Author: Scott Hays

Unless you’re one of those rare human resources virtuosos who has a natural talent for teaching, it won’t be easy designing and implementing a workplace literacy program—especially one that will help employees improve the skills needed to retain their jobs, advance their careers and increase company productivity.

A successful workplace literacy program requires a lot more than just stuffing paycheck envelopes with Project Read® brochures. Most HR managers, all too aware of their limited expertise in this area, choose alliances with local educational institutions, community colleges or even private firms skilled in developing, customizing and delivering basic workplace skills programs. It’s just easier than trying to build something from scratch.

Be sensitive in your approach to skills assessment.
Developing a more highly skilled workforce first requires a job analysis and skills assessment to help you identify and close the gaps in reading, math, communication skills and other areas. The City of Phoenix, for example, conducted a survey over a decade ago that revealed many employees lacked the basic skills to be considered “promotable.” As a result, the Public Works and Personnel Departments partnered with local community colleges and Literacy Volunteers of Maricopa County to develop a curriculum for city employees. “It’s just more feasible to work with outside consultants who already have the assessment and training tools,” says June Liggins, Phoenix personnel curriculum and training coordinator.

However, assessing employees can often lead to stress. Sometimes people think they’re at a higher reading or math level than they really are. Most managers agree the curriculum should be tied as closely as possible to workers’ skills and what workers actually do.

You should also encourage employees to transfer their newly acquired skills back to the workforce to improve, say, cycle times or marketing, or to increase employee bonuses. Above all else, consider that maybe you’re better off relying on professional instructors than the do-it-yourself approach.

Employee reluctance must be overcome.
Perhaps the toughest hurdle to overcome is getting people to volunteer for a literacy program. “Employees are just too self-conscious,” says Jack Fenimore, president of the Newburgh, Indiana-based Literacy Now, a nonprofit distributor of educational materials. “They don’t want to admit they can’t read, particularly to their employers.”

Years ago at Schaumburg, Illinois-based Motorola—when company officials first introduced a workplace literacy program—employees were given the opportunity to volunteer if they felt they needed to improve their reading, writing and math skills. Less than half stepped forward. “But once employees went back into the workforce and started sharing their experiences, the participation rate jumped another 20 to 30 percent,” says Jim Frasier, manager of learning research and evaluation for Motorola University.

Companies that really want to encourage employees to get involved in their own education need to convey straight from the CEO’s office that it’s a business issue that’s driving the need for skills improvements. Once that’s established, managers should consider a range of programs that are both innovative and expansive, not only for your existing workforce, but for alternative labor pools, as well.

There are ways to keep the training costs low.
Although the Washington, D.C.-based Manufacturing Institute’s Center for Workforce Success recommends employers invest at least 3 percent of total payroll to educate and train employees, workplace literacy programs don’t have to be expensive. For many small and mid-size companies, there’s little expense beyond the time involved in planning the program and releasing employees from work to participate in classes. For example, the cost of the Phoenix Literacy Program has averaged about $2.25 per employee-contact hour, according to city officials.

There are many ways to keep the costs of your basic skills programs low, according to Washington, D.C.-based National Alliance of Business (NAB). Some states offer tax credits, some unions share expenses, and federal and many state governments offer grants.

It’s not even necessary to conduct classes only at corporate headquarters. Collaboration is actually a good thing for effective training and education, and, in truth, no single company, educational institution or government agency can tackle the challenge alone. “Companies need to sit down with educational institutions and others, and decide what specific skills are needed in the workforce,” says Helene F. Uhlfelder, Ph.D., director with the Atlanta office of AnswerThink Consulting Group, a management consulting firm.

HR managers need to consider these key points.
Workplace literacy training must meet not only your company needs, but also the needs of your employees—otherwise, they may not participate. According to NAB, there are a number of key points you should consider when developing a workplace literacy training program.

• Involve management, supervisors, employees and union in the development stage. Successful programs should be supported by every department in your company.
• Align the program with company objectives, practices and job requirements.
• Whenever possible, workplace literacy skills training should be linked with other training required in the workplace.
• Be flexible about when and where classes are held, and provide incentives for participating employees.
• Allow for self-paced learning. Employees will come to the training with widely divergent skills and learning abilities.
• Use a variety of instructional methods and media, from self-paced computer programs and workbooks to one-on-one instruction.
• Provide ongoing feedback to help employees gauge their own progress.
• Ensure employee confidentiality. Otherwise, they may not participate.

To get training off the ground, you need support.
Diane Bronson Young is CEO and human resources director of Ridgeville, Ontario-based J.F. Young International Inc., an educational training and consulting firm. She has more than 15 years of experience in literacy training, and works primarily with companies interested in setting up educational upgrading programs for their employees.

“The two most important elements when establishing a company literacy program are support from management and confidentiality,” she says. “If you don’t have support from management, the program will end up a failure. Management must believe a literacy program is important for employees and the company. And guaranteeing confidentiality helps encourage employees to get involved.”

According to NAB, basic skills programs have increased productivity, reduced errors and improved sales and on-time delivery at various companies around the country. Of course, the key to solving the lack of basic skills in the workforce is what happens after class adjourns. Training is not a one-shot deal. It took Motorola eight years to complete basic skills training for 8,000 of its production workers. The City of Phoenix continues to educate its employees. And if you believe the research that as much as 20 percent of the American workforce may still be functionally illiterate, then you’ve got to believe implementing a workplace literacy program is a must—no matter how long it takes.

Workforce, April 1999, Vol. 78, No. 4, pp. 76-78.

Before you send employees on international assignments—or even short business excursions—make sure they understand the basic challenges that face anyone traveling to a foreign country.

As many human resources professionals already know, international business travel can be an extremely stressful situation—long hours on an airplane, language differences, currency exchange issues, the logistical nightmare of just finding your destination. Imagine if you’re a less seasoned traveler with no experience in the country you’re visiting. Traveling to a new land just adds to the sense of fatigue of a new assignment—your employees are already stressed, going through different time zones, eating different foods.

Hopefully, you’ve already encouraged your employees to read some travelers’ guides and take time to educate themselves about their new destination. While they’re learning about the country they’ll be visiting, they should also be prepared to know the nuts and bolts of international business travel, safety and health issues.

First and foremost, make sure you obtain the proper documentation to ensure that your employees pass all customs, immigration and visa requirements. In some countries, it can take up to three months or longer just to obtain employment authorization. The visa applications should be one of your first steps in the process. Don’t dillydally and wait until just before your employee’s supposed to leave for his or her new assignment to start worrying about paperwork.

Once that’s behind you, walk your employees through the various travel arrangements, and the health and safety issues upon arrival. Arriving in any destination is a challenge—made even more difficult if you’re traveling to a different country with an entirely different culture. Your company should develop strategies that’ll make the lives of your employees on the road a lot more enjoyable, and eventually more profitable.

Here are tips for you and your travelers.

• Always pack small packages of food to carry aboard the airplane. Also, call the airline in advance to ask for special meals, if necessary.
• It’s a good idea to carry a list of the items your luggage contains in case something is lost or stolen during your trip.
• Decide whether to buy foreign currency before you leave the U.S. or after you arrive. Take some money in local currency for arrival expenses such as tipping and taxi rides. Take the rest of your money in travelers’ checks.
• Think about obtaining health, travel and accident insurance coverage—better safe than sorry. Also, be sure to obtain information on medical, legal and professional services, and how to obtain those services in an emergency.
• Always carry extra copies of your passport photo. They come in handy when you’ve lost your passport or even for an international driver’s permit.
• Stock up on business cards before you leave.

• Before your trip, study the health and safety conditions of the country in which you’ll be staying. This research should include current political conditions, weather, common wildlife, even the crime rate.
• Leave valuable items at home, including jewelry, cellular phones and unnecessary credit cards.
• Master the local currency before you do anything that puts your fortune on the line.
• Ask for an up-to-date map when you arrive in a city and take a reconnaissance walk to get familiar with the city’s feel and your neighborhood. If you’re in a non-English speaking country, jot down the hotel’s name and address.
• Learn a few key phrases in the host country’s language.
• Learn about the values of a country, and be aware of how you will fit into that culture in every aspect of your behavior.
• Register with the U.S. consulate. It will facilitate help if you have an emergency. If you’re working in a country with no U.S. officials, register in an adjacent country, if possible, leaving your itinerary.
• Find out how the local telephone works. Make a list of addresses and telephone numbers of any local contracts you have—the police, hospitals, consulate.
• If you’re arrested, ask permission to notify the U.S. consulate.

• Some countries require the employee and all family members undergo medical examination as part of the process. Make an appointment with your physician and make sure you’re caught up on all of your vaccinations. Educate yourself about health risks in the country you’re visiting. Immunize yourself to those diseases found in that country.
• Take copies of all your eyeglass and medical prescriptions, blood type, and so on. Take extra prescription drugs in original containers, and check with that country’s laws to see if those drugs are permissible to bring into the country. Take extra eyeglasses or contact lenses.
• Remember that the cost of medical evacuation of a sick or injured person is extremely high. A company may have to spend $30,000 to airlift the person to another country that has a medical center or back to the United States, so don’t fudge when it comes to your health.

“Moving to another country is a difficult transition,” says Jeff Davidson, frequent traveler and author of The Joy of Simply Living (Rodale Press, 1999). “In fact, most people are sorely underprepared for it. They have no idea how cut off from their formal world they’re going to feel. If nothing else, make sure you have e-mail access to everyone who counts. It’s a relatively inexpensive way to stay in touch, no matter where you are. Also, every country and city has a Web site that you can visit in advance; print out the pages that matter to you. Many Web sites even have global map capabilities.”

Any company with expatriates should always establish an immigration and travel policy—a handbook, if you will—to help manage your employees’ anxieties and expectations. It will not only go to alleviating a lot of stress, but it can also save you on legal fees and help streamline the entire process. In other words, don’t let the experience ruin your employee’s stay. After all, you never get a second chance to make a first impression.

Workforce spoke with Tom Nides, senior vice president of human resources, about Fannie Mae’s work/life initiatives for employees, and its outreach programs for the community. The highlights:

Do you feel people actually come to work for Fannie Mae because of its work/life initiatives and its outreach programs?
It’s a combination of those things, yes. But everything flows from our corporate mission statement to put low- and moderate-income people in houses. We’re also practical in our understanding that every individual employee has his or her own needs, and we have a reputation in Corporate America for addressing those needs. Consequently, when people come to us for jobs, the first thing they ask about is our benefits programs. We try to provide the whole smorgasbord of benefits for our employees, and also to use those programs as recruiting tools to bring new employees into the company.

Why all this time, money and effort on corporate social responsibility when employee loyalty is tenuous, at best?
Our turnover is well below 10 percent, which is terrific for a financial service company. We don’t buy into the proposition that employees aren’t loyal. People want roots; they want to feel a part of a company. If you can give them a reason to stay, they’ll stay. People leave all the time, sure, but we find good business for us is keeping our employees here. We spend thousands and thousands of dollars training each and every employee for the sole purpose to keep them here. The longer they’re here, the more they understand the company and that makes for a better employee, and ultimately a better company.

You grant 10 hours paid leave per month for volunteer work. How has this impacted the company’s bottom line?
It’s had no measurable impact on revenues, but then I would argue it’s hard to measure these things. On the other hand, we’ve been pleasantly surprised by how well these programs are received by our employees. We’ve probably had upwards of 30 percent employee participation, and we’ve just come off a phenomenal year.

Why is it important that employees balance their work and home lives?
For instance, if employees know their company is willing to help them when there’s a family health-care crisis, then they’ll want to come to work and they’ll stay focused on their work. A lot of our employees have children, and they think it’s terrific that we encourage them to volunteer at their children’s schools. We want our employees to know they need to balance work and family because if they’re not happy at home, they won’t be happy at work.

Do you believe the profitability and viability of a company depends on its ability to gain the confidence, support and trust of its employees and their families, as well as the community?
It’s our number one issue. If you don’t have the loyalty of your employees, then you have a company that’s not on the cutting edge. Our employees like to come here. We have a company that’s relatively small by number, but large in capital. Consequently, we need to count on a small number of people to do an enormous amount of work. We want them motivated and fired up to come to work.

Have you been able to track a link between your efforts to be a neighbor to the community and enhanced employee productivity?
This isn’t a complete science, but we survey our employees every 18 months. We really care about what they think. We’ve tried to find out what motivates them. This much is clear: The things we do for the community as they relate to our corporate mission—building houses, getting involved in volunteer programs—are very much part of what people respond to at Fannie Mae. To me, our employees believe this company is committed to our programs in the communities and that makes them feel better. We believe our employees are happy about working here, and consequently their productivity is linked to their happiness.

Have you developed any fresh perspectives about corporate-community relationships?
We’ve decided that what communities really want is bricks and mortar, not a lot of mumbo-jumbo or fancy press releases. They want real buildings. So we’ve decided to focus on cities in tangible ways. People want things they can touch and feel, and we believe that’s what we can provide. We’ve decided to play that role in cities by bringing builders, realtors and community groups together, and then providing some of the money to make a difference in the community. People want real money and real progress. And that’s been our focal point from day one.

Want to do something nice this year for your low-income workers—without spending money? The Internal Revenue Service has a program called Earned Income Tax Credit (EITC). Here’s how it works: You make advance payments to qualified employees from the taxes you’d normally withhold, and their salary, in some cases, increases by as much as $100 per month. You then claim the amount on your quarterly employment tax form, and you’re done. It’s that simple.

Most of you may already know about EITC. After all, it has been around since 1975, and revisions to the laws made in 1993 further increased overall awareness (not to mention participation rates). Still, it never hurts to revisit a program that increases the take-home pay of people who may be struggling just to make ends meet—especially when you consider more than 15 million workers may qualify for this particular tax credit program.

“Most employers are concerned about benefits and pay, and this is one way they can provide additional income to qualified employees,” says Wayne Goshkarian, president of Phoenix, Arizona-based AGB, an employee benefits consulting firm.

When the EITC was first considered in 1975, policy makers agreed the most significant objective should be to assist in encouraging nonworkers to obtain employment and to increase qualified workers’ income. Last year’s qualifying requirements for EITC broke down this way: employees who earned less than $25,760 a year and had one child living with them, employees who earned less than $29,290 a year and had two or more children living with them, and employees with no children who earned less than $9,770 a year. In addition, the Federal Government will refund any earned income tax credit not claimed by the employee for the past three years to a maximum of $1,000 per year.

Let workers know about the tax credit program.
The EITC is the only benefit delivered to low-income individuals through the tax system. Unlike other cash-assistance programs for low-income families, applicants don’t have to wait in long lines or take time off from work to apply.

For those who still don’t know about it, though, HR simply can send out notices. Pat Lally, personnel manager for Des Plaines, Illinois-based Amerihost Staffing, a human resources and payroll company with 2,900 employees at 100 hotels in 15 states, says she thought the whole EITC process would become a “massive undertaking,” but it didn’t. “These days, our people see this as a program that says we’re willing to go the extra mile for them.”

The rest is up to your payroll department.
Many HR managers may not even know the IRS requires them to notify low-income employees that they might be eligible for the earned-income credit. “A lot of people make less than $29,290 per year,” says Goshkarian. “Although most HR people have heard of the program, they don’t really understand how the credit works or even if their employees are eligible.”

It takes about 15 minutes to explain the program to your employees and determine their eligibility. Then it’s just a matter of filling out IRS Form W-5, the Earned Income Credit Advance Payment Certificate, and turning it over to your payroll department (most payroll software programs accommodate the processing). You don’t even need to send it to the IRS. Just keep the form on file. The next paycheck your employee receives will see a substantial increase.

“Just because it doesn’t cost you anything doesn’t mean you aren’t providing a service to your employees,” adds Goshkarian. “Your employees get the dollars and you’re seen as a hero for bringing it to everyone’s attention.”

If you believe the reports that health care costs will double from $1 trillion in 1996 to $2.1 trillion in 2007, you’ve doubtless come to the conclusion that no company can afford to be spendthrift with its health benefits program. In today’s rapidly changing managed-care industry, it’s not paranoid or hysterical to want a head-to-head with your benefits carrier, but it may not teach you a tenth as much as a scientifically valid employee assessment survey.

“It’s imperative that a good quality assessment program be in place to help employers gauge employee satisfaction and to refine the company’s managed-care strategies,” says Elliot M. Stone, executive director and CEO of the Massachusetts Health Data Consortium (HDC), a nonprofit corporation that collects and analyzes health care information. “And given how much time and energy surveys can take, it’s equally as imperative that employers learn how to adjust their programs based on the results.”

Stone co-authored an employee health benefits survey and users’ manual for the Brookfield, Wisconsin-based International Foundation of Employee Benefit Plans, a nonprofit educational association serving the employee benefits industry. According to the manual’s introduction, assessment surveys can provide rich information for employers in the following ways:

• Characterize the health status of employees as well as their dependents.
• Determine whether there’s a need for change in one or more health plan options.
• Specify the direction in which those changes should occur.
• Renegotiate managed-care relationships by explaining current health care needs.
• Identify employee behavior problems that can cost the company more money.

Right away, you can see a number of things that sound potentially great for human resources professionals about employee assessment surveys. And to many employees, it may be seen as a commitment on your part to maintaining a high-quality health benefits program.

But the information is only as “powerful as the questions you ask,” says Ron Deprez, president of Public Health Resources Group (PHRG), an independent health care consulting firm based in Portland, Maine. “Let’s say a large percentage of your employees have asthma. Unless you know this, you might not be inclined to pay someone to educate them on how to treat their allergies. The cost of preventative measures can be far less than the cost of hospital care. And the only way to answer these questions is with an employee assessment survey.”

Design your survey with employees in mind.
The Chevron Corp. in San Francisco, California, conducted a national survey in July 1998 of roughly 10,000 of its employees and retirees with self-insured medical plans. “It’s one thing to evaluate the finances of a company’s health benefits program, what it covers and so on, but employers also should consider what their employees have to say,” says Tanya Bednarski, manager of health and welfare plans for Chevron Corp. “Surveys give you a lot more than just anecdotal feedback.”

Chevron used an outside third-party vendor to conduct its survey. “We structured it so that the same questions were asked for each and every health benefits plan we offer,” says Bednarski. “That’s helpful to us because now we can standardize the results.”

Unless you’ve had experience designing surveys and interpreting the results, you’re better off leaning on an independent third party to do the legwork. It helps to be prepared by focusing on the type of information your company will need and use.

Assessment surveys should be designed in such a way that you can mine the employee health data for trends. For openers, you want specific information about employees’ health status and their preference for services, and how they use those services. Do healthy employees use the plan? Who are the heavy users? Are there any smokers? Does age or gender make a difference? What are their coverage priorities? Some employees may want coverage for chiropractic care, while others may want coverage for other alternative therapies. Most managed-care administrators encourage several open-ended questions regarding benefits.

Some employees may fear the health data information will somehow be used against them. “That’s why you should never ignore employees’ privacy,” says Kimberly Wedell, principal with the Milwaukee, Wisconsin-based ROC Group, a human resources consulting firm. “Confidentiality is a must when conducting an assessment survey.”

To that end, it’s best to administer the survey in-house or by mail. Encourage employees to participate by posting a preliminary announcement indicating when and where the survey will be held. Make arrangements for absent or otherwise unavailable employees. Survey results should always be posted to remind employees they were involved.

Above all else, emphasize that it’s not just about saving the company nickels and dimes, but also about employees’ satisfaction with their own health plans.

Naturally, the value of any employee survey depends mainly on its validity and reliability, says HDC’s executive director Stone. Through interviews with human resources managers and extensive literature review, the employee health benefits survey he designed yielded sample questions that pinpointed key employee health status problems and health care needs. These questions were then pretested and modified to ensure that the language was neutral and unlikely to stir up expectations for change. Terminology that could have biased the results was deleted. “You want to compare the results over time and to the results from other employee assessment surveys,” explains Stone. “This type of rigorous surveying methodology ensures a high response rate and produces precise and unbiased results.”

Adjust your program based on the results.
You should realize that conducting an employee health benefits survey is a huge waste of time, money and effort unless you use the data to customize your company’s health benefits program. Gina Alongi is administrator for the Lexington, Massachusetts-based International Union of Operating Engineers (Local 4), a construction union of 2,900 heavy-equipment operators. Two years ago, members were surveyed about their views on the current self-administered health benefits plan. As a result, says Alongi, “several options were added to the existing program,” including coverage for hearing aids.

To revise and enhance your health benefits program, though, you must be willing to adjust to the results, says PHRG’s Deprez, who conducted the survey for the heavy-equipment operators. “You should also use the data to educate employees on better health practices,” he emphasizes. “Depending on your workforce, you may have to educate them about cardiovascular disease instead of diabetes, mental health instead of asthma. This sort of attention gives you a healthier workforce, and who doesn’t want that?”

Assessment surveys should also yield plenty of ammunition to renegotiate coverage with service providers. Let’s say a number of employees last year had problems processing their claims. The information can be used to remind your plan administrators about meeting their obligations. If nothing else, it puts you in a better position to negotiate coverage in the future. Based on the results of an assessment survey two years ago, Chevron actually dumped one of its significant health benefits vendors. “We tried working with the vendor, but on the second go-around, our employees were still dissatisfied,” says Bednarski.

If your company uses an HMO, you may not have to worry about surveys. The Washington D.C.-based National Committee for Quality Assurance requires that all HMOs that earn accreditation administer an annual members’ satisfaction survey. Otherwise, PHRG’s Deprez recommends companies evaluate their health plan effectiveness and performance with some kind of employee assessment survey. “If nothing else, you can make sure you’re providing a good health benefits plan to your employees at the lowest possible cost.”

One of the mysteries of life in the United States today is when the Federal Reserve Board will next raise or lower interest rates. Economists find it as difficult to forecast as the weather. It’s like watching mercury in a thermometer move up and down, day after day, year after year. There’s not much you can do but sit there and watch, prepare for the worst and hope for the best.

Given how important interest rates are to the economy, businesspeople every day struggle to make sense of it all. One quarter-point change up or down can lift a company’s spirits sky-high or send them spiraling into a bottomless depression. This may be a slight exaggeration, but it’s undeniable that change is an expected characteristic of the economic environment in which U.S. companies operate, and financing your company is getting more complicated all the time.

Low interest rates lift economy.
According to conventional theory, rising interest rates increase the cost of borrowing money, and thus cause a drop in investment because it becomes too expensive to borrow money—money that could be used to expand plants, finance research, acquire firms and produce goods and services.

Lately, though, the economy has been getting a boost from relatively low and stable interest rates. Cheaper loans are good news if you’re investing in new projects, borrowing to make long-term investments to accommodate growth, and giving workers annual raises.

“Oftentimes, companies have to rely on loans to continue doing business,” says John Wachowicz, co-author of Fundamentals of Financial Management (Prentice-Hall, 1998). “A low-interest rate environment makes it easier for businesses to raise capital, which means it’s a great time to conduct business.”

Projects that weren’t feasible when interest rates were high are reasonable in a low-interest rate environment. More or less, this means most people have jobs.

This type of labor market makes it tough for companies to hire experienced workers. The unemployment rate is lower than it has been in years. Companies are struggling to find people, and they’re having to offer additional incentives over what they’re accustomed to offering to get the same quality of worker. Things could be worse. But don’t think for a moment that the current low-interest rate environment will last forever.

It’s time to think ahead.
Of course, most businesspeople would rather operate in a low-interest rate environment than the alternative. But let’s not forget the interest rate spike that moved the prime from 11 percent in late 1980 to 21.5 percent in 1981. Some companies are starting to think about how high interest rates in the future might sting.

“Many companies are taking this opportunity to adjust their capital restructure,” says James W. Wansley, head of the financial department at the University of Tennessee in Knoxville. “Everyone knows debt is less expensive than before, and the interest companies pay for debt is tax deductible. Companies should use this time to clean up their balance sheets.”

This isn’t an entirely new notion, but no one knows for sure when the Federal Reserve Board will jerk the interest rate’s levers. The worst mistake any company owner or manager could commit would be to pay no attention to the warning signs. Better to monitor worldwide economics and political trends than to ignore everything and be caught unprepared.

It’s easy enough to get carried away with a booming economy and low interest rates. But maybe it’s just a matter of time before interest rates make a significant move in the other direction. Clearly, it’s dangerous to assume that interest rates will stay at their current level, which means it’s best to take precautions now when borrowing money because even economists can’t see the smudges on the economic horizon.

In an industry plagued by low wages and a turnover rate estimated between 51 and 300 percent (depending on the source), and where the difference between four stars and five stars can turn on bed linen and turndown service, the Atlanta-based Ritz-Carlton Hotel Company attributes the success of its 35 hotels from Boston to Bali on a rigorous customer service training program.

The Ritz-Carlton serves the top echelon of the traveling market. For that reason, the company throws a lot of money and energy at training its 16,000 employees on concentrated dosages of the Ritz credo to “fulfill even the unexpected wishes and needs of our guests.” Of course, maintaining such standards is no easy challenge. You can’t be expected to provide extraordinary service with an ordinary approach to customer service.

To learn more about how the company trains its employees on the “gold standards” of customer service basics, WORKFORCE interviewed Leonardo Inghilleri, senior vice president of human resources for the Ritz-Carlton Hotel Company.

Why does Ritz-Carlton feel it’s important that every one of its nearly 16,000 employees undergo rigorous customer service training?
Customers who come to our hotel pay a premium for perfection. We have this tremendous challenge to meet and exceed customer expectations. That’s why we discuss customer service every single day of our lives. It starts with how we select our employees. We use scientific interviews to understand if an individual has the necessary behavioral traits to make him or her successful in our company. Only one of every 10 applicants is hired.

What sort of traits?And how do you ‘scientifically’ determine if a prospective employee has these traits?
A person who works for us has to be hospitable, quality-oriented, attentive to details and so on. We’ve identified the top performers by job (waiters, chefs, housekeepers, etc.), and with the help of a psychological test we’re able to determine the ideal profile for each specific job. If you want to be a successful housekeeper, for example, you have to have certain talents; and if you don’t have these traits, you’re not going to be hired. There also has to be the desire to use your talents, which a lot of people don’t have. We interview each one of our employees in a scientific way to allow us to understand if that person possesses these specific talents.

Can you give an example of the ideal profile for, say, a housekeeper?
Our housekeepers have to have exactness, they have to be attentive to detail and they have to have pride in their work. This is important because people need to feel good about their performance.

A doorman, on the other hand, has to be more of a people person. He needs to be able to send a friendly message to a customer when he’s still 100 feet away. It’s called ‘relationship extension.’ You don’t necessarily look for exactness in a doorman.

What sort of orientation does the Ritz-Carlton put its employees through?
An employee who wants to work for the Ritz-Carlton will desire to provide exceptional customer service. But the concept of desire can only exist if we’re capable of enlisting this person into the texture of our company.

Our orientation happens on the first day of employment. That’s when the person is more responsive to behavioral changes, when you can drive the company’s business philosophy into the person’s psyche. If you wait too long, the window of opportunity is closed. Therefore, from day one, we create an environment that’s caring, supportive and energizing.

For example, when you’re a new employee, you’re assigned a trainer who’s with you all the time for the next four weeks. The trainer has the responsibility to explain the tasks, make you do those tasks and review your performance.

How are the 120 hours of customer service training actually divvied up?
It depends. Our entire training system is a combination of two key elements: technical skills and the Ritz-Carlton customer service philosophy.

Technical training is task based. By ‘technical training,’ I mean how to service in a fine-dining restaurant or how to make a bed according to our standards. Learning how to perform a task may last an hour, or a week, and then it’s reviewed. Ultimately, each employee is certified by the trainer. There may be 19 steps to making a bed. Until you make those beds perfectly, you’re not going to earn a certification.

Customer service training is a little more complicated. We train our people how to resolve guest challenges. After all, it’s an imperfect business we’re in, and a lot of things that can go wrong will go wrong. A toilet might get clogged. A television at a certain point will break down. You have to train your people to instantly pacify our guests.

As a 24-hour, seven-days-a-week business, how do you train people to think on their feet?
You really can’t train a person to think on his or her feet. You have to select a person who’s quick in his or her thinking. First and foremost, the person has to be confident in the sole knowledge of his or her job. You can’t expect an employee who isn’t competent in his or her own skills to solve a problem. The way to teach people to think on their feet is through proper selection, strong training and the creation of the desire to satisfy a customer.

We also give them endless hours of resolution techniques for guest problems. We empower our employees to resolve any customer challenge, no matter what. You don’t pass the buck. If you’re a waiter and you hear a customer complaining about a problem with his TV, we expect you to call the engineering department and report the problem, then call back the guest to make sure the problem was resolved.

This creates unbelievable loyalty with our customers. We actually found that our most loyal customers are those who have had some minor problem, yet had that minor problem quickly resolved by a competent employee.

How do you reinforce this type of training?
Traditional companies abandon the person after orientation—but not at the Ritz-Carlton. On a daily basis at the beginning of every shift, we have a lineup meeting. Every employee in our company goes through a 10- to 15-minute meeting in which several things are reviewed, particularly why we’re in business and our continued commitment to ‘gold-standard’ customer service. During these lineup meetings, we also discuss topics sent from the corporate offices, and the same topic is discussed at every one of our hotels throughout the world on that particular day. This creates an ongoing organizational alignment. If you don’t repeat the message, people forget. How do you energize on an ongoing basis someone who has to clean 14 rooms a day? You have to discuss the principles of the company on a daily basis.

What sort of financial and time commitments are we talking about here?
It’s a huge investment on our side. Think about it: Every employee spends 15 minutes every day in a meeting. Some might see this as a 15-minute loss of productivity, but we believe these are the most valuable 15 minutes of the day. We use this time to recognize and celebrate people, and create a sense of belonging. Of course, we also offer our employees competitive pay and a challenging environment. And if they embrace our philosophy, their opportunities for growth and advancement are unlimited.

Does this sort of commitment yield the appropriate results?
Absolutely, otherwise we wouldn’t do it. It takes tremendous effort and discipline from our management to accomplish these goals.

What exactly do your employees come away with after 120 or more hours of customer service training?
From the training, they become professionals in the hospitality industry. In this industry, you’re either professional or you’re a servant. Making beds and cleaning toilets and serving meals are professions if they’re done with pride. We don’t create servants. We create professional employees who have the desire to provide exceptional customer service, and who want to be part of our company.

Are there any special considerations because it’s a high-turnover industry?
Turnover is the single biggest problem of an employer in this industry. But we choose to have a good compensation package to attract and retain the right people. We feel that a successful company is one that’s both a learning and a teaching company. You have to learn from your customers, your employees and the changes in society. At the same time, as a teaching organization, we provide our people with new skills, thereby enriching their lives both personally and professionally.

Does the fact that you have 35 hotels all over the world cause any sort of cultural problems when hiring and training employees in a customer service industry?
We had to focus a lot on the cultural aspects. We’re not an American company that goes into another country and says, ‘This is the way we do business.’ But customer service transcends culture. We don’t focus exclusively on the manufacturing aspects of the business. What we leverage is the sense of hospitality.

Every single culture has its own sense of hospitality. In Bali, we will not ask our ladies and gentlemen to say good morning and good afternoon. Instead, they’ll greet in the traditional way by joining hands and bowing. We try to identify what makes that specific country special from a hospitality point of view. And then we adapt to its citizens’ ways of being hospitable.

How can you make the program more effective?
What we’ve done recently is improve the skills of our facilitators. Our biggest fear is that our lineup meetings become repetitive, and that there’s no passion or emotion. Recently, we’ve done a major retraining of all the facilitators to make sure they’re capable of engaging the participants, enlisting their hearts and souls. It’s not just a download of information. It should be a passionate and emotional moment that re-energizes each employee for the day.

We also survey our employees. Recently, management said that from a personal growth area, we as a company were not satisfying their needs. So we identified programs that helped improve their personal growth. We strongly believe that if we don’t satisfy the needs of our workers, they’re not going to satisfy the needs of our customers. We also believe a better human being will be a better professional.