The Ritz-Carlton: A Transparent Work Culture

Many organizations today are jumping on the transparency bandwagon. Author Nan Russell points out in her article Trust: The New Workplace Currency, “Transparency must be thoughtful. It isn’t knowing everything or telling everything.” She also asserts that “Transparency that isn’t thoughtful can diminish trust.”

Regularly Communicating and Listening

The Ritz-Carlton has very thoughtfully embedded transparency into its values and culture. One of the ways this is demonstrated is through consistent and direct communication. Each day, The Ritz-Carlton hotels around the world participate in a Daily Line-Up. All employees—from front-line staff to the Chief Operating Officer—participate in this daily meeting. This gathering not only serves to align employees with The Ritz-Carlton culture, but also provides the opportunity to share news about the hotels and the overall organization. Company information is also shared through newsletters, emails and video.

Beyond these formal channels of communication, senior leaders are accessible and willing to meet with employees, who are known as the Ladies and Gentlemen of The Ritz-Carlton. Hervé Humler, President and Chief Operations Officer, often reminds staff that his door is always open. He believes that “Leaders must walk their talk. They must give from the heart, spend time with their employees, and listen.”

The Ritz-Carlton underscores its commitment to open communication to the Ladies and Gentlemen through Service Value #9. It states: “I am involved in the planning of the work that affects me.” This directive contributes to a culture of transparency by ensuring that the Ladies and Gentlemen participate in decisions and changes. The Employee Promise offers further proof of valuing openness by pledging that, “the principles of trust, honesty, respect, integrity and commitment” will be applied. In addition, all the Ladies and Gentlemen around the globe participate in the annual SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis. By including everyone in this process, The Ritz-Carlton is demonstrating that each employee’s ideas are valued.

Show Me The Numbers

Many organizations struggle to communicate openly about financial information. For competitive reasons, they guard this data. However, this lack of transparency can be detrimental. In the article, “Power of Financial Transparency with Employees,” Eric Holtzclaw shares his company’s experience. He states that “by opening up the books and allowing others more transparency, more people on the team have a deeper understanding of how the company makes and spends money. And because key employees…know the budgets and review them regularly, we have organizational accountability.”

Financial information such as budget numbers and year-to-date revenue are shared regularly at The Ritz-Carlton. Ladies and Gentlemen are aware of financial goals and openly discuss numbers. Not only does this instill accountability, but it also fosters a sense of ownership. Everyone is included, and is therefore responsible for achieving financial success.

Sometimes companies are reluctant to disclose financial information because it is disappointing. No one wants to send out alarming news, but it is important to share important information such as this. Secrets only cause employees to be suspicious and rumors, with potentially wrong information, to circulate. “When you don’t inform your employees, their imaginations go on overdrive,” warns Diana Oreck, Former Vice President of The Ritz-Carlton Leadership Center. She recommends transparency in order to avoid “psychic turbulence” in the workplace.

Millennials Seek Transparent Work Cultures

Ms. Oreck also notes, “transparent leaders—who don’t hoard information and don’t have hidden agendas—inspire and engage employees.” Transparency leads to employee engagement because it fosters trust; allows employees to feel secure and safe; and shows employees how they’re contributing to the company’s mission.

At The Ritz-Carlton, the Ladies and Gentlemen know that “the genuine care and comfort of [their] guests is [their] highest mission.” Everyone has the same purpose, and this means everyone is on the same team—working toward the same goal.

Transparency in the workplace is not simply a passing trend. By 2020, Millennials will be roughly 50% of the USA workforce, and according to the book, “The Millennials” by Thom S. Rainer and Jess W. Rainer, Millennials are “attracted to organizations where the leaders are transparent and open.” Any organization that wants to appeal to the workforce of the future should consider adopting a culture of transparency today. 

The Ritz-Carlton Leadership Center offers advisory services, courses and presentations to organizations that wish to benchmark the award-winning business practices of The Ritz-Carlton. Your organization can learn about The Ritz-Carlton methodology for customer service, employee engagement and leadership development. We also guide organizations through a multi-step process in order to achieve sustainable culture transformation.