This column is excerpted from Jim Sullivan’s new book, “Fundamentals: 9 Ways to Be Brilliant at the Basics of Business.” It’s available exclusively at Amazon or Sullivision.com.
You can’t build a pyramid from the top down. A house without a strong foundation will not stand. And a business without fundamentals firmly entrenched and dutifully executed can wither and shrink as small as the period that ends this sentence. There are nine essential building blocks of successful foodservice companies in the second decade of the 21st century:
Focus. When companies start strong and stay strong, it’s because they focused on the right things. (Being focused on the wrong things can be more detrimental than having no focus at all.) Focus is not just “clarity,” it’s about inspiring a shared vision. Focus is not just knowing the destination, it’s following the roadmap. Focus is not just “wanting to win,” it’s the willingness to prepare to win. Focus is not just being committed, it means being disciplined. What do the best foodservice operators focus first on? The things they can control. Not the things they can’t. Make the things that won’t change in your company — Quality, People, Culture, Training — ever stronger, ever better.
Build Strong Teams. Make hiring The Most Important Decision. If you don’t have the right discipline and systems in place to assure that only the most dedicated and most passionate and most talented people are allowed onboard, you put a weighty (and unnecessary) daily burden on your frontline and multiunit supervisors. It forces them to under-lead and over-manage. This frustrates supervisors and takes them away from their most important jobs: developing teams and customer focus. You don’t build “business,” you build people. People build business.
Serve Better. In case you haven’t noticed, the top-rated customer service organizations are now online companies like Amazon and Zappos, not traditional brick-and-mortar stores with a face-to-face presence like Nordstrom. What happened? For one thing, these online companies anticipated and resolved 90% of their customer service challenges before customers visit the site. By investing in a complex infrastructure, FAQs, built-in suggestive selling and a no-constraints mindset and makeup, they can almost guarantee a smooth experience — providing you’re not a Digital Alien. But brick-and-mortar operations like restaurants are dependent on a Freudian Smorgasbord of people and personalities for their service delivery, not the mathematical algorithms (and, it should be pointed out, a willingness to self-serve) that characterize Web customers. The thing is, the Internet is digital, but people are analog. To serve better, know that guests don’t want to be treated like customers, they want to be treated like people. Teach your customer-facing team members the art of conversation; this skill is the connective tissue of guest engagement and heartfelt hospitality.
Sell More. Think about all the different ways a business can gross more money: unit expansion, acquisitions, selling new franchises, going public, selling assets, etc. But the best route to a healthy balance sheet is by simply 1) acquiring more customers and 2) raising same-store sales. Do so with great service, smart selling and focusing the outcome of every transaction on a repeat visit.
Spend Less. The average profit on the dollar in the restaurant business is about a nickel. So if you sell a burger for $5, you don’t “make” $5, you make 25 cents (a nickel on the dollar times $5 equals 25 cents). And if someone breaks a glass that you paid $1 for, you now have to sell FOUR burgers to pay for that $1 glass. If someone breaks a $10 plate it will require you selling FORTY burgers to pay for just that one plate. To summarize: Sell 40 burgers and break a $10 plate during a shift and guess what else you’ve broken? Even. Sell more to spend less. And don’t forget that everything you don’t sell has a triple cost. You pay to buy it, you pay to store it, you pay to throw it away.
Always Be Marketing. Smart foodservice leaders approach marketing as a philosophy, not a department.
Out-Teach the Competition. Hire people with a bias for learning. And revise and improve your training materials every year. Job one: teach your team members how to think, not just what to do. If you train only to a process, all thinking stops.
Lead Smart. Leadership is not a personality trait so much as the ability to master variable skill sets and know when and how to apply them. All leadership is situational. Smart leaders are prepmasters: since you don’t really know on which day success will occur, you have to be ready every single shift.
Execute. There are three elements of effective execution: 1) Habitual Consistency: daily and steady application of the Fundamentals, eliminating barriers to execution along the way. 2) Discipline: holding yourself and your team accountable for excellence — and results. And 3) Focus: knowing where and how the Fundamentals have to be applied if anything is to be executed: The Shift. Which brings us full-circle to the first Fundamental.
There was a time when focusing on the Fundamentals really mattered. That time is called now.
Jim Sullivan is the founder and CEO of Sullivision.com, a leadership-training company whose clients include Walt Disney, Coca-Cola, McDonald’s, Applebee’s, Sam’s Club and Marriott International.