With only three entries left in my Restaurant ReBoot series, I've decided to pause, re-group and bring some of the concepts introduced so far into a working example. Discussions of vision, strategy, execution and performance measurement are feeling a little vague and hazy to me. People are struggling to keep their businesses afloat and their people employed. Survival is what's on the minds of clients, colleagues and friends these days and I've been pumping out blog posts on management theory. Is this notion of vision, guiding principles, BHAGs, priority setting along with alignment and engagement just a misguided pipe dream?
The answer is yes and no. On the one hand, it is all an ideal, and on the other, it is a necessity. I am a pragmatist. I have little time for idealism or ideology, but I know what has an impact.
I honestly believe we are being presented with a unique opportunity to look at new and better ways of running our businesses and our lives. While it is difficult to lift oneself out of daily survival mode, I can only stress how important it is to shift toward working on the business and charting a new course. Afterall, hardworking entrepreneurs who risk so much and commit their lives to realize their dreams, deserve more and better.
I have unabashed respect for anyone who takes the leap into business ownership. My primary motivation with Table Nine Coaching is to be of service and guide in what can be a very lonely and frightening existence. This process ensures a degree of success. There is so much risk, especially now, you want some reward.
To be honest, our industry has been broken for a long time. Now, there is simply no way to ignore it. What is it that we can do to help business owners and the millions of people who work in the industry come out of this with an improved model and a real chance for whole life success?
There's a lot of talk around such areas as take-out, delivery, technology (robots), focused concepts, ghost kitchens, new service models and so on. These are great discussions and innovators are already moving forward in adopting change. For me, I find myself repeatedly going back to Square One—building stronger foundations for our businesses and lives.
Your vision lays out your direction, purpose, long and medium-term objectives. Most importantly, clarifies and defines your core beliefs—what we are/are not, believe/disbelieve, should/shouldn’t do. From here, everything must follow. In the face of this mess we are navigating, we can regain the soul of our business. There are no magic wands to wave. A solid foundation informs the best decisions.
Your guiding principles help define your profit motive. Your decisions and actions work to support that motive. Your principles shape your relationship to your bottom line, define areas in that require more resources, create an attitude of abundance and let positive intentions cast out fear-based ways of running your business. This is the time to determine your charitable support, profit sharing and compensation model… as well as what you want to re-invest in the business and how much ROI you must generate. I've worked with one company that decided to commit 40% of profit to charitable support, 40% to staff, and 20% to the business—Great motivation to drive a healthy bottom line!
So, how does this all come together? Let’s look at some possible guiding principles and see what we can apply to the current circumstance.
Quality
Now more than ever it’s time to re-commit to competing on quality and not on price. Race-to-the-bottom mindsets lead, well, to the bottom. Instead, look at all areas of product and service and raise the bar aggressively. Just good-enough businesses operating in the mediocre middle will not thrive.
To accommodate this move toward improved quality, you'll likely have to cut back on what you do. Do less and do it better! Quality can be a true point of difference in the competitive market. Your customers know quality, see quality and will reward quality with enhanced loyalty.
Stop trying to be all things to all people, tune out the chatter, and get better at what you do. Source better ingredients, improve processes, refresh presentation and get people talking about you.
With quality as the focus, you and your team will be working with the mindset of continual steady improvement and never make decisions that consciously compromise product or service.
Your staff and your customers will respond well to this bold move!
Team
Many say that they are “people first” businesses, caring for employees, creating safe and healthy cultures and providing environments where people thrive. How many companies are willing to put their money where their mouths are and adjust their profit motive to reflect this tenet? If shareholder value is the primary motivator, something(s) has to give, and often that happens on the people front. Our industry is notorious for low wages, no benefits, poor job security, lack of professionalism, burnout and mental health and addiction issues.
What could it look like if you choose to take a stand, turning this on its head using Covid-19 as an opportunity to ditch past practices? I'll touch on this more in an upcoming post. For now, let me simply say that without radical change, our industry is in deep trouble. We can be a catalyst both within our industry and across other sectors.
· Wages
Our minimum wage levels are solid compared to the United States, but we need to commit to paying living wages. Commit to paying non-tipped hourly employees (everyone but servers) above minimum wage. How about paying all of your employees the same hourly rate (a fair living wage for your geographic location) and pooling all tips to be shared equally, based upon hours worked?
· Management Salaries
Treat your managers as the hardworking professionals that they are. This is a tough job. Gone are the days of taking advantage of salaried managers. The next generations won't stand for it. Increase your salary ranges, improve perks and create an opportunity for balance, learning, development and growth.
· Tip Pooling
The brave among us have gone ahead and eliminated tipping and increased wages and prices accordingly. I applaud this, but it is an uphill battle to change society and culture that only understands the tipping model. If you have counter/fast-casual service, I recommend tip pooling with equal sharing as mentioned above. In the full-service environment, there must be a shift from servers earning too much, and kitchen and support staff not earning enough. I see servers tip out between 7%-9% of net sales now, which is excellent.
· Extended Health Benefits
This is a must. If you don’t offer extended health benefits, do so. There are many options, including premium sharing with your employees. There is a new option facilitated by the Real Hospitality Network that has an employee-paid option that is affordable for staff and costs the business nothing! Make it available to your people.
Community
We operate in community: our team, our neighbourhood, our industry. We should be active participants, if not community leaders. It doesn’t have to be a huge effort, but we can be visible, interested and engaged. It's not in everyone’s wheelhouse to be a “social enterprise”, but that doesn’t mean we can’t take baby steps to help those in our immediate community. What would it look like to raise money for the local food bank by giving customers an option to add $2 to their bill? How about hiring someone on the fringe who just needs a leg up by providing steady employment and the support they need to get on their feet? Can we hire someone differently-abled to do simple, yet essential cleaning jobs on a schedule that is manageable for them? Our industry has a unique opportunity to make an immediate impact where it is most needed.
Innovation
Well, aren’t we all innovators? If so, now is the time to do some blue ocean thinking and shake up your business and your industry.
Guiding Principles lead to defining your Purpose.
Your purpose shapes your Profit Motive.
The profit motive drives what priorities you set in your Action Plan.
All of the above land in your Budget.
Make it happen.
Until next time!