The service quality philosophy have gained in importance in recent years and has been the subject of much conceptual and empirical research. The studies undertaken, however, have primarily focused attention on the financial services, healthcare and professional service sectors, and have not generally included analyses of quality in the hotel industry. Also, the former have not addressed the possible relationship between service quality and business performance, and the competitive implications of adopting and operationalising a quality ethos. The exploratory study reported in this article focuses on the nature of service quality in UK hotel organisations, and examines the performance implications of institutionalising service quality initiatives. Although a large proportion of respondents acknowledge the importance of developing, promoting and measuring service quality it would appear that few managers at the unit level have systems in place to effect implementation. The results also reveal that firms who have adopted quality policies do not exhibit exceptional performance in financial and competitive terms. It is concluded that further research needs to be carried out to establish empirically whether service quality implementation practice is consequential for business performance.