Significant Stat: Bad Reputation

A bad reputation costs a company at least 10% more per hire (source)

Advice from Jeff Hargett, Senior Corporate Director, Culture Transformation at The Ritz-Carlton Leadership Center:

Where do you find the “right” people? If I’ve heard that question once, I’ve heard it a thousand times. A large part, if not the majority, of a company’s success in sustainable service excellence comes from “the people.” If the culture (synonymous with the reputation) of a company is seen as negative and nonsupportive of its employees or disengaged, then fewer and fewer people will want to work there, causing the company to spend more to attract potential staff, even just the “warm body” variety. When a culture of excellence is evident and promoted, the fountain of potential superstar employees flows to you rather than you having to fund job fair after job fair just to meet your minimum FTE requirements. One of the best recruiting tools and cost-cutting measures is an army of fully engaged employees!  

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.

Culture and Onboarding

“Culture drives everything that happens in an organization each day,” according to the book The Culture Engine. Everything. Each day. That’s how important culture is to your organization, and this is why immersing new employees into your culture is of paramount importance. Immerse may seem like a strong word, but think of it like visiting a new country. You need to know as soon as possible whether you drive on the left or the right, whether or not you can drink the water and whether shaking someone’s hand is courteous or offensive. Likewise, new employees should learn about your organization’s customs as soon as possible– culture and onboarding have a symbiotic relationship. They need to understand your organization’s values and goals, general rules of operation and common language and behaviors. Adapting to an organization’s culture does not take place overnight. At The Ritz-Carlton, we understand that new employees go through three phases before they completely embrace the culture.

Phase One – See It

One of the ways your new hires will begin to learn about your culture is from observing their physical surroundings. What people wear to work, how colleagues set up and decorate their offices and whether your company’s vision, mission and values are visible will tell new employees a few things about your organization. At The Ritz-Carlton, the Credo and The Employee Promise are displayed in common areas and in each office. In addition, all employees—known as our Ladies and Gentlemen—have a pyramid on their desk that shows the annual goals, vision, mission, motto and other key cornerstones.

New staff members can also be introduced to your culture by reading a company brochure or new hire manual. They may also hear about company culture from managers or co-workers. New hires at The Ritz-Carlton spend the majority of their two-day onboarding learning about our company’s culture. The new staff is introduced to the culture through videos, presentations by managers and group discussions. All new hires are required to memorize and recite the Credo before completing orientation.

Phase Two – Believe It

After your new employees learn about your culture they may still be skeptical about its relevance. Your new hires may be jaded by past experiences where organizations have claimed something is important, but there is no follow-through. For example, colleges often tell incoming students that refrigerators are not allowed in dorm rooms, and yet, many students have mini-fridges. Rules that aren’t enforced have no meaning. Your new employees need to know that your organizational values are not just posters on a wall or words in a welcome booklet. As new hires experience your culture and see that it is truly lived within your organization, they will begin to trust and accept your culture.

At The Ritz-Carlton, the culture is enlivened at Daily Line-Up. Every day the Daily Line-Up focuses on one aspect of our Gold Standards, and new employees hear how their managers and co-workers are applying the culture. Often the person leading Line-Up shares a personal example of how he or she has demonstrated or witnessed this Gold Standard being expressed. Hearing how colleagues are living the culture not only indicates its validity, but also inspires new hires to do likewise.

Phase Three – Live It

After your employees see the culture and witness how it is embraced, they will begin to live the culture as well. It’s important for your organization that all employees are adopting your culture. Going back to the book The Culture Engine, the author points out that “Defining values and behaviors and then holding everyone in the company or team accountable for living them creates continuity and sanity. Every player knows what’s expected of him or her.” When all of your employees are living your culture, your organization is more unified and therefore, capable of achieving more.

Phase Out – Leave it

Employees that choose not to embrace your culture, most likely, won’t last long at your organization. Hopefully, new hires will recognize that they are not a right fit and will move along on their own accord. If not, your organization may face the task of encouraging people to find other employment. Some organizations even offer new hires “pay to quit” programs in order to incentivize employees who are not a right cultural fit to leave the organization. Offering a “payout” like that may seem extreme, but when employees are happy, engaged and committed to their work and the organization, isn’t it better for all? Employees who embrace your culture will contribute to an atmosphere of teamwork, collaboration and greater success. 

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.

Significant Stat: Culture and Engagement

87% of organizations cite culture and engagement as one of their top challenges, and 50% call the problem “very important.” (source)

Advice from Diana Oreck, Former Vice President of The Ritz-Carlton Leadership Center:

If you really want your organizational culture to be embraced consistently, the following should be non-negotiable: Every employee in your organization, regardless of role, should be able to articulate the culture. A well-articulated culture establishes a framework and foundation for expectations, accountability and engagement. At The Ritz-Carlton, the Gold Standards encompass the values and philosophy by which we operate. All of our employees—also known as our Ladies and Gentlemen—review the Gold Standards at Daily Line-Up and apply them throughout the day. When your culture is enlivened daily, this ensures everyone is marching in the same direction toward success. 

Join us for a one-day symposium, “Your Journey to Service Excellence.” The day includes a keynote speaker, a Q&A session with The Ritz-Carlton executive panel, an optional networking reception and presentations about legendary service, employee engagement and developing a customer-centric culture.

Inspired Thinking: Customer Service Culture

“You’ll never have a product or price advantage again. They can be easily duplicated, but a strong customer service culture can’t be copied.” — Jerry Fritz, Speaker

The Ritz-Carlton Leadership Center:

A low price may encourage a customer to do business with you, but most likely, it will not build customer loyalty. Customers can find which company is offering the lowest price on a product within seconds, and most consumers will shop around. When you focus on your customer experience rather than on price, you have a better chance of building loyalty and differentiating your organization from the competition. Creating an engaging customer experience takes more than a color change or technological upgrade. Most organizations known for customer service such as Nordstrom and Amazon have a customer-centric culture. The Ritz-Carlton was designed around Gold Standards—the Motto, Credo and Service Values—that ensure our customer is always the top priority. Every organization is capable of separating itself from the competition with a culture of service excellence. What are some steps your organization can take to make your culture more customer- or patient-centric?

Dear Ritz-Carlton: Collaborative Culture of Innovation?

Dear Ritz-Carlton: Many companies have innovation on their checklist. How does The Ritz-Carlton best leverage this concept?

Answer from Jennifer Blackmon, Corporate Director, Culture Transformation at The Ritz-Carlton Leadership Center:

speaker_jenniferblackmon

Innovation is at the core of The Ritz-Carlton culture. We understand that the best ideas and concepts for change will come directly from the individuals who are actually doing the work and that is why we foster a collaborative culture of innovation. There must be a process in order to nurture ideas, and leadership has to champion it. When a team member has an idea, how do they share it? What happens to it? Who will follow up on it? These are the questions every organization should be able to answer. If employees go out of their way to share ideas and all they ever hear in return is the sound of crickets—it won’t be long before they stop trying. Every organization has some extremely creative employees. Recognize and nurture their talent and give them the opportunity to see an idea through. When managed correctly, innovation will positively affect the bottom line, the customer experience and create employees who are passionate about the company.

Join us for a one-day symposium, “Your Journey to Service Excellence.” The day includes a keynote speaker, a Q&A session with The Ritz-Carlton executive panel, an optional networking reception and presentations about legendary service, employee engagement and developing a customer-centric culture.

Our Ladies and Gentlemen: Leeny Oberg

Leeny-ObergHeadShotEach month, The Ritz-Carlton Leadership Center (RCLC) features an interview with an employee — a Lady or Gentleman of The Ritz-Carlton — in order to share an insider’s view of the organization. This month’s interview is with Leeny Oberg, Chief Financial Officer (CFO) at The Ritz-Carlton Hotel Company, L.L.C.

RCLC: As a financial expert, you’ve worked for a variety of institutions such as Sallie Mae and Chase Manhattan Bank. What attracted you to the hotel industry?

Ms. Oberg: In my first two jobs, I advised companies to help drive them toward a successful business strategy which ultimately had to work for customers and employees in addition to succeeding financially. However, in the long run I saw myself as being part of one team rather than being an advisor to a number of companies. So the whole idea of working with a lot of people—being in a business driven by people, serving them, building their careers through apprenticeship—was stimulating for me. Also, I found the culture at Marriott and The Ritz-Carlton, to be a good fit with me personally. I’ll always like finance, but The Ritz-Carlton culture fits my values.

RCLC: What most impressed you about the Marriott and The Ritz-Carlton philosophy?

Ms. Oberg: Wall Street has a culture all its own. When I worked in banking, I saw CEO and CFO types who knew all the answers and told everyone else what to do. It was within the first five minutes of meeting Bill Marriott that I distinctly remember saying to myself, “This is so different.” He kept asking questions like, “What are you interested in?” and “What are you bringing to the table that can support our growth?” In effect, he said, “I don’t have all the answers.” There is such mutual respect across all levels of the organization.

RCLC: Your bio describes your job as “aligning the finance function with the brand’s vision.” How do you boil that down in day-to-day activity?

Ms. Oberg: I focus on three components:

  • The Ladies and Gentlemen who work at The Ritz-Carlton Hotels.
  • The customers, because without them, what are we?
  • The owners, who expect a return on their investment.

Unless I‘m spinning and balancing all of those “plates,” we aren’t going to be a leader in the industry.

RCLC: Why do you think The Ritz-Carlton Hotels are so successful?

Ms. Oberg: At the end of the day our Credo—a statement defining our mission—drives the behavior of our employees and puts our principles to work. When the Credo is consistently emphasized by a General Manager to their team, it becomes a guiding star and employees use it to respond in any given situation. To have that done globally, drives success.

I’m a huge believer in Line-up meetings, where department heads meet with their team to prepare for the day. They prompt thought, everyone learns something new, and it’s an excellent time to review the Credo. It keeps our principles top-of-mind and gets everyone on the same page so we can put the Credo into action.

RCLC: Do you ever “mystery shop” at your hotels?

Ms. Oberg: Through our customer knowledge system, I’m recognizable at our hotels. So I mystery shop at our competitors, and our competitors are good. I let employees know how well we are doing but that there are other luxury hotel companies out there doing well, too. I come back from a competitor and talk about my experience at our Line-up meetings. What stands out to me is how we deliver service. My favorite word in The Ritz-Carlton Credo is “genuine.” To me, when you provide service that is genuine versus service that is laissez-faire, that’s a huge differentiator. We can’t overplay the need for our service to be delivered sincerely.

RCLC: What do you appreciate about working for The Ritz-Carlton?

Ms. Oberg: The fact that the culture is built into the whole company. I can look to a Ritz-Carlton parking valet for business acumen and learn what’s going on at the hotel. Granted, I get different information from him than from the finance director, but both are just as valuable. To me, that’s phenomenal and I cherish it. 

Ms. Leeny Oberg will be a member of The Ritz-Carlton Executive Panel at the Symposium: Your Journey to Service Excellence on Thursday, November 12, at The Ritz-Carlton, Tysons Corner in McLean, VA.

Addressing Organizational Culture

Remember when you were in college and you found a course that you were dying to take, but you had to meet the prerequisites? Perhaps you wanted to learn more about one specific artist, but you had to take introduction to art history first. Or you were interested in advanced marketing but had to take a general business course first. It may have felt counter intuitive to take an introductory course when what you really wanted was a deeper dive. However, curriculum is developed to give students a solid foundation before pursuing more in-depth learning.

Businesses and healthcare organizations need to meet similar prerequisites. Your organization may be interested in empowering employees or offering better customer service or patient experience. However, before you can focus on these in-depth topics, you need to make sure your organization has a solid foundation—a well-developed, enlivened culture, which everyone in the organization regardless of role can articulate.

Tackling culture may seem like a daunting task. And let’s be honest. We’re a society that values efficiency and shortcuts. We like convenience, quick fixes and immediate results, and addressing organizational culture sounds like it could be a long process. If your goal is simply to improve service, why do you have to begin with organizational culture? Because culture is the foundation of your organization. If you try to make changes without establishing your culture first, it’s likely those change efforts will fail.

Think about it like buying a new home. If your home inspection indicated a faulty foundation, would you reconsider your purchase? Or would you move forward with your decorating plans—knowing that your home is not stable? While some defects may not seem hazardous to your overall structure, one construction expert warns that, “any mistakes you make in the foundation will only get worse as you go up. It’s known as compounding defects and it means that mistakes grow.”

When foundational mistakes filter up throughout your organization, you can only truly solve these challenges by addressing them at a foundation level—through your culture. A strong culture creates unity, consistency and provides the framework for sustainable change.

Establishing A Unified Organization

The Ritz-Carlton is able to offer legendary service because of the attention given to culture. The Gold Standards—the Credo, Motto, Three Steps of Service, Service Values and Employee Promise—are the bedrock of The Ritz-Carlton. Each employee of The Ritz-Carlton—known as Ladies and Gentlemen—carries a Credo card of the Gold Standards, and before completing orientation, every new employee must memorize the Credo. The first sentence of the Credo is: “The Ritz-Carlton is a place where the genuine care and comfort of our guests is our highest mission.” Notice that it says “our mission.” We all have the same mission—from the president to the front desk agents to the sous chefs. We are working together to serve our guests.

Cultivating Consistency

The Ladies and Gentlemen at every Ritz-Carlton around the world participate in Daily Line-Up, a brief meeting. Each day one facet of the Gold Standards is highlighted and enlivened. By reinforcing the culture, the Ladies and Gentlemen of The Ritz-Carlton are continually reminded of the importance of living the Gold Standards. This repetition also helps ensure consistency.

While the Credo serves as a collective precept, the 12 Service Values outline how each person is individually responsible for the Gold Standards. For example, the 6th Service Value states: “I own and immediately resolve guest problems.” Each Service Value begins with “I,” and this first-person approach instills accountability and directs the actions of our Ladies and Gentlemen.

Ensuring Sustainability

Because the culture of The Ritz-Carlton is so well-articulated, it is possible to make changes to the organization without disturbing the overall integrity of the operation. The Daily Line-Up provides a communication channel to roll out any new initiatives and quickly incorporate them into the current culture. A strong culture also means that the business model can be replicated in new locations. So if you visit a Ritz-Carlton Hotel in China, it should have the same dedication to service as a Ritz-Carlton Hotel in Florida.

Addressing Organizational Culture

Whether your organization wants to increase employee engagement, enhance your customer service or empower your employees, you should begin with a cultural assessment. You may be tempted to skip this prerequisite. However, when you invest your time and energy into cultivating and maintaining a healthy organizational culture, your organization will experience long-term benefits. 

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. 

Inspired Thinking: Peer Accountability

“If you are building a culture where honest expectations are communicated and peer accountability is the norm, then the group will address poor performance and attitudes.” — Dr. Henry Cloudclinical psychologist and author

The Ritz-Carlton Leadership Center:

We are starting to see companies develop open communication cultures that facilitate honest and transparent dialogue between departments, teams and co-workers. Teams are more successful when each member understands his or her individual contributions and how those contributions impact the end result. This ensures that the team understands interdependencies and the effect of poor performance on their co-workers. As leaders, we expect honesty and accountability throughout the entire organization. The Ritz-Carlton maintains a culture of accountability through empowerment and trust. Our Ladies and Gentlemen know they can give candid yet respectful feedback. When complacency creeps into our routine, we quickly identify it, and we work together to make the necessary changes. How are you encouraging your team to be accountable to one another? 

Inspired Thinking: Work Environment

“We begin to see, therefore, the importance of selecting our environment with the greatest of care, because environment is the mental feeding ground out of which the food that goes into our minds is extracted.” — Napoleon Hillauthor

The Ritz-Carlton Leadership Center:

If you want your organization to consistently provide legendary service, you must ensure that your work environment, your foundation, your culture is designed to support an atmosphere of service. When you establish and enliven an environment that prioritizes service, your employees will naturally prioritize service as well. The Ritz-Carlton culture springs from our Gold Standards, and these standards are our “mental feeding grounds.” They remind employees that “the genuine care and comfort of our guests is our highest mission.”

Giving your employees customer service tips and tricks without creating a culture of service is like building a house without a foundation. It might work for a while, but when there’s bad weather, the home will collapse around you. You want to build an organization that maintains its values through all circumstances—and offers stability and consistency to your employees and your customers/patients. Being able to provide an environment that is supportive, engaging and passionate gives your staff the ability to have the mental preparedness they will need when doing their job. 

Our Ladies and Gentlemen: Sue Stephenson

Sue StephensonEach month, The Ritz-Carlton Leadership Center (RCLC) features an interview with an employee — a Lady or Gentleman of The Ritz-Carlton — in order to share an insider’s view of the organization. This month’s interview is with Sue Stephenson (@RitzCarltonCSR), Vice President of Community Footprints. Community Footprints® is The Ritz-Carlton social and environmental responsibility program, focused on benefiting the communities where the company operates.

RCLC: What is your role as the Vice President of Community Footprints?
Ms. Stephenson: As the Vice President of Community Footprints and a direct report to our company’s President and Chief Operations Officer (COO), I lead the development of our Community Footprints global strategy. With operations in Asia Pacific, the Middle East, Europe and the Americas, our approach is to merge our global strategy with local execution and perspectives. This ensures our employees’ volunteer efforts are relevant, impactful and can be adapted to meet local pressing needs.
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RCLC: Was there a moment in your career when the idea of social responsibility clicked for you or was it a slower, less obvious process?
Ms. Stephenson: I’ve worked for The Ritz-Carlton for 24 years, and it’s been an organic process. A commitment to the community and environment was embedded in our mission statement when our company was founded with a statement that “The Ritz-Carlton Hotels will be positive, supportive members of their communities and sensitive to the environment.” Our philosophy of service translates into reaching out to others, beyond the walls of the hotels, and I’ve been fortunate to play a role in evolving that commitment into Community Footprints—which is now one of the strategic pathways of The Ritz-Carlton Long Range Plan.

RCLC: How does Community Footprints fit into The Ritz-Carlton culture?
Ms. Stephenson: Community Footprints is woven into the Gold Standards of The Ritz-Carlton through Service Value 4: “I understand my role in … embracing Community Footprints …” Every employee acts on our Service Values so it’s a natural process for our Ladies and Gentlemen to want to be engaged in projects that support their local community. Community Footprints provides a platform for our employees around the world to play a role in tackling serious community issues. They don’t see it as a corporate program, they see it as their program. They make it work and are tremendously proud of their efforts.

RCLC: How do you determine which projects to take on?
Ms. Stephenson: Our initiatives are multifaceted and focus on child well-being, hunger and poverty relief, and environmental responsibility. At every Ritz-Carlton hotel, club and residence around the world we have a Community Footprints Team and at the beginning of each year they plan out how they will support their community and submit a comprehensive Community Footprints Annual Plan. The report details scope and frequency of all planned volunteering and fundraising activities for the year and an overview of their Community Footprints local non-governmental organization (NGO) and community partners. Targets are set for our properties with the results integrated into our company’s Business Priority Metrics and leadership performance measures. We are proud of our year-over-year improvements with, as an example, over 150,000 hours contributed to our Community Partners in 2014 and $5.6 million in cash and in-kind donations.

RCLC: Are there any brand-wide programs that all your hotels participate in?
Ms. Stephenson: Yes. Our Succeed Through Service mentoring program is deployed in over 100 middle and high schools in low-income communities around the world and is designed to make a positive impact on young people. The curriculum brings students to our hotels and takes our Ladies and Gentlemen into classrooms to teach critical career and life skills and introduces the idea of students contributing to their own communities. Since the 2009 launch, we have worked with over 18,000 middle and high school students across the U.S. and around the world. To encourage others to get engaged in helping students flourish, we’ve made our Succeed Through Service materials available on an open-source non-proprietary basis.

RCLC: Can you give us examples of individual projects going on in local communities?
Ms. Stephenson: One of my favorite aspects of my role is that every day I receive images of the Community Footprints projects that are happening in different parts of the world. One example of the multitude of programs taking place to help children flourish occurs weekly at The Ritz-Carlton, Grand Cayman, where, in addition to many other Community Footprints activities, 20 employees volunteer in the John A. Cumber School Reading Buddies Program. Last year they contributed 1,963 volunteer hours reading to the young students.

In the area of hunger and poverty relief, we provide skills training, make food and supply donations and provide volunteer support. As an example, for over six years our employees at The Ritz-Carlton, Denver have been cooking and serving meals on a monthly basis at Urban Park, an organization that helps homeless youth reach their potential and achieve a successful life.

In the area of environmental responsibility, we focus on reducing our carbon footprint and protecting the environment. A local example is taking place at The Ritz-Carlton, Dubai International Financial Center where the employees are planting and helping conserve the Ghaf tree, a rare desert plant species of culture and ecological significance.

RCLC: How is Community Footprints evolving?
Ms. Stephenson: We’re broadening our volunteer focus to have more of a skills-based focus. We challenge ourselves to ask, “If I am contributing two hours of my time, how can I incorporate any of my business skills into that work?” For example, our chefs could help to plant trees in a local park but what’s even more beneficial is if they help a local hunger relief organization plan well-balanced, cost-efficient and nutritious meals. With this skills-based approach, our Public Relations teams help nonprofits develop their social media strategy; our Human Resources teams teach interview skills at community centers; while our front desk staffs teach social skills to members of the community re-entering the workplace. The possibilities are endless. There’s a reward when you help beyond what your muscles can do — you then engage your mind and heart and those skills are invaluable to a nonprofit or NGO!

RCLC: Are there any recently launched initiatives?
Ms. Stephenson: Yes! Just last December at the United Nations, Herve Humler, our President and COO and I participated in the introduction of IMPACT 2030, a global collaboration between the U.N. and the private sector. The Ritz-Carlton Hotel Company is the first Founding Partner of IMPACT 2030: The Global Initiative for the Advancement of Corporate Volunteering. We are partnering with many global companies, including IBM, Google and Tata Consulting Services, to launch the program in September 2015. IMPACT 2030 will help corporations leverage their volunteer programs to advance the United Nations Sustainable Development Goals. We’re all very excited about the possibilities of this global program that will help address the most critical issues for our planet and bring about global change.

RCLC: If you could capsulize Ritz-Carlton’s social responsibility efforts, how would it read?
Ms. Stephenson: Our Community Footprints Mission Statement says it best. “At The Ritz-Carlton we have built a legacy of extraordinary service. This tradition extends into our Community Footprints program and inspires us to positively impact the lives of others. Every contribution we make is an opportunity to leave an imprint on our community. It is through this collection of imprints that we can make a meaningful difference.”

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.