I am convinced – absolutely convinced – that the real strength of any company is it’s people. Regardless of what industry your in, you’ve got a competitive advantage if you have bright, hard-working and motivated people working for you.
Here’s what the late Steve Jobs said about having great programmers:
“The difference between the best worker on computer hard-ware and the average may be 2 to 1, if you’re lucky. With automobiles, maybe 2 to 1. But in software, it’s at least 25 to 1. The difference between the average programmer and a great one is at least that. “The secret of my success is that we have gone to exceptional lengths to hire the best people in the world. And when you’re in a field where the dynamic range is 25 to 1, boy, does it pay off.”
According to sales management trainer Philippe Le Baron, the difference between an ‘A’ level salesperson and a ‘B’ level one is 5 to 1! Even as high as 10 to 1!
I know what you’re thinking, But how to attract and retain the best? They’re so hard to find! I’m not Apple!
The answer is by having a powerful culture. So to rephrase my opening sentence, the real strength of any company is it’s culture; that’s your ultimate competitive advantage.
I remember the gregarious Cindy Novotny explaining this during a seminar I attended years ago. She was a Ritz-Carlton trainer at the time, and she said “anyone can copy how a we look. In fact anyone can open a more grandiose hotel than the Ritz-Carlton. They can bring in better mahogany wood, and more impressive crystal chandeliers, but they can’t copy how we operate, and they can’t copy our culture.”
The Ritz-Carlton (with the sad exception of the Gulf branches) is known for it’s legendary service, which is enshrined in it’s powerful culture. It all starts with the employee. If the employee is happy, then he’ll make sure the customer happy. It’s that simple.
I love the Ritz-Carlton credo “We are ladies and gentlemen serving ladies and gentlemen.” That, to me, says it all. Consider the following facts about the Ritz-Carlton:
– It is the only hotel company in history to win the Malcolm Baldrige National Quality Award twice!
– Every Ritz-Carlton employee receives over 100 hours of customer service training annually! How many hours of training do you give over the whole employment period of your employees?
– All employees are empowered to make decisions. They can spend up to $2,000 per day per guest to solve problems! I love it!
– Employee turnover at the Ritz-Carlton is far lower than the industry average (21% vs. 45%) (source Talent Plus), proof that the effort pays off.
Another company that takes culture very seriously is Yum! Brands , owner of KFC, Pizza Hut and Taco Bell. According to an August article in Fortune, Yum is “one of the world’s great financial performers,” whose stock has returned 16.5% compounded annually since it’s spinoff from PepsiCo in 1997 vs. the S&P 500’s 3.9%. Not bad huh?
Yum’s CEO, David Novak, takes investing in people so seriously that he’s created a leadership development programme called Taking People With You. He conducts the programme personally and emphasises things like truthfulness, reliability, openness, and self-centredness.
But Yum! Brands’ culture is not all about seriousness and introspection. They have tons of fun and even have quirky awards like a Rubber Chicken Award and a Walk the Talk Award, which is a set of teeth on legs. I love it!!
David Novak says “If people were asked, ‘What’s our inherent competitive advantage?’, they’d say it’s our culture.” The financial results speak for themselves.
I agree with Mr. Novak’s philosophy. We invest a lot of time and effort in our culture at the DreamBody Centre . We do unique things like have a Falakonian Way plaque that we follow fanatically, give out Brownie Point cheques as a reward to Team Members, conduct an annual two-day event called the Big Bang (see video below), and just have tons of fun while helping people change their lives to the better!
Several of our Team Members have been made offers to work in other places with higher pay, but have refused to leave. They just love working here too much!
Having a powerful culture really is your ultimate competitive advantage.