It is Christmas Eve and I am sitting in the bar at the Ritz Dove Mountain Resort in Tucson reflecting upon the past year and enjoying the holiday season. Ritz is an amazing company and its employees are among the best in the industry. Their business goal is simple and well ingrained in each employee – to ensure the care and comfort of their guests.
ImpaQ Solutions has been fortunate to work with many businesses. We have yet to meet a business owner who was not full of optimism, enthusiasm, and confidence in the future. What they lack in experience is more than made-up for by their energy and desire to succeed. However, there are three traits described below that clearly determines the degree of their success, i.e., whether the business grows and how fast.
An owner’s lack of willingness to let go may be the single most important growth limiter that we see repeatedly. Owners often make themselves the single chokepoint that inhibits growth. Whether it is by micromanaging finances, hiring decisions, technical solutions, or another area of the business, owners who fall into this trap fail to concentrate on their most important jobs – developing business, keeping customers happy, and delivering quality products. Owners who concentrate on the little things to the detriment of the big things create a culture of mistrust that ultimately becomes demotivating.
Every Ritz-Carlton employee is exceptionally well trained, and their superiors have given them both the responsibility and authority to do their job. For example, any employee can do whatever necessary, even if it involves spending money, to independently make the guest happy without seeking permission. The Ritz has a clearly defined mission statement and credo, and all of its employees are empowered to be successful.
We continue to see a correlation between company growth and the ability of the owner/leadership team to learn and adapt. I have always been a proponent of lifelong learning regardless of whether the individual is in a technical, operational, managerial, or executive role. Business owners who hang on to the same old way of doing things and viewing their businesses become stagnant. We observe the most successful businesses as those that develop their leaders, including themselves, as well as their employees. Today’s economy demands companies that are adaptive and agile. Those companies that don’t focus on lifelong learning and development have shortened lifecycles. The Ritz has an extensive and impressive commitment to learning and adapting. It is obvious from talking to many employees that no one there ever thinks “I know all I need to know”. Training and development is an ongoing process.
Realizing that employees have power and are the most valuable resource of a small business is especially important. This one is closely associated with the first trait, but has a slightly different bent. Many years ago while an Executive Fellow at the Harvard Kennedy School I took a course on organizational power. It became clear that positional power in an organization was far less effective, and shorter lived, than employee power. Creating a culture where employees feel empowered and obligated to do their jobs is far more effective than one where tasks are only competed out of a sense of obligation and/or fear. An executive can bark orders but each employee controls the degree and quality of fulfilling commands.
The Ritz measures employee and customer engagement scores as a single measure, with this metric considered as important an assessment tool as their financial data. Data from Gallup research reinforces that employee engagement is directly related to financial results – companies that score above the 50th percentile on either employee or customer engagement tend to deliver 70% higher financial results. However, companies that score about the 50th percentile on both employee and customer engagement measures outperform by 240%
“Ladies and Gentlemen serving ladies and gentlemen” – this is the Ritz’ motto. Treat your employees as you treat your customers. Ensure you, your leadership team and the entire company keeps learning. Empower your employees to do what is necessary to meet your company’s mission. These are key to ensuring long-term success.
Click here for more information on the Ritz’ mission, credo. Business of all sizes and types may find it very helpful.
What have you found to be the keys to your business\’ growth… and obstacles that are holding you back?
The point about owners concentrating on the little things at the expense of big things (aka, micro-management) is spot-on and something I’ve experienced personally, particularly in smaller companies. There seems to be an inflection point at which owners of small organizations need to make a conscious decision to “let go.” If they do it too soon, they lose momentum (because they are too small to effectively delegate leadership). If they do it too late, they kill momentum.