When upgrading foodservice, creating a budgeting and bonus program that encourages and rewards cooperation is a must.
By Fran Duskiewicz
Many companies who attempt to incorporate an upgraded foodservice operation into existing store operations often overlook the complexities and possible counterproductive managerial head-butting that can occur.
Rearranging the store level organizational chart so that current retail managers are in charge of everything, no matter what, is short-sighted and probably unfair to all involved.
And while evolution might help solve the issue over time, no one has time for evolution as a problem solver. So, what can you to make sure your newly-minted foodservice endeavor doesn’t create store level confusion and an internal tug of war?
Well, having a strong, team-oriented, customer-focused culture is a must, but even that will only go so far. I think that creating a budgeting and bonus program that encourages and rewards cooperation is a must. Categorizing stores by size, volume and operational complexity will also help, because then you can create a managerial career ladder within your own company, complete with a new set of job titles.
CREATING VALUE
At Nice N Easy, we envisioned Easy Street Eatery as a company within a company—sort of a foodservice operation that we franchised to ourselves. We knew that we needed to hire foodservice professionals to manage these units, so we recruited experienced fast food managers and chefs to ramp up our expertise as quickly as possible. While that might seem like a reach, it really wasn’t, because we were offering a more normal work schedule for these people—mostly weekdays, when they were used to nights and weekends. We offered them a better quality of life.
However, to ensure these new managers qualified as exempt, we needed to be very specific about their direct managerial responsibilities, such as hiring and scheduling, and they needed to be given a labor budget separate from the store’s. This could be problematic, right?
To minimize that risk, we created the job title “store director” for high volume retail/food stores and for the new state-of-the-art mega-stores that were coming online. This allowed us to “promote” our best store managers to the most challenging positions within the company. These people were also the best equipped to create the team atmosphere necessary to make the foodservice operation work properly and to partner with the foodservice manager for the good of the location and of all the associates.
While foodservice managers did have their own specific monthly goals and budgets, mystery shop visits, monthly report cards and quarterly bonuses, a store directors’ performance was judged upon everything within the store, foodservice included, and their bonuses were accordingly larger. The key for both managers became productivity, or our favorite metric, gross margin dollars per labor hour.
Management teams knew if they shared resources and helped maximize the store’s overall labor productivity performance, that would work to their benefit and increase their bonuses.
JUST REWARDS
I believe that if our balanced scorecard and bonus system didn’t actively acknowledge and reward this type of managerial cooperation, the incredible success we experienced in the new Easy Street Eateries and large store concept would not have been possible. Managers worked together to reduce internal theft, some of which was resulting in poor food margins, and a bad mystery shop in the Easy Street was dealt with as harshly as it would have been at the checkout.
Earlier, I mentioned evolution as helping this integration process and that certainly happened at Nice N Easy. By creating the store director position, and making it aspirational, we began to see our most successful foodservice managers apply for the positions when they became available. By having these experienced professionals step up to oversee the entire operation, we had the best of all worlds. This person could supervise every employee and process within the store. The new foodservice manager looked up to them and listened, because of their success in that area.
These people were also more likely to delegate bookwork and other back-office functions, focusing time and attention up front, which is exactly where we wanted them.
It wasn’t easy, and it took great care, attention and lots of time to change our business model. To assume it will happen overnight, or on its own, is a mistake. Don’t make the mistake of having too many chefs, or chiefs.
