I would go to McDonald's I would say I take a number one. The millennial says a number one but not tomato two slices of pickles. Individualization. And if I run any business, I have to understand that there is individualization is expected.

[Patrick Bet-David]

Was that not the case before or that was always.

[Horst Schulze]

Oh, much less. So much less.

[Patrick Bet-David]

Much less. So 40 years ago.

[Horst Schulze]

Much less.

[Patrick Bet-David]

Really. So you just expect that whatever you sold, I accepted as a customer.

[Horst Schulze]

That's it? Yeah.

[Patrick Bet-David]

So how do you so, so, so how do you differentiate between the speaker that came before you where he says new new, new what is ever? What principles are Evergreen and what principles are changing? What's changing that you have to adapt.

[Horst Schulze]

To debate is done changes the way it is done. And of course customers expectations will change. I tell you a funny story on customer expectation. When I opened the first Ritz carton at that time the first plastic card keys came out which today's norm. Well this was nearly unheard of. They called them wing cards at the time. And I said since this is new, we do that.

[Patrick Bet-David]

You were the first.

[Horst Schulze]

I was very early this and it was. It's a good security piece. But our guest checked in and said you're a luxury. You tell me give me a plastic piece.

[Patrick Bet-David]

Wow.

[Horst Schulze]

So six months later we changed the locks because that was this silly thing was overwhelming to customer that I would give them a plastic.

[Patrick Bet-David]

Wow. So they saw it as cheap. Not as a.

[Horst Schulze]

And, but, but wait a minute. Three months, three years later they said you give me a hard key that is very dangerous. What if I lose and they come into my room? So we change locks again. Yes, you have to go with the customer. But on the end is how I do it. It's how they feel what I'm doing. In the end I have to tell them I care for you by that action. They don't know that I care. I just responded. But by me saying friendly instead of saying hi, hey, saying good morning sir, how are you today? And tell you with my eyes I am here for you. I respect you.

[Patrick Bet-David]

Amazing. So the question now here's the question I got for you. You go from keys to card to what is this? I want a key. Back to key. Back to card.

[Horst Schulze]

Three years later back to card. Yeah.

[Patrick Bet-David]

Question for you is who do you listen to? How do you know the right move is to go back to keys and the right move is to go back to cards. Is it the complaining customer? Is it majority? Is it employees? What patterns help you make that decision?

[Horst Schulze]

You don't listen to your mother in law. That's a study of one. A complaint is also a study of one. You make customer service thoroughly ongoing. You have to understand what the market wants. It's not the individual. And that's a bad thing companies do. Particularly entrepreneur owners, the billionaire owners. His friend tells him and then he comes and change it all. Because my friend told me that's a study of one that you just don't respond to. You have to understand what the market as a whole wants.

[Patrick Bet-David]

How do you do that?

[Horst Schulze]

By making customer studies. We of course it was easy until we had a. I had a customer analysis done for I Knew every month in every hotel in the world what the customer satisfaction was, what the employee satisfaction is, what my economics are and what my future indicators are. That's the only thing I need to know. The rest are delegate. The rest are delegate. But if the customer satisfaction intent to return was not there, we then could dig in why into the very studies and we analyzed if. If there are in every hotel the same trend.

[Patrick Bet-David]

Got it.

[Horst Schulze]

So we know what is there. We then tweak constantly. You tweak your so to that you keep on serving the customer the way the customer wants to be served.

[Patrick Bet-David]

Like what. What is AI doing right now to the hotel and hospitality business that some people are using that you'll say I'll never do. And what is AI doing to the hospitality business that you love?

[Horst Schulze]

Well, I'm not there. I mean I'm generationally cannot quite accept that AI yet. Oh. But I'm saying I work with a technical group and we are leader in the technology that has created for hotels.

[Patrick Bet-David]

That's capella.

[Horst Schulze]

No, that is the hotel company. I'm working with a group KYC that puts technologies into. Into hotel. So we, so we know everything and we partially AI for instance in AI I have, I can do everything. But I. What is happening because of the AI is nearly every brand larger brand is becoming a commodity now means you check in with your iPhone pretty soon that's what you do. You check in, you call the elevator, you go into your room, you will check out and so on. That means it is a commodity that offers shelters sleep. Hospitality cannot be replaced by AI I still have to have a human being. I would still have. If I was running hotel I would do that. But I would have somebody on the front door that says welcome and walk to you to the elevator and say I'm here for you. You respect it here. And not just. But it's driven. Of course the company has to make a three month report to Wall Street. So I have those people staying in the front door. But that's the end of hospitality. But that's why small hotels do it will be the leader of excellence. Small hotels that do it.

[Patrick Bet-David]

Yeah because they're able to control more of it.

[Horst Schulze]

They will control more often and they will and they will be successful because of their hospitality and not just because of shelter.

[Patrick Bet-David]

So then scale is harder today. The bigger the company is because you can maintain customer service.

[Horst Schulze]

You, you could if you. If you're willing to spend the money for it. But, but, but large companies don't because they're. They're pushed by. By shareholders to make a little more profit.

[Patrick Bet-David]

Who's the bigger company today? Like you know, that you still look at and say wow, good for them. Big companies still maintaining customer service.

[Horst Schulze]

Oberge is pretty big becoming big, but there's still attention. Rosewood are still paying attention to the customer somewhat and. But you know, you see most big names that you know, and I will not repeat the names are becoming commodities very fast.

[Patrick Bet-David]

Do you. When you, when you sold, when you stepped away from Ritz, what year was that when you stepped away from Ritz?

[Horst Schulze]

And well, I, I have finished my work with Ritz in 2002.

[Patrick Bet-David]

2002, yeah. And you went to Ritz, what year?

[Horst Schulze]

1974.

[Patrick Bet-David]

From 74 to the end of 73.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

The lady that was here, she said something, she said, she said the Ritz went from in the mid nine in 1991 having employee turnover at around mid 50%. And then by the time it was done it was around low 20%. That's the stats that she's given 18%. Right. And.

[Horst Schulze]

And the industry was 120.

[Patrick Bet-David]

Right. I mean it's a 365, 24 7. You guys are always open. You're never closed. What did you do to lower retention, increase retention as much as you did?

[Horst Schulze]

We touched on it. We offered purpose.

[Patrick Bet-David]

Outside of that though, outside of that.

[Horst Schulze]

What else did you do in the selection? We were very careful. We were very careful. We had a selection system. Be very careful and we established standards already during the interview because, you know, people don't seem to get that most. Most. What you want, all of us from an employee is the right behavior. But behavioral analysts working with University of Colorado and University of Frankfurt on that. Behavioral analysts will tell you behavior cannot be taught after somebody is 16 years old.

[Patrick Bet-David]

Wow.

[Horst Schulze]

Yeah. How? Unless. Unless there's a significant emotional event in your life.

[Patrick Bet-David]

Makes sense.

[Horst Schulze]

And interviewing for a job is a significant emotional event. And what we do, we just ask questions rather than establishing standards. Right there. Behavioral standards. And say, Patrick, you know, we have an attitude in our hotel, in our company, we are petted about it. We are very friendly to every guest. In fact, within 10ft we look him in the eye and say friendly. Good morning. Can you do that? What will you say? You will say yes, sure.

[Patrick Bet-David]

Yes.

[Horst Schulze]

And well, wait a minute, Patrick, I'm very serious about that. You will say yes again. I just established a new behavior in you for your benefit to be successful. Timeliness is very important to us. So I will start trying to stop. But I do that and Then orientation. First day of work, which every company does wrong. Period. We didn't do that. I went to the orientation. I role played how to say hello in front of every new hood, every in every new hotel and every takeover.

[Patrick Bet-David]

I was the one teach me how do I say hello.

[Horst Schulze]

And said, okay, so you're a guest. Here's a guest coming within 10ft. 10ft is the essential moment. But within 10ft they make a decision about you. Us you make about them. Society lies about those things. You should look baloney. We're human beings. We cannot help it. We make a decision about the other person. So what decision do I want you to make about us? About me? I want you to make a positive one. That's why we wear the right uniform. That's why we groom. Right. And that's why we look them in the eye. No matter what we're doing with hand feet. It's a non negotiable. That's what we do. We look him in the eye and said, good morning, sir or Good morning, ma', am, how are you today? Now watch me. Good morning, sir. Good or Good morning, ma', am, how are you today? Welcome.

[Patrick Bet-David]

And you're role playing this with.

[Horst Schulze]

I brought that. And I role played how to talk to each other with other employees.

[Patrick Bet-David]

How do you do that?

[Horst Schulze]

Well, if I walk by. If I we working together and I walk. I want. I said first of all, do you want a good work environment?

[Patrick Bet-David]

Yes.

[Horst Schulze]

Oh, yes. So okay. Now Patrick, the people in the environment are responsible for the work environment. So I walk, I want a good work environment. I walk by you and I go say, good morning, Patrick, how are you today? And you may just. But tomorrow morning I do it again. And pretty soon you will say, good morning, horse. How are you? I'm responsible. I am responsible. My work environment. Have you heard me all? And everybody will say yes in the room. Oriented day of orientation is a very significant day. You see, we interview. I interview you. I really want you. The shop is open. But our orientation day is not for 10 days. So I'm going to say, Patrick, I'm going to put you in the payroll. But you cannot show up. You cannot. But when? If you show up, you're paid for the next 10 days. But that's the day you start working. Because I want you to have a significant emotional event when we do orientation.

[Patrick Bet-David]

Stop it.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

So you hire me.

[Horst Schulze]

Yes.

[Patrick Bet-David]

You pay me those 10 days?

[Horst Schulze]

Yes.

[Patrick Bet-David]

And even the orientation is not in 10 days.

[Horst Schulze]

That's right.

[Patrick Bet-David]

Why are you doing that?

[Horst Schulze]

Because if I let you before, without having the proper orientation. I. I didn't use the significant emotion then to teach you the right behavior.

[Patrick Bet-David]

And what is the right behavior? You're trying to teach me to pay me 10 days that I'm working on.

[Horst Schulze]

I'm repeating the things that I told you during the interviewing process. The orientation is a day when we teach you again. Here is how we behave. Here's how the guest is important. Here's how we treat each other. You are part of something. Let me put this way. How are people being oriented? I can tell you. If you worked somewhere, I can tell you how you were oriented. Everybody orients like that. If you come to work and the boss tells you the rules of the company, here's what we do, and here's what we don't do, and then you get a handbook with more rules, and then you get insurance papers and all kind of papers, and you go through all this work, and that's the day of orientation, first day of work. And when you finish with that, the boss makes his pathetic team speech. We are a team here. Yeah. Without giving purpose. A team is a group of people who work toward a common objective.

[Patrick Bet-David]

Sure.

[Horst Schulze]

Not given, just. We're a team here. And what's next? Now, Bill, the new waiter, work with Fred, he's here nine months and he knows the ropes. Somehow you're in rope business here. Now you turn him over to Fred, and on the way to the kitchen, Fred tells Bill the new way that this company is no good. That is day of orientation. Instead of the day orientation saying, here's who we are, you're now part of us. And here's how we. Who? He's our customers and we are happy when they're here. We respect them. Here's how we show them respect. By saying welcome by responding to them, by looking them in the eye, by caring for them. That's our. That's our part, Patrick. We have to give human beings purpose, but we have to at the same time tell them the motive of our purpose. What did Adam Smith say? Hey, wait a minute. Three hundred years ago, wealth of Nations. Yeah, but he wrote another book about the behavior of the human being. And he said, impossible that people can buy into orders and direction. They can only buy into objective and motive. And what we do. We give orders and direction instead of giving purpose and motive. That is the millennials say, what's in it for me? Well, tell them if we accomplish that, here's what. You will have more opportunities, you will make more money. You will be respected, will be Honored. That's what's in it for me, for you. And that's why we have this beautiful purpose and that's why we come to work. We do not come to work for the function. We are not chairs.

[Patrick Bet-David]

How do you teach? How do you teach? And she talked about it here as well that day. How do you teach employees to confront each other? What is the format of confronting management to employees, Employees to employees. How do you teach me to do it?

[Horst Schulze]

Yeah. Well, first of all, turn it around. We had in our pockets first class cards. And everybody was encouraged to use that card if they see anybody doing something good, a fellow worker, write down first class and give it to them. Or when I walked on tail, people gave me first class cards. So that's the opposite. That is right away establishing the environment that you're here to deal with your video with your fellow workers in a positive mode.

[Patrick Bet-David]

And then what happens? The more first class cards I get.

[Horst Schulze]

No, you just collected a first. I have 20 first class cards.

[Patrick Bet-David]

How do you recognize the person that got the most first class cards in a month?

[Horst Schulze]

Monthly, every department recommends an employee of the month. That employee all employee of the month have a dinner. One of them gets employee of the month total for each department, but one gets for the hotel.

[Patrick Bet-David]

Got it.

[Horst Schulze]

They're 12 in a year. That's once a month. One of those 12 becomes employee of the year. He becomes a vacation. Paid vacation with a spouse and cash.

[Patrick Bet-David]

Paid vacation for spouse with spouse. You find them a spouse or you don't find them a spouse. I don't think you're in that business. That's a different business. You don't want to say that. You'll attract people.

[Horst Schulze]

A lot of different customers tell me they make a lot of money.

[Patrick Bet-David]

Make a lot of money? Yeah. You can do like Only Ritz. If you did like something called Only Ritz, not only fans, it would be a different business model you'd be in. Success is built on how you think. Influence is built on how you show up. Every detail matters because presence speaks before you do. This is more than style. The future looks bright.

[Horst Schulze]

Close your eyes. Exhale. Feel your body relax. And let go of whatever you're carrying today. Well, I'm letting go of the worry that I wouldn't get my new contacts.

[Patrick Bet-David]

In time for this class.

[Horst Schulze]

I got them delivered free from 1, 800 contacts. Oh my gosh. They're so fast. And breathe. Oh, sorry. I almost couldn't breathe when I saw the discount they gave me on my first order. Oh, sorry.

[Patrick Bet-David]

Namaste.

[Horst Schulze]

Visit 1-800-contacts.com today to save on your first order. 1-800-contacts lifelock. How can I help?

[Patrick Bet-David]

The IRS said I filed my return, but I haven't. One in four tax paying Americans has paid the price of identity fraud.

[Horst Schulze]

What do I do? My refund though. I'm freaking out.

[Patrick Bet-David]

Don't worry, I can fix this. LifeLock fixes identity theft guaranteed and gets your money back with up to $3 million in coverage. I'm so relieved.

[Horst Schulze]

No problem. I'll be with you every step of the way.

[Patrick Bet-David]

One in four was a fraud paying American. Not anymore. Save up to 40% your first year. Visit lifelock.com podcast terms apply. So let's say in this. So you. So I get first class cards. But still, because when you're talking about this, the reality of running a company is you're not hiring everybody, right? You have direct reports who have direct reports. And you have a chief HR officer that the interviews come through. How are you teaching me to hire Ritz type of people to the company? What am I looking for? You're not doing 100% the interviews. How do you teach me?

[Horst Schulze]

Oh, well, because when you came in, you were taught and everybody understands the very minimum. Everybody goes through orientation and managers go through a special orientation. I gave every manager leadership session. The way our teaching worked beautifully because we were, mind you, we started with no hotel. So every hotel we had was. Was at a new or takeover.

[Patrick Bet-David]

Got it. So you had an added. You had an advantage.

[Horst Schulze]

I had an advantage. I opened every hotel.

[Patrick Bet-David]

I got it.

[Horst Schulze]

I also knew all employees knew me. It wasn't them.

[Patrick Bet-David]

What a point.

[Horst Schulze]

It wasn't them. In the corporate office, you have to overcome the theme. Because if I don't know you up there in my insecurity, I will blame you. What is wrong up there? Because if I don't make it, if I can't live up by the rules, it's your fault. You have. But they knew me. That's why the big thing that happened in Ritz Carlton is the empowerment piece, which was. Which was a nuclear explosion in all businesses. When I said I empower every employee to make a decision up to $2,000 if a guest has it. But I could do that. First of all, we did that very carefully. I didn't just say it. We taught. I thought about it for a very long time. It was an economic decision. I didn't want to lose a customer because a customer that leaves unhappy becomes a terrorist against your company. You cannot afford that. Really. I knew from the behavioral analyst that 96% of complaints is people that want to get rid of their frustration. We learned. I thought they complained on the front desk or the concierge. No, they don't. They complain to anybody who listens. Anybody listens. And if you don't accept it. So I had to make sure that a busboy was will accept as his tv. The TV that didn't work. Forgive me. And so I didn't want customers to run out there and be unhappy. My guess is well connected. He calls his travel agency and said it was no good. His travel agency is part of a consortium 500 travel agencies. So I want to be sure that everybody leaves as an ambassador. So I had to teach our. Our employees how to handle any complaint and say at the same time, I trust you. In fact, you can make a decision up to $2,000 to keep that customer.

[Patrick Bet-David]

How much did that end up happening per month? Like at its peak, how many people use the full $2,000 at its peak.

[Horst Schulze]

In the last three years? I was there once.

[Patrick Bet-David]

Oh, wow.

[Horst Schulze]

The rest was the bus by saying, did you have a nice day with us? No, my TV didn't work. Please forgive me about my tv. I will buy your breakfast. And I guess the complainer now is embarrassed that he complained and leaves as an ambassador rather than so. But we certified every employee how to do it.

[Patrick Bet-David]

So were you employee number one?

[Horst Schulze]

Pardon me?

[Patrick Bet-David]

Were you employee number one in Ritz?

[Horst Schulze]

Yeah, sure.

[Patrick Bet-David]

So you're the founder, president and CEO of the company, Right? Co founding member of ritz. So from one employee to 47,000 employees, you've been part of that entire process.

[Horst Schulze]

When I left at 25,000.

[Patrick Bet-David]

25,000. When you left. I think today they're at. I don't know what the number is. That's higher number. But from 1 to 25, that's 100% you question for you. Did you guys buy other hotels or.

[Horst Schulze]

No, we talk about. Yeah, but wait a minute. We didn't own hotels. We managed hotels.

[Patrick Bet-David]

Right? So.

[Horst Schulze]

So for instance, we took owner. Owner existed. For example. We talk over hotel in New York. Consequently, I inherited a union.

[Patrick Bet-David]

Got it.

[Horst Schulze]

None of our. None of my hotels. I opened San Francisco. New union was picking us for three years, but it never became union.

[Patrick Bet-David]

So when you took you when you're. So you're taking opera. Like for example, two properties are opening up here in Pompano. One is Ritz private residence. One is Waldorf Astoria. I went and looked at a couple of them and they'll say Waldorf's gonna be managing this property for 30 years. So you were managing those hotels, servicing those hotels.

[Horst Schulze]

Okay, but. But we insisted. We wouldn't have written a contract anymore unless you sign. 50 years.

[Patrick Bet-David]

50 years to you guys.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

And what is the business model? How do you get paid?

[Horst Schulze]

I get, I get a percentage of sales.

[Patrick Bet-David]

Whatever sale they make you make, is it profit or is it rev?

[Horst Schulze]

I make off sales. If, if you, you own the hotel and they say the sales, 100 million, I get 3 million.

[Patrick Bet-David]

Got it.

[Horst Schulze]

And you may be losing money to operation.

[Patrick Bet-David]

So no matter what you're making your 3 million, it's more like a consulting firm.

[Horst Schulze]

Yes, in a way, yes. But I also have an incentive after, after you make that service, I am sharing 10 or whatever in the profit after.

[Patrick Bet-David]

Got it.

[Horst Schulze]

So I have an incentive to make a profit.

[Patrick Bet-David]

So If I'm doing 100 million, no matter what I do, I got to pay 3 million on my revenue. That goes to you. What is my, what is your incentive to make my 100 million, 200 million?

[Horst Schulze]

Well, I get, I get an incentive on anything, all but a certain profit.

[Patrick Bet-David]

Is it an accelerator? Like, does it get really bigger or. No, no, it stays Fairly at the 3% number.

[Horst Schulze]

Yeah, but, but at the same time, I drive sales up which, which I get my 3% on Amazon on the sales. I drive the rate up, I drive the income up. And of course, I drive the profit up and the profit. Now, now there is an exit clause for you, the owner. That means we established in the beginning who would be buying competition. Who are the three best hotels in town. If I don't, if I'm not within 5%, at least what they do, you can exit me, you can throw me out.

[Patrick Bet-David]

That's in the contract.

[Horst Schulze]

Oh, yeah. Oh, yeah.

[Patrick Bet-David]

But they also want the name Ritz Carlton on the, on the property.

[Horst Schulze]

Right?

[Patrick Bet-David]

They don't, they don't want to give.

[Horst Schulze]

Because it's not only. It's not only hotel. That's probably most likely, of course.

[Patrick Bet-David]

Yeah. Restaurant, all the other stuff that's benefiting as well. At the peak, what was the revenue of all the hotels you guys were managing at the peak under your watch?

[Horst Schulze]

Well, worldwide, we were close to $2 billion. Two billion, including clubs and stuff that we had, everything included. Yeah, got it.

[Patrick Bet-David]

So 2 billion, 60 million goes to you guys. Yeah, got it. That's a pretty nice revenue going to you. So you made some real good money.

[Horst Schulze]

Yeah, yeah, yeah.

[Patrick Bet-David]

That's great. So, but going back to it, so you would come in and your job was to inject the spirit and your philosophy to the way we managed our hotels.

[Horst Schulze]

Sure.

[Patrick Bet-David]

That's what you did.

[Horst Schulze]

Sure. Okay.

[Patrick Bet-David]

So.

[Horst Schulze]

And the processes. Make sure the processes.

[Patrick Bet-David]

For sure. And I love that. And by the way, the lady said the following. She says you guys have this thing. And by the way, correct me if I'm wrong. I'm just giving you what she said. She said they didn't. You guys did an engagement study to identify which employees fell where you guys found out that you call them superstars or Invincibles. Were 32% of employees who were energized and committed to do their work. Then 51% were neutral. You guys call them just there. They're just there. And you can correct me here. They showed up and do what is expected, but little more. And the last one was cave, which was around 17%. This is constantly against virtually everything. This is what the lady told me.

[Horst Schulze]

I never heard about.

[Patrick Bet-David]

This is not you.

[Horst Schulze]

That wasn't me.

[Patrick Bet-David]

What do you think about this analysis?

[Horst Schulze]

It's ridiculous.

[Patrick Bet-David]

Tell me why it's ridiculous. This is why I came to the source. I want to know what you think.

[Horst Schulze]

Okay.

[Patrick Bet-David]

Rob, are you tracking Rob, were you in that meeting? Am I giving numbers that were numbers that were given to us? So please continue.

[Horst Schulze]

It's. It's nearly pathetic. I'm. Please forgive me.

[Patrick Bet-David]

Okay.

[Horst Schulze]

I mean, please forgive me.

[Patrick Bet-David]

Why though? Tell me why.

[Horst Schulze]

Because. Because that means everything is wrong with the selection process already. If you, if you. If you hire those. Those poor percentages, then you better start selecting. Stop. Get somebody to help you selecting employees.

[Patrick Bet-David]

But you said your retention hit 19%.

[Horst Schulze]

Between 18 and 20% was.

[Patrick Bet-David]

That means you fired or lost 18 or 19%.

[Horst Schulze]

Yeah, that's. You want to have 10% because you want to renew a little bit.

[Patrick Bet-David]

So why did you lose 18 or.

[Horst Schulze]

19% about partially because people moved and. Or partially because. Or we did make mistakes. But when I make a mistake, I have this now I have to, ah, this employee really didn't work out. So let's look where we met our mistake and tweaked our process. Did we hire them wrong? Did we orient.

[Patrick Bet-David]

I agree with you.

[Horst Schulze]

Did something go wrong? I have to go back and tweak my processes, not the employees. And if I have those numbers, that means my processes. That says your processes are really screwed up. Start over. That's what that says to me.

[Patrick Bet-David]

Okay. How many times in your career did you fire people? How many people have you personally fired?

[Horst Schulze]

Well, I look at General managers roughly five or six.

[Patrick Bet-David]

Five or six you fired in 30 years at Ritz from 91 to 20 years.

[Horst Schulze]

20 years at Ritz. That's precluded. Hold it. That's between Ritz and capella. So in 30 years. Yeah.

[Patrick Bet-David]

Okay, so in 30 years, you fired.

[Horst Schulze]

Five GMs, general managers, managers.

[Patrick Bet-David]

Who. How often did you fire people at Hyatt? How many people did you fire at.

[Horst Schulze]

At Hyatt? Oh, that was earlier. And I work. Was working different. I want. I didn't fire gentlemen, but managers. A lot?

[Patrick Bet-David]

Yeah, a lot. What's a lot? 50, 100, 200 something. Okay, so tell me, what got. What did a person do to get you to a point of wanting to fire them?

[Horst Schulze]

Okay, for example, I, as a leader, we talk about delegating and so on, kind of. What, tested it. What? You delegate. You delegate, except you don't delegate your vision and your purpose. You don't delegate the standards, you don't delegate the values. You don't delegate those things. You delegate how you think. But you let people do things and then you measure and make sure they happen. You cannot hope then. Hope is not a strategy whatsoever. So you measure and you establish the expectation. You expect it to execute.

[Patrick Bet-David]

Makes sense.

[Horst Schulze]

So my expectation, for example, was. And that was a key element here, employee satisfaction, x customer satisfaction, 92%, top box, intended, return, intended, recommend, 92% minimum. And that was made very clear. If I hire you as chairman now, I said, patrick, now understand that is. Understand I have no right to compromise. I am here for all concerned. Sure, my. My right of compromising is over. So my expectation is X. Do you think you can handle it? By the way. And by the way, my role is to help you. Okay, I'm here, available. Call me anytime. I'm here to help you. I will come to your hotel and spend time with you. But I'm here to help you. But here's the expectation. Here are the expectation, customer satisfaction, employee specification, and so on. And I delegate you. And here's how our rules. When you go to orientation is how we do it. They learned that the employee is a part of the company, not just working for the company. They learned that any manager, that every employee works in an environment of belonging and purpose. Do you understand this, Patrick? I would say belonging and purpose. So we go through all that and then you have the precise numbers, and every year, the precise budgets, numbers, everything's clear. But now I see the customer satisfaction, which was my key. On the end of the month, I see you are 86%, but 92 is the minimum standard. So I call you party guy. You know, he Said H. No problem. Working on it. I got it. You will have careful customer service. You can dig into it. I don't have it. I don't. Look, I have no time for that. Was it front desk? Was it food? Was it what? What was it? Corrected next two. Next month is 94%. Now, Patrick, now listen, buddy. You understand, I'm cannot compromise that. You understand? I'm getting upset. Next month, 85%. Patrick, find a chair, put it in the corner of your office because your. Your desk will be mine. I'm moving. I will move in the hotel.

[Patrick Bet-David]

You're going to tell me this?

[Horst Schulze]

Yes.

[Patrick Bet-David]

And then how much longer after that? Are you firing me?

[Horst Schulze]

Oh, you. I would. I would keep you if you stand. If you stay at 80, if you stay in the hotel and work with me and correct it till this 92. And keep it, keep it there. I'm fine. But if it slips again, I said, Patrick, do me a favor, leave. You know when, when you start, Your number was 92. Yeah, yeah.

[Patrick Bet-David]

Month. Month by month by month. So at the beginning.

[Horst Schulze]

Oh, yeah, you can have a month slip. That's no problem.

[Patrick Bet-David]

Totally get that. But what I'm asking is. So every month, when you would look at reports and data, beginning of the month, when all the numbers are done, it's January.

[Horst Schulze]

Many things are data.

[Patrick Bet-David]

But what I'm saying is like at the end of the month, month is over. It's a new week. What reports did you want to see at all the hotels? What numbers did you want to see?

[Horst Schulze]

Customer satisfaction.

[Patrick Bet-David]

That's it.

[Horst Schulze]

Employee satisfaction, economics comparison and the future indicator of business that had to be above every year ago. The indicator a year ago was. We have already, hypothetically. Now, a year ago today we had for the year thousand reservation. Today I want to have more than 1000 for the next year. You understand?

[Patrick Bet-David]

I beat your prior bets. I fully get it.

[Horst Schulze]

So that was one of them then. Measurement. Of course. I looked at what was done, what the business for last month. Did we live up to the budget?

[Patrick Bet-David]

I.

[Horst Schulze]

How are we doing it according to the budget? Certainly I looked at the economics. Of course. I looked at the employee satisfaction. We did only one survey, but it changed slightly by telephone calls from employees coming in. And the satisfaction survey for employees changed. I looked for one question in the employee survey. I insisted to be there that said, would you hire your mother? Would you hire. Would you recommend your mother to work for our company? Would you. If your mother looked for a job, would you recommend that she works for us?

[Patrick Bet-David]

Are you asking me?

[Horst Schulze]

That's what I did. That's what it was.

[Patrick Bet-David]

I don't know if I'm recommending my mother to work at the company.

[Horst Schulze]

So what would you do in my company?

[Patrick Bet-David]

Are you asking a question to say, do you love the company so much that you would recommend somebody else?

[Horst Schulze]

That's right.

[Patrick Bet-David]

My dad's 83. I don't know if I'm recommending him, although he would be great customer service.

[Horst Schulze]

If it was possible, would you recommend it? Everybody understood that. If. If they say no question.

[Patrick Bet-David]

That's your most important question.

[Horst Schulze]

Yeah, most important question.

[Patrick Bet-David]

So it could be worded for. Would you recommend questions 36.

[Horst Schulze]

When I looked at that one.

[Patrick Bet-David]

Right, right.

[Horst Schulze]

But. But then I looked at the overall satisfaction.

[Patrick Bet-David]

Give me some more questions on the surveys. Employee survey. What else did you have?

[Horst Schulze]

Do you feel part of the. Do you feel part of the company? Okay. Are you. Do you know career. Your career path and so on.

[Patrick Bet-David]

Do you know your career path? What else?

[Horst Schulze]

Yeah, most of it. Send that around.

[Patrick Bet-David]

How many questions is it? How many total?

[Horst Schulze]

36.

[Patrick Bet-David]

36 questions every month?

[Horst Schulze]

Yeah. No, no, no, no. That survey was only done once a year. Thoroughly.

[Patrick Bet-David]

And what. What month did you typically do it?

[Horst Schulze]

Well, it depends on which hotel. When they open. We usually did it three months after they open. Done that same month every year.

[Patrick Bet-David]

I got. So interesting system. It's based on when they open up. It's not calendar.

[Horst Schulze]

No, no.

[Patrick Bet-David]

So it's not like December or January.

[Horst Schulze]

No, no.

[Patrick Bet-David]

So three months after they open up. So it wouldn't make sense to a different kind of a business. So different kind of a business. You do it annually and it's anonymous. You don't know who's answering it. It's just giving you data so nobody feels uncomfortable not putting it.

[Horst Schulze]

That's right.

[Patrick Bet-David]

And then how are you doing? Customer satisfaction scores.

[Horst Schulze]

An outside company call in. We get a number.

[Patrick Bet-David]

Outside company calls the customer.

[Horst Schulze]

Yeah, yeah. And they give you the analysis once a month. I get the analysis for each hotel intended return. So. So. So now I move into the hotel and. And the general manager is with me. Now, most. Most of them don't quit. I consider them to be fired. They quit. They have to sit in the office with me and I'm making all decisions. And so they're embarrassed and they quit. But what did I do? I looked at the survey. It's so simple. Everything. It's so simple. Everything. I looked at the customer service. Where were we impacted negatively by the doormen? They were not friendly. So what I do, I go sit down with all the doormen say, no, guys, please help me. It seems that we didn't help you or didn't train you right, and I'm here to help you to become a respected because you're not. But I'm here to help you and I'm accepting that we made a mistake here somewhere. So help me guess what? Four weeks later it was corrected. It was so simple every time. It is not rocket science. You go and talk to the people connected to the process, but if you're not, you're living in terrorism. Terrorism said, here's how terrorism said in the industrial revolution said, hire people who fulfill a function. We think, and they do, but this is ridiculous. After they do, they know better how to do it than I do my thing in my office. Instead of going to them and say, what can we do?

[Patrick Bet-David]

No, I love that, I love that. So, but how did you teach me? I come to you and I say, hey. And again, I'm talking for specifically this part because when you're talking about Stephen Covey and 7 Habits of Highly Effective People, and then you said, if a person after the age of 16, that's how they're going to be. Unless if they have a life changing event, which Stephen Covey would call paradigm shift, right? To help somebody have a paradigm shift, what would you do for your management team to have paradigm shift? So, for example, beginning of the year, you're doing a kickoff meeting. You bring your leaders in and if you did, what would you do to create paradigm shift in me, one of your leaders?

[Horst Schulze]

Well, with the leaders it's easy. I mean, I'm the expert.

[Patrick Bet-David]

Speaking into the mic with the leaders.

[Horst Schulze]

Is actually pretty easy because I'm the standard set. I'm the objective set. I set objectives and I asked them. I asked my leaders, my hotel leaders, when I was a manager, I asked my department leaders the same thing, by the way. I said, okay, tell me what they did the last three months to make sure that you have a better hotel. I asked them all, tell me, what is the standard, how your hotel will be respected a year from now. I want to see if they have a vision. If they have a vision. Look, I visited a hotel. In fact, I visited Milwaukee. The general manager picks me up, the general manager picks me up in the airport, which I always do. And I get the the same story, which is of course a lie. We are so happy you're visiting because nobody wants Corporal to visit because we're so proud. And I'm in a limo and I ask him all kind of questions and Then I ask him, what will be your position of your hotel? How will it be respected in the city a year from now? And he said, if I had a bigger ballroom, if my restaurant wasn't on the second floor, if this hotel would be closer to the city center. With other words, he made excuses for a vision he didn't have. I visited a few days later, Columbus, Ohio, similar city, similar hotel, built by the same architect. And I was general manager. And he said, you can check me in a year from now. We will be respected and be the pride of the city.

[Patrick Bet-David]

He says that to you?

[Horst Schulze]

Yeah. And I realized he's a. He's somebody has been. And when you walk to the hotel, you can feel in his hotel in Columbus, people feel part of it. The other hotel, they work in there.

[Patrick Bet-David]

Do you remember this guy?

[Horst Schulze]

Oh, yeah. Oh, sure, sure, sure. Now and then I said, wait a minute. I'm going to make a study of all channel manager who has a vision, who doesn't. And for the next three years I asked everybody the same questions. And after three years, mind you, is a study that I made. It wasn't scientific, but I'm generous. I mean, I tell you, there were five leaders. The rest were all managers. Now, they managed good results, some of them.

[Patrick Bet-David]

Out of how many people?

[Horst Schulze]

Out of 65.

[Patrick Bet-David]

Out of 65.

[Horst Schulze]

Five were leaders and the rest were managers.

[Patrick Bet-David]

8%.

[Horst Schulze]

Yeah. And now wait a minute. Some of those managers had good results.

[Patrick Bet-David]

Sure.

[Horst Schulze]

And by the way, the worst ones, and this is pretty common, became the recognition as manager of the year. They became a trip around the world and so on.

[Patrick Bet-David]

In Ritz.

[Horst Schulze]

Not in Ritz, in Hyatt, in other companies. Okay, right now. Why? Because it didn't paint anymore. And they didn't took the flowers away and they were applauded for making more profit and became manager of the as they're destroying the brand.

[Patrick Bet-David]

Why?

[Horst Schulze]

Because that's only thing corporate measures. Because they don't measure. That's why I measured. Number one, customer satisfaction.

[Patrick Bet-David]

Tell me your number one manager you had give me the profile of this individual. 3, 4, 5, 6 things you can think of what made him so special. Number one, the best one.

[Horst Schulze]

Number one. Absolute relentless communication with his employees. They knew what was going on. They felt part of a relationship in which the employees felt part was number one.

[Patrick Bet-David]

Okay.

[Horst Schulze]

Process management with employees involved in building the process.

[Patrick Bet-David]

Tell me what that means. Unpack for me.

[Horst Schulze]

That means in the book complaint and room service. Slow room service. He go. He goes to room service and says the order taker, bus boy Waiter, cook, work. Find out the root cause. Find the root cause of. Find the root cause. Why we have slow room service compliance. And the people connected to the process with the employees worked on it. I tell you his result. I tell you a result he had that is unbelievable. When you start, you learn the second day the non negotiables, which everybody gets in their pocket. If I catch somebody not carrying that in their pocket, I have a problem. General manager or dishwasher, I want you to carry it because that's who we are. And these are the non negotiables.

[Patrick Bet-David]

So may I?

[Horst Schulze]

Yeah. I give it you as a gift. It's in my book, by the way.

[Patrick Bet-David]

I love it. This is the Capella. Has it changed anything with Ritz?

[Horst Schulze]

Oh, sure.

[Patrick Bet-David]

So it's different than Ritz.

[Horst Schulze]

Yeah. Okay, a little bit. A little bit.

[Patrick Bet-David]

A little bit.

[Horst Schulze]

And Ritz changed it after I left.

[Patrick Bet-David]

Well, I agree with you that it changed. So this goes to every employee.

[Horst Schulze]

Every single employee.

[Patrick Bet-David]

At Capella.

[Horst Schulze]

At Capella, when you start working, you get it in your hand. You get learned.

[Patrick Bet-David]

I want to go back to this number one manager of yours. So number one.

[Horst Schulze]

That's what I wanted to say.

[Patrick Bet-David]

Okay, go for it.

[Horst Schulze]

So. So this, when we talk over that hotel, it was so strong union and was the worst employee survey and the worst guest customer survey ever had. New York. This manager got into New York.

[Patrick Bet-David]

And.

[Horst Schulze]

The employees slowly adopted that. I tell you how well he changed it. Two years later, the union contract was due. The employees insisted that the union adopts us. That's a general manager who was leading his people, who were part of the.

[Patrick Bet-David]

People for the union to adopt this.

[Horst Schulze]

That's right. The employees insisted on it. So what did he do? What did he really do? And that's what I'm appealing to. Every work, every boss, he offered them to be part of something. Even Aristotle said, you cannot be fulfilled in life unless you have purpose and belonging. Why wouldn't we offer that to our employees? That is really my number one point. Offer them purpose. Offer them belonging. Don't. Don't make them chairs. My major did the first one, Remember the one when I left there after three and a half years. He said, come here, look me in the eyes. Promise me you never go to work. Promise you me not to become a chair.

[Patrick Bet-David]

This is when you're leaving?

[Horst Schulze]

When I'm leaving. Three and a half years later now. I was seven.

[Patrick Bet-David]

Just a guy that impacted you heavily. Not the gm, but the other guy.

[Horst Schulze]

Yes. Promise me you to become a chair. Because if you just Go to work for the functions that you fulfill. You're a chair, you're fulfilling a function. You have to have a high intent. The high intent is excellence in what you're doing.

[Patrick Bet-David]

Promise me you don't become a chair.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Okay. So relentless communication with employees, process management, root cause, what else made that number.

[Horst Schulze]

Environment of belonging and purpose. And purpose.

[Patrick Bet-David]

Got it, Got it. So those three things.

[Horst Schulze]

Yes.

[Patrick Bet-David]

Promise me you won't be a chair. Okay, so question for you.

[Horst Schulze]

And again, he was relentlessly working on old process and continuing us. He was constantly seeking if. If it's very important, very important here. If a problem repeated itself, he was right away and said, okay, let's look at the process. Let's find the root cause. Why this process gone. A root cause analysis was his strength. And you know, here's the thing. If you find root cause of your mistakes, you become efficient because by eliminating the mistake, you improve the product and lower your cost instead of cost cutting, which means you take something away from the customer.

[Patrick Bet-David]

Question. This guy, who did he end up becoming?

[Horst Schulze]

He ended up becoming a vice president in. In the Beverly Hills Hilton for. For those hotels. And he around for many years. He just a year ago and so retired from there.

[Patrick Bet-David]

He reads. You still keep in contact?

[Horst Schulze]

Oh, yes.

[Patrick Bet-David]

So there's a friendship?

[Horst Schulze]

Oh, sure.

[Patrick Bet-David]

Incredible.

[Horst Schulze]

Well, friendship behind my back. Some of those guys got together and created a reunion for me a few months ago. And people came from Europe and Asia and all over. They're all running major companies. I know what happened. The truth is, I know what happened. They got together and said, horse is getting old. Let's get together before he dies. You know that is true.

[Patrick Bet-David]

Let me tell you though, let me tell you one thing that this is very important for the audience to know this. You're 19. So you're how old? You're January 10th. So you just turned 87 three weeks ago.

[Horst Schulze]

Right.

[Patrick Bet-David]

Okay. So Matteo, my EA, he brings you in. And I said, how does he look and feel? He says, oh, he's so strong. I said, tell me why. He says, I tried to take the back from him. He said, no, no, no, you can't take this back. There's a lot of money. I can carry it myself. Even at this age, with the level of intensity that you have, it's so impressive. So I got a question for you. There's a book that was written five years ago called After Steve, and a book is about, after Steve Jobs, what happened to Apple, okay. When Tim Cook took over, what happened to, you know, when you left Ritz in the early 2000s. What happened to the standards after Horst? Were they able to maintain it?

[Horst Schulze]

Well, let me tell you one story. I have to be careful here because I signed that I would. Would not make disparaging remarks.

[Patrick Bet-David]

However, 20 years you got. That's a long good.

[Horst Schulze]

However, our most complimented non negotiable in Ritz car was number 16. It's number 12. Number 12 on this one. And. And Kabbalah escort guest until they are comfortable with the direction and make visual contact with their destination, do not point. Okay. This was number 16. When that was the most complimented from the guest non negotiable. People around said, I asked her from this. I came from outside and they walked me all the way there. I cannot believe it. When I left, they eliminated that one because it costs money to take somebody away from this.

[Patrick Bet-David]

Stop it.

[Horst Schulze]

The most complimented point by customers was eliminated. And I understand where I come from, because nobody quite understood how deep those feelings were. You know, it was just, wow, that's what we do. Nobody looked up for the analysis that was most complimented.

[Patrick Bet-David]

Sure.

[Horst Schulze]

So, but altogether, who is rated number one today in the world? Capella. There's a company created afterwards. Where's Ritz in that analysis? 26. And those are facts. I can say facts here.

[Patrick Bet-David]

You were number one when you guys left.

[Horst Schulze]

Oh, sure.

[Patrick Bet-David]

They dropped from one to 26. And Capella's number one.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

How important was it for you to prove that even afterwards you're going to continue? Not stop.

[Horst Schulze]

I could do it anytime. I could do it any. Forgive me. Because I would concentrate on the human being and on the processes that I do. I would. In the meantime, I have to learn to even better select employees, be more respectful for them. And in particular, it's easier today because everybody complains about the millennials, but come on, learn how to handle them and do it.

[Patrick Bet-David]

I agree. I agree. It's a lot of time. Well, they've changed. They're lazy. They're this.

[Horst Schulze]

Come on.

[Patrick Bet-David]

You become a softer leader.

[Horst Schulze]

You're the leader. You're the leader. You have to figure it out.

[Patrick Bet-David]

Yeah, I agree. You know, it's crazy. When you read body language books, you know what they say about the lines in between the eyes? Do you know what they say about it?

[Horst Schulze]

No.

[Patrick Bet-David]

Highly, highly intense, competitive individuals.

[Horst Schulze]

Okay, okay.

[Patrick Bet-David]

You have those two lines. You have those two lines. Right here is what you have. So you're a very rare combination of extremely charming. And you know it. You're very charming. Very. And you have a fun side to you that it's it also feels like it's fun working with you. But my God, I feel the intensity and the seriousness that you're not going to compromise the standards for nothing. Is that a fair assessment of you?

[Horst Schulze]

But I. But let's face it, I have no moral right to compromise.

[Patrick Bet-David]

I have no moral right to compromise.

[Horst Schulze]

Of course not.

[Patrick Bet-David]

Tell me why.

[Horst Schulze]

I know my objective is good for all concerned. In that moment, I would be going against the owners, against the employees, against society, even against God. Because I question myself. Would God approve? I question myself. Very careful is my objective. Would God approve? In that moment I painted myself in a corner. I can't just compromise anymore. You know, that's one of the big problems with management. They want to be one, be known as a nice guy. That's not my business. When they make a speech, I don't go into the speech so that people think I'm a nice guy. I go into the speech so that I give something and what I think. What do you think of me? Particularly my age? What are you going to do? Fire me?

[Patrick Bet-David]

But when did you believe in yourself to know your philosophies worked? At what age were you bulletproof? Confidence that you know what you were doing?

[Horst Schulze]

When? When I went halfway through my time in Hyatt, I was. I talked to versatile and made it a major success. And I knew the philosophy works. It wasn't so much I'm the right thing. No, but the philosophy of respecting the employee and loving the employee and make sure they're aligned but not compromising and understanding the market and pushing those things together, that, that in a board meeting is fluffy conversations. But the same people have egos and feelings and totally ignore the feeling of those two entities that make a company. If you have a business here, you have a business here. Patrick, walk in here at 3 o'.

[Patrick Bet-David]

Clock in the morning.

[Horst Schulze]

Is it a business? No, it's not. But now it is a business because you have people in here. So it is the people who make it the business.

[Patrick Bet-David]

Great point.

[Horst Schulze]

I have to accept that.

[Patrick Bet-David]

Great point. Very good point. But. So you were in your 40s when you realized you were bulletproof, like you were confident in your philosophy.

[Horst Schulze]

I was totally confident because it worked. There were successes. And I knew in that moment I'm giving. I'm giving to people. I'm giving successes to people. You know, that is one of the artists and we have to be conscious of that too. And I'm happy to be a believer. So what? And one of the key elements that I. And Jesus, forgive me, that I touch on this for a moment. Is love your neighbor as yourself? Wait a minute. Are your employees not your neighbors? Are your guests not your neighbors? They are my neighbors. Do I love them as myself? But I cannot single out one or the other. I have to love them as a whole because otherwise I'm going against one and the other. If I just single out.

[Patrick Bet-David]

When did Psalm 94 get a hold of you? That I'm going to take you under my wings. How old were you? You talked about Psalms 94: somewhere.

[Horst Schulze]

Oh yeah. Oh well, growing up in the Lutheran church, which is very Bible beating oriented, we had for three years before you get confirmed with 14. You go to Bible class, the teacher, the pastor gets to know you well. And when you get confirmed, gives you word for your life. And he gave me Psalms 91:4. He will take you under swing on his 91:4. Got it? Yeah. And it is hanging in my kitchen.

[Patrick Bet-David]

How old were you?

[Horst Schulze]

14.

[Patrick Bet-David]

At 14 he told. He gave you that?

[Horst Schulze]

Yeah, yeah. And it was with me ever since. It is with me and is hanging in my kitchen.

[Patrick Bet-David]

Interesting to know that he's with you. He has your back.

[Horst Schulze]

Yeah. And, and, and you know, sometimes as a young man and so on, if I got it. But when something went wrong, I went to look and say, wait a minute, where are your wings?

[Patrick Bet-David]

Where have you been? I thought it was a promise. Yeah, that's funny. So now building the business, you know. And by the way, it's funny when you say Ritz Carlton, it's, it's clear because I go to Ritz a lot. But I had a bad experience with Ritz two months ago and I said, I wonder if horse would even allow something like this to happen. This doesn't make any sense to me. I was, I went to an event, Ritz Carlton. Every three to six months we would do an event at the Fort Lauderdale Ritz. No problem. This last one, we go there, my EA says, you know, they put us in a different room. I said, why is that? We booked this 30 days ago, 60 days ago. He said, I don't know. They put us in a big room. Well, I'm not looking for a bigger room. I want a smaller room because I put sticky pads on the wall. Cause we're doing a strategy session with our executive. I want that room. They change it last night. They can't do that. Well, I talked to the director. He said yes. I said, bring the director up. We get on the phone with the director right before the meeting. This is 7:57 and meeting starts at 8:00, clock, and the director's not coming upstairs. And finally I'm like, it's been 13 minutes. Where is the director? I'm talking to the other boys.

[Horst Schulze]

Wow, Horse.

[Patrick Bet-David]

I said, I'm going to go see the director myself. I go downstairs. I'm at the front lobby at the Fort Lauderdale Ritz. He's behind the desk and I see him. Finally I say his name. And I said, I don't know what his name is. I can get it right. And I said, hey, Jose, are you going to make me stand here all the time or you're going to come and talk to me? I've been asking you, why did you change my room? 30 seconds later, he comes out and he's looking at me. I said, why did you change the room? I always get that room. Look, we just had to make the decision last night. I said, I'm gonna go to the room right now to see if somebody else is there. You can't do that. So me and my security Dan, who was somewhere around here, I met him. You met him? He's got the tattoos on. It's like a very friendly guy. So we walk up to. We walk up to the room and they're running after us. And I go in the room. Nobody's there. I said, why don't you give me the room? So then afterwards, I'm trying to find out what's going on here. One of the guys that works at Fort Lauderdale, Rizzi, comes up to me, says, Patrick. I told them, don't change the room on Patrick. He's not going to like it because he follows the content. I said, I still want to know what happened to you. Anyways, the room was given to a soccer team, whatever, because they were doing massages there and nobody was there. Remember I booked this room. Yeah, it's the room I like. And I'm a be back customer, right? No explanation, nothing. The next day, Rob, can you text Matteo? I want to make sure I give the right first names. I don't want to mess this up. So then the next day, Matteo calls me. He says, look at the email we just got. I said, what's the email? He says, they send us an email saying they apologize for what happened the day before and they want to give us 50% of the cost for the room back. And I said, matteo, I don't care about the money. I will never.

[Horst Schulze]

And it's all or nothing.

[Patrick Bet-David]

I will never go to that Ritz Carlton and Fort Lauderdale ever again. I said, there is no way this is horse's standards. So I'm telling him this and they're going back and forth, back and forth, back and forth. And it was done. I was so disappointed. And you know what it made me think about? Here's what it made me think about. Here's a challenge horse and you got to coach me through it. And I need your help with this. Hear me out. And you don't know where I'm going with this, but I think you'll see it here in a minute. I'm a founder of an insurance company. We build it. We grew it from zero to 60,000 agents. We sold it. We changed a lot of people's lives and we did something nobody thought was ever possible. Our mission statement In July of 2009, when I came up with it, two and a half months before I started a company was saving America by bringing back the free enterprise system and hope to American families. And we took this concept. I was dressed as George Washington. My wife was dressed as Lady Liberty. We had a 40 foot Mount Rushmore on the stage. And we told everybody, we're going to save America and we're going to help people through free enterprise. Getting people to become insurance agents, building their business. We did something nobody thought was going to happen. One office, Northridge, 50 states. We grew it. I sold the company three years ago. I haven't been the CEO for one year. I'm gone. Okay, the standards are the standards that you create. How do you deal with looking and seeing if those standards are being maintained or not by the leaders that come after you? How do you manage that yourself? Because I know just listening to you right now. This episode is brought to you by indeed. Stop waiting around for the perfect candidate. Instead, use Indeed sponsored jobs to find.

[Horst Schulze]

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[Patrick Bet-David]

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[Horst Schulze]

I got an email from a friend in Asia. It's on bed. About an experience in Ritz Carlton. And it gave me so much pain. Still gives me pain. You cannot help it. Because if you have born an organization like you have, you give birth to that. You put pride and fulfillment into it. It is not a place, it's not a work, it's a fulfillment there. And done it if it is totally mishandled. And here, 20 some years later, I'm still hurt and in pain about it. I have a hard time. I try not to stay in Ritz Gardens because when you walk into it, I feel I'm a stranger. Some of them I walk into, I feel I'm home still. I'm home. Very few. Very few. Forgive me when I say those things. Ritz Carlton, don't sue me. But is. If you have value in what you did, if it had a meaning, if it was a purpose, you cannot help but get hurt. Because that which you created, it's a. It is not different than if Picasso would sit there and you would scratch on his painting. He would be very hurt. It's his painting, it's his creation, would be hurt. You cannot get away from that. And unless we just created a business, the heck with it. But if that business was created with the heart and with the soul, which hopefully we do as human beings, particularly as creator, you get hurt. You cannot get away from that. I was so hurt a few days ago. Few days ago. And I got that email and I was so hurt. I still have it on my phone. I was really hurt.

[Patrick Bet-David]

20 years later, you're still hurt.

[Horst Schulze]

Yeah. And I walk sometimes. Often. In the one that you mentioned, could it be any other brand? Yeah, yeah. It shouldn't be. It should be in Dense. I had a call one day from Shanghai from a friend who walked into the Ritz. Carl, maybe when I was running Ritz Garden, I said, I walked just in the Ritz Garden. And darn it, I could have complained, not seen a sign. I would have known it's a Ritz Garden. I could feel it, how people looked at me, how people say, sir, how people help me. I would have known it's a Ritz Garden. Unquestionably, that's what you want to create. That's it. But you can create that with a hardware store. You can create many. That's what I mean. It's hospitality that makes a difference. That makes a decision. It's not a product. You know, by the way, hospitality. Let's see what it is, really, it's service. Everything talks about is hospitality here. The first person who taught hospitality was Saint Benedict, the creator of the Benedict monasteries throughout Europe. He sent a letter to the head of his monasteries in the year 500 and said, if a guest arrives, treat him as if it was Jesus himself. But otherwise treat everyone as if they were the most important people in the world. And he recommended. In fact, even if you're on a fast, break your fast, if the guest by himself and have dinner with Them after you wash their feet. Now, how close do we come for that? Why wouldn't we try and come close to that in businesses? Isn't that much more fulfilling for us rather than just fulfilling a function?

[Patrick Bet-David]

Yeah. No, listen, the guy that you went into your room who runs our cigar lounge now, his name is Mikhail. I have to give him a shout out. Mikael was the general manager of an Italian restaurant here that I would go to three times a week. I know told you the story.

[Horst Schulze]

Yeah, but no, no, no. You used to three days, but you ended up going five days.

[Patrick Bet-David]

Yes, but let me tell you what happened with them. Finally one day he wants to start his own thing. I said, why don't you come here, run this whole place. The feeling he gives you horse. He's able to make the customer feel like you're the only thing that exists in the world. It is such a valuable skill for human being to have. It's such a valuable skill for human being to have, and I'm willing to pay premium for that. It's a very, very valuable thing for somebody. You work hard. You want to go to place to be left alone. So where do you go to right now? Restaurant. Where do you go to right now? Where you feel like the service here is impeccable? What are some places you go to that you like the service you get?

[Horst Schulze]

We have some small places not known in Atlanta. You see, when I travel still 100 days a year, I used to drive over 200 days a year. What happens when I arrive somewhere? They pick you up at a limousine to take you to gourmet restaurant. I don't want to go to gourmet restaurant. When I come home with my wife, we stay home or we go to some similar. But people know us there. And so you have the attention because they know you. And people say, we are glad you're here. And that's what you want. If that gentleman in the and Ritz here would have said to you, my gosh, please forgive me, I messed up.

[Patrick Bet-David]

And I would have moved on.

[Horst Schulze]

There you are.

[Patrick Bet-David]

I would have, by the way, I would have moved on the moment if he would have just came up and give me the attention and say, we messed up. He told me the truth. And if there was a valid reason why they moved the room, I would have had no problem.

[Horst Schulze]

But that's what we what we certified earlier. We talked about that. Every employee on problem, the solution. We certified every employee, 24,000 employees around the world. And they said the first thing is you listen to the complaint you listen, then you show empathy and then you apologize as if it was your own, but you own it. And then you make amends. And 50% is not an amendment. A situation like that, we will not, of course we will not charge you. Of course we will give you 50%. No, of course we will not charge you because we mess up.

[Patrick Bet-David]

Yeah.

[Horst Schulze]

Forgive me.

[Patrick Bet-David]

Yeah. And that's what it was. By the way, the guy that helped us out, his name was Juan, very nice guy. He said Patrick. I told him, don't do it. The director of events was a guy named Chris. I won't say his last name. And then the other guy that called us the next day, the director of operations was a guy named Sam. And Jose was the gm. And I think Jose is the one that sent the email. For 50%, I was very turned off. I was very turned off by that.

[Horst Schulze]

I mean 50%, I could care less about the money, but it doesn't matter.

[Patrick Bet-David]

Who cares about the money. Like, you know, all you have. So again, that's the challenge, right? A brand. If the, if the existing founder, driver, CEO doesn't run customer service properly, Starbucks hires a guy that comes to them. It's a previous guy from Pepsi who used to be a consultant for some big consulting firm. They bring him in, 18 months, revenue drops. It's a messy of a culture. Then they bring a guy named Brian Nichol. Brian Nicol comes from Chipotle. He gets in, he changes the culture. Starbucks is back on the rising. One great leader can change a company.

[Horst Schulze]

Of course, of course. Because you as a leader, you establish the philosophy comes from you. Because people immediately below you copy you. And it goes all the way down. And if you do something negative, they think you want that. And that's it. All standards are gone. That's why I say that you don't compromise standards. You own the standards. As a leader, you understand us. And. But coming down all to a simple thing, I cannot expect my thousands of Starbucks to all each one be singly trained by me. But they all know, they all should know. Here's the standard. We are here to care for people. They have to know that and they have to be a reminder of that. We remind those 20 things. You cannot go to work. You will be a reminder of one of them today. Today is number 12. Tomorrow 13 and 20 days. Number 12 again.

[Patrick Bet-David]

I love that dude. Pointing finger. There's a bathroom horse and we use a restroom right there. Walk down here versus and done it.

[Horst Schulze]

Done at four cars and you get lost.

[Patrick Bet-David]

I mean, yeah, versus somebody Takes you there.

[Horst Schulze]

So, and then we taught them, of course you would take them there and you, you create a relationship. You say, have you tried our restaurant? Are you a hotel guest? Yes. Have you tried a restaurant? Hope you had a chance if you're outsider. But you, oh, you didn't. Don't send hotel. But you should try the restaurant. Everybody likes it. So you have conversation and you're selling something at the same time.

[Patrick Bet-David]

Selling something? Yeah, you're. What would you say is your biggest gift? Like, what's your superpower?

[Horst Schulze]

Mine?

[Patrick Bet-David]

Yeah. What's your superpower?

[Horst Schulze]

Oh, relentless.

[Patrick Bet-David]

Relentless?

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Would your wife say the same thing about you? Yeah, she would say you're relentless, probably.

[Horst Schulze]

But, but in, in, in, in a positive way. Think about wife, think about marriage. I, I, it's the same thing. What is your high intent? What is it? When I got married, before I got married, I picked up, I saw my wife and I was so much in love. I mean, come on. I mean, young man, you look, wow, wow. This beautiful, wonderful human being. And we can get married. And then I thought, wait a minute, I know friends are getting divorced because they don't feel like it anymore. And then I establish my high intent. I will be in love for the rest of my life in that moment. And that is the model of leadership. Have intent, purpose. But then you have to commit yourself to it, not to have a pipe dream. And then you have to initiate the things that make it happen and keep focus on it. And that's where people break down. They break down focus all of a sudden on an excuse.

[Patrick Bet-David]

What was your philosophy in raising kids?

[Horst Schulze]

Raising Chris? Two things we want to accomplish, my wife and I, please forgive me, everybody. We want them to be believers, okay? And we want them to have, understand the difference between wrong and right. Integrity, people with integrity.

[Patrick Bet-David]

That's it.

[Horst Schulze]

That's it. That's it. Those are the key things that we worked on, prayed for, and were successful.

[Patrick Bet-David]

Are they in the business you're in or no?

[Horst Schulze]

No, they're not. Not at all.

[Patrick Bet-David]

Is it two girls or four girls?

[Horst Schulze]

Four girls. Okay.

[Patrick Bet-David]

I'm going to make sure I get that fact right, because two places said two different things. Yeah, that's great. So you got family.

[Horst Schulze]

Even, even family, you have to have objectives. My, my objective was to be in love, and I am in love with my wife. But I work on my mind. Even from when I drive into the driveway, the gate opens, I say, thank you, God, for my wonderful wife. I can't wait to take an arm now.

[Patrick Bet-David]

Affirmations.

[Horst Schulze]

You have to work on it. I mean, if you let. And I'm multi minded on that. First of all, I want that for me. Secondly, I see the end of family happens and that it will be the end of our civilization. Unquestionably, Unquestionably. If as family goes. So I am zealous about what is marriage. Work on it. I, I ask in every, in every speech. I asked him, oh, guys in this room, when have you asked your wife last time how you can be a better husband?

[Patrick Bet-David]

She'll tell you. I saw that.

[Horst Schulze]

Oh, and after she cries, she will tell you.

[Patrick Bet-David]

She will tell you. Did you guys ever have a moment where it didn't work out?

[Horst Schulze]

Oh, sure. Many.

[Patrick Bet-David]

Really?

[Horst Schulze]

In between? Not we know where it didn't work.

[Patrick Bet-David]

Out, but it was like close, fallen out.

[Horst Schulze]

No, not quite there. But there was fights. Not. Sure. Yeah.

[Patrick Bet-David]

How do you overcome that?

[Horst Schulze]

Sure. By sitting down, talking and admitting that you were wrong. It was my wife, who is 14 years younger. So I married, I'm 14, she's 26. And we have an argument and I start screaming and she said, why do you scream? Why don't we talk about it? Maybe you're right. She said that to you? I said, here, this kid is teaching me how to communicate.

[Patrick Bet-David]

Good for her. Wow.

[Horst Schulze]

And I realized I didn't want to talk about what if I'm wrong? Wow.

[Patrick Bet-David]

Yeah, let's talk about it. Maybe you're right.

[Horst Schulze]

Maybe you're right.

[Patrick Bet-David]

And you guys been married now what, 47 years.

[Horst Schulze]

47 years, yeah.

[Patrick Bet-David]

Unbelievable. Good for you.

[Horst Schulze]

Oh, it's great.

[Patrick Bet-David]

Good for you. Respect for doing that.

[Horst Schulze]

What a great thing.

[Patrick Bet-David]

Unbelievable.

[Horst Schulze]

I mean, look, what is this marriage. The only God ordained union, the greatest union there is. Why wouldn't you work like crazy on it?

[Patrick Bet-David]

And she was a partner with you while you're building, traveling, moving, all this stuff?

[Horst Schulze]

Yeah, yeah, yeah. Wow. Let me tell you, I admire her for her. She raised children and I was on the road and there too, I come back and I said, here's what we're going to do. And she said, whoa, whoa, whoa, whoa. Here's what we have planned. And I had to learn in the beginning. So wait a minute, here's. This is how. And he said, when you went here, we had to make decisions. I had to learn to communicate that way and respect decisions that are being made with much more input and points that I wasn't even aware of.

[Patrick Bet-David]

You were not there. You were not there. And that's. So a couple other questions before we wrap up. You won the Malcolm Baldrige National Quality Award twice 92 and 99. No other company has ever done this before. So what is the significance of that? Because that's straight up from the White House. Right? That's straight from the dc. What is the significance of that?

[Horst Schulze]

Well, it's a fantastic thing that the government did more intensely. That happened during the, during the 80s when the Japanese became major competitors to us. They were taking over. They're buying everything and controlling and product and cars and everything. No, we didn't make normal TVs when the Commerce Department said we have to study how to be more competitive with it with the Japanese. Studied the number one companies in the world, studied the companies that were sustained leaders in their product for many years. Why? And so on. Found commonalities and created a criteria.

[Patrick Bet-David]

And.

[Horst Schulze]

Afterwards said we have to find out who in America has comes close to that so we can make it an example for other companies.

[Patrick Bet-David]

Got it.

[Horst Schulze]

So when you studied and done apply if you win the polish, you are obligated to open your company up for other companies. Come and learn for a year free.

[Patrick Bet-David]

What a concept.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

For a year for free.

[Horst Schulze]

Yeah. We had every Monday, 20, 30 companies there to learn. We created a learning center. Now I figured out how to make money on it. So we started at 7 o' clock Monday mornings. So they had to check out and someday check in and something.

[Patrick Bet-David]

So they still got to book the role. That's great. So the companies would come and learn.

[Horst Schulze]

Come and learn from us. If I'm including, including Job, Steve Job, before they went into, before they went into retail.

[Patrick Bet-David]

I was about to just say Apple. So Steve Jobs came to you?

[Horst Schulze]

Yeah, yeah. Including for retail, Including Disney was there many times and so on. People coming in and learning how do we work, the processes, the measurements, the process, the improvements and so on. And we were pretty good at as I said that Chinamanshaw was kind of best at the improvement. The elimination of process permanently. I tell one story in the book, if you read it. Excellent wins and excellence in room service. Room service. Where we had for six years a complaint. I was the general manager of the first one. Obviously there was no other hotel during my time. The complaint room service. I managed it like a normal manager. I said, read my lips fix it doesn't work that way. You have to find out their process. I learned very carefully from the Bottage office how to do that. I had my first British meeting. Somebody said it up, we were the best hotel company in the world. And I had a lot of complaints when somebody said, well, I understand. They asked Me, best hotel company. I said, maybe we're the best of a lousy lot, but we are not very good. And he said, you should look into the Polish criteria. Went to Washington, had a meeting with the head. He explained me the criteria for in half an hour. I didn't understand about. He said, literally. And he said, you have time for lunch? At lunch with him years later, he asked me when I was became an expert in the issue, do you know why I invited you for lunch? I said, why? He said, you didn't understand the word. I said, he knew it.

[Patrick Bet-David]

Why didn't you understand what he said?

[Horst Schulze]

FISHBOWL ANNOUNCER Pareto charts and things like that.

[Patrick Bet-David]

I see. I got you. So he knew.

[Horst Schulze]

Yeah, you have to understand, I left. Left the school when I was 14 years old.

[Patrick Bet-David]

That's right.

[Horst Schulze]

I didn't go to business school.

[Patrick Bet-David]

No college, no business school.

[Horst Schulze]

But later when I was here, I took the courses in Cornell and so on.

[Patrick Bet-David]

Didn't you later on get a PhD or doctorate from some school? What an honorary doctor? Which school was it that gave it to you?

[Horst Schulze]

I'm sorry? I said it was not. When you ask me names, I'm always put in the word Johnson and Bales.

[Patrick Bet-David]

Okay, got it. Very cool. Yeah, very cool. So. So Steve Jobs, what did he ask you when he was.

[Horst Schulze]

I wasn't involved in teaching him at the time. I was out in, in Asia at the time. But he came into us. How do we treat customer? What, what, what do you think make us successful? How do we make them successful? By saying hello. But. And he, he picked up. I know what he picked up. First contact. We teach and that's what he. He got it. Most of people don't get it. Even what we teach. The behavioral analysts tell you, you make it. You make a decision about somebody when you come within 10ft. So how do I make sure you make a good decision? But wait a minute. They make a decision about you. So how make sure that decision is a good one. That's why when you go into. They have somebody staying there right away, well dressed, so say, welcome, can I help what is important? And they take you. And we had learned that from the behavioral analysts. I work with behavioral analysts, University of Colorado and Frankfurt. They said the decision is made about you the moment when we make contact. That's why we taught you when somebody comes within 10ft, no matter what you do, you look them in the eye and say welcome. And so on. Don't say hi. When you say hi, we are equal. But if I say welcome and so and look at you in the eye. I'm saying I respect you but at the same time, Sam, you can trust me. I'm professional. So we make sure that I hired kids from center City who have never seen anything elegant in their life. So now we put them in a great outfit. We teach them not to use certain words. Don't say ever High, don't say okay, say my pleasure and so on. And three weeks later this kid meets potentially with the chairman of the board of bank of England. And it works. And it works. That's what he saw and that's what he how he created the detail and be impressed by the look of it. Have this positive in mind. We, we looked by the way it's very important for people to know business to know. We looked at 400000 common cards. Beginning we had common cards. Chetty Power analyzed them for us whenever the first.

[Patrick Bet-David]

400000 common cards.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

What does that mean?

[Horst Schulze]

Guess that commented in the rooms comment cards.

[Patrick Bet-David]

Got it. 400,000 comment cards.

[Horst Schulze]

Got it. They're not scientifically that important. The call in are much more scientific by the way. But anyway when I had them I worked with Chetty Power. Dave Power was a friend. They talk and analyze them and they came back and said 100% without exception. 100% when the first contact was excellent. Never did a complaint follow. Positive, subconscious. Whenever there was one negative in either reservation, dormant or front desk always did complaints follow.

[Patrick Bet-David]

Wow.

[Horst Schulze]

I mean wow. So I have to make sure that my first contact. That's why when you walked in Ritz Garden first contact, that's why you saw huge flowers first thing you saw everything positive in your subconscious so you feel positive about the rest.

[Patrick Bet-David]

What presidents did you serve or which world leaders came to you guys at Ritz that you had a relationship with? Was it a. Was it an ongoing. Hey, we're going to come in. We'd like to be taken care of.

[Horst Schulze]

Yeah. Well I knew and I pushed the second one very well. I knew him very well and I knew Carter very well. Carter. In fact after he was president he had he later he had an apartment in when the library was built but before they were staying in the Ritz. And every morning he went chalking. We went jogging every morning.

[Patrick Bet-David]

Oh Buckhead in Atlanta. I got it makes sense.

[Horst Schulze]

And we went shopping every morning we come around the corner people go to worker and we say good morning. Take a look. Oh, good morning. Of course security was running with us.

[Patrick Bet-David]

Yeah. You felt safe.

[Horst Schulze]

I knew them very well. Of course I had Clinton Gave me the award. I spent time. And Bush 1 gave me the award. And Ford. Ford was an owner of one of our hotels.

[Patrick Bet-David]

Really.

[Horst Schulze]

So I.

[Patrick Bet-David]

Interesting.

[Horst Schulze]

I knew several.

[Patrick Bet-David]

Got it. Very interesting because I can only imagine that everybody comes in. By the way, two questions before we wrap up. Patel Motel Group. What do you know about the Patel Motel Cartel that you don't know anything about? You know how they say they own 70, 80% of hotels and their business model and the way they do it from India when they come in? You know nothing about those?

[Horst Schulze]

No, no, I don't know much about it.

[Patrick Bet-David]

It's a very interesting story.

[Horst Schulze]

I heard about it, but I don't know much.

[Patrick Bet-David]

Yeah, it's. Apparently they bring their families. Yeah. And so the families would live in five rooms. And the family's living in five rooms would allow them to charge the rooms at the lowest 29, 39 bucks a night. So others would stay over other hotels and the next thing. That's how they build their empire. Apparently now they want 70 of hotels in America. Yeah, very interesting.

[Horst Schulze]

I don't think 70, but they own quite a few.

[Patrick Bet-David]

That's the numbers that you'll read about. Yeah, right there. Roughly 70 of all Indian motel owners.

[Horst Schulze]

Oh, in. Yeah, Indian motel.

[Patrick Bet-David]

Third of all motels owners in America are named Patel.

[Horst Schulze]

Yeah. Well, there are a lot of Indian hotel motel owners. A lot of them. They come in and that wasn't easy business to go anyway, having some cash to bought a motel and run it and then edit, edit, edit. So a lot of Indian hotel owners here. Yeah, yeah, of course. A couple of very good Tash hotels. Is a very good hotel company.

[Patrick Bet-David]

Capella Group. Your. Your most recent one that you sold, I think you said 2017 and then finalized in 2019. You. You built a lot of the hotels in Asia and I think one or two is in Saudi that you build. You can correct me if I'm wrong on these, but none in Europe. Why not Europe?

[Horst Schulze]

We had one in Europe.

[Patrick Bet-David]

You did build one in Europe.

[Horst Schulze]

One second, we're not owning. Yes.

[Patrick Bet-David]

Their own operating. I totally get it. Right.

[Horst Schulze]

One was in Europe in this little. But when I left, they disassociate themselves. They were able. There was a clause to get out when I left.

[Patrick Bet-David]

Oh God.

[Horst Schulze]

So they left their independent. Interesting. Great hotel.

[Patrick Bet-David]

Interesting. What markets do you look at to say these markets are good to build a hotel? Is there anything you look at? What demos do you look at?

[Horst Schulze]

Well, you know what I wanted to be. I looked at this at the time and still the same thing. If you start a hotel company or you work hotel company, you want to be in New York, you want to be in London, you want to be in Tokyo, you want to be. At the time, Hong Kong was a number one thing. Today, Singapore is equally important. Still, Hong Kong is okay, but it used to be the financial place where you had to be. Singapore today, Marshall. So in the key places. No, but. But my first hotel was Atlanta and done Dearborn, Michigan, and so on. And I had to still make it number one in the world. We became number one in the world, you know, and I dealt. Later, my competition was Four Seasons. They were in London and in Tokyo and in New York and then everywhere. And I was, you know, now we ended up to be in Tokyo and so on also. And when we opened Osaka, we were immediately awarded the best hotel in US In Japan, you know, I. I insisted. Wherever we are, we're number one, period. And. And I dealt with the general manager. Will you accept that?

[Patrick Bet-David]

Did you play sports as a kid? Where does your competitive fire come from? Why are you so competitive? No, you're very competitive.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Mom or dad, who's more competitive? Like, because you're very competitive.

[Horst Schulze]

I think. Mom. Mom.

[Patrick Bet-David]

Yeah, mom was competitive.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Did mom and dad ever come to the States or. No, they.

[Horst Schulze]

Oh, yeah. Oh, yeah, yeah, yeah. But you have to understand, when I started off, particularly my grandfather, they all were embarrassed that I want to work in a hotel business. That's not what they did in Germany. You want to have a technical job. If I would have said roofer, that's honorable. Over a hotel, that's honorable. But in a hotel. So my father thought I would work as a Veda for the rest of my life. And I was disappointed. But then, of course, I had my successes. They were very proud.

[Patrick Bet-David]

Do you ever take your girls back to the city where you grew up in? Do you ever go and show the family there?

[Horst Schulze]

We spent every summer there.

[Patrick Bet-David]

Every summer there. Why?

[Horst Schulze]

That's who I am. And I'm lucky my wife loves it as much as I do. Otherwise, I wouldn't have house anymore.

[Patrick Bet-David]

What's great about the city there now.

[Horst Schulze]

It's a village. It's a small village where you, like. Like. She just was there for a couple of days with my daughter, and she. She called me and said, I feel this peace again. I walk through the little village. It's. It's. It's dark and quiet. But I heard some people singing. The. The glee club is rehearsing. And I heard some. And I said in the piece, when I Come back in the house is a piece that I cannot find anywhere else. And we feel that. We feel that it's a different life, but it's also. I grew up there and I don't want to become somebody else. I want to be the boy from the village. There's something about that. In the meantime, I'm American and I love the country. I have the same fears and hopes that most of us have that the fears have developed dramatically over the last 20 years in America.

[Patrick Bet-David]

What ways?

[Horst Schulze]

Well, the values we had a country give you an opinion about it and I hope that the world is not going to end. We had a country that had clear values, Judeo Christian values. We didn't have to be believers, but we had Judeo Christian values. Now we have 350 million different values. Each one runs around because we didn't insist. We gave up teaching those values. We gave up showing consequences if you don't, including eternity teaching in school. We have given up who we are, but we still want to be who we were. That's kind of silly, but that's what we have done. And so we are on the. On the edge of one way or another. We talk about socialism and the people that talk about socialism don't even know what it is. I haven't heard anybody explain socialism to me or even those leaders that are foreign, that are against it. The key element that America should know about socialism and doesn't. If you look at the countries that were socialists, including Cuba, but take Europe, take all of the Eastern European countries for 70 years in socialism, communism, 70. Take Russia out of the equation for a moment. All the other countries in 70 years, we talk about freedom. There's something much deeper. Show me one thought that came out of those countries in the 70 years. But otherwise you eliminate thinking. And that's what we want and that's what we look at. Well, we learned before that. And if we would still have Judeo Christian volition, we wouldn't accept it in the first place. That's socialism. But we talk about it all I can say to you, America, where the hell are you going? We still. Oh, are we a critical God shed its grace on thee. Yes, but my goodness, we should really worry right now. We should really be concerned. We should really do something.

[Patrick Bet-David]

What should we do?

[Horst Schulze]

We should demand and insist on thinking. Now, if I am going to say men can have children or if I cannot answer that question, that means I am not thinking anymore or I refuse to think. If I am in a city like Detroit, which is a disaster To a great extent. Please, Detroit, don't call me. But it is. I lived there for a while, for 80 years. Yet I vote every year for the same. Every time for the same party. I am not thinking we have to encourage that. People think in our schools again that at least they know a bit. What do you think about? You had a again high intent. Why do they march against moving illegals? Because they have no intents. They have no purpose themselves. They have no purpose. So you look for a momentary purpose which is gone and done. You're really helpless. Purpose. We have to teach people again to have purpose. High purpose. Purpose of value. Purpose for a great country where we respect each other. Purpose of having a life that is fulfilled. We can think, we can express. Go and look at them. Could they express? No. That's why no thought came from Eastern Europe. Those of us who lived it. Actually, I lived it. I went every year to visit my cousins in East Germany. The stories I can tell you, it's unbelievable. And that's what we want because we have no higher purpose.

[Patrick Bet-David]

Can you share one story? One story. When you go visit East Germany from your family, what they experienced?

[Horst Schulze]

Okay. My cousin, chief anesthesiologist in the number one hospital. I walk to the sidewalks without light and with holes. In East Berlin, I walked to her apartment. This old stairway with one bulb hanging down, going into her apartment. She is a chief anesthesiologist. Her husband has this little technical magazine that he owns that he does that was lost ownership in the apartment. In the kitchen they have a plastic square with plastic curtains as their shower. Okay. That's how you live. And they have. But they have applied for another apartment. The average wait for another apartment is 10 years.

[Patrick Bet-David]

Wow.

[Horst Schulze]

They also had applied for a car six years ago, but it's not there yet. Now you tell me this works. And speaking up against it, they were not allowed. After all, you're not allowed to think. So how can you get creative? Now the wall comes down. Four years later I visit them. They have a new house by a river with two Mercedes staying there. They live in a free country where they can work, make a win. What do you want? But they did work for that. Now you cannot live in a free country and hope that somebody buys it for you. That is that you sentence yourself into that position. But you sentence yourself. It's not others. You define yourself. Not the government, not the president, not the other race. You define yourself. That is the thing. And they. They were defined by the government and suddenly come out and decide to define themselves. As winners and they're winning.

[Patrick Bet-David]

Yeah. Good for them. I, I mean, yeah, I, I, I went there in 89, I lived there in 89. And Germany was you guys. In 1990, you won the World Cup.

[Horst Schulze]

Yeah, right.

[Patrick Bet-David]

That's when the famous singer was Matias Chaim.

[Horst Schulze]

Yeah.

[Patrick Bet-David]

Was the song, Something like that. That's when David Hasselhoff was God, when sat eins was the channel. And you guys had a wheel of fortune called Rudy Tootie Frutti, something like that. I don't know what it was called. The show with the girl, you know, half naked girl doing wheel. Very weird. From Iran. You go there, you're like, wait a minute, what's going on with Germany?

[Horst Schulze]

What's going on? Yeah.

[Patrick Bet-David]

I had a great time in Germany, though. I had a very good time with good memories in Germany. Horst, I can talk to you for hours. The amount of wisdom you have is unbelievable. And in my mind I was hoping for this conversation and it was even a better conversation than what I thought it was going to be.

[Horst Schulze]

Thank you very much.

[Patrick Bet-David]

So I appreciate you for coming down and sitting down. For the folks watching this, we're going to put the link below to the book Excellence wins. We'll put the link below for folks to go support this. The rest of the ideology will be in the book as well. Horst, thank you so much for this. My pleasure having you on.

[Horst Schulze]

I have gone through many sessions. It's how the discussion runs is always up to the interviewer.

[Patrick Bet-David]

Well, it was very easy talking to you and I learned a lot. Thank you, sir. Appreciate you.

[Horst Schulze]

Delighted.

[Patrick Bet-David]

Success is built on how you think. Influence is built on how you show up. Every detail matters because presence speaks before you do. This is more than style. The future looks bright.