A Guide To Rethinking and Reimaging Your Restaurant

By John Barton, Boston University School of Hospitality Administration, SHA’24 and Priya Tewani, Boston University School of Hospitality Administration, MMH’22, CAS‘21

The restaurant industry is still reeling after a record-breaking and expectation-shattering summer of 2021, during which many restaurants and tourism businesses saw revenues return to within 80% of pre-pandemic levels (Statistica). Despite omicron’s toll in the early months, 2022 is still on track for the travel and tourism industry to exceed 2019 revenues by nearly 7% (WTTC). Accompanying this uptick, operators remain in gridlock with employee hiring and retention, an issue that has plagued the industry for years but has come to the foreground during this Covid rebound (WTTC). Today, preparations are well underway to enter what is anticipated to be yet another high-volume leisure-spending and consumption season. With that anticipation, however, comes the harsh onboarding reality that continues to stretch the abilities of management and employees alike. We suggest that an effective benefits program is at the crux of the issue.

After increased financial incentives failed to effectively curb the mass resignation of 2021 (Eater), it is recommended that managers, owners, and corporate level stakeholders start to introduce, reimagine or improve upon the common practice of incentivizing through financial bonuses being directed at an ultimately unmotivated and emotionally deprived workforce (Business Insider). Late-in-the-game hiring from a desperation mindset has a cost on the staff, guests, and bottom line. Rather, reassessing the operational systems, benefits, and leadership strategies can make the industry not only more attractive for the employee but far more sustainable for the organization as well. After reassessment, calculated refinements to unit-level leadership systems can help foster staff longevity that will ultimately translate into a seamless and more personable guest experience. 

Treating benefits improvement through this longer-term lens could be the key to keeping a restaurant well-staffed, or simply a tool to improve overall operations through employee development. Speaking to Covid-related staffing challenges, Parker Doyle, a SHA 2018 graduate and restaurant consultant, stated: “This is not a labor crisis, this is a wages and benefits crisis.” Regardless of a restaurant’s current staffing situation, we recommend the use of the below-outlined process of operational systems review, benefits reevaluation, stakeholder discussion, and transparent implementation.

Work to Create a Business Model That is Realistic and Equitable for all Involved

Employees may face job-related burdens that are hidden or hard to see for managers whose focus is more targeted at maximizing restaurant revenue. Especially for areas that rely on sporadic or seasonal peaks in demand, it can be easy for an operator or organization to manage challenges by handling issues as they arise, rather than looking at the bigger picture or analyzing root causes. It is important to take into account operational capabilities from a staffing and efficiency standpoint to avoid over-burdening the operation. However, doing this by simply reducing key operating variables at the crux of the business model, such as operating hours and guest capacity, could be detrimental to the bottom line. For owners to avoid eliminating top-line revenue among an already tight margin set now targeted at Covid loss-recovery, taking a more holistic and intentional approach may be the preeminent answer for some.

Strategies such as walking through the guest experience from start to finish and even having management take time to shadow employees in their position could help operators gain insight into certain operational inefficiencies at the core of the restaurant. This process is established in certain sectors of management (People Dev. Mag.). For example, job shadowing is already an adopted practice in corporate America. Introducing this to restaurant management, although time-consuming, could uncover inefficiencies or gaps in processes. When resolved, solutions could ease the physical burden and task saturation on employees. In addition, ideally, this can be done with limited impact on the bottom line or end guest experience.

Eliminate the Fourth Wall: Start Having Real Conversations With Your Staff

Limiting employee interactions to directives and tasks tolls on one’s satisfaction and desire to work. By contrast, taking time to make a human connection fosters motivation or reassurance among employees. Moreso, the age-old perfectionist, iron-clad fist leadership strategy is timing out fast among FOH and BOH alike (Edible Mag.). When some form of onboarding en masse is inevitable, organizations need effective role-model leadership coming from the core of the workforce, which can only happen with strong efforts toward retention and motivation. 

Managers who take time regularly to have conversations individually with staff at all levels give the signal from above that not only is the organization focused on improvement (Toast), but more importantly, it values and thrives off the honest and professional opinion of the staff regardless of their standing or rank. This strategy could intersect simultaneously with a more traditional method of feedback such as a performance review identified through job shadowing if it doesn’t already. Even if the message is not necessarily overly positive, the regularity of the interaction often supersedes the nature of the content itself. This strategy of “management by wandering around” (MBWA), where managers increase their presence among the staff, can help increase both morale and garner a sense of visibility from management (HBS).

As a follow-up, creating open lines of communication between employees and decision-makers can help address internal challenges before they devolve into retention issues. Employees have always been the lifeblood of restaurants. Now, the landscape has changed so that the power is, now more than ever, in their hands. Starting to take care of the employee will lead the employee to start taking care of the guest. Furthermore, creating a workplace that values listening and communication followed by ongoing improvement can give operators the ability to transition out of the survival mindset that plagues the industry today. 

James Beard award-winning chef Jodi Adams highlighted the practice of financial transparency to unite her team in her restaurant group’s success, “At Saloniki, we would post weekly revenues on the dry erase board in the back, along with next week’s forecast, it gave out staff insight into how we were managing, and where the restaurant was at during any given point in time.”

Seth Gerber, SHA instructor and co-owner of MIDA in Boston, subscribes to a similar strategy: “I love being able to interact with my employees on a one-to-one level… When an employee is thriving, it gives me insight… When we need to have a serious discussion about performance, I’ll take that person out on a walk for coffee… As an industry, we need to become better employers.” 

With the presence of assumed ownership, employees naturally are motivated through thoughts of growth and responsibility, a phenomenon that can both increase longevity and identify stand-out staff performers that otherwise may have gone hidden or unrecognized. Managers should be empowered to be honest, creative, and ongoing with this strategy (The Muse). As a secondary benefit, information can be relayed to leaders on the main issues and opinions within the restaurant’s core, potentially shedding light for management on how they can optimize their strategies to eliminate inefficiencies and other emerging challenges.

In summary, for the manager, improving communication helps to better convey intentions and dispel misunderstandings. Regardless of the scale of the restaurant or the degree of change being implemented, sharing information – good or bad – reassures the staff that they are valued and cared for. 

Rethink Benefits to Meet Staff Needs, But First: Be Transparent

Although an idealistic benefits program may be out of reach or costly, operators should be prepared to communicate accordingly when necessary. No employee is going to appreciate, nor see long-term motivation through a blue-skies outline from management on how conditions are set to improve. Leaders need to be deliberate and thoughtful on what benefits are realistic for the organization to roll out over varied time periods. Again, better wages are not the only answer; providing a more contemporary set of benefits centered around healthier well-being and lifestyle can be far more valuable in message than the actual cost to the bottom line.

When detailing roll-out to staff, communication and honesty is everything. If it is going to take another month for a benefit to roll out due to unexpected expenses, be transparent and tell them why. If a full implementation of a benefits structure is laid out over a three-year period, build anticipation through honesty. As an employee, this trustworthiness will extend beyond those meetings and will result in stronger, more honest future management-employee interactions. From a quality of life perspective, employees are going to ideally see a system that is working in their favor, not against them. Taking this shared approach commonly lauded in corporate culture (HBR) and applying it to unit-level restaurant management creates a bond between staff and a heightened perception of candor with managers.

When it comes to the nature of the benefits themselves, harkening back to ongoing communication may be a good place to start. If you are not doing the following already: get to know what your employees do, with whom they interact, and what they struggle with outside of work. The goal is to increase workplace engagement, and secondarily to open operators’ eyes to how the workplace can become a helpful contributor rather than a burden.

French 75, a fine dining restaurant in Denver, hired a mental health clinician for staff support (NPR). A central PA restaurant started providing dental insurance to its full-time staff after conversations revealed that was what they wanted (Pennlive). Restaurants can foster longevity through benefits without necessarily providing the most costly options. Even certain QSR chains are starting to experiment with more progressive benefits systems amid Covid-19. However, choosing what is both beneficial and realistic does not have to align with the norm. If employees are struggling with social isolation, curb that concern by hosting group outings or partnering with local mental health counseling facilities. If employees need more time to take care of their life outside of work, look into more frequent paid vacations on shorter intervals or even simply re-evaluating schedules and consider options for more flexibility. The most expensive or time-consuming benefits plan may not be what employees truly need, and personalization will resonate more than financial remuneration alone.

Implement Integrated Technologies to Allow for Stronger Leadership Visibility

Using restaurant tech as an aid rather than a substitute for people can increase manager visibility without compromising back-office duties. With the increasing number of integration functions being implemented in restaurant software, allowing one system to potentially take a right hand in controlling and reporting labor, costs, profit/loss statements, third-party revenue centers, and even HR functions can be invaluable for operators (Restaurant Business Weekly). Systems such as from Boston-based technology-solutions company, Toast have already made strides in giving small restaurant owners technology previously only available for in-house buildout. The sector’s reach is only expected to expand to include a larger proportion of the full-service market (Toast). 

Boston University graduate of the Master of Management in Hospitality (MMH) program and restaurant consultant Kealoha Pomerantz notes, “Lots of people don’t understand the value good restaurant tech can bring to a business.” When restaurant operators realize the long-term effects of having managers visible and available to employees, they can ideally see the value in overcoming the marginally depreciating costs associated with technology integrations. By easing the back-office burden on already taxed managers, employees will see the satisfaction, reliability, and comfort that comes with having transparent leadership to lead, motivate, engage, and ultimately, retain employees.

Conclusion: Longevity can Occur on Multiple Fronts

Broadening the scope to a culture of continuous improvement, the implications of longevity could extend far beyond the employee. Moving from a “survival mentality” where company culture and communication suffers to a strategy that increases transparency, commitment, and trust benefits both the business as well as all of its stakeholders.

Acknowledgment 

Thank you to the peer reviewers of this article. This article has been accepted for publication by Taylor Peyton and Priyanko Guchait, Editors of BHR’s Leadership issue.

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