LLS Blog

Restaurant consultants have long argued that the food and beverage industry is overdue a major adjustment. Relentless growth over the last five years has led to over saturation in the food and beverage sector. In a buoyant market, anyone and everyone can take advantage of sustained high per capita spend on dining out and cover over the cracks of a flawed business model.

In a tougher climate, however, the laws of the jungle apply: only the strongest will survive. Food and beverage businesses are suffering and restaurant consulting services can help find and ‘fix’ those fundamental flaws these business had previously been able to ignore because customers were spending money. Whether it is poorly thought out concepts, unsustainable leases or a lack of financial control, the recent economic downturn has provided the much needed catalyst that the sector needed to clean up its act and it is restaurant consultants who can provide the experience a management team needs to guide them through these murky waters.

Lighthouse Leadership Solutions expects the economic downturn to enable operators with strong concepts, consumer orientated focus and back of house diligence to survive and prosper and force those who do not, to take a serious look at their business – or suffer the consequences. The economic reality is inescapable and while economic doom and gloom has been the flavor of the month for some time, the outlook can be positive with assistance from Lighthouse Leadership Solutions.

Arguably, a recessionary environment can provide a platform for innovation and economic growth through entrepreneurialism and creative thinking. This climate provides an opportunity for lateral thinkers and those with entrepreneurial flair to excel. For those operators, a restaurant consultant provides an independent view on how the business can improve – because there are always improvements to be made.

Conversely, those businesses with flawed models who are struggling for any number of reasons can benefit from a detailed review of every element of their business and troubleshooting – indeed their survival may depend on it. How can a struggling venue justify paying a restaurant consultant when cash is tight? We advise our clients, whatever position they find themselves in, to stand back and look at their restaurant from a fresh perspective. We emphasize the need to go back to basics and evaluate each and every revenue stream or cost center from the bottom up. Through this exercise of intense scrutiny, we know that almost all of our clients have the ability to improve or achieve profitability from existing revenues, without reckless and short term promotions that their cash flow cannot sustain, and safeguard the future of their business.

All too often, we see companies implementing strategies with a “shoot from the hip” mentality, without thinking of the repercussions of those strategies. Quick fixes to get customers through the door with too good to be true offers do not solve long term cash flow problems. While labor is always the biggest overhead, getting rid of good staff to the detriment of customer service is also a short term solution which leads to long term problems.

With experience in dealing with struggling and often insolvent businesses, we are able to provide an emergency review of a business. During a first phase, we can identify immediate cost savings and reduce pressure on a cash flow. While this is critical, equally critical is phase two of our review which entails creating the foundations for that business to run efficiently when we leave.

When we meet potential clients, we discuss ways to save money: vendor negotiations, procurement and inventory systems, dynamic labor recommendations. All too often, these customers simply go back to their business, slash costs and expect the business to right itself. The trouble for such companies is that slashing costs is not the answer. One of the many benefits our services provide is to immediately relieve the pressure however it is the ability to maintain this change and tighten up procedures that is a consultant’s value.

When we cross the road, we are taught to ‘stop, look and listen’ before we do so. Fixing a business should carry the very same message.  Lighthouse Leadership Solutions avoids short term strategies and focuses on the fundamentals of the business; a comprehensive review of profitability, efficiency and sustainability.

This market is providing restaurant operators with an opportunity to revisit their business and conduct an audit from the ground up, identifying wasteful cost centers and untapped revenue opportunities. A good consultant is someone who walks in the door with information, teaches it to the client and leaves that wisdom behind. An experienced consultant can also save money, find money and create money and it is these benefits that Lighthouse Leadership Solutions’ clients capture by bringing us in.

Paul Wilson Asessing Your Organization for High Performance, Customer Service, Developing High Performance Teams, Developing a High Performance Strategy, Principles of High Performance

While many training and consulting companies across the United States concentrate on improving employees’ technical skills and daily processes, Lighthouse Leadership Solutions has a vision different from the rest. 

Our goal is to prove that no amount of technical training and benefits can motivate and empower employees like human developmental training. Essentially, the distinction is our emphasis on the model for the high performance business, rather than the traditional model that has dominated the business world for so many years.

Consider these facts:

 • A Sherwin Williams auto paint plant boasts of 30% higher productivity, 45% lower costs and 25% fewer employees for equivalent volume over a sister plant.

 • A Digital Enfield plant yields equal volume to sister plants with half the people and half the space, while realizing a 2.5 times higher rate of first-time-perfect modules.

 • A Corning mold machine shop realized 100% improvements in quality and delivery while reducing costs from 15% above to 15% below the competition.

• Rocky Mountain Labs reduced turnaround time from 28 to 14 days, reduced internal handoffs by 500%, thereby improving productivity by 50% and profits by 25%.

 • Tektronix Portables Division reduced inventory from $40 million to $15 million and reduced cycle time from 12 weeks to four weeks.

 • Shenandoah Life Insurance Company reduced the employee-to-supervisor ratio from 7:1 to 37:1, yet service improved and complaints and errors declined.

 • American Transtech decreased head count by 56%, increased sales volume by 46%, increased customer satisfaction and had an average of 158% improvement in shareowner services.

These are just a few of, literally, hundreds of businesses that are achieving outstanding results in the United States.

 They are doing so by changing the way work is organized and empowering the people who do that work. This is known as high performance work systems! But before looking ahead let us look at where we have come from.

 The Traditional Paradigm

The model that has dominated most modern businesses is based on a set of principles and practices formally defined by Frederick Taylor in 1903 and known as “scientific management theory.” The principles of scientific management theory were very useful a century ago when this country was moving from a rural society, in which people were self employed, produced their own food, made their own clothes and educated themselves, to an urban society based on mass production and interdependence. With these changes in the structure of society and the way work was organized, it was necessary to create bureaucratic organizations to manage and control masses of untrained people. Taylor believed that work could best be accomplished by breaking it down into simple and repetitive tasks for workers and that management’s job was to control the means and speed of production. Some major features of job design that came out of the industrial revolution are the following:

• Simple, narrowly defined jobs.

• Division of labor that keeps different functions separate.

• One best way to do a job.

• Uniform and strictly enforced policies.

• Management’s role to control the means and speed of work.

 Although this paradigm may have been useful in moving us to an industrial society, it does not fit with the complex and changing nature of the economy, market place, technologies and people today. It is seriously flawed in two primary ways.

 First, traditional organizations are structured around functions. The problem this creates is that work is fragmented in such a way that people do not see or feel responsibility for a “whole process.” They over identify with their own jobs and fail to understand or care about the overall good of the company or the customers they serve. This leads to poor communication, redundancies of effort, turf battles, delays in decision-making and general inefficiency. It is most noticeable when a piece of work is completed and “thrown over the wall” to another department to be forgotten, or when an urgent decision that directly impacts a customer is delayed for a couple of days because it needs someone else’s signature, or when work is inspected after it has been built. The former Soviet Union was the paragon of inefficiency and bureaucracy. It took five years for the government to approve construction of the first McDonald’s restaurant, and to change a single ingredient in ketchup took numerous levels of government approval.

 A second flaw of the traditional paradigm is the assumption that it is management’s job to control the work of employees. Management sets goals, makes decisions, measures progress, evaluates performance, etc. Managers are the thinkers and planners, and employees are the doers. These organizations fail to tap the tremendous intelligence and creativity of their people. Power exists at the top and people on the “front lines” and closest to the core process of the business have less authority to make decisions, solve problems or significantly contribute to the mission or goals of the organization.

 Most people do routine, repetitive and somewhat unchallenging jobs without much sense that they really make a difference in the overall direction or success of the business. This results in organizations that are bureaucratic, rigid, unconcerned about quality, lacking innovation, unresponsive to customer needs and generally unsatisfying places of employment. Unfortunately, in spite of such limitations, the traditional paradigm continues to dominate the practices of most businesses throughout this country today.

 The High Performance Paradigm

There has emerged in recent years an exciting new paradigm known as high performance work systems, and is changing the way we think about people and how work is organized. A high performance organization could be defined as an organization in which each person is a contributing partner to the business. High performance work environments require a deep respect and trust in people. People are not viewed as extensions of machines, objects to be manipulated nor costs to be controlled but rather as thinking and feeling human beings who bring enormous energy, creativity and talent to their work. Most people want jobs that are meaningful and allow them autonomy to make decisions and contribute to the company in significant ways. Effective organizations are those moving beyond attempting to control people to trusting and empowering them with the resources, information, tools, skills and support to manage their work processes and create products and services of unprecedented quality.

 Of course, many companies espouse a philosophy that values people and yet they are not experiencing the kind of performance described at the start of this article. That is because they are not designed to do so. Only a holistic and systemic view of the organization, in which all aspects of the organization are aligned behind this philosophy, will realize the true value of their people.

 In high performance organizations people understand the businesses are committed to getting results and are organized into self-contained, multi-functional and customer-focused business units or teams. These teams take full responsibility for making decisions, solving problems and continuously improving the quality of their work. Everyone involved with a particular core process are members of the same team and are empowered with full authority for the success of a whole product, service or major segment of work. Roles and responsibilities are much broader and more meaningful in scope than in a traditional organization. The team is responsible for setting goals, coordinating and scheduling their work, interfacing with the customer, training, making decisions and problem solving, monitoring quality and even measuring performance and making hiring decisions. The role of management changes from that of controlling workers and solving day-to-day problems to being facilitators and coaches. They define outcomes, manage boundaries, interface with other departments and, in general, ensure that the team has the resources, training, information and support they need to carry out the job.

 For more information on how to build a high performance organization contact Lighthouse Leadership Solutions at 800-592-6510.

Paul Wilson Asessing Your Organization for High Performance, Developing a High Performance Strategy, Principles of High Performance

          As I went through the drive through at McDonalds yesterday I was reminded of the old Wendy’s commercial from the 1980’s where the lady went into McDonalds and lifted the bun and said “where’s the beef.” I suspect that today if that same lady walked into McDonalds she would say “where’s the service.” In my last visit to the golden arches I went through the drive through and not one single person spoke to me after I placed my order. I drove to the window, handed the young lady my money, and she handed me the change without saying a word. I drove forward to where my drink was already hanging out the window, as I took the drink, the bag with my food quickly followed. The young lady handing the food to me did not even look at me but continued the conversation she was having with another employee. Now, I have to say that it was a very efficient process, it took less than a minute from the time I placed my order until I was driving away with my food and my order was correct and complete. However, the whole experience left me feeling empty somehow, not fully satisfied.

          As I drove away I wondered;  is this what we have come to? Is the wave of the future? Are we replacing service with efficiency? Are we teaching this generation of employees that it is more important to be efficient than to connect with the customer? As a society is this what we want? Of course, McDonalds is not the only place where this is happening. It is just the most recent example. This scenario is taking place in businesses all across the country every day.

          So what has happened? How have we gone from a society where businesses used to value the customer to one where the customer is nothing more than an afterthought? I think there are two things that led to this. Number one, companies stopped focusing on the external customer. Number two companies began trying to “satisfy” their customer.

          About 20 years ago a trend started where everyone said we needed to provide service to both our “external customers” and our “internal customers” also known as employees. They said a “happy employee will take better care of our customers and then we will have happy employees and happy customers.” Well, I agree with that to a point. You see, the problem is that now we have a generation of managers and leaders who are great at providing service to both external customers and internal customers, because this is what they have been trained to do. They are servant leaders, they go above and beyond to treat everyone well. And that’s great. But somewhere along the line these leaders forgot to tell their internal customers that they are supposed to take care of the external customers. Today we have employees who are spoiled.  They expect their companies to give them a paycheck regardless of how hard they work and they expect their companies to ignore their bad attitudes, their tardiness, and their laziness. Today we have people complaining about working at…work. Now don’t get me wrong. Internal customer service IS just as important as external customer service. We just need to make sure that those internal customers are focused on the external customers and not just themselves.

          About the same time that we started to focus on our internal and external customers it became important to have “satisfied” customers. All through the 1980’s and 1990’s the buzzword was customer satisfaction. Over the years we developed numerous methods to measure customer satisfaction. We have comment cards, telephone surveys, internet surveys, secret shoppers, and a variety of other methods to measure customer satisfaction. The theory was that customer satisfaction would produce positive financial results. However, current research findings suggest otherwise. High levels of customer satisfaction do not translate into repeat purchases. Customers who claim to be satisfied will switch to another supplier or provider without hesitation if offered a lower price, more variety, more convenience, etc. This is why so many companies now have to offer discounts, coupons, sales, and value menus. Many retail stores now have “one day only sales” every day, to try and get customers to come back, you know which ones I am talking about. What is interesting is that retailers who are known for their outstanding customer service, like Nordstrom’s, rarely if ever have sales or offer coupons and discounts. They have figured out that the true measure we need to be concerned with is customer loyalty. The best indicator of customer loyalty is repeat purchases, which is tied more to behavior than attitude. In other words, no matter how satisfied a customer is they may still take their business elsewhere. Customer loyalty has a big impact on the bottom line as well. Studies show that it costs five to six times as much to gain a new customer as it does to retain a current one.

          Customer loyalty is built one experience at a time. Positive experiences keep customers coming back. And customers tend to increase money spent the longer they remain a customer. Customer loyalty pays and pays. Customers often switch companies simply because they find someone else who is more responsive to their needs. They may not be dissatisfied but they are not delighted either. Delighting customers is one way to increase the likelihood they will remain loyal and increase purchases over time.

Paul Wilson Asessing Your Organization for High Performance, Core Skills, Customer Service, Developing a High Performance Strategy Business Optimization, Management Training

many would say we are living in tough, uncertain economic times.

Watching, listening to or reading the news you will “know” that new layoffs are announced every day, a shaky stock market is followed more closely than ever, and uncertainties seem to be everywhere.

This article is written to address this current situation, but the lessons apply to any challenging time you and your organization may be facing – whether global, local or company specific. Read more…

Paul Wilson Developing High Performance Teams, Sales Training Sales

As a small business owner or salesperson you are always on. You are always presenting, marketing, selling and producing. Failure to acknowledge this will prevent you from being as successful as you could be. I dare say it can actually do harm to your business.

Let’s break it down and take a look at each area. Read more…

Paul Wilson Core Skills, Emotional Intelligence, Sales Training Management Training

At some point in his or her career, every politician gets tarred with a catch phrase–and usually not a flattering one.

George Bush, Sr. is stuck with two. There was “Read my lips, no new taxes,” of course. But only slightly less unfortunate was his dismissal of what he called, “The ‘vision thing.’”

He was trying at the time to shake the impression that he was a competent day-to-day manager but he lacked any grander vision of where he wanted to lead the country. His choice of words and tone of voice didn’t exactly help. Read more…

Paul Wilson Asessing Your Organization for High Performance, Developing a High Performance Strategy, Principles of High Performance Management Training

If you’ve seen the movie Jerry Maguire, you’ll remember the scene where Tom Cruise asks Cuba Gooding, Jr., “What can I do for you?” Gooding says, “Show me the money.”

Many employers think that’s the key to employee engagement. But any company that THINKS you have to pour money on employees to get them engaged will write off employee engagement efforts during tough economic times. “We just can’t afford to do it right now,” they say. Read more…

Paul Wilson Developing a High Performance Strategy, Positive Impact Business Optimization, Employee Engagement

Like any outsourcing decision, retaining outside telemarketing services should be subject to cost/benefit analysis. Evaluating the costs may be a complex process in some cases, but it is at least a quantifiable side of the equation. Less readily quantifiable are the benefits.

While ultimately the goal is that some benefits can be quantified in terms of sales results, it is useful to recognize that there may be additional, tactical benefits to be gained by outsourcing telemarketing. Only when these broader implications are understood can a full cost/ benefit analysis take place. Read more…

Paul Wilson Core Skills, Developing a High Performance Strategy

When I talk to people about goal setting, I’m often surprised by their reactions. A lot of people tell me that they haven’t gotten around to setting life-time goals and identifying their values and coming up with specific, measurable bench marks, etc…

They tell me that goal setting takes too much time and energy, and that it will require days and weeks of work and that once they have the goals they’ll start to feel bad if they don’t reach them. Read more…

Paul Wilson Core Skills, Emotional Intelligence, Positive Impact Business Optimization

In today’s competitive market companies need to have polished, high performance sales reps.  Unfortunately, finding and retaining high quality sales professionals is one of the biggest challenges facing small businesses.

Often, companies end up taking the easy way out by hiring a friend or relative–or by compromising and hiring someone who only has some of the necessary skills.  These decisions frequently end up in disaster. Loss of opportunities, lower revenues, and time wasted in training are only some of the problems brought on by such choices. Read more…

Paul Wilson Asessing Your Organization for High Performance, High Payoff Hiring, Sales Training High Payoff Hiring