40 – Restaurant Leadership – How to be a better leader in your Restaurant.

Restaurant Leader

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Many of the problems in Restaurants that we see come down to issues with Leadership.  Restaurant Leadership is something that isn’t taught, most people pick it up on the job, so we will go through some tools to help with your Restaurant Leadership.

What is the definition of Leadership and in particular Restaurant Leadership.

Restaurant Autopsy.  One of the Restaurants using our Free Online Restaurant Booking System has closed.  We go through the issues that they had.  The biggest issue was that even though they weren’t busy and wanted to be better, and it was quiet on Saturday nights, they did no marketing.  Even worse, the website was very poor, no great photos, no SEO (getting found in Google).  There web traffic dropped from 750 a month down to  600 over the last 18 months.  These is less than half of what their competitors were getting.  It probably equated to $10,000 a month in revenue that they were missing out on. I wonder what was going on in the minds of the people in the team there, doing nothing to find more customers.  The only marketing they did was Groupon at the end.

We talk about what Leadership is and look at Dwight D Eisenhower’s definition of Leadership, which is “Getting people to do what you want them to do, because they want to do it”

How does Restaurant Leadership work in a Restaurant?  There is the typical angry chef, but I think it is a lot more common to have no Leadership in the Restaurant.

We look at the mindset that people need to be able to be an effective Leader in your Restaurant.

Make sure that your Personal Plan aligns with your Business Plan which aligns with your Marketing Plan.  Too many people forget why they opened their Restaurant and they lose their passion for their Restaurant.  It is so much harder to motivate people if you aren’t motivated and passionate about what you are doing.

We look at BHAGs (Big Hairy Audacious Goals), and we talk about Missions, Values and Goals and how these are tools to help you be a better leader, but also the big component of the business that you are responsible.

We talk about Adam Sobel’s Vision from Cinnamon Snail and Nick Sarillo’s Nick’s Pizza and Pub.  Check out Nick’s book, “A Slice of the Pie.”

Nick’s Pizza & Pub Values

  • We treat everyone with dignity and respect.
  • We are dedicated to the learning, teaching, and ongoing development of each other.
  • We have fun while we work!
  • We provide a clean and safe environment for our guests and team members.
  • We honor individual passions, and creativity at work and at home.
  • We communicate openly, clearly and honestly.
  • We honor the relationships that connect our team, our guests and community.
  • We take pride in our commitment to provide quality service and a quality product.
  • We celebrate and reward accomplishments and “A+” players.
  • We support balance between home and work.
  • Health: We are a profitable and fiscally responsible company. We support the physical and emotional well-being of our guests and team members.
  • Our team works through support and cooperation.

We look at the E-Myth and how it can help you delegate.

How can you be a better communicator in your business.

We also look at Danny Meyers “Setting the Table” as well, another great book on the topic of leadership.

  • Have a personal plan
  • Be passionate
  • Define your values
  • Hire for values and train for skills
  • Procedures
  • Delegate
  • Communicate, Communicate and Communicate
  • Find a mentor.

The journey of leadership is never ending, but remember – The better you get, the better you get.

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Podcast transcript of episode 40: Restaurant Leadership

James Eling: Hey, its James of Marketing4Restaurants and welcome to Episode 40 of Secret Sauce the Restaurant marketing podcast: Restaurant leadership. What is restaurant leadership? Why is leadership important in your restaurant? How do you do it and how can you be a better leader in your restaurant?

James: Welcome back everyone, thank you so much for tuning in today. How did you go with the Secrets of Restaurant Profitability? One of our most popular podcasts already, a lot of people have been downloading it and commenting. We’ve been getting some great feedback. I think the really, really interesting thing about that is that Ivan is attacking the problem of restaurant profitability from a completely different point of view. And I think that’s really important because everyone knows that restaurant profitability is such a difficult thing to do. If you’re doing what everyone else is doing then you’re probably going to have very similar results. And those results aren’t great. Most people aren’t making money they’re actually struggling to be able to pay them, themselves the proper rate. So, I think we need to be looking at restaurant profitability know from why and that podcast is an amazing way, Ivan’s got some great ideas there so if you haven’t checked it out have a quick listen to it.

Today we are going to be talking about restaurant leadership. I think that this is a really fascinating subject because when we go to a restaurant just as someone who is going to eat in restaurant often you can see that there are significant problems in a restaurant and those problems are self-reinforcing, you create this negative feedback loop which is really quite sad. A lot of those problems come down to leadership. So, we’re going to look at what it is, we’re going to talk about how to define leadership. We then going to start looking at some of the tools that you can use so that you can become a better leader in your restaurant. I’m really passionate about this I think this is one of the most important things that you can do in a restaurant to be able to improve of the outcomes in your restaurant. Before we get there though, tragically we’ve got a restaurant autopsy to conduct we’re going to be peeling back the components of the death of a restaurant. And this is a little bit of an interesting one.  It was a customer who was using our free online restaurant booking system. And that means that we’ve got a little bit more information than you normally get.

Often you just see the “For Lease” sign or “For Sale” sign up on the window of the restaurant. You see, you can look in all the tables and chairs are gone and you know the restaurant’s died but you don’t really know what the problems were. With this one we’ve got a little bit more information so we’ve eaten there probably about 4 times I would have thought. Quite a good little local restaurant, not local to us we travel to it because we knew the owner and they were using our free online restaurant booking system and the food was pretty good, the kids like eating there. Now, the interesting thing about this is they’re been using our free online restaurant booking system for about two years now. And one of the things that we do with the restaurant booking system is that we give our customers who are using it some information on how they can do better marketing and these guys did none of that. And I find this really fascinating so the restaurants’ been sold and they said you know so we can get more time with the kids which is completely fair enough but I think that the reason that they didn’t have enough time with the kids was because the fact that the restaurant wasn’t profitable and you knew that. We’d been there on Friday nights and the place was only half full. If you’re not filling the place on a Friday and a Saturday night then you’ve got really, really big problems. You can still be quite unprofitable while being really busy on a Friday, Saturday night.

These guys weren’t busy on a Friday, Saturday night so we know that it was, that profitability was a significant struggle and they talked about that as well. The thing I find amazing though, is that there are a whole range of free or very low-cost marketing things that you can do in a restaurant they done none of those things over the 2 years. And every time that we would go out there the owner would come over and tell how’s things he obviously knew that  I am the owner of Marketing 4 restaurants.

And so, he would come and talk to us and he’d be looking for ideas and we’d be discussing things we’d do a little bit of menu engineering. We’d go through the website and we’d go through their Facebook page and the problem was that the website was very bland. Their signature dish I guess would be some of their steaks there was nothing on the website to suggest that you would want to go and eat a steak there. There was no amazing photo of a steak. They didn’t describe themselves as a steak house. Anyone looking for a good steak is not going to find them. The search engine optimization around what it was that they do for all of their customers was very poor.  It was a bland website that was probably about four or five years old. No search engine optimization so they’re not getting found by Google and very little styles process on the website. So, no great photos, no great compelling reason why you would want to eat there. And these are the things that created problems for them. Now with our free online booking system one of the things we do is we always send reports to our customers because we believe that online marketing is all data driven. You know what’s working and what isn’t because you can see the data for it. The thing that was really interesting I found with their numbers was that b when they started out with us they were getting about 750 visits a month which, hey! That’s actually, that’s not too bad from a website point of view.

Now it can definitely better and there are some people out there who are getting 10,000 visits a month but your average local restaurant is probably getting around 1,100 to 1,200 visits a month. They were getting two-thirds of that. Now the scary thing is that those numbers had slipped over time so by the time they were closing they were getting 600, 650 — less than half of what their competitors are getting. And I think that this is a really fundamental thing that you’re thinking about. Everyone thinks that their food is amazing and that they’ve got that really compelling environment experience that they create with their front of house team and that the food is amazing, the prices are very, very competitive. But they were missing out on around 600 visits per month. Now your conversion rate on those 600 visits: It could be 1 in 10 which is 60 visits a month the average booking is for 3 1/2 seats that 180 covers and they’re probably a $50 restaurant so 60 bookings, 3.5 seat per booking and $50 a seat that’s an extra $10,000 in revenue.  and the owners said I’ve sold it and he was a little bit sheepish about it so I’m fairly confident that he didn’t get a good price for it because of the fact that the numbers wouldn’t have stacked up.

I’m really keen to do the episode with Robbie Doyle about how to sell a restaurant we’ve talked about how to buy a restaurant. That would be the kind of restaurant that you want to buy I think because it’s got a good reputation just doesn’t have enough regular customers. They’ve done no marketing whatsoever so their email list that they’ve built up there that’s never been emailed out to so those people are waiting to get some sort of information some sort of news about what’s going on in the restaurant. That’s a no brainer. These guys, just by fixing their website could probably bring in an extra $10,000 a month. Those calculations, 60 bookings, 3 1/2 seats per booking and $50 that’s $10,000 a month. Food cost at 30% you bring in $7,000 to the bottom line. That’s an extra $80,000 in your pocket.

Now, either that makes it sustainable or that means that you can then work less hours because you are able to put more staff in. You’ve get the resources to do the important things like systematise the business or just at the most basic level, the price that you get when you sell that business is going to be so much more because you don’t need the marketing is already running there so the new owners doesn’t have to worry about marketing.  The person who did buy got it at a discount because he needs to worry about the marketing for the place because it’s not profitable.

The thing I find most interesting about this is the fact that the owner knew all of these things and yet over a period of two years he did none of them. No emails, no Facebook marketing, no updating to the website, no putting great photos on there. None of those things happened and I know everyone’s really busy, we’re all super busy, we all work really long hours, I get that but over a two-year year period of time. You’ve got to be kidding me there’s the opportunity there to make those little tiny things just once a week make one or two little changes and that’s the investment in time that’s going to pay off over those two years. The only marketing that he did was Groupon towards the end. And this is how we knew that he was in trouble, we knew he was in trouble before he closed the doors.

Now, I don’t know whether he did the Groupon to try and boost the numbers, to get a better sale price or I suspect that he was trying to keep the business going he was trying to get, generate the cash to be able to keep the business going. And far too often we see people who start doing Groupon and then they’re out of business three to six months later. We’re not saying Groupon sends them out of business, what we are saying though is that desperate restaurants tend to use Groupon. There are very few restaurants that have a sophisticated approach to Groupon marketing. It can be done, we’ve seen it done but it is very, very, very difficult to do and it’s marketing with fire and if you get it wrong it will burn you and will burn you horribly. And this is why we look for traffic coming from Groupon in our customers so that we can give them a call and say, “Let’s talk about what the problems are. Let’s try to come up with a better solution because if we’re going to be Grouponing.” I think it’s highly unlikely that you’re going to be able to have a sustainable business in 12 months’ time.

Ah, Sad times really, really sad times. The psychology of a restaurant owner what is it that stopped him from taking those simple steps rather than reaching for the new, clear option of going for some Groupon campaign. I’m not sure you see it a lot in bar rescue and restaurant impossible. You see the work that they do to try to break down those psychological barriers, one of the things that I’m interested in is how do you break those barriers down: A) By yourself, and B) Before you’re in a position where you’ve only got two days’ worth of cash flow left. How do you wake up one morning and think I’m not happy with the way that the restaurant is going. I need to start making some changes and then slowly start making those changes. I think that is a fascinating topic mostly we get to talk about it mostly I’m doing a lot of research in that space because I think that there’s a lot to be said for. So, let’s get out of the autopsy room and get into something a lot more exciting: restaurant leadership.

I’m fascinated by leadership because I think that’s one of the really key differentiators in any small business, any business at all. When i started my first business in 1999, our accountant said that you should go and do an MBA. And I thought, you know what that sounds like a really good idea. So, I went off and did an MBA. I did mine at the Menlo Business School and it was a, when I looked at the course curriculum I thought well there are lot of fluffy subjects in there. It wasn’t a rats and stats type MBA. We did a lot of work on culture, organizational behaviour and leadership. I wasn’t overly excited about that. My background originally was as an intensive care nurse. There’s very poor leadership training in nursing which is why I didn’t really place a high value on it. Which I think is quite sad. The interesting thing from my point of view was that I think that was what I got the most out of was the discussions around leadership and culture. One of the organizations that we looked at when we were doing our leadership studies was the United States Marine Corps. They take people from a huge, wide, diverse range of backgrounds and they turn them into an elite fighting force. I thought, “Wow!  That’s really amazing. Of course, leadership in the military is incredibly important because you’re asking people to put themselves in harm’s way. Now that’s something you’re never going to do in your restaurant. You can’t, it’s illegal to do that and people wouldn’t do it. Wouldn’t put their life on the line to get that souffle out. That would be just crazy.

Leadership is studied a lot more, taught a lot more in the military. So, after I did my MBA I thought I would join the army reserve. I have been lucky to have 12 years of experience in the army reserve as an officer being continually exposed to a wide range of leaders, wide range of leadership skills and styles, and being able to just observe great leaders within the army. And I think that’s helped me in my personal development a lot. How does that help you? Well, the interesting thing is in restaurants is there’s no formal education process around leadership which means that it tends not to get discussed a lot. And I think when you think restaurant leadership there’s two kinds of issues, I think, with restaurant leadership. The first one is that there’s the image of the angry chef who’s barking at people and demanding a very, very high level of quality which is not a great leadership style. I don’t think. It tends to stifle creativity and people aren’t endeared by working at that place. If it’s a high-profile chef they’ll do it because they know that they can put it on their resume. You know, “I worked here for 18 months.” And that’s a wow. That guy is really hard if you can work there for 18 months you can certainly work in my kitchen. And I’ve spoken to so many chefs who that was the reason that they worked for so and so or this guy or that person in that restaurant. I just wanted to put that badge of honour on my resume to be able to say that.

Now, if you’re the leader in that restaurant that’s a little bit of a sad endearment. The people wanted to be able to put in their resume that they were able to put up with you for 18 months. That’s not great. It also means that it’s very hard for these people to get a decent role model and to get a decent context about what restaurant leadership is.

That’s the topic that a lot of people think about when they think restaurant leadership. I think that there’s a much more common and a much bigger issue in restaurant leadership and that is no leadership. This is the thing I see so often. There is the boss whose power to compel people to do work is, they’re the boss and they pay their wages and so the employees come in because they have a mortgage and because they need to pay that mortgage off and they haven’t been able to find a better job and they do what they do because the boss tells them what to do so that they can get paid. Now, that is really sad and you’re missing out on so many of the amazing things that leadership can give you.

So, what is leadership?

Now, of course, my background in leadership is predominantly military and so I fall back on a military quote and it is a quote from Dwight D. Eisenhower, President of the United States, responsible for the planning of D-Day which was probably one of the most complex endeavours undertaken in the 20th century. A whole range of countries, a whole range of people, a huge number of people from different services. Air force, Navy, Army and they all talk differently, they all think differently, trying to do it in a very complicated environment, trying to conduct the task that is actively being opposed by a whole leap of other people who’ve got a whole heap of advantages they’re on the defence they’ve got a lot of advantages. You’re on the offense you’ve got to get all of these people to come together to perform one massively important task which was to forge a bridgehead to set the conditions for the liberation of Europe.

So, Dwight D. Eisenhower thought that leadership is the art of getting someone else to do something that you want them to do because they want to do it. It’s very short, so getting someone else to do something that you want them to do because they want to do it. It highlights a lot of the components of leadership. There’s the vision, there’s what you want done you’re communicating that to them and you are motivating them to do that. Leadership is a lot of it is around creating alignment. you want everyone rowing the boat in the same direction. This is a really important concept for restaurants because you often, Eisenhower was dealing with the Army, the Navy and the Air Force they all want to do their own little thing. They all look at the big problem a night they peek at the bit that they’re responsible for. They think that’s the most important thing so they frame the problem in a way that is very separate to the way the other services do that. Now does that sound familiar? Does the competition and the different viewpoints of Army, Navy and Air Force.  Does that sound like front of house and back of house? Incredibly important to creating and amazing experience to your customers it’s quite hard to do it without a front of house without front of house experience, it’s quite hard to do without great food. You need both of those teams working together to create that one goal of creating a great experience.

So, creating the alignment through people. I think that’s the thing that Leadership can do, Now, why is it important?

There’s a couple of things one of the things I find really, really interesting is when you go in and you speak to a restaurant owner and they’re like, “Ah, I’ve got five minutes to talk, I’m just so  busy. Sometimes I just hate my job. We’ve got so many problems. I don’t have a good staff here. I can’t trust my staff. I’m continually having to show the chefs how to prepare the meals because they never get it right.” And so, you’re in a restaurant where the owner of the restaurant is placing the blame on a lot of the individual people. I don’t think that that’s right. Leaders take responsibility for everything that goes on in the restaurant and I think you know so the leaders are going to take the responsibility for everything that goes wrong and would take the credit for nothing that goes right.

So, I think good leaders this one of the things I try to do. Everything that goes right in our company I say you know what that was good work, that was good code that you guys wrote. That was a really good cause for engagement. That was a great marketing campaign that you designed.  That is some great art work. When it goes wrong, I didn’t clearly articulate what it was that we wanted with that artwork. I haven’t provided the training to be able to run great Facebook campaign. We don’t have great procedures around how to perform that role. So, I take responsibility for the everything that goes wrong and I take the credit for nothing.

That’s one of those little things that you can start and you can see that these people who are so unhappy in their job as a restaurant owner they’re not doing that. they’re laying the blame on all of their staff which is really hard because it means you’ve got to hire the perfect staff and how easy is that to do, right? And it places a lot of the things out of your control. Being a leader and a manager to some respect I like to have control I like to frame it. All of the problems are framed in a way that I can have an influence on them. Because if it’s something I can’t have an influence in that’s very stressful. So, in these restaurants where there is poor leadership, morale is low the way that that person is unhappy as the leader that projects on to everyone else and you’ve got front of house staff who are creating the vibe of the restaurant it projects onto the customers. You can walk into some restaurant you can just feel everyone is here because they have to be.

No one is excited to see you, no one is excited to share the cuisine of their home country with you and to introduce you to a little bit of Malaysian culture or this is the way that this Indian food was cooked by my parents in this part of India or were really excited about getting the best local beef that we can and creating just simply amazing meals with it. No one’s got that story, no one’s doing that. From a marketing point of view because that’s part of the product that’s one of the four Ps. Part of the product is that whole experience and you’re not doing a lot to create a great experience when morale is really, really low.

Employee churn, I’ve spoken to some restaurants who say we don’t do a lot of training because they don’t last very long. Now, that is an interesting statement have you got it the wrong way round. Is it people don’t last very long because there’s not a lot of training here. One of the things that makes it hugely stressful for foreign earning employee is when you want them to do their job but you haven’t told them explicitly what their job is or how to do it. You don’t have it systematized and they’re like going well I’m just going to lay the table this way. Wah, don’t do it that way, well, how was I to know that you wanted it done this way? How was I to know that this was what the way that the dish was meant to be prepared because you don’t have recipe cards. The other thing I think that makes this really difficult and that’s a little bit more esoteric your ability to execute on a business plan. You need people who are engaged, who are listening and who are committed to helping you execute on your business plan.

If you’ve got poor leadership its very, very difficult to create that, you can tell people to do that and they’re going to do it because you’re giving them money to do the things you’re telling them to do but you will not get complete buy in from them that’s very costly. And so, just by thinking about your role as a leader you can start to make some changes about the way that the restaurant functions and one of the things that I find really interesting is that you’ll have someone with an underperforming restaurant and they’ve had it for 10 years and the only thing that I think that needs to change in that restaurant is the owner’s mindset that they run an underperforming restaurant because when you start asking yourself the question about how am I going to change this and start implementing those changes it will start changing the restaurant that’s underperforming they only need only a few more customers coming in to start making a difference. Now a few more customers aren’t going to make you instantly profitable but it makes you less profitable which means you’ve got, slowly you’re going to be having a few more resources there whether those resources are time or money to be able to start improving your situation.

And then you can get that snowball effect those little tiny investments who can just make a much, much big a difference when you start doing them over to your period. So the first part of leadership is making sure that you’ve got a personal plan that aligns with the business plan that aligns with the marketing plan. What is it that you want to do and so there are people who, you know, I would like to sell my restaurant for half a million dollars when I turn 60 and that would be my retirement fund or I want to run a restaurant that allows me to take 2 family holidays a year. You need to have that and far too many times people have that beaten out of them by another week when were profitable, “Ah, another chef just quit.” “Ah, another waitress has just done something completely crazy and we’ve got another really bad review on Tripadvisor.” You get that beaten out of you and you forget what it was that you opened that restaurant in the first place.

People, you’ve got to remember what it was why you opened that restaurant or what it is that you want to do with that restaurant you’ve got to think about that the first thing you wake up in the morning and you’ve got to be passionate about achieving that when you come into work. Second thing you look at your business plan and you won’t be able to do that if you can’t see a way to be able to do that. i have lost all hope in making this profitable. The whole dream is dead and everyone is going to know. The stink of death will be on your restaurant whether is closest or not it’s going to have the stink of death. So, you’ve got to be passionate about your personal plan. You then got to think about the business plan and that’s the hardest bit to do. I want to have two family holidays this year or next year. Next year, I’m going to take two family holidays. The first thing you do is to motivate yourself around that now I think there’s a whole heap of different things that we can talk about that’s a whole separate podcast.

You go to that and make sure your business and your marketing plan can make that viable. Because when you can see the road ahead you’re going to be coming into work and you’re going to be passionate about what it is you do. And that is the first thing that you need to do. You need to be passionate, you need to be excited about running a restaurant. It’s awesome! Food is a critical part for everyone’s survival and it is fundamental to so many social interactions. And there are so many things that you can do. You can express your creativity, you can create amazing bonds within your community and so all of those sort of things. Pick one, pick two or three. Get something that’s meaningful to you and have that. I think, Leaders are inspired people you can’t lead people if you don’t know where you’re going, that’s the first thing. Have something.

The second thing I think you need to do, you need to be really clear about what the difference is between a manger and a leader. A manager is responsible for, in a small restaurant, you’re doing both of those jobs. You’ve got to be clear about what those jobs are. The manager is responsible for today. he’s responsible for making sure that the customers come in the level of service that is part of your business plan is provided to each and every one of your customers and that your staff are positioned and able to perform the roles that they have. the kitchen is keeping waste to the agreed amount, the budget is being adhered to. there’s going to be enough stock. You are not going to run out of food. the wait times are going to be adequate, the people are seated properly. Food is delivered on time, if you’re doing online ordering. Food is delivered on time so that it’s still hot and juicy and exciting. All of those sort of things need to be done that’s what a manager does. So, the manager is concerned about today. The leader concerned about tomorrow. This is where we are going to be. What do I need to do to be able to achieve the tomorrow that I want?

And I think that there’s a couple of tools that you can do, that can help pave out that way. There’s a few things, mission, purpose, BHAG. I’ll include in the show notes some of the work of Verne Hanish where he has a pyramid of how to run a business and right at the bottom of that pyramid is the your BHAG. Oh, BHAG. I don’t want to get hung up on semantics because at the bottom it can get, it is pretty fluffy sometimes and people argue about, what I think the mission is this and I think you shouldn’t have a BHAG. I think as long as you have some star by which to navigate by were moving in this direction that the important thing.

So, in our company we have a BHAG, a Big Hairy Audacious Goal.  This is our aspirational goal and that is to make a meaningful difference in people’s lives”. It’s really, really hard to run a restaurant. And a lot of people undergo a lot of psychological stress because of the pressures and the issues in running a restaurant. So, to make a meaningful difference in people’s lives, we want to be able to help restaurant owners run better restaurants, that’s our thing, that’s the meaningful difference that we can make in people’s lives. Taking a restaurant that is not performing well and being able, providing them the tools and the capabilities to be able to build profitability. I try and reference that at least once a week in our meetings. I think that was a really good example of us achieving our BHAG. We got some feedback from a customer.

He said this I think that this is really good or oh look something went wrong did we think about how we are going to make a meaningful difference in this person’s life because I don’t think that we’re positioning ourselves to be able to do that. I think we’re failing in our BHAG. We got a mission that sits above that, that is to solve restaurant problems there are a lot of problems out there. how do you build an email database? How do you get more customers to come in? How do you run effective Facebook campaigns? How do you build an e-commerce platform for your business so that you can market your yourselves online in a cost-effective way? There are a series of problems that we do and there are a series of products that solves those problems. That’s how we solve restaurant problems.

There are some other people out there I think of the vision that Adam Sobel’s got from Cinnamon Snail. He wants to introduce vegan food to non-vegans because he’s really passionate about the fact that it’s unsustainable for everyone to be eating meat. So he’s really, really interested in getting people to understand that you can have a vegan diet or you can eat less meat and still have really, really amazing tasting food. That’s what he’s passionate about creating these amazing taste experiences in a vegan context. And I think that is really, really, really powerful to be able to do that. It helps attract people to his business, it helps in a marketing point of view. All of those sort of things I think are amazing.

Nick Sarillo at Nick’s Pizza and Pub, I’m a big fan of the work that Nick does. I’ve been out to his restaurant, huge place, really exciting. I have his book on my desk because I refer to it every now and then because I think that this is one of the great textbooks in building a culture, in building a concept for leadership in a restaurant. I just want to read out their purpose. The Nicks experience, A dedicated family provides this community an unforgettable place to connect with your family and friends to have fun and to feel at home.” So, their purpose is to provide the Nick’s experience and he’s defined that experience. It’s local and that articulates with their marketing, it articulates with why people work there. It’s amazing, the people who’ve been working there for so long, and I think that it’s important to highlight that because one of the biggest issues in the restaurant industry is that most people are on minimum wage.

In a startup it’s really easy to build a high performing culture. It’s like you know what we’re going to build a billion dollar company. Everyone who started here has got half a percent equity and we’re all going to be super famous and super rich and it’s all super exciting. You don’t have that. The Army is the same thing. Look at the culture, look at the history, look at the mission, to defend your nation”. it’s one of those things that you love and feel deeply passionate about. You’re defending the nation. They’re things that people literally rally around that cause. In a restaurant everyone’s getting minimum wage so having that purpose that can really help unify people which decreases attrition and helps attract the right kind of people. That’s one of the big things, I always find it interesting, when you go into a restaurant and Wow! I don’t know if I’d be hiring that person if this was my restaurant. I think I’d be more firing. And you need to be thinking about the people you’ve got working with you. Cause sometimes it’s really, really difficult to do that. Everyone is replaceable.

This brings us onto the culture. So, one of the things that the leaders are responsible for is the culture of the organization. I like to define culture as it’s the way we do things around here. I define my job as the leader of our organization I do everything that isn’t done by somebody else. Which means that I’m really keen on systematizing things. So, there’s more things that other people can do. I sometimes bring the rubbish in. We don’t have set car parking spaces. I like to think that it’s a meritocracy here. Our star employees are the ones who do a really good job and to share our values. There’s no all boys network here, were very egalitarian. And it comes down to your ability to do your job and to share our values. They’re the big things. Values, we have four values at Marketing4Restaurants. Fun, learning, ownership and communication. it should be fun to work here, we have a massage person come in every fortnight and give everyone a 15-minute massage so that they’re not feeling too stressed.  We like go out to restaurants. for a bit we like to do fun activities. we’ve done all sorts of things. We’ve done rap jumping which is abseiling face first down a building, rock climbing, sky diving, we took some guys skydiving, all sorts of those fun things that are good to do. It should be fun to deal with us. We are very light on for contracts because our customers deal with us, because they want to not because we signed a two-year agreement with them. I think that that’s really important. We want to be able to be seen as a fun company to deal with.

Learning. One of the big things is, what are we learning, and so we have a big focus on listening to podcasts, blogs that we read so that we are continually as a marketing organization, we’ve got to be at the cutting edge. So, we are continually trying to learn. Flipside of that, is that externally it means that we are always trying to teach our customers something. Now, I’m doing this podcast because one of our key values is learning and this is an easy way that I can teach 10,000 restaurant owners about leadership or the secret of restaurant profitability or how to be more innovative in your restaurant. We can do all of those things with a podcast it’s that we’re really a technology evangelist and a podcast is a great way to be able to do that and it spreads our resources really, really economically. Because I know that some of our podcast will get ten thousand downloads. Wow! That’s amazing!

Communication. Open and honest communication. Internally, so we had something going on today and I said well that’s not really good ownership we communicate openly and honestly in front everyone. That’s the way that we’d like to be and that’s the way we deal with our customers. Every Monday we send out an email that ranks all of our customers. Some customers get an email to say you’re on the bottom 50% of people visiting your website. People get angry about that. Well we want to be open and honest about it. these are the things you can do to improve your website. these are the things you can get us to do. Let’s sit down and work about this problem. These are the other things that differentiates us from all of our competitors because most people would build a website and then that’s it and just collect their monthly fee.  And never ever drive anyone to say is your website working for you?  Because we build website that’s where we get most of our money but that’s what we do. That’s what we get paid to do it’s not what we do. You’ve got to think back if we build a website that’s not going to make a meaningful difference in people’s lives and it’s not going to solve any problems whatsoever. it needs to be selling, it needs to be doing the marketing, it needs to be generating cash for our customers. So, we’re not solving any problems, were not achieving our mission if the websites aren’t working and we communicate that clearly with our customers and we’re not making a meaningful difference in people’s lives. if you’ve got a website that’s crap that we’ve built. A. I get a report every Monday, we call Monday here Data Monday because we get all of the information from all of our customers, all over the world and we go through them. What’s going on with this guy because I don’t think we’re making a meaningful difference in this guy’s business we need to talk to them and we need to make some changes so that we can get better results for them. On top of that we share that with our customers. You’re in the bottom 50% of website visitors. And the good thing is it continues to push our average up for all our customers. That’s how culture and values work in our organization.  It will be different in yours. You’re going to have a different mission. You’re going to have a different vision. You’re going to have a different culture and you’re going to have different values.

What I’ll not do is go through all of Nick’s values but what I’ll do is put them up on the website. So, have a look at the show notes. Go through it I think we’ve getting good feedback around the transcripts as well. A lot of the people are enjoying the transcripts not everyone likes listening. People have different learning styles. So, some people like reading through it, it’s a big read I had a look over at the Innovation one I think it’s eleven thousand words there. Oh my God I can’t I believe I talked for that long. But, yes, have a look at the transcripts that will have Nick’s values in there that as well. As a leader once you defined what your values are, you then, you’re responsible for enforcing them. When someone doesn’t share the values, you need to do something about it. And one of the less textbook-y type definition of values that I really, really like i that the values are the things that are going to really, really, really upset the boss. now people make mistakes, people make mistakes all the time. We see that.

One thing that I have a big problem with though is that when someone does go against our values so people can make a big mistake and you think, “Oh, God that’s going to cost us a fortune to fix or that’s really messy.” I’m not really that fussed about it. I bring about what was the systems, how can we educate people better? How can we avoid it in the future but I’m learning from this mistake? That’s all good. When someone doesn’t share our values and clearly demonstrates that. Then I get really, really miffed because that’s part of the contract of working here. These are our values you’ve got to share them if you don’t share them then we’re going to have problems. And I’m very frank and open about that. We hire based on the perceived ability of people to share our values. We fire people for the exact same reason. When we do reviews and this is one of my failings as a leader it’s been awhile since we’ve done reviews I want to share with the people about how I think, how I perceived them to be sharing our values. because our review process is very two-way.

What is it that we need to do to help them do their job and to share our values? When was the last time you did reviews with your staff? Hire for values and train for skills. Start getting a team around you that’s going to share your values and be excited of your mission or vision. That’s going to make your job as a leader to be a whole lot easier to be able to do.

The next thing that I think you should be doing is delegating. Okay, this is one of the big issues and I think you should be thinking about reading the miss Because I love that book. Because what it talks about is the typical trade person who has a job and then creates a business and this is so restaurants so someone is a chef in a restaurant and they decide to open a restaurant and they are going to be the chef.

Now they have expertise in the kitchen which means that the kitchen is probably going to run pretty tight. Front of house is going to be left to its own designs. there’s really no one really to be taking ownership of front of house. What you need to do is you need to forget your skills and step above it. Now I’m not saying that you’re not going to work in the kitchen because you probably love that. That’s probably what you’re really passionate about but you can’t be in there all the time you need to be doing a whole heap of things. You need to be doing the leadership work. You need to be thinking about where you’re going to be in three years’ time. What are food trends like what technology is there in your restaurant that you can be talking about. What is there that you can do to be able to build a team better. What is your training like for the team to do that you need to delegate?

You need to take that step back away from the work you’re doing. Far too many people they’re just chefs. now I’m not saying just chefs as in just chefs but they’re completely ignoring their role as a leader. This is what I was talking about at the start. The biggest problem is just no leadership whatsoever. I’ve employed someone for front of house and I expect them to do exactly what’s needed for front of house I don’t really understand it. they can do and take care of all of that. Well, that’s how you build a really lax culture in front of house. that’s how you build divides between kitchen and front of house that’s how you start to build that culture where things aren’t right for you.

I think, in my first business, this was one of the really, really painful lessons that I learnt. I learnt it by doing the MBA and then coming back into my business and saying Holy cow!  look at the culture here. Every business has a culture. So, you can’t just say well I’ve never done an MBA. So, we’re not going to have a culture. Your business has a culture it is the way that we do things here. Now does that mean when someone comes in I can continue playing on Facebook or playing Pokemon Go for two minutes then I’ll go and see them cause if you don’t tell me not to do that I’m  probably just  going to do that or  I’m on the phone to one of my friends it’s an important phone call so I’m just going to continue talking well it’s not we’re just talking about what we’re going to do tonight. it’s more important than going and seeing the customer who just walked into our restaurant.

Ah, hang on a second, they just walked out again because no one went and saw them. Ah that doesn’t matter, doesn’t matter. That’s your culture. It’s okay. It’s okay to ignore that customer. it’s okay to let them stand there for two or three minutes even though the place is virtually empty. it doesn’t matter. now you’ve allowed that culture to flourish. there are other places where it’s like, “Oh, hello! Welcome! Is this your first time to our restaurant we’re so glad to have you, I want to share with you what’s on the menu today and I want to share what the chef cooked up today for us before we opened it’s really amazing it’s probably one of the best meals that I’ve ever had.” That’s a cool thing being greeted like that passion, were really passionate when we greet people and these are the prices that were going to go through when we do that. You’re responsible for that. So, when someone is on their phone for three minutes ignoring a customer or someone’s finished their meal and they’ve been waiting 15 minutes and the bill has not gotten out to them because someone’s just sitting on the computer fiddling around entering emails or doing something less important. You’ve allowed that to happen in your restaurant and as a leader you’ve got to be the one who says that’s unacceptable that’s not the way we do things in our restaurant. You need to be doing a better job.

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